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Date of Award
Master of Science (MS)
Economics, Finance, & Accounting
From 1950 to 1966 there occurred a tremendous increase in the credit requirements for agriculture in the Tenth Federal Reserve district. The banking system has traditionally been the foremost financier of agriculture in the Tenth District, but is losing its relative importance due to the fact that it is limited in granting loans to a size not to exceed ten per cent of its capital and surplus to one individual. This limitation is extremely significant when it is viewed in the light of the fact that agriculture's individual loan requests in excess of $25,000 have increased some 287 percent, while the number of rural national banks which cannot make a loan of that size was 52 per cent in 1966. The writer examined some of the alternative solutions which have been proposed, such as the decreasing of the liquidity of rural national banks to allow more money for agricultural loans, a more efficient use of the correspondent banking system now in existence, agriculture credit corporation use, and the adoption of unified markets and bank holding companies. It was found that all of these solutions had significant flaws which impeded their use fullness in solving the loan-limit problem. The writer's solution was that statewide branch banking should be adopted inasmuch as this solution would for all practical purposes alleviate the loan-limit restriction. After dealing with the usual objections against branch banking, all of which were discovered not to be based on any significant facts, the writer concluded that his hypothesis of statewide branch banking would provide a total solution to the problem of adequately financing agriculture in the Tenth Federal Reserve District.
Copyright 1969 Van Robert Hoisington
Hoisington, Van Robert, "Statewide Branch Banking : An Alternative Solution to Inadequate Financing of Agriculture by Rural National Banks in the Tenth Federal Reserve District" (1969). Master's Theses. 1209.