GM Finance's Review
Once again, Credit Corporation Finance Limited, the PNG based financial arm of the Group has had an exceptional year. All branches have performed extremely well with POM writing over K66 million, Lae K89 million and Kokopo almost K18 million. The PNGLNG project is a large contributor to this result, especially in Lae. The Group has also acquired quite few clients, with client interest continuing in 2012.
Credit Corporation Finance Limited maintained a sound operating profit of K18.68 million (2010: K19.61 million) for 2011. The PNGLNG project is predicted to commence demobilisation late this year and this will have an impact on financing in the near future. The Company is very conscious of this and is carefully monitoring the terms of new contracts to ensure they expire prior to the cessation of the project
In June 2011, we introduced a new Variable Rate Contract that caters for the clients wishing to enter into or develop the property market. This product allows for a variable rate and an extended term to enable clients to borrow against the asset and repay in manageable instalments. To date, it has proven very successful and we have been able to assist quite a few clients, with client interest continuing into 2012.
We feel that 2012 will be a difficult year due mainly to the PNGLNG project drawing to a close. This will have a large effect on our lending in the latter part of the year and we are currently promoting new clients to help fill this void. Despite this, Credit Corporation Finance Limited will again be a major contributor to the 2012 Group profit.
General Manager Finance