A Sydney-based financial firm linked to a troubled Kiwi insurer remains 'business as usual' and is on the hunt for new equity partners, reinsurers, and independent directors, after it removed two members from its board.
CBL Insurance was placed into interim liquidation on Feb. 23, following an application by the Reserve Bank of New Zealand (RBNZ) to the High Court. The move was prompted by the insurer’s breach of RBNZ’s directions when it paid NZ$55 million to overseas companies despite doubts about its solvency.
Assetinsure – wholly owned by CBL Group’s head company, CBL Corporation – said its capital requirements are separate from the group and that it only has limited exposure to one NZ company through reinsurance.
"For us it is business as usual,” Assetinsure CEO Gregor Pfitzer told The Australian Financial Review. "Assetinsure is independently authorised and regulated by the Australian Prudential Regulation Authority. Its capital requirements are different to those of CBL Group companies and Assetinsure has limited exposure to one New Zealand-domiciled company through some reinsurance."
Speaking about his company’s relationship with the rest of CBL Group, Pfitzer said "the fact some children are behaving badly does not affect the other grown up kids."
"Clearly, we have an interest in distancing ourselves from the overall environment,” the Assetinsure chief said. “The facts speak for themselves. Our insurance business continues to operate normally and we will look to make alternative reinsurance arrangements where appropriate.”
Pfitzer said the talks with new equity partners were well advanced and he is expecting that he’ll be able to announce a new deal soon. He did not provide details as to the parties or timing of the deal.
Another Australian CBL offshoot that was caught in CBL’s troubles was Deposit Power. The national property financial company has collapsed, potentially leaving some 10,000 residential, commercial, and property investors in the lurch over roughly $300 million worth of deposit bonds for current - and pending – deals, the report said.
