Total savings 'refund unlikely'

The administrator recommended an orderly run down

Presbyterian Mutual Society members are unlikely to get all their money back, its administrator has said.

Arthur Boyd has written to 9,500 PMS members, which went into administration in November, recommending "an orderly run down" of its business over time.

He said this would mean part of the members' investments would be repaid.

Mr Boyd said if the proposals were rejected the PMS would have to go into liquidation and members were likely to receive less this way.

His proposals, and voting papers, were posted so as to arrive with members by Thursday.

More than 50% have to back the plans, with a vote deadline of noon on 30 January, for them to go forward.

Mr Boyd said that despite talks with interested parties there had been no offers to purchase or invest in the society.

It is too early in the process for me to say how much of the investment will be paid out and when repayments will be made

Arthur Boyd
Administrator

He said while its assets "had not disappeared", the reality was that the collapse in the UK property market had significantly reduced the value of the PMS' commercial property portfolio and the value of its security over property in its loan book.

"It is too early in the process for me to say how much of the investment will be paid out and when repayments will be made," he said.

Mr Boyd said a formal arrangement would leave the door open for the Society to continue in some form or other in the future should the members desire it.

He said �21m was paid out to members in October, leaving only �4m in the Society's bank account and that between then and November further requests for withdrawals exceeded �50m.

The Society's holdings in commercial property were valued at about �92m in current market conditions compared with a value of �129.5m placed on them in the Society's 2008 annual report.

The society had advanced �184m in loans and Mr Boyd said he was continuing his assessment of various aspects of loans, including the value of property given as security for loans.

He also said that from his review of the Society's loan book it appeared that arrears were increasing because of the current economic climate.