The receivers' first report into South Canterbury Finance shows a shortfall of nearly $315 million, with assets of $1.39 billion and liabilities of $1.71 billion.
Receivers Kerryn Downey and William Black of McGrathNicol were appointed to SCF on August 31, and the Government announced it would make full settlement to investors under the terms of the retail deposit scheme.
A breakdown of SCF loan advances put total external advances at $1.22b, including around $691m to business, $180m to rural, and $256m on property.
A further $341m in loans were advanced to charging group companies, while SCF also had impairment provisions of $446m.
The receivers said that, in accordance with the law, they had omitted from the report their estimates of what SCF's assets would realise.
That was because they believed that including that information could affect, in particular, the receivers' duty to obtain the best price reasonably obtainable for the company's assets.
Deutsche Bank is advising on the sale of SCF's core finance company business, while Goldman Sachs & Partners is advising on the sale of SCF's 100 percent shareholding in Helicopters (NZ) and its majority shareholding in Scales Corp.
The receivers said their initial focus had been on stabilising the business and operations, including maintaining the management team and staff, to preserve value for stakeholders and maintain ongoing trading.
Initiatives to support the ongoing business of SCF included updating and revising SCF's credit policies and delegated lending authorities and the formation of a formal credit committee, and expansion of the credit function to ensure appropriate review of all new draw downs.
The internal audit function had also been expanded and a work schedule implemented to review new lending and ensure adherence to credit policy, including approvals risk assessment and the adequacy and quality of security, the receivers said.
They also noted that they had notified appropriate authorities in relation to certain specific transactions that took place before they were appointed as receivers.
