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Geneva Finance early repayment to investors

22 February 2013

Geneva Finance Announces Its 31 March 2013 Moratorium Repayment To Investors Will Be Paid Out On 28th February One Month Ahead Of Schedule

NZAX-listed auto loan provider GFNZ Group Ltd (Geneva) announced that the moratorium repayment of $4.9 million due on 31 March, will be paid on the 28th February, four weeks ahead of schedule. This announcement maintains Geneva’s record of early repayment, following the early repayments of the September 2010, March 2011, September 2011, March 2012 and September 12 scheduled debenture principal repayments.

This repayment is being made under resolution 1.4(b) of the interest bearing repayment plan to repay moratorium debenture holders and BOSIAL early, either in full or in part on a pro rata basis.

Inclusive of this payment, Geneva Finance has repaid $139.0 million of investor principal and interest payments since the company entered moratorium in November 2007 owing a net $132.4 million to investors. These repayments are inclusive of interest payments to investors (including the company’s bankers) of $40.6 million, at a weighted average interest rate of 10.7%, and principal repayments to public debenture holders totaling $70.7 million.

This early repayment follows on from a number of successful funding initiatives including:
• The placement of $5.3 million of new business receivables ($3.3m in August 12 and $2.0m in January 13) into “Prime Asset Trust Limited” a scheme, that utilised this security to raise a total of $4.6m million of new funding.
• The raising of $2.8m of new equity in two tranches with the first being February 2012 and the second in November 2012.

Funding from these sources has been supplemented with positive operating cash flows and it is the combined impact of these initiatives that has put the business in position to maintain its track record of paying investors ahead of schedule.

Geneva Managing Director David O’Connell says, “It is pleasing to be in a position to continue to repay investors ahead of schedule but we are operating in a difficult financial environment and if we are to be able to continue to achieve our goals it is essential that we maintain our focus on the key challenges ahead of us.”

The re emergence of Geneva from Moratorium in November 2007, has been built around the achievement of a series of milestones, with each being achieved before progressing to the next objective. These milestones fall into three stages:

1. Firstly, from November 2007 through to January 2012, the focus was on repositioning the business model to a lower risk market segment, cost reduction, improving distribution systems for the company’s products, broaden the scope of the business with the acquisition of an insurance operation and a debt collection business to supplement the core lending activities and most importantly the repayment of investor debt.
2. Secondly, From January 12 the focus moved to improving the company’s equity position and as at the end of November 2012, Geneva had raised new equity of $2.8m, and secured a cornerstone shareholder, Federal Pacific Group Limited who now hold a 36% stake in the company.

3. Thirdly building on the above, we are now looking to expand the core business to create shareholder value. Core to this challenge, is attracting new funding at affordable rates. With this in mind on the 11th February 2013, Geneva announced it would supplement the funding initiates referred to above with the issue of this prospectus.

About Geneva

Geneva is a New Zealand-owned finance company that provides finance and financial services to the consumer credit and small to medium business markets. Geneva commenced business on 7 October 2002. Geneva's loans are originated through three distribution channels (Direct, Broker and Dealer), processed by the central sales desk then administered through a national operations centre located at Mt Wellington, Auckland.

The company borrows money by the issue of debenture stock. It also has a banking facility with BOS International (Australia) Limited.

Geneva (GFL) is listed on the NZAX. There are 224,698,631 issued shares held by 2,629 investors.

About Federal Pacific

FedPac’s operations throughout the Pacific region include investments in Banking, Personal and Business Finance, Money Transfer and Foreign Exchange Trading. The company was incorporated in 1993 and is based in Auckland, New Zealand.


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