Strong Six Months For Credit Corp Group Despite Competition

  Credit Corporation (Fiji) Limited has had a strong six months this year, despite an increasingly competitive environment. In a statement released by the company, it noted that the business
06 Oct 2018 10:00
Strong Six Months For Credit Corp Group Despite Competition
Peter Dixon, Credit Corporation (Fiji) Limited managing director.


Credit Corporation (Fiji) Limited has had a strong six months this year, despite an increasingly competitive environment.

In a statement released by the company, it noted that the business conditions in Fiji are expected to moderate leading into the upcoming National elections.

“Fiji is well placed to perform above expectations given its strong brand and balance sheet position,” the statement said.

“Despite continuing tough market conditions in key markets, Credit Corporation (PNG) Limited achieved solid results with continued growth across its three core business units – Finance, Property and Investment – for the six months to 30 June 2018.

Company chief executive officer Peter Aitsi said the first half FY18 result reflected the Company’s renewed focus on its core competencies across key areas of operation.

“Key highlights for the Group in the first half FY18 included recording improved operating results for our finance business, increased occupancies across our property portfolio and the continued delivery of strong dividends from the company’s key equity stake in Bank of South Pacific Limited (BSP),” Mr Aitsi said.

“The improved performance by the Group has resulted in a reduction in the expense to income ratio to 35 per cent, attributed to improved sales revenue growth and tighter cost control.

“Credit Corporation continued with its strong track record of dividend payments with Directors declaring an interim dividend of six toea per share, which was a 50 per cent increase.”

Finance Company Group results

The finance business reported a solid performance in the reporting period, with new loan sales up by 79.2 per cent resulting in net loan book growth of 30 per cent to $359.23 m (K545m) compared with the previous corresponding period.

The funding base for the business also improved, with deposits increasing by 18 per cent to $299 m (K454m).

Loan impairment expense for the group increased to $8.16 m (K12.4m)as a result of more challenging economic conditions in key markets.

The Group has continued to focus on quality loan growth, and arrears management.

The Group has now complied with the requirements of IFRS 9 and the impact is considered immaterial. Intense competition has resulted in net interest margin reducing to 9.29 per cent, down from 9.94 per cent for the previous corresponding period.

The business is placing increasing emphasis on managing loan arrears and expenses including doubtful debts.


The Board is presently undertaking a Strategic Review of the business which will set the direction of the business over the coming five years.

“That review is expected to be completed by the end of the 2018 financial year.

“Looking ahead, we will continue to focus on our core operations to increase our finance company’s market share in the key PNG market.

“We will also continue to focus on increasing occupancies across our property portfolio with the aim of being a landlord of choice.

“While general business conditions continue to be relatively flat in PNG, the business is well positioned to deliver continued value to shareholders given its solid capital base, and a growing balance sheet.

“In November 2018, PNG will host business and political leaders across Asia and the Pacific at the APEC forum.

“This high profile event is expected to showcase PNG and the Pacific, while offering opportunities in our key areas of activity in PNG.,” the statement said.

Credit Corporation Investments

Dividends from the Company’s shareholding in Bank South Pacific Limited increased by eight per cent.

Unrealised gains in the investments portfolio in the first six months amounted to $11.99m (K18.2m).

Credit Corp 2017 results

Credit Corporation (Fiji) Limited managing director Peter Dixon said: “The company enjoyed another very successful year in 2017, despite the challenges presented by an increasingly competitive asset finance market in 2017.

“2017 saw many sectors of the Fijian economy rebound from the damaging effects of cyclone Winston, with rebuilding efforts helping to fuel economic growth and in turn provide financing opportunities for the company.

“The company returned a record operating profit of $10.54 million (K16.19m) for the year, a 10 per cent increase on the prior year’s result.

“A very pleasing net after tax profit of $8.32m was recorded for the year, a 10 per cent increase in the prior year’s result and up on budget expectations.

“New business volumes exceeded $70m for the first time despite increasing competition, underlining a very strong effort from the sales team in 2017.

“2017 saw a healthy 14 per cent growth in the level of gross finance book, with the book increasing to $157.3m as at year end from $137.9m the previous year.”

Mr Dixon said their focus for 2018 will remain on building key relationships with their customers and their business partners, ensuring a high level of customer service and in turn maximising financial performance.


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