Marac admits errors, and says not again
Marac's parent company, Pyne Gould Corporation (PGC) has announced that it plans to raise $237million through a fully underwritten pro-rata renounceable Rights Offer.
Wednesday, 23 September 2009
The offer, which is underwritten by First NZ Capital Securities, and is part of a plan to get achieve its goal of becoming a publicly listed banking and asset management company.
The company says that the capital raising has a number of benefits for MARAC investors:
During a press conference PGC admitted that Marac had made mistakes during the boom, but it assured investors it has learnt the lessons.
One of the mistakes was that it "strayed" into property development to source profits and enhance dividends.
It said there was insufficient portfolio information going through to the board, especially around second mortgages. Also relationship managers were given too much discretion around what deals they could do.
It says there was "insufficient division of responsibilities with respect to risk at a senior level"
These issues were being addressed and Marac was going to stick to what it knows best, plant and machinery, also it was establishing a risk committee along with a dedicated chief risk officer with independent accountabilities to oversee future lending.
PGC Presentation [PDF 488KB]
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