City Pacific revises guidance on mortgage fund
City Pacific has revised downwards its half-year guidance for the City Pacific First Mortgage Fund.
The company told the Australian Securities Exchange that impairment losses in respect of certain assets of the fund were expected to total approximately $339 million or 35 per cent of total assets prior to impairment.
As well, the company said the project underlying total asset value for the fund was now $630 million, with the expected underlying value of one unit in the fund now being 61 cents.
The company said the main contributors to the impairment losses in the fund had been “the unprecedented events that have severely impacted the global and Australian financial sectors and the consequent limits on the availability of credit".
It said conditions in Australia’s capital and property markets remained uncertain.
The company made the point that the impairments noted in its announcement were recorded in line with accounting rules and did not represent the actual amount lost by the fund.
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