THE EFFECTS OF HOLDING NONFARM RELATED FINANCIAL ASSETS ON RISK-ADJUSTED FARM INCOME

A discrete stochastic, programming model is formulated to study the gains from diversification when farming operations are augmented with off-farm financial assets that are not highly correlated with returns from farming. We extend past research by considering the dynamics of accumulating these financial assets and the farm's leverage and tenure position. Results show that farmers' income level and stability can be improved by including nonfarm financial assets in their portfolios.Agricultural finance, Certainty equivalents, Discrete stochastic programming, Land investments, Off-farm investments, Agricultural Finance,

FACTORS AFFECTING COMMERCIAL BANK LENDING TO AGRICULTURE

A tobit econometric procedure was used to examine the effect of selected demand and supply factors on nonreal estate agricultural lending by commercial banks in Texas. Results show that banks have reduced their agricultural loan portfolios in response to increased use of interest sensitive deposits after deregulation. Moreover, almost half of this decrease came from banks that stopped making agricultural loans. Also, results show that banks affiliated with multi-bank holding companies lend less money to agriculture relative to their assets than do independent banks.Agricultural lending, Commercial banks, Deregulation, Tobit, Agricultural Finance,

COMMERCIAL BANKS' RESPONSE TO COSTLY DEPOSITS IN A DEREGULATED ENVIRONMENT

The study examines balance sheet changes at Texas commercial banks following the 1980 bank deregulation. A comparison of selected deposit and asset variables for 1978 (pre-deregulation) and 1987 (post- deregulation) reveals a rapid increase in costly deposits and a decline in the proportion of loans in general, and agricultural loans in particular, relative to total bank assets. Although a weak Texas economy during this time period contributed to the observed asset reallocation, banks were also responding to the increased deposit costs and interest rate volatility following deregulation. This conclusion is consistent with previous findings cited in the study.Commercial banks, Agricultural loans, Bank deregulation, Financial Economics,

FACTORS AFFECTING COMMERCIAL BANK LENDING TO AGRICULTURE

A tobit econometric procedure was used to examine the effect of selected demand and supply factors on nonreal estate agricultural lending by commercial banks in Texas. Results show that banks have reduced their agricultural loan portfolios in response to increased use of interest sensitive deposits after deregulation. Moreover, almost half of this decrease came from banks that stopped making agricultural loans. Also, results show that banks affiliated with multi-bank holding companies lend less money to agriculture relative to their assets than do independent banks

THE EFFECTS OF HOLDING NONFARM RELATED FINANCIAL ASSETS ON RISK-ADJUSTED FARM INCOME

A discrete stochastic, programming model is formulated to study the gains from diversification when farming operations are augmented with off-farm financial assets that are not highly correlated with returns from farming. We extend past research by considering the dynamics of accumulating these financial assets and the farm's leverage and tenure position. Results show that farmers' income level and stability can be improved by including nonfarm financial assets in their portfolios

COMMERCIAL BANKS' RESPONSE TO COSTLY DEPOSITS IN A DEREGULATED ENVIRONMENT

The study examines balance sheet changes at Texas commercial banks following the 1980 bank deregulation. A comparison of selected deposit and asset variables for 1978 (pre-deregulation) and 1987 (post- deregulation) reveals a rapid increase in costly deposits and a decline in the proportion of loans in general, and agricultural loans in particular, relative to total bank assets. Although a weak Texas economy during this time period contributed to the observed asset reallocation, banks were also responding to the increased deposit costs and interest rate volatility following deregulation. This conclusion is consistent with previous findings cited in the study

COMMERCIAL BANKS' RESPONSE TO COSTLY DEPOSITS IN A DEREGULATED ENVIRONMENT

The study examines balance sheet changes at Texas commercial banks following the 1980 bank deregulation. A comparison of selected deposit and asset variables for 1978 (pre-deregulation) and 1987 (post- deregulation) reveals a rapid increase in costly deposits and a decline in the proportion of loans in general, and agricultural loans in particular, relative to total bank assets. Although a weak Texas economy during this time period contributed to the observed asset reallocation, banks were also responding to the increased deposit costs and interest rate volatility following deregulation. This conclusion is consistent with previous findings cited in the study.Commercial banks, Agricultural loans, Bank deregulation