Commonwealth Bank falls short on drought
WHILE Minister for Agriculture David Littleproud recognises the Commonwealth Bank's recent efforts to support drought-stricken communities, he is disappointed the Commonwealth Bank has not yet offered farmers the option to use their Farm Management Deposits as an offset against their loans.
Mr Littleproud held a drought roundtable with the banks in Canberra recently, and drought support was top of the agenda.
CBA has announced it will no longer charge drought-stricken farmers penalty interest, Rabobank and ANZ have already announced the same.
Westpac have not been charging drought affected farmers penalty interest for years and NAB scrapped penalty interest last week.
The $2 million CBA donation is roughly one five-thousandth of its near $10 billion annual profit.
The Rural Bank and NAB are both offering farmers the ability to have Farm Management Deposits used as offsets against their loans but CBA, ANZ, Westpac and foreign-owned Rabobank have not given farmers that chance.
"CBA can do better and I hope they have more serious announcements in the pipeline. They've made a lot of money out of agriculture and it's now time to give back," Mr Littleproud said.
"Government can't fix everything on its own - we all have a role to play helping rural communities in drought."
FMD offsets allow farmers to set aside and earn interest on pre-tax income from profitable years, and draw down on it when needed most.
Mr Littleproud said he has been calling for major banks to offer FMD offsets since he was first elected to Parliament in 2016.
"As Agriculture Minister, I recently held a drought round table in Canberra attended by the banks where I again sent his message loud and clear...FMD offsets help farmers in drought.
"I encourage farmers to vote with their wallets. If your bank doesn't offer an FMD offset product, tell them to go and take a running jump and go somewhere else."