Members agree to run-down of Presbyterian society

SAVERS WHO invested thousands of pounds in the Presbyterian Mutual Society have voted overwhelmingly in favour of an orderly run-down of the church company.

This will not guarantee that the 9,500 members of the society will receive all or a percentage of the money they originally invested in the company.

The society, which was exclusive to members of the Presbyterian Church, was plunged into crisis last November following a run on its funds.

Although it had assets totalling an estimated £300 million, it was forced into administration because it could no longer meet the demands of its members to withdraw their money. The society had invested heavily in property.

The mutual society, which was started by Presbyterians in 1982, was not regulated by the UK’s Financial Services Authority and was not protected under the UK treasury’s bank guarantee scheme.

The administrator appointed to the Presbyterian Mutual Society, Arthur Boyd, revealed that more than £184 million of its assets were tied up in loans to members, while it had nearly a further £130 million worth of assets in commercial property and other investments.

Mr Boyd estimates the value of the society’s commercial property assets have plummeted by £37 million in less than a year.

Investors in the church society have this week received letters from Mr Boyd informing them that more than 90 per cent of members supported his proposal to wind down the society over a period of time.

Church savers have petitioned the British prime minister Gordon Brown to help them by extending the bank guarantee scheme to cover the Presbyterian Mutual Society.

Politicians in the North have also appealed to Mr Brown to come to the aid of the society’s investors and savers.

The administrator of the society has told its members that he now intends to “consider and prepare a proposal for an arrangement to enable an orderly run-down over time”.

“I will be continuing the ongoing work of collecting in outstanding monies and progressing my report to the Department of Trade and Industry concerning the conduct of the society’s directors,” he said in his letter to the society’s members.

Mr Boyd has proposed reporting to the members again by the end of May, by which time he hopes to put a “detailed proposal for an arrangement” to them.