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

 

CBL drives FMA to seek clarity

CBL drives FMA to seek clarity over continuous disclosure obligations in voluntary administrations

By Paul McBeth

May 17 (BusinessDesk) - The Financial Market Authority will go to the courts for help in unpicking whether continuous disclosure rules still apply to listed companies if they enter voluntary administration.

The market watchdog said in a statement it intends to file a case stated procedure on the issue, which lets the regulator seek the court's opinion on a point of law without taking action against a particular party. The FMA expects the case will provide greater clarity for all parties and set future expectations around how continuous disclosure interacts with the orderly insolvency actions.

"The circumstances surrounding the voluntary administration of CBL Corporation Limited have illustrated the legal complexity of ensuring compliance by a listed issuer in voluntary administration," the regulator said. "The FMA acknowledges that the case stated procedure will not result in timely information being provided to shareholders of CBL in this instance, and the FMA will continue to consider other avenues for securing the release of some information for their benefit."

CBL's administrators last week recommended liquidators be appointed, enabling deeper investigation into the insurer's insolvency procedures. It appointed voluntary administrators in March after the Reserve Bank sought an interim liquidation of the New Zealand supervised arm and the Central Bank of Ireland made similar moves against CBL's European division.



The Auckland-based insurer had its stock suspended from the NZX on Feb. 8 amid concerns from NZX Regulation about the information it had given the market, following engagement between it, CBL, the Financial Markets Authority, the Reserve Bank, and a number of overseas regulators with prudential oversight of CBL’s international insurance business. On Feb. 20, CBL Insurance told the Reserve Bank it was continuing to operate despite being below the minimum regulatory solvency level.

The FMA today said continuous disclosure is an important feature of maintaining a fair, orderly and transparent market.

"We consider the information released under continuous disclosure remains important to shareholders even when a listed Issuer is in voluntary administration, as shareholders seek to make assessments of the valuation of their holdings and how they may exercise any other rights they have in relation to those holdings," it said.

The regulator said it won't comment further at this stage.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Reserve Bank Holds Rate: Dollar Jumps As Potential Hike Wrong-Foots Traders

The New Zealand dollar jumped just over one US cent after the Reserve Bank's bias towards eventually hiking interest rates - rather than cutting them - wrong-footed traders who were more wary about global risks. More>>

ALSO:

Dolphins, Albatross, And... Four Endangered Sea Lions Dead In Nets In One Week

Forest and Bird: Four endangered NZ sea lions have been killed in commercial fishing nets in one week, making this the third day in a row endangered animals have been confirmed dead at the hands of the commercial fishing industry. More>>

ALSO:

Solar: Falling Battery Costs May Outstrip Transpower Projections

Falling solar and battery costs may already have overtaken prices assumed in Transpower’s latest modelling of the future power system, the Sustainable Energy Association of New Zealand says. More>>

ALSO:

Dire Deals: SAFE Salutes Short Shrift For Saudi Sheep

SAFE applauds the Government’s decision to cancel the controversial Saudi sheep deal, a plan by the previous Government which was to include a $10 million slaughterhouse in the Saudi desert. More>>

ALSO:

Nelson Fires: Extended Emergency

A combination of benign weather and outstanding fire management has seen the risk posed by the Pigeon Valley fire significantly reduced for some areas. More>>

ALSO: