RURAL CREDIT.

Auckland Star, Volume LXII, Issue 262, 5 November 1931, Page 20

RURAL CREDIT.

REPORT OF BOARD.

"POLICY WELL ESTABLISHED"

OPERATING SUCCESSFULLY.

"The board's policy is firmly established and is operating successfully," states the Rural Intermediate Credit Board in its report for the year ended June 30, and presented to Parliament. An outstanding feature of the year's operations has been the increasing popularity of the method of obtaining loans through the medium of the rural intermediate credit associations. The total business through associations, and by the discounting of promissory note 3, dealt with up to the end of the period, was £840,000, as against £590,200 at June 30, 1930, an increase of some £250,000.

"The year has been a difficult one, owing to the reduced prices received for primary produce and the t:nfavourabl2 season," adds the report. "It is all the more gratifying to record that the great majority of the board's borrowers have met their commitments in full." The attitude of the board had been that adequate security for its loans should bs insisted on, and the applicants should demonstrate to the satisfaction of the board that under reasonably favourable circumstances they would be able to make a success of farming and- to meet their outgoings. It was evident that no good purpose would be served by granting a loan to a farmer whose

finances were involved. It was pleasing to note that a primary object of the board, that a farmer should be supplied with progressive amounts of credit as his position improved, had been largely attained. "Farmers who have obtained loans from the board and who desire further advances for productive purposes, will have no difficulty in obtaining the requisite finance, provided their relations with the board have been satisfactory, their finances sound and the securities acceptable to the board." Concessions.

The board considered that preference should be given to applications for credit, in which substantial amounts would be applied to productive purposes. "It has been found necessary to grant concessions to some borrowers during

the year in respect of their principal repayments, and in a number of cases to postpone the payment of interest. Each case in which postponement was applied for was carefully reviewed, and if the mortgagee or lessor of the land was willing to co-operate, and a concession was justified in the interests of the farmer and for the preservation of the security, the board granted such relief as was warranted by the particular circumstances. The board has in suitable cases entered into arrangements with the borrower and his other mortgagees or encumbrancers for the financing' of the farm until the next ensuing season, and the equitable distribution of the farming proceeds among the various encumbrancers.

"It is pleasing to record that the number of cases where concessions have been required was comparatively small, and that the great majority of the board's borrowers have met their commitments in full."

Fertiliser Policy. The policy of the board was eased a little in the matter of loans for fertilisers. The sum of £100,000 made available by the Government, was entrusted to the board, with instructions that it was to be lent under somewhat easier conditions, and that any losses incurred should be borne by the Consolidated Fund. Loans not exceeding £75 were being made to individuals, provided that a guarantee of 50 per cent of that amount, satisfactory to the board, was obtained. Where such a guarantee was not possible, the board was prepared to make the advance provided a satisfactory charge was given over the milk cheque or other proceeds.