Banksia loan portfolio sold to major European bank

by AB24 Apr 2013

Receivers and managers of Banksia Securities Limited (BSL), McGrathNicol and The Trust Company as trustee have announced the sale of BSL’s performing loan portfolio with a face value of $238.8 million to Deutsche Bank.

Receiver Tony McGrath says the group is pleased with the outcome of the sale, which he says will allow them to declare a further ‘significant’ distribution to BSL debenture holders.

“The sale was a competitive process with significant interest from a broad range of suitable parties, leading to a strong outcome for debenture holders.”

McGrath says the sale transaction was supported by BSL’s Committee of Debenture Holders and approved by The Trust Company.

David Grbin, group executive general manager, corporate client services at The Trust Company, says the trustee had approved the sale as it represented a ‘great’ outcome for debenture holders.

“In our role as trustee, we will continue to closely monitor the process and approve any further loans sales. Our on-going priority remains the best interests of debenture holders.”

Deutsche Bank is one the world's largest banks. Publicly listed in Germany and the US, it has over 100,000 employees and offers financial services in more than 70 countries. Deutsche Bank has operated in Australia since 1973 and has offices in Sydney and Melbourne.

There will reportedly be two further repayments made to BSL debenture holders by June 30, 2013, including:

  • 10 cents in the dollar to be paid on or around May 17, 2013, funded from interest receipts and discharges; and
  • 35 cents in the dollar to be paid by June 30, 2013, funded from the Deutsche Bank sale proceeds.

The receivers expect to have made total repayments of 65 cents in the dollar to BSL debenture holders by June 30, 2013 (inclusive of the first interim repayment of 20 cents paid in December 2012).

McGrathNicol also announced updated distribution guidance to BSL debenture holders yesterday. McGrath says that, as the performing loan sale represents over 50% of BSL’s remaining assets, securing the Deutsche Bank sale allows receivers to forecast repayments to BSL debenture holders with greater certainty.

“Whilst ultimate returns may vary due to a number of factors, our revised best estimate is an overall return of 80 to 85 cents in the dollar.”

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