About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Wednesday, September 18th, 6:55PM
rss
Latest Headlines

Grosvenor takes icing off fund

Grosvenor has split its Enhanced Income Fund (EIF) in two, shunting off about 80% of the liquid underlying investments to the new PIE-compliant Income Securities Portfolio.

Wednesday, August 20th 2008, 6:45AM

by David Chaplin

According to a letter sent to Grosvenor investors, the move became necessary after about 15% of underlying EIF investments were either frozen by issuers or placed in receivership.

In particular, the closure last month of the Canterbury Mortgage Trust - which comprised 10% of EIF holdings - prompted Grosvenor's decision to split the fund. As well, the EIF holds investments in Dominion Finance, Strategic Finance and Capital + Merchant, which collectively make up about 5% of the portfolio.

"While only a small number of these securities were held in the EIF, it was not appropriate to keep the fund open to new investments given the uncertainties surrounding valuations and liquidity issues for those 'impaired" assets'," the Grosvenor letter says. "Importantly, although the EIF has been closed to new investments since August 2007, it has continued to allow withdrawals as requested by investors throughout this period."

As well as the damaged assets, Grosvenor has also left investments in Marac, South Canterbury Finance and the Auckland Mortgage Trust in the EIF with redemptions in these products either underway or pending.

In total, 19% of funds have stayed inside the EIF with the remainder placed in the Income Securities Portfolio (ISP).

Allan Yeo, Grosvenor CEO, said the EIF would eventually be wound up as the underlying investments pay out.

According to the Grosvenor letter, the wind-down could take "two to three years" but the majority of the EIF funds should be paid out by March next year.

Yeo said neither Grosvenor nor the group's associated financial advisers would collect fees on the frozen EIF investments.

"We don't think you should charge fees on frozen funds," he said.

The Grosvenor letter says the ISP, which promised a daily compounded earning rate of 8.5%, will "have no exposure to illiquid finance company debentures or unlisted mortgage trusts".

"Plans are also under way to offer a term investment option for the ISP which will provide a higher rate than this 'on call' rate – this is expected to be available in September," the letter says.

« Adviser groups come together as oneSovereign takes regulation bull by the horns »

Special Offers

Commenting is closed

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Weekly Wrap

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.15 4.09 4.49
ANZ Special - 3.65 3.59 3.99
ASB Bank 5.20 4.15 4.09 4.39
ASB Bank Special - 3.65 3.59 3.89
BNZ - Classic - 3.65 ▼3.54 3.99
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.19 3.19 3.19
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 5.95 - - -
Credit Union Baywide 6.15 4.95 4.95 -
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 - - -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
Housing NZ Corp 5.19 ▼4.15 ▼4.09 ▼4.39
HSBC Premier 5.24 3.35 3.35 3.35
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 5.65 3.85 3.95 3.89
Kiwibank 5.80 4.30 4.34 4.74
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.55 3.59 3.99
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.69 4.79 -
Resimac 5.30 4.86 4.14 4.19
Lender Flt 1yr 2yr 3yr
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - 3.69 3.69 3.99
Sovereign 5.30 4.15 4.29 4.55
Sovereign Special - 3.65 3.75 4.05
The Co-operative Bank - Owner Occ 5.15 3.65 3.59 3.99
The Co-operative Bank - Standard 5.15 4.15 4.09 4.49
TSB Bank 6.09 4.65 4.59 4.85
TSB Special 5.29 3.85 3.79 4.05
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Lender Flt 1yr 2yr 3yr
Westpac - Offset 5.34 - - -
Westpac Special - 3.65 3.59 3.99
Median 5.35 4.15 4.09 4.19

Last updated: 16 September 2019 10:03am

News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%

MORE QUIZZES »

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by Web Developer and eyelovedesign.com