RURAL CREDIT

Evening Post, Volume CXX, Issue 112, 7 November 1935, Page 11

RURAL CREDIT

LOSSES IN WAIRARAPA

ASSOCIATION'S TROUBLES

(Special to the "Evening Post.")

MASTERTON, This Day.

Special interest attached to the annual meeting of the Wairarap'a Rural Intermediate' Credits Association, held in the Farmers' Rooms yesterday, on account of the difficulties into which the association has been thrown by sustaining losses upwards of £1000. The association is making no further loans and the manner in which its losses are to be met has yet to be determined.

Mr. K. Groves,, chairman of directors, said that when the losses 'became apparent, the directors asked the Central Board for advice as to how the losses were to be met. The reply was not advice but an instruction to call up the 19s per share outstanding, failing which the Central Board would apply for a Supreme Court injunction. Knowing the position of their borrowers and of quite a number of shareholders as well, the directors were not prepared to make this call.

Mr. Groves then told of the directors calling a meeting of shareholders and later going. as a deputation to Wellington to interview the Central Board and the Minister of Finance They got sympathy, he observed but very little else. Mr. Coates told .them, that under existing legislation he had no power to give the association any assistance until it had exhausted its resources, which meant calling up the 19s per share. This being done, the Central Board would automatically take up the balance of the loss. Although the Central Board had instructed them in August last to call up the 19 S a share, under threat of enforced liquidation, nothing had been done in this direction. He now gathered that no such action would be taken until after the election. After the deputation to the Central Board the results of which were nil three of his fellow-directors had resigned Vacancies on the directorate resulting from the retirement of Messrs. P S. McDonald and K. Groves were filled by the election of Messrs. H. P Brassel and A. E. Carter.