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Wednesday, April 04, 2007

Banking System keeps on profiting from RBF's monetary policy

The Fiji Times today reported the financial results released by Credit Corporation (PNG) Limited. In that report, there is a mention of its Fiji subsidiary, Credit Corporation (Fiji) Limited making a "record profit before tax of over F$6,066,642 for the year".

As I have reported earlier on this blog, the interest rates settings by the Reserve Bank of Fiji, aside from contributing to the hardships faced by individuals, small businesses and investors who need to finance part of their projects locally, is only contributing to the banks and other deposit taking institutions (of which Credit Corporation (Fiji) Limited is one) reporting these huge profits that they have not recorded over a large number of years.

I was expecting more Key Disclosure Statements (financial information that are published by banks and deposit taking institutions) to be published recently but have not seen those come out. Whether the Reserve Bank of Fiji has a hand in in those statements not coming out, I am not sure.

When they are published, I will have a look and post something on this blog.

In the meantime, here is the report in today's Fiji Times on the results recorded by Credit Corporation.

"Credit Corporation makes profit, Wednesday, April 04, 2007

CREDIT Corporation (PNG) Limited has announced a K56.93million net profit ($F32.89million) for the year, which represents almost 15 per cent increase for the same period last in 2005.

The company's earning per share was K1.13 ($F0.65) and the net tangible asset backing per ordinary share had increased to K5.79 ($F3.35), said Chairman of Credit Corporation (PNG) Limited, Sir Henry To Robert. Sir Henry was announcing the Corporation's results for the year ended 31st December 2006.

And while Credit Corporation (Fiji) Limited continued to perform well with a record profit before tax of F$6,066,642 for the year, Sir Henry said the economy in Fiji was under extreme pressure as a result of the military coup of December 5, 2006 and economic growth was forecasted to slow for the foreseeable future.

For Credit Corporation (PNG), Sir Henry announced that total assets now exceeded K486 million ($F280.78 million), an increase of nearly K80.0 million ($F46.22million) for the year.
Sir Henry said due to the national elections in Papua New Guinea and the coup in Fiji the results for the New Year, may be difficult to maintain at the 2006 level.

However, he said that the results for the first two months of 2007 had exceeded expectations. All segments of the group had reportedly continued to perform strongly and the company's investment in Bank South Pacific had continued well from 2005 with Bank South Pacific announcing an after tax profit of K111.62million ($F64.49million) for the year.

The increase in the share price of Bank South Pacific contributed K35.65million ($F20.60m) to the Corporation's total profit. "

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