SCF news bad, but rates good

The finance company, facing a $500 million "wall of maturities" of debentures coming due by October, needs investors to roll over their money. Some may be thinking twice after Standard & Poor's cut SCF's credit rating two notches deeper into junk at B- as statutory managers took over elements of Hubbard's empire. 

On offer are debentures that mature within the extended guarantee that pay 8% annual interest. Existing investors who re-invest get even better - 8.25%.

To beat that from finance company paper, investors would have to turn to firms that are not covered by the guarantee scheme. 

Among those ‘going naked' are Allied Nationwide Finance, with 8.75% for 12-month deposits and 9% for 18 months. By comparison, Marac offers a government-guaranteed 6% for 12 month terms and 4% for 18 months.