It is the nature of banks to be fair-weather friends.
But in light of the stress the dairy industry is under right now, they really do need to take the longer-term view that they say they are taking.
Banks' lending to the agriculture sector - of which dairy generally accounts for about two-thirds - rose 7.5 per cent to $57 billion in the year to June and represents about 16 per cent of their loan books.
The debt is, of course, most heavily concentrated among those farmers who have recently bought or converted a farm. The Reserve Bank, in its May financial stability report, was already fretting about the risk, albeit non-lethal, that the dairy sector posed to financial stability.
About 11 per cent of the sector's debt was held by farmers with negative cashflow and high loan-to-value ratios, it said.
"Approximately 24 per cent of dairy debt is owed by farmers with debt in excess of $30 per kilogram of milk solids." The banking regulator's concerns will only have deepened since the May report. In the six GlobalDairyTrade auctions since then, export prices have fallen a further 30 per cent and Fonterra is now forecasting a payout of $3.85 a kilogram for the current season.
So as they glumly contemplate a large number of clients facing negative cashflow, and a significant minority of them lying low in the water in terms of equity, what should the banks do?
First of all, recognise that volatility in dairy export prices and the payout has increased markedly and looks like the new norm. Since the mid-2000s, international dairy prices have oscillated wildly, but around a substantially higher trend level than prevailed in the preceding decade. That volatility makes it hard to figure out what the medium-term trend level is. But it strengthens the case for patience and for supporting farmers under pressure rather than selling them up.
To be fair, the banks have proven reluctant to do that. They point to the fact that in 2009, the depth of the recession, only 16 farms were the subject of mortgagee sales.
Right now export prices are calamitously and untenably low given, among other things, a weak Chinese economy, the impact of low oil prices in Middle Eastern markets, geopolitical tensions around Russian adventurism and the end of milk production quotas in Europe.
Even as the banks reduce their estimates of the medium-term trend payout, they ought to stand by their own past commercial judgment.
The money that has flowed from them to dairy farmers was not exacted at gunpoint, after all. The banks are not innocent bystanders in all this and need to take responsibility for their own decisions. Not, of course, to the point where it imperils their depositors' funds, but perhaps to the point where it trims their shareholders' generally ample returns.
Second, it is not in the banks' collective interest to have a lot of distressed dairy farms coming on to the market at the same time.
It would depress land prices and the value of properties the banks hold mortgages over. No doubt they understand this.
ANZ economists in their latest Agri Focus report cite anecdotal evidence that large-scale dairying operations are struggling to attract buyers and that second-tier or distressed properties are receiving discounted offers. "The question in the rural property market is no longer whether dairy-aligned land values will fall but rather how large the fall might be," they say.
"During most downturns turnover has suffered as vendors have chosen to sit tight and wait for market conditions to improve, leaving prices soft but not in freefall." But that soft landing theory could be tested this time, they warn, as cash losses accumulate and any projected recovery gets pushed out.
If we were to see a rash of mortgagee sales of dairy farms it would be doubly problematic for the banks if, as seems likely, many of the buyers were from overseas.
They would have their own sources of finance. Such a trend would represent an enduring loss of market share for local banks in this important sector. And it would expose them to political risk. It would not be a good look for a bunch of Australian-owned banks to be seen as driving pieces of New Zealand into foreign ownership.
People do not think about land the way they do about other asset classes.
A dairy farm is not just some guy's business which, like other businesses, runs the risk of failing.
It is also a piece of the country.
It is one thing for people to come to New Zealand to farm. Good on them. But you don't need to be of Irish descent to find the phrase "absentee foreign landowner" distasteful and troubling.
At this point eyes tend to swivel in the direction of Landcorp.
Fonterra is willing to lean on its own balance sheet, in the form of a 50c-a-kilogram interest-free loan to its farmer suppliers. The Crown has a pretty sturdy balance sheet, too, and right now can borrow really cheaply.
In any case, the state-owned farmer's accounts, as of June last year, record debt of $320 million, representing just 18 per cent of its $1.75 billion balance sheet.
And with 77,000 dairy cattle it clearly has relevant expertise.
So maybe there is a potential stabilising role for Landcorp in the market for dairy properties, if that turns ugly. It need not be a long-term holder. But if it comes to a choice between state ownership and foreign ownership, it could be the more attractive option.