F&P Finance doing better than expected

Chairman Gary Paykel told shareholders at the annual meeting the finance unit "stuck to its knitting" by concentrating almost exclusively on point-of-sale consumer credit, and had managed to lift its operating revenue as interest rates came down in a tight credit environment.

Still, the credit crunch didn't leave the finance company unscathed, with F&P Finance needing to write down more bad debt and boost its level of provisioning against rising levels of delinquencies.

The unit "operated in a niche market in which it has sound industry knowledge, an established track record, and unique skills and competencies," Paykel said.

Chief executive John Bongard said the expiry of the government's retail guarantee deposit "will likely have an impact on the level of funding" and that there were still uncertainties as to whether it will end in October next year, or be extended under new terms.