by Paul McBeth
Chairman Denis Thorn and chief executive Kerry Finnigan say, in the annual report, the future was very uncertain, and the company was forced to increase its level of provisioning to reflect the deterioration in the property market.
They reiterated debenture stockholders are expected to receive between 85 and 93 cents in the dollar over the five-year moratorium period and that it will not resume payment of dividends to perpetual preference shareholders.
Still, "this position could change depending upon whether further loan provisioning is required or the company is successful in recovering some of the provisioning already allowed for," they said.
Last month, the company posted a full-year loss of $175.7 million for the year ended June 30 after it wrote down some $77.6 million of bad debt and increased overall impairments to $146.5 million.
Auditor KPMG said it was unable to quantify the potential impact of "the future actions of first mortgage holders, in respect of those loans where the company has a second (or lower) ranking charge over the loan security," and this could lead to further loan impairments.
Strategic Finance had written a number of second mortgages on resort, residential and commercial property developments in Auckland, Queenstown and Fiji during the market boom in recent years.
The company froze repayments to 15,000 investors owed $325 million in August last year, before a majority of investors voted in favour of a moratorium in December 2008.
Paul is a staff writer for Good Returns based in Wellington.
| « Geneva pares loss on cost cutting, restructure | South Canterbury agrees to repay US investors » |
Special Offers
© Copyright 1997-2024 Tarawera Publishing Ltd. All Rights Reserved