Allied Farmers says the assets it acquired from Hanover and United Finance in December are now worth only a quarter of their purchase price.
Following a recent independent valuation, the listed rural services company says the value of the loan book has fallen by further 17%, from $105 milllion to $87.5 million.
Managing director Rob Alloway says the amount set aside for impairment provisions in the June accounts may have to be increased, but it's still too early to determine by how much.
Hanover's assets were worth $396 million when Allied acquired them in December.
In March, they were valued at $175.5 million.