Farm Credit Canada (FCC), one of Ottawa's largest financial institutions, manages a loan portfolio approaching $60 billion and has generated roughly $5.6 billion in cumulative net income over the past decade. Yet outside agricultural circles, it remains virtually invisible. Dr. Sylvain Charlebois, director of the Agri-Food Analytics Lab at Dalhousie University, argues that FCC needs a new mission and more transparency.
Changing financial landscape raises questions about FCC's purpose
When FCC was created nearly 70 years ago, agriculture was considered too risky for conventional lenders. That world has changed dramatically. Every major chartered bank now has sophisticated agricultural lending teams, credit unions have expanded aggressively into farm finance, and private lenders have become increasingly active. Canadian agriculture is certainly not without financial challenges, but access to capital is no longer the structural problem it once was.
Charlebois asks: is FCC still correcting a market failure, or is it increasingly competing in a market that now functions well on its own?
FCC is bigger but not necessarily better
FCC remains a successful organization, with its loan portfolio expanding to nearly $60 billion. However, higher interest rates have significantly increased FCC's own borrowing costs, lending margins have narrowed, and provisions for expected credit losses have risen as farm finances become more strained. While lending activity continues to grow, profitability has weakened considerably compared with only a few years ago. FCC is becoming larger, but not necessarily stronger.
CEO expenses spark governance concerns
This changing financial landscape makes governance more important than ever. According to records obtained under the Access to Information Act and reported by Blacklock's Reporter, FCC president and CEO Justine Hendricks claimed approximately $182,000 in travel and hospitality expenses in one recent year, nearly four times the amount reported by her predecessor in his final year as CEO. The reported expenses included business-class international travel, a more than $500 Uber ride between Edmonton and Calgary, and filet mignon dinners.
Ironically, internal communications reported by Blacklock's also indicate that Hendricks urged employees to "tighten the belt" and exercise greater discipline over spending. Charlebois notes that public expectations are understandably higher for the leadership of a taxpayer-backed Crown corporation.
FCC's influence extends beyond lending
The broader issue extends beyond executive expenses. FCC has become one of the largest sponsors of agricultural conferences, trade shows, podcasts and industry organizations in Canada. While its financial support has benefited the sector, Charlebois warns that when one institution becomes one of the industry's largest financial supporters, its influence extends beyond lending. Event organizers naturally become mindful of sponsor expectations, and controversial viewpoints can receive less attention. Agriculture thrives on innovation, and innovation requires vigorous debate. A publicly owned institution should strengthen that marketplace of ideas, not unintentionally narrow it.
Focus on areas where financing gaps remain
Charlebois does not suggest FCC should disappear. Canada still benefits from having a specialized agricultural lender, particularly for beginning farmers, succession planning, Indigenous agriculture and innovative businesses that private lenders may be reluctant to finance. However, rather than competing broadly with chartered banks for borrowers who already have ample access to capital, FCC could concentrate more deliberately on areas where genuine financing gaps remain. That would better reflect its original public policy purpose while reducing the extent to which taxpayers compete with private lenders.
FCC has become an impressive financial institution. The question is no longer whether it has been successful. The question is whether its success is now measured by the size of its loan portfolio rather than by the public value it creates. Crown corporations are not meant to compete simply because they can. They exist to solve problems the market cannot.
