Sharechat Logo

Money flowing in at Marac

Friday 27th June 2008

Text too small?
While it's been a week of bad news for finance companies there is some positive news too.

Marac kicked off its $125 million, five-year bond offer and has outlined that its rates for reinvestment and new money remain strong.

Managing director Brian Jolliffe says the purpose of the bond offer is to further diversify the business and to get some longer-term money on the books.

He says Marac has always aimed to diversify both its lending and funding base.

On the funding side the company has $480 million committed bank facilities along with a $300 million securitisation programme which is supported by Westpac.

Jolliffe says it has consolidated its bank programme which is now supported by all five of the major trading banks.

He says many people don't realise that "banks are the single biggest investor in Marac by a long way."

This is an opportunity to get some new investors on board and to get a completely new investor base.

Jolliffe says the bond offer will bring a whole new group of investors to the company. Also about getting some five-year liabilities on the balance sheet.

An issue with debentures is that the investors determine the term, which then impacts how the company can lend.

Jolliffe says Marac's reinvestment rates have held up during the down term and it has been getting an increasing amount of new investments at well.

Currently it has around $140 million in liquidity and this will swell once the bond offer is completed.

Reinvestment rates sit in the 65-75% range and new money flows remain strong. In fact, "May was our biggest new money month we have had since June last year."

"It's going on into June too," he says.

Jolliffe says Marac primarily finances plant and equipment to small and medium sized enterprises. Currently some sectors such as agriculture and infrastructure are strong with good lending opportunities while others like manufacturing and transport are weaker.

Marac does have some property lending. It has around $200 million in developments and another $100 million in tenanted commercial and industrial properties.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

28th October 2021 Morning Report
Wellington Drive Technologies Limited (NZX: WDT) Performs Strongly in Q3-2021
Ryman Healthcare Limited (NZX: RYM) Acquires Extensions to Two Existing Victorian Sites
Promisia Healthcare Limited (NZX: PHL) Banking Covenant Update
Pictor Limited Announces Start of US Clinical Trials for SARS-CoV-2 Serology Test
Arvida Group Limited (NZX: ARV) Opening of Rights Offer
Move Logistics Group Limited (NZX: MOV) Announces $40m Capital Raise
27th October 2021 Morning Report
The a2 Milk Company Limited (NZX: ATM) Investor Day 2021
Contact Energy Limited (NZX: CEN) Considers Green Capital Bond Offer