Lamb prices have held up at much stronger levels than expected, says ANZ’s agricultural economist Susan Kilsby.
The bank says it will commit an initial $50 million to the assistance package, but will extend that if demand for help from farmers is high.
The announcement follows an official declaration of drought yesterday, covering much of the South Island's east coast.
ANZ last month launched a package recognising the challenges faced by South Island farmers affected by extreme dry conditions.
"We recognise that the Big Dry is also affecting farmers in other areas, including parts of the North Island," says Graham Turley, ANZ Bank's managing director commercial & agri.
"Dry conditions are widespread, with localised areas of severe impact. Our package is designed to offer targeted assistance, recognising that the situation may require more complex solutions for some."
"We'd encourage farmers to act early and engage advisors to develop a plan, including a two-year cash forecast, consulting with their bankers on funding requirements."
The options available to affected farmers through ANZ are:
• Suspending loan principal repayments
• Waiving fees associated with restructuring business loans considered necessary due to impacts of extreme weather
• Waiving fees for term finance and investments which improve performance and the ability to respond to climatic variation in future years
• Waiving the interest rate reductions associated with accessing funds on term deposits ahead of maturity date
• Providing access to discounted short-term funding to help farmers get through the immediate challenges while also protecting their long-term productivity.
Turley says the impacts of drought go beyond finances and are a major source of stress for some customers.
"Serious weather events cause significant challenges and anxiety. We urge farmers to communicate regularly with their family, advisors and support networks."