Wednesday 6th June 2018
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The Auckland High has set aside three days beginning July 30 to hear the Reserve Bank’s application to liquidate CBL Insurance, currently in interim liquidation, the central bank said in a release.
The High Court ordered CBL Insurance be placed into interim liquidation on an application by the Reserve Bank as the insurer's prudential supervisor, in late February. The central bank alleged that CBL Insurance breached solvency margins and statutory directions. CBL Insurance is a unit of NZX-listed company, CBL Corp, which is in voluntary administration.
Yesterday the Reserve Bank withdrew from a scheduled liquidation hearing involving CBL Insurance slated to take place this week and requested that the interim liquidation continue.
"Parties opposing the liquidation recently asked the Reserve Bank to give consideration to some additional options for dealing with CBL Insurance. The hearing was deferred at the request of the Reserve Bank to allow any stakeholders the opportunity to present such options and for the Reserve Bank and the interim liquidators to consider those options properly," the central bank said in a statement.
The application for liquidation is being opposed by CBL Insurance, led by Harris and Alistair Hutchison, as well as KordaMentha, the voluntary administrators of CBL Corp and Elite Insurance, CBL Insurance's largest creditor.
Harris and Hutchison have proposed an initial restructuring plan that has been circulated to the voluntary administrators with the objective that all CBL Corp creditors get paid in full, NZ insurance policyholders all get paid, and shareholders retain shares in the future business to give them some future value to their shares.
The plan would seek to avoid liquidation of CBLC and CBLI.
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