SOUTH-west investors are facing a nervous wait to hear if their life savings can be salvaged following news of the collapse of financial services provider Banksia Financial Group.
Customers and clients gathered in disbelief outside the locked doors of the Koroit Street branch in Warrnambool yesterday afternoon as revelations of the company’s $660 million debts emerged.
Banksia Security Limited (BSL) has a large network of branches throughout regional Victoria and also operates in New South Wales and South Australia.
Banksia representatives refused to be drawn into discussions yesterday. However, a spokeswoman confirmed that advisory firm McGrathNicol had been appointed as business receivers.
Warrnambool-based Banksia director Grenville Skewes chose not to respond to questions from The Standard.
“It would not be appropriate for me to be discussing the matter at this time,” Mr Skewes said.
However, in a statement released by receiver McGrathNicol, it was revealed that the company owed $660 million to investors.
“We are in the process of conducting an urgent review of BSL’s financial position, loan book and underlying security properties — our primary concern is to ensure the interests of debenture holders are being protected,” receiver Tony McGrath said.
Company trustee The Trust Company Limited made the decision to appoint receivers following company board concerns that Banksia was nearing insolvency.
“We will focus our attention on ensuring debenture holders are treated fairly and equally. We will communicate with debenture holders openly and will act in their best interests throughout the receivership,” The Trust Company corporate client services manager David Grbin said.
The circumstances around Banksia’s demise are unclear.
Customers were given no warning or explanation about the collapse and struggled to find information as news quickly spread.
It is also unclear just how much money south-west customers have invested in the company.
One Warrnambool man who wished to remain anonymous said his father-in-law had $60,000 with Banksia Financial Group. “His $60,000 matured on Monday and they rolled it over on Tuesday,” the man said. “I just think it’s wrong — they could have said something.”