The head of South Canterbury Finance says the company will struggle to meet a cash target set by its credit rating agency, despite another cash injection from South Island businessman George Kerr.
His investment vehicle,Torchlight Fund, is stumping up another $15.5 million for the company - taking his total investment to $37.5 million.
The new money comes at a crucial time for the South Island lender.
In April, the global credit rating agency Standard & Poor's warned it may downgrade South Canterbury's BB rating, by a notch or more, if it fails to boost its cash balance to at least $150 million by the end of May.
South Canterbury chief executive Sandy Maier says the cash balance is tracking between $80 million and $100 million at the moment and meeting the target will depend on collections in the coming days.
He says the company's inclusion in the Government's extended retail deposit guarantee scheme will not be affected if it falls short.
On Friday morning, the company issued a statement saying it broke even in the first three months of the year.
It made $4 million unaudited operating profit for the period, before one-off expenses, investment losses of $3 million, impairment charges of $1.7 million and foreign exchange losses of $500,000.
Mr Maier says trading conditions are improving, and it holds $80 million in cash as borrowers repay loans and the lender sells assets.
South Canterbury Finance lost $198.6 million in the last six months of 2009.
