Agricultural Lending School
This comprehensive four-day Agricultural Lending School will cover Farm Tax Analysis and Interpretation; Price Risk Management in Agricultural Production; Machinery, Land and Livestock Lending; Risk Rating and Commodity Futures and Options; and Loan Documentation for Ag Lending (including the key changes under revised UCC Article 9 as it relates to agricultural security interests).
Click Here for School Locations and Hotel Accommodations
OCTOBER 22-26, 2017
Holiday Inn & Suites
8511 Hudson Boulevard
Lake Elmo, Minnesota
Students are responsible for their own hotel accommodations. Please call the hotel at 866-294-6250 for the discounted room rate of $111/night.
Click Here for School Agenda and Schedule Information
This comprehensive four-day Agricultural Lending School will cover Farm Tax Analysis and Interpretation; Price Risk Management in Agricultural Production; Machinery, Land and Livestock Lending; Risk Rating and Commodity Futures and Options; and Loan Documentation for Ag Lending (including the key changes under revised UCC Article 9 as it relates to agricultural security interests)., will be covered.
- Our nationally-recognized facilitators are top-notch in their fields and you will have plenty of opportunity to share your questions.
- This School is interactive, which creates an environment that empowers you to learn.
- You will receive a graduation certificate to document your ongoing commitment to your banking education.
- You will return to your bank a better asset and have new and valuable tools and skills in the agricultural lending area.
- Back, due to great reviews from previous years — AG 101 Supper with Dr. Paul Gorman & Wally Thomas the evening prior to the start of the school.
- The Supper Meeting includes a discussion of “how Ag Lenders can help young farmers get started”, and is a great networking opportunity prior to the school.
- Financial Ratios of Leasing vs. Purchasing and the effects upon ratios.
- Guest Speaker: David Bau, University of Minnesota Extension Educator, Agricultural Business Management
AGRICULTURAL LENDING SCHOOL SCHEDULE
Sunday – 6:00 pm
KICK-OFF DINNER WITH STUDENTS AND INSTRUCTORS
Monday – 8:30 am – 5:00 pm
USING BALANCE SHEETS AND FARM TAX RETURNS FOR LOAN ANALYSIS
This session is designed to aid agricultural lenders and staff in overcoming the challenges of performing loan analysis and risk rating when the borrower submits balance sheets and tax returns in lieu of complete accrual accounting reports or complete cash accounting reports with accrual adjustments. Farmers, as cash tax filers, have unique opportunities to ‘manage’ tax liabilities. Often the Schedule F is inadequate for purposes of analyzing profitability. Dr. Gorman will cover many reasons for these inadequacies and ways of working around them.
TOPICS include: Case Study Farm narrative and balance sheet without deferred liabilities, Case Study Farm balance sheet with deferred liabilities, Case Study Farm 2016 income tax return-Version 1, Case Study Farm 2016 Income tax return-Version 2,Excel Worksheet-V1 & V2 & 2017 FINBIN compared, Challenges of using Schedule F in borrower analysis, Pitfalls of Schedule F when used for calculating financial ratios & risk rating, Comparing V1 & V2 tax returns using Financial Long-Range Budgeting (FinLRB),Ratio Analysis & Interpretation in Excel, Farm Tax Update for 2016-17, Crop & Livestock Enterprise Analysis with Finbin & RankEm, Integrated Production & Financial Accounting for Farmers, Financial Ratios of Leasing vs. Purchasing and the effects upon ratios, Q & A session.
Tuesday – 8:30 am – 6:00 pm
UNDERSTANDING RISK MANAGEMENT / MULTIPLE ENTITIES & AGRIBUSINESS WITH DUAL RISK RATING
In this session participants will gain an understanding of how to integrate Federal Crop Insurance, and Commodity Credit Corporation Loans into a Marketing Plan. These three concepts are an integral part of understanding how Agricultural Lenders and staff can partner with their clients to manage commodity price and production risk.
This session will take Financial Analysis to the next level as real case studies will be discussed on how to analyze financial performance of Multiple Production entities and Agribusiness. Participants will gain hands on experience with analyzing credit needs of farms and agribusiness and incorporating the 5 C’s of credit into typical risk rating models. There will be evening case study problems to gain a further understanding in credit analysis which will be reviewed during the Wednesday morning session.
TOPICS include: Discussion on Federal Crop Insurance, CCC Loans and treatment as loans versus income, Marketing Plans, Advanced Analysis & Risk Rating, Evening Case Study Problems with Profitability, Liquidity, Solvency Ratio Calculation
Wednesday – 8:30 am – 5:00 pm
BRINGING CREDIT ANALYSIS TOGETHER & IN-DEPTH LOOK AT COMMODITY FUTURES & OPTIONS
This session will be a hands on session for bankers to present their findings on case studies worked on in the evening session including determining a final risk rating of the case study. Time will also be spent on the specifics involved with evaluating machinery, livestock and land loans.
The key strength to this afternoon session is the emphasis on understanding brokerage statements to help Ag Lenders and their customers understand potential contingent liabilities. Suggestions for setting hedge loan covenants will be included.
TOPICS include: Machinery & Livestock Lending and Land Loans, The Futures Contract, Hedging Fundamentals with Futures, Futures & Hedging for Sellers/Producers & Buyers/End Users, Options & Hedging for Sellers/Producers & Buyers/End Users, Applied Strategies Practice Session, Managing Your Hedge Loan Portfolio, Q & A Session
Thursday – 8:30 am – 5:00 pm
AGRICULTURAL LOAN DOCUMENTATION
Poor loan documentation can cost your financial institution thousands of dollars each year. Unfortunately, the importance of effective loan documentation is most apparent when it is already too late. This portion of the Agricultural Lending School focuses on the major concepts, specific requirements and common problems in the specialized field of agricultural loan documentation with particular emphasis on avoiding loan losses due to faulty documentation. The ‘hands-on’ approach allows you to return to work and apply what you have learned.
Throughout the program the problem method will be used to challenge the participants in important areas of agricultural loan documentation. Participants will learn a step-by-step process to recognize problems and take action to prevent loan loss exposure from faulty documentation. Important “due diligence” procedures leading to loan closing will be discussed including proper borrower entity identification and authority to sign loan documents.
Understanding Revised Article 9 of the UCC is essential to the agricultural lender. All 50 states have adopted this comprehensive commercial law which governs the perfection of security interests in all types of farm collateral both tangible (e.g. crops, livestock and farm equipment) as well as intangible (e.g. USDA entitlement payments). The interaction between Article 9 security interests and state agricultural liens, which are now included under the expanded scope of UCC Article 9, will be covered along with recent important uniform amendments that have now been in effect for over a year. Finally, the program will address various purchase money security interests governed by Article 9, including PMSI in livestock.
The basic requirements of securing loans with real estate will be examined, including such problems as perfection, future advance clauses and loan renewals. Participants will be exposed to proper ‘due diligence’ procedures when a loan is secured by real estate including the use of title insurance, surveys and environmental audits.
Click Here for School Faculty
DR. PAUL GORMAN, owner of ELCEL Solutions, Inc. located in Minnesota, is a Farm Business & Financial Consultant with over 40 years experience in the agriculture industry. Dr. Gorman earned his B.S. in Agricultural Education from South Dakota State University and Ed.D from the University of Minnesota. Prior to private consulting, he taught Farm Operations and Business Management for technical colleges in Iowa and Minnesota.
LEWIS C. LADERER, JR., J.D. is a partner in the law firm of Laderer & Fischer, P.C. in Indiana. Laderer & Fischer focus their practice almost exclusively on the representation of commercial banks and other commercial lenders in the areas of banking law, commercial litigation, and bankruptcy. Mr. Laderer has extensive experience in assisting community banks in structuring loan transactions, developing loan contracts, and management of problem loans and bankruptcies. Mr. Laderer has been practicing law since 1968.
WALLY THOMAS has been in Agriculture Lending for over 23 years. Currently he is Vice President of Agriculture and Business Banking for Bremer Bank in Mankato MN and serves as a team lead. Prior to starting his banking career, he was involved in Agriculture Education as an instructor for Post- Secondary and Adult Education. He has his Bachelors and Masters of Science in Agriculture Education from NDSU. Wally was raised on a dairy farm in North Dakota.