SCF receiver puts 'good bank' assets on the market

Photo / NZ Herald

South Canterbury Finance Ltd.'s so-called 'good bank' assets are being put on the block as the recovery process hits its stride more than six months after the financier's billion-dollar collapse.

Receivers Kerryn Downey and William Black of McGrath Nicol have begun the sale of the failed lender's consumer, business and rural lending divisions and subsidiary Southbury Insurance.

The three loan books were collectively valued at $939 million in the first receiver's report, almost two-thirds of the $1.56 billion face value of SCF's loan assets. Southbury has 7,600 active life and vehicle policies, with net assets of some $1 million.

Downey and Black said they expected the sale process, to be conducted by Deutsche Bank AG, to end by the middle of the year.

The receivers put up the Face Finance loan book for sale in February, of which SCF owns three quarters. The loans, co-owned with Warren Baxter and Tim Murphy, were valued at $197 million.

The sale comes a day after the receivers secured a buyer for Helicopters (NZ) Ltd. at a price above valuation. Still, of the $160 million, it's unclear how much will go into servicing the helicopter company's debt.

The announcement also coincides with a further document dump by The Treasury, relating to the guarantee and failure of SCF, following Official Information Act requests by supporters of SCF's former chairman, Allan Hubbard.

SCF called in the receivers at the end of August after it failed to bring in new cash to keep it afloat, prompting a call on the government's deposit guarantee scheme.

The Crown paid out all other creditors to assume control of the lender, and is looking to recoup as much of the $1.6 billion payment as it can.