Page 70 - Stellar IAR2015

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (CONTINUED)4. LOAN INVESTMENTSR’000Loan Participation 1The loan was secured by corporate guarantees, cession of book debts, insurance policies and bank accounts, a general notarial bond over movable assets and a subordination of all shareholder and inter-company claims. Interest was serviced quarterly. The loan was re nanced into Loan Participation 3 on 23 April 2015.Loan Participation 2The loan was secured by unlisted shares at a minimum cover ratio of three times the face value of the outstanding amount of debt. Interest was serviced monthly. The loan was re nanced into Loan Participation 4 on 14 August 2015.Loan Participation 3The loan is secured by the pledge and cession in securitatem debiti of the shares in a listed entity, at a minimum cover ratio of two times, and by a corporate guarantee. Interest is serviced monthly. The loan is repayable on or before 31 August 2017.Loan Participation 4The loan is secured by a pledge and cession of shares in an unlisted company and a corporate guarantee. The value of the security is fully covers the loan. Interest is serviced monthly. The loan is repayable on or before 31 August 2017.Short term portion of loan investments Long term portion of loan investmentsInterest RatePrime + 8.5% per annum2% per month26.5% per annum26.5% per annumGroup and Company 201410 23112 000--22 23122 231 - 22 2312015--33 17340 42973 60216 971 56 63173 602Loan syndication agreements have been entered into between Stellar Capital and ASOF, whereby the Company has participated in loans advanced by ASOF to various private entities unrelated to the Company. The credit risk of the loan participations is shared by all syndicated parties in accordance with the proportion of the funding provided by each syndication party. Stellar Capital shares in 19% and 24% of the risks and rewards of Loan Participations 3 and 4 respectively, in equal measure with other participants.Balances are not considered to be past due or impaired at year end. Management have identi ed concentration risk in the loan participations as the ultimate borrowers form part of the same group of companies. The concentration risk was considered before each new individual loan was advanced. The carrying amount of the loan investments is considered to approximate fair value as the current interest rates charged are commensurate with the credit risks associated with each loan and are therefore considered to be market- related. A description of the Group’s nancial instrument risks, including risk management objectives and policies is detailed in note 31.66 | STELLAR CAPITAL PARTNERS