Concern is growing about the future value of life settlement policies held by thousands of Keydata clients invested in Lifemark if proposals for a rescue plan are not finalised this week.
Advisers have urged Keydata administrator PricewaterhouseCoopers to outline details of Lifemark’s proposed restructuring, warning investments in these policies could become worthless if policies lapse due to the firm’s inability to meet premium payments.
Around 23,000 Keydata clients invested £349m in Lifemark through plans including the secure income bond 4, secure income plan and the defined income plan. Lifemark has halted income payments to investors to preserve liquidity and maintain the value of the policies.
US hedge fund CarVal was understood to have proposed a £40m loan to Lifemark to pay premiums and return original capital to investors over a 14-year time frame depending on asset performance but PwC is yet to confirm if the deal will go ahead.
Vintage Financial director Geoff Hartnell says: “If something is not resolved by the end of this week, I suspect the portfolio will have lost certain value. Once you get policies lapsing, the cash values have basically gone.
“There are a number of different parties having discussions with partial or total remedies in mind but there is currently not a solution finalised.”
AWD Chase de Vere senior manager Jason Walker says: “We are keen to get things moving because there are timescales involved.”