CBL Insurance IPO

[hardt]

Hmm - yes, this is what Peter Harris seems to claim. Question is - can he be trusted? I heard from some other (in my view trustworthy) source close to the action a different version of the story.

I have written off CBL investment comfortably without an ounce of stress, the destroying of a profitable business by an over reaching regulatory body stresses me out more than anything and a story will soon be public for you all to make up your mind.

The strengthening did not affect the $500m in cash reserves CBLC's.
RBNZ completed a 'without notice" application to liquidate CBLI as the 10yr reserve strengthening was underway.
RBNZ gave CBL & PWC 7 days to respond to the actuarial report from RBNZ's chosen auditor which took over 6 months to DRAFT and 5 days in decided no more time was to be permitted for a response.

17/02 - RBNZ advised CBL & PWC they had 7 days to respond to the draft report

21/02 - RBNZ determined CBL "is not yet required to prepare a recovery plan" ( a prescribed process under s 138 of NZ IPSA insurance regulations designed to get insurers back on its feet )
- Despite the fact CBL had already announced the reserve strengthening recommended by PWC

23/02 - Despite the previous assurances, RBNZ advised CLBI they had 3.5 hours to appoint a voluntary liquidator and, if not, RBNZ would immediately file an application for a winding up order and at the same time apply to the court for a liquidator to be appointed.

I cannot wait for RBNZ to get dragged through the coals over this... or most likely an internal investigation coming to a quiet ending.

RBNZ made claims in court which were contradicted by PWC/KPMG/DELOITTE.
RBNZ say and pay what they need to, to validate their actions.

Anonymous Survey of 200 large NZ Businesses:

50% claimed RBNZ does not have sufficient understanding of the realities of their industry

50% of businesses claimed their interaction with RBNZ was not-constructive

71.43% of businesses claimed RBNZ is not readily held to account for the quality of their work ( including mistakes being made )

[whatsup]

The DOCA alternative to liquidation for CBLI was agreed to by Korda-mentha, banks and creditors which stood to receive surpluses under the agreement. RBNZ were the only ones opposed to the DOCA regardless of the losses to creditors, policyholders and subsequently some of us on here.

RBNZ were lobbying those parties that agreed to the DOCA to change their position.
RBNZ even offered Alpha retention of the $40m payment made to it by CBLI in February so long as Alpha agreed to change sides and support the RBNZ.

The least respected regulatory body in NZ continues to deliver

All this being a dispute over CBL reserving:
Armour Re which now owns CBLI's largest creditor ( Elite insurance ), recently agreed to acquire CBLI's European reinsurance liabilities, agreeing with PWC's recommended reserving levels of $371.4m carried by CBLI in its balance sheet.
- the basis at which RBNZ claimed a solvent reserve level CBLI should be ( $600m OVER 50% more than PWC ) has been scoffed at by one of the most experience acquirers of reinsurance run-off portfolios in Europe.

DOCA is what ?

[BlackPeter]

I have written off CBL investment comfortably without an ounce of stress, the destroying of a profitable business by an over reaching regulatory body stresses me out more than anything and a story will soon be public for you all to make up your mind.

The strengthening did not affect the $500m in cash reserves CBLC's.
RBNZ completed a 'without notice" application to liquidate CBLI as the 10yr reserve strengthening was underway.
RBNZ gave CBL & PWC 7 days to respond to the actuarial report from RBNZ's chosen auditor which took over 6 months to DRAFT and 5 days in decided no more time was to be permitted for a response.

17/02 - RBNZ advised CBL & PWC they had 7 days to respond to the draft report

21/02 - RBNZ determined CBL "is not yet required to prepare a recovery plan" ( a prescribed process under s 138 of NZ IPSA insurance regulations designed to get insurers back on its feet )
- Despite the fact CBL had already announced the reserve strengthening recommended by PWC

23/02 - Despite the previous assurances, RBNZ advised CLBI they had 3.5 hours to appoint a voluntary liquidator and, if not, RBNZ would immediately file an application for a winding up order and at the same time apply to the court for a liquidator to be appointed.

I heard this story as well. Not sure, though whether it is true - as indicated - there is another side to it, and not all pieces of info I heard are compatible.

But whatever it is - the whole process was shocking and the oversight of NZ authorities clearly lacking. Yes, a proper and independant investigation into the saga would be essential to help NZ capital markets to regain some credibility.

[Joshuatree]

Voluntary Administration Watershed Meeting 2 pages 89.2KB

I make it Liquidation used 9 times = $9 million in fees?
Watershed(moment) used 10 times =$10 million in fees to KM? Justified and sanctified.

The way it is

[IAK]

CBL Corporation, once worth $750 million, put into liquidation.

http://www.stuff.co.nz/business/1126...id=app-android

[Brain]

Worth reading



https://www.nzshareholders.co.nz/pdf...ga%20media.pdf

[macduffy]

Worth reading



https://www.nzshareholders.co.nz/pdf...ga%20media.pdf

All power to the NZSA's efforts but personally I gave up long ago on any chance of recovering anything from my small holding.

[BlackPeter]

All power to the NZSA's efforts but personally I gave up long ago on any chance of recovering anything from my small holding.

I guess no matter whether there is anything salvageable for shareholders - much more important is that the story is fully investigated, that anybody who broke the law gets their day in court and that the public sees that our financial regulations get enforced.

We need to fully understand why it was ok that the board did breach its continuous disclosure agreements, we need to understand why it was ok that the company traded (as some say) for years (or even since listing) while insolvent and we need to understand why the RBNZ thought it ok to be complice in these things through not allowing disclosure.

It also would be interesting to know why it was ok to keep everything after going into "voluntary" administration from the owners of the company ... while lawyers representing who knows whom (but the owners) kept working for who knows whom but no doubt consuming many millions of the shareholder funds.

So far it feels like we learned nothing from the collapse of the finance companies. I hope this does not end up as another example where inept or fraudulent individuals destroy hundreds of millions and receive at worst a slap with a wet bus ticket. Happens too often in New Zealand without consequences - this can't be good for investor confidence into the national financial markets.

[SilverBack]

I guess no matter whether there is anything salvageable for shareholders - much more important is that the story is fully investigated, that anybody who broke the law gets their day in court and that the public sees that our financial regulations get enforced.

We need to fully understand why it was ok that the board did breach its continuous disclosure agreements, we need to understand why it was ok that the company traded (as some say) for years (or even since listing) while insolvent and we need to understand why the RBNZ thought it ok to be complice in these things through not allowing disclosure.

It also would be interesting to know why it was ok to keep everything after going into "voluntary" administration from the owners of the company ... while lawyers representing who knows whom (but the owners) kept working for who knows whom but no doubt consuming many millions of the shareholder funds.

So far it feels like we learned nothing from the collapse of the finance companies. I hope this does not end up as another example where inept or fraudulent individuals destroy hundreds of millions and receive at worst a slap with a wet bus ticket. Happens too often in New Zealand without consequences - this can't be good for investor confidence into the national financial markets.

Well BP, there is quite a number of individuals who were guests of Her Majesty after the 2008+ fiascos in the finance industry and there have been a few since. Others have been banned from business. The really smart ones knew how far they could go without incurring criminal charges and made sure they lived overseas. I receive FMA notices and I find that they are active and do bring action.

[BlackPeter]

Well BP, there is quite a number of individuals who were guests of Her Majesty after the 2008+ fiascos in the finance industry and there have been a few since. Others have been banned from business. The really smart ones knew how far they could go without incurring criminal charges and made sure they lived overseas. I receive FMA notices and I find that they are active and do bring action.

Quite a number? How many do you remember who have been convicted and served time?