South Canterbury Finance Limited

[Jaa]

What would you like me to expand upon Alan ? I invested at 10.5% in debentures after negotiating an extra rate just before the original GG was imposed, it was a almost a dead cert SCF would get entry into the original scheme back in late 2008, so I took a small punt and invested just before SCF were approved original entry and ended up getting a great return all the way through...can't argue with a 10.5% GG return.

You could just have bought the SCF020 bonds on market at that time for more than 10.5%, no need for extra negotiation. The term may not have been perfect for you but then you can always sell them. Have never got the appeal of debentures.

Anyone else notice the SCF ads with the eyes suggesting they are worth a look for 8% on Stuff.co.nz and other sites? An effective ad as those things go.

[Balance]

Colin,
I think why there is so much passion here is that investors are not expecting any capital variability on debt. People expected the return on and return of their capital, without loss. That of course is naive but mum and dad who invested in those products and who have now lost some or all of their capital feel bretrayed.

They always considered the equity markets Russian roulette so there hasnt been the whinging about losses there, even though these have been severe.Eg Feltex

It's because taxpayers are likely to have to bail out hundreds of millions of dollars due to AH's stewardship of SCF.

[Enumerate]

Balance, is this what you really think ... or is that the clairvoyant octopus talking:

It's because taxpayers are likely to have to bail out hundreds of millions of dollars due to AH's stewardship of SCF.

Finally, let's remember who is putting at risk hundreds of millions of taxpayers' money through the mismanagement of SCF?

For putting hundreds of millions of taxpayers money at risk, YEAH RIGHT.

Disclosure of interest - taxpayer who is cheesed off that we are going to have to pay for AH's mess.

Maybe the right tentacle doesn't know what the 7 left tentacles are doing? That is why it gets repeated so often.

Repetition does not make this correct.

I think you are missing the key part of COLINs post - which Dubdee responded to:

It will remain a great mystery to me as to why there has been such an outpouring of hostility and bitterness, on this thread, when there are a host of serious loss situations which are far more deserving of investor wrath. Incredibly, the people who are venting most spleen, here, would appear to have not one dollar at stake in any Hubbard connection, if we are to believe their posts.

Now this is the "central mystery" of the thread.

[Beagle]

Originally Posted by COLIN
It will remain a great mystery to me as to why there has been such an outpouring of hostility and bitterness, on this thread, when there are a host of serious loss situations which are far more deserving of investor wrath. Incredibly, the people who are venting most spleen, here, would appear to have not one dollar at stake in any Hubbard connection, if we are to believe their posts.
Now this is the "central mystery" of the thread.

Its current, its could have been avoided with proper management or if Lachie McLeod had the foggiest idea about commercial prudence and its because AH used his VW like a badge, a very cunning marketing trick, right up there with a certain other company using Richard Long as their slight of hand.

Exceptionally cunning subliminal marketing on both counts, so says the Octopus.....

Of course not to forget that there's been a flagrant breech of the Securities Act and then of course there's just the fun at picking holes in all the cultists like yourself just for the sport of it, (not that I would enjoy such a thing of course), LOL.

Will AH see you right if you go down the toilet with your preference shares ?

[mouse]

The point is that lots of money is at risk with the Govt Guarantee. What makes it worse is that the Govt Guarantee for SCF could have prevented action on other serious problems. Thankfully it has not, but why the Guarantee was extended for SCF in the first place concerns me. I am sure AH is honest, it is his competence that is questioned. A lesson that people should plan to hand on companies when they are still active.

[Enumerate]

I fully understand that you mean this as a taunt, but here is a serious response:

Will AH see you right if you go down the toilet with your preference shares ?

Not only do I believe that Allan will "see us right" - I believe that he has already "seen us right".

The introduction of Helicopters and Scales - as equity assets - was the major part of the "refloating" of the balance sheet.

Allan Hubbard did not have to do this. He could have walked away - after all the equity value of SCF was less than the various assets he introduced. He could have relied on the government guarantee to "see his investors right". If I have any measure of the man - this thought wouldn't even have crossed his mind.

The SCF balance sheet is not what I am primarily depending on, however. SCF, its customers and the community it serves, is something I have seen before - Percy reminded me of the Smiths City recovery. I was a significant capital note holder, in this company. They saw me right.

I will confess that I am deeply impressed by the integrity and intelligence of Allan Hubbard, the man. The Kipling poem "If" reminds me, in verse, of what I can expect of the man, in life:

If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: 'Hold on!'

It is these combination of factors. The basic financial strength is there, this is not a lost cause. The community is behind this business, there is strength in this. Both Maier and Hubbard clearly have the insight and energy to focus available resources to achieve a significant outcome.

Contrast this with the fear and weakness in the investment community. People who would not raise a finger to warn or prevent $6billion of collapse, now smell blood at SCF. However, I smell their fear. It is a wonderful time to stand up and be counted.

I have not finished buying SCFHA, yet. I acknowledge the significant risk, I acknowledge the doubts. This is another "turn of pitch and toss" - I have been here before many times.

[Alan3285]

Very Cunning, double your money, getting out and the most cunning part, staying out. May we presume you think they're going under in due course ?

No - I would doubt that, and if the SCFHAs dip down to 10c, I'll probably get back in.

The SCF010 is also looking quite attractive, but I am already fully exposed to the NZ Finance sector elsewhere (ALF010 for example) so I don't want to increase that right now.

There are always opportunities.

Alan.

[Alan3285]

You could just have bought the SCF020 bonds on market at that time for more than 10.5%, no need for extra negotiation. The term may not have been perfect for you but then you can always sell them. Have never got the appeal of debentures.

For investors who don't really understand finance, debentures appear nice and simple and they think they are 'safe'.

Personally, it would give me the heebie jeebies to have my investments locked up in a debenture for 12 months (say).

Alan.

[Beagle]

Originally Posted by Jaa
You could just have bought the SCF020 bonds on market at that time for more than 10.5%, no need for extra negotiation. The term may not have been perfect for you but then you can always sell them. Have never got the appeal of debentures.

Actually Jaa, I just checked on the Chart of SCF 020's in Novermber 2008 they were trading in the high 9's yield range and then I would have had to pay brokerage to buy them reducing the net running yield to around 9.5% to me..

Speaking of brokerage the fact that as an investment advisor at the time recommending SCF I earned 0.75% brokerage of them on top of the 10.5% interest rate was a material additional bonus, very tasty indeed and I remember having a free holiday in Australia on that one.

[Breastwork]

So here we have the SFO, of which Botherway is a director, in pursuit of Allan Hubbard for "too much paper in his accounting system" (though that doesn't effect the accuracy of the accounts) and "too little paper in the regulatory compliance" (though this does not seem to have worked in endless other finance companies and funds).

Enumerate - Don't let the facts get in the way of your little hissy fit. Hope you'll be man enough to apologize for your misinformation.