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The chief executive of Lombard's trustee Perpetual Trust says she expects to receive Lombard's moratorium proposal early next week and will scrutinise the details before making a recommendation to the finance company's debenture stock and note holders who have millions tied up in the business.
The Christchurch-based trustee firm, which has had to deal with seven troubled finance companies in the past year, was told of Lombard Group's decision to seek a moratorium for its subsidiary Lombard Finance and Investments on Wednesday.
Perpetual's CEO Louise Edwards said the firm required monthly reporting from all its companies and had had even closer contact with its finance firms since the problems in the sector began to emerge last year.
She said Perpetual would continue to ensure debenture holders' interests were protected until it received the documents and would then consider whether the moratorium was the best course of action for investors.
Edwards could not give a timeframe on how long it would take to make the recommendation but said the company would do its best to make a decision as soon as possible.
Lombard is hoping to get the proposal out to investors within the next 10 days. A meeting to vote on the proposal would then be held three weeks after that. If approved the moratorium would suspend any repayment obligations from April 2. Any money received since April 2 would be placed in a trust account.
