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« on: September 08, 2014, 07:24:43 am »
Verster explained that the South African Bonds were not trading. “They are part of the suspension, similar to the Common Equity. Some money market funds and income funds have adjusted their evaluation or frozen that part of their portfolio, so some investors, when they request a redemption from an income fund of R100, might get R93 and R7 will be held behind, because that is the African Bank exposure. No one really knows the true value, but I would guess it would be close to 90% of the previous value.” In the whole reorganisation, there’s a good bank and a bad bank, said Verster. “The bad bank gets bought out of Abil at R7bn for R17bn loan book. That leads to an impairment of R10bn in the listed entity, so the listed entity is insolvent.
“There is also a buy-out of the good book of R26bn from the listed entity into a good bank, so there’s an asset of 26. However, the debt holders also go long, which is 90% of R40bn of debt. That is R36bn, so you have 26 of loan book and 36 of the liability. That leaves a 10% funding shortfall. That’s where the consortium of banks are coming in.”
“The banks will want to exit because they are not in the business of owning stakes in other banks,” he said. “The good bank will then list and allow that consortium to be replaced as the shareholder, by public shareholders, so there’s quite a process still to come. In that whole process there is some value attached to the current Abil shares …”
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, if not, you are not worse off. Don't make an issue of it, just do it on the schedule that you lodge together with your return.
