Jon Prior

So far farm loans are holding up well, but bankers gathered at an industry conference this week said they are growing increasingly concerned that credit quality will weaken if the U.S. and China don’t reach a deal soon.

It hasn't stimulated loan demand in ways banks hoped it might, and some CEOs fear future rate cuts might cause companies to hunker down.

JPMorgan CEO Jamie Dimon said at an investor conference that the Trump administration's plan for Fannie and Freddie would provide more opportunities for financial institutions. He also called for an end to the U.S.-China trade war and weighed in on the prospect of interest rates falling to zero.

President Trump is expected to sign legislation soon that would expand the number of farmers who could file under the more lenient Chapter 12. Ag lenders are worried because farm bankruptcies recently rose and the trade war with China could worsen.

Farmers were already taking on more debt to cover losses from falling crop prices. New tariffs and other retaliatory moves could hurt ag borrowers further and lead to loan losses and tighter underwriting.