Banking Sector Update

There are likely to be changes in banking policy going forward, driven by the outcome of the Australian Banking Inquiry.

The Banks will be more tightly regulated and the Reserve Bank will require them to hold more capital in reserves to limit over-exposure – increasing from an average of 10% up to 16% over the next five years.

They will also need larger reserves for agriculture, horticulture and commercial than for housing. Banks will be looking at their exposure to certain sectors and there could be some readjustment.

You can read more here* about why these changes are taking place.

What does this mean for you?

If you are wanting to go outside your normal banking requirements for greater seasonal finance, purchase of additional land or stock or licence for gold kiwifruit you may find it harder.

  • Keeping a close watch on your spending and overdraft limits will be essential.
  • Keeping to budgets will become more important in this environment.
  • Make sure you allow for what is coming up over the next few years, so you are not left short.
  • Don’t forget to include GST and Provisional Tax.
  • If you don’t have and keep to a budget now we strongly suggest you do. 

A little bit of preparation now could save stress in the future. Most of our clients are now on Xero, so setting up a budget is much easier than starting from scratch.

If you need help setting up a budget, please feel free to contact Angelina, who is our in-house Xero expert.


*link credit: Milestone Financial



What Our Customers Think

Great local Accountants. They provide an excellent service with great explanations for the layman. They provide accounting services for non rural clients too.

Quinn Wilson, Restaurant Owner, The Wagon
What Our Customers Think

Rural Accountants is a real asset to our business.

The team at Rural Accountants pretty much manage all our administrative tasks for the group including payroll and tax planning, ensuring we don’t pay any more than necessary. They are at the forefront of technology and have helped us get up and running with Xero and Figured which is much more efficient than the way we used to work.

Sam Jones, Managing Director, Sybton Farm Ltd Partnership
What Our Customers Think

Christine is very knowledgeable, great to deal with and knows our business well. She is also a sheep & beef farmer so knows the industry really well and understands our needs.

Rural Accountants keeps us on track through strategic and forward planning meetings throughout the year. Christine knows our business inside out so she can deal with our questions instantly.

Mathew & Gemma Barham, Hawke’s Bay Farmer of the Year 2012
What Our Customers Think

What Our Customers Think

I used to work out my GST and process it manually which would take me at least a full day every two months. The team set up reconcilliation rules and other quick tools, and showed me how to do all my reconcilliations and process my GST returns through Xero which now takes me no time at all!

Mike O'Neill, Financial Services Northland Ltd
What Our Customers Think

As a farmer, Christine understands our business and how farmers and growers operate.

We use Rural Accountants to provide a full accounting service to an orcharding partnership which operates a number of orchards with a wide spread of varieties and management systems. Rural Accountants are always timely and accurate, and their annual financial accounts are extremely easy to understand and very grower-friendly.

Paul Jones, Orchardist