Wrightson Finance profit down, impaired assets up

Net profit fell from $4.7 million to $3.3 million in the six months to December 31 and the company was forced to raise the value of its impaired assets by $6 million to $7.4 million.

Of the company's $551 million loan book, $480 million worth of loans were not impaired or past due date.

Earlier this month the company received a BB credit rating from Standard & Poor's, making it eligible for the government's extended deposit guarantee scheme. If it is accepted into the scheme, it anticipates fees to be about $2 million for the year ended June.

Finance companies and non-bank deposit takers have been scrambling to get their credit ratings before the Reserve Bank's prudential regulations require most lenders outside the banking sector to get rated by S&P, Fitch Ratings, or Moody's Investors Service. Companies need a BB rating or better to qualify for the government's extended deposit guarantee scheme, which will take them through until the end of 2011.