S&P prepares for shockwaves
Standard & Poor’s (S&P) is in discussions with Australian funds managers to determine the ramifications of the Lehman Brothers collapse for local investors.
It believes many Australian funds will have exposure to assets associated with the fallen US firm.
The research house has already placed one fund ‘on hold’ following the overnight announcement that Lehman Brothers has filed for bankruptcy.
The Reed Property Trust, which held a ‘three star’ rating from S&P, was placed ‘on hold’ because Lehman Brothers had a 40 per cent stake in the trust’s operator, Reed Property Group Consolidated.
Lehman Brothers had intended to provide the trust with a working capital facility, some of which would be used to underwrite equity in the fund and reduce gearing over the next year.
S&P said it was not currently in a position to determine the impact of the Lehman Brothers collapse on the trust, and that the ‘on hold’ status would remain in place until the group’s ownership structure and the nature of the working capital facility had been clarified.
Another research house, Adviser Edge, also announced that it had placed the Reed Property Trust ‘on hold’, claiming that the loss of the Lehman facility would make it vulnerable to a softening in cap rates or a slowdown in investor inflows.
Recommended for you
Rising advice fees has prompted Radar Results to increase its price guide to a minimum of $3,000 per client to reflect the changing shape of the adviser landscape.
Investment consultancy Ascalon Capital has appointed a new partner, who joins from 20 years at Zenith Investment Partners, as well as a new chief executive amid a “bold new chapter” for the firm.
Despite the perception that short-term market events shouldn’t affect portfolio decisions, Praemium research finds 60 per cent of advisers have made portfolio changes in response to US President Donald Trump’s decisions.
International advice group Findex has appointed a senior individual to spearhead its M&A and growth operations across Australia and New Zealand, seeking to make the brand a household name.
