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ASSET REVIEW?
Ah! the typical way that B/T communicates with unit holders - via the press release - the management of the manager seems to struggle with the idea that it should communicate with us in the first person. I'd guess unit holders have come to expect no better than this from B/T. Maybe B/T should go back to university (if they have degrees) and redo 'Communication Skills'.
So, they've had this asset review for some time - where is it? Seems good enough to give a spiel to the media, but not good enough to give a report to unit holders.
I do not like this manager, B/T.
Here is the media release (remember, this is how B/T are disclosing information to unit holders, no 'This is your Captain speaking.. ", just a media release) {I have inserted comments within the media release}
"... Asset review reveals need for Pacific First Mortgage Fund write-down
Following a review of the assets of the Pacific First Mortgage Fund (Fund) in conjunction with auditors (KPMG), the gross assets have been written down by $448.9 million for the 12 months to June 30, 2009. Gross assets in the Fund now stand at $521.1 million. This write down represents an additional impairment of $108.9 million from the written down value as at 31 December 2008 which was $630.0 million.
Comment:- yet this doesn't seem to have included second mortgages down at Martha Cove - mortgages that the auditors (KPMG) express a mere 'material uncertainly' about - is B/T acting in our best interests? Are the auditors acting in our best interests - should have KPMG criticized KPMG for not impairing those loans? I think it should have.
We should not have been saddled with KPMG again - the fund should have had a new auditor, and the legal review should have included KPMGs past interactions with the fund. It's puzzling that the 'Compliance Report' criticizes City back in 2007 - 2008, however no complaints seem to have be registered for that period, at least that we've seen.
KPMG should be gone, and they should be 'legally reviewed'.
Rodger Bacon and Andrew Griffin, joint chief executives of the Fund's investment manager BalmainTRILOGY, agreed that the additional write-down was "inevitable but extremely disappointing" for unitholders. Based on these revised accounts, the net tangible assets (NTA) stand at $0.48 a unit.
Comment:- huh? I would have thought it was obvious and a tad overrated. I'm still getting over how B/T managed to come up with $0.48 - when do we get the new surprise that will be more of 'inevitable but extremely disappointing'?
The NTA takes into account the $91 million owed to the Commonwealth Bank of Australia as at 30 June 2009. Since then and following some asset sales the Fund has been able to repay further $8.7 million on 31 August 2009 to reduce the outstanding loan to $82.3 million.
Comment:- Well, we'd better hope that the NTA takes into account the $60m owing to Fortress. If it doesn't, then the fund is worth at least $60m less.
Andrew Griffin said: "The negotiations with the Commonwealth Bank are nearing conclusion and an announcement in respect of an extended facility should be made soon."
Comment:- yes, kowtowing back to the same tired old entity that was happy to loan the fund $90m at a time when the fund was incapable of repaying the $150m it already owed - the relationship between City Pacific Limited and the CBA has been a disastrous one for members of the FMF. This manager should have sought a new source of finance, and it should have included the CBA's interactions with the fund in its 'legal review'.
The Australian Securities and Investments Commission (ASIC) had previously extended the deadline to lodge the Fund's annual accounts to November 15. On lodging the annual accounts, Rodger Bacon said: "The write-down highlights the woeful performance of City Pacific which was RE of the Fund for that entire period. More disappointingly the biggest part of this write-down is attributable to loans to related parties of City Pacific.".
Well, I've been looking at Mirvac's Funds (that's Balmain's partner is Mirvac Aqua), and they haven't performed very well at all either - Mirvac had to do a takeover deal to get the fund's price up from $0.50 to $0.60 - these shares were trading at a $1.50 - so, not startling either).
The Mirvac Aqua funds (in which Balmain is a partner) still remain frozen without any communication from their manager since 1 October 2009, and investors have been waiting for months for the manager to disclose a 'strategy' to resolve the difficulties - a strategy promised for months and months but which has not been forthcoming.
By the way, how is Trilogy's own stellar fund performing? - the fund is conservatively run and there are no losses - Their Mortgage Income Trust seems to have converted mortgage loans to cash at the end of the year - its balance has dropped. I wonder if the cash went back to investors or was re-invested. While the fund is well run, Trilogy hasn't shown that they're able to grow the trust, in fact, quite the opposite.
http://www.trilogyfunds.com.au/site/assets/files/TFMIT%20Annual%20Report%202009%20V6%20_%20Website.pdf
Trilogy is not charging unit holders in their Mortgage Income Trust much of a management fee, but it is charging a heap of fees to borrowers from their trust - oh! by the way, I'll ask the question again "is B/T charging 'direct fees' to borrowers in the PFMF?'
No good signs from Balmain or Trilogy either.
Andrew Griffin said: "The strong property and debt markets that preceded the Global Financial Crisis did much to hide the damage that was already being inflicted on the Fund by City Pacific. The honeymoon ended abruptly when the markets turned and it is only now that we can see the extent of the harm that City Pacific caused. We do, however, believe that with the removal of the previous conflicts and with the benefit of significantly greater management resources that the worst for unitholders is over. The rebuilding of the Fund can begin in earnest."
Comment:- Is the worst over? How about the Martha Cove loans? and why KPMG's comment re:material uncertainly?
'the honeymoon ended abruptly'? what do they mean?
'The rebuilding of the fund can begin in earnest?' - huh? So, where is the unit holder's vote promised by Mr. Griffin?
He added: "Although we are mindful that some investors might support an acceleration of sales, notwithstanding the significant discounts that would result, it is critical that some of the Fund's resources are allocated to improving existing assets. This will ensure that these assets achieve an improved return for the PFMF and consequently the value of the Fund is at least maintained and potentially enhanced."
Comment:- how about this? Unbelievable from the man who gave the great speech in the BRW (20 August 2009) about giving members of the fund the opportunity to decide what the future of the fund will be. Yes, there are those who want the fund wound down, and that would be brought to a meeting of members to make a choice. Ah! the drip from the cash cow is in the manager's arm - things change - things are different.
As part of its commitment to ensure that unitholders are closely informed as to the management of Fund, BalmainTRILOGY are in the process of bedding down the Investor Committee. More than 300 unitholders have expressed interest in being on the 10 person Committee (including an independent chairman), with the auditors expected to announce the successful candidates by early December so the first meeting can be held before Christmas.
Comment:- So, this committee will be 'announced by KPMG', the very entity that presided over the period of the decimation of our savings. What the hell goes on in B/T's minds. They need an Investor committee to closely inform us? They have their website - not much there. there is the media, yes, drip feeds there - what could possibly change with an investor committee selected by KPMG?
The Investor Committee in the PIF (MFS) fund has been a disaster, don't expect anything more from a manager who doesn't tell us much anyway.
BalmainTRILOGY was also in the process of formulating a hardship policy in accordance with ASIC guidelines. Bacon said: "We appreciate there are some genuine hardship cases among unitholders. The difficulty has been reaching agreement regarding access to funds and finding a legal solution to the constitution problems that require a redemption price of $1.00 per unit to deliver the funds to unitholders.
Comment:- They could pay you at $1.00 - they're just stalling - they don't have the money anyway - after they take their cut, all the expenses are paid, the CBA and Fortress take their cuts, there is nothing left - live in hope, wallow in mire.
If they pay everyone at the same rate $1.00 - then it's fair.
In fact, if they pay at a V.U.P. and the price changes (up or down), which it will, then that's unfair.
"We are hopeful of having a solution in the near future for those unitholders with genuine hardship situations." ..."
Ah! the typical way that B/T communicates with unit holders - via the press release - the management of the manager seems to struggle with the idea that it should communicate with us in the first person. I'd guess unit holders have come to expect no better than this from B/T. Maybe B/T should go back to university (if they have degrees) and redo 'Communication Skills'.
So, they've had this asset review for some time - where is it? Seems good enough to give a spiel to the media, but not good enough to give a report to unit holders.
I do not like this manager, B/T.
Here is the media release (remember, this is how B/T are disclosing information to unit holders, no 'This is your Captain speaking.. ", just a media release) {I have inserted comments within the media release}
"... Asset review reveals need for Pacific First Mortgage Fund write-down
Following a review of the assets of the Pacific First Mortgage Fund (Fund) in conjunction with auditors (KPMG), the gross assets have been written down by $448.9 million for the 12 months to June 30, 2009. Gross assets in the Fund now stand at $521.1 million. This write down represents an additional impairment of $108.9 million from the written down value as at 31 December 2008 which was $630.0 million.
Comment:- yet this doesn't seem to have included second mortgages down at Martha Cove - mortgages that the auditors (KPMG) express a mere 'material uncertainly' about - is B/T acting in our best interests? Are the auditors acting in our best interests - should have KPMG criticized KPMG for not impairing those loans? I think it should have.
We should not have been saddled with KPMG again - the fund should have had a new auditor, and the legal review should have included KPMGs past interactions with the fund. It's puzzling that the 'Compliance Report' criticizes City back in 2007 - 2008, however no complaints seem to have be registered for that period, at least that we've seen.
KPMG should be gone, and they should be 'legally reviewed'.
Rodger Bacon and Andrew Griffin, joint chief executives of the Fund's investment manager BalmainTRILOGY, agreed that the additional write-down was "inevitable but extremely disappointing" for unitholders. Based on these revised accounts, the net tangible assets (NTA) stand at $0.48 a unit.
Comment:- huh? I would have thought it was obvious and a tad overrated. I'm still getting over how B/T managed to come up with $0.48 - when do we get the new surprise that will be more of 'inevitable but extremely disappointing'?
The NTA takes into account the $91 million owed to the Commonwealth Bank of Australia as at 30 June 2009. Since then and following some asset sales the Fund has been able to repay further $8.7 million on 31 August 2009 to reduce the outstanding loan to $82.3 million.
Comment:- Well, we'd better hope that the NTA takes into account the $60m owing to Fortress. If it doesn't, then the fund is worth at least $60m less.
Andrew Griffin said: "The negotiations with the Commonwealth Bank are nearing conclusion and an announcement in respect of an extended facility should be made soon."
Comment:- yes, kowtowing back to the same tired old entity that was happy to loan the fund $90m at a time when the fund was incapable of repaying the $150m it already owed - the relationship between City Pacific Limited and the CBA has been a disastrous one for members of the FMF. This manager should have sought a new source of finance, and it should have included the CBA's interactions with the fund in its 'legal review'.
The Australian Securities and Investments Commission (ASIC) had previously extended the deadline to lodge the Fund's annual accounts to November 15. On lodging the annual accounts, Rodger Bacon said: "The write-down highlights the woeful performance of City Pacific which was RE of the Fund for that entire period. More disappointingly the biggest part of this write-down is attributable to loans to related parties of City Pacific.".
Well, I've been looking at Mirvac's Funds (that's Balmain's partner is Mirvac Aqua), and they haven't performed very well at all either - Mirvac had to do a takeover deal to get the fund's price up from $0.50 to $0.60 - these shares were trading at a $1.50 - so, not startling either).
The Mirvac Aqua funds (in which Balmain is a partner) still remain frozen without any communication from their manager since 1 October 2009, and investors have been waiting for months for the manager to disclose a 'strategy' to resolve the difficulties - a strategy promised for months and months but which has not been forthcoming.
By the way, how is Trilogy's own stellar fund performing? - the fund is conservatively run and there are no losses - Their Mortgage Income Trust seems to have converted mortgage loans to cash at the end of the year - its balance has dropped. I wonder if the cash went back to investors or was re-invested. While the fund is well run, Trilogy hasn't shown that they're able to grow the trust, in fact, quite the opposite.
http://www.trilogyfunds.com.au/site/assets/files/TFMIT%20Annual%20Report%202009%20V6%20_%20Website.pdf
Trilogy is not charging unit holders in their Mortgage Income Trust much of a management fee, but it is charging a heap of fees to borrowers from their trust - oh! by the way, I'll ask the question again "is B/T charging 'direct fees' to borrowers in the PFMF?'
No good signs from Balmain or Trilogy either.
Andrew Griffin said: "The strong property and debt markets that preceded the Global Financial Crisis did much to hide the damage that was already being inflicted on the Fund by City Pacific. The honeymoon ended abruptly when the markets turned and it is only now that we can see the extent of the harm that City Pacific caused. We do, however, believe that with the removal of the previous conflicts and with the benefit of significantly greater management resources that the worst for unitholders is over. The rebuilding of the Fund can begin in earnest."
Comment:- Is the worst over? How about the Martha Cove loans? and why KPMG's comment re:material uncertainly?
'the honeymoon ended abruptly'? what do they mean?
'The rebuilding of the fund can begin in earnest?' - huh? So, where is the unit holder's vote promised by Mr. Griffin?
He added: "Although we are mindful that some investors might support an acceleration of sales, notwithstanding the significant discounts that would result, it is critical that some of the Fund's resources are allocated to improving existing assets. This will ensure that these assets achieve an improved return for the PFMF and consequently the value of the Fund is at least maintained and potentially enhanced."
Comment:- how about this? Unbelievable from the man who gave the great speech in the BRW (20 August 2009) about giving members of the fund the opportunity to decide what the future of the fund will be. Yes, there are those who want the fund wound down, and that would be brought to a meeting of members to make a choice. Ah! the drip from the cash cow is in the manager's arm - things change - things are different.
As part of its commitment to ensure that unitholders are closely informed as to the management of Fund, BalmainTRILOGY are in the process of bedding down the Investor Committee. More than 300 unitholders have expressed interest in being on the 10 person Committee (including an independent chairman), with the auditors expected to announce the successful candidates by early December so the first meeting can be held before Christmas.
Comment:- So, this committee will be 'announced by KPMG', the very entity that presided over the period of the decimation of our savings. What the hell goes on in B/T's minds. They need an Investor committee to closely inform us? They have their website - not much there. there is the media, yes, drip feeds there - what could possibly change with an investor committee selected by KPMG?
The Investor Committee in the PIF (MFS) fund has been a disaster, don't expect anything more from a manager who doesn't tell us much anyway.
BalmainTRILOGY was also in the process of formulating a hardship policy in accordance with ASIC guidelines. Bacon said: "We appreciate there are some genuine hardship cases among unitholders. The difficulty has been reaching agreement regarding access to funds and finding a legal solution to the constitution problems that require a redemption price of $1.00 per unit to deliver the funds to unitholders.
Comment:- They could pay you at $1.00 - they're just stalling - they don't have the money anyway - after they take their cut, all the expenses are paid, the CBA and Fortress take their cuts, there is nothing left - live in hope, wallow in mire.
If they pay everyone at the same rate $1.00 - then it's fair.
In fact, if they pay at a V.U.P. and the price changes (up or down), which it will, then that's unfair.
"We are hopeful of having a solution in the near future for those unitholders with genuine hardship situations." ..."
