Farm banks remain key lenders while supporting small farms and rural communities
Farm banks continued to play a major role in supporting U.S. agriculture during 2025, according to the American Bankers Association’s 2025 Farm Bank Performance Report. Banks provided more than $212 billion in farm loans, accounting for over one-third of all agricultural credit nationwide.
Farm banks, defined as banks with a high share of farm-related lending, held $122 billion in total for farm loans. These banks remained an important source of credit for small and micro farms, which depend on reliable financing for daily operations and long-term growth.
"Farm banks play an outsized role in supporting farmers, ranchers and rural communities," said Ed Elfmann, senior vice president, agricultural and rural banking policy. "This report shows they continued to extend credit responsibly in 2025 while maintaining solid capital levels and strong ties to the communities they serve."
The report showed strong support for smaller farming operations. Banks held more than one million small farm loans worth $71 billion. Micro farms accounted for over 630,000 loans totaling more than $14 billion, highlighting continued access to credit for smaller producers.
Farm banks also maintained solid financial performance. Tier 1 capital increased by nearly 8% in 2025, reaching $59.7 billion. Profitability remained high, with more than 98% of farm banks reporting profits and over 73% earning more than the previous year.
Although loan quality weakened slightly as conditions normalized, noncurrent agricultural loans stayed low compared to historical levels. This shows that banks continued to lend responsibly while managing risk.
Rural employment also grew. Farm banks added more than 2,000 jobs in 2025 and employed over 76,000 people across rural America. Many of these banks have long-standing community ties, with the average farm bank operating for more than a century.
Regional gains were seen across the country, especially in the Corn Belt, Plains, and Southern regions. Overall, the report confirms the important role farm banks play in strengthening U.S. agriculture and rural communities.
Photo Credit: pexels-gabby-k