Bank ‘comfortable and confident’ with debt levels

All major organisations carry some level of debt, used to finance capital expenditure, investment opportunities and provide working capital when necessary.

But ensuring a business has the appropriate checks and balances in place is essential to keep the debt as a tool, not as a burden.

“It’s all about confidence,” says Tiwha Puketapu, Chair of Ātihau- Whanganui Incorporation’s Audit and Risk Committee (ARC). “In order to be able to grow our business by diversifying in alignment with our core business of farming, we need to have the money behind us to make decisions about the opportunities open to us.”

“But we need to have confidence that our debt levels are within the protocols we have in place internally, and, most importantly, our bank needs to have confidence in our ability to service the principal and the interest of any loan.”

And that confidence is strong, according to Rob Gemmell, the Incorporation’s agribusiness partner at BNZ.

“We have a longstanding relationship with Ātihau-Whanganui Inc,” he says. “Governance boards over the years have taken a sensible and reasonable approach to debt, using it wisely, and we have always been comfortable with the financial position of the business.”

“The Incorporation has a strong balance sheet, sound financial performance and scores highly in the environmental, social and governance non-financial measures that form part of our risk assessment process.”

“Any concerns about the debt levels or debt management at Ātihau- Whanganui Inc would be raised with the Audit and Risk Committee promptly.”

Chair of Ātihau-Whanganui Inc, Mavis Mullins, acknowledges the close working relationship the business has with BNZ.

“Ensuring our borrowing is tied to specific growth strategies and projects maintains the clarity around the investment and future returns,” she says. “We also formulate a clear repayment strategy for any lending which is well-embedded into the business and any strategic decisionmaking.”

“I also acknowledge the work undertaken by Tiwha and the ARC board in conjunction with Rob and BNZ that enables us to continue to grow and adapt as an organisation.”

“The clear message we receive from our banking partner BNZ is that they are happy with where we are currently and keen to help us with any financial support we may need to move our business forward,” says Tiwha. “Good governance and management has put Ātihau-Whanganui Inc into the best position possible, and we plan to build on those foundations as we look to the future.”