Tuesday 29th December 2009
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South Canterbury Finance, whose shareholder was forced to inject funds and underwrite bad loans last year, named statutory management veteran Sandy Maier as chief executive.
Maier’s role will include overseeing the group’s loan portfolio and advising the board on South Canterbury’s recapitalisation, it said in a statement today.The finance company controlled by Allan Hubbard posted a net loss of $69 million in the year ended June 30 after taking provisions against non-performing assets such as property loans. It was forced to negotiate repayment terms with a group of U.S. investors after losing its investment grade credit rating.
Maier has been hired under a consultancy agreement with Hubbard’s Southbury Group and will be CEO of both the group and South Canterbury, the company said. He replaces Nigel Gormack, who became acting CEO when former chief Lachie McLeod left at the end of November. He is chairman of state-owned Learning Media, Radius Property, Pathfinder Asset Management and Oyster Bay Marlborough Vineyards.
He was a statutory manager of Development Finance Corp. in 1990-1992, assuming responsibility for the financing body that failed in 1989 amid loan loss provisions, having pursued an aggressive approach to lending.
Last week, S&P affirmed South Canterbury’s BB+ rating, saying the outlook was ‘negative.’ S&P cited the company’s access to debenture funding, new independent directors and clean financial statements.
South Canterbury’s liquidity and asset quality remained weak for the current rating and the firm is only in the early stages of addressing concerns about related-party investments, S&P said.
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