Debenture holders in failed lender NZF Money face a likely shortfall as the receivers expect to write down the value of loans on its books.
Receivers Grant Graham and Brendon Gibson of KordaMentha expect to make a "material" impairment to the $28.3 million loan book, which will probably lead to a shortfall for debenture holders owed some $16.4 million.
Unsecured creditors owed $115,000 will probably go away empty-handed, they said in their first report.
"We are continuing to review the loan book and have commenced the process of collection of outstanding loans," the report said.
"We note however that several loans of significant size have already been subject to previous restructuring, and in many cases valuations for security properties are well out date.
These factors, logically give rise to concerns that there will be a material level of impairment in the loan book."
NZF Money, the deposit-taking subsidiary of NZF Group, was put in receivership in July after its parent failed to secure short-term funding needed to keep the finance company afloat.
The shortfall became evident after the Financial Markets Authority forced the company to pull its debenture prospectus which hoped to raise $350 million over the issues around asset quality and liquidity disclosure.
Since the receivership began, some $33,000 in employee entitlements have been paid.
The report said the company has several security interests with Motor Trade Finance Ltd., Marac Finance, Magnolia Lee Lease & Rentals, and UDC Finance.
Receivers noted that they had yet to receive a claim from the Inland Revenue Department.
In addition to its loan book, Korda Mentha said the company had an estimated $1.7 million in other assets which would be realise, consisting of inter-company loans, subordinated notes owned by NZF Mortgages, cash holdings and fixed assets.
Shares in parent company were unchanged at 3.5 cents today, and have declined 77 per cent so far this year.