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Trustees Executors

Level 5 10 Customhouse Quay  PO Box 3222  DX  SP20011  Wellington  New Zealand, PHONE  04-495-0999  FAX 04 - 496-2952



31 March 2014



Canterbury Mortgage Trust – Update

Dear Investor

This letter is an update from our initial communication of September 2013. As Trustee our role is to ensure that we are acting in the best interest of investors. This is why we are exploring all avenues to recover as much money as possible for you, the investor. We want to keep you informed on two specific matters, both of which were common factors in investor correspondence arising from our September letter.

First, we advised you in September that the Trustee had formed a view that it had sufficient information to file a claim against the Manager as a result of the BDO review of loan files. The BDO report examined all loan files where the actual loss suffered by the Fund was more than 10% of the amount advanced. Given the nature of the review, this exercise could only be completed once we were comfortable that the majority of the loan files had been repaid or otherwise closed.

The Trustee has now filed a Statement of Claim in the High Court against Fund Managers Canterbury Limited and others. As the matter is in the hands of the court, we are now unable to comment further on the claim.

Second, the Trustee is continuing to work with the Fund's credit consultant in realising the remainder of the Fund’s loan book. There are now 9 loans left to resolve. These loans are difficult and complex. To sell them quickly would not result in a good outcome for investors. We
are making steady progress with 3 loans resolved since September 2013.

To recap, the current return to investors before taxation adjustments is 83 cents in the dollar. It is unlikely there will be any further payment to investors before the court process is resolved.


We also wanted to tell you that Financial Statements for the year ending 31 March 2013 are now being finalised. The delay was because both these matters needed to be included in the Financial Statement’s disclosure section as “material post balance date events”. A copy will be mailed to you once they have been completed.

Should investors have questions, please write to the Trustee at the address above and we will endeavour to encapsulate responses to those questions in our next correspondence.

We plan to update investors when there has been significant progress or resolution of the matter before the courts, or when we are nearing resolution of the final 9 loans.




Y Mody
Southern Regional Manager

Trustees Executors Limited





Canterbury Mortgage Trust Group Investment Fund, office of the Manager Canterbury Fund Managers Ltd

Unit 6a, 212 Antigua St, Christchurch 8011 • PO Box 13-229, Christchurch 8141
Phone 03 377 5201 •