Are you suggesting NZF was the seller?
Printable View
No, this story may be of interest because it demonstrates:
1) There is a market for RMBS; and
2) GE Money is no longer a domestic competitor
If NZF do announce a solution to the NZF Money retail debenture funding issues, through the new partnership; there does a appear to be a market in packaged mortgages.
3 ¢
(nzd) 0.7 30.4%
27/05 10:31 nzt
3 2.4 5 3 3 3 10,095 $303
NZF Final Year Result to March 2011
http://www.nzx.com/markets/NZSX/NZF/...al-Result-2011
Declared loss of $4.767 million - suppose this is in line with the NZF Money impairments (signalled to be about $4m) and the Finance Direct loss on sale (revealed as about $1m).
Haven't reviewed the numbers, yet ...
Oh, so they are lending then!
NZF limiting new loans to $750,000
NZF Group is limiting new loans made by its troubled property finance group to a maximum $750,000,
Friday, June 3rd 2011, 7:29AM
by Jenny Ruth
"This should ensure that significant loan impairment allowance movements and bad debt costs are restricted in future and ultimately result in NZF's property finance division returning to profitability," says chief executive Mark Thornton.
The division's $5.1 million in loan impairment and bad debt costs resulted in NZF Group reporting a $4.8 million net loss for the year ended March.
"NZF's experienced lending team continues to work with all of its borrowers to achieve recovery of all outstanding loans. Whilst there are still a couple of large property finance exposures that remain within NZF's loan portfolio, we believe that we have been prudent with our loan impairment allowance calculations," Thornton says.
NZF's home loans division's pre-tax profit fell 39.4% to $2.5 million in the year and Thornton says that was mainly due to changes in the Reserve Bank's official cash rate impacting the value of interest rate swap contracts and higher funding costs of its $100 million in securitised mortgages than the Westpac warehouse facility. The $84.6 million in secured notes on NZF's balance sheet relate to that securitisation last year which was the first in New Zealand since late 2007.
NZF's financial services distribution operations, which include 50% of the Mike Pero Mortgages broking business, saw pre-tax profit before last year's goodwill write-down fall to $187,000 from $421,000.
Thornton says the main factors include the slow housing market and mortgage lending in generally, a reduction in income generated from the Huljich wealth management Kiwisaver scheme and set-up costs connected with Mike Pero Real Estate which will start to generate income in 2012.
Thornton didn't answer a question on whether NZF is making progress on its efforts to bring in new equity.
Bit hard to lend to much when you only have $5M in cash according to the accounts, still no update on potential partner no surprise there! I could have answered the question for Me Thornton - there is no partner willing to do a deal with us where we are not getting completely scewed over.....
Pretty poor result on the back of last years poor result, Pero's only marginally profitable, huge w/off for Finance Direct and confessions of other large property finance exposures. They need to recognise the mistakes made by their "experienced lending team". Equity won't last much longer at these loss rates.
TTG, hopefully this will put a smile on your face!!
NZF
03/06/2011 13:37
GENERAL
REL: 1337 HRS NZF Group Limited
GENERAL: NZF: NZF Group Limited (NZF) - Continuous Disclosure
The Directors of NZF Group Limited are pleased to announce that the due
diligence process with potential business partners has reached a stage where
we are now confident of a successful outcome. As a consequence, the Home
Loans Division will resume origination activities under its committed Westpac
Warehouse Facility. Origination activities were suspended earlier this year
when negotiations with new business partners commenced. Westpac has been
privy to these negotiations and have agreed to renew the current Warehouse
Facility of $225 million until 18 October 2012 on similar terms and
conditions.
ENDS
End CA:00209873 For:NZF Type:GENERAL Time:2011-06-03 13:37:51
Yes I get the Direct Broking emails to....
I still think they will get srewed over in light of their financial performance over the last few years and all the others issues around S&P. The devil will be in the detail.....
NZF promised to donate 0.25% of the deposits received by May 31 to Red Cross to help Christchurch rebuilding. It has not revealed the amount of donation. Does it suggest little new deposits thus little money to donate?
Would new shares be issued to the new business partner(s) at current share price 2-3 cents? If so, those who converted notes to shares would be a losser.
Interesting, since the good news where has all the gossip gone?
We know that:
1) The long term lending part of the business will be partially sold down to the new partner who will take a majority stake.
2) The identity of the new partner is unknown - the contenders are: Liberty Financial, Resimac, Members Equity Bank, Firstmac and AMP Bank. Resimac is my pick based on NZ Herald reporting. (Liberty is an existing partner in the Pero unit; Resimac has an interest in Allied Farmers).
3) There are extreme growth prospects in the non-bank residential mortgage market. Total market in NZ is about $171b with about $4b in non-bank entities. NZF currently only has about 4% of this non-bank portion of the market.
4) Competition in the mortgage market is vital, once the OCR starts to rise. The Australian government clearly understands the need to support non-bank entities:
http://www.theaustralian.com.au/busi...-1225828937193
Benefits to NZF:Quote:
Originally Posted by TheAustralian
A) The Aussies clearly see vast growth prospects in long term mortgage lending, in the non-bank sector, in NZ. I agree with them ... there are SPECTACULAR growth prospects
B) Equity released from the NZF long lending unit will allow the short lending unit to be refloated. There are SPECTACULAR growth prospects in returning to this market
C) The Pero financial services distribution and real estate initiatives will be very valuable drivers of this SPECTACULAR lending growth
NZF market capitalisation is at about $3.5m. The current financial year should be the "bounce back". I expect we will gain a clear picture of the growth prospects by year end - given the collapsed state of competitors and the importance of giving the banks a competitive run - I am now expecting this growth rate to be SPECTACULAR.
Lets not be picky Alan, the company has at least turned the corner for the better and if the new partner is Resmac, I think we will see something spectacular.
http://www.resimac.com.au/
The only "Spectacular" thing I have seen so far is a Spectular tumble of the share price and share holder value....
I don't share your optimism Enumerate, their lending team has made some big mistakes which they will remain paying for some time and there is more to come out of the wood work. It will be interesting to see how S&P intepret this move with Resi. Also I think the Pero unit is in a bit of a mess and only barely profitable, only time will tell if the Real Estate venture will make any difference I certainly wouldn't think so in the short term. All the hype seems to have died down with this venture, the only thing they would have seen so far is marketing expeses and no income - not surprising as this was terribly timed in my opinion.
Weren't Resimac the guys who came to the aid of Allied Finance ..... with an intent to invest which kept the bankers et all off Allied backs for a few months ..... and conveniently allow the Hangover thing to go through .......... until the 'intent' was found only to be that .... and the 'investment' never went ahead .... I think thats how it all worked out
Many said it was a deal that was never going to happen (consumated) but it sounded good at the time
I can't understand why they were interested in Allied - it was very far from their core lending profile. Maybe they were searching for a vehicle to do non-bank mortgage lending, in NZ?
Investment is all about the future ... dwelling on the past is useful, to a degree; but what really matters is the market and the ability of a company to respond to the market.Quote:
Originally Posted by Tony Two Gloves
I think market prospects are ... SPECTACULAR and given NZF Group has done very well to survive when retail debenture liquidity has evaporated I think there is cause for some optimism that the NZF Group response to the market will be SPECTACULAR.
This recovery is not going to take weeks. We do not even have ink on the partnership deal, yet. Give it a year to gauge progress and expect significant results in about two years. Hopefully we will have a long period of economic growth ahead of us.
2011 Annual Report to March is out:
http://www.nzx.com/markets/NZSX/NZF/...-Annual-Report
There should be! Their loan book is becoming an issue as S&P well know, the optimism in this company was poorly formed and their cash has almost gone. I would certainly be concerned if I had funds due shortly.......
The news today won't help get the deal over the line, pulling the Prospectus is the worst look possible IMHO.
Now they tell us they voluntarily withdrew the prospectus on Monday 18 July. Hmm - no market disclosure on that trivial development. So what was in those discussions with the FMA?
Further good news.....NOT. The death spiral is back!!
NZF
22/07/2011 09:28
CREDIT
REL: 0928 HRS NZF Group Limited
CREDIT: NZF: NZF Group Limited (NZF) - Continuous Disclosure
Further to our market announcements made earlier today, NZF advises that the
long-term issuer credit rating assigned to its wholly owned subsidiary
company, NZF Money Limited (NZFML), has been lowered one notch from"CCC-" to
"CC" by International Credit Rating Agency Standard & Poor's(S&P).
A copy of S&P's Research Update is attached to this Market Announcement,
which indicates that S&P will lower the issuer credit ratings assigned to
NZFML to "D" if the company fails to meet any of its creditorobligations
next week.
If Directors don't move, I'm sure the Trustee will - dark thoughts prevailing .......
Looks like they are disclosing as they go, apart from the time lag on the Prospectus withdrawal - obviously tyring to avoid community service or worse in the future....
Hey Mini is it just me and you in here, all the positive (blinded / stupid) people seem to have disappeared..... After reading numerous articles it looks like the FMA made them withdraw the Prospectus over poor disclosure of assset quality and liquidity issues, not all this BS that NZF voluntarily withdrew because of a defaulting borrower. In my opinion they have been holding on by a thread for well over a year and all the nay sayers that S&P were over reacting were wrong - they weren't and next week they will more than likely default and be given a "D".
I have never been able to understand the positivity some people have had for NZF, you canot keep losing 4 - 5 mil a year and keep harping on about your experienced lending team, Pero's is making no money and in reality is another broken model just like their consumer finance arm which they took a bath on. They do not have a viable business. The final straw for me was when Huljich resigned from the board, that was the day that the last remnants of hope disappeared!
Enumerate - is thsi spectacular enough for you?
NZF
22/07/2011 13:13
GENERAL
REL: 1313 HRS NZF Group Limited
GENERAL: NZF: NZF Group Limited (NZF) - Continuous Disclosure
NZF today advises that the Board of its subsidiary company, NZF Money Limited (NZFML), have explored various options for a short-term funding solution.
After giving the matter considerable thought and taking into consideration developments over the last couple of days, the Board of NZFML do not believe
that such a short-term solution is in the best interests of NZFML or its investors.
Accordingly, the Board of NZFML have requested NZFML's Trustee, Covenant Trustee Company Limited, to appoint a receiver. Further announcements will
be made in due course.
And that would appear to be that, took a long time but looks like our opinions were vindicated - or does Invessi still see a light at the end of the tunnel??
I remain saddened by the lack of insight investors show in their decision making. Often we don't need protecting from rogues in the market - we need protecting from ourselves. So often we see, not rational investment decisions but gambling. In itself I have no problem with this - people are free to loose their own money as they see fit. But I despair when it is dressed up as "investment". And what really gets to me is that we won't learn from our past mistakes. We'll continue to get taken in by those who are able to spin a semi credible yarn. I just can't figure out why people insist on throwing good money after bad when the warning signs seem so self evident to me. At least with NZF I'm not having to pick the pieces up for others like I've had to do with Hanover, ALF and SCF.
Hey TTG, give me some credit - I've been smeared for my negativity and crystal clear insight too you know ;);)Quote:
Hey Mini is it just me and you in here, all the positive (blinded / stupid) people seem to have disappeared
FMA is performing well so far.....lots more ground to cover but a good start
I agree, people tend to be unable to distinguish between fact and fiction. The facts with NZF are consistent chunky losses, broken business models & liquidity issues - all these were summed up by S&P a few months back but still people kept insisting this was an over reaction and the company itself stated this. I tend to rely on the financial results which with NZF speak for themselves over the last few years and pay very little attention to the comments of directors, as they are the major shareholders of course they do want to see this thing fail. We have all seen the spectacular share price colapses and very few come back from that (exception Diligent) a $1.60 odd to 0.035 cents is a SPECTACULAR loss of value and if you purchased shares after the S&P downgrade Mini is right - there are much better odds at the casino!!
Sorry Xerof - you were on the money with that Trustee call. Again I like the way NZF said it had contacted it's Trustee....I think the Trustee (if awake) would have been pounding on NZF's door for the last few days. The NZF spin doctors could make Osama look like a well balanced chap who is mostly mis understood....
Of course they don't want their company to fail - but we should also look at director remuneration. Callaghan got paid around $200k, Thornton $184k and Croad $134k. Generally I don't have too much of a problem with Director remuneration - providing they are adding value to the strategic direction of their company and looking after the governance issues. So often I can't help but feel Directors are directors because of the cash flow from wages. And that's putting aside issues like related part lending
The fact that the new "partner" in Home Loans probably understood how critical the situation in NZF Money was and still reneged on the "done deal" is the seat of the problem.
The fact that a "partner" does this probably foreshadows further negative impacts.
What a bizarre thing to say, surely they must have received some advice / recomendation for presumably those horrible notes? I remember seeing a comment from Callaghan in one of the Sunday papers saying he couldn't understand why the notes where trading at such a discount and he would be as many as he could if he was allowed to. Well maybe the question has now been answered. I don't think Croad was ever a directof of NZF - just that brilliant investment Finance Direct.
What new partner, what doen deal.?
I read teh following
and the key bits for me were "potential business partners" and "confident of a successful outcome" Have I missed the announcement of the new partner and the announcement that the outcome was actually successful?Quote:
NZF
03/06/2011 13:37
GENERAL
REL: 1337 HRS NZF Group Limited
GENERAL: NZF: NZF Group Limited (NZF) - Continuous Disclosure
The Directors of NZF Group Limited are pleased to announce that the due
diligence process with potential business partners has reached a stage where
we are now confident of a successful outcome. As a consequence, the Home
Loans Division will resume origination activities under its committed Westpac
Warehouse Facility. Origination activities were suspended earlier this year
when negotiations with new business partners commenced. Westpac has been
privy to these negotiations and have agreed to renew the current Warehouse
Facility of $225 million until 18 October 2012 on similar terms and
conditions.
ENDS
End CA:00209873 For:NZF Type:GENERAL Time:2011-06-03 13:37:51
I wonder what levels of guarantees etc (if any) NZF has provided to its Finance Subsidiary that may now be called up by the Receivers? Potentially, this could be the end for NZF as a whole...
The prognosis is unlikely to be good. But then again it hasn't been for a very very long time. At the moment your shares are worthless as there are no "buy" bids. So its time to think about your exit strategy. Do you accept the next bid offer that is raised, no matter what loss you're going to take. Or do you reread Enumerates analysis and hold on for that spectacular change.
Buckles, maybe this will help to answer your question!
NZF
25/07/2011 12:21
GENERAL
REL: 1221 HRS NZF Group Limited
GENERAL: NZF: NZF Group Limited (NZF) - Continuous Disclosure
Further to recent market announcements, NZF today advises that Brendon James
Gibson and Grant Robert Graham of KordaMentha, Chartered Accountants, have
been appointed jointly and severally to be receivers and managers of the
property charged under the Debenture Stock Trust Deed dated 21 October 1999
between NZF Money Limited (NZFML) and Covenant Trustee Company Limited, as
Trustee for secured debenture stockholders.
The Board, management and staff of NZFML are fully co-operating and providing
assistance to KordaMentha, Chartered Accountants, in order to enable them to
carry out their duties effectively as receivers of NZFML. Investors
requiring further information concerning the status of their investments are
directed to the KordaMentha website www.kordamentha.com, who can also be
contacted at the following address:
KordaMentha (NZ)
Level 16, Tower Centre,
45 Queen Street
Auckland 1010
New Zealand
PO Box 982
Auckland 1140
New Zealand
Tel: +64 9 307 7865
Fax: +64 9 377 7794
Email: nz@kordamentha.com
The Board of NZF is currently considering the financial impact that the
receivership of NZFML has on the operations of the NZF Group of Companies. A
further announcement will be made regarding this in due course.
In the meantime, the Board of NZF would like to reassure NZF's shareholders
and its Homeloan mortgage customers and broker channel, that the receivership
of NZFML has no direct impact on the operations of NZF's profitable Homeloans
Division.
In addition, the Board of NZF would like to reassure NZF's shareholders that
the receivership of NZFML also has no direct impact on NZF's 50% strategic
investment in MPMH Limited (Mike Pero Mortgages).
ENDS
End CA:00211611 For:NZF Type:GENERAL Time:2011-07-25 12:21:46
go to www.nzf.co.nz and click on the "investors" tab. It takes you to the Korda Mentha website. If that fill shareholders with confidence, good on ya!
If you read teh Annul a report ot says"On 10 June 2011, NZF Group limited entered into exclusive due diligence with an Australian private company over a staged period. It is expected that the party will support the home loan activities. the Australian partner which will have a majority stake in NZF’s home loan division and is vastly experienced in the Australian RmBS market and will add significantly to the current operations of this division." What do you reckon the chances of that deal going ahead?
We should know that this week, I would say that the chances of it happening are still quite good, there are advantages to both parties for this to happen and if Westpac are still supporting it, and I see no reason why not, (because NZF have proven to them that they are good operators in this space) it should be a win win for all three entities. They have been flagging for some time as have S&P that the finance company had past due and liquidity problems and I think NZF were driven to try and keep the finance company going out of a sense of public image and the interests of the company and the investors, NZF still have a fair chunk of their own equity in the finance company and it remains to be seen what they might get back. I think they have a chance to repay all investors and get cash out for themselves because it has already been flagged that they will be cooperating and working closely with the receivers, this should produce the best possible outcome and take the heat off the group!
Minimoke, notice issued yesterday by NZF to originators, hope it makes you and TTG feel a bit better!
By now many of you would have caught up with our recent news and market announcements that NZF Money Limited has gone into receivership.
Your clients Home Loan is with NZF Mortgages Limited and the service provider being NZF HomeLoans Limited. This part of the business is as they say “Business as Usual”.
Our home loans lending operations and funding facilities with Westpac Institutional Banking all remain in place and are unaffected by this development.
Further to our NZX market announcement of 10 June 2011, we continue to work with an Australian private company and remain confident that we can form a joint venture focused on Home Loan activities in the near future. As apart of this process, discussion has already begun around the introduction of a new brand name which will be announced in due course.
In the meantime, I have attached a copy of a letter that we will be forwarding to your clients.
So for now – It’s Business as Usual.
Minimoke, (and TTG) don't you think a bit of good faith is in order.......
NZF home loan deal still on: Thornton
NZF Group's deal with the unnamed Australian private company which is expected to take a majority stake in NZF's home loans division should still proceed despite the group's subsidiary NZF Money going into receivership last week, says chief executive Mark Thornton.
Tuesday, July 26th 2011, 3:00PM
by Jenny Ruth
"As late as today (Tuesday), we have confirmation that the proposed transaction with the Australian investor should take place as that business is not linked to NZF Money," Thornton says.
"The receivership does not have any effect on the rest of the group apart from some brand damage I suspect," he says.
NZF continues to own its home loans division and 50% of the Mike Pero Mortgages franchise group, both of which are profitable.
Managing NZF Money "has been a very big challenge since the massive run off in debentures leading up to the expiry of the government guarantee last October," Thornton says.
Since then, the company had been very reliant on loan repayments to meet maturing debentures "which, of course, were not assisted by negative downgrades from S&P (international ratings agency Standard & Poor's)."
S&P rightly pointed to NZF Money's low reinvestment rates but that “to a degree became self fulfilling,” he says.
Heading into receivership, NZF Money owed debenture holders about $18 million. That's a long way from the $63.8 million it owed debenture holders at March 31, 2010.
The finance company's last prospectus update on June 30 also showed it still had equity of $10 million, although past due loans were $19 million.
Thornton says it's too early to comment on the likely return to debenture holders but that the $19 million in loans were deliberately allowed to become past due so NZF Money could be in a position to force repayment.
Does anyone see the noteholders getting anything back?
I would think so, NZF are prudent lenders and I would expect they will recover most of their past due loans over time, if the relationship with the receivers remains friendly and the receiver see's value in having NXF handle the loans recovery, that will also help matters and don't forget that NZF have $10m of their own equity in NZFM. I recall that when Cleggs Finance went into receivership, Brian Clegg was retained by the reciever to recover loans and this produced a good result for the debenture holders.
Time to give those rose tinted glasses of yours a clean Invessi, how in any shape can you put a positive spin on this?
Buckles - the shares are worthless as they have been for most of this year, there is a buyer at 0.07 which looks a fair offer - who is going to go first. I can't see how Westpac will continue to support NZF after this fiasco. NZF keep going on about their lending team, what a joke they were doing deals nobody else would touch because of the juicy fee's - what a mistake. They now say we let the loans go into arrears..... were they telling customers not to pay? What a load of garbage, everyone needs to stop listening to NZF press releases and work off the facts provided by S&P and their annual report. As to the value of the Pero brand, $5 million - give me a break, this unit wasn't even profitable after fleecing all those poor franchisee's a value of $5 million is beyond absurd.
QOH - I wouldn't rely to much on that advice, the only saving grace is that you will rank ahead of shareholders if the group fails. They have not been prudent lenders - how can you say that Invessi? The receivers job will be to maximise returns for the debenture holders, I would doubt they well let NZF Group handle this, I believe most of their staff have been made redundant now anyway. If they make the call to fire sale the security properties or loan book than this will get ugly and the return to debenture holders will be not be close to 100%. As for NZF's $10M of equity you must remember this was not their idea it was forced upon them by FMA & Covenant, the equity will be of no concern for the receivers. In my opinion NZF Group should give serious consideration to de listing as I can see no reason why they would continue with the compliance costs when there is vitually no benefit to them - their brand, credibility and integrity have all been destroyed!
Nasty rumour of 45 - 60 cents in the dollar floating around - anyone heard anything concrete?
Haha I bet you would QOH. The 45 - 60 cents in the dollar would be the amount the secured debenture holders would get back for every dollar they invested in Debenture Stock with NZF Money. I think you hold the NZF Notes which are not effected by the receivership of NZF Money apart from the very bad look this has for the group. This is obviously comes through to the current pricing on the notes which is a significant discount to the $1 value they originally had.
If you are a NZF020 holder - the security for your Capital Notes is held by NZF Group. This entity owns investments in NZF Homeloans, Mike Pero Holdings, NZF Money and formerly Finance Direct.Quote:
Originally Posted by QOH
Finance Direct has been sold and NZF Money has slipped into receivership.
The largest units of the group - Homeloans and Mike Pero are still trading and should still be profitable.
We are all waiting for a status update on the selldown of a majority stake in the NZF Homeloans unit. The money released in this sale was intended to be applied to cover debenture payouts in NZF Money - the lack of completion of this sale compromised the NZF Money repayments - hence, receivership for this unit.
So, the bottom line is that interest on your NZF020 is still due and it is probable that it will be paid (due to the cashflows from Homeloans).
However, we are all expecting some further announcement on the viability of the group following the loss of the NZF Money unit.
If you want to review the various statutory reports, as they fall due, you can inspect the following link:
http://www.business.govt.nz/companie...DNZF%2520Money
NZF back in business
Friday, September 9th 2011, 6:40AM
Non-bank lender NZF Home Loans has rolled out home loan rates for new business it receives. The rates are for its varible. six month and one year terms and there are different rates for various LVR levels. It says the rates are only for new business Introduced to NZF HomeLoans, no pre approvals are accepted and the LMI is payable by the borrower where LVR is greater than 80%. The LMI can be capitalised to a maximum LVR of 95%.
I am sure they would want to be involved after this article - incompetence springs to mind, but this is positive right Invessi?? I think it would be safe to say NZF Groups equity in this has GOOOOONE
Debenture holders in failed lender NZF Money face a likely shortfall as the receivers expect to write down the value of loans on its books.
Receivers Grant Graham and Brendon Gibson of KordaMentha expect to make a "material" impairment to the $28.3 million loan book, which will probably lead to a shortfall for debenture holders owed some $16.4 million.
Unsecured creditors owed $115,000 will probably go away empty-handed, they said in their first report.
"We are continuing to review the loan book and have commenced the process of collection of outstanding loans," the report said.
"We note however that several loans of significant size have already been subject to previous restructuring, and in many cases valuations for security properties are well out date.
These factors, logically give rise to concerns that there will be a material level of impairment in the loan book."
NZF Money, the deposit-taking subsidiary of NZF Group, was put in receivership in July after its parent failed to secure short-term funding needed to keep the finance company afloat.
The shortfall arose after the Financial Markets Authority forced the company to pull its debenture prospectus which hoped to raise $350 million over the issues around asset quality and liquidity disclosure.
Since the receivership began, some $33,000 in employee entitlements have been paid.
The report said the company has several security interests with Motor Trade Finance Ltd., Marac Finance, Magnolia Lee Lease & Rentals, and UDC Finance.
Receivers noted that they had yet to receive a claim from the Inland Revenue Department.
In addition to its loan book, Korda Mentha said the company had an estimated $1.7 million in other assets which would be realise, consisting of inter-company loans, subordinated notes owned by NZF Mortgages, cash holdings and fixed assets.
Shares in parent company were unchanged at 3.5 cents today, and have declined 77 per cent so far this year.
Expect the good and the bad, not so good for debenture holders unfortunately but good for shareholders, not sure where the incompetence comment comes from.......do you think this might have been the cause of the receivership "The shortfall arose after the Financial Markets Authority forced the company to pull its debenture prospectus"!! I think you must be referring to bridgecorp and the like!
Not so good for Debenture holders? Any loss of capital is disastrous for them and they will lose some that is for sure - re read some of NZF Moneys ads over the last 12 months - were different, we have survived, our experienced lending team and prudent management - what a load of BS, their poor lending and management will cause retail investors to lose money and that is unforgivable. Not sure how you get good news for shareholders out of this, from memory didn't NZF have approx $10M of equity in NZF Money? I don't think anyone will want to partner with them now including Westpac.
The receivership isn't the fault of the FMA, they were hiding bad loans from Covenant, restructuring them and relying on outdated valuations to keep up appearances, i'm not getting mixed up with Bridgecorp just seeing a lot of simalarities. If the directors have signed off the Prospectus knowing this info then we could see further action, I believe Mr Feeley already has their email address's......
It is not conjecture if it is backed up by the Receiver is it. Stop listening to the directors, listen to the Reciever, Standard & Poors, Covenant and their Auditors!!
Also look up emminent in the dictionary, this has been going on for ages. You have stated on several occasion they are prudent lenders, do you still stand by that?
You won't find imminent under E in the dictionary.......
The share price is telling the story - believe that, not the company foghorn (invessi)
Westpac can and will stay, as long as they hold sufficient and watertight, realisable security. Watch out for the day it all goes tits up
I think that day has arrived...... Great news for shareholders indeed Invessi !!
NZF
22/09/2011 16:45
GENERAL
REL: 1645 HRS NZF Group Limited
GENERAL: NZF: NZF Group Limited (NZF) - Continuous Disclosure
NZF announced today that it has written down the carrying value of the
Group's investment in NZF Money Limited (NZFML) to $nil and has discontinued
including the results of NZFML in its consolidated financial statements with
effect from 22 July 2011, being the date that NZFML was placed into
receivership, as NZF no longer has direct control over NZFML's affairs.
This follows the receipt of legal, tax and accounting advice and the release
of the Receivers' First Report dated 21 September 2011 by KordaMentha,
Chartered Accountants, which indicated that there was unlikely to be a return
to unsecured creditors of NZFML.
The effect of the above will result in an impairment loss on investments of
$5.074 million being recognised by NZF in its individual parent company
financial statements for the year ending 31 March 2012 and a loss on
discontinued operations of $1
0..700 million being recognised by NZF in its
consolidated financial statements for the year ending 31 March 2012.
NZF would like to reiterate that the receivership of NZFML has had minimal
impact on the operation of NZF's profitable Homeloans Division and on NZF's
50% strategic investment in MPMH Limited (Mike Pero Mortgages).
A copy of the Receivers' First Report dated 21 September 2011 released by
KordaMentha, Chartered Accountants, can be viewed online at
www.companies.govt.nz.
ENDS
End CA:00214112 For:NZF Type:GENERAL Time:2011-09-22 16:45
If you read the receiver's report - he notes 28.3M of loan receivables, 16.4M of debenture liabilities.
The loan receivables have had impairments registered against them, by NZF, over the past few years.
Other various assets more than cover other various liabilities - noting the IRD has yet to make a claim.
The Receiver notes: "At this time it is not possible to accurately forecast the level of recovery from the loan book assets". Yet has taken the liberty to note: "... it is unlikely that there will be a return to unsecured creditors".
So, it seems that the receivers are forecasting at least a 60% impairment across the loan book. Given that the vast majority of this book is 1st mortgage, with the next big tranche being 2nd mortgages - it would appear that, according to the receiver, the quality of the loan book is very poor, indeed.
However, I think I will take a different view .... rather than rush off with the "adult diaper" brigade, I think a bet AGAINST the Receiver would be how I want to place my money. I wonder if you can buy NZF Money debt at 10cents on the dollar?!?
I think the impact of the accounting entries is to wipe out equity at the parent coy level...someone please correct me if i am wrong
Recoveries under first mortgage security in this environment are often coming up short so no cigars if the valuations are old and unrealistic
10 cents might get you a return, but 50 cents doesn't help the cause much - i think its gone
These Insolvency firms have been the real crooks in this GFC ... they produce these noddy reports that contain no real analysis of the situation, they paint the darkest possible view, present no facts or basic logic to justify their position; they proceed to sell off good assets at bargain prices, extract high fees or go off chasing shadows ... they leave a trail of misery. Some have a clue ... but most don't. There is actually alot to be said for US style Chapter 11 reorganisation.
I don't think even Bernard Whimp would offer 0.10 on this!
Does anyone really believe a JV deal will happen? I don't think any large corporate would want to be associated with them after they have recklessly lent out the publics money and investors will suffer losses.NZF have no bargaining power and wasn't part of the proposed deal to provide capital for NZF Money? Not much point now....you have to love the 4.45PM market announcements, at least it wasn't on a Friday!
Mini, isn't that an annoncement coming through now? Oh no it was just someone emailing me the winning Lotto numbers.....
Serepisos should have gone to NZF for a loan, looks like they will lend to anyone and he could have used his 2007 valuations!!
TTG, I am starting to wonder if you are the disgruntled borrower from NZF that threatened to take the company, particularly Mark Thornton to task for not meeting some expectation that you had, you are obviously not a shareholder and you are going out of your way to run the company down, how about coming clean and declaring your interest!
After you Invessi, I am intrigued how you can continually support the company and the statements it makes when the facts have made liars out of them. So what is your connection and why do you support them so strongly?
Actaully I don't mind going first.....
1 I have never borrowed from NZF or applied to do so.
2 I have held shares in NZF on several occasions but currently have no shares or notes.
3 IMO I have always advised people not to listen to the directors but gather the facts from S&P, Covenant and auditors and now the receivers. In hind sight this has been spot on. For a company that builds their reputation as being different from all the failed finance companies they have proved to be just the same, it just took a little longer.
I hate seeing people getting scewed over and everyone here has (debenture holders, shareholders and note holders) whilst NZF continues painting a rosy picture.
Anyway, your turn now Invessi.
TTG, have you ever had business dealings or relationship with NZF (beyond occasionally owning shares or notes)?
TTG, I am a share investor and I have some shares in NZF, I have also had past business dealings with them, whilst the current picture is not pretty, I still believe they have a future, particularly as the non bank residential mortgage sector (a potential $10b market) has considerable potential for growth, as does the RMBS market, the new partner will allow for some acceleration in my view! I receive the company's reports and I do look at them closely, I have no cause to believe that there has been any inaccuracies in their reporting. There have been suggestions that they have used outdated valuations for refinance, I very much doubt that, it goes against their covenants! As for Mike Pero Real Estate, I am getting feedback from friends who are in real estate and MPRE are starting to get traction!
GENERAL: NZF: NZF - Continuous Disclosure 27-09-11
Further to the announcement of 10 June 2011, NZF is pleased to announce that
it has entered into a conditional Sale and Purchase Agreement with Resimac NZ
Home Loans Limited (RML) which will see RML acquire a majority shareholding
in NZF's home loan securitization operations. There are a number of
conditions to be satisfied with the major ones being:
- Completion of a Shareholders Agreement which will among other
matters, give NZF certain minority protection rights.
- Receipt of certain IRD taxation rulings.
- NZF shareholder approval.
As the transaction will constitute a 'major transaction' under the listing
rules (but not the Companies Act 1993), shareholder approval by ordinary
resolution is required and corporate advisory firm Campbell Macpherson
Limited has been commissioned to prepare an independent report which will
accompany the notice of meeting to assist sha
reholders. All conditions are
expected to be satisfied on or before 30 November 2011 with settlement
shortly thereafter.
The signing of this agreement follows an extensive period of due diligence
which has been referred to in previous market announcements and NZF is
excited with the prospect of having RML as a partner in its home loan
business and the significant growth opportunities this will bring. RML's
parent is one of Australia's most respected non-bank lenders, providing
funding via its established and longstanding partners and to date having
funded more than A$12b.
ENDS
End CA:00214262 For:NZF Type:GENERAL Time:2011-09-27 11:21:53
Pero has high praise for low commission model
Thursday 22 September 2011
QV August 2011 – the regions
Mike Pero has hailed the success of his ‘next generation’, low commission real estate company, announcing it has established 17 franchise owners and a total of sales force of 23 between Auckland and Christchurch.
Mike Pero Real Estate launched in February this year and in May the first agents came on board in Auckland and Canterbury, offering the promised commission rate of 2.95% (plus GST), below the national average for real estate commissions from the major industry players or around 4% (plus GST).
"We did our market research before we launched and found that New Zealanders wanted lower commission rates, without compromising on service," said Pero.
"Our next generation culture and philosophies have hit a note with New Zealanders, and we're growing ahead of our expectations."
He said the Mike Pero business model was able to provide a lower commission structure by reducing middle management, new marketing technology and less bricks and mortar.
"We look at the traditional industry procedures and styles and question their effectiveness – we embrace online technology, innovative marketing and forward thinking - these are our points of difference that allow us to offer a better proposition to the vendor."
Pero said that on average, the lower commission rate of 2.95% would save sellers between $3,000 and $8,000, depending on the sale prices and other office commission rates.
"At a time when every cent counts that's a huge saving - for many people that could be a couple of months salary."
He also attributed the fact that Mike Pero Real Estate agents generally own their own franchises for their success in attracting top agents.
"Our model gives them the opportunity to build a business, not just a job, and acquire equity that could one day provide for their retirement, or at least a lump sum of cash."
The company aims to recruit from the top 20% of agents, "and there is no room for complacency - it ends up adding to the operational costs, which typically gets added on to the customers' fees."
So is this a take out of Westpac funding the SPV? What does this do for NZF other than put Resimac as the owner/funder of the securitisation vehicle?
Enumerate - Yes I have had some business dealings (not as a borrower) with them back when there SP was well over a $1.00. I found them extremely arrogant at the time and then decided to liquidate the majority of my shares which in hindsight was brilliant in realtion to where the SP is now. The only downside was I didn't sell the lot at the time.....
Invessi - It was the receiver who made reference to outdated valuations on loan roll overs, I think I would trust the receiver more than the company denying this. Whilst this is an anonymous forum, I doubt you are just a casual shareholder as the info you provide is not readily avalable to "casual shareholders".
At the end of the day this Resi deal should ensure the survival of the company and I am amazed they got it over the line so well done to NZF on that front. I suppose the devil will be in the detail as to pricing etc and what this will mean to all shareholders. Giving up a majority stake in the only part of your business that is profitable (pero's only made $10K last year) would not be a decision made lightly and would indicate there were no other viable options for survival.
I know how Savilles model works - I didn't ask for an explanation of thatQuote:
The Australian model is .....
TTG has largely answered the questions I posed anyway, and I would agree with him - Saville will gouge most of the profits from new business. Resimac criteria are very demanding - thats why they are so successful, and have not had the write-offs suffered by their peers. Time will tell as to whether they can get the required volumes of quality lending from this market.
I echo TTG's comment - good on NZF for getting it this far, but I'm not enthused about a long term future
Resimac to take majority stake in NZF's securitisation operations
NZF Group has at last revealed its long-awaited equity partner is Australian non-bank mortgage lender Resimac.
Tuesday, September 27th 2011, 1:20PM
by Jenny Ruth
Resimac will buy a majority stake in NZF's home loan securitisation operations for an as yet undisclosed sum. In June, NZF resumed originating home loans under its $225 million warehouse facility provided by Westpac.
NZF has been looking for an equity partner since early last year and Resimac has been conducting due diligence for months.
NZF says a number of conditions remain to be satisfied with the major ones being the completion of a shareholders agreement "which will, among other matters, give NZF certain minority protection rights," tax rulings and NZF shareholder approval.
NZF has commissioned corporate advisory firm Campbell Macpherson to prepare an independent report for shareholders.
While the price hasn't been disclosed, NZF says it will constitute a "major transaction" under the NZX listing rules which require shareholder approval for any transaction in excess of 50% of a company's market capitalisation. NZF shares last traded at 3.5 cents, giving it a $3.8 million market capitalisation.
NZF says it expects all conditions will be satisfied on or before November 30 and settlement should take place shortly afterward.
The transaction will help shore up NZF's balance sheet. Its net equity at March 31 was $10.3 million but that was before its finance company, NZF Money, went into receivership on July 22.
Last week, NZF said it would write off its $5.1 million investment in NZF Money and will record a $10.7 million loss from discontinued operations in its accounts for the year ending March 2012.
"NZF is excited with the prospect of having (Resimac's New Zealand arm) as a partner in its home loan business and the significant opportunities this will bring," the company says.
Resimac's parent is one of Australia's most respected non-bank lenders, providing funding via its established and longstanding partners and to date having funding more than A$12 billion (NZ$15.1 million).
Resimac set up its New Zealand office last year and this is its first significant move into the New Zealand market.
Founded in 1985 by the New South Wales state government, Resimac's current 80% shareholder is Ingot Capital Management, a company controlled by Duncan Saville who is one of Infratil's directors. Other shareholders include Westpac, National Australia Bank, Macquarie Bank and Credit Suisse First Boston and it also has standby support from Perpetual Trustee Company.
Hehe the NZF spin doctor must be getting Alzheimer’s.......
You two are not building any credibility by taking cheap shots.
The post actually contains some useful detail additional to the press release.
1) Resimac's parent is one of Australia's most respected non-bank lenders, providing funding via its established and longstanding partners and to date having funding more than A$12 billion (NZ$15.1 million).
2) Resimac set up its New Zealand office last year and this is its first significant move into the New Zealand market.
3) Founded in 1985 by the New South Wales state government, Resimac's current 80% shareholder is Ingot Capital Management, a company controlled by Duncan Saville who is one of Infratil's directors.
4) Other shareholders include Westpac, National Australia Bank, Macquarie Bank and Credit Suisse First Boston and it also has standby support from Perpetual Trustee Company.
Sheesh, Mini ... if it not clear that Resimac is very much a "blue blood" non-bank mortgage lender ... and this is the quality of the new owner of NZF Homeloans ... and this might be of interest to NZF holders ...
Also, it is clear that Westpac has an interest in Resimac ... and are also the current NZF Homeloans wholesale provider ... and this might be of interest to NZF holders ....
Given that Duncan Saville was also one of the NZ government spurned restructurers of SCF ... and that he now has an exposure to the NZ non-bank mortgage market ... and can be expected to be interested in aggressively growing this interest ... and possibly broadening his interests ... and this might be of interest to NZF holders ...
What will be impacts be on the Pero business, with a high quality non-bank mortgage lender actively interested in writing new, high quality, business in NZ ... would this be of interest to NZF holders?
Is it likely that NZF will be liquidating a significant equity position in NZF Homeloans as a result of the transaction? If so, what does the future hold?