Partnerships with Commercial Lenders

Maximize Return on Equity
Beginning Farmer bonds and participation loans allow a lender to improve margins by increasing yield on loans. With a reduced rate to the borrower and some additional expertise in programs, lenders can charge additional fees to client. IFA programs often need letters of credit to back bonds…another way to earn additional fee income.

Minimize Risk
Lenders have liquidity, asset quality, management, and capital risks. Liquidity risk can be reduced with use of participation loan program, especially the deposit option. Reducing your credit concentration risk can be accomplished with participation loans. Guarantees on farm loans reduce asset quality risk as you solidify the credit with IFA backing. Purchase of private placement bonds diversify your lenders balance sheet.

Gain Market Share
Expanding and acquiring relationships with your customers is key to remaining independent. Participation loans are being used to incent businesses to expand and lenders to acquire additional loan relationships.

Solidify Customer Relationships
Lending limits often send customers to the competition, and participations can help you expand your lending limits so that you can maintain the entire relationship without limitation. Starting a new operator in business means you have them for life.

Comply with Regulatory Demands
Community reinvestment act provisions may be met with credits to beginning or small operations. Asset quality, liquidity, and earnings concerns can be met with IFA programs.

IFA makes it easy – talk to a Funding Manager at your local IFA office.