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SCF repays US$50m to investors

Torchlight Credit Fund, part of Pyne Gould Corp.'s Perpetual Asset Management unit, has come to the aid of South Canterbury Finance by pulling together a group of investors to provide a $75 million funding line.

Thursday, October 29th 2009, 1:35PM

The funds have been drawn down to repay US$50 million of South Canterbury's US$100 million private placement facility, whose investors had the right to demand repayment when the finance company lost its investment grade credit rating. The remaining US$50 million is to be repaid over five months.

The transaction fits with part of Perpetual's strategy of taking on investments deemed too risky for traditional lenders but which offer the prospect of high returns for sophisticated investors willing to take a longer-term view. Forsyth Barr arranged the new facility.

"Investments that are perceived to be too difficult for banks often create opportunities for fund managers," said George Kerr, Perpetual's chairman and a major shareholder in Pyne Gould. "The fund has been established to focus on exactly this type of situation."

Perpetual is in the process of taking impaired loans off the books of Marac, the Pyne Gould finance arm that it aims to transform into a bank. Perpetual's chief executive John Duncan has said Torchlight may grow into a fund of about $500 million.

Standard & Poors cut South Canterbury's credit rating to BB+ in August - a speculative, or junk rating, citing the firm's exposure to riskier investments. The downgade triggered an "event of review" for its banking facility and the US private placement funding.

South Canterbury chairman Allan Hubbard said he is "pleased to have this new facility provided by investors who understand the business cycle and the opportunities for South Canterbury.""We are continuing to progress our own restructuring plans and will make further announcements when we are able to," he said.

South Canterbury is receiving "a good response" from investors to its prospectus for securities and deposits offering yields of up to 8.5%, he said.

(Businesswire)

« South Canterbury Finance will seek govt guarantee extensionSCF appoints three new directors »

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AIA - Back My Build 4.94 - - -
AIA - Go Home Loans 7.49 ▼5.79 ▼5.49 ▼5.59
ANZ 7.39 6.39 6.19 6.19
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 5.79 5.59 5.59
ASB Bank 7.39 ▼5.79 ▼5.49 ▼5.59
ASB Better Homes Top Up - - - 1.00
Avanti Finance ▼7.90 - - -
Basecorp Finance ▼8.35 - - -
BNZ - Classic - 5.99 5.69 5.69
Lender Flt 1yr 2yr 3yr
BNZ - Mortgage One 7.54 - - -
BNZ - Rapid Repay 7.54 - - -
BNZ - Std 7.44 ▼5.79 ▼5.59 5.69
BNZ - TotalMoney 7.54 - - -
CFML 321 Loans 6.20 - - -
CFML Home Loans 6.45 - - -
CFML Prime Loans 8.25 - - -
CFML Standard Loans 9.20 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 5.69 - -
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Co-operative Bank - Owner Occ 6.95 5.79 5.59 5.69
Co-operative Bank - Standard 6.95 6.29 6.09 6.19
Credit Union Auckland 7.70 - - -
First Credit Union Special - ▼5.99 ▼5.89 -
First Credit Union Standard ▼7.69 ▼6.69 ▼6.39 -
Heartland Bank - Online 6.99 ▼5.49 ▼5.39 ▼5.45
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.60 6.65 6.40 -
ICBC 7.49 ▼5.79 ▼5.59 5.59
Kainga Ora 8.39 7.05 6.59 6.49
Kainga Ora - First Home Buyer Special - - - -
Lender Flt 1yr 2yr 3yr
Kiwibank 7.25 6.89 6.59 6.49
Kiwibank - Offset 7.25 - - -
Kiwibank Special 7.25 5.99 5.69 5.69
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 7.94 ▼5.75 ▼5.99 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank 7.49 6.95 6.29 6.29
SBS Bank Special - 6.15 5.69 5.69
SBS Construction lending for FHB - - - -
Lender Flt 1yr 2yr 3yr
SBS FirstHome Combo 4.94 5.15 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.75 - - -
TSB Bank 8.19 6.49 ▼6.39 ▼6.39
TSB Special 7.39 5.69 ▼5.59 ▼5.59
Unity 7.64 ▼5.79 ▼5.55 -
Unity First Home Buyer special - 5.49 - -
Wairarapa Building Society ▼7.70 ▼5.95 ▼5.75 -
Westpac 7.39 6.39 6.09 6.19
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Westpac Special - 5.79 5.49 5.59
Median 7.49 5.97 5.75 5.69

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