South Canterbury Finance recovers $202m

South Canterbury Finance Ltd reported today a $202 million recovery of outstanding loans since January 1.

The Timaru-based finance company said it had cashed up about 10 per cent of total assets since the beginning of the year, in addition to normal maturing and repayment of consumer and business loans.

The company said a significant proportion of the recoveries was achieved by its specialist asset management team working to realise assets in its portfolio of non-core and non-performing loans.

It includes advances to farms, property developments, vineyards and to corporate entities along with sales of various investment assets.

Chief executive Sandy Maier said the process of collecting old loans and making new loans was essential as the company's business was restructured.

South Canterbury's restructuring was intended to restore its position as one of the leading lenders for business growth and development.

"Asset recovery complements our efforts to attract new investors and encourage existing investors to re-invest with the benefit of the Crown's extended retail deposit guarantee.

"Specialised asset recovery makes a very useful contribution to the overall cash position furthering debt repayment and investment in fresh lending."

The company said the specialist asset management team examined every loan in detail and developed a recovery plan for each.

"These loan realisations and our ongoing attention to servicing our loyal debenture investors are a result of much hard work and dedication in difficult circumstances."

The company said the recovery process was facilitated by the renewed interest of trading banks in financing and sound asset propositions.

Maier said the positive signs in the market and the momentum already achieved by its asset recovery team would enable the company to substantially increase its total cash realised from the asset base this year.

"Certainly progress has been assisted by the increase in the forecast payout to dairy farmers. We are also receiving the occasional approach from investors targeting specific assets in the portfolio."

- NZPA