Wellington, Sept 19 NZPA - British bank HBOS, which became another casualty of the credit crisis, has loaned about $3 billion to New Zealand businesses.

Struggling HBOS is Britain's biggest mortgage lender and the owner of banks including Halifax and Bank of Scotland.

It is being taken over by Lloyds TSB in a Stg12b ($NZ33.4b) deal, amid fears of possible bankruptcy for HBOS and calamity for its 15 million savers.

Under the deal, HBOS's New Zealand and Australian operations could be sold and investments reviewed, The New Zealand Herald reported today.

In this country, the merger of Lloyds TSB and HBOS has sparked talk that the combined company could sell HBOS Australia, which lends money to property and finance companies in New Zealand through its subsidiary, BOS International.

Those loans include $35m helping to prop up consumer finance company Geneva, a $70m loan to the failed Dominion Finance and a proposal to increase lending from $75m to $150m to help save Strategic Finance.

It has also made extensive loans to New Zealand property developers, including $151m to Christchurch's Infinity Group for its Pegasus Town residential development expected to house 5000 people, and undisclosed loans thought to be more than $300m each to retail property developer New Zealand Retail Property Group, the owner of Auckland's Milford, Westgate and Highpoint shopping centres and Landco, the developer of a new Mt Wellington subdivision.

A spokesman for HBOS Australia said he could not comment on what the buy-out would mean for the business, but as far as it was concerned it was "business as usual".

Pegasus Group spokeswoman Hetty van Hale said she did not believe its loan would be affected by the change in ownership.

Meanwhile, The Dominion Post quoted New Zealand Superannuation Fund chief executive Adrian Orr saying institutional collapses and plunging markets would add value to the fund.

The $14.7b fund has returned average growth of 16 percent since 2004, but shows a 1 percent loss so far this year

"New Zealand Super is designed to both weather such volatility and benefit from it," Mr Orr said.

"As a long-term investor, we have deliberately invested in a wide range of global stocks and bonds, as well as other assets, to ensure we achieve our goal."

The Super Fund accumulates and invests government contributions to offset the New Zealand superannuation scheme. It is to report its annual results on September 29.

Among its direct equity and bond holdings are a $22.7m investment in Merrill Lynch, $13.6m in Lehman Brothers, $9.6m in AIG, and $24m in Morgan Stanley.

A further $26m is invested in Macquarie Group, $19m in Goldman Sachs, and $21m in failed mortgage houses Freddie Mac and Fannie Mae.

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