A Westpac executive has defended lending policies in response to complaints that, after a readiness to lend during the dairy boom, banks tightened purse strings too much in the recession.
The head of agribusiness at Westpac, Dave Jones, says his bank did not change its risk assessment policy.
What has changed is the market, he says. Commodity prices, payouts and gross farm income fell while expenses and interest costs went up.
Mr Jones told Federated Farmer representatives at last week's national council meeting that the capacity to reinvest or to service loans was no longer there.