Brief Thoughts on the SL's April-June 2016 Data
My Latest Thoughts after taking into account the SL’s April – June 2016 Figures - you may not agree with me
Is the eight-year long game of chess nearly over. One loan down, 3 to go. Have the Cash back from the PG, £297k, but no word on the Kaupthing Shares or the Convertible Notes from the PG. Thought we were due them at the same time. Have asked previously to this report re the PG situation – no reply from the SL. And the SL now seems near to getting guidance from the IOM Court re payment of ‘contractual interest’. Total of £1.0m received from loan repayments/interest and other income for April – June 2016. Another £46k paid out in ‘catch up’ payments, Liquidators fees/expenses (£31k), totalling £419k this year. My data is based on GBP, apologies to my DAG Colleagues who invested in other currencies. So little movement in ‘Unresolved’ & ‘Unclaimed’ – that’s disappointing (to me anyway). Another step forward in Kaupthing hf re PG, but need info on the Kaupthing Shares & Convertible Notes. We seem to be a bit further forward as regards ‘contractual interest’, which would be great but nothing new on Litigation outwith loans.
Remaining 3 loans due total £8.364m as at 30.6.2016. These loans cover GBP (12.9%), Euros (52.1%) and Swiss Francs (33.8%).
FX Returns for Jan – June 2016 is +£13.5m, Jan15 was +£13.1m, Jan 2014 was +£14.2m, Jan 2013 was +£13.2m and Jan 2012 was +£15.2m.
‘Unresolved’ around £2.365m + the £1.500m ‘Unclaimed’ = £3.865m at end of June 2016.
Liquidation costs – Liquidation and other fees so far this year comes to £0.419m
‘Write offs’ still £12.6m. SL said in Jan 2016 Progress Report that he hoped for between another £1.2m-£2.1m more from the loan book. He has brought in £1.070m so far this year Inc interest, so getting there. When does he say enough and close down what’s left.
The ‘set off’ situation no change, currently £15.2m.
The PG was finalised and agreed at £3.2m. The Composition Kaupthing agreed with Creditors was 30% of the value of their agreed claim. And the SL said it would consist of –
· Cash 8.3% - SL now saying we received the £297k
· Shares in Kaupthing 0.5% - no word of this in the 30.6.2016 Report
· Kaupthing convertible notes 21.2% - no word of this in the 30.6.2016 Report
So, overall we have received the cash and do not know if we have received the remainder yet. – A question to ask the SL once again. I presume, as the SL has said previously the shares and notes will be sold in the short term once he has received them – if he can and at what value - in order to realise value for creditors.
The SL stated in the Jan 2016 Progress Report that the Liquidation might end within 12 months – dependent upon the loan Book, ‘Unresolved’, Litigation & PG situation. The PG update, while miniscule in value – is good news with regard to reaching an end to this Liquidation, as is one loan less.
Think we have an approx net £10.775m towards interest payments to Creditors as at 30.6.2016, after the Liquidation fees (so far), and allowing for the remaining ‘Unresolved and ‘Unclaimed’ claims. If no more cash comes in we will continue to incur Liquidation Expenses plus other fees thus lowering any amount available for distribution.
To re-iterate once more - we need 0.4% or around £3.5m to pay the initial contractual interest. Creditors entitled to contractual interest in excess of 5% would receive the amount due in excess of 5% up to the 8.10.2008. Creditors not entitled to contractual interest would receive 4% on amounts owed up to 8.10.2008. This amount would be small as the relevant creditors are typically trade creditors; the total value of such claims is low. Once the above two steps have been completed all creditors will have received their interest entitlements up to 8.10.2008. In respect of further interest payments, JLs (as was) applied to the IOM Court to seek directions – as per January 2015 Progress report). Although not yet resolved it appears we are now further forwards as SL hopes to make a further announcement on the website shortly.
‘All Creditors would’ (then) ‘receive interest at 4% pa’. ‘Paying this interest to creditors could amount to up to £36.2m per annum, but would of course be limited by the extent to which cash was available’. Quoted data taken from JLs info in January 2013 update. Currently may have approx £7.275m towards this.
Also as noted in the JLs January & July 2015 Progress Reports and the SL’s January 2016 Progress Report - that it was intended that one further dividend would be paid to creditors in respect of each class of interest, timing and amount would depend on realisation of remaining assets. To me that meant Loan Book, ‘Unresolved’, Litigation and PG.
Re – Life Insurance Policies (Bondholders). Appears no change here, although the SL has done his best to help regarding this situation, it appears some Bondholders still await clarification from their Life Companies on whether or not to allow Bondholders to deal directly with the SL on any future payments.
So getting there, but the SL still has to finalise the loan book, reach agreement with the remaining ‘Unresolved’ cases (or do what he has to do to finalise them), look at and finalise any Litigation outwith the loan book and clarify the remaining two parts of the PG situation, in order to meet his hoped for end of year closure of the KSFIOM Liquidation. But, if that is the PG resolved, everything else now lies within the control of the SL and the IOM Court – I think.
As always take care,
And God Bless,