Friday 26th November 2010 5 Comments |
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The board of Equitable Mortgages has invited its Trustees Executor to appoint a receiver for the company.
Despite an orderly wind down of its group activities over the past three years - when its loan exposure has been approximately halved - the board deemed "there is no longer a viable business."
The company is an accepted entity under the Extended Crown Guarantee Scheme and while preferring an orderly scaling down of operations "this cannot be readily achieved under the current regulatory regime," the company said.
In a statement Equitable said in consultation with shareholders a number of factors had led to the decision including the continued asset deterioration on the small to medium sized commercial property sector, an absence of an acceptable new level of loan business and changed investor appetite.
"Accordingly, even through a going concern has been maintained with shareholder support up to the present, the board considers this can no longer be sustained."
Equitable said that at present its financial position is $32 million in cash on deposit, $188 million mortgages at net carrying value (all first mortgages), $191 million liabilities to debenture holders (with $179 million covered by the Extended Crown Guarantee Scheme) and $31 million capital.
The company said it has no bank or other indebtedness taking priority over debenture holders indebtedness.
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