Increased Loan Demand and Higher Interest Rates May Benefit Ag Banks

Francisco Scott

Economic Bulletin, 2022, issue July 13, 2022, 4

Abstract: Extreme weather, geopolitical conflicts, supply chain disruptions, and rising interest rates all directly affect U.S. agriculture, which may in turn affect banks that make agricultural loans. Demand for loans from ag banks could rise following events that reduce net farm income or increase banks’ ability to reprice loans, such as supply chain disruptions or higher interest rates. But competition with other banks and nonbank financial institutions may offset some of these benefits.

Keywords: Agricultural Banks; Bank loans; Agricultural loans; Farm income (search for similar items in EconPapers)
JEL-codes: G21 Q14 (search for similar items in EconPapers)
Date: 2022
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