Vestar to put package to its Bridgecorp clients
MFS-owned financial advisory group Vestar is looking to put some proposal to its clients who had money in Bridgecorp to help improve their confidence in the sector.
Thursday, November 1st 2007, 5:11AM
"Compensation is not the correct description," he says. "We don't believe Vestar or any of its advisers have done anything improper."
He says the proposals have to go through a raft of regulatory and legal steps before he can reveal the details. While he would like to be able to put the proposal to investors before Christmas he "can't emphatically say that."
Good Returns is aware of one manager who recently wrote to investors in one of its struggling funds, offering a "three year management fee rebate" if they stayed in the fund for three years.
Maywald says he hadn't heard of this proposal and said Vestar was not planning anything along those lines.
Maywald says the proposal has been worked on for some time and is driven by two things. One is that MFS is determined to build a significant financial services business in New Zealand.
The company has always "looked after the best interests of its clients", he says. This proposed deal is in keeping with that philosophy.
In addition to that, Maywald recognises that investors have lost a lot of confidence in finance companies, financial advisers and the financial sector as a whole.
This proposal is designed to help restore confidence levels. "We are going to do what we can to restore confidence in this sector," he says.
MFS has not publicly stated how much of its clients' money was invested in Bridgecorp, however it is understood to be in the tens of millions of dollars.
Maywald says the Bridgecorp collapse hasn't hurt the business as much as some commentators are suggesting.
"There's no mass exodus of clients," he says.
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