South Canterbury Finance chair Allan Hubbard has taken the very unusal step of writing to investors to reassure them the company is in good health. Hubbard and
Hubbard felt the current crisis of confidence in the finance company sector after 35 collapses in just over 2 years required a letter to South Canterbury’s investors reassuring them of the financier’s strong position.
In the letter obtained by interest.co.nz, Hubbard says South Canterbury was unique in that it had survived depressions, wars and oil shocks and had just 15 per cent of its loans centred in Auckland and Wellington. He forecast a pre-tax profit for the just completed year to June 30 of NZ$85 million (including a capital gain on a dairy farm sale) and a pre-tax profit for the current year to June 2009 of NZ$50-60 million.
He also reiterated comments from South Canterbury management that South Canterbury had NZ$334 million of cash on hand at the end of June and a further NZ$150 million of undrawn bank lending.