NZX takes softer line with rebel finance firms
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The Stock Exchange appears to have taken a step back on its battle with listed finance companies to make certain information public.
Last Friday NZX asked all its listed finance companies, or listed companies with significant finance arms, to provide “material” information about the state of their finances.
It wanted monthly updates on several matters including: the reinvestment rate of investors for the month to date; the debt being serviced for the month to date; the anticipated income for the following month.
Several of the 12 companies which responded rejected the request, or qualified the kind of information they were prepared to divulge.
Others were in receivership.
Today the NZX said it would continue to encourage the firms to meet their obligations and to release a regular set of “operating metrics,” even if the metrics did not apply to all.
“The goal was to ensure continuous disclosure was intact,” NZX chief executive Mark Weldon said in a statement to NZPA.
“All companies are engaging with NZX - some by providing such information, some by indicating that the information is not material to their business model.
“However, there has been no ‘action’ that would require disciplinary action at this stage.”
Mr Weldon acknowledged comments that some of the information requested might not apply to some firms, or be calculated differently by different firms.
Reinvestment rates “may be material if that is your only source of funds, but if you are raising wholesale money, have committed bank lines, etc, then it is not so.”
Some firms also complained that they were already subject to continuous disclosure rules, unlike the unlisted sector.
In response, the NZX has called on the Securities Commission and finance company trustees to require a similar level of disclosure from unlisted finance companies.
It pointed out that its request was just a subset of information that was also reported to Trustees and the Reserve Bank by both listed and unlisted finance companies.
By NZPA
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