The effects of the Hubbard trouble on South Canterbury Finance remain unclear.
But the financier has already been on a rocky ride as its big profits turned into losses in the wake of the financial crisis.
South Canterbury Finance is still seeking $1.25 billion to renew $1.9 billion in expiring
investments.
Corporate fixer Sandy Maier is now chief executive, said to have Treasury's "imprimatur" on him he has a good reputation for turning around troubled businesses. But new auditors Ernst & Young have warned of fundamental uncertainties over assumptions that South Canterbury can continue as a viable business.
This week, Standard & Poor's again downgraded South Canterbury Finance's credit rating, following a downgrade in May.
The agency warned that decision to put Hubbard into statutory management might impact on its ability to raise funds.
Maier says it shouldn't as it is still subject to a government guarantee.
The finance company's rating, B-, is now below the level required to qualify for the Government's extended Retail Deposit Guarantee Scheme.
But investors remain covered by the scheme because South Canterbury qualified for the guarantee earlier this year when its rating was BB.
Maier has separated the good assets from those he describes as a "bad bank" with loans of about $500 million, mainly to the property sector.
In some respects that sees him acting like a receiver for parts of the company.
To help shore up the business Hubbard, South Canterbury's majority owner, transferred his $152 million stake in huge apple, dairy and helicopter businesses into the South Canterbury fold and a fund associated with businessman George Kerr has also upped its facility to the business by $25 million to $100 million.
Hubbard, chairman for decades, has left the board and has been replaced by Queenstown accountant Bill Baylis. But Hubbard has openly declared he is working to find a "partner" to inject about $200 million equity into the business.
