Farm Credit Services of Hawaii ACA
Offers Flexible Agricultural Loans

Farm Credit Services of Hawaii is a Hawaii-based financial association that provides mortgage and operating loans exclusively to farmers, ranchers, fishermen, nursery owners and country home owners throughout the Islands. Farm Credit Services of Hawaii ACA is comprised of the Federal Land Bank Association of Hawaii, FLCA and the Hawaii Production Credit Association.

The Federal Land Bank Association, FLCA provides long-term loans, usually for land. The association finances the purchase of open land and improved land, the construction of new farm and ranch projects, new homes in the country and home improvement projects on country homes. The association also refinances existing agricultural mortgages. On the other hand, the Hawaii Production Credit Association offers shorter-term loans to finance new equipment, inventory and other capital improvements for agriculturally related businesses.

According to Ted Tokunaga, president and chief executive officer of Farm Credit Services of Hawaii ACA, the Federal Land Bank Association of Hawaii, FLCA and the Hawaii Production Credit Association, Farm Credit Services of Hawaii is unique in Hawaii due to its understanding of farmers and its sensitivity to their particular problems and needs.

"We know that farming can be a very risky business," he notes. "We fully understand the risks farmers take due to such factors as unpredictable weather conditions, marketing problems and business challenges, including increases in such costs as fertilizers and labor, labor shortages, and airline or shipping strikes which may make it difficult for farmers to market their products. In addition, since farming is very physical, we realize that farmers may experience personal health problems, such as strokes and heart attacks, that may impact their production."

Tokunaga adds that Farm Credit Services of Hawaii ACA custom designs loans to meet the special needs of its clients.

"We offer very flexible and attractive loans and are capable of restructuring loans in progress if necessary," he says. "If one of our borrowers ever gets into trouble, we have the means to assist him by restructuring his loan to allow him to continue to farm, rather than to go under."

"For example, after Hurricane 'Iniki' battered Kauai, about six of our clients on the Garden Island sustained major damage to their operations. To help them out, we granted them forebearances that waived the normal conditions of payment on their loans and gave them more time to make their payments. Then, when the farmers got back on their feet a few months later, we reactivated their notes. Through this process we gave the farmers a chance to rebuild their operations and service their debts under normal, rather than extenuating, circumstances."

The Federal Land Bank Association of Hawaii was established in Honolulu in 1966. Owned and directed by its members, the association is part of the Farm Credit System, a nationwide lending institution which has serviced the agricultural community across the continental United States since 1917. The Hawaii Production Credit Association was established in Honolulu in 1976. On July 1, 1996, the boards of both associations approved joint management and established Farm Credit Services of Hawaii.

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Note:
"FLCA" stands for "Federal Land Credit Association." A federal land credit association is a stand-alone, direct lending association. FLCAs were created in the United States when Congress passed the Farm Credit Act of 1971.