Mark Darrow says PGG Wrightson Finance has supported generations of farmers and built up a loyal following. Photo / Sarah Ivey
PGG Wrightson Finance has burst through the half-billion-dollar loan book barrier and expects to keep growing.
The loan book at the company, which is owned by listed rural services company PGG Wrightson, grew by 27 per cent in the year ended June 30 to $503 million.
Mark Darrow,
head of PGG Wrightson Finance, said similar growth was expected this year.
"If you look at the carnage in the whole finance industry, we've never seen anything like it ever before and to be able to put in performances like this is pretty special," Darrow said.
The rural economy was generally strong and pretty insulated from a lot of the broader finance market, he said.
"We are prudent and conservative lenders, and have close relationships with clients given the range of services offered by the PGG Wrightson group," Darrow said.
"We have the advantage of being both a prime lender and a provider of tailor-made solutions, such as the portfolio of seasonal finance options provided to farmers throughout the country."
The reinvestment rate was above 80 per cent, bank lines grew from $120 million to $280 million and net profit was $5.8 million, compared with $5.4 million the previous year.
"Our clients, borrowers and lenders, understand the strength of our business model and continue to support us as a specialist provider of financial services to rural New Zealand," Darrow said.
"We have supported generations of farmers and built up a loyal following, for both deposits and lending."
The business model was straightforward, he said.
"We provide full rural banking services to the rural sector, and within that we provide specialist skill and knowledge." The company benefited from being within the larger PGG Wrightson group, he said.
"The halo effect certainly helps."
Growth was expected to continue but the company would not take anything for granted, he said. "We will continue to provide support to the rural sector, which remains the backbone of New Zealand's economy."
PGG Wrightson shares closed down 1c yesterday at $2.73.
