Tuesday 31st August 2010 |
Text too small? |
New Zealand’s credit ratings aren’t immediately affected by South Canterbury Finance’s $1.6 billion call on the retail guarantee after falling into receivership, Standard & Poor’s says.
The government made the payment to Trustees Executors, the trustee for debenture holders. The $1.6 billion amounts to 0.8% of New Zealand’s gross domestic product and was paid in full today. The government plans to recoup the cost through the fees charged for participation in the guarantee scheme and proceeds from the receiver.
Prime Minister John Key has said the net impact is $600 million – eating up two thirds of the $900 million provision for companies covered by the guarantee. The trustee today appointed receivers Kerryn Downey and William Black of McGrathNicol to South Canterbury, which has 35,000 investors eligible for reimbursement from the government.
S&P’s views of New Zealand's sovereign creditworthiness “are not immediately affected by today's announcement that money owed to SCF’s debenture holders was paid under New Zealand’s Crown retail deposit guarantee,” it said.
New Zealand has an AA+/A-1+ foreign currency debt rating at S&P. The local currency rating is S&P’s top AAA/A-1+. The outlook is stable.
The nation had sound public finances, a sound financial sector, resilient economy and transparent policy environment, it said. Against that, New Zealand has a high level of private-sector external indebtedness that “offset these strengths, in our view,” S&P said.
Businesswire.co.nz
No comments yet
Spark New Zealand appoints new director to the Spark Board
AFT to announce full year results on May 23 2024
CRP - Korella North Takes Another Two Steps Forward
May 3rd Morning Report
ASB workers to strike as bank proposes an effective pay cut
Rising tides, sinking stocks: study explores cost of climate change
May 2nd Morning Report
AGL - Change in Senior Management
Devon Funds Morning Note - 01 May 2024
Rick Christie to step-aside as a non-executive director