SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014 SING INVESTMENTS & FINANCE LIMITED...

download SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014 SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT

of 116

  • date post

    25-Apr-2020
  • Category

    Documents

  • view

    3
  • download

    0

Embed Size (px)

Transcript of SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014 SING INVESTMENTS & FINANCE LIMITED...

  • 1

    SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014

    Creating Possibilities with you

  • SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014

    Creating Possibilities with you2

  • 01

    SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014

    Creating Possibilities with you

    For over 50 years, our vision has been to excel in financial provision and delivering excellence for our clients. As one of Singapore’s most established finance companies, we have the opportunity to transform people’s lives with what we do.

    We enable businesses, create opportunities, and empower dreams. Nimble in adapting to our clients, we discover the best solutions to bring them closer to realizing their vision.

    Together, endless possibilities.

    02 Chairman’s Statement 04 Board Of Directors 08 Corporate Information 09 Corporate Governance Statement 27 Performance Review 30 5-Years Financial Summary 32 Corporate Social Responsibility

    34 Financial Reports 105 Additional Information 106 Statistics Of Shareholdings 108 Notice Of Annual General Meeting Proxy Form

    CONTENTS

  • SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014

    Creating Possibilities with you02

    Chairman’s Statement

    I am pleased to report that the Group had delivered another year of stable earnings with a 10.4% increase in profit after tax to $12.7 million.

    Singapore’s economy grew by 2.9% in 2014, slower than the 4.4% in 2013. Growth in the manufacturing sector improved from 1.7% in 2013 to 2.6% in 2014, supported by the biomedical manufacturing and chemicals clusters. On the other hand, growth in the construction sector moderated to 3% from 6.3% in 2013, weighed down by private sector construction activities. The services producing industries grew by 3.2% in 2014, easing from 6.1% growth in 2013. Growth was supported mainly by the finance and insurance sector which grew 7.7% over 2013 and helped offset weaknesses in other services segments such as wholesale & retail trade and transportation & storage.

    FINANCIAL REVIEW

    Despite the challenging operating environment, the Group managed to grow its loan assets by 9.2% or $143.1 million, from $1,547.1 million as at 31 December 2013 to $1,690.2 million as at 31 December 2014. In tandem with the higher loan base, deposits and savings accounts of customers increased by 10.4% to $1,921.4 million as at 31 December 2014.

    The Group registered a profit after tax of $12.7 million for the financial year ended 31 December 2014, an increase of 10.4% compared to $11.5 million a year ago. The improvement in performance was mainly attributed to an increase in net

    interest income and hiring charges. This was partially offset by an increase in operating expenses, higher charge for allowances for impairment losses on loans and income tax expense.

    Net interest income rose 8.4% to $32.6 million for the year, driven by loan growth and a stable net interest margin.

    Non-interest income increased by 6% to $4.5 million mainly due to a 8.1% increase in rental income from investment properties arising from high occupancy and rental rates.

    Operating expenses increased by 1.5% mainly due to an increase in business costs from an expansion of business activities. This was partially offset by a decrease in the depreciation charge as some of the renovation costs had been fully depreciated in the previous year. In addition, staff costs declined by 2.5% due to a lower provision for staff bonus.

    In line with the loan growth, the Group has set aside additional collective impairment allowances at a portfolio level. There was also a decrease in write-back of individual impairment resulting in an increase of $1 million in net allowances for loan losses for the year. Adequate individual and collective impairment allowances for the loan portfolio were being set aside during the year.

    There was an increase in the fair value of available-for-sale financial assets under Other Comprehensive Income, mainly

    Lee Sze Leong Chairman

  • 03

    SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014

    Creating Possibilities with you

    Chairman’s Statement

    from revaluation of Singapore Government Securities (“SGS”) as compared to a decline in the previous year. The Group purchases SGS as part of its liquid assets for purpose of maintaining the minimum liquid assets required under the Finance Companies’ Act.

    The Group’s total equity increased 3.2%, from $303.6 million to $313.4 million and net asset value per share rose from $1.93 to $1.99.

    DIVIDENDS

    Subject to the approval by the shareholders at the forthcoming Annual General Meeting, the Board is pleased to recommend a first and final one-tier tax exempt dividend of 6 cents per share.

    2015 OUTLOOK

    The global economic environment in 2015 is expected to remain challenging. Despite the recovery in the US economy, growth in the Eurozone is expected to remain weak, due to sluggish labour market conditions and deflationary pressures. Market volatility risk remains arising from the US Federal Reserve’s anticipated normalisation of its monetary policy and the expected resultant capital outflow from the emerging markets. Further, the slowdown in China’s economy will also have knock-on effects on regional demand and market sentiment.

    Singapore’s external oriented sectors such as the manufacturing and wholesale trade sectors are thus likely to face headwinds. Domestically, the labour market is expected to remain tight and labour-intensive sectors such as construction, retail and food services may see their growth weighed down by labour constraints though business services are expected to remain resilient. Against this backdrop, the Singapore economy is expected to grow at a modest pace of 2 to 4% in 2015.

    Given the challenging economic environment and the continual impact of the prudential measures by the government to curb financing of property and car loans, we expect a moderation in loan growth. However, the Group will continue to grow its portfolio cautiously to maintain high asset quality. We will also continue to be disciplined in our cost management and to maintain healthy financial and liquidity positions.

    We are fully committed to deliver excellent service to our customers and remain focused on seeking opportunities to provide them the best financial solutions and services to meet their needs. We will also strive to adhere to the best practices

    in corporate governance to protect our shareholders’ interests.

    In our commitment to incorporate Goods & Services Tax (“GST”) risk management as part of good corporate governance, we participated in the GST Assisted Compliance Assurance Programme (“ACAP”), a compliance initiative by IRAS for businesses that set up robust GST Control Framework as part of good corporate governance. We were accorded ACAP Premium Status for 5 years in recognition of our efforts in establishing a good tax infrastructure to ensure GST compliance on an ongoing basis.

    We have also invested in an enterprise-wide data management system to enhance and facilitate our portfolio analysis and risk management capabilities.

    To keep pace with the changes in regulatory requirements, we will continue to strengthen the robustness of our risk management and compliance system.

    ACKNOWLEDGEMENTS

    2014 marked a significant milestone in the history of the Company, being our 50th anniversary. To commemorate this historical milestone, we embarked on a series of promotions and sponsored gifts to customers and staff. We were also active in donating to worthy causes and funding employee volunteer initiatives. These activities have also enhanced the awareness of our brand and products. Building on our long history of growth, we are confident that we will make further progress in our business and grow to strengthen our capital structure and enhance shareholder value.

    I welcome to the Board, Mr Chee Jin Kiong, who was appointed as an Independent Director from 1 September 2014. Mr Chee has many years of finance experience and the Board will benefit from his wealth of knowledge and management experience.

    I wish to thank the Board members for their support, counsel and guidance. I acknowledge and commend the staff for their dedication and contribution in bringing the Group to where it is today. Last but not least, to our valued shareholders and customers, my heartfelt thanks for your steadfast and loyal support over the years.

    Lee Sze Leong Chairman

    Date: 1 April 2015

  • SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2014

    Creating Possibilities with you04

    Board of Directors as at 28 February 2015

    MR LEE SZE LEONG, 56

    Role: - Chairman & Managing Director - Executive and Non-Independent Director

    Date of first appointment as a director: 20 Feb 1989

    Date of last re-election as a director: 25 Apr 2013

    Length of service as a director: 26 years

    Board/Working Committee(s) served on: - Nominating Committee (Member) - Risk Management Committee (Member) - Loan Committee (Chairman)

    Academic & Professional Qualification(s): - Bachelor of Business Administration, University of Hawaii

    Present Directorships in listed companies: - Sing Holdings Limited

    Other Appointments: - F.H. Lee Holdings (Pte) Limited (Director) - Sing Investments & Finance Nominees (Pte.) Ltd. (Director) - Hire Pur