‘Horticulturists threatened’

Press, 13 June 1984, Page 37

‘Horticulturists threatened’

PA Wellington New Rural bank security ratios could force some horticulturists to sell their properties, says the acting chairman of the Fruitgrowers’ Federation. Mr Alan Hyde. Other growers could face having to borrow at high rates of interest. Mr Hyde said. Before the change, the Rural bank allowed total lending on properties to be as high as two-thirds of the property's value.

The new ratios meant a mortgage postponed only if the total borrowings did not exceed half the property value. This meant growers might not be able to make further injections of working capital by borrowing from trading banks, Mr Hyde said. Some could be forced either to borrow at high rates or sell up. With the lending market already restricted, growers could experience further hardship from a shortage of |

funds. Mr Hyde said that the Rural bank had assured the federation it was always prepared to consider invididual cases and make exceptions to the rule. The change resulted from concern over falling rural land values. It was hoped the earlier policy would be reinstated as prices stabilised, he said. The federation would continue to press for a more liberal rule.