St Laurence receivership to wrap up with nothing from Podmore bankruptcy

The receivership of failed lender St Laurence will probably wrap up with the last repayment to investors in March next year though nothing will have emerged from former boss Kevin Podmore's bankruptcy and his $20 million personal guarantee.

Receivers Barry Jordan and David Vance of Deloitte are working to dispose of the firm's last loan over a recycling operation in New South Wales, though they didn't get anything substantial from the guarantee made by Mr Podmore and backed by three of his companies, according to their latest report.

"While we have made some minor recoveries from one liquidation, we have not factored into our realisation estimate any recovery from Mr Podmore's bankruptcy," the report says.

Jordan and Vance expect to pay 2c in the dollar to investors in March next year in a final distribution to some 9431 debenture holders who put $212 million into the lender.

That distribution will take the total repayments to about 16c in the dollar since the receivership in 2008, on top of the 10c investors managed to get from St Laurence's abandoned moratorium.

That's the lower end of the 15-22c range they had originally expected and means there won't be any distribution for some $43 million of accrued interest or any amounts available for unsecured creditors including the capital note holders.

St Laurence was sent to the receivers after Mr Podmore went against the trustee's wishes by making an offer to debenture holders to swap their debt for equity in a new company that would hold the remaining assets.

Investors had previously agreed to a deferred repayment scheme, where 70% of the firm's debentures would be repaid by 2013 and the remaining 30% by 2021. Under that moratorium arrangement, note holders would have eventually been repaid by 2034.


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So, we were all quick to criticize Podmore; and maybe justifiably. Not that there has been any critical inquiry. Just the usual wide boy, envy based allegations. We learn nothing.

But who is critiquing these receivers? By what measure do we judge their performance? How do we know they could not have got an extra 2,3,4c in the dollar out of this?

It is a gaping hole in our insolvency legislation.

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