The sorry list of finance company failures

Chronology of the finance company collapses:


2008


#24. June 25 2008. Dorchester

Property financier Dorchester said it will ask investors to approve a "deferred repayment plan".
It owes $168 million to debenture stock investors and $8 million to subordinated note-holders. It says it has total assets of $212 million, including $18 million in cash and that a deferred repayment plan should give the company time to realise property loan positions "in an orderly way and ensure full repayment to debenture-holders and note-holders".

#23. June 24 2008. St Laurence Ltd

St Laurence Ltd announces a halt to lending and the withdrawal of its prospectus. The company proposes a scheme where its 9000 debenture holders, owed around $240 million, would only get repaid in instalments while still making interest payments. St Laurence manages property investor St Laurence Property & Finance and the NZX-listed National Property Trust.

#22. June 18 2008. Dominion Finance Holdings

Dominion Finance Holdings (DFH) considers a moratorium on payments to debenture holders after becoming concerned about the liquidity of its two subsidiaries, Dominion Finance Group (DFG) and North South Finance Ltd (NSFL).

Debenture holders owed $276m at March 31 2008.

#21. June 6 2008 IMP Diversified Fund

A registered company owned by I-Cap Partners. It has $16.5 million in debentures on issue. Took mezzanine debt positions in bio tech and other technology-focused exporters.Chaired by former finance minister Ruth Richardson, the company got investor support for a two year moratorium on paying back capital and interest.


#20. May 28 2008: Belgrave Finance

The rapidly cooling property development market was a major factor in the collapse of Auckland-based Belgrave Finance, said its directors.
The property development financier, had a loan book of about $28 million and owes just over $22 million to about 1000 debenture investors.


#19. May 18 2008: MFS Pacific Finance, re-named OPI Pacific Finance (in moratorium)

MFS Pacific Finance stockholders approved a three-year plan aimed at paying them back more than $300 million.


#18. May 13 2008: Cymbis New Zealand (re-named Fairview)

Cymbis New Zealand is a small finance company acquired late last year by troubled Australian firm MFS. Owes $6.9m to under 797 stockholders.


#17. April 15 2008 Kiwi Finance

New Plymouth-based Kiwi Finance went into receivership owing investors $2 million.


#16. April 3 2008: Lombard Finance and Investments

The eventual payout to Lombard's 4400 debenture investors, who are owed $110 million, is likely to be between 21 and 44 per cent of their principal, say receivers PricewaterhouseCoopers.
No interest is being paid and unsecured subordinated and capital note investors owed $14 million are``highly unlikely' to receive anything.


#15. March 14 2008: MFS Boston (in moratorium)

Finance company MFS Boston staved off receivership after receiving approval from its debenture investors to wind down the business through a 20-month moratorium.
Its 1700 investors were asked to allow the company to freeze redemptions and attempt to return the $38.5 million borrowed from them in the form of quarterly instalments.
MFS Boston, is an indirectly-owned subsidiary of troubled Australian investment company MFS.


2007

#14. December 17 2007: Numeria Finance

The small financier with 480 debenture holders and assets owed $6.4 million, is associated with Capital + Merchant Finance, which was put into receivership about two weeks before. Numeria failed because of a lack of cashflow, the company's trustee Perpetual Trust said.


#13. November 29 2007: Capital + Merchant Investments

Capital + Merchant Finance Ltd and Capital + Merchant Investments breached general security agreements with Australian company Fortress Credit Corp, said receivers Grant Thornton. Capital + Merchant owes investors $190 million to 7000 investors. Secured debenture holders have been told they may recover up to 59 per cent of their investment over time.


#12. October 16 2007: Geneva Finance (in moratorium)

Geneva Finance stopped taking deposits and put a moratorium on paying interest on all investments. It owed about 3000 creditors over $138 million at the time. Investors this year approved a capital restructure plan where some of the principal invested by debenture and noteholders was converted to shares. Geneva will soon list these shares on the alternative exchange of the NZX.

#11. October 2007: Beneficial Finance (in moratorium)

Auckland company with $24.2m of investors' funds. Investors approved a moratorium on repayments until March 2009.

#10. October 4 2007: Clegg and Co Finance

Clegg had around $15m of 500 investors' funds in debentures. Covenant Trustees said Clegg's trust deed had been breached to a "significant extent". The breach of a related party loan meant Clegg had minimal, if any, residual shareholders funds.
The receiver said the investors would get between 70c and 85c in the dollar of their principal back.


#9. September 5 2007: Finance and Investments

Nelson-based car finance firm Finance and Investments was placed in receivership owing 370 investors $16 million. Finance and Investments received funding from LDC.


#8. September 4 2007: LDC Finance Ltd

LDC had 995 depositors and debenture holders owed $19.3m, and assets of $23.8m. Unsecured investors were expected to recoup up to 90 cents in the dollar and secured investors are likely to be repaid in full.


#7. August 30 2007: Five Star Consumer Finance

Five Star Consumer Finance's prospectus showed it owed $57.6m at March 31, 2006, in various dated debentures and had lent out $68.7m. Investors have been told to expect a payout of between 20 per cent and 25 per cent.


#6 August 29 2007: Property Finance

Property Finance had debentures of over $80m and loans of over $630m. It reported it was in deep trouble and unlikely to be able to honour its debts. Came out of receivership February 8 2008 and resumed payments to investors.


#5. August 21 2007: Nathans Finance

Nathans Finance went under owing $166m to around 6000 investors. Nathans was a wholly owned subsidiary of vending technology company VTL Group Ltd. Receivers estimate investors may recover between 20 per cent and 25 per cent of their money.

#4. July 2 2007: Bridgecorp

Specialist property financier Bridgecorp, defaulted on repayments of some term investments. Owed about $500m to 18,000 investors. In April this year receivers slashed the estimated payout from a range of 19c-63c in the dollar to 16c-51c.

2006


#3. August 2006: Western Bay

Tauranga-based finance company Western Bay went under owing more than $48m to investors and having lent $53m in loans. In December 2007 receivers announced a second payment to debenture holders, estimating an eventual recovery of 81c to 82c in the dollar.


#2. June 2006: Provincial Finance.

Receivership seen as best way to protect the interests of debenture stock holders, who had invested $300m with Provincial. Investors have had a total payout so far of 72.5 cents in the dollar.

#1. May 2006: National Finance 2000.

Where it all began. The company held deposits of $25.5m on behalf of 2026 investors, and had made loans totalling $27.3m to 3765 individuals or companies. In March 2008 the receiver said secured investors had received back 40c in the dollar.

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