Loan restructuring a drawn out business, the Rural Bank finds
About one-tenth of the farmers in Canterbury, Nelson, Marlborough and West Coast have applied for debt restructuring meetings through the Rural Bank, according to the regional appraiser of the bank in Christchurch, Mr Stewart Wright More than 959 applications have been received by the Christchurch office, which covers the South Island above the Rangitata River, and there are about 93H farms over 29 ha in that region.
So far about 259 arrangements to discount loans have been reached in farm finance meetings. The bank still has 599 applications in this region which are in process.
The Greymouth, Nelson and Blenheim dis-
trict offices of the bank are well through their lists of applicants but the Canterbury offices have large backlogs. The progress being made in processing over 7tH applications nationally varies from region to region, said Mr Wright, but in those areas where big backlogs exist some attempts have been made to speed progress by making preliminary assessments. The bank’s general manager, Mr Ray Chappell, has firmly emphasised that there has been no change in the restructuring or discounting policy but in the methods of dealing with applications. Those who may be declined a farm finance meeting include those who cannot meet the criteria for restructuring
or who have off-farm assets. / “Now we have a good feel for what concessions may or may not be available from the other lenders,” said Mr Wright. “Farmers may have had an expectation that everyone was at least entitled to a meeting under the discounting scheme and- that by putting in an applicaiton they were buying time.” The bank is also finding that quite a large proportion are declined restructuring .assistance because recent revisions of their budgets have put them into a surplus for the current financial year, perhaps because of better wool prices. The Rural Bank executive in charge of administering the loan restructuring scheme, Mr Graeme Lili, said from
Wellington this week that during April 13S people nationally were declined but two-thirds were ineligible for reasons Including a surplus budget. Only in 45 cases was It not possible to reach an understanding with other creditors.
Nationally the figures for the scheme are 8551 applications processed to the end of April with 17M approvals, 155 restructurings . by 'Mher means, usually extension of loan terms, 45 with-, drawn and 517 declined.
Mr Lili explained that farmers in hopeless positions were coming to realisations that they had to go and reaching agreements with their lenders on what they could take away. Consequently a number of farm sales were being made and this In turn
gave confMonce to wEwCatoilUHHT<. üßwJf « S 3 The bank is not isMriag property lew notices but It will take positive ae- ■ tien to sell an properties which bshre been abandoned, which have been “disclaimed” by the Official Assignee in the case of bankruptcy, or where the farmer obviously has a capacity to Ky but will aot perhaps cause Rural Bank credit is cheaper than a trading bank overdraft. “We are givlag people time to accept the realities,” said Mr Uli, “and we believe that this probably results in the same time period to an eventual sale as the protracted business of issuing PJLA. notices and forcing a sale.”
Permanent link to this item
https://paperspast.natlib.govt.nz/newspapers/CHP19870515.2.90.10
Bibliographic details
Press, 15 May 1987, Page 13
Word Count
547Loan restructuring a drawn out business, the Rural Bank finds Press, 15 May 1987, Page 13
Using This Item
Stuff Ltd is the copyright owner for the Press. You can reproduce in-copyright material from this newspaper for non-commercial use under a Creative Commons BY-NC-SA 3.0 New Zealand licence. This newspaper is not available for commercial use without the consent of Stuff Ltd. For advice on reproduction of out-of-copyright material from this newspaper, please refer to the Copyright guide.
Copyright in all Footrot Flats cartoons is owned by Diogenes Designs Ltd. The National Library has been granted permission to digitise these cartoons and make them available online as part of this digitised version of the Press. You can search, browse, and print Footrot Flats cartoons for research and personal study only. Permission must be obtained from Diogenes Designs Ltd for any other use.
Acknowledgements
This newspaper was digitised in partnership with Christchurch City Libraries.