Peregrine Fixed Income (PFI) - the department at the centre of the collapse of Peregrine Investments Holdings - accumulated debts of US$2.41 billion, barely 20 per cent of which was likely to be repaid to creditors, liquidators said. PFI, run by former Peregrine star banker Andre Lee, was responsible for the $265 million loan to Indonesian taxi firm Steady Safe, which caused the group's demise. Liquidator Price Waterhouse yesterday valued PFI's bond and derivative portfolio at about $2.07 billion, but said it had doubts about being able to recover more than three-quarters of the book. Price Waterhouse partner Colin Bird said PFI contributed almost 40 per cent of the group's profit, according to its 1996 accounts. 'This group would still be here if this one had not gone down,' he said. The liquidator said it could take several years before parts of the portfolio were sold off, particularly the Indonesian exposure. The most optimistic likely payout calculated was 52 cents in the dollar. Mr Lee attended yesterday's creditors meeting, along with former chairman Philip Tose and managing director Francis Leung Pak-to, but played no part in the proceedings. Head of the liquidation, David Hague, said an interim payout was possible in the next 12 months. The closing of derivative positions and other trades had so far netted just $262.3 million, he said. Liquidator Ted Osborn said only $491 million of exposure to US and European corporates could be considered good, with $1.57 billion of 'bad-book' or doubtful assets. About 95 per cent of the portfolio was in US dollars. Exposure to Indonesian entities totalled $1.09 billion, 52.4 per cent of total assets before provisions. Mr Osborn declined to give a specific value of the bank's exposure to Steady Safe but said it made up the majority of a $438 million asset category. It would take several years to maximise any return from the Indonesia-related assets. Price Waterhouse partner Simon Copley said an independent expert had advised liquidators that the complexity of PFI's positions meant the portfolio could not be managed and should be sold off as quickly as possible. The liquidators had identified approximately 1,600 trading positions, involving about 300 counterparties. Mr Hague said one possible strategy for realising the portfolio would be injecting assets into a unit trust structure and allowing creditors to sell out at their convenience. Mr Hague said the liquidators had had no contact with Mr Lee since he left the business on January 16. Like Peregrine Derivatives, PFI's biggest creditor is Peregrine Investments Holdings (PIH), which is owed about $900 million. Mr Hague said a final decision on whether legal action would be taken against PFI directors would be for the creditors' committee of inspection. At its peak, PFI employed 200 people and touted itself as the region's most active originator of Asian fixed-income products. In 1996 it made a pretax profit of $381.49 million. PIH creditor and shareholder meetings will be held at the Hong Kong Convention and Exhibition Centre today.