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Rabobank announces support for clients impacted by severe drought

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Agribusiness banking specialist Rabobank has put in place a series of measures to support clients affected by severe drought conditions in Queensland and New South Wales.

Rabobank group executive Country Banking Peter Knoblanche said most of the bank’s clients were managing conditions extremely well in the challenging drought conditions and remained in a strong position, with support provided by the bank where required.

He explained that Rabobank only had an extremely small number of problem loans in the drought-affected regions, with less than 0.2 per cent of the bank’s loan portfolio in these areas subject to current receivership action, and only one instance in the pastoral industry.

According to Mr Knoblanche, a key objective for the bank is to help any client experiencing financial difficulty to maintain their viability and keep them on the land. Any action taken is always on the basis of long-term viability, never on the basis of drought alone.

Drought support measures announced by the bank in February 2014 remain in place and are working well. As a bank specialising in the agricultural sector, Rabobank is experienced in dealing with similar conditions around the world, and has established very good practices to support drought-affected clients. These include individual agreements reached with viable clients to hold off taking action for agreed periods to allow them time to work through their financial difficulties and re-build their financial position when seasonal conditions improve.

Assistance measures offered by Rabobank for drought-impacted clients also include ‘carry on’ finance to keep viable operations running; waiver of break costs on early redemption of Farm Management Deposits to allow access to needed funds; deferral of scheduled loan payments; waiver of fees on loan increases necessary for rebuilding operations; and waiver of fees for equipment finance variations .

Mr Knoblanche added that Rabobank clients struggling with the impacts of drought, who are not already speaking with the bank, should contact their local rural manager or branch.

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