Brief Thoughts on the SL's Jan-March 2016 Data
My Latest Thoughts after taking into account the SL’s Jan – March 2016 Figures - you may not agree with me
Not a lot of movement from our viewpoint, except for the major advance in the PG situation. We still have 4 loans to go. Total of £70k received from loan repayments/interest and other income. Another £89k paid out in ‘catch up’ payments, Liquidators fees (£324k) and other expenses (£64K), totalling £388k. Returns for Jan – March 2016 were £0.070m. My data is based on GBP, apologies to my DAG Colleagues who invested in other currencies. So still very little movement in ‘Unresolved’ & ‘Unclaimed’ – that’s disappointing. A big step forward (I think) in Kaupthing hf re PG, nothing new on Litigation outwith loans due, and it seems no further forward re payment of ‘contractual interest’.
Remaining 4 loans due total £8.933m as at 31.3.2016.
FX Returns for Jan – March 2016 is +£13.1m, Jan15 was +£13.1m, Jan 2014 was +£14.2m, Jan 2013 was +£13.2m and Jan 2012 was +£15.2m.
‘Unresolved’ around £2.411m + the £1.500m ‘Unclaimed’ = £3.911m at end of March 2016. I had hoped for more movement in the remaining ‘Unresolved’ total in this quarter.
Liquidation costs – Liquidation and other fees so far this year comes to £0.388m
‘Write offs’ still £12.6m. The SL has still to deal with the remaining 4 Loans. 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 another £0.070m so far this year.
The ‘set off’ situation no change, currently £15.2m.
Re the PG – now finalised and agreed at £3.2m. The Composition Kaupthing have agreed with Creditors is 30% of the value of their agreed claim. And as the update from the SL says it will consist of –
· Cash 8.3%
· Shares in Kaupthing 0.5%
· Kaupthing convertible notes 21.2%
So, overall we “should shortly receive cash, shares and notes with a total face value of £960k”. Not a lot of cash but to be honest I was not expecting much back from this source based on all previous information. I presume as the SL says the shares and notes will then be sold in the short term – if he can and at what value - in order to realise value for creditors
As at end of March 2016 data, 4 Loans still due totalling £8.933m. The remaining 4 loans cover GBP (14.5%), Euros (58.7%) and Swiss Francs (26.7%).
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.
Think we have an approx net £9.381m towards interest payments to Creditors as at 31.3.2016, after allowing for Liquidation fees (so far), and 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 (as seen in this Quarterly Report).
Just to re-iterate once more - I said in my previous updates 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 Court to seek directions on the calculation methodology – as per January 2015 Progress report). Some complications have arisen since then over the IOMG Early Payments Schemes and then a further complication arose over a court case in England, regarding repayment of interest once a 100% recovery of Capital had been achieved. The IOMC are reviewing the findings on that case and how it may affect our Liquidation. The case in the IOMC was due to be heard on 28.1.2016. Website to be updated once position clarified (no update so far).
‘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 £5.881m 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). 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 a massive step forward re the PG (I think), but the SL must finalise the loan book now, reach agreement with the remaining ‘Unresolved’ cases (or do what he has to do to finalise it), look at and finalise any Litigation outwith the loan book and now close down the PG part of the Liquidation, in order to meet his hoped for end of year closure of the KSFIOM Liquidation. But, if that is the PG resolved to all intents, everything else now lies within the control of the SL and the IOM Court – I think.
As always take care,
And God Bless,