Rates Round Up

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S&P happy to be approved rater; PGG Wrightson Finance continues to grow; PIR sold.

Sunday, March 22nd 2009, 3:29PM

Standard & Poor has, not surprisingly, welcomed the news that it will be one of the Reserve Bank’s approved ratings agencies for the non-bank sector.

S&P managing director John Bailey says the company is committed to helping “improve financial literacy concerning the meaning and utility of credit ratings in the context of the NBDT sector.”

“Credit ratings are one of several tools that investors can use when making decisions about purchasing bonds and other fixed income investments. Credit ratings are opinions about relative credit risk, but it is important to emphasise that they are not investment advice, or buy, hold, or sell recommendations.”

The company's loan book grew by 14% from a year earlier, to $513 Million, partly as other rural financiers appeared more reticent about lending in the prevailing economic climate.

The growth in assets saw core net interest income increase 34%, from $6.94 million to $9.30 million. Including IFRS adjustments of $0.96 million, net profit after tax (NPAT) increased by $2.09 million to $4.65 million.

At December 31 the secured portion of the book was 97.9% - with first land mortgages totalling 74.4% and second land mortgages of 6.4%.

During the period the company raised $100 million through a bond issue and over the year it pulled in $90 million through debentures.

Reinvestment rates in the debentures sits at around 80%.

PIR sold
Australian-based research company Property Investment Research (PIR) which provided information on some of New Zealand’s failed finance companies has been sold.

Fellow researcher Aegis Equities Research has bought the company but will continue to run it as a separate business.

PIR provides research on both listed and unlisted property trusts and other property-based investment schemes.

PIR founder and managing director Richard Cruickshank will continue to be involved in the business.

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