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Crown guarantee scheme set to lose money on Vision Securities
As Treasury starts repaying investors' in government guaranteed Vision Securities, the collapsed property financier's receiver is warning it will collect significantly less than is paid out to investors.
Treasury made its first payment to some Vision Securities investors' last week. The company was placed in receivership by trustee Perpetual Trust at its directors’ request after the failed settlement of a mortgaged property on March 26.
The settlement of that loan was expected to generate about NZ$6.75 million and its failure to do so led to concerns about the firm's liquidity and ability to meet payments to debenture holders. Deloitte's Rod Pardington and David Levin were appointed receivers on March 31.
Their first receivers' report says 958 debenture holders were owed NZ$28.4 million. Unsecured creditors' were owed NZ$1.2 million. Vision Securities has 16 loans, the receivers say, mainly in subordinate positions in property developments at various stages of completion throughout New Zealand. Its assets are largely finance receivables secured by second mortgages.
Given the complexity of their review of the company's loan book, Pardington and Levin said expert advice had been sought from valuers and real estate agents. They were waiting for advice on some properties and at the time of the report were therefore unable to estimate the likely returns to secured or other creditors. They also note there could be a small number of investors' who don't have eligible claims under the Crown guarantee scheme. Receivership proceeds will be distributed to those investors and Treasury.
"Any distributions will be significantly less than the payments made to eligible investors under the Crown Retail Deposit Guarantee Scheme."
Meanwhile, a Vision Securities investor complained to interest.co.nz in April that Treasury's repayment process was slow, vague and frustrating.
Interest.co.nz's Deep Freeze list of finance company failures shows over NZ$6.6 billion has been frozen in almost 200,000 accounts since the crisis began in 2006.
10 Comments
Great, thanks so much for
Great, thanks so much for getting the tax payers involved in shonky finance company investments, Mr Key and co. Now we can all bear the brunt of piss-poor uninformated investment decisions.
PS: Gareth, you should review your use of apostrophes - none is required after "investors" unless it is the possessive form, which it isn't the three times you have used an apostrophe.
To be fair does not the
To be fair does not the government guarantee scheme predate the coming on the Jonkey?
That said there ARE clear issues as to how companies such as SCF were let into the extended guarantee, which did happen under his watch.
HAHAHAHAHAHAHAHA Chris you
HAHAHAHAHAHAHAHA
Chris you are an idiot!
'None is required after "investors"'
You should review your use of verb conjugations. The gramatically correct statement would have been "None are required after 'investors'.
Haha ultimate fail, what a loser!
Ugh @ no edit function -
Ugh @ no edit function - should read "piss-poor uninformed investment"
Chris, Remember that Treasury
Chris,
Remember that Treasury does charge fees for companies who participate in the guarantee scheme. As of June 30, 2009 Treasury had received NZ$228 million in fees. So to provide some comfort, us taxpayers should still be ahead overall...
Gareth, sorry to go OT here,
Gareth, sorry to go OT here, but are you guys able to block IP addresses? This troll calling himself 'The Man' and 'Rich PI Troll' and other names is becoming a pain in the butt. His nonsensical spam is pushing intelligent posts off and it's gone beyond a joke now.
He may be an insane optimist,
He may be an insane optimist, but if we're going to ban people at the extremes then we'd better get rid of Wally and NA as well. I don't find The Man's or Rich PI Troll's posts overly trollish - at least not more so than negative-Nancy Wally.
Facsinating! Extreme
Facsinating! Extreme view...well I never.
I haven't been an extremity before! Rather always a moderate, actually. Preservation of capital and income, and all. Life's a funny thing.
$228 million raised in
$228 million raised in 'taxes' on the finance sector... nice going... seems that unless SCF tips over, which always remains a possibility, then the Govt will probably come out ahead on the whole Guarantee caper...
Re the Vision Securities
Re the Vision Securities investor who complained that Treasury's repayment process was slow, vague and frustrating, he's an ill-informed and ungrateful b'stard. He should can count his lucky stars and thank generous taxpayers for bailing him out. It can often take years to get even a few cents back from receivers or liquidators. The Crown guarantee pays investors 5-10 times FASTER than happens otherwise.