Lone Star Ag Credit is part of the nationwide Farm Credit System, which was established by Congress in 1916 to provide farmers and ranchers with a reliable source of credit during good times and bad. It is a network of borrower-owned lending cooperatives and specialized service organizations that provide credit and related services for agriculture and rural America. Together, they form the largest single source of rural financing in the country.
There are four wholesale Farm Credit banks throughout the nation. Each bank is owned by a group of local retail cooperatives, which in turn are owned by farmers, ranchers, agricultural co-ops and other eligible borrowers, including agribusinesses, rural landowners and rural homeowners. Lone Star Ag Credit’s wholesale funding bank is the Farm Credit Bank of Texas.
The wholesale banks receive their funding from the sale of Farm Credit securities in the capital markets. They in turn provide funding to the local retail cooperatives, which make loans to customers in agriculture and rural America. After their customers pay back their loans, the local lending cooperatives repay the banks, which then reissue the funds to investors through the Federal Farm Credit Banks Funding Corporation.
Ultimately, all the benefits that we receive as part of the Farm Credit System are passed along to you, our member-stockholders.