Farm Credit Canada is encouraging producers considering participating in the federal Hog Industry Loan Loss Reserve Program to be aware of the application deadlines and not wait to the last minute to apply.
Last week the federal government announced the application deadline for loans under the Hog Industry Loan Loss Reserve Program has been extended to March 26th and Ottawa’s share of the risk has been increased to 90 percent on loans used to repay advances received under the Advance Payments Program.
Farm Credit Canada senior vice president portfolio and credit risk Remi Lemoine says to date FCC has loaned out just over 115 million dollars under the program.
I think it’s fair to says that the uptake in the program is below expectations.
I wouldn’t say well well below but it’s below expectations.
Some of the factors, as far as FCC goes, we had already done about 175 million in refinancing and that sort of thing before the program was announced and so I think we preempted the program a little bit.
We sort of did it without the program.
We had also done quite a few payment schedule adjustments in that period.
The program expectations are that the financial institutions would apply their normal due diligence around profitability.
That’s the key factor.
Having said that, because the program loan loss reserve is in place, the financial institutions like FCC have worried less about things like the security for the loan and it’s helped keep the interest rates down in the program as well.
Lemoine notes time lines were getting tight and causing some concern but the application deadline extension will allow producers a few more weeks to get their business plans in place and creditors an extra month to complete the paperwork.
He encourages those considering participating to be wary of the deadlines and not to leave applying to the last minute.
Source: Farmscape.Ca
