Industry Analysis & Industry Trends
The Agricultural Banks industry did not fare well through the recession. Five consecutive years of losses will be followed by one more in 2014, with positive growth returning to the industry in the next five-year period. Despite these negative losses, the industry managed to turn profit around sooner by restructuring to run a more efficient business. The next five years look to be more successful, as the economy recovers and the agricultural price index (API) rises. As the API rises, farmers will more readily pay loans in a timely manner, proving profitable for industry establishments.... purchase to read more
Industry Report - Industry Investment Chapter
The Agricultural Banks industry operates with a low level of capital intensity. IBISWorld estimates that for every $1.00 spent on wages, the industry will allocate $0.02 to capital investment. This 2014 figure represents a slight decrease from $0.05 in 2009. Industry operators extensively rely on a range of highly talented and skilled employees, including analysts, accountants, auditors and loan officers. The educational backgrounds required of these employees largely explain the industry's high and increasing average wage.
Yet, despite the industry's low level of capital intensity, a range of capital expenditures are required to successfully operate as an agricultural bank. Industry participants have invested heavily in branch networks as a means to distribute their services... purchase to read more