Pub. 14 2019-2020 Issue 3

NEBRASKA BANKERS ASSOCIATION 21 Bert Ely's FarmWatch — continued on page 22 Fully registered Dealer Bank • Not FDIC Insured • No Bank Guarantee • May Lose Value FROMONE COMMUNITY BANK TOANOTHER. Country Club Bank Capital Markets Group has assisted community banks build high- grade bond portfolios that reflect specific markets expectations, product preference, income goals and overall risk parameters, since 1985. Operating in over 30 states, the Capital Markets Group is always ready to meet the needs of our fellow community bankers. We keep investing simple so that banks can focus on what really matters— lending to the communities who support us. • Portfolio Strategy, Fixed Income Sales and Service • Bond and Securities Underwriting/Trading • balanCD Brokered CD and TBA Programs We speak the same language. (ACAs) that provided both real estate and non-real estate credit to farmers and ranchers. ACAs then began to structure themselves as “parent ACAs,” each with a PCA subsidiary as well as a Federal Land Credit Association (FLCA) that not only had the lending powers of an FLBA, but could then keep the real estate loans it originated, thereby retaining for each ACA the real-estate tax exemption the FCS has long enjoyed. The 1987 bailout of the FCS, triggered by the 1980s’ ag crisis, led to significant consolidation within the FCS – the number of FCS entities shrank from 845 at the end of 1984 to 196 as of July 1, 1999. The cooperative banks eventually consolidated into CoBank, which has the exclusive authority within the FCS to lend to cooperatively-owned agricultural busi- nesses and rural utilities. Today, the FCS has just four regional banks, including CoBank, and 69 associa- tions. This map features the territories served by the four banks , while this map shows the association territories . The FCS banks, other thanCoBank, act solely as funding intermediaries between the FCS associations and the Federal FarmCredit Banks Funding Corporation, which raises funds by selling in the capital markets notes and bonds known as the Systemwide Debt Securities. As the dominant creditor of the as- sociations it has lent to, each FCS bank provides some financial oversight of those associations. That oversight supposedly complements the regulatory oversight and periodic safety-and-soundness ex- aminations carried out by the FCS’s regu- lator, the Farm Credit Administration. The tremendous variation in the size of the areas served by the FCS associa- tions parallels the enormous asset-size differential among them. As of March 31, 2019, the associations ranged from total assets of $29.88 billion (Farm Credit Services of America, serving four states) and $23.71 billion (Farm Credit Mid-America, serving all or portions of four states) to Delta ACA, which serves just five counties in southeast Arkansas, with $49 million of assets. As the dominant creditor of the associations it has lent to, each FCS bank provides some financial oversight of those associations. That oversight supposedly complements the regulatory oversight and periodic safety-and-soundness examinations carried out by the FCS’s regulator, the Farm Credit Administration.