South Canterbury has no plans to be a bank
South Canterbury Finance plans to trim its reliance on debentures and has no aspirations to be a bank.
Wednesday, 16 June 2010
Chief executive Sandy Maier, who was brought in as a change manager on a one-year contract, told investors at a roadshow in Wellington that the Timaru-based finance company wants to reduce its reliance on depositors in what will be a scaled-down business reminiscent of its more successful past, and has no desire to expand into the banking sector.
Maier is travelling around the country giving investors an update on the company's fortunes.
As at June 9, the company had $1.326 billion total secured deposits.
"We want to get back to rural loans - we're a finance company, not a bank," he said.
The company will take between one and three years to sell down its problem assets, such as impaired property loans and related party transactions, which are held in a separate vehicle from its primary lending business, and is bringing in "several million a week," Maier said.
"If you have to do something in a hurry, you don't get very good prices," he said.
As part of its restructuring, it set up a third unit to house its non-essential businesses such as the shareholdings in Helicopters NZ, and Scales Corp, which were poured into to boost the company's balance sheet.
South Canterbury hit a turning point in the third quarter, posting a break even result after a steady stream of impaired assets pushed the finance company into loss after the collapse of the property development market and its financiers. Its veteran owner, Allan Hubbard, announced he was stepping down from the board last month.
Still, Maier says the company needs to keep bringing in money with the so-called "wall of maturities" coming due before the expiry of the initial government retail deposit scheme, though he was confident the firm's investors will continue to support it and roll over their investments.
South Canterbury is paying 8% on term deposits until the end of the extended government guarantee, which it got accepted into last month, and will offer 8.25% to existing investors as an incentive to keep their cash with the financier.
Commenting is closed
Find a Rate
12 November 2016
10 November 2016
7 November 2016
19 October 2016
14 October 2016
Cash PIE Rates
Weekly Updates including news and commentary
Disclaimer - Every possible effort has been made to keep the information in the tables and on this site as accurate as possible, however, neither the publisher, Tarawera Publishing, nor anyone engaged to compile the rates and this site accept any liability for inaccuracies or any loss suffered as a result. It is strongly advised that readers check loan details with providers. The full terms and conditions of this site can be found here.
© Copyright 1997-2016. Tarawera Publishing Ltd. All Rights Reserved.