26 Mar 2013

South Canterbury Finance cost likely to exceed $700m

7:10 pm on 26 March 2013

The collapse of South Canterbury Finance is set to cost taxpayers more than $700 million.

The receivers will finish their work this week, saying they have recovered more than $770 million of the $1.58 billion the failed company owed.

South Canterbury Finance was placed in receivership in August 2010 after it failed to fix its problems by restructuring.

That triggered a Government payout of $1.58 billion under the Crown deposit guarantee scheme.

It is now up to Crown Asset Management, which owns the company's assets, to get as much money as it can for the Government.

The assets were worth about $90 million at June last year and any money made from their liquidation will go towards the $800 million shortfall.

The latest report from receivers Kerry Downey and William Black states all assets from the company have been realised.

The report says all preferential creditors have been paid out in full but unsecured creditors and shareholders probably won't get anything.

One final distribution of funds is to be made before the receivership finishes at the end of the week.

Five men face 21 fraud charges relating to the company's collapse and will appear in the High Court in Timaru early next year.