Things were pretty good down on the farm last year, but there could be some rough rows to hoe in the months ahead, the president of the Farm Credit Bank of Baltimore said yesterday.
Looking back on the past year, Gene L. Swackhamer told 450 shareholders attending the bank's annual meeting yesterday that the local bank posted the highest growth in loan volume among the dozen regional divisions that make up the national Farm Credit System, a cooperative banking institution for farmers.
But the amount of loans the bank expects to go unpaid -- $57 million to $58 million -- is at its highest level since the mid-1980s, Mr. Swackhamer said. Three years ago, the amount was $27 million, he said.
"In hindsight, it looks like we made some loans we shouldn't have made," said Richard A. Chaffinch, senior vice president.
Mr. Swackhamer noted that loans classified as troubled, but not necessarily delinquent, now account for about 10 percent of total loans, up from about 8 percent in 1990.
"Our credit quality is OK," said T. Edward Lippy, chairman of the local bank. "But we are seeing signs that it needs attention."
Mr. Swackhamer attributed the rise in loan volume to the growth of livestock operations, including poultry and hogs, and the expansion in nursery, landscape and horticulture activity.
Loan volume totaled $3.3 billion last year, up from $3.1 billion in 1990, he said.
The bank posted a 60 percent increase in income, to $27.8 million from $17.3 million in 1990.
With 44 percent of agricultural loans in its area, the local bank ranked highest in the nation in that category.
The Baltimore bank serves Maryland, Pennsylvania, Delaware, Virginia, West Virginia and Puerto Rico.