FARMERS' TROUBLES

Taranaki Daily News, 9 February 1928, Page 15

FARMERS' TROUBLES

REMAINING ON THE LAND WAITING TURN OF TIDE Wellington, Feb. 2. "Early in 1927 and throughout the past year one mortgagor after another informed the board that owing to low prices of produce, adverse climatic conditions and other causes, he could no longer carry on. Most of these mortgagors expressed a desire to walk off the land and abandon everything in favour of the mortgagee. By making substantial concessions in principal and interest we have persuaded nearly all of our debtors to remain on the land in the hope that the tide would turn in their favour sooner or later.” This statement was made by Sir Harold Beauchamp, chairman of directors of the Equitable Building and Investment Company, Limited, at a meeting of shareholders of that institution to-day. “I have to deal with a matter which has occasioned your directors the gravest concern during the past 12 months,” he said. “I refer to the unfortunate position this and so many other lending institutions in the Dominion find themselves in with regard to mortgage advances on broad acres. In pre-war days there was no security held in such high esteem as farm lands, against which, valued for mortgage purposes by men who were considered as highly competent valuers, borrowers had n difficulty whatever in obtaining advances to the extent of 5(1 per cent, to 60 per cent, of such valuation. When I addressed you last year neither my colleagues nor myself had any reason to think that we would have to face heavy losses h respect to any such advances, all of which had been on our books for many years. In fact, up until Pee. 31, 1926, the interest on the majority thereof had been paid with commendable regularity and punctuality. "The prompt payment of interest in the past naturally lulled us into a sense of false security and other lenders were in similar circumstances. In the meantime the board has considered it prudent to transfer to the contingent securities depreciation account from the general reserve fund the sum of £20,000 to meet any losses that may occur on the ultimate realisation of mortgages that may come under the category of ’B and doubtful.’ I apprehend there will be no difficulty in paying tl a same dividend in future as that which we are recommending to-day, namely 10 per eent. per annum. I would add that we have since discontinued making advances to farmers, and are now confining our operations to loans on properties in Wellington And suburbs.”