Financial Health of Agricultural Lenders
Recent turmoil in financial markets heightened awareness of the importance of credit availability. Many of the US' largest financial institutions have experienced severe financial stress, and credit availability has decreased. With decreased access to credit, US consumers have reduced consumpti...
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Veröffentlicht in: | American journal of agricultural economics 2009-12, Vol.91 (5), p.1406-1413 |
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Format: | Artikel |
Sprache: | eng |
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Zusammenfassung: | Recent turmoil in financial markets heightened awareness of the importance of credit availability. Many of the US' largest financial institutions have experienced severe financial stress, and credit availability has decreased. With decreased access to credit, US consumers have reduced consumption, business investment has slowed, and the economy has slid into a severe recession. The problem is self-reinforcing as the recession has further reduced credit availability, making the general economic slowdown deeper. Many observers have wondered how these conditions will influence the availability of credit to the agricultural sector. Like the broader economy, agricultural markets have seen considerable uncertainty. The agricultural sector has had experience with a financial crisis. The financial stress of farm borrowers spread to agricultural lenders. Agricultural lenders' current financial condition is largely dictated by the quality of their balance sheet, profitability, and cash flow. Today's agricultural lending environment continues to change in unpredictable ways. The amount of uncertainty that exists in financial, commodity, and agricultural markets makes for a difficult lending environment. |
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ISSN: | 0002-9092 1467-8276 |
DOI: | 10.1111/j.1467-8276.2009.01356.x |