Comment
Macquarie Group made margin loans to an estimated 600 Storm Financial clients, some of whom were sold out at disastrous loan-to-value ratios.
Unlike Commonwealth Bank, Macquarie Group has not talked about any form of compensation after its margin loan system appeared to break down badly.
Did you receive a Macquarie Group loan through Storm? E-mail swashington@smh.com.au
Under the Storm Financial system, margin lenders - who are supposed to be bound by a responsible lending clause in the bankers’ code of conduct - advanced massive margin loans to pensioners and retirees who had no other sources of income.
When the market collapsed there was a break-down that involved Storm Financial, meaning many of those who held margin loans were sold out when their holdings were worth practically nothing - well past the level they were supposed to be sold out at.
BusinessDay has reported on a Bexley man, Ian Jones, who says his Macquarie margin loan was sold out at a loan-to-value ratio of 97 per cent, when the official level seems to have been a maximum of 85 per cent.
Put simply, if Mr Jones had been sold out at the official level, he would have five times more money than he ended up with.
The official line is that Macquarie Group has ‘‘settled’’ with its clients.
This is news to some of Macquarie’s former Sydney-based clients who report there has been barely any contact by Macquarie, and certainly no talk about compensation.
Macquarie has made a submission to the parliamentary inquiry, which left some pretty basic questions unanswered.
In an attempt to fill the gaps, BusinessDay asked a number of basic questions, but Macquarie is unwilling to answer even the simplest of these questions, arguing it will only make comment once ASIC investigations and the parliamentary inquiry into Storm’s collapse are complete.
Most of the questions are pretty basic. By rights, one might reasonably have expected them to be addressed in the submission to the parliamentary inquiry. They were not.
Now Macquarie is staying silent, giving every impression it wants to slip under the radar. While people like Ian Jones wonder how they are going to rebuild their shattered lives.
swashington@smh.com.au
