Written By: Leah Chester-Davis, Miles Hamrick, Roger Davidson
Ask Carolina Farm Credit customers Randy Cook and Donna Streich what sets Carolina Farm Credit apart from other lending institutions and each names two major features: the cash dividend or cash dividend program and quality service.
While Cook, from Cleveland County, and Streich, from Iredell County, bring several contrasts to the table – they don’t know each other, they each work with a different loan officer, Cook has been doing business with Carolina Farm Credit since the early 1970s, Streich got her first loan in 2016, their loan amounts are different – they share an enthusiasm for the program.
They know that the tagline “We put our profits in your pockets!” is so much more than words on a page. For any Carolina Farm Credit customer who has received a cash dividend check, you know that too. Those are words Carolina Farm Credit lives by.
Cash dividends, sometimes called patronage, is a benefit that sets Carolina Farm Credit apart from other lending institutions. “We’re the only bank that gives you back money for having a relationship with us, because everybody is an owner or stockholder in the company,” says Miles Hamrick, loan officer in the Shelby and Spindale offices.
“When you borrow money with us, you purchase stock,” explains Miles Hamrick, loan officer in the Shelby and Spindale offices. “That enables you to have the right to take part in a portion of our earnings and voting rights within the cooperative. The stock price is 2 percent of a loan, capped at $1,000 dollars. When you pay off your loan you are paid back for your stock.”
When you become a member you are part of a cooperative and you will receive a dividend or refund based on the interest you paid the previous year. The amounts vary greatly, depending on how much a person borrows, says Roger Davidson, a loan officer in the Statesville office. “Somebody who has borrowed $10,000 to buy a used bush hog or used bailer that they are going to pay back in three years may get less than $100 for a dividend check. But somebody who has a $2 million poultry loan is going to get thousands of dollars.”
The percentage returned to stakeholders each year is based on a decision by the Board of Directors and may vary from year to year depending on factors such as the amount of business Carolina Farm Credit has done through the year, the economy, how well all of the agricultural sectors such as dairy, cattle, poultry, row crops, and Christmas trees are doing.
“Anything you can think of from an ag perspective, the way the economy is doing, is going to impact the performance that a farm credit district has. It’s going to, in large part, determine the decisions the board makes and the amount it believes we can return,” says Davidson.
Carolina Farm Credit hosts an annual appreciation dinner to distribute cash dividend checks, typically in April of each year. If a customer cannot attend, the checks are either mailed or delivered to them by their loan officer. Regardless, it’s a favored time for customers and loan officers alike.
“Look at the opportunity it gives you to get in front of a customer and share good news,” says Hamrick.
Randy Cook says that while he knows he’ll get a cash dividend check each year, he sometimes forgets and the check is always a pleasant surprise.
Davidson says there are always lots of smiles. Donna Streich received her first cash dividend check last year. “Roger told us about the cash dividend program when we got our loan but I didn’t think much about it. I was kinda thinking, yeah, yeah.” She says she thought it was some kind of gimmick. “But when he delivered the check and I opened it, I was shocked!” She speaks enthusiastically of sharing the check with her husband who was equally pleasantly surprised.
Read more about the cash dividend program and Randy Cook’s and Donna Streich’s experience as Carolina Farm Credit members in this 3-part blog series, “Cash-back Dividends.” Cook has turned to Carolina Farm Credit through the years for his farming operation which has included poultry and cattle, and now a business, Absolute Poultry. Streich and her husband have purchased land and started a small cow-calf operation.