Thousands of investors are facing hundreds of millions of dollars in losses after the shock bankruptcy of Banksia Financial Group. According to news.com.au, thousands of Victoria residents had their deposits frozen after the collapse of the group.
About 3000 investors in eight towns and cities in regional Victoria, including Greek=Australians, have had their investments put on hold while receivers McGrath Nicol work their way through the non-bank lender’s accounts. About 100 workers also are set to lose their jobs.
Kyabram District Plan Group member and accountant Peter Nelson, whose firm shares an office building with Banksia’s now-closed transaction center, said there may be hope for investors to recoup at least some of their cash, given that Banksia’s advances were secured by first-ranking property mortgages.
Nelson, himself a Banksia investor, said everyone from retirees to sporting clubs and schools in the Goulburn River Valley region had money in the firm, describing it as a financial icon in the region that has built a strong reputation since forming in the 1960′s. Kyabram resident Jason Dunn said the town was reeling.
“People are in tears,” he said. He said many locals feared they would lose their retirement fund. “People who worked hard all their life have just lost the lot. It’s really going to affect the town. It’s a black day here,” he said. The pastor of Kyabram Baptist Church, Robert Arnold, said it was likely the church would lose money.