NZ Finance gets more funding
New Zealand Finance has secured two significant lending facilities, one from ASB's parent, Commonwealth Bank of Australia (CBA), and the other from Westpac.
Wednesday, December 12th 2007, 3:01PM
The CBA funding is a new finance facility of $40 million, while the Westpac one is a $50 million increase to an existing warehouse line.That line now sits at $250 million and is in the name of NZF Mortgages.
NZ Finance managing director John Callaghan says support from two major banks, at a time when there is uncertainty around finance companies, "shows the strength of our loan book and the confidence they have in our management team and the governance.
"These facilities give NZ Finance more liquidity as debenture flows are affected by a lack of confidence in the industry as more finance companies fail."
Callaghan says the fund means NZ Finance can continue to grow and take advantage of lending opportunities which other companies are unable to fund.
The CBA funding line ranks equally with debenture holders. The interest rate NZ Finance has to pay CBA is slightly less than New Zealand Finance pays to its debenture holders.
"This new credit line, coupled with cash reserves, means that NZ Finance has one of the strongest liquidity profiles for any finance company in New Zealand," NZ Finance chairman Richard Waddel says.
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