Diversified industrial company Scales Corporation is unaffected by the receivership of its parent South Canterbury Finance (SCF), it said yesterday, The National Business Review reported. SCF was placed into receivership today after failing to strike a deal with new investors. Scales, which posted an unaudited $10.1m pretax operating profit for the year ending June 30, was one of the bright spots on SCF's books, along with Helicopters NZ and Dairy Holdings.

New Zealand's government has provided NZ$1.6 billion ($1.2 billion) to protect depositors of collapsed South Canterbury Finance and extended a loan of NZ$175 million to the group's receivers to pay off debt, it said on Tuesday, Reuters reported. Privately-owned South Canterbury, one of New Zealand's largest finance companies, announced on Tuesday it could not meet an end-of-the-day deadline to secure new capital and called in receivers.

Japanese Prime Minister Naoto Kan on Monday approved a rehabilitation program for Japan Airlines which is undergoing a state-backed restructuring, Dow Jones Daily Bankruptcy Review reported on an Agence France-Presse story. Transport Minister Seiji Maehara informed Kan about the program a day before the struggling carrier submits it to the Tokyo District Court, government officials said. Maehara told reporters that Kan agreed to the program, but he stopped short of revealing details.

Former glamour funder Strategic Finance, whose directors include ex-All Black captain Jock Hobbs, is in the red to the tune of a shocking $195.5 million, grim news for 13,000 investors, The New Zealand Herald reported. A bleak report issued on the doomed Strategic Finance - in receivership and liquidation - by John Cregten and Andrew McKay of liquidators Corporate Finance revealed the huge deficit which they said was still subject to the cost of receivership and liquidation. The final amount might be more.

Leading political and economic commentators are reminding New Zealanders that a receivership of South Canterbury Finance could actually have positive effects for the economy, TVNZ reported. Brian Gaynor, of Milford Asset Management, said today that he was not "too concerned" about the option of a receivership through statutory management. "There's a lot of nervousness about statutory management or receivership, but the thing about this company is that nearly every investor is covered by a government guarantee so they get their money back.

Korean banks are facing a bumpy road ahead in their move to fix their balance sheets already spoiled by massive defaults in project financing, with a growing number of loans to small- and medium-sized enterprises (SMEs) becoming insolvent, The Korea Times reported. What is of more concern is that banks will have to pile up more loss reserves for loans to SMEs as drastic restructuring slated for October will drive many debt-loaded firms into bankruptcy.

South Canterbury Finance - potentially facing a $1.7 billion receivership tomorrow - yesterday remained hopeful last-minute negotiations would deliver an 11th-hour lifeline to the southern lending giant, the Otago Daily News reported. The Government's role appears increasingly crucial: to pick up part of the debt this week or let South Canterbury Finance sink and pick up the pieces in the months ahead. An outright $1.7 billion receivership of mainly southern-based loans - and subsequent asset fire sales - would have a devastating effect on the South Island's economy.

South Korea will ease mortgage lending rules and extend tax breaks to encourage buyers back to the property market after home sales slumped to the lowest level in almost a year and a half, Bloomberg reported. Banks will be allowed to ease restrictions on mortgage loans for first-home buyers and owners of one residence until the end of March, the government said in an e-mailed statement yesterday. The waiver for taxes on home sales will be extended by two years until the end of 2012, the government said.

Dubai World's willingness to sell prized assets such as ports operator DP World to pay down its debt pile is considered such a drastic move that analysts see it more as a last-resort bargaining tactic. Documents obtained by Reuters this week revealed the surprising news that the debt-laden conglomerate was willing to let go of "strategic assets" such as DP World, Jebel Ali Free Zone and Dubai Maritime City (DMC) as part of a $19.4-billion fundraising effort as it tries to reach a restructuring deal with creditors by October 1.

Allied Farmers is having to renegotiate the terms of its bank facility with Westpac following the receivership of its subsidiary Allied Nationwide Finance, The National Business Review reported. Allied Farmers, which took over the stricken Hanover finance loan book last December, was granted an extension on the Westpac facilities until March next year. However, the receivership of Allied Nationwide has meant that the milestones for the agreed debt terms, including debt retirement and a restructuring initiative, will require renegotiation, the company said in a statement.