Mark Hooper: Federated Farmers Banking Spokesperson on agricultural lending falling by $1.4 billion and increased satisfaction with banks

This autumn's been positive for farmers, with less debt and an improved relationship with banks.  

Agricultural lending dropped $1.4 billion to $61.2 billion in the year to April. 

A Federated Farmers survey also reveals record satisfaction with bank communication, with fewer farmers feeling undue pressure.  

Banking Spokesperson Mark Hooper told Ryan Bridge that banks are currently competing quite strongly for a share of the rural market, which in turn drives good service.  

He says a good relationship tends to override a lot of other outcomes – there may be variations in interest rates, but if they have good communication and a good relationship, people tend to be more satisfied.  

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Episode Transcript

Speaker 1 (00:00):
Banks has farmer lending dropped nearly one and a half
billion in the year to April. Here back home Fonterra
and their lack delis payout plus strong returns for red
meat for dairy while they're paying down debt. Number of
farmers with mortgages under two million forty one percent. Six
months ago it was thirty eight percent. Mark Hooper, Fed
Farmers Banking spokesperson, Hey.

Speaker 2 (00:20):
Mark, good morning.

Speaker 1 (00:22):
It's interesting to see the change in the attitudes of
farmers to their banks.

Speaker 2 (00:29):
Yeah, yeah, well, I mean overall, it's it's a positive trend.
At present. What we're seeing is a sixty nine percent
satisfaction rate, which is the highest that we've seen since
twenty eighteen. And at the other end of the spectrum,
those farmers that are feeling under undue pressure from their
banks down to ten percent, which is also the lowest

(00:51):
since twenty eighteen. So a good kind of growing, strong relationship.
I think happening there.

Speaker 1 (00:59):
Is that the function of farmers are doing well, so
banks are less concerned or do you think there's a
genuine improvement and how they're getting on.

Speaker 2 (01:10):
Well, it's it's it's no doubt, a little bit of
both certainly, good times you know, make for good friends,
don't they. But what what we're actually seeing happen, and
it's probably a reflection of what you were reporting on
there with international banks, is that the New Zealand banks

(01:30):
are currently competing quite strongly for a share of that
rural market debt and so that, in turn, I think
does drive good service. And that's probably one of the
key messages that came out of the service survey as well.
Is it it's the relationship that the person has with
the bank which tends to override a lot of the
other outcomes. There might be variations and interest rates and things,

(01:54):
but if they've got good communication, a good relationship with
their agrid manager, they tend to be more satisfied. Yeah.

Speaker 1 (01:59):
I thought that was the most interesting thing to come
out of well. I mean, obviously the drop and borrowing,
but the most interesting thing was they care more about
the relationship, having someone decent who comes to the farm
and talks to them and they know over an interest rate.

Speaker 2 (02:20):
Yeah, yeah, that's right. But I think that internet relationship
does tend to drive some of those some of those
interest rate outcomes as well. I guess the concerning area
here is that we've got a couple of things. One
is that there is still quite a bit of variability
within that. We do still get reporting come through of

(02:41):
people having poor relationships and feeling under pressure from their banks,
and that's a reflection often of that breakdown of relationship.
But also it'll be interesting to see because we're not
having fair weather times with arable farmers at this stage.
They are the punch quite a bit more than others

(03:02):
for a variety of reasons, and I guess how well
the bank manages those relationships will be a reflection of
the overall attitude.

Speaker 1 (03:11):
Good point, Mark Cooper, Food Farmer's Nice Tavy on the show.
As always.

Speaker 2 (03:15):
For more from Early Edition with Ryan Bridge, listen live
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