Thursday, April 3, 2008

Apologies for anguish caused

Lombard Group, which listed on the NZX in December 2005, said today that its wholly owned subsidiary, Lombard Finance and Investments Ltd, has invited Perpetual Trustees to call a meeting of secured debenture holders to consider a moratorium on its obligations to investors.

"It is clear from recent events that this is a systematic failure of an entire industry, and from our perspective a moratorium is now the only responsible course of action," Lombard Finance and Investments chief executive Michael Reeves said.

Mr Reeves said $111 million was owed to holders of secured debenture stock and $16 million to holders of subordinated notes and subordinated capital notes.

The company has loans with a book value of $143 million, but does not know how much it will recover in the current market.

"I and rest of the board very much regret this has occurred and the anguish this will cause investors," Mr Reeves said.

One wonders how many elderly people, who have worked and saved throughout their lives, are now being left almost destitute by these finance company failures — at a time when they thought they would be able to look forward to a comfortable retirement.

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