8.—14.

This method of obtaining loans has also been well supported by dairy companies, which have appreciated its advantages for the making of small loans for short periods with a minimum of expense. 41. Business transacted. —The discounts effected during the year totalled £4,839, as compared with £5,625 for the year ended 30th June, 1933. The total value of bills and notes outstanding at the 30th June, 1934, was £2,310, as compared with £5,300 at the 30th June, 1933. LOANS FOE PURCHASE OF FERTILIZER—SPECIAL FUND. 42. Of the £11,891 lent by the Board under the special arrangement with the Government for the financial years ended on the 31st March, 193] and 1932, only £141 2s. 3d. was owing at the 30th June, 1934, while £25 4s. has been written off as irrecoverable. Probably further amounts will yet be collected, but even if no further payments are received the maximum loss will be £166 6s. 3d., funds to meet which have been provided by the Treasury. When it is recalled that the loans were made wholly on personal security, the result achieved is very creditable. DAIRY COMPANIES. 43. Valuable support has been accorded to the system by dairy companies under the three methods of making loans available to farmers. The main support has come in respect of Part 111 of the Act, whereunder loans may be made direct to farmers supported by guarantees of not less than 20 per cent., but many companies have made their endorsements of promissory notes available to enable dairy-farmers to obtain loans under the discounting system, which is so eminently suitable for the provision of small loans for short periods. Companies have also actively promoted the formation of some associations, through which their suppliers are able to obtain loans without it being necessary for the companies to provide guarantees. There is a wide scope for the further development of the system in this direction, and companies which are interested would be well advised to obtain further details. It is evident that those companies which have utilized the system recognize the advantages offered, and their assistance is appreciated by the Board and by borrowers, who have been able in this way to obtain finance on the reasonable terms approved by the Board. SCHEMES IN OTHER COUNTRIES AND INQUIRIES FROM ABROAD. 44. The Board has kept closely in touch with the development and working of rural credit systems in other countries with the object of introducing to New Zealand any details which prove satisfactory in other countries and which appear suitable for adoption under the rural intermediate credit system. During the year reports from Tasmania, Kenya, New South Wales, Canada, Queensland, and the United States of America were perused with this object in view. Numerous communications are received from overseas inquiring for particulars of the rural intermediate credit scheme and its introduction and development. Information was supplied during the year to inquirers from Victoria and Holland. FINANCE AND ACCOUNTS. 45. Accounts to 30th June, 1934.—The accounts reveal a decrease in the gross income from £29,665 for the year ended 30th June, 1933, to £22,854. This figure, however, does not include the sum of £7,058 4s. Id., the income earned by investments of the Rural Intermediate Credit Redemption Fund, credited direct to the Redemption Fund Account. The decrease in income is attributable to various factors, including — (a) The reduction of \ per cent, in the Board's lending-rate from the Ist May, 1933 : (b) The receipt of lower rates of interest on the Board's temporary investments: (c) The decrease of £79,938 to £274,080 in the investments in the course of the Board's ordinary business : (d) The large amount held continuously in temporary investments at low rates of interest.

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