The Reserve Bank of New Zealand says it asked for CBL Insurance (CBLI) to be put into an interim liquidation after the company paid $55 million to overseas companies, breaching the central bank's orders.
Parent company CBL Corp, an Auckland-based credit surety and financial insurance risk firm, had its stock suspended from the NZX on February 8 amid concerns from NZX Regulation about the information it had given the market, following engagement between it, CBL, the Financial Markets Authority (FMA), the Reserve Bank, and a number of overseas regulators with prudential oversight of CBL's international insurance business.
On February 20, CBL Insurance told the Reserve Bank it was continuing to operate despite being below the minimum regulatory solvency level.
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• CBL Corporation goes into voluntary administration
• CBL chief operating officer quits amidst share suspension
Interim liquidators were appointed by the Auckland High Court last week, and today the Reserve Bank's deputy governor and head of financial stability Geoff Bascand said the payments had been the cause.