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Plains Land Bank Returns $7.1 Million in Cash Patronage to Borrowers

Plains Land Bank, a rural lending cooperative, recently distributed $7.1 million in cash patronage to qualified stockholders based on its strong financial results in 2017.

Because Plains Land Bank is a co-op, its borrowers share in its ownership — and its earnings. The lender retains only enough income each year to operate the co-op, and returns the surplus to its owners as patronage payments.

How our patronage program works

Every borrower buys stock in the lending cooperative equal to 2 percent of his or her loan amount, up to a maximum investment of $1,000. This stock investment helps secure the loan and the Association, and is retired when the loan is paid. Stock ownership also allows borrowers to participate in our patronage program.

At the end of each fiscal year, our board of directors evaluates the performance and financial condition of the Association. Working with Association management, they determine the amount of the patronage dividend, which is paid at the annual stockholder meetings. Since 2005, our Association has returned more than $55 million to our customers.

“We understand that land is an investment, not a get-rich-quick scheme. Some years will be good and others bad, and no matter how much you plan for the season, many decisions will have to be made at a moment’s notice,” said Gregg Lloyd, Plains Land Bank Chief Executive Officer. “Like you, we know that there are no shortcuts to building a legacy.

Plains Land Bank has been around for over 100 years and we are here for the duration. When we pay patronage, we’re basically refunding a portion of the interest that customers paid on their loans the previous year, which effectively reduces their cost of borrowing for the year,” Lloyd said. “That’s a benefit of our co-op business model.”

Plains Land Bank provides mortgage financing for agricultural producers and rural property owners. Part of the nationwide Farm Credit System, the Amarillo-based lending cooperative has branch offices in Amarillo, Pampa, Perryton and Plainview.