Finance insights from Jobs Summit survey

Media release
24 February 2009

Finance insights from Jobs Summit survey

A Business NZ survey suggests the credit crunch may not be as widespread as thought.

Earlier this month Business NZ surveyed 647 companies to help inform its recommendations to the Jobs Summit this week.

The companies were asked about recent incidences where credit lines were withdrawn, or applications for debt financing or a credit injection were rejected.

Between 8 and 10% of respondents considered the rejection to be unjustified, given their current and likely future profitability.

Business NZ Chief Executive Phil O’Reilly said this was a negative outcome, but not as significant as generally believed.

“It indicates that banks and other financial institutions are still seeking to lend, but that more stringent conditions are being attached.

“It may also indicate more businesses are self-regulating and making fewer approaches for finance in the light of current economic conditions.”

The survey prompted suggestions on how to get better access to capital from banks and other financial institutions.

Respondents said they would like better communication by banks (41%) and help from advisory services (22%).

They did not think that changes to the NZ Superannuation Fund (70%) or KiwiSaver (65%) would have a positive impact on employment in the next 12-24 months.

Mr O’Reilly said he looked forward to representing the ideas of his members on finance and other issues to the jobs summit and to the Government’s normal policy development processes.

Business NZ recommendations to the Jobs Summit are here on www.businessnz.org.nz

Business NZ survey results relating to finance are here on www.businessnz.org.nz

ENDS

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