20 Aug 2008

Strategic Finance tips $15.5m loss

2:32 pm on 20 August 2008

Strategic Finance says it will record a net loss of $15.5 million for the year to June.

The troubled finance company recently froze redemptions, stopping 15,000 investors from withdrawing a total of $325 million. It says $73 million is left in shareholder funds.

Annual results are to be issued at the end of the month.

Strategic Finance says it has been hit by loan defaults as a result of the economic slowdown, and more defaults are on the cards.

Strategic says it is a disappointing result, but it considers it appropriate to adopt a conservative view in light of the current economic environment.

After making allowances for bad debts and provisions, the company says total shareholder funds are expected to be about $73 million.

Strategic Finance expects to release the full details of its audited results on 29 August.

Meanwhile, another finance company, Geneva Finance, says it is reviewing its loan portfolio because of concerns over its asset quality.

Geneva says the review is expected to take up to four weeks, by which time the board will be ready to advise the market on its profit forecast.