AGRICULTURAL BANK

Waikato Independent, Volume XXIII, Issue 3071, 16 June 1923, Page 3

AGRICULTURAL BANK

NOT THOUGHT NECESSARY BANK OF NEW ZEALAND’S POSITION (Special to Waikato Independent). WELLINGTON, June 15. At the annual meeting of trie Bank of New Zealand, held at Wellington today, the following interesting reference to the proposed Agricultural banking system was made by the Chairman in his address: — In October of last year aw Act was passed by the late Parliament authorising the formation of “Rural Credit Associations,” with the idea of enabling farmers to combine for the purpose of receiving deposits and borrowing other moneys, and then lending to the members of the Associations the funds thus obtained.

I believe that, so far, no Associations have been formed under this Act, and it is understood that a Bill is shortly to be introduced into Parliament to provide for the establishment of an Agricultural Bank on wider lines than those of the Rural Credit Associations authorised last year. I can only repeat what I said last June, that I see no objection to the measure, provided such banks rely on their own resources as other banks do, and that, they are subject to taxation. Nevertheless, the fact that the activities of the Advances to Settlors Department have recently been extended, renders quite unnecessary, in my opinion, the establishment of an Agricultural Bank. When the borrowers’ needs cannot be met by the Government Departments, the Joint Stock Banks, or- ' dinary lenders, the various proprietary concerns whose business it is to lend on farm land and live stock, and the various co-operative finance organisations owned and controlled by farmers, the borrowers must be in a bad wav' indeed. It is safe to say of the majority of those farmers who are in difficulties, that they have luid too much credit, not too little. The extent to which this bank assists the pastoral and agricultural industries will be realised when I tell you that, over ID millions of our advances in the Dominion at 3.lst March last were to customers engaged in .those industries. The small borrower has also been well entered for since in point of number, 50 per cent, of our advances were foi’ amounts of £3OO or under; quite a large proportion indeed were under £IOO each, and many of these (usually advances of a temporary nature) without

any security. The authorities of the hunk are quite alive to the importance of supporting the pastoral arid agricultural industries, and that our support has been more than generous is borne out by the fact that, during the last few years, practically the whole of our bad debts—and they have not been insignificant —have been incurred on such advances. Much criticism of the methods in which the banks conduct their business has emanated from those engaged in rural pursuits. May I be pardoned for reminding those critics that the results of the working of their own organisations have nor been such as to convince thinking people that they arc qualified to handle that most serious business of all —finance'; a business, which, perhaps more than any- other, calls for an amount of judgment and care that only those who have had long experience and sound training are able to give to it.