Federal land banks are facing heavy 1985 losses.

Depressed farm income and declining farmland values are likely to create substantial deficits at the nation’s 12 federal land banks this year, according to the president of the Federal Farm Credit Banks Funding Corp. A special credit review, now in progress, is aimed at projecting the amount of losses that those banks will sustain in the second half, Peter J. Carney said. He said that the recently announced bail-out of the Omaha-based credit bank would result in a third-quarter loss and predicted that problems throughout the system would cause red ink for the full year.