Deniliquin Council believes it is unlikely it will receive any more money from a Lehman Brothers investment.TYLA HARRINGTON February 19, 2014 4:45am
Deniliquin Council’s Lehman Brothers collateralised debt obligation investment could be totally written off.
A $250,000 investment with the now defunct Lehman Bros, which collapsed as a result of the 2008 global financial crisis, is now valued at just $17,500.
Deniliquin Council general manger Des Bilske said it is unlikely council will be receiving any more money from the investment.
Council director of corporate services Terri Maguire, in a report to council, said one more ‘‘credit event’’ would cause the investment to be written off.
She said there is a ‘‘high possibility’’ of that credit event occurring.
‘‘Council controls are in place to reduce the risk of this (bad investment) happening again,’’ Ms Maguire’s report says.
‘‘(To mitigate the risk) future investments (will be) invested in a range of banks with no more than 20 per cent of council’s total funds invested with a single institution.
‘‘Council has taken the necessary steps to reduce the risk of losing significant investments in the future.’’
Council invested in the Lehman Brothers CDOs based on advice received from Local Government Financial Services on December 20, 2006.
The investment was arranged by Amro Rembrandt, was given an AAA rating by Standard & Poors and sold by Local Government Financial Services.
Deniliquin was one of 12 councils to join forces to form a case against LGFS, Amro Rembrandt and S&P in 2013.
The Federal Court of Australia ruled in favour of the combined councils and, as a result, Deniliquin Council was awarded $190,949.53.
Council also invested an additional $500,000 with Amro Rembrandt.
Combined with an earlier repayment of $34,465.39 in 2008, council has been able to recover $225,414.92 of the $500,000 invested directly with Rembrandt.
Coca-Cola Amatil has confirmed it will be pressing on with its $100 million redevelopment of SPC Ardmona.
Beautiful weather greeted Tungamah residents for the 18th running of the Tungamah Lions Ten Thousand on Sunday.
When Keith and Marion Grumley and their growing family moved to Tatura on January 18, 1968, little did they know that it would be the start of a long and lasting connection to the town.
A snake was spotted this afternoon.
Rochester Rotary Club has celebrated its 50th birthday in style.
Sorting future of Campaspe pools
A theatre production with a difference is coming to Seymour.
Local athletes will go head-to-head with some of the best competitors from around the world in swimming and athletics in December.
District residents and visitors will be able to enjoy some of the region’s most beautiful private gardens on Sunday.
The 116th annual Cobram Show went off with a bang at the weekend, drawing in crowds from far and wide for two days of fun.
Tomorrow is a Total Fire Ban day in Deniliquin, meaning no fires can be lit in the open and all fire permits are suspended.
Fifty new full-time jobs will be created at Tatura with a multimillion-dollar expansion of the abattoirs expected to be announced today.
Remembering Australian political giant Gough Whitlam who once called on Benalla police to stop then Treasurer Frank Crean on his journey up the Hume to phone the PM.
Discover unbelievable local deals from local businesses every week in the Goulburn and Murray Valley area with Leapon.com.au!
Search properties for sale or rent across North Central Victoria and Southern NSW. Visit your local website for local homes....
Search for published and unpublished photos from McPherson Media Group newspapers and magazines. All our photos are available to purchase.
Place an advertisement in any one of McPherson Media Group's local newspapers.