The US' 3,638 farm banks continued to outperform banks nationwide, with strong earnings driven by increasing loan volume and lower loan loss provisions. Farm banks reported a 1.19% return on assets in 1994. Net interest margins at farm banks narrowed slightly during the year - to 4.37% in 1994 from 4.4% in 1993 - as the Federal Reserve moved to slow the US economy by raising short term rates. Real estate loans remained the fastest growing segment of farm bank lending, rising by 8.7% in 1994.