AGRICULTURAL BANK

Hokitika Guardian, 22 May 1926, Page 2

AGRICULTURAL BANK

AVORK OF COMMISSION. REPORT EXPECTED NEXT MONTH. AYELLINGTOX, Alay 19. Something of a decidedly concrete character as to the practicability or otherwise of the establishment of farmers’ banks in New Zealand should ho available at an early date as the commission appointed to inquire into the working of oversea methods is expected to return to New Zealand next month. The Commission, which comprised Colonel J. J. Esson, Financial Adviser to the Government (chairman) ai d Messrs P. H. Cox and AY. J. Polse-.^

w;Js empowered by the Government’ to investigate the working of agricul-. turn! banks and rural credits abroad, the scope of the inquiry including investigating into the methods of fmnacial assistance afforded to farmers in the countries and States of Europe, Egypt and America. The Prime Minister was questioned on tho subject to-day, and his reply was that the commissioners expected to return to the Dominion some time next month. The report of their investigations would be submitted to the Government.

In his manifesto published at the beginning of October last Air Coates indicated that the Government desired tlf.it whatever scheme was undertaken it could he of a character that would readily assist the primary producer and be a financial success. The regulations appointing tho commission stipulated tllf.it the report is to be in hand not later than the end of next month.

•SCOPE OF INQUIRY. The Commission was empowered to inquire into the following matters: — (1) The financial assistance afforded to farmers in countries and States of Europe, Egypt land America by means of land mortgage bonds or through land credit association, or in ai.y other matter whatever.

(2) The legislation in force and the methods adopted by the Governments of such countries and States to lft’ord. such financial assistance as aforesaid. (3) Tho means by which such financial assistance is afforded to farmers, and in particular (a) the nature of the security given by farmers, tiie periods for which loans are advanced, the rates of interest payable and the provisions for amortisation of debt, (b) the provision for realisation of securities in oases of default, (c) tho margin of security required, its sufficiency or otherwise, and the moans'adopted for valuing the security, (d) the restriction or otherwise of loans to defined and limited purposes, such as improvements to farms, additions or purchases of stock and tl e means by which'any such restrictions (ire enforced, (e) the extent to which members of any group of borrowers are liable for the default of any one of them.

(4) The means by which moneys are raised for the purpose of affording such financial assistance, and in particular (a) the nature of the security upon which .such moneys are raised, Hie periods for which such moneys are raised, the rates of interest payable, and the provisions made for repayment of capital, (b) The denomination of bonds and other instruments of security and the means of transfer and realisation thereof, (c) The extent to which such securities or the in- > stitutions issuing the same are subject to Government supervision, (d) The extent to which support is granted by the said countries and States to such securities or the institutions issuing the same by way of guarantee or provision of capital or exemption from taxation or otherwise.

(5) The working results and the comparative advantages of the various methods of affording such financial assistance as aforesaid, and in particular (a) the extent to which the assistance afforded is made use of. (b) Tho extent to which losses occur and the incidence of such losses, (c) The market value of securities upon which moneys for the purposes aforesaid are raised and the fluctuations (if any) in such value, (d) The relative success of the issue of securities by co-operative groups of farmers or landowners , :td be independent financial institutions, and whether it. is essential or. desirable that all persons borrowing should he shareholders of such institutions, (e) How far it is advisable that members of any yroup of borrowers should bo made lthble for tlie default of any one of them.

(G) T lie advisability of the adoption in the Dominion of New Zealand of one or more of such methods -as aforesaid and the modifications therein (if any) which the conditions of the Dominion require or experience shows to be desirable.

(7) Generally any matters that may appear to he relevant to or connected with the matters included in the scope of this inquiry, or of importance in considering the adoption in New Zealand of any such method of affording financial assistance to farmers.