The sorry list of finance company failures

http://www.nzherald.co.nz/section/12/story.cfm?c_id=12&objectid=10517059&pnum=2

Chronology of the finance company collapses:
1. May 2006: National Finance 2000
The company held deposits of $25.5m on behalf of 2026 investors, and had made loans totalling $27.3m to 3765 individuals or companies. In March this year, receiver said secured investors had received back 40c in the dollar at that stage.

2. June 2006: Provincial Finance
Receivership seen as best way to protect the interests of debenture stock holders, who had invested $300m with Provincial. Last month secured debenture holders received a further return of 7.5c in the dollar bringing the total returned to 65c per dollar invested, or $192 million.

3. August 2006: Western Bay
Tauranga-based finance company Western Bay, owing more than $48m to investors and having lent $53m in around 10,000 of loans. In December receivers announced a second payment to debenture holders, estimating an eventual recovery of 81c to 82c in the dollar.
2007

4. July 2 2007: Bridgecorp
Specialist property financier Bridgecorp, after defaulting on repayments of some term investments due to investors owing about $500m to 18,000 investors. Late in July, investors were told they could receive anything between 25c and 74c for each dollar invested, with the wide range partly due to complex offshore investments. Receivers said at June 30, Bridgecorp's had 69 loans totalling $393m, with many of the better quality loans sold off.

5. August 21 2007: Nathans Finance
Nathans Finance, owing $166m to around 6000 investors. Nathans was a wholly owned subsidiary of vending technology company VTL Group Ltd which the day before the receivership announced it was insolvent due to a Companies Office investigation of Nathans.

6 August 29 2007: Property Finance
Property Finance, which has debentures of over $80m and loans of over $630m. It reported it was in deep trouble and unlikely to be able to honour its debts.Came out of receivership February 8 2008 and resumed payments to investors.

7. August 30 2007: Five Star Consumer Finance
Five Star Consumer Finance, with receivers PriceWaterhouseCoopers (PWC) saying big loans in its $51m lending book were "outside normal lending practices". It said lenders may get as little as 25-40 per cent of their money back. Prospectus showed it owed $57.6m at March 31, 2006, in various dated debentures and had lent out $68.7m.

8. September 4 2007: LDC Finance Ltd
LDC Finance Ltd trustee Perpetual Trust calls in PWC as receivers. The company has 995 depositors and debenture holders owed $19.3m, and assets of $23.8m.

9. September 5 2007: Finance and Investments
Nelson-based car finance firm Finance and Investments was placed in receivership with PWC by principals Andrew Harding and Murray Scholfield, owing 370 investors $16 million. Finance and Investments received funding from LDC.

10. October 4 2007: Clegg and Co Finance
BDO Spicers appointed receivers to Auckland-based financier Clegg and Co Finance. Clegg had around $15m of 500 investors' funds in debentures. Covenant Trustees said Clegg's trust deed had been breached to a "significant extent". The breach of a related party loan meant Clegg had minimal, if any, residual shareholders funds.

11. October 2007: Beneficial Finance (in moratorium)
Auckland company with $24.2m of investors funds.

12. October 16 2007: Geneva Finance (in moratorium)
Geneva Finance stopped taking deposits and put a moratorium on paying interest on all investments until April 2008. The company is dependent on a $50m credit line from the Bank of Scotland. Geneva owes about 3000 creditors over $138 million.

13. November 29 2007: Capital + Merchant Investments
Capital + Merchant Investments placed in receivership. Capital + Merchant Finance Ltd and Capital + Merchant Investments, had breached general security agreements with Australian company Fortress Credit Corp, said receivers from Grant Thornton. Capital + Merchant owes investors around $200m.

14. December 17 2007: Numeria Finance
The small financier with 480 debenture holders and assets to the tune of around $7 million, is associated with Capital + Merchant Finance, which was put into receivership two weeks ago.Numeria Finance failed because of a lack of cashflow, the company's trustee Perpetual Trust said.
2008

15. May 18 2008: MFS Pacific Finance, re-named OPI Pacific Finance (in moratorium)
MFS Pacific Finance became the fourth finance company to enter into a moratorium as its stockholders voted almost unanimously in favour of a three-year plan aimed at paying them back more than $300 million.

16. March 14 2008: MFS Boston (in moratorium)
Finance company MFS Boston staved off receivership after receiving approval from its debenture investors to wind down the business through a 20-month moratorium.Its 1700 investors were asked to allow the company to freeze redemptions and attempt to return the $38.5 million borrowed from them in the form of quarterly instalments.MFS Boston, is an indirectly-owned subsidiary of troubled Australian investment company MFS.

17. April 3 2008: Lombard Finance and Investments
"It is clear from recent events that this is a systematic failure of an entire industry, and from our perspective a moratorium is now the only responsible course of action," Lombard Finance and Investments chief executive Michael Reeves said.Mr Reeves said $111 million was owned to holders of secured debenture stock and $16 million to holders of subordinated notes and subordinated capital notes.

18. April 15 2008 Kiwi Finance
Smaller New Plymouth-based company.

19. May 13 2008: Cymbis New Zealand (re-named Fairview)
Cymbis New Zealand is a small finance company acquired late last year by troubled Australian firm MFS. Owes $6.9m to just under 800 stockholders.

20. May 28 2008: Belgrave Finance
The rapidly cooling property development market is a major factor in the collapse of Auckland-based Belgrave Finance, which became the 20th finance company failure in the last two years, its directors say. The property development financier has a loan book of about $28 million.

21. June 18 2008. Dominion Finance Holdings
Dominion Finance Holdings (DFH) considers a moratorium on payments to debenture holders after becoming concerned about the liquidity of its two subsidiaries, Dominion Finance Group (DFG) and North South Finance Ltd (NSFL). Debenture holders owed $276m at March 31 2008.