Agricultural banks and the federal home loan bank system Available to Purchase

Changes within the financial services industry have raised concerns about the ability of agricultural banks to adequately fund local rural development. To address these concerns, the Gramm‐Leach‐Bliley Act of 1999 broadened agricultural bank access to Federal Home Loan Bank (FHLB) financing. Probit analyses indicate that factors related to bank returns and risk management have been significantly associated with agricultural banks joining, and subsequently borrowing from, the Federal Home Loan Bank System.