EXHIBIT L Spokane Please provide the number of credit denials made for the years 1981 through the present time. *These are loans where an application was signed by the borrower, registered and then denied. **Not available (4/1-12/31) as yet. What percentage of credit denials would you estimate was made to existing Farm Credit System borrowers? 60-70% What percentage of the borrowers denied production credit would you estimate has sought credit from Farmers Home Administration? Unknown What was the primary reason for denying credit? FLB PCA Insufficient security margin and inadequate repayment capacity. Did not meet requirements, such as nonviable operation or inability to service debt. REVOLVING FUNDS Mr. WHITTEN. The Farm Credit Act Amendments of 1985 merged the Farm Credit Administration's two revolving funds and gave the Farm Credit Administration discretionary authority to use the new fund to purchase stock in the Capital Corporation. How much money is now in the revolving fund? Mr. NAYLOR. $259.799 million. Mr. WHITTEN. What is the volume of loans purchased from other Farm Credit System institutions by the Farm Credit Capital Corporation? Mr. NAYLOR. It is my understanding from inquiries made by FCA on your behalf of the Farm Credit System Capital Corporation that the institution is now holding $106 million in loans purchased from other institutions. The Corporation is also completing the details on the purchase of approximately $750 million in loans from the Wichita District of the Farm Credit System and is close to a major purchase in the Omaha District, according to Capital Corporation officials. FARM CREDIT ADMINISTRATION BOARD Mr. WHITTEN. Please list for the record the members of the Farm Credit Board. Mr. NAYLOR. The members of the Farm Credit Administration Board are Chairman of the Board Frank W. Naylor, Jr. (Republican), Member of the Board Marvin R. Duncan (Republican), and Member of the Board Jim R. Billington (Democrat). AGRICULTURAL CREDIT OUTLOOK Mr. WHITTEN. Please provide for the record a copy of the report entitled "Agricultural Credit Outlook for 1987." Mr. NAYLOR. A copy will be provided for the record. [CLERK'S NOTE.-The report was provided to the Committee. It is too lengthy to reprint in the record, but will be retained for the files.] LENDING LEVELS Mr. WHITTEN. What trends do you see in the level of your lending over the next five years? Mr. NAYLOR. The FCA is currently working on a financial forecasting model of the System's condition over the next 5 or more years. Preliminary results indicate that the System's loan volume would remain at or slightly above its current levels. We will be able to provide the subcommittee more information once that forecast is completed. NET FARM INCOME Mr. WHITTEN. Please submit for the record an update of the chart and table on net farm income appearing in last year's hearing record. Mr. NAYLOR. We will provide the committee with that updated chart and table. [The information follows:] FARMERS HOME INTEREST RATE WRITE-DOWN PROGRAM Mr. WHITTEN. Do you have any information on the number of Production Credit Associations participating in the Farmers Home interest rate write-down program? Mr. NAYLOR. No, the FCA does not collect this information from PCAS. The FCA has encouraged System institutions to participate in FmHA programs whenever appropriate. We have informed the System of the subcommittee's interest and asked them to provide any information that may be of assistance to you. FARM CREDIT COUNCIL. The number of Production Credit Associations participating in the FmHA interest rate buydown program is not reported to the Farm Credit Corporation of America. Therefore, we are unable to provide the number of PCAs participating in the program. Mr. WHITTEN. What is the number and dollar value of the loans on which PCAs have participated? FARM CREDIT COUNCIL. As of December 31, 1986, the Farm Credit System reported having 64 loans totaling $8.4 million in the interest rate buydown program. Mr. WHITTEN. Have the PCAs experienced any problem participating in the program? Please explain in some detail for the record. FARM CREDIT COUNCIL. The borrower eligibility requirements and lender restrictions limit the use of this program. The lender, for example, must demonstrate that a positive cash flow projection is not possible without reducing the interest rate on the borrower's loan. Furthermore, if a positive cash flow can be achieved using rescheduling or reamortization, the borrower is not eligible for an interest rate buydown. In addition, for a borrower to be eligible a typical plan of operation must show that a positive cash flow can be expected during the entire buydown period as well as for the term of the loan exceeding the buydown period. There are a very limited number of borrowers that meet all these criteria. FARMERS HOME OPERATING LOAN GUARANTEE PROGRAM Mr. WHITTEN. Do you have information on the number of loans and dollar value of those loans made by PCAs with a Farmers Home Administration guarantee? How does this differ from last year? Mr. NAYLOR. The FCA does not have this information. We have, however, advocated that the System participate in FmHA guarantees whenever they are appropriate and would help the lender and borrower. FARM CREDIT COUNCIL. [The information follows:] |