South Canterbury Finance accepted into new Govt guarantee scheme

South Canterbury Finance is looking to offer longer term and new deposit products, following the company's approval for the Crown's extended retail deposit guarantee scheme.

The scheme will provide eligible investors a Crown guarantee until the end of 2011.

South Canterbury Finance chairman Allan Hubbard said a major milestone had been achieved, with the company regarding acceptance into the extended scheme as a "seal of approval".

It was the next step in the journey back towards the company's traditional role as a source of funding to support economic growth," he said.

Acceptance into the extended scheme was further acknowledgement of the strides the company had taken in recent months to retain a Standard & Poor's BB credit rating, increase capital, restructure, improve governance, purge the loan book, and reorganise the business.

South Canterbury chief executive Sandy Maier said a diversified suite of longer term and new deposit products could be offered, following the acceptance into the extended scheme.

Those products would provide an orderly transition for the company, investors and the Crown from the guarantee scheme and provide a stable long term funding base, said Maier.

While the extended guarantee provided additional comfort to investors, South Canterbury was confident it could return to its long term position of being a successful and profitable leader in the non-bank sector.

PGG Wrightson Finance chief executive Mark Darrow said his company's acceptance for the extended scheme provided a longer period for a transition back to a normal situation where no guarantee scheme was underpinning the sector.

- NZPA