Understanding the Proposed Sale of Farm Credit Services of America
About This Site On July 30, 2004, Rabobank, a Dutch financial institution, announced its intention to purchase Farm Credit Services of America (FCSA). A short time later, a counter offer was announced by AgStar, another Farm Credit System bank located in Minnesota. On Thursday, Oct. 21, 2004, the FCSA Board terminated the acquisition negotiations with Rabobank and also rejected consideration of AgStar's merger offer. These actions, unprecedented in the 87-year history of the cooperative Farm Credit System, created a strong demand for objective, timely information and analysis on the specifics and consequences of the options facing FCSA members and other stakeholders. This site was developed to provide information, analysis and links to resources that would be of value to FCSA members, as well as with other interested parties. Although the sale of FSCA is no longer being considered, there are a number of longer term managerial and policy issues that remain to be considered. As a consequence, we will continue to make the site available and add material that addresses emerging issues. Overview and Background Reports FCSA Rejects Rabobank and AgStar Offers, article by Neil E. Harl published in November issue of Ag Lender [33K .pdf file, 1 page] Rabobank Buyout of FCSAmerica, article by Neil E. Harl, published in Sept. 10, 2004, issue of Farm Bureau Spokesman [100K .pdf file, 4 pages] FCS History [160K .pdf file, 7 pages] FCS of America's Organizational Choices: Sale to Rabobank, Merger with AgStar, or Status Quo? article by Peter Barry [50K .pdf file, 15 pages] Frequently Asked Questions and Commentary Congressional Statements of Policy What are the Differences Between Cooperative Banks and Investor-Owned Banks? What is the Farm Credit System's Relationship to the Federal Government? How Are Financial Institutions Sold? Rabobank How Has FCSA Performed Compared With Other Banks? Who Owns the Surplus? Why Sell the Bank? Options for FCSA Members The "Exit" Fee Income Tax Implications Voting on the Resolution to Terminate System Status Dissenter's Rights What is the Competitive Environment for Agricultural Loans in the FCSA Trade Area? Alternative Proposals AgStar Financial Services Proposal [15K .pdf file, 1 page] Related Links The Rabobank Group Farm Credit Services of America U.S. House of Representatives Committee on Agriculture Review of the Farm Credit System hearing Sept. 29 Hearing Transcript Agribank, FCB, wholesale lender and provider of business services to Farm Credit Services An Agribank analysis and estimate of the costs of re-establishing service in the FCS territory. [450K .pdf file, 1 page] The Farm Credit Council (national trade association and lobbying organization for the Farm Credit System) Farm Credit Administration (U.S. government agency responsible for the regulation of the Farm Credit System) News report on the resignation of FCSA President Jack Webster, as reported in the Des Moines Register.	Author Information Neil E. Harl, Charles F. Curtiss Distinguished Professor in Agriculture & Emeritus Professor of Economics, Member of the Iowa Bar; and Director, Center for International Agricultural Finance Robert W. Jolly, Professor of Economics Roger G. Ginder, Professor of Economics Peter J. Barry, Professor of Agricultural Finance, University of Illinois, Urbana-Champaign . Please Note: Information posted on this website is believed to be correct and has been reviewed by individuals other than the authors. Errors will be corrected promptly. Those accessing the website are encouraged to notify the author of the specific item of any errors observed. The contents of the website represent the reasoned conclusions of the authors and do not represent the views, positions or conclusions of Iowa State University, its College of Agriculture or the Department of Economics at Iowa State University.
Last Update: April 5, 2005