Receivers for collapsed investment firm Banksia Securities Ltd have faced a barrage of questions at a public meeting attended by more than 600 people.JOHN LEWIS December 15, 2012 4:50am
Receivers of collapsed financial firm Banksia Securities Ltd faced a barrage of questions from hundreds of worried investors at Kyabram yesterday.
More than 600 debenture holders packed Kyabram P-12 College hall to hear McGrathNicol partner Tony McGrath update them on the receivership process and answer questions from the floor.
Meetings were also held at Shepparton and Ballarat.
Banksia Securities, a subsidiary of Kyabram-based non-bank lender Banksia Financial Group, went into receivership on October 25 owing $660
Investors’ moods at Kyabram yesterday were polite but forceful in demanding answers to why the company collapsed, who was to blame and how much of their money they could expect back and when.
Mr McGrath said the company’s failure could be traced back to the start of the global financial crisis ‘‘three, four, five’’ years ago, and its lending practises had not kept pace with changing market conditions.
Questions were raised about the expense of the receivership process and the necessity of sending out high-gloss reports to each account holder, with some households receiving more than one report.
Mr McGrath said it was a matter of balance.
‘‘We have to weigh up costs against getting information out. We are required to post this,’’ he said.
Asked later about $1.6
‘‘On balance, I’m comfortable with the way we charge,’’ he said.
Other investors asked if Banksia directors were still being paid.
Mr McGrath replied it depended on whether the holding company they worked for was still active.
Asked why the directors did not attend yesterday’s meeting, Mr McGrath said ‘‘it was their call not to be here. I didn’t especially invite them’’.
Mr McGrath said he was ‘‘very confident’’ investors would eventually receive between 50 and 65 cents in the dollar.
Banksia Securities investors have already received an initial distribution of 20 cents in the dollar.
One woman asked why her parents had not received any payment from another failed Banksia Financial Group fund, Cherry Fund Ltd.
A receivers and managers’ report predicted Cherry investors could expect 55 to 70 cents in the dollar.
Mr McGrath replied that Cherry investments were mostly tied up in a separate company called Banksia Mortgage Fund, which was still being administered by directors.
‘‘I do not have control over Banksia Mortgage Fund .
Mr McGrath later said ‘‘there were some issues around the stand-alone mortgage fund, with investors’ money being siphoned into that fund’’.
Asked about the possibility of legal action against directors and auditors, Mr McGrath said it was early days.
‘‘We all need to be better informed before anyone can make that decision,’’ he said.
He said he was hopeful that 75 per cent of receivership matters could be resolved by September next year.
‘‘But these things do play out over a period — some assets might take another year or two to finalise,’’ he said.
Mr McGrath said there was a ‘‘high degree’’ of engagement with state and federal governments concerning the Banksia collapse.
He also said McGrathNicol was in ‘‘constant dialogue’’ with the Australian Securities and Investments Commission about Banksia Securities.
Some asked receivers McGrathNicol how they could organise a class action.
They were told the receivers would not stand in the way of any action taken by debenture holders.
Shepparton’s Declo Bisimwa firmly believes education is the key to a better life.
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.
Garners Boxing Gym in Echuca is encouraging young people to get active with weekly boxing/cardio classes.
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.
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