Wednesday 27 July 2016 by Company updates

IMF loses appeal on ANZ bank fees case


On 27 July, IMF Bentham (‘IMF’) announced that its appeal against the ANZ bank fees case was dismissed

IMF is in the process of considering this judgement and its next steps. If IMF discontinues each of the other related bank fees cases, it will recognise an impairment to the related intangible assets and any increase in adverse costs provisioning to the FY16 financial results. IMF expects that the reduction to FY16 net profit after tax will be no more than $9.5m for the ANZ and other related bank fees matters.

While the appeal loss represents a negative result for IMF, we note that the company remains in an improved financial position since the bond was issued. IMF held $94m of cash versus debt of $50m at 31 December 2015, versus a current cash position of $180m versus debt of $82m, and a further investment in cases of around $40m since 31 December 2015. While IMF’s share price is currently down 6% after the news, its market capitalisation is still around 15% higher than at the time of bond issue in March 2016 ($258m currently vs $226m at bond issue).

A link to the announcement is available here.External link - opens in a new window

The IMF Bentham 7.40% AUD bond maturing in June 2020 is currently indicatively offered at a yield to worst* of 6.40%.

Please contact your FIIG representative for further information on the IMF Bentham AUD bonds. Available to wholesale investors at a minimum face value of AUD10,000.

*In this instance, the yield to worst represents the yield to maturity