Ohio-based Heartland Bank has now developed policies for the agribusiness lending programme it launched in November last year.
The size of Heartland’s loans, which may have up to 20 year terms, will vary from business to business, Scott McComb, Heartland’s chairman, president and chief executive, told Agri Investor.
It is the latest US institution to enter the agri lending sector and joins groups like Prudential’s ‘Agricultural Investments’ arm in providing financing for agriculture projects and agribusiness initiatives.
Heartland is based in Ohio, where agriculture is one of the state’s largest industries and ripe for small business lending. About 75,000 farms operating in Ohio produce over $10 billion of total sales, according to the 2012 USDA Census of Agriculture.
Smaller agri businesses “have the greatest need for investments and offer the largest opportunity for business partners like banks, traders and investment funds” according to ScopeInsight, an agriculture consultancy that noted the “total average annual net investment need for this target group, also known as the ‘missing middle’, is estimated to be at least $83 billion globally”.
Joel Oney, vice president and manager of agribusiness lending, currently leads Heartland’s agri lending team. He worked previously for Farm Credit, a network of borrower-owned lending institutions, where he amassed nearly 20 years of agricultural lending experience with Ohio and Kentucky farmers.
The bank is currently hiring for one additional professional. McComb said as the programme matures, it plans to hire additional resource.