View more on these topics

Tiuta Plc and Connaught Asset Management both enter into administration

Bridging lender Tiuta Plc and one of its primary funders Connaught Asset Management, which operated unregulated collective investment schemes, both entered administration last Friday.

The directors of bridging lender Tiuta Plc stated on Friday their intention to place the firm into administration.

The FSA has confirmed it approved the decision on 11 September but the decision still needs to be approved by the courts. A notice of intention has been filed to make David Rubin & Partners the firm’s administrator although this has not been finalised.

Last month, Mortgage Strategy revealed Tiuta Plc made a pre-tax loss of £37.8m in the 18 months to 30 September 2011.

In a statement from Tiuta it said: “The process has yet to be completed and this step has been taken to preserve the integrity of the underlying business, the reputation of the Tiuta brand and also the lending platform.”

Earlier on Friday, Mortgage Strategy revealed the directors of Connaught Asset Management had placed the company into administration. Two Tiuta subsidiaries, Tiuta International and Tiuta Development Finance, used the Connaught Series 1 and Series 2 Ucis funds to fund their lending. Peter Hollis of KPF Advisory was appointed the administrator on 18 September.

An investor in the Series 1 fund, who wished to remain anonymous, says: “We hope that once they are in insolvency procedures, then we will get to the truth and then we will deal with recovering monies for the benefit of those who invested.”

Earlier this month, Mortgage Strategy revealed 92 per cent of investors voted in favour of placing the £118m Income Series 1 fund, which provided a £105m funding line to Tiuta International, into liquidation.

The Series 1 fund was suspended in March and interest payments were not made. A review was commissioned to ascertain its true value.

Last month, Mortgage Strategy revealed investors faced losses of up to 50 per cent. An independent review by Duff and Phelps suggested recoveries would be between £46.5 and £53.2m of the £105.5m used to fund Tiuta.

A decision to wind down the Series 1 and £18m Series 2 fund was made in June. A £22m Series 3 fund, which was not linked to Tiuta loans, was wound down in July due to a spike in redemptions.

CAM bought Tiuta International and Tiuta Development Finance for a £1 in June. In July, Mortgage Strategy revealed Tiuta International had been placed into administration by CAM.

Recommended

LTV cap would put the brakes on NewBuy, says CML

The Council of Mortgage Lenders has warned the Government it risks jeopardising the success of the NewBuy scheme if it gives the Bank of England’s financial policy committee the power to cap loan-to-values and loan-to-income ratios. Last week, the Government launched a consultation the macro-prudential powers that could be given to the Bank of England’s […]

MS leader: Keep smiling through

The Intermediary Mortgage Lenders Association’s annual bash in September is always a good bellwether for how the industry is doing. In 2007, 2008 and 2009 it was unsurprisingly like attending a wake, with many giving last rites to an industry they judged to be in terminal decline as the economic bad news engulfed not just […]

Frexit & contagion risk in Europe

Many commentators have suggested that the UK’s exit from the European Union will trigger a domino effect, leading to its eventual break-up. Neptune’s Rob Burnett discusses the likelihood of this happening. Read more: Important information Investment risks Neptune funds may have a high historic volatility rating and past performance is not a guide for future […]

Newsletter

News and expert analysis straight to your inbox

Sign up
Comments
  • Post a comment
  • Raphy Stone 21st September 2012 at 5:53 pm

    We have all witnessed the lingering deaths of Connaught and Tiuta. Perhaps someone can enlighten the readership on the exact meaning behind “preserve the integrity of the underlying business, the reputation of the Tiuta brand and also the lending platform.”
    Integrity and reputation would both seem rather tarnished and I would venture to suggest that they have now fallen of this elusive platform!