Crown faces $50m shortfall on Equitable payout
Taxpayers face a $50-60 million shortfall on the approximate $178 million paid out to investors in Equitable Mortgages under the retail deposit guarantee scheme.
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Taxpayers face a $50-60 million shortfall on the approximate $178 million paid out to investors in Equitable Mortgages under the retail deposit guarantee scheme.
In their latest report, receivers Grant Graham and Brendon Gibson of KordaMentha estimate loan recoveries might enable repayments of between 65% and 70% ($124.9 to $134.6 million).
The receivers have so far repaid $50 million to investors and the Crown.
The Treasury has refunded 97% of secured debenture holders owed about $178 million.
A further $14 million was owed to investors not covered by the guarantee.
Equitable had been rated BB by Standard and Poor's and was reviewed and accepted by the Treasury into the extended deposit guarantee scheme in April 2010.
The company was placed in receivership seven months later.
Equitable, part of Equitable Group owned by Christopher Spencer, had loans of $188.4 million at the time of receivership in November 2010.
Many of its loans were first ranking for commercial, industrial and residential property.
Duncan Bridgeman
Fri, 17 Feb 2012
Fri, 17 Feb 2012
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Crown faces $50m shortfall on Equitable payout
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