Failed South Canterbury Finance's receivers have confirmed funding support will continue for borrowers who meet the lending criteria.
South Canterbury, being unable to recapitalise itself, was placed in the hands of receivers McGrathNicol last week owing about 35,000 investors $1.6 billion.
Those investors will be paid out by the Government next month under its deposit guarantee scheme.
While investors get paid in full in coming weeks, uncertainty surrounds the future for borrowers, especially those in the dairy sector where debts are high, farm values have fallen and commodity prices had until recently been flat.
Receivers Kerryn Downey and William Black said confirming continuity of funding lines for performing customers would help maintain the ongoing business operations and preserve the value of the assets.
"Over the past week, SCF Group senior management and staff have contacted the SCF Group's major customers to determine their funding requirements and make the necessary arrangements," the pair said yesterday.
The Government's swift move to pay investors and first-ranked creditors means it is effectively in control of all South Canterbury's assets and can sell them to recoup its losses without having to enter lengthy legal battles.
The receivers said they had been working closely with South Canterbury senior management and staff and had made "considerable progress in stabilising the group's operations under the receivership".
"We recognise the importance of stable ongoing funding to SCF group's customers and we want to reassure customers that funding will continue where lending criteria are being met."
The receivers were continuing to get inquiries from prospective asset purchasers, which were being recorded in registers held by the Crown and themselves.
COMPANIES COVERED
SCF companies covered by receivership. -
> South Canterbury Finance Ltd, Belfast Park Ltd.
> Braebrook Properties Ltd, Face Finance Ltd.
> Fairfield Finance Ltd, Flexi Lease Ltd.
> Galway Park Ltd, Helicopter Nominees Ltd.
> Hornchurch Ltd, Rental Cars Ltd.
> SCFG Systems Ltd, Sophia Investments Ltd.
> Southbury Insurance Ltd, Tyrone Estates Ltd.
