9 Jul 2010

North South receivers estimate 70c in dollar return

7:55 am on 9 July 2010

Receivers of failed finance company North South Finance say it's unlikely investors will get back more than 70 cents for every dollar they invested.

On Wednesday, the Securities Commission charged the directors of North South Finance and related firm Dominion Finance Group with failing to give investors a true picture of both companies' financial positions.

North South Finance chairman Rick Bettle on Thursday asked the company's trustee, Covenant, to appoint receivers, saying it's inappropriate to continue operating in light of the charges.

Receiver Brendon Gibson of KordaMentha says North South Finance has been operating under a revised repayment plan for about 18 months, and fifteen property loans are yet to be repaid.

Mr Gibson says receivers will continue dealing with the outstanding loans, which he says are worth about $15 million.

Investors have received 55.5 cents in the dollar though he moratorium process, he says, and at current estimates they will receive about 70 cents in the dollar.