Story image

NZ Superfund spent $150,000, so far, in legal fees in Portuguese banking case

26 Feb 2015

The New Zealand Superannuation Fund has so far spent about $150,000 in legal fees as part of its case to overturn a decision by the Bank of Portugal to move the fund's US$150 million investment into a "bad bank", thereby voiding its insurance on the investment.

The sovereign fund has written off the value of its investment after the Portuguese central bank decided to place the Goldman Sachs-organised loan to Bank of Espirito into the "bad bank" part of BES rather then the new state-supported "good bank" it set up following a reorganisation. The Superfund is among noteholders contesting the decision, which reversed an earlier ruling by the central bank.

"We can't forecast total cost," Superfund chief executive Adrian Orr told reporters after appearing before parliament's commerce select committee. "What I can say is we will be sharing our cost and with confidence around the case we should also have some cost repaid back to us when successful. The spending we have done to date has been around 60,000 British pounds in terms of getting our legal cover and around $30,000 so this is not a cheap exercise.

"If found to be correct we would get all of the money back," Orr said. "We are very confident."

The Superfund has had similar investment strategies worth more than $1 billion over the past five years, regularly using credit default swap insurance, and all have worked "exactly as anticipated", Orr said. The fund currently has no exposures structured in a similar way to the Goldman Sachs-organised loan, where bonds were issued through a finance vehicle called Oak Finance Luxembourg.

A preliminary review by the Superfund's risk compliance unit, which was tabled at a board meeting last week, found the fund's managers didn't overstep their authority or move outside of investment policies when they decided to make the Portuguese investment, Gavin Walker, chairman of the Guardians of New Zealand Superannuation, which governs the Superfund, told the select committee.

The fund is still considering what it has learnt from the process, he said.

"We will probably have some refinements around our process. They won't be material in nature," Walker said.

Adobe, Microsoft and LinkedIn join forces to accelerate account-based experiences
“With these new account-based capabilities, marketing and sales teams will have increased alignment around the people and accounts they are engaging.” 
Winners of 2019 Adobe Experience Maker and Marketo Revvie Awards announced
The Adobe Experience Maker Awards recognise Adobe Experience Cloud customers and partners.
Adobe opens up marketing opportunities with Roku
Adobe and streaming TV platform Roku are now offering Adobe customers the ability to precisely target consumer audiences moving to over-the-top content (OTT).
Adobe Summit kicks off the future of customer experience in Las Vegas
“Today, at Adobe Summit, we unveiled significant new capabilities in Adobe Experience Cloud, including the introduction of Adobe Commerce Cloud and Marketo Engage, and general availability of Adobe Experience Platform.”
Interview: CloudBNE's world of AR, AI, and geospatial tech
“In New Zealand I used to hear, ‘we are so small; the market isn’t big enough…’ I often hear the same thing in Australia and even through parts of Asia.  Could we have launched CloudBNE in New Zealand? absolutely.”
NZ's aged care population held back by digital divide
Aged care facilities are slow to provide WiFi access for residents, and interviewees said they would like to see aged care operators provide more support.
‘Buy-now-pay-later’ taking consumer markets by storm
A new survey shows that young people are embracing this new method of purchasing, with over 1.5 million users in the last year in Australia alone.
Better data management: Whose job is it?
An Experian executive’s practical advice on how to structure data-management roles within a modern business environment.