TRADE ASSOCIATE UPDATE - re-post - Original posting June
2008
RABO AGRIFINANCE
Offering much more than just the typical loan
People who work for FFVA Trade Associate member Rabo AgriFinance feel
lucky.
Rabo AgriFinance is one of three units of Netherlands-based Rabobank,
the world’s seond-largest bank. Founded in 1898 by a group of
Dutch farmers, the bank expanded internationally over the years and has
had a U.S. presence since 1981. The AgriFinance division began in 2003
with the purchase of El Centro, Cal.-based Valley Independent Bank and
the acquisition of St. Louis-based Lend Lease Agribusiness and Cedar
Falls, Iowa-based Ag Services of America.
So why do they feel lucky? Eric Bonnett, Rabo AgriFinance’s
relationship manager based in Lakeland, Florida, says it’s simple.
“I’ve worked for other institutions in this business, and
I’ve seen the various loan packages that different lenders
offered. Rabobank always put out the most complete loan packages of
anyone. So after the acquisitions and merger, they needed someone to be
a field lender in Florida. I got lucky.”
When Bonnett says “complete loan package,” he emphasizes
that lending is only one part of what the division offers – a wide
range of products and services that agri-business customers needs.
Those include operating lines of credit, real estate loans, crop and
livestock insurance, and vendor-supplied credit. In addition,
customers have access to all the services offered by Rabobank, a
full-service retail bank headquartered in California.
“What we’re probably most excited about is that we can
integrate various types of products and offer the full banking
spread,” said Bonnett. “Other companies may offer long-term
loans, but they don’t necessarily offer operating lines of credit,
for example,” he said. “We offer both."
Another way Rabo AgriFinance stands out is by offering what it calls
a “credit sweep,” which has been successful in the southeast
with producers who borrow operating capital on a seasonal basis
that’s tied to a deposit account. “Every time you deposit
checks into the deposit account, those balances will ‘sweep’
overnight to pay down the line of credit, which effectively reduces the
borrower’s interest expense over time,” said Bonnett.
“It allows those principal balances that would normally be sitting
in a deposit account to sweep to pay down your line of credit for at
least a few days. And then the account is re-funded when a check is
presented for payment.”
“That’s one of the nice things about being a part of the
Rabobank group,” added Tad Mozena, who heads the division’s
communications efforts. “Rabo AgriFinance itself specializes in
our ag loan products, and then under the Rabobank umbrella, you’ve
got the retail bank that provides a lot of cash management services to
our customers. Basically, we team up to provide a whole array of
financial services to just about all levels of operation,” said
Mozena. “Rabobank gives you a lot of arrows in your
quiver.”
Another side of the business Mozena feels is unique to Rabo
AgriFinance is the unit’s Food and Agribusiness Research and
Advisory Group. “They’re strictly food and agricultural
research analysts. They don’t make any loans, they don’t
approve or review credit. Their job is solely to analyze the issues,
trends, markets and information that impacts the ag industry—al
sectors – and provide reports and data to our clients and to our
employees so we can truly keep our customers and employees knowledgeable
and up-to-date about what’s happening in all different sectors of
agriculture,” said Mozena. “It’s a wonderful resource
they can use it for pro-active decision making.”
Another example of Rabo AgriFinance’s original approach to
serving its customers is vendor financing. The company partners with
leading seed companies, distributors and retailers to provide credit to
facilitate product sales, while eliminating the usual risks associated
with offering credit. Rabo AgriFinance guarantees payment directly to
each vendor on all authorized transaction.
For additional information on all that Rabo AgriFinance provides to
its Florida customers, contact Eric Bonnett at (863) 648-4047 or via
email at Eric.Bonnett@RaboAg.com.
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