Files
Abstract
Rapid decreases in the number of Farm Credit System (PCS) loans to farmers during the 1980's severely strained the system. One strain on FCS income was the buildup of its allowance for loan losses. Another strain was on net interest income, which declined due to reduced volume of assets, as well as increased interest rates on debt. Legislation in 1987 reorganized the FCS, provided for up to $4 billion in assistance, and established new FCS institutions. FCS has now slowed the decline in its loan volume and improved its returns. It still faces a long road to complete recovery, with much of the cost of consolidating institutions, bailing out failing institutions, and restructuring loans still ahead.