Banks feeling the jitters from the Global Financial crisis are foreclosing on indebted Australian farmers.
Just last Tuesday I was only saying to a good mate of mine, Neville Gear:
“Now you watch, with the global financial crisis and falling property values the major banks will start calling in their farm debts.
Whilst farmers have and probably still are servicing their interest only loans, with the banks nervous they will change the rules, take to revaluing properties and use new debt to equity ratio’s to call in loans.”
Well I didn’t have to wait for long for that to be proven correct:
The Australian Financial Review (sorry no link, subscribers only) today reported that forced farm sales are happening right across Australia with Colliers International director Phil Schell saying this is only just the start.
Schell is marketing the 890 hectare Kingsford Olives property in the Southern mallee South Australia for receiver manager McGrath Nicol.
The report says that earlier in the year insolvency firm PPB estimated that there was $1.5 billion worth of farms under various degrees of financial stress.
Suncorp bank has placed large scale farming enterprise Matilda Farms into receivership with Ernst & Young. Ray White has been appointed as the marketing agent of its 2,042 hectare Wando property on the Darling Downs. Matilda’s farming and processing operation at Armidale NSW is also up for sale.
The report quotes Ernst & Young’s Justin Walsh as saying:
“There will certainly be more forced sales coming in the next six months. Climate conditions and drought are a lot less to blame for this than business practices and gearing levels.
Administrator, Worrells district manager Adam Ward said:
Banks were reconsidering equity positions after taking interest only payments for several years.
Banks are now asking for at least principal payments.
In WA, Deloitte Touche Tohmatsu has placed a number of small farmers totaling almost 200 hectares in the Harvey Shire District on the market.
In NSW accountancy firm PKF has placed a number of properties on the market. The report says that the major banks are forcing smaller scale rural operations to sell up their holdings.
The Property Shop’s Hugh Bateman is quoted as saying:
I’ve seen several banks push for sales. They have held out and held out, but now they have to do what they can under the circumstances.
If you have a substantial farm debt with your bank, stay on good terms with them and pray. In my time I’ve seen many a good farmer with substantial debt, who was still servicing that debt, forced to either refinance somewhere else or to sell, because some suited bank boffin in a city high rise decided the bank needed to lower its exposure to the Agriculture sector.
A lot of the time, the reason that farmer was with that bank was because the same bank boffin some time earlier had decided they were under exposed to the farm sector and had sent their local lenders to write up new loans by offering attractive rates or terms to get the business.
As I’ve said about banks for many years:
“When it’s overcast the banks give you a beach umbrella, but as soon as it starts to pour rain and you really need the bloody thing, they want it back.”
Have your Say!
Beautiful rain - 38mm - pity we haven’t finished the barley but great for the grass and sorghum.
We need to OUTLAW CENTRALIZED WORLD BANKING and then there would be a lot less problems for little people like us.
As we move from a unipolar world to a multipolar world the rich men up the top of these privately owned central banks in the world are squashing we the middle class down while they pinch the loot for themselves.
They have lost the wars that were supposed to keep the whole system ticking along and now they wish to plonk the losses on us and they are doing just that.
As a comment from ” The Worst is Not Behind Us ” the fact that these central banks are private and above the law is a MAJOR PROBLEM.
It appears they plan to continue the policy of hyper-inflation, printing up cash and handing it out to corporations in vast quantities until it is worthless .
Greenspan, Bernanke , Paulson and a heap more WRECKERS in central banks should be arrested for enabling this credit mess but I suppose that won’t happen - they will just put the trauma on us little farmers and city people.
“The giant ‘Bank of England’ is a privately owned institution which is not subject to regulation by the British Parliament, and is in effect a sovereign world power. Like the privately owned money printing shop called ‘Federal Reserve’ in the United States, which is owned and managed by the same ‘foreign bank’ people resorting under the Bank of England’s owners.
As far as is known, those are: 1. Rothschild banks of London and Berlin. 2. Lazard Brothers bank of Paris. 3. Israel Moses Seif bank of Italy. 4. Warburg bank of Hamburg and Amsterdam. 5. Lehman bank of New York. 6. Kuhn Loeb bank of New York. 7. Chase Manhattan bank of New York. 8. Goldman Sachs bank of New York.
In their green ink and paper print shop, the Federal Reserve, the remaining stock is held by their Chemical Trust and the Rockefeller Trust. This financial cartel also runs ‘The City of London” which dominates the world’s speculative markets. A tightly interlocking group of corporations, involved in raw materials extraction, finance, insurance, transportation, and food production, controls the lion’s share of the world market, and exerts virtual “choke point” control over world industry.
And the banks are gobbling up one another - thats great for competition !!!!NOT - ****** awful state of affairs - and it ain’t going to get better for a while either - at least its raining that’s something.
Interesting story on Landline yesterday about how Russian farmers were wiped out in the 1990’s
and are only now on the way back - the Russian government now wants their own farmers and food security.