Ag bankers say credit quality remains a top concern

A new survey of ag bankers shows credit quality and the deterioration of ag loans are top concerns heading into 2020.

“Credit quality is always an issue, particularly late in the cycle—and particularly when a lot of the cash flow really is based on government programs and the support they’ve had,” says James Chessen, chief economist for the American Bankers Association. “So the question is, if that changes, will those farmers be able to cash flow those loans.”

But the survey also shows most bankers do not expect an increase in loan charge-offs—or loans that won’t be collected—in the coming year.

“So they think there’s going to be problems, but maybe they can work that out and manage that working with their borrowers,” Chessen says.

Results of the survey were released at the national ag bankers conference taking place this week in Dallas.

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