The Crown’s net liability for South Canterbury Finance is about $600 million though the Cabinet is considering other options should the firm fail, Prime Minister John Key says.
“It’s in the ballpark of $600 million” Key told the post-Cabinet media conference. That makes it about two thirds of the $900 million the government has provided for under the guarantee, he said.
But today, according to The Herald:
The Government has already made a payment of $1.7 billion to cover losses to investors in the company.
Acting Treasury secretary Gabriel Makhlouf said all depositors and stockholders on South Canterbury Finance Ltd’s register of debt securities would be repaid by the Crown and they did not need to make a claim because the Trustee had done so on their behalf.
Malhouf said Treasury had now paid the trustee in full the sum owing to investors.
Treausury spokesman Angus Barclay said a payment of $1.7 billion had been made. However the Herald understands that covers all investors including some ineligible for payment under the guarantee.
It is understood Treasury wished to make a single payment early in the process to avoid paying out interest to investors.
Update: Ah, I think I get it – $600 million is the net liability. So the trustee now cashes up all the assets and pays back the taxpayer and that should – hopefully – return about $1.1 billion.