Lutheran Church investors mull options for troubled fund
Investors in a fund administered by the Lutheran Church in B.C. and Alberta are coming to terms with news that it is in deep financial trouble.
The $95 million Church Extension Fund (CEF) is suspended and expecting a cash flow shortage this spring.
So the district is looking at selling off assets like buildings, churches and schools.
This week people who invested in the fund are meeting to consider their options.
“It’s kind of a shock,” said Ruth Wagner outside a Lutheran church in Stony Plain. “Somebody should have been managing the money better.”
Two options are under consideration. Liquidate the church’s assets with a return of fifty cents on the dollar, at best.
Or sell some assets while trying to make a profit off the Prince of Peace Manor and Harbour east of Calgary, built in the late 1990s. The facility was financed by the CEP.
in 2012, the development had a loan worth $70 million from the investment fund.
Forensic accountant Justin Thoman says things look bad.
“Dire. You could also say they're on the brink,” he said.
“So much of their eggs in one basket that they've tied up a huge amount of their funds in this one investment.”
The situation in the Alberta-B.C.chapter has prompted the national church office to ask other branches to review their investment policies.
With files from the CBC's Trisha Estabrooks