First payments towards a total $350 million owed to South Canterbury Finance's bond holders started yesterday - 25 days after the southern lending giant was placed in receivership owing $1.6 billion to 35,000 investors.
Following the August 31 receivership, the Government stepped in under its retail deposit guarantee scheme and assured investors they would be paid.
It curtailed any legal action by lending $175 million to the receivers to pay out first-ranked creditors, rather than face legal action.
The regional manager for Trustees Executors, Yogesh Mody, said yesterday that having worked through registries, and having had them audited, bond-holder payments would begin.
The bond-holders' payment consists of all the principal and interest owed, up until August 30, plus 3% interest from then until the payment date of September 23.
Mr Mody expected to make an announcement next week on repayment for South Canterbury debenture and deposit holders, who were told on August 31 payments were expected to take four to six weeks.
