IFA PRESIDENT ACCUSES FINANCIAL REGULATOR OF STIFLING INVESTMENT IN AGRI SECTOR

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IFA PRESIDENT ACCUSES FINANCIAL REGULATOR OF STIFLING INVESTMENT IN AGRI SECTOR
30 May 2012

IFA PRESIDENT ACCUSES FINANCIAL REGULATOR OF STIFLING INVESTMENT IN AGRI SECTOR

Farm Business & Credit

Speaking at a seminar organised by the Bank of Ireland in Kilkenny last night (Tues), IFA President John Bryan criticised strongly the Financial Regulator’s office for imposing a layer of bureaucracy that is delaying decisions on loans to farm businesses, resulting in massively increased costs. “When we needed strong regulation of banking, we did not have it.  Now that the horse has bolted, and the country is in crisis, the level of over-regulation is stifling investment.”

John Bryan said the Government needs to take control of this situation and instruct the Regulator to ensure that applications for loans are cleared within a number of weeks, and not the current timeframe of up to six months. He said the costs of borrowing must also be reduced. “Farmers cannot be expected to pick up the tab for poor lending practices in the past, by paying excessive repayment rates now.”

He said, “The farming and agri-food sector has ambitious growth plans as part of Food Harvest 2020. These plans will require significant investment and if the Financial Regulator does not reduce the layers of bureaucracy to allow the process to be speeded up, he will stifle the prospects for the sector.”

John Bryan said, “I am receiving complaints from all over the country from farmers who are frustrated because of the length of time it takes to get loan approval. These farmers have an excellent repayment record, substantial assets and a solid business plan. The delays they are experiencing are acting as an obstacle to their growth plans.”

He said, “Past credit history must be taken into account. The farming and agri-business sector has always shown a strong commitment to meeting their credit obligations. The most recent National Farm Survey shows overall debt on farms down by 20% compared to 2010.”

Concluding, the IFA President said a common application process for farm business would expedite the process. “I understand work on this is ongoing. It should be completed as soon as possible to give farmers maximum flexibility and certainty around the application process, and to improve competition between the banks.”

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