The Bankers’ Association highlighted in its submission: “continual discussions and negotiations between lenders and with their farming customers is the norm in a banking relationship and in the event there is a dispute that warrants having a formal process with an independent “circuit breaker” involved, members would actively encourage mediation (regardless of the statutory scheme)”.
New Zealand Bankers’ Association chief executive Roger Beaumont confirmed that banks might shorten mortgage for properties that are at risk. He also raised the issue of insurance, saying without insurance banks won’t approve a home loan.
Primary Production Committee
“It’s a good idea to calculate the potential interest rate savings for the balance of the fixed period against the break cost.
Then you can make a carefully considered decision and not just chase a cheaper rate.
Your bank should be able to help with this comparison.”
Bankers’ Association chief executive Roger Beaumont said it was up to each bank as to how it responded if the rules come into effect.
“Our independent economic analysis suggests there will likely be tightening of lending in some parts of the economy such as small business and agriculture.”
New Zealand Bankers’ Association chief executive Roger Beaumont said banks had different organisational structures to deal with hardship and loan repayment issues.
Financial Markets Authority
“Conservative lending practices, which drive consumers to higher-cost and potentially irresponsible lending, run counter to the important policy objectives of promoting financial inclusion and access to safer credit.”
Organisations that carry out business in New Zealand are required to report inactive accounts under the Unclaimed Money Act 1971.
Finance and Expenditure Committee