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Shares in stricken finance company Dominion Finance slumped 80 per cent after trading resumed following Tuesday's suspension.
The company said on Tuesday it was considering a moratorium on payments to debenture holders after becoming concerned about the liquidity of its two subsidiaries, Dominion Finance Group and North South Finance.
The shares fell to 10 cents, from 50 cents before their suspension. They have fallen from a record high of $2.86 in May 2007.
The board had begun talks with bankers, auditors and trustees to explore the prospect of a moratorium, chief executive Paul Cropp said on Tuesday.
At March 31, debenture holders were owed $276 million, down from $350 million a year earlier.
Liquidity problems were a reflection of the global credit crisis on investor confidence, and the inability of DFG and NSFL's borrowing clients to refinance or repay debts, Mr Cropp said.
Dominion Finance continued to trade profitably, with net profit after tax for the months of April and May of $2.61m.
Reinvestment rates had halved to around 20 per cent in April after industry counterpart Lombard Finance hit trouble.
More than 20 finance companies have failed in the last two years, in part reflecting the effects of a global credit crunch.
Dominion Finance debentures funded about 60 per cent of total assets, with the balance made up of equity (11 per cent), capital notes (9 per cent) and banking funding facilities (20 per cent).
The Stock Exchange is investigating whether Dominion Finance breached continuous disclosure rules about its situation before two of its subsidiaries fell into strife.
NZX's acting head of market supervision, Simon McArley, told Radio New Zealand yesterday it would be talking with the Securities Commission and expected its investigation would take a week.
He agreed it had been a short period between company assurances that the business was viable and its present troubles.
There have also been questions raised over the timing of Dominion Finance's latest attempt to raise more cash.
In a letter dated May 23 it offered investors an "exclusive special" interest rate for secured first ranking debentures at between 10.75 per cent and 11 per cent for up to 18 months.
The company's letter said it was continuing to operate its business as usual and was making good profits.
The directors and possibly the trustee, Perpetual Trustee could be liable under the Securities Law if the company attempted to raise money when they knew the company was in trouble.
- NZPA
