LONG TERM LOANS.

Hawera Star, Volume XLVI, 2 July 1926, Page 5

LONG TERM LOANS.

DISCUSSED BY DAIRY FARMERS

BANK’S SCHEME UNDER FIRE. (BY TELEGRAPH PBEBB ASSOCIATION > PALMERSTON' N., July 1. The Bank of New Zealand’s scheipe of long-dated loans for farmers was under lire at the annual conference of the Daily Farmers’ Union to-day, when discussing the following remit from the Apiti branch: “That- representations he made to the Government that the legislation required by the bank be held 1 over until after the report of the Agricultural Bank Commission is received.” The president (Mr N. Campbell) also referred to the same matter in his presidential address, stating that one of the greatest- needs oif the farmer t'o-day was a. change from, the present mortgage system to long-term loans, repayable on the amortisation principle. He presumed the Agricultural Bank Commission would return at an early date, and farmers were anxious, to know what their recommendations would! be. In the meantime all had been surprised by the announcement of the chairman of the Bank of New Zealand that the bank proposed; to create a special department for making long-term loans to fanners, the same as an 'agricultural bank would do. Although this was highly commendable, the- scheme was regarded with .suspicion by many producers, coming as it did at this particular time. In fact, it was hinted that with such a department in operation there would be no need for an agricultural bank. This, to his mind, was entirely wrong, as the amount to l>e raised was far too small to bo of any material benefit to farmers. It was proposed to raise this additional capital at 7% per cent and lend it at 0 per cent, thereby losing If per cent. Although certain benefits might come to the bank by the way op increased business, it was not likelv that the Bank of New Zealand would lend money at a loss-. Mr Campbell thought the Dairy Fanners’ Union should assist tbe Fanners’ Union to establish an ■ agricultural bank.

Mr AV. 1. Pratt (Apiti) was afraid the bank’s scheme was the death blow to an agricultural bank.

Mr AV. G. Short (Feilding) considered the scheme was .also the thin edge the wedge for the elimination 1 of the State Advances Denartment.