Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Irish central bank seeks provisional administration at CBL

Irish central bank seeks provisional administration for CBL's European unit

By Paul McBeth

Feb. 27 (BusinessDesk) - The Central Bank of Ireland sought a court order to appoint provisional administrators to CBL Corp's European unit, following similar action from New Zealand's prudential supervisor, to avoid a "disorderly failure" of the insurer.

KPMG's Kieran Wallace was appointed provisional administrator to CBL Insurance Europe dac by the High Court on application from Ireland's central bank, which the regulator said in a statement was to protect the insurer's policyholders. The regulator had been in talks with CBL's European unit for months to fix what it viewed as a number of breaches, including a weak financial position, and the insurer's inability to address those issues prompted the central bank to seek the order.

"The Central Bank has made this application as it has formed the view that CBLIE is in breach of a number of regulatory requirements and is in a distressed financial position," the bank said. "In the absence of taking this action, it is the Central Bank’s view that there could be a disorderly failure of CBLIE."

The Irish central bank action comes after the Reserve Bank of New Zealand's successful High Court application to appoint interim liquidators to CBL Insurance on Friday to maintain the assets of the Kiwi insurer, followed quickly by CBL Corp's voluntary administration to preserve value for stakeholders.

The Central Bank of Ireland said deputy governor Ed Sibley made the decision to seek the court order, saying the CBL unit "failed to make adequate provision for its debts, including contingent and prospective liabilities," had been run in a way that jeopardised the rights of policyholders," and that it was "unable to comply with its regulatory requirements in a material respect."

Earlier this month, the Irish regulator had instructed CBL's European unit to stop writing new business immediately, something the New Zealand insurer opposed, while New Zealand's Reserve Bank had been reviewing the Kiwi insurer to assess the adequacy of its reserving for a French construction business, and set the CBL unit’s minimum solvency at 170 percent and required it to consult on any non-business as usual transactions of more than $5 million.

Earlier this month CBL Corp said it was hiring advisers to sell the French construction insurance division and had triggered legal rights against the vendors who sold the Kiwi company the unit.

CBL’s stock has been suspended from trading on the NZX as the stock market operator tries to work out whether it’s kept the market informed of material information and met continuous disclosure obligations, which has also attracted engagement from the Financial Markets Authority. The shares last traded at $3.17 before being suspended, more than twice the $1.55 price the shares were sold at in an initial public offering in late 2015.



© Scoop Media

Business Headlines | Sci-Tech Headlines


21, 22, 23 December: Air NZ Workers Vote To Strike

Last week union members voted overwhelmingly in favour of industrial action in response to the company’s low offer and requests for cuts to sick leave and overtime. More>>


24/7: National Geohazards Monitoring Centre Opens

For the first time, New Zealand will have 24-7 “eyes on” monitoring of the four perils: earthquake, tsunami, landslides and volcanic activity. More>>


EU Wine Exports: Yealands Fined For "Unprecedented Offending"

Yealands Estate Wines has pleaded guilty to “unprecedented offending” under the Wine Act 2003 and has copped a $400,000 fine. More>>


Discussion Paper: Govt To Act On Unfair Commercial Practices

“I’ve heard about traders who have used aggressive tactics to sell products to vulnerable consumers, and businesses that were powerless to stop suppliers varying the terms of their contract, including price.” More>>


'Considering Options' On Tip Top Ownership: Fonterra Drops Forecast Milk Price

Fonterra Co-operative Group Limited today revised its 2018/19 forecast Farmgate Milk Price range from $6.25-$6.50 per kgMS to $6.00-$6.30 per kgMS and shared an update on its first quarter business performance. More>>