What the Bank of North Dakota's New Farm Program Says about Banking

What if I told you about a wildly successful bank, one which has made over $104 million in profits this year with more to come? What if I also told you that the bank was in the business of helping people more than it was in the profit-making business? And that despite that public service mandate, the bank regularly outperforms Goldman Sachs and a host of other Wall Street giants?

We're talking about a stunning success of a bank; in fact, it's building a new financial services campus to help businesses out throughout the state it serves.

bank-of-north-dakota.jpgIf you didn't already know what I was talking about (and I'm guessing you do), you'd think it odd that a bank in a singular state that isn't a Wall Street bank would be able to make the claims of business success the Bank of North Dakota can make. And subsequently, unless you'd been reading some about the concept, it might surprise you even more to learn that the Bank of North Dakota is a public bank.

On top of all that, add also this: A new BND program making $300 million available to the state's farmers.

The state Industrial Commission voted Thursday to approve the Bank of North Dakota's new Farm Financial Stability Loan Program.To be eligible, farmers must show evidence of a cash flow shortage in 2014 or 2015 and have an approved operating line of credit from a local lender for the 2016 crop year.The Bank of North Dakota will work with the local lender to restructure the farmer's current debt with lower interest rates and longer payback periods to help the farm operation stay afloat.. . . The program is similar to the bank's Farm Disaster Relief Loan Program created after widespread flooding in 1997 . . .

This is what happens when the public is entrusted with financial decisionmaking. And those $104+ million in profits? They aren't for shareholders. They will never go into private hands. They'll be returned to the State of North Dakota, used for public services and to increase the liquidity and ease the lives of residents of the state.

How were the profits made? Through tiny, tiny interest payments on loans made to small businesses, farmers, students, and entities of the state or its municipalities.

The most successful bank in the country is a public bank, and it's about to help even more people, and preserve farming and food security.

Why aren't there more?public_private_banking.jpg


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