How are banks assisting clients facing dairy crisis? ANZ, NAB, Commbank, Rabobank, Westpac respond

Australia's major banks have recognised the impact of dairy crisis on clients, announcing short-term relief measures for farmers.
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The ANZ led the announcements today with its «dairy relief package», but concedes it would be offered to all farming clients «at any given point».
The response follows pressure from the state and federal politicians to support the industry, following destructive cuts to the farm gate price of milk paid by Murray Goulburn and Fonterra.
From today, ANZ’s dairy clients can apply for a three-month suspension of loan repayments, waived loan restructuring fees, adjustments to lending limits on credit cards and early access to term deposits.
Agribusiness manager Mark Bennett said every dairy farmer was eligible, but conceded a struggling grain producer would be afforded exactly the same treatment.
«It’s the kind of things that we would be flexible on our farmers with, at any given point,» he said.
«We don’t want to risk people missing out on that because they haven’t been in touch.»
Mr Bennett also confirmed that interest on loans would continue to accrue over the three-month suspension period.
«Absolutely that [interest] will be something they’re still responsible for,» he said.
«[Our customers] are typically not asking for debt forgiveness or escaping what would be their normal obligation.
«They’re really looking for, ‘how can I keep things running, how can I keep bills paid, how can I think confidently about the future and take some of the pressure out of the here and now?'»
ANZ would not, however, commit to a request from Victorian Agriculture Minister Jaala Pulford, to suspend all foreclosures on dairy farmers, until an ASIC investigation is complete.
«I think it’s just too early to contemplate that,» Mr Bennett said.

Westpac, NAB, Commbank, Rabobank work on ‘case-by-case’ basis

Westpac said it would not foreclose on any dairy farmers «over the next few months».
«For us it’s very much about looking at the long-term sustainability piece of their business,» general manager of agribusiness for Victoria and Tasmania Roddy Brown said.
Mr Brown said Westpac would not match ANZ’s relief package, but stressed his bank was working with dairy farmers on a case-by-case basis.
«We don’t want to take a blanket approach,» he said.
«We’re in it for the sustainable long-term needs of our customers, so we’re being careful not to have a knee-jerk reaction.»
National Australia Bank, Commonwealth Bank and Rabobank repeated assurances they too were discussing the situation with clients.
«We are taking a case by case approach to this issue and providing support around short term working capital requirements where required,» an NAB spokesman said.
«We must continue to support not only at a farm level but also downstream to small businesses that support the dairy industry.»
Rabobank said it was planning to issue a statement early next week in relation to support already being provided to dairy farming clients.
Commonwealth Bank said it was offering a extensions of loan agreements, repayment holidays and waived charges for fixed term deposit withdrawals before maturity.

Big banks highly exposed to commodity sector

Over supplied dairy markets have seen international dairy prices dropping since 2013, but Murray Goulburn only bowed to the pressure a month ago, cutting its farm gate price for milk from $6 a kilogram of milk solids to between $4.75 and $5 kgMS.
On Wednesday, Minister for Agriculture Barnaby Joyce indicated he would extend concessional loans to cash-strapped dairy farmers. But he later released a statement, saying that because the government was in caretaker mode it could be difficult to act until after the federal election.
Mr Joyce and his Labor counterpart Joel Fitzgibbon will discuss the matter within days.
The South Australian government has also offered an assistance package to dairy farmers, and it’s Victorian counterpart has pleaded with banks to ease the financial burden on it’s dairy producers.
Disclosures of half yearly results by the big four banks revealed many were highly exposed to the commodity sector, with analysts raising concerns about the impact on the banks’ earnings.
In New Zealand, where dairy farmers have been grappling with lower farm gate prices for several seasons, ANZ showed the probability of dairy farmers defaulting on loans has been rising since September 2014.
ANZ’s general manager of regional business banking Christine Linden said the bank had recognised the stress on its Australian customers, but remained confident in the industry’s medium and long term growth prospects.
 
Source: ABC
 

Mirá También

Así lo expresó Domingo Possetto, secretario de la seccional Rafaela, quien además, afirmó que a los productores «habitualmente los ignoran los gobiernos». Además, reconoció la labor de los empresarios de las firmas locales y aseguró que están «esperanzados» con la negociación entre SanCor y Adecoagro.

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