KEY POINTS:
Bridgecorp says a troubled Melbourne project will not cause the finance group any severe damage and it is still on track to deliver a small profit.
Bridgecorp's Australian subsidiary had recovered all the principal on loans to the collapsed Westpoint Corp - which developed the Bayshore retail and apartment project in Port Melbourne, Bridecorp's group managing director Rod Petricevic said yesterday.
Perth-based property developer Westpoint Corp was declared insolvent last year with losses of about A$450 million ($512 million) expected at the time.
"We won't make as much as we should have but we would have made a small profit [from the project]," said Petricevic.
Bridgecorp has been the focus of industry gossip in recent weeks, with speculation about difficulties related to projects such as the Bayshore development.
"It's all market rumours. There have been three [finance company] collapses due to advisers giving the wrong advice and the market is very twitchy and not as busy as it was," Petricevic said.
Bridgecorp had assets in the form of $660 million worth of loans issued, Petricevic said, yet the business had been the subject of negative speculation which had raised some concerns.
The group was continuing to investigate new opportunities in Australia, he said.
Not all the interest on loans to the collapsed Westpoint business would be repaid. But he rejected speculation the project would cause severe financial damage to his business.
"We're almost out of there, it's tidied up and we have received all our principal, although not all the fees or interest. But we provided for that."
Petricevic acknowledged media coverage of problems with the Melbourne deal had created its own issues.
"This loan has undoubtedly put pressure on the Bridgecorp group and the media reporting of it has meant we have had to spend a significant amount of time to ensure our investors' confidence remained strong."
Bridgecorp and another New Zealand financier - Hanover Group - are recovering loans to Bayshore through the gradual sale of properties in the Melbourne development.
The Westpoint collapse involved 10 real estate development projects in four cities and more than A$320 million from retail investors.
Petricevic said the role of receivers and managers KordaMentha on the Melbourne project was expected to be finished by the end of this month.
KordaMentha is also acting for the secured banking and finance creditors who loaned Westpoint Corp millions for its developments in Australia.
Petricevic is now investigating other projects across the Tasman, saying the east coast was a focus for his business, which has a majority stake in Asset Backed Finance, a Brisbane non-bank mortgage funder.
Bayshore
* A retail/residential project in Melbourne
* Development about 3km from the city's CBD
* A block was built with 306 apartments and 18 shops
* MFS, Bridgecorp and Hanover provided finance
* The developer collapsed, leaving loans unpaid
* Sales are allowing repayments to two Kiwi funders
