29 Aug 2010

English tight-lipped on Govt role in SCF talks

11:45 am on 29 August 2010

Finance Minister Bill English has again declined to speculate over whether the Government is involved in negotiations to save South Canterbury Finance, which has around $1.9 billion worth of assets.

Mr English told the Q + A programme on TV One on Sunday that up to $900 million was set aside 18 months ago to cover Government guarantees against finance company collapses - but that amount was for the whole sector.

The trustees of South Canterbury Finance have given the company until Tuesday to find new capital and avoid the prospect of receivership.

SCF chief executive Sandy Maier says the company is in talks with about five prospective investors.

Trading in the securities of South Canterbury Finance was halted on the stock exchange on Friday, pending a material announcement from the company.

Earlier this month, Standard Poor's cut the company's long term credit rating from B minus to Double C, and warned further downgrades were possible.

Hubbard supporters seek re-think by PM

Supporters of Timaru businssman Allan Hubbard have written to the Prime Minister, asking him to reconsider the Government's handling of inquiries into the financier's affair.

The Government placed Mr Hubbard and his wife under statutory management on 20 June, along with seven charitable trusts, Aorangi Securities, and later, Hubbard Management Funds.

The Hubbards are also under investigation by the Serious Fraud Office.

Statutory managers Grant Thornton said on Friday that the assets of Hubbard Management Funds were worth only $61 million at the end of March, not $82 million as stated.

The Stand by Hubbard group describes the Government's approach as divisive and unfair and says it has provided no evidence to justify its actions.

It asks John Key to extend the same compassion toward Mr Hubbard that he has to investors over the years.

The supporters say the statutory managers have frozen all interest payments, which some investors rely on to survive.