Rates round-up: August 13

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Heartland banks on registration; Trustpower sets rates on bonds; NZF wins court changes to freezing orders.

Monday, August 13th 2012, 6:17AM

by Niko Kloeten

Heartland updates on bank registration

Heartland expects to know by November whether its application for a banking licence has been successful, it said in a recent announcement to the NZX.

"The application process continues to be progressed," it said.

"Certain necessary intermediate steps (including the provision of certain independent reports, and the formal written application, to the RBNZ) have been completed, and RBNZ has confirmed that the formal determination process has now begun."

However, it said the timing of the decision "remains uncertain, and the outcome remains unknown. If the RBNZ declines the application there is no appeal process available, although a further application may be considered in the future.

"Any view the Board of Heartland may have as to whether HBS satisfies the published RBNZ criteria for bank registration is speculative."

Heartland was formed when Marac merged with the Canterbury and Southern Cross Building Societies.

Trustpower sets interest rate on bonds

Listed electricity retailer TrustPower has opened its offer of unsecured, subordinated, fixed rate bonds and set the interest rate at 6.75%.

TrustPower is looking to raise up to $200 million from the issue, which includes a general offer to members of the public of up to $75 million with the option to accept up to an additional $50 million of oversubscriptions.

It also has an exchange offer of up to $75 million to New Zealand resident holders of TrustPower bonds maturing in September.

"TrustPower advises that the offer has been very well received by market participants and investors, and that $72.5 million of Bonds under the General Offer have been reserved by TrustPower for clients of market participants under firm allocations," it said in an NZX announcement.

"A further $2.5 million of Bonds will be available to members of the public under the General Offer on a first come, first served basis. Due to the high level of demand, a cap of $25,000 per application will be applied by TrustPower for such applications."

NZF gets changes to freezing order

Listed financial services firm NZF Group has been granted some changes to the freezing order placed on it in April at the request of KordaMentha, the receiver of its subsidiary NZF Money.

At a High Court hearing in July NZF sought approval to pay certain business expenses that had been incurred which the receiver had refused.

In a judgment released this week, Justice Rodney Hansen held that the expenses had been properly incurred and directed payment of these expenses.

He refused KordaMentha's application to vary the freezing order to prevent any further dissipation of the cash reserves of NZF Group, while letting NZF have the freezing order varied to allow access to its cash reserves without seeking the receiver's consent.

Justice Hansen ordered that expenditure on permitted expenses from the cash reserves can continue but ordered that a minimum cap of $1.3 million must remain in cash reserves.

He also noted the significant level of costs being incurred by NZF Group in order to defend the receiver's proceeding.

Niko Kloeten can be contacted at niko@goodreturns.co.nz

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