Rabobank, the Dutch banking giant that applied last month to buy one of the Farm Credit System's largest lenders, is hitting back at critics of the deal.
One of those critics is CoBank of Denver, the Farm Credit System's largest lender. Among other things, CoBank has said Rabobank might abandon its farm customers in hard times, because it has no congressional mandate to serve farmers, as does Farm Credit Service of America, the $7.6 billion-asset Omaha company that it wants to acquire.
In a letter released Thursday, Rabobank said it has been lending to U.S. farmers and agricultural businesses for 25 years. It also said that it deals in agricultural lending worldwide, so it understands the cyclical nature of the business.
CoBank has attacked the $600 million deal repeatedly since it was announced Aug. 1. In a letter to its shareholders Aug. 6, CoBank said the deal is not consistent with the Farm Credit System's mission and asked them to urge the Farm Credit System's regulator to block the deal.
The deal, scheduled to close in the first quarter, would be the first in which a commercial bank bought a Farm Credit System lender. The transaction requires the approval of the Farm Credit Administration and of Farm Credit Services' shareholders.
The Farm Credit System is a network of borrower-owned lenders that specializes in providing credit to farmers and agricultural businesses.
