News Round Up

UPDATED: Nathans Finance falls over, PFS abandons bid for building societies. Comment (+ responses): Commission disclosure back on the agenda.

Monday, August 20th 2007, 6:42AM
Nathans Finance has become the fifth New Zealand finance company to collapse in the last two years after questions about its dealings with its parent company, VTL Group, which has also collapsed, and about VTL's proposal to "sell" its US operations for US$67.5 million ($96.8 million).[READ ON]

PFS abandons bid for CBS
Propertyfinance Group (PFG) has abandoned to join up with two Canterbury-based building societies and sold its shareholdings to another building society.

PFG hit the headlines earlier in the year when it bought stakes in the Canterbury Building Society and Loan and Building Society. However, last week those shares were sold to Auckland-based Southern Cross Building Society.

"It is clear any opportunities between firms could take some time to deliver and therefore after a strategic review of the Company's assets the Board decided that its holdings in CBS and LBS were not core to its main activities and therefore offered the share parcels into the market in a competitive bid process," PFG chairman Barney Sundstrum says.

Southern Cross currently owns 13% of CBS and 9% in LBS. Southern Cross managing director Bob Smith says the shares are a strategic holding for his company.

He expects regulatory changes will create "some consolidation in the building society sector."

"Indeed we understand that both CBS and LBS are already considering a merger of the two Ashburton-based building societies and, as new shareholder in both societies, we support their moves to do so".

Comment (+ responses): Commission disclosure back on the agenda
The age old debate about commissions seems to have raised its head again recently, and this time strongly. [Read more here, including your responses]

Basis Capital may lose 80% of value
The news isn't so good for Basis Capital investors. Reports last week indicated that its Yield Fund may lose more than 80% of its value.

Bloomberg reports that the Australian hedge fund has been unable to "accurately estimate" the net asset value of units in the fund because of "further deterioration of market conditions."

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