Deposit rate news briefs

Two new online call accounts, Compass sets direction with Bridgecorp, Allied secures Prime target, One car lender happy.

Sunday, 28 May 2006

NBNZ is the last of the big banks to enter the burgeoning market, however it has a minimum investment of $5,000. Many other banks have no minimums, and Westpac recently dropped its tiered rate structure and now has one rate.

Both NBNZ and SBS are offering a rate of 7.00% with interest calculated daily and paid monthly. See how they compare here.

Compass sets direction with Bridgecorp
A new Bridgecorp-related company, Compass Capital, has launched an investment to attract maturing investments from the Bridgecorp Mortgage Trust 2.

Compass is offering secured, first ranking debt securities with four different terms from 12 months to 3 years, with rates of 8%-8.50%.

Compass will use the funds raised from the issue to fund the acquisition of certain authorised investments, primarily consisting of loans secured by mortgages over real property in New Zealand.

Bridgecorp will administer the loans made or acquired by Compass Limited on a day-to-day basis under “an arm’s length contractual arrangement”.

Allied secures Prime target
Allied Farmers has wrapped up its takeover of Prime Finance with an announcement on Friday that it has crossed the critical 90% threshold that allows it to move to compulsory acquisition.

The $2.80-per-share offer was launched on May 8 after Allied entered a conditional lock-up agreement to buy 60.09% of Prime.

Independent adviser Horwath Porter Wigglesworth Ltd rated the offer as "fair market value", with Prime's shares valued at between $2.44 and $2.88 per share.

One car lender happy
While some finance companies lending in the motor vehicle finance market have been having troubles, Motor Trade Finances Ltd (MTF) has reported total dealer earnings up 14.5% to $22.75 million for the half-year to March 31. Its return on assets increased to 7.5% from 7.1% last year.

A new regulatory environment, economic slowdown, escalating fuel prices, an over-supply of used imports and a proliferation of competitors entering the sector had contributed to the tightest operating environment experienced for some time. MTF has announced its intention to refinance $30 million of capital bonds with an issue of up to $40 million of perpetual preference shares on. The purpose behind the move is to maintain MTF's capital structure under international financial reporting standards, which would come into effect next year, and continue to fund organic growth in MTF's core activity of motor vehicle finance.

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