Hubbard report says progress slow

Allan Hubbard. Photo / Supplied

Only one in five borrowers is paying interest on their loans to Aorangi Securities, the statutory managers of the business affairs of Timaru businessman Allan Hubbard say.

The fifth report by Richard Simpson, Trevor Thornton and Graeme McGlinn, of Grant Thornton New Zealand, says Hubbard Management Funds performed well in October.

The managers made a first payment to Aorangi investors in October and said they wanted to make another payment by mid-2011 but this would depend on the outcome of negotiations with borrowers.

The process of sorting out Aorangi Securities continued to be hampered by a lack of information, including missing or non-existent loan documents and limited or no recent financial information from borrowers.

Various parties were claiming deals with Hubbard but they were never documented. The analysis before advancing the loans had not met a standard that the manager would expect for loans.

Aorangi has 31 mortgage loans totalling $59 million as at August, 15 direct investments, including 12 farm investments, and a $24 million loan to Te Tua Charitable Trust.

The report says it is unlikely any of a $10 million related party loan to the Hubbards' Southbury company will be recovered.

The managers have been approached by a number of groups and individuals interested in acquiring one or several farms. They said they were conscious of the potential negative impact of a large number of farms coming on the market at once.

Commenting on HMF, the managers said it was a volatile portfolio and changes in value could be more than $1 million in a day.

Applications to be filed by March 31 next year will seek to determine the entitlements of investors to the assets of the fund.

- NZPA