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Lender-Borrower Relationships

Over the course of this year, my involvement in nine ag lending schools has allowed me to keep a pulse on practices in the field. At some schools, we conduct lender-borrower panels that are generally the highlight of the educational experience. The following are some perspectives from these panels.

Many panelists would like their lender to visit their operation. While these panelists were not the average producers, having a lender who understands their business, industry and family is important to them.

  • The producers enjoyed a critique and analysis of their financial information. They wanted to know both strengths and suggestions for improvement. If they presented a financial package or business plan that was executed, they expected to be rewarded with a lower interest rate than a borrower who was not as proactive, where the lender had to extract and organize the information.
  • The producers appreciated lenders providing educational opportunities for business improvement. These included seminars on risk management, understanding financial information and family business transition.
  • With much transition occurring in lending staff in the next few years, a smooth changeover or evolution of the working relationship was critical. This also includes the transition of senior management at the lending institution.


Some lenders in this summers’ schools were reluctant to teach their producers about financial information. Why? The common response was if they understand their financial information, they are more likely to go to the competition. Wow! A message to all producers: If you have a lender who takes time and effort to assist you in learning the business, then a little loyalty is expected in return.

Observations from the ag lending field


  • More women ag lenders.
  • More lenders at schools who are in their second careers.
  • More ag lenders also involved in production agriculture, either part time or with families.

Editor’s note: David Kohl, Corn & Soybean Digest trends editor, is an ag economist specializing in business management and ag finance. He recently retired from Virginia Tech, but continues to conduct applied research and travel extensively in the U.S. and Canada, teaching ag and banking seminars and speaking to producer and agribusiness groups. He can be reached at

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