Those two are now in control of the assets and undertakings of the company.
Borrowers should keep paying, FE said, but those who had deposits would not be paid.
"As a consequence of the receivership, all payments of principal and interest to deposit holders have been suspended."
The receivers will soon write to all known deposit holders advising them of the receivership and the likely next steps. Further communication with deposit holders will likely be in May when the receivers will provide further information about FEI and the receivership, the business said.
The financier is headquartered in Chorus House in Auckland.
FE Investments is an ASX listed business whose chief executive is Marcus Ritchie of Sydney. Ritchie is also a director of the New Zealand-registered FE Investments, along with Auckland's Jacob Ploeg. The New Zealand business is wholly owned by FE Investments Group in Sydney, Companies Office records show.
The Financial Markets Authority said today it had been notified of the receivership of the financier which had been unable to meet the minimum financial requirements under its trust deed, or its Reserve Bank licence as a non-bank deposit taker.
"The FMA understands this will be difficult for FE Investments investors, but the appointment of a receiver will ensure an orderly process and protect the interests of all investors in the business. Receivers have been appointed by the company's supervisor, Trustees Executor," a statement said.
Liam Mason, FMA director of regulation said: "This is terrible news for the investors in this troubled non-bank deposit taker. FE Investments has been in difficulty for some time following a number of business setbacks. Its problems were not caused by Covid-19, but there's no doubt the current economic conditions have made matters worse."
FE Investments is a relatively small non-bank deposit-taking finance company with $54.3m in retail investments, the statement said.
The majority of FEI's 617 investors are individuals, rather than trusts and other entities. Its investors are mainly - 84 per cent - based in New Zealand, Mason said.
"The FMA has been engaging with the company since late last year to ensure it was disclosing its situation accurately, and has been liaising with the company's supervisor, Trustees Executors in regard to its oversight of the company," Mason said.
The authority's role in regulating financiers like FE Investments was to ensure the firms' supervisors maintained the minimum level of protections available to investors and to ensure financial disclosures are accurate and up to date. The Reserve bank, in its role of prudential supervisor, is the primary regulator for businesses like FE Investments, the FMA stated.
The authority remained in close contact with FE Investments' supervisor, Trustees Executor and the Reserve bank to ensure that the events were being managed in an orderly way and that investors wee aware of the receivership, it said.
The FMA encouraged investors to email KordaMentha at fei@kordamentha.co.nz, telephone 09 3077 865 or write to PO Box 982 Shortland St, Auckland, 1140.
ASX-listed parent FE Investments Group was downgraded by ratings agency Standard & Poor's from BB in October to CCC in December. A CCC rating is a speculative investment and vulnerable to non-payment.
"Following engagement with the FMA, FEI withdrew its product disclosure statement in February and stopped accepting deposits or issuing debt securities," the authority said today.
The financier was established here in 2003 by TK Shim and Mel Stewart, the financier said.
"TK Shim's background was in corporate banking, with Investment relationships, cash flow lending and credit skills. He also brought a philosophy of incremental precision and oriental elegance to the company's DNA. Mel Stewart had deep roots in the rural sector and extensive experience in business and property asset based finance. His broad connections were matched with entrepreneurial flair, creative instincts and marketing skills," FE Investments said on its New Zealand web site.
One angry client said he was concerned about a deposit of some hundreds of thousands of dollars. The company had his term deposit which would soon expire but now he fears the worst.
"I hoped I might eventually get to read a bit more info in the press. Obviously my main question is how much can I expect to get back but maybe there are some bigger questions for Government," he said.
Smaller finance companies deserved support, he said.
"I knew FEI were struggling," the deposit holder said, referring to media coverage late last year.
"So I planned to reduce my exposure as soon as my term deposits expired. But that wasn't going to be until later this year and I guess Covid 19 was too much of a hit for them on top of their existing issues," he said.
Somewhere between $40m and $60m of deposits could now be at risk, he estimated.
"I could tell something was up this morning as we didn't get the quarterly interest payment on Tuesday and no one answered the phone," he said.
Visiting the web site revealed that the financier was no longer offering term deposits.
"But they were still assuring they were steadfastly committed to repaying, so I took a screenshot of their webpage at about midday today," he said.
But when he checked back just two hours later, the website was deleted and the receivership notice had been posted.
