Bridgecorp gave a company alleged to be its "piggybank" a special deal on its interest rate, far below what the failed finance firm charged other borrowers, a court has heard.
However, former Bridgecorp director Rod Petricevic - on trial for allegedly misleading investors - admitted in the High Court at Auckland today that the interest rate should have been set higher.
Crown lawyer Warren Cathcart's cross-examination of Petricevic centred today on what is known as the "Barcroft transaction".
The transaction involved the sale of loans from Bridgecorp to Barcroft Holdings on June 30, 2006 and represented Bridgecorp's single biggest exposure.
The amount Barcroft owed Bridgecorp was originally around $80 million but grew to more than $100 million before the latter company collapsed, owing 14,500 investors $459 million.