THE MORATORIUM

Southland Times, Issue 19291, 9 July 1924, Page 5

THE MORATORIUM

LOCAL EFFECT OF EXPIRY NO CAUSE FOR ALARM SOUTHLAND THOROUGHLY SOUND. What will happen in Southland when the Moratorium is lifted? This question, put yesterday to prominent business men and heads of lending institutions in Invercargill by a representative of the Southland Times, elicited an almost unanimous reply that so far as Southland farmers arc concerned, there is no cause for any anxiety. There certainly is, in Southland, a percentage of farmers who are financially unsound, and who have been, and still are sheltering behind the Moratorium, but the percentage is small, and whether the Moratorium is lifted or not, there must come a time when these few will go under. As to the possibility cf the mortgagee* calling up their invested moneys after December, a local business man remarked:— “It would be folly for-commercial firms to attempt to call up their mortgages on farmers’ properties as very few farmers are in a position to pay off the pincipal, and it wquld simply mean that the farms would have to be taken over by the mortgagees. As there is no sale for farms at the pre sent time the mortgagees would be left with the farms on their hands, untenanted, and therefore rapidly deteriorating in value.” Continued Moratorium protection, said another gentleman, means that all charges have been met with on due date, and if farmers have been able to pay the interest on mortgages all the years it has been in existence, there is no reason why the lifting of the Moratorium should be followed by wholesale bankruptcy. “The lending institutions,” said another well-known business man, ‘ have great faith in Southland. They arc not, except in the case of a morally bad risk, going to take advantage of the lifting of the Moratorium by instantly calling up all invested moneys -such a course would be a boomerang which would inevitably turn and knock the bottom out of the business community.” Bank managers also gave it as their opinion that nothing drastic was likely to occur—for the last two years mortgages held by banks on land did not come under the Moratorium and so far as the banks were concerned, it therefore made no difference to fanners whether the Moratorium was in existence or not.