Loanmakers calls in the administrators

04 February 2009 / by Rebecca Sargent
Loan broker, Loanmakers has been forced to call in the administrators.

Earlier this month the company, formerly known as Debtmatters, announced that it was suspending the trading of shares on AIM while it assessed its financial position.

And, having "carefully considered the financial position and prospects of the company" the board of Loanmakers announced yesterday that it has appointed Dermot Justin Power and Patrick Lannagan of BDO Stoy Hayward LLP to act as administrators of the company.

As a result Charles Stanley Securities has resigned as Loanmakers' nominated adviser and broker with immediate effect.

Prior to the decision, it was clear that Loanmakers had been hit hard by the credit crunch. Chief executive Ges Retcliffe said of Loanmakers' half year report announced in December:

"The results for the first half of the year are disappointing, but these have been caused in large part by worsening economic conditions and the effects of the credit crunch.

"Our largest provider of loans, First Plus, exited the market in August 2008 reducing lending options and other lenders have tightened lending criteria.

"Relations with both lenders and introducers remain positive but given the current economic outlook it is unlikely that trading performance will improve in the second half of the year."

The announcement of administration follows the rejection of an underwritten open offer by shareholders, which according to Mr Retcliffe, "represented an opportunity to inject capital into the business."

If no alternative nominated adviser is appointed before March 4, the admission of Loanmakers' shares to trading on AIM will be cancelled.

© Fair Investment Company Ltd