Bank’s crash may hit NZI

Press, 9 November 1988, Page 45

Bank’s crash may hit NZI

PA Auckland NZI Bank’s profitability may be further slashed if, as believed, it is exposed to the collapsed Western Australian merchant bank, Rothwells. NZI Bank is due to release its interim result this week. The “Australian Financial Review” yesterday named NZI Broadlands as one of the failed merchant bank’s major creditors — to the tune of between sAust7oM and sAustlooM (SNZ93M to SI33M). NZl’s Don Clark, however, would not comment on the company’s involvement in Rothwells. “It would indeed be nice for the market to know, but it is not my practice to comment on individual clients’ accounts,” he said. According to the “Financial Review,” NZI Broadlands is believed to have security over Rothwell founder Mr Laurie Connell’s personal assets, after Mr Connell mortgaged much of his personal wealth after the sharemarket crash in October. Mr Connell will lose one of his best personal assets, a 50 per cent stake in gold-mining company, Paragon Resources, Nl, to

recover the sAustlooM (SNZI33M) loan to Standard Chartered Australian Bank. Other creditors include Sir Ron Brierley and Bruce Judge, along with Kerry Packer, Larry Adler, Robert Holmes a Court, and John Elliot. They placed sAustl7oM (SNZ227M) to save Rothwells from collapse after the crash. Meanwhile, in Australia the National Companies and Securities Commission (NCSC) is taking a “very keen” interest in whether Rothwells’ directors neglected their fiduciary duties. "Auditors certainly have to look at that, or information which may lead to conclusions about the officers of companies, and so do liquidators,” the deputy chairman of the NCSC, Mr Charles Williams, said. “Where we are now is in taking a very keen interest in the conduct of the officers of the companies involved,” Mr Williams told a Perth radio station. “They have some heavy responsibilities upon them ... in relation to acting honestly and for the good of the company,” he said.