SCF first-half loss nudges $200 million

The Timaru based lender today released audited first-half accounts showing a net loss of $198.6 million, worse than the unaudited $154.9 million loss it announced on March 1. It plans to split into three separate entities, one of which will take on all of the company's non-performing and impaired loans, as well as the majority of its $237.9 million net property loan book.

Another unit will hold all the firm's investments including Helicopters NZ, Scales Corp, Dairy Holdings, and South Island Farm Holdings, worth a combined $296.8 million. Any asset sales in the coming nine months to help meet maturing debenture repayments will come from this pool. The third unit will be its finance company operations.

The separation plan has echoes of Pyne Gould Corp's move to parcel the bad loans of its Marac Finance unit into Perpetual Asset Management, an asset management arm that will seek to recover the value of the loans.

Chief executive Sandy Maier said the hard work had now been done, and taking out the one-off hits from restructuring and providing for impaired loans, South Canterbury was now a "break-even business".