Tag Archives: Chief Financial Officer

DCC, Dunedin City Treasury and 3 big banks [Interest Rate Swaps]

WHICH THREE BANKS, DCC ??????

Comments received.

Rob Hamlin
Submitted on 2013/12/17 at 3:02 pm

As some of you may recall I have been very interested in DCTL and its large gains and losses on interest rate swaps. The following article http://nz.finance.yahoo.com/news/comcom-issue-proceedings-against-asb-194400510.html describes today’s announcement by the Commerce Commission to investigate ANZ, ASB and Westpac for mis-selling interest rate swaps to farmers – causing massive losses to these borrowers.

My interest has been further piqued by the arrangement between DCTL and three ‘independent’ banks called a ‘secured multi-option note facility’ within which these swaps are sold to DCTL by said ‘independent’ banks. The ‘secured’ as I have mentioned previously involves an ‘on call’ capital commitment by DCC to DCTL that has been deliberately put in place to circumvent Section 62 of the Local Government Act, which specifically prohibits council guarantees to trading companies. At $850 million of capital (which the DCC does not have), this amounts to some $17,000 for every ratepayer in this city – and you are liable for it.

As I have mentioned before, the very large annual fluctuations in gains and losses reported by the DCC due to interest and currency derivative exposure indicates that the DCC, via its $850 million guarantee to DCTL, is very deep indeed into this particular festering pile of poo.

I have lodged an LGOIMA request with the DCC for the identity of the three banks who are in the ‘secured variable rate note facility’ swap fest with DCTL. However, my unofficial sources indicate that the membership may be between 67% and 100% in common with the three banks mentioned in the ‘Stuff” report on large-scale interest rate swap mis-selling – Time will tell. But might be an idea to find the hammer and your piggy bank.

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Russell Garbutt
Submitted on 2013/12/17 at 4:13 pm

Rob, I simply cannot understand the role of the OAG in all of this. The OAG provides auditing services to the Dunedin City Council and is supposedly the watchdog that ensures things are all tickety-boo in City Hall. But as we have already seen in the Kaipara case that the OAG now says that it is terrible that all of this borrowing took place, but that THEY ARE NOT ACCOUNTABLE. Surely to goodness that they have seen the actions of the CFO of the DCC to subvent the point and purpose of Section 62 of the LGA. Equally puzzling is how they have not been warning of the ramifications of these infernal legalised Ponzi schemes as they have been described elsewhere.

I distinctly remember the sacked Athol Stephens explaining to me in his office that many of the financial dealings of the DCC were to avoid tax liabilities. Athol was both a Director of a Council Board and an employee of the Council as I recall at the time.

There is enough smell round this issue to warrant a lot of interest by the OAG and the mainstream media, but sadly it is just too plain in the case of the OAG that they really aren’t interested in pursuing anything that would show that they themselves have been slack and incompetent, nor are they interested in pursuing anything that involves them in any serious work.

In the case of the media, it’s all just too hard. TV simply isn’t capable and is more interested in turning news into entertainment, and the financial reporters in the papers can’t seem to get their heads round anything substantial.

A case of the fox inside the henhouse and another one on the outside, looking out for the farmer.

Posted by Elizabeth Kerr

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Filed under Business, DCC, DCTL, Economics, Name, New Zealand, People, Politics, Project management, What stadium

DCC: New chief financial officer

### dunedintv.co.nz October 14, 2013 – 6:36pm
DCC appoints new chief financial officer
The DCC has appointed the University of Otago’s director of financial services, a former Allied Press accountant, as its chief financial officer.
Grant McKenzie [ODT files]Grant McKenzie has been chosen for the newly created role, with responsibility for the management of the council’s group finances.
A graduate of the University of Otago, McKenzie has a Bachelor of Commerce, majoring in accounting, is a chartered accountant, and a member of the Institute of Directors.
His role will include the provision of financial advice and support to the board of Dunedin City Holdings Limited, which looks after the council’s group of companies.
Ch39 Link

Dunedin City Council – Media Release
Group Chief Financial Officer Appointed

This item was published on 14 Oct 2013.

The University of Otago’s Director of Financial Services, Grant McKenzie, has been appointed as the Dunedin City Council’s Group Chief Financial Officer (GCFO).

Announcing the appointment of Mr McKenzie to this newly-created role, DCC Chief Executive Paul Orders says, “Grant will bring a wealth of knowledge and experience to the role and will be instrumental in ensuring the effective and efficient management of DCC group finances.”

Mr McKenzie is a graduate of the University. He has a Bachelor of Commerce, majoring in accounting, and is a Chartered Accountant. He is also a member of the Institute of Directors.

For the past eight and a half years, Mr McKenzie has been the University’s Director of Financial Services. In this role he has been responsible for the overall accounting function for the University and the wider University group.

Mr McKenzie is a director for several subsidiary companies within the University group, including the University of Otago Foundation Studies Limited, Unipol Recreation Limited and University Union Limited. He is also an elected trustee of the New Zealand University Superannuation Scheme.

Before working at the University, Mr McKenzie was the Group Accountant at Allied Press Limited. He has also worked for Dunedin business advisory firm Taylor McLachlan.

Mr McKenzie says, ”I’m very pleased to have been appointed to the role and look forward to the new challenges ahead.”

The new position of Group Chief Financial Officer replaces the DCC’s Chief Financial Officer (currently a vacant post),with the role expanded to include the provision of financial advice and support to the Board of Dunedin City Holdings Limited (DCHL). The role will also create more cohesive financial management between the DCC and Dunedin City Holdings Limited. Twenty eight applications were received for the position, from New Zealand and overseas.

DCHL Chair Graham Crombie says, “I’m really pleased Grant is joining us and look forward to having his experience and ideas around the table.”

The current position of Chief Executive of DCHL will be disestablished when Mr McKenzie takes up his GCFO role in late January. Mr Crombie says the significant contribution of DCHL Chief Executive Bevan Dodds will be recognised and an appropriate handover arranged.

Contact Chief Executive, Dunedin City Council on 477 4000.

DCC Link

Related Posts and Comments:
21.3.13 DCC: Opportunity created by Stephens’ departure
15.3.13 DCC: Stephens gone. It took way too long.

Posted by Elizabeth Kerr

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Filed under Business, DCC, DCHL, Delta, DVL, DVML, Economics, Media, Name, New Zealand, People, Pics, Politics, Project management, Property, Site, Sport, Stadiums, What stadium

DCC —It took way too long

Received from Russell Garbutt
Fri, 15 March 2013 at 7:49 AM

Well, it seems to have taken a while to happen, but happen it nevertheless has. Until the full wording of the joint statement issued by Paul Orders and Athol Stephens can be studied a little more closely, one can only assume that Mr Stephens has left the Council’s employ in a manner rather similar to that when Jim Harland suddenly found a desire to cease being the DCC CEO on the election of a new Mayor.

While Mr Stephens is quoted as being proud of what he has achieved and rates his time with others in the DCC as being a time of “great progress in the city, that had left the city with a ‘magnificent collection of modern community assets”, others may care to describe his time over recent years in more critical terms. There is no doubt whatsoever that Mr Stephens has, in his role of Chief Financial Officer, fostered, encouraged, or stood by, when financial prudence simply flew out the window. The current level of debt alone is a measure of the financial performance of the City, and while Councillors have the final say in the governance of the City, Mr Stephens occupied a central, crucial role in setting out strategies that resulted in this astronomical growth in debt levels. I don’t think we have yet seen the full extent of the financial dealings that has been carried out behind the scenes. Money has been spent far faster than it has been earned and that money has had to come from somewhere. Whether it has been by the issuing of guaranteed bonds offered at extraordinary rates to still anonymous investors, or by dabbling in the murky, wide-boy areas of interest rate swap derivatives, all this activity has been overseen by Mr Stephens. He has also had a role in overseeing, by his previous membership of a number of Boards of City owned entities, the troubling and frankly stupid practice of borrowing to pay dividends.

It is also illuminating that once again Cr Syd Brown rises to offer the mandatory words of praise. Cr Brown was a major figure in the governance of the Council overseen by Mayor Chin, that was the body ultimately responsible for the financial stupidity that has resulted in “a magnificent collection of modern community assets”. While many would argue convincingly that most of that last Council – indeed most of the current Council – wouldn’t have a clue what was in the papers and reports that was set before them, a small few knew exactly what was happening. Indeed, as I’ve often said before, it took about 20 people in this City to determine to build the new rugby stadium against every indicator that it would be, and remain, a financial disaster, and against the wishes of the wider community. Mr Stephens was one of those 20, as was Cr Brown.

[ends]

### ODT Online Fri, 15 Mar 2013
Council head in quick exit
By Debbie Porteous
Dunedin City Council senior finance manager Athol Stephens has quit and will clear his desk today after the shock announcement yesterday of his departure.
Read more

Posted by Elizabeth Kerr

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Filed under CST, DCC, DCHL, DVL, DVML, Economics, Name, ORFU, People, Politics, Project management, Property, Site, Sport, Stadiums