Simmons Bank has expanded beyond the state’s borders into five states, each of which share with Arkansas a rich agricultural heritage.
The Pine Bluff-based bank recently announced the creation of a new agricultural division and hired Cole Plafcan, Razorback football letterman and former senior vice president at AgHeritage Farm Credit Services, to lead it as SVP and director of agricultural lending.
AMP visited with Plafcan about his new role and the challenges facing the industry.
AMP: What led to the bank’s decision to create this new division?
Plafcan: Agricultural lending is in our DNA at Simmons Bank. The decision to create this new division speaks to our continued commitment to the agriculture community. As the bank continues to grow within its six-state footprint, we want agricultural lending to continue to be part of the bank’s overall growth strategy.
AMP: As a top-35 agriculture lender, what percentage of the bank’s business does agriculture represent?
Plafcan: According to FDIC data as of Sept. 30, 2021, Simmons Bank ranked as the 32nd largest farm lender based on dollar volume. This includes production lines of credit to equipment loans as well as real estate lending. Recently published data, as of Dec. 31, 2021, shows Simmons Bank ranked 37th with $521 million in farm loans, or approximately 4.3 percent of total loans.
AMP: Given the bank’s now six-state, ag-heavy footprint, what’s the potential for this new division?
Plafcan: Simmons Bank has a rich tradition in agricultural lending with our roots being in Pine Bluff and southeast Arkansas. With our expanded footprint in the surrounding states — Texas, Tennessee, Missouri, Oklahoma and Kansas — there are vast agricultural areas for tremendous future growth at Simmons Bank. I look forward to the opportunity to work with our associates in these areas to expand our ag presence.
AMP: What are some issues facing the agriculture industry right now — such as inflation and the rising costs of fertilizer, fuel, etc.— that could impact what you do?
Plafcan: There are a multitude of issues facing American agriculture today. It’s been well documented in the media about the current inflationary issues with fuel and fertilizer. Overall, production expenses are estimated to increase 30 percent from a year ago, which will compress margins. There are other concerns such as supply chain issues with equipment and especially parts. Combined with the wet spring, which has delayed planting in many areas, it will make the year even more challenging for producers. Understanding that agricultural lending is a cyclical business and being able to weather those storms with your customers is key.
AMP: How are lenders impacted by the growth of technology in the industry?
Plafcan: Technology is certainly changing the face of agriculture. Farmers and ranchers are continually looking for solutions to become more efficient in their operations. The use of various mobile apps and the introduction of the autonomous tractor are just a few of the ways technology is impacting ag. Lenders are also impacted, not only with the way they are interacting with their customers, but also with several competitors that have shown up in the marketplace. With the customer experience being at the forefront for many organizations, lenders are impacted with new technologies and systems at an increasing rate, which will only continue into the future.
AMP: How did your role at AgHeritage prepare you for this new position?
Plafcan: Throughout my previous career, first as a direct lender, and then most recently in senior management, the various experiences I had over the course of 25 years have given me good perspective for my new role. Understanding the customer expectations as well as those of the lending and support staff will enable me to maneuver effectively going forward.
(Editor’s note: The views expressed here are those of Cole Plafcan individually, and do not reflect those of Simmons Bank.)