Provincial Finance bailout bill likely to swell

The $27.5 million bill for bailing out stricken Provincial Finance may grow even further, the firm's trustee says.

Several finance industry players, led by South Canterbury Finance, are seeking to raise $11 million to add to the $16.5 million Provincial Finance chairman David Lyall and managing director John Edilson have pledged to inject to recapitalise the business.

However, Perpetual Trust chief executive Peter Baynes said yesterday that the sum needed to lift the company out of receivership would depend on a valuation of subsidiary Tasman Pacific Insurance.

If the company's value fell short, more cash would be needed.

Perpetual Trust placed the company into receivership on Friday, saying that was the best way to protect the interests of the debenture stock holders, who had invested $300 million with Provincial.