Small investors asked to raise contribution or leave fund

As part of a major shake-up of the Catholic Development Fund, small investors have been asked by the Bishop of Dunedin to increase their contributions or leave the fund.

Turmoil on the global markets and new financial requirements have forced the Roman Catholic Diocese of Dunedin to review the fund, which has been operating since 1972.

Diocese general manager Stuart Young said the fund offered investors a lower rate of return than other funds, with some of the income diverted into community programmes, support for the diocese and Catholic education.

Despite performing satisfactorily in recent years, the fund's lower returns meant it was unable to continue in its present form, he said.

Bishop Colin Campbell had written to investors explaining the increased cost of maintaining some accounts had led to a new minimum investment level of $2000 being set.

"Those affected have the option to increase investments to a minimum of $2000 or have their investment returned," Mr Young said.

It was estimated more than half of the about 1000 investors in the Otago-Southland region would be affected by the changes.

It was too early to give an indication of the feedback from investors, Mr Young said.

The diocese had a smaller population catchment and a higher proportion of low dollar-value deposits compared with other dioceses around the country.

"We are a small region and thus the available investors and capital we can raise is limited when compared to the large population centres," he said.

The Catholic Development Fund lent only to Catholic organisations, with investments guaranteed by the Bishop of Dunedin.

- hamish.mcneilly@odt.c.nz

 

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