McLEAN, Va., March 27, 2019 — The Farm Credit Administration is encouraging Farm Credit System (System) institutions to work with System borrowers who have been affected by the extensive flooding in the Midwest.
The mid-March “bomb cyclone” dropped heavy rain and triggered massive snowmelt, which led to widespread flooding in the Midwest, particularly in Nebraska and Iowa. Known damages include loss of livestock, production facilities, and grain in storage. Also, saturated soil is adversely affecting preparations for spring planting.
System institutions can alleviate stress for borrowers affected by natural disasters in several ways:
- Extending the terms of loan repayments
- Restructuring borrowers’ debt obligations
- Easing some loan documentation or credit-extension terms for new loans to certain borrowers
“FCA regulations and the solid financial position of System institutions offer considerable flexibility in providing disaster relief,” says Dallas P. Tonsager, FCA board chairman and CEO. “We encourage institutions to use this flexibility following disasters like this one to help borrowers get back on their feet.” For more information, see FCA’s policy statement on disaster relief efforts by Farm Credit System institutions.
In addition to bringing hardship to System borrowers, disasters may also impair the ability of System institutions to comply in a timely way with regulatory reporting and publishing requirements. Institutions should contact the director of FCA’s Office of Examination if they need relief from specific regulatory or reporting requirements.