Report: Farm bank lending increased in ’25

Farm banks held $122 billion in ag loans last year, up nearly 7 percent from 2024, according to the American Bankers Association 2025 Farm Bank Performance Report. Total loans at farm banks rose 6.7 percent in 2025 to $374.9 billion, outpacing the 6.0 percent annual growth for the broader industry. .The 536 farm banks in the Plains saw the strongest growth in ag lending, according to the ABA, rising 8.3 percent or $3.6 billion to $47.02 billion. Farm loans increased 5.8 percent or $3.16 billion on an annualized basis to $57.69 billion for the 649 farm banks in the Corn Belt. Farm banks in the South increased farm lending 7.02 percent or $717.85 million on an annualized basis to $10.94 billion. Banks had $212 billion in farm loans at the end of last year, 35.7 percent of total agriculture credit, according to the May 6 report. Of that, the nation’s 1,372 farm banks — those with a ratio of domestic farm loans to total domestic loans at least equal to the industry average — accounted for 57 percent of bank farm loans.Total net year-over-year income at farm banks increased 21.3 percent to $7.1 billion, while net interest income rose 15 percent to $15.1 billion. Strong profitability came as farm lending is expected to decrease this year. According to the USDA, farm sector profits are projected to fall 2.6 percent or $4.1 billion in 2026. If realized, that would be 24.1 percent under the record-high profitability in 2022. Inflation-adjusted net cash farm income is projected to rise 1.1 percent or $1.7 billion to $158.5 billion, after a nearly 5 percent increase last year. Other 2025 report findings included:Credit quality decreased after multiple years of historically low delinquency rates, according to the ABA. Noncurrent agriculture loans remained low.Tier 1 capital at farm banks increased nearly 8 percent or $4.4 billion to $59.7 billion. The vast majority of farm banks were profitable, according to the report, with 73.1 percent seeing higher earnings than the previous year. Outstanding loans secured by farmland rose 5.6 percent to $69.1 billion from $65.4 billion the previous year. Farm production loans increased 8.4 percent to $53.1 billion. Land values increased after remaining steady for several years, according to the report. Farm banks held 627,621 small farm loans worth $45.5 billion at the end of 2025.