Companies Combine to Encourage CAIS Contributions

GUELPH - Mar 15/04 - SNS --The Bank of Montreal and Farm Associated Risk Management Services Corporation (ACC Farms) are offering farmers low interest loans to help them roll money into the Canadian Agricultural Income Stabilization (CAIS) program, but still pay down higher interest rate debt.

Under the scheme, the two companies will offer farmers need to place the CAIS account with ACC Farms to quality for loans at prime minus 0.7% in hopes they will borrow the money needed to make their maximum CAIS contribution. The companies said making the full deposit will make individuals eligible for the complete payout, should it be triggered. Bank of Montreal will host and manage the individual farmer CAIS program accounts.

ACC Farms, which is owned by ACC Farmers' Financial, says it will pay an interest rate on the CAIS funds of prime minus 1.95% for a net borrowing cost of 1.25%.

"The low cost borrowing also makes it an easy decision for farmers to use their Net Income Stabilization Account (NISA) funds to pay down existing higher interest debt, rather than just rolling their NISA dollars into their CAIS program account - providing farmers with a far more effective use of their NISA dollars," states Brian Hughes, ACC Farms President.

The new program is open to all farmers across Canada with the exception of Quebec which is administering their own program. Farmers wishing to take advantage of this new program need to do so 15 calendar days before each provincial deadline date.

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