Few realize that when Kent Bang, director of swine lending at Compeer Financial, ventured out into the pork industry as a young college graduate, his passion was not in ag finance. It was in swine genetics.
Bang started work on his master’s degree in genetics after completing his bachelor’s degree in animal science at the University of Nebraska. But after he got married and found a job in genetics, he moved on to new adventures and didn’t complete his master’s degree.
For the swine industry, that may have been a blessing in disguise. After managing genetic selection and sales for a couple of years, he was hired as a consultant for Purina Mills, and later Archer Daniels Midland. Eventually he was hired by Farm Credit in the 1990s as a swine specialist, during a time when the pork industry was growing rapidly. Pork producers needed help putting together a business plan, getting financing and executing on their plan.
“It was hard to find lenders interested in that kind of lending – and that’s how I ended up with Farm Credit, and now Compeer Financial,” Bang says. “I was always interested in the numbers, although I really had little education in that end of it. I had some accounting business classes and economic classes in college, but I found them extremely mundane. However, later in life, I figured out how helpful that background was.”
Today, Bang has been with the Farm Credit System for 20 years, and specifically with Compeer Financial for over 10 years, helping build a portfolio of successful swine clients. He shares his views on the industry, leadership strategy and what he’s learned during his career.
Q. What is your why?
A. The way we’ve approached swine lending is a little bit unique, maybe a lot unique, in that we look at the customer’s business number one. If we can help producers be successful, in the long term that’s very good for our business. I think we’ve encouraged our team internally to say, “How can we help producers?” Every day when we go to work, we want to figure out how our clients can be more successful in this industry. We work with a large base of very successful professional clients. Obviously, we can’t say that’s all our doing – it’s their doing. But hopefully, we’ve had a part in that success.
Q. Describe a typical day on the job for you.
A. Our first priority is to track and make sure that we’re staying on top of where our clients are at, understanding what challenges they face, and discovering tools and information we can bring to them to help them with those challenges. A lot of my day is spent in discussions to learn about what clients are dealing with and to uncover ways we can help, whether that be through risk management, production changes, or other things that are often considered outside of the finance or credit world. Why? Because this is a pretty complex business, and it takes all of this to be successful. I help producers find tools, utilize tools, and put the financing behind it to help them manage risk in the pork business and manage returns long term.
Q. What’s one thing you do in your job that people may not realize?
A. We get involved to a great degree in succession planning, helping people move their farm from one generation to the next. Succession planning is not just a tax issue, it’s not just a business change, it’s really about relationships with the next generation. I try to help bridge that gap for families.
Q. Why is industry engagement so important to you?
A. I spend a lot of time trying to stay engaged in the industry. Our company thinks it’s really important as well. For many lenders, lending alone is a full-time job. But we look at it a little differently. We think it’s that important to be engaged in the industry, either at the local, state or national level, providing help where we can and learning along the way. For me, two of the highlights of my career have been serving on the board of directors for the National Pork Producers Council and the U.S. Meat Export Federation.
Q. How does your company help and work with its customers?
A. It varies from client to client, but our goal is to really know the people within their leadership structure and have a relationship with them. Whether it’s the owner, CFO, CEO, production manager, or HR manager, we want to be able to provide some help and expertise for each member of their team or at least point them to helpful tools. To do that, you have to have both the relationship and the trust that you can help them find tools (and then you need to have the tools somewhere or know where to find them).
Q. How has the business changed since you started?
A. In 1997, when I started with Farm Credit Services of America, they were starting a swine specialist team. This was the first one I knew about anywhere in the country – at the time, there was no such thing. Over the years, it’s had to change as the producers change. It is so much more concentrated today, with larger farms, more integration and a lot of consolidation. When I started in swine lending, a 2,500-sow farm was huge. Now we have clients that have 100,000 sows or more. Because of this, it has changed dramatically in how we need to serve them. They’re more specialized and more focused, and from a lending standpoint, we have to be as well.
When I started, most of the swine loans were secured by land, which wouldn’t get people very far today. Now, it’s financing specialized assets down to truck washes and boar studs. The collateral package has changed, and the needs of the borrowers have changed. I’d say there’s always been volatility in this industry, but the volatility at these volumes simply have to be mitigated by the producers. That aspect has changed a great deal in this period of time since I started.
Q. What concerns do you have about the swine industry?
A. I made a list the other day of generalized concerns in the swine industry and it’s at 20 right now – ASF, tax change, labor, etc. The list goes on and on and it takes more expertise as a CEO to manage these pig companies than in the past. It’s clear the issues that the industry will have to address is just going to continue to grow. One of the issues that concerns me now is price discovery and how we go about doing that as an industry
Keep reading to learn about Bang’s business philosophy and what he would do differently in his career.
PORK Perspectives is a recurring column that provides business and leadership strategy tips from some of the pork industry’s finest. Opinions expressed in this column are the opinions of Kent Bang and do not represent the opinions of Farm Journal’s PORK. Watch for future columns featuring advice and insights from more of the pork industry’s leaders.
