Asta Funding to Delay Quarterly Report

Bad debt buyer Asta Funding said late Tuesday in a filing with the Securities and Exchange Commission that it will not be filing its report for the quarter ended March 31 before the deadline imposed by the regulator. Asta said it missed the deadline due to lender renegotiations and portfolio assessments stemming from a massive portfolio purchase last year.

Englewood Cliffs, N.J.-based Asta (Nasdaq: ASFI) said that it would not be able to file its quarterly 10-Q report with the SEC for its second fiscal quarter of 2008 by the established due date.

Asta did say that it would be able to file the report within five days of the date. For a company of Asta’s size, the SEC requires 10-Q’s to be filed within 45 days of the close of the quarter, or by May 15 in the case of the first quarter.

Asta blamed ongoing issues with a $6.9 billion debt portfolio it purchased in March 2007 for $300 million for the delay. According to its filing, Asta said it was in negotiations with a lender that financed the purchase, and that it was evaluating the purchase, "in light of current economic circumstances." The company also is in discussions with a subservicer it hired to work the portfolio.

Earlier this month, Asta announced that it was borrowing $8.2 million from the Stern family that controls the firm in order to pay a third-party collector that was servicing the huge portfolio (“Asta Funding Gets Loan from Controlling Stern Family; Shares Tank,” May 2). Asta said the collector was experiencing a shortfall in the accounts, due to a weak economy and large upfront legal costs.

Asta’s shares were down more than 3 percent in midday trading today to $8.59, near its 52-week low price.