Bank cops flak from some Canterbury businesses

10:01 pm on 14 October 2010

Some Canterbury business owners have lashed out at one of the country's largest banks, accusing it of charging them high interest to cover its losses from the global financial crisis.

The claims were made at a seminar in Christchurch for more than 400 National Bank customers.

What started as an optimistic economic briefing turned bitter towards the end, with one owner calling the bank "the enemy" and accusing it of creating and profiting from the housing bubble that burst two years ago.

The owner of the Ashley Hotel near Rangiora, Linda Duncan, says the bank needs to shoulder responsibility for its past mistakes.

Ms Duncan says New Zealand has suffered dramatically because of gross lending to companies like Lane Walker Rudkin, which collapsed last year.

She says the bank has heard its customers' frustration very loudly and she's sure it is changing the way it operates.

The bank's chief economist, Cameron Bagrie, told the seminar however that the global financial crisis was partly caused by cheap and easy credit and that the bank couldn't go back to that.

2000 enterprises 'still need help'

Thousands of small businesses are continuing to operate from caravans or their owners' homes, following the 7.1 earthquake that hit the region on 4 September.

The Canterbury Employers Chamber of Commerce recently estimated that up to 150 would close because of the quake.

National Bank's Canterbury area manager, Rodney King, says that most businesses are out of immediate trouble but that about 2000 enterprises across all banks still need help.

Mr King says his bank has begun working with those companies that are already failing.

Think further out, economist advises

Mr Bagrie told the seminar that businesspeople should lift their sights above survival, above even repairing the city to the level it was before the quake.

He said the $4 billion to be spent rebuilding Christchurch over the next two years must be used to reposition the city for a national economy changing from one based on consumption to one based on producing goods and services for export.

Christchurch's economy will have a very good year in 2011, he said, but the region has to look forward 20 or 30 years.