Regulator hits back at Companies Office flak

Perpetual Trust has hit back at Companies Office criticism of its record in overseeing finance companies during the meltdown in the sector over the past three years.

Perpetual and Covenant Trustee were between them the frontline regulators for most of the 30 or so companies that failed in that time.

In March the Companies Office told Parliament's commerce committee Covenant and Perpetual were slow to detect adverse financial issues developing and they responded too timidly to circumstances where investors' interests were being put in jeopardy.

But this week Perpetual chief executive Louise Edwards told the committee she believed her firm had "acted proactively, responsibly, and to the full extent of our powers" during the period of the collapses.

"We cannot accept that failures occurred because of our actions, or our failure to take actions that were open to us under the regulations that were then applicable."

But she said in some cases trust deeds "were not robust enough to withstand the strain the unprecedented financial and economic environment put them under".

She also said disclosure requirements under the existing regulatory regime "in themselves proved insufficient to protect investors".

Perpetual, like the Companies Office, also laid much blame at the feet of finance company directors and "variable standards of some audits".