THE chief executive of Australia's biggest bank has refused to cave in to political pressure and impose a moratorium on farm receiverships.
Commonwealth Bank of Australia's (CBA) Ian Narev responded to allegations on a radio program with Alan Jones that the CBA-owned Bankwest was "terrorising" farm clients and should stop collecting mortgage payments from drought-stricken farmers in the same way ANZ agreed to on Thursday.
Mr Narev said his agribusiness head had told him: "Ian, we are not about to toss anyone off their land in NSW and Queensland. We don't need a moratorium."
Federal independent MP Bob Katter said that without a moratorium he believed up to 2 million cattle could die. But he admitted some farmers shouldn't be farming. "I can't save every farmer and it's not desirable that we do. It's healthy for 3 to 4 per cent to be dropping out every few years."
CBA will provide a business loan or mortgage repayment holiday for farmers and interest-free periods for an agreed term, extend the business or mortgage loan term agreement and waive fees and charges.
Australia's biggest agribusiness lender National Australia Bank (NAB) and Rabobank have taken similar measures. Rabobank said it would not offer a moratorium but said its farm assistance package for drought-affected farmers, which started in February, was working well.
That package includes "carry on" finance to keep viable operations running and a waiver of break costs on early redemption of Farm Management Deposits to allow access to funds.
NAB said there was no need for a moratorium. Of the bank's almost 30,000 agribusiness customers across the country, it has foreclosed on seven customers in Queensland and north-west NSW in the past 12 months.
"We currently have no plans to foreclose on any [more] of our drought-affected customers in Queensland and north-west NSW. Foreclosure only occurs after a lengthy period of consideration and evaluation that includes an extensive farm debt mediation process," the bank said.
In April last year The Australian Financial Review reported that at least 80 significant farming operations across Australia, worth more than $1 million each, were in receivership or some form of distress, and that there were more likely to fold due to high costs, depleted income and sliding land values.
In June last year the Supreme Court of Queensland issued a warrant for the seizure of two cattle stations at Hughenden in central Queensland, after an application from receivers PPB representing the ANZ Banking Group. That incident was the beginning of several messy receiverships in the central Queensland area.
Richmond Mayor John Wharton and receivers representing his bank reached boiling point in 2012 after the two sides ended up in a dispute about the sale process of about $7 million worth of auctioned cattle stations.