Provident Capital investors receive further distributions

Larry SchlesingerMay 29, 2013

Investors in collapsed mortgage lender Provident Capital’s monthly income fund (MIF) have received further distributions as liquidators from PPB Advisory continue to dispose of loans.

MIF unit holders received nine cents per unit on May 17 following distributions totalling 61 cents per unit since December last year.

Unitholders in Provident Capital’s high yield fund (HYF) have received 66 cents per unit in total distributions, with the last payment of 14 cents per unit in February.

Creditors voted to liquidate the $130 million subprime lender in October.

Provident Capital acted as a lender of last resort on risky development, charging very high interest rates and fees.

It collapsed in July last year following an application by Australian Executor Trustees Limited (AET), a trustee for Provident Capital debenture holders. It then emerged that 85% of loans were six months or more in arrears.

“The timing and amount of any further payments from the fund will depend on how the wind up process proceeds and the extent to which the remaining assets continue to earn income,” said Marcus Ayres, Tony Sims and Philip Carter receivers and liquidators from PPB Advisory.

“Income distributions may be made at the same time as payments arising from the realisation of the fund's assets.

“Investors will receive a tax statement in respect of their income distributions at the end of the financial year

To date distributions to unitholders totalling 66 cents in every dollar invested have been made.

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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