Effects of holding company affiliation on loan/deposit relationships in agricultural banking

Barry, P.J.; Pepper, W.H.

Effects of holding company affiliation on loan/deposit relationships in agricultural banking

1985

Barry, P.J. | Pepper, W.H.

Extract: This study evaluates the effects of holding company affiliation on the lending capacity of agricultral banks in Illinois and Iowa, two strong agricultural states that differed in their holding company authorizations in the 1970s. A regression model relating loan-to-deposit ratios to selected bank and agricultural variables was formulated and tested empirically using 1978 data. Results indicated that holding company affiliation was positively related to the loan-deposit ratio, indicating that the higher average ratios in Iowa agricultural banks were due in part to the state's higher incidence of affiliate banks compared to Illinois.

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