Bernard Hickey in his daily commentary says that Cabinet is reviewing possible rescue of SCF. Hickey’s published commentary includes this:-
The option understood to be before the government is for the government to buy South Canterbury’s bad loans, the so-called bad bank, which would allow the new owners to recapitalise the ‘good bank’.
BusinessDay reports that Sydney based investor Duncan Saville, who is Infratil’s largest investor and is involved with potential Allied Nationwide rescuer Resimac, was the bidder behind the recapitalisation plan before the government.
However, Allan Hubbard told Patrick Smellie at Business Desk the Treasury had recommended the government not go ahead with such a ‘bad bank’ purchase. Finance Minister Bill English was cagey in an interview on TVNZ’s Q&A on Sunday, as was Prime Minister John Key on TVNZ’s Breakfast this morning.
There is coverage as well in the NZ Herald on SCF and on the SFO investigation. Audio reports as well at Morning Report where an analysts sees bailout unlikely and comments by SCF CEO Sandy Maier who says bids are on table but no government deal, plus this Mike Hosking piece at Newstalk ZB. Kiwiblog comments here.
1.Presently the situation is unclear, perhaps we will know more at the end of today.
2. Reading various reports it would appear the position as to the contents of the PWC report is unclear.
3. The SFO is expected to indicate the direction it will go in this week.
4. Whatever happens many people will be upset/disappointed by the decisions taken