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First National Bank of Oklahoma is proud to announce the successful closing of a $12,320,000 USDA Timber Production and Expansion Program (TPEP) guaranteed loan to support the purchase of two shuttered timber mills located in Pushmataha County, Oklahoma and Amite County, Mississippi.
This landmark transaction represents the first USDA TPEP loan ever financed in either Oklahoma or Mississippi and underscores FNBOK’s commitment to innovative rural development lending across multiple states.
Financing the Comeback of Two Timber Mills
The borrower — an experienced operator in the U.S. timber industry — acquired the mill assets from a Canadian bankruptcy court at a significantly reduced cost, resetting the capital structure and creating room for long-term viability.
With the USDA guarantee in place, FNBOK provided acquisition financing on a 17-year term, including two years of interest-only payments, followed by a 15-year amortization — terms well-aligned with the cyclical nature of timber operations and capital reinvestment schedules.
A Multi-Phase Turnaround Strategy
The borrower’s business plan includes:
- Reopening the mills after nearly 12 months of dormancy
- Rehiring legacy workers, preserving regional industry knowledge
- Retooling operations to align output with the local “woodbasket”
- Shifting production focus from specialty lumber to more readily available, cash-flowing production wood
This strategy is rooted in operational discipline and local sourcing efficiency. The prior owner had focused on high-margin specialty lumber that required costly, long-haul log procurement from distant regions. These extended supply chains strained profitability due to elevated trucking and raw material costs.
By contrast, the new operator will match mill production with the local woodbasket, capitalizing on readily available, lower-cost logs that can be delivered efficiently — even if margins are lower, the reset acquisition basis allows the business to achieve positive cash flow and long-term sustainability.
Economic Impact in Oklahoma and Mississippi
Once both facilities are brought back online, the mills are expected to create and support over 100 full-time jobs in two deeply rural counties. These jobs will span sawmill operations, trucking, maintenance, administration, and supply chain services — helping restore critical employment and economic stability in communities affected by the mills’ prior closure.
“We’re proud to be the first bank to bring USDA TPEP financing to Oklahoma and Mississippi,” said the USDA Lending Team at First National Bank of Oklahoma. “This deal is about more than just mills — it’s about restoring jobs, revitalizing local supply chains, and bringing smart, long-term investment into rural America.”
About USDA’s Timber Production & Expansion Program (TPEP)
Created in response to increasing demand for domestic timber production and mill capacity, the USDA’s TPEP program provides loan guarantees for private capital investment in timber processing and infrastructure. Key use cases include:
- Sawmill construction or acquisition
- Equipment modernization
- Value-added wood product development
- Sustainable forest-based supply chain enhancements
As a USDA-approved lender, FNBOK is positioned to guide borrowers through the application and approval process, aligning capital solutions with federal incentives and long-term business goals
Why Work with FNBOK?
With deep experience in USDA B&I, REAP, and now TPEP lending, First National Bank of Oklahoma brings a unique combination of:
- Multi-state rural lending expertise
- Customized loan structures for specialty assets
- Relationships with USDA offices and regional authorities
- Hands-on service from underwriting through closing
If your project involves timber, agriculture, infrastructure, or rural manufacturing, FNBOK has the experience and government lending know-how to make it happen.