South Canterbury receivership, triggers $1.6 bill Crown payment
Chief executive Sandy Maier said the appointment of receivers Kerryn Downey and William Black of McGrathNicol was inevitable once it became clear talks for new money wouldn't be completed by the close of business today, when its trust deed waiver expired.
The collapse means the government faces a net liability in the ball-park of $600 million to cover SCF's 35,000 eligible investors, once the receiver has clawed back cash from asset sales.
SCF's so-called ‘good bank', which holds its main financing business, was "largely" restructured to separate it from the non-performing assets ring-fenced in the ‘bad bank', Maier said.
Maier "has been acting like a quasi receiver for some time - trying to sell assets and extract them from whatever loans they can do" and the receiver will continue to do that, said Fergus McDonald, fixed-income manager at Tyndall Investment Management.
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