It’s amazing how fast time goes by. It was in Global Pacific's April 2007 monthly newsletter that we first mentioned the concerns in the U.S economy, which became known as the sub-prime crisis, and which eventually led to the worldwide financial meltdown that occurred when Lehman Brothers filed for bankruptcy on 15 October 2008.
It’s interesting to look back on what’s happened to the financial markets in New Zealand since then. The initial shock wasn’t too bad. But when globally banks stopped lending to each other, and the commercial paper markets in the U.S. and the U.K. ceased to function completely, there was almost a month when New Zealand banks could not raise any cash in the offshore markets
Actually things started going bad in the finance sector here well before that. It started in May 2006 when the first finance company, National Finance, collapsed. Then in July 2007 there was the big one, Bridgecorp, and by the end of September 2007 ten finance companies had disappeared.
One of the most badly affected sectors of the economy was small to medium sized businesses - or SMEs as they are commonly known. SMEs make up a huge part of the New Zealand economy. And they are notoriously hard to finance.
Unless you can show a strong track record of profitability and cash flow for the last three years, and proper sets of accounts, banks are not particularly interested in lending to SMEs. And then they usually want additional security over your house or other property.
Other than the banks, the finance companies were the major sources of finance for people wanting to buy businesses. Now they are no more or have ceased lending to businesses.
Well the good news is at Global Pacific we do have access to finance for SMEs and larger businesses. So in this - our first contribution to the ABC Business newsletter - we’d like to tell you about Global Pacific and what we do.
Our web site describes our business and the people involved - click here to view.
WHAT WE DO
Our business is advising on and arranging all forms of debt and equity finance for all forms of property and business.
We are an independent firm of commercial finance brokers with access to all the banks, prime lenders and specialised financiers in New Zealand. We function like a real estate agency firm where the individual members operate independently with their own clients, but share in the experience of us all.
In all cases our clients know they need the money but are often not sure what form it should take. We’re also seeing clients looking for the wrong sort of finance. So our service and expertise is not only obtaining the funds for you but also advising on the type that best suits your circumstances.
Our fees are success based payable on the satisfactory delivery of a previously agreed and mandated proposal. In other words;
• we work with you on the type of finance you require,
• report back to you on the conditions under which we believe we can obtain it,
• receive a mandate from you to proceed which specifies those conditions and our fees,
• and only once a firm proposal is received incorporating those conditions does our fee become payable.
In the next ABC newsletters we’ll keep you up to date on how to finance business and tell you the most important things lenders are looking for.
In the meantime you can get more information by phoning us on 09 303 3700 or you can enquire online here. In either case tell us you read about our services through ABC Business.
