NEWS UPDATE: Allco's Max Trust foresees 'significant losses'
Allco Max Securities and Mortgage Trust (MAX) expects to reduce the carrying (or book) value of its $10 million exposure in failed Iceland-based Glitnir Bank to nil, following a downgrade by Standard & Poor’s.
S&P downgraded the rating on Glitnir Bank from CCC (credit watch negative) to D on October 9 after the bank was placed into receivership by the country’s banking supervisor.
A D rating by S&P indicates a belief that there will be a general default and that the obligor will fail to pay all or substantially all of its obligations as they become due.
The bank’s ratings downgrade places “further pressure on portfolio tests in Max’s debt program and increases the likelihood Max will be in breach of its portfolio tests”, according to Allco company secretary Tom Lennox.
“Remedying these breaches would have the effect of requiring further asset sales and further significant realised losses,” he said.
Recommended for you
In this week’s episode of Relative Return Unplugged, AMP chief economist Shane Oliver joins the show to unravel the web of tariffs that US President Donald Trump launched on trading partners and take a look at the way global economies are likely to be impacted.
In this episode of Relative Return, host Laura Dew is joined by Andrew Lockhart, managing partner at Metrics Credit Partners, to discuss the attraction of real estate debt and why it can be a compelling option for portfolio diversification.
In this week’s episode of Relative Return Unplugged, AMP’s chief economist, Shane Oliver, joins us to break down Labor’s budget, focusing on its re-election strategy and cost-of-living support, and cautioning about the long-term impact of structural deficits, increased government spending, and potential risks to productivity growth.
In this episode of Relative Return, host Laura Dew chats with Mark Barnes, head of investment research, and Catherine Yoshimoto, director of product management, from FTSE Russell about markets in Donald Trump's second presidency and how US small caps are faring compared to their large-caps counterpart.
