9 Class Hours

Instructor: Tim Ohlde

The saying “The world is a small place” is more relevant now than ever in U.S. agriculture! This course will take a global view of critical economic factors from around the world and demonstrate the interconnection between them and the agriculture industry. A key component that will be explored is the energy sector. Students will learn how to apply international economic knowledge to their loan portfolio.

A fundamental understanding of energy has never been so important in agriculture lending. This class will take a world view of the opportunities and challenges in the energy industry, and what it means for ag producers, communities, and ag portfolios. Participants will walk around the globe to not only discuss energy and monetary policy tools but also to look at demographics in developed and developing countries and what they mean to GDP in the world and the United States.

One key facet of energy discussions that has a particularly strong tie to agriculture is climate change. Students will learn the history and current international drivers of energy that come into play as the agricultural industry and the world attempt to go green!  Students will study the significance of today’s major world-wide energy players and what it means to move toward green farming.  This includes a look at the impact of the Paris Accord and the evolving dynamics between agriculture and the finance industry.

In this class we will also review 40 years of history of the Federal Reserve and how evolving monetary policy tools have impacted the national economy and how different cycles and trigger points in history have affected agriculture and rural communities.   The Fed has implemented many “tools” over time to influence monetary policy and manage their mandate.  We will discuss what these tools do to not only interest rates but also asset values, and how they affected the international economic scene.

Bank leadership and lenders continue to be challenged to produce and effectively implement a loan presentation system that results in well written loan narratives and communicates the “story” of a loan in a concise yet informative manner. You’ll better understand how to weave overall economic data in to a solid loan write-up; which is more critical because electronic or offsite exams are now common place.  We will learn how to develop and implement an effective loan presentation system that will answer 95% or more of all your regulator’s questions.

Inflation is in the news every day and has certainly impacted agriculture operating expenses and working capital.  For many ag lenders this is the first time working in an inflationary environment.  In this setting, the projected cash flow will be a significant driver of analysis.  Understanding the power and importance of this tool in today’s agricultural environment is critical.  Communicating the results and utilizing the projected cash flow with customers across the portfolio is critical to improving, maintaining, and monitoring credit quality for the balance of the decade.


Annual School Session

Third Year Elective Course

Competency: Lending