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National & World Ag News Headlines |
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Thune, Baldwin Wants Less Restrictions on Farm Lending Rules
USAgNet - 02/27/2020
Two U.S. Senators are asking financial regulators to ease the restrictions banks and credit unions must follow when making loan agreements with agricultural businesses. In a letter to the boards of the Federal Reserve System, the Federal Deposit Insurance
Corporation, the Office of the Comptroller of the Currency, and the National Credit Union Administration, Tammy Baldwin of Wisconsin and South Dakota Senator John Thune said many farmers have experienced financial stress due to declining net farm
income, trade uncertainty and last year's difficult growing season. As a result, they feel is it important to give lending institutions more flexibility to help prevent more farm bankruptcies.
Specifically, the senators are asking the federal government to lift regulatory restrictions on local financial institutions to ensure farmers have tools to be successful.
The letter further stated that banks should be given the incentive to work with their farm clients to restructure loans and maintain their farming operations in these challenging times.
"We remain hopeful that the agriculture economy will begin to improve, particularly as new trade agreements are put in place," the letter stated. "In the meantime, however, we believe financial regulators can help farmers and ranchers by ensuring community
financial institutions have adequate regulatory flexibility to meet their needs."
Baldwin and Thune say they are concerned that policies like arbitrary concentration limits on agriculture portfolios can restrict a bank's lending authority to help struggling farmers.
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