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

 

Taxpayers won’t see Nomura’s price for SCF loans until Dec

Taxpayers won’t see Nomura’s price for SCF loans until December

by Paul McBeth

Aug. 18 (BusinessDesk) - Taxpayers will have to wait until December to find out how much they’ve lost on the core loans belonging to the failed South Canterbury Finance Ltd.

That’s the earliest the market value of SCF’s portfolio of core loans, which have been sold for an undisclosed amount to Japan investment bank Nomura Holdings, will be disclosed.

Receiver William Black of McGrathNicol told BusinessDesk the next report, due on Dec. 20, will show what Nomura paid for SCF’s consumer, business and rural loan portfolios, which had a book value of $123 million, though he said it may be too early to estimate the likely recovery from the receivership.

That’s down from the $579.8 million value of the three portfolios since the receiver’s first report in November last year.

While SCF received $238.7 million in loan repayments from across its total lending portfolio, and $59 million from related party loan repayments by the end of February, it is unknown how much of this related directly to SCF’s core loans.

Black said the receiver hadn’t made any major write-downs in the value of the portfolios, and that it was a moving feast as money was repaid through the “ongoing process and prudent management” of the loan book.

The Overseas Investment Office had not received an application to buy the loan books, a spokesman said.

SCF has already sold its stake in Scales Corp. to Direct Capital for $44 million and Helicopters NZ Ltd. to Canadian Helicopters Group for $154 million. It sold more than $100 million of loans from Face Finance for an undisclosed sum to GE Capital, along with its stake in Financial Synergy Ltd. and some dairy farms for undisclosed sums.

If the sales achieved book value, that means the most SCF’s receivers have made from asset sales is about $421 million with just the so-called ‘bad bank’ assets and the 33% stake in Dairy Holdings left on its books.

Black said it is too early to give any guidance on the prospects of the programme to squeeze value from SCF’s ‘bad bank’ assets.

The Timaru lender’s property loans, which made up a large portion of the troubled assets, were valued at $256.2 million as at Aug. 31 last year when the receivers were called in.

“Managing those loans is a very significant workstream and has the potential to take up to two years to recover,” Black said. “It’s too early to give any clear guidance.”

SCF’s failure prompted a $1.6 billion call on the government’s retail deposit guarantee scheme, and the Crown paid out all other creditors to assume control of the failed lender.

The net cost of that call has ballooned from the initial $400 million to $500 million cost flagged by Prime Minister John Key.

The Serious Fraud Office has yet to decide on whether it will pursue prosecution over SCF’s failure, and is looking at a handful of the lender’s transactions. The white-collar crime investigator charged SCF owner Allan Hubbard with 50 counts of fraud in relation to his investment vehicles Aorangi Securities Ltd. and Hubbard Managed Funds.

(BusinessDesk) 17:13:44

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 




REINZ May Data: House Price Rises Continue; Auckland Hits New Record Median Price Again

Median prices for residential property across New Zealand increased by 32.3% from $620,000 in May 2020 to $820,000 in May 2021, according to the latest data from the Real Estate Institute of New Zealand (REINZ), source of the most complete and accurate real estate data in New Zealand... More>>

Energy Resources Aotearoa: Doubling Of Coal Use Shows Need For Local Natural Gas

New figures showing a near doubling of coal-fired electricity generation highlight New Zealand’s energy shortage and the need for natural gas as a lower carbon alternative, according to Energy Resources Aotearoa... More>>


E Tu: ‘Sense Of Mourning’ As Norske Skog Mill Set To Close

Workers at Norske Skog’s Tasman Mill now know they’ll be losing their jobs in little over a month’s time.
On Wednesday afternoon, workers were told the mill will be stopping production from the end of June... More>>



Auction: 1.4 Million In Rare Vintage Watches, Gems, Jewels & Diamonds Go Under The Hammer At Webb’s

An auction event showcasing over 1.4 Million dollars in rare jewels, gems, diamonds and vintage watches is due to take place this Sunday by Auckland based auction house Webb’s... More>>

Catalist: NZ’s New SME Stock Exchange, Gets Licence To Go Public

New Zealand has a new stock exchange – designed specifically for small and medium-sized businesses (SMEs) to raise up to $20 million a year from the public.
Called Catalist, the exchange has already been successfully working the private investment sector.... More>>

E-Commerce: Over 40% Of Those Engaged In The Bitcoin Community Are Millennials

Bitcoin has emerged to be a popular topic among millennials with digital currency increasingly being viewed as a potential source of creating wealth through investments. The interest in bitcoin by millennials signals the role this age group plays in the possible realization of the digital currency’s mass adoption... More>>