2 Jun 2010

Benefits seen from Super Fund rural investments

6:05 am on 2 June 2010

A financial services specialist says the heavily indebted rural sector would benefit from a fresh injection of money.

The New Zealand Superannuation Fund is looking at investing in farming here and overseas as one of the strategies it's been developing.

Chief executive Adrian Orr says it's hoping to invest up to $500 million in rural land over the next three to five years and some of that will be in New Zealand.

PriceWaterhouseCooper says new sources of equity from the likes of the Superannuation Fund would relieve pressure on the rural sector.

New bank welcomed

Meanwhile some rural interests are hoping that competition from a proposed new bank might loosen the purse strings on lending to the sector.

Pyne Gould Corporation, the Canterbury Building Society and the Southern Cross Building Society are holding talks on merging to form a bank next year.

Pyne Gould chief executive Jeff Greenslade says it would have a regional focus in its lending, targeting small businesses in the urban and well as rural sectors.

The Real Estate Institute is among those who would be glad to see a new lender on the block.

President Peter McDonald, has blamed banks tightening their lending as one of the reasons for farm sales drying up, especially dairy farms.