ContentsAccountancy and Graduate’s Commerce Diploma. He is a director of SV Holdings Ltd, Times...

Contents02 CHAIRMAN’S STATEMENT | 03 CORPORATE DATA | 04 BOARD OF DIRECTORS

06 CORPORATE GOVERNANCE STATEMENT | 11 PERFORMANCE REVIEW | 15 5-YEAR FINANCIAL

SUMMARY | 16 FINANCIAL REPORTS | 72 STATISTICS OF SHAREHOLDINGS | 74 NOTICE OF ANNUAL

GENERAL MEETING

ANNUAL REPORT 2009 | 01

Chairman’s Statement

Lee Sze LeongChairman

02 | SING INVESTMENTS & FINANCE LIMITED

2009 had been a challenging year impacted by the global economicdownturn and the tightening of credit markets particularly in theearly part of the year. The Singapore economy contracted by 2%in 2009 as compared to a 1.4% growth registered in 2008. Theimplementation of aggressive government stimulus packagessucceeded in stabilizing the financial markets leading to animprovement in the economic conditions in the second half ofthe year.

Total non-bank loan assets of the financial sector grew 2.7% in2009. However, finance companies’ total loan assets declined by17% to $8.1 billion as lending to the housing sector fell by 23%,while that to building and construction and hire-purchase financingslipped 17% and 14% respectively.

Financial Results

With the uncertain economic environment prevalent during theyear, the Group was cautious in its lending activities and withloan repayments exceeding new loans, loan assets decreasedby 24.7% to $1,048.7 million as at 31 December 2009 resultingin a decrease of 4.6% in operating revenue to $63.4 million.

Despite the decline in loan assets and operating revenue, I ampleased to announce that the Group registered a profit after taxattributable to shareholders of $17.7 million for the year ended31 December 2009, an increase of 219.8% or $12.1 million fromthe previous year.

This was mainly attributable to an improved net interest marginas interest expense fell by 31% as compared to the previous yeardue to lower funding costs. Net interest margin as a percentageof the interest-earning assets improved from 2.1% to 2.5%. Inaddition, impairment allowances declined by 44% to $7.5 million,from $13.4 million in the previous year.

Deposits and savings accounts of customers declined 4.8% to$1,389.4 million as at 31 December 2009. Total cash and bankbalances, statutory deposits with MAS and available-for-sale(AFS) financial assets rose 60% to $540.4 million as the Groupcontinued to strengthen its balance sheet and liquidity.

Non-performing loans ratio increased from 1.5% to 1.7%. However,the Group continues to maintain adequate individual and collectiveimpairment allowances in respect of its loan portfolio.

Earnings per share rose to 16.80 cents, from 5.25 cents a yearago and net asset value per share rose from $1.87 to $1.91 asthe Group’s total equity increased 1.9% from $196.7 million to$200.5 million.

Dividends

Subject to approval by shareholders at the Annual General Meetingon 29 April 2010, the Board is recommending a first and finalone-tier tax exempt dividend of 8 cents per share.

Prospects

The Singapore economy is expected to grow at 4.5 to 6.5% in2010. While the economy is likely to post healthy growth ratesin the first half of 2010 in line with the improvement in businessexpectations, the outlook for the second half of the year remainsuncertain. The risks of weak consumption and firms faltering aswell as financial market weaknesses may emerge once governmentstimulus wears off later this year. In addition, there are concernsof asset price inflation in Asia and increasing fiscal pressures insome European economies.

Operating in this difficult and challenging business environment,the Group will adopt a prudent business approach with anemphasis on cost-control measures and efficiency improvement.We will also continue to seek new business opportunities and toprovide solutions to meet our customers’ financing needs. Wewill continue to ensure that our lending criteria remain prudentyet relevant and to closely monitor the loan portfolio to maintainasset quality. We have also set up a risk management departmentto strengthen and refine our risk management policies to enableus to actively manage our risks and businesses in this challengingenvironment.

We will remain focused on strengthening the relationships withour customers and depositors and will strive to maintain the highquality of our customer service. The Group will manage itsoperating costs prudently and strengthen its liquidity and financialposition in its continuous efforts to deliver reasonable returns andenhance shareholder value.

Acknowledgements

I would like to thank our customers and shareholders for theirsteadfast support and confidence in the Group. I also wish toextend my appreciation to the Board members for their valuableinput and contributions as well as the staff for their dedicationand efforts which were integral in our achievements in 2009.

Date: 12 April 2010

“

”

I am pleased to announce thatthe Group registered a profit

after tax attributable toshareholders of $17.7 million

for the year ended 31December 2009, an increaseof 219.8% or $12.1 million

from the previous year.

Board Of Directors• Lee Sze Leong Chairman

• Tan Tong Guan• Dr Joseph Yeong Wee Yong• Lim Sin Hoa• Tay Teng Guan Arthur• Lee Sze Siong• Aw Kim Chen

(deceased on 16 January 2009)

• Li Loi Gan(retired w.e.f. 1 May 2009)

• April Lee nee Tang Biew Chin(retired w.e.f. 24 April 2009)

Audit Committee• Tan Tong Guan Chairman

• Dr Joseph Yeong Wee Yong• Tay Teng Guan Arthur

Nominating Committee• Dr Joseph Yeong Wee Yong Chairman

• Lim Sin Hoa• Lee Sze Leong

Remuneration Committee• Lim Sin Hoa Chairman

• Tan Tong Guan• Tay Teng Guan Arthur

Loan Committee• Lee Sze Leong Chairman

• Lim Sin Hoa• Li Loi Gan

(retired w.e.f. 1 May 2009)

• April Lee nee Tang Biew Chin(retired w.e.f. 24 April 2009)

Registered & Head Office96 Robinson Road#01-01 SIF BuildingSingapore 068899Tel 6305 0300Fax 6305 0328www.sif.com.sg

Branch OfficesAng Mo Kio BranchBlk 715 Ang Mo KioAve 6 #01-4006Singapore 560715Tel 6456 0588Fax 6456 9715

Bedok BranchBlk 202 Bedok North Street 1#01-479/481Singapore 460202Tel 6445 9596Fax 6449 3254

Clementi BranchBlk 450 Clementi Ave 3#01-279Singapore 120450Tel 6775 7248Fax 6775 3463

Secretaries• Chan Kum Kit• Tan Mui Sang

AuditorsDeloitte & Touche LLP6 Shenton Way #32-00DBS Building Tower TwoSingapore 068809(Partner in charge – Giam Ei LeenDate of appointment - 1 April 2008)

RegistrarBoardroom Corporate &Advisory Services Pte Ltd50 Raffles Place #32-01Singapore Land TowerSingapore 048623Tel 6536 5355

Corporate Data



Lee Sze Leong Age 51

Mr Lee became a member of the Board in February 1989 andwas appointed as its Chairman and Managing Director in January1997. He was last re-elected as director on 12 April 2007. Hechairs the Loan Committee, Asset & Liability Committee andCredit Risk Management Committee. He is also a member ofthe Nominating Committee. He was appointed the director of theCompany’s subsidiary, Sing Investments & Finance Nominees(Pte.) Ltd in October 1983.

Mr Lee has been active in various grassroots organizations andassociations. He is presently the Chairman of the Tiong BahruCitizens’ Consultative Committee and a Council Member of theTanjong Pagar Town Council. He is the Chairman of the HirePurchase, Finance and Leasing Association of Singapore, theSecretary of the Finance Houses Association of Singapore anda Council Member of Singapore Chinese Chamber of Commerce& Industry.

Mr Lee is a non-executive director of Sing Holdings Ltd, a companylisted on the Singapore Exchange Ltd.

Mr Lee was awarded the Public Service Medal (Pingat BaktiMasyarakat) in 1997 and Public Service Star (Bintang BaktiMasyarakat) in 2007. Mr Lee holds a degree in BusinessAdministration from the University of Hawaii, Manoa, USA.

Board Of Directors


Tan Tong Guan Age 46

Mr Tan joined the Board in 2005 and was last re-appointed as adirector at the Company’s Annual General Meeting on 23 April2009. He is also the Chairman of the Audit Committee and amember of the Remuneration Committee.

Mr Tan holds a Bachelor in Accountancy degree from the NationalUniversity of Singapore and is a Fellow (Non-Practising) memberof the Institute of Certified Public Accountants of Singapore. Heis also an Executive Director of Tan Gee Beng Pte Ltd, SmartflexTechnology Pte Ltd and Perusahaan TGB Sdn Bhd.

Joseph Yeong Wee Yong Age 58

Dr Yeong has been a member of the Board since 1997 and waslast re-elected as a director at the Company’s Annual GeneralMeeting on 23 April 2009. He is also the Chairman of theNominating Committee and a member of the Audit Committee.He is the President of SGP International Management Academy(SIMA) and holds a Ph.D in Management Science from theUniversity of Waterloo, Canada. He had taught in the NUSBusiness School for 21 years before forming SIMA in 2001.

Dr Yeong is also a member of the Singapore Government Pro-Enterprise Panel, a Director of the Tan Kah Kee Foundation, Boardmember of Tan Kah Kee International Society, Council Memberof the Singapore Shandong Business Council and SteeringCommittee Member of Network China, Singapore, Advisory BoardMember of the School of Business Administration, Jimei University,the People’s Republic of China.

Lim Sin Hoa Age 77

Mr Lim has been a member of the Board since 1996. He waslast re-elected as a director at the Company’s Annual GeneralMeeting on 23 April 2009. He is also Chairman of the RemunerationCommittee and a member of the Nominating Committee andLoan Committee. Mr Lim holds a Bachelor of Science degree inAccountancy and Graduate’s Commerce Diploma. He is a directorof SV Holdings Ltd, Times Express Pte Ltd, Kong Hoa Pte Ltd,Lim Kok Gin & Nephews Pte Ltd, Hong Yin Enterprises Pte Ltd,Koln Industries Pte Ltd and Sin Chang Investments Pte Ltd andChairman of Lim Kok Gin Education Foundation, China.

He is also a director of Sing Holdings Ltd, Hokien Kiu Leong Tong,SHATEC Institutes Pte Ltd in Singapore and Kong Hoa (H.K.) Ltdin Hong Kong. In addition to the Honorary Life Membership ofAsean Tourism Association (ASEANTA) and Asean Hotel &Restaurant Association (AHRA), Mr Lim was awarded HonoraryLife Membership of Singapore Hotel Association. He was conferredthe Honorary Citizen of Changxing, China since 15 October 2003and granted China Charity Award 2008 by the Ministry of CivilAffairs.

Tay Teng Guan Arthur Age 53

Mr Tay joined our Board as an alternate director in 1994 and wasappointed director in 1998. He was last re-elected as a directoron 18 April 2008. He is also a member of the Audit Committeeand Remuneration Committee.

Mr Arthur Tay is Group Executive Chairman and CEO of the SUTLGroup of Companies, a pan-Asian group covering more than 17countries in the Asia Pacific with annual turnover of more thanS$300 million and group assets exceeding S$330 million.

SUTL has two main divisions covering Lifestyle consumer goodsand leisure investments with interests ranging from duty freeconsumer goods to bowling alleys, fast food, casual dining,confectionery, cosmetics, wellness, property businesses, andAsia’s Finest Marina Club (Asia Pacific Boating 2009) at SentosaCove, Singapore.

Mr Tay is the Executive Director and Chief Executive Officerdesignate of Achieva Limited and SUTL is also the substantialshareholder of this public listed company in Singapore.

He takes an active role in various volunteer organizations anddevotes considerable time and expertise serving on severalcommunity service and grassroots organizations. He is a Patronof West Coast Citizens’ Consultative Committee and Bukit BatokCitizens’ Consultative Committee. He is also a Member of CashewCitizens’ Consultative Committee. In addition, Mr Tay is the VicePresident of the National Heart Council (Singapore HeartFoundation).

Lee Sze Siong Age 48

Mr Lee joined the Company in 1986 and was appointed to theBoard in 1997. He was last re-elected as a director on 18 April2008. He currently oversees the Company’s credit operations,IT, branches, HR and Property Management. He is a member ofAsset & Liability Committee and Credit Risk ManagementCommittee.

Mr Lee holds a Bachelor of Business Administration degree fromUniversity of Hawaii, USA and a Master in Accounting fromUniversity of Southern Queensland, Australia. He is also thedirector of F. H. Lee Holdings Pte Ltd, Meyer Development PteLtd and Sing Investments & Finance Nominees (Pte.) Ltd. Mr Leeis currently appointed as an Auditor of the Balmoral NeighborhoodCommittee.

Sing Investments & FinanceLimited, through its Board andexecutives recognizes the need toestablish and maintain the higheststandards of corporate governancepolicies and practices (i.e. theCode of Corporate Governance2005, also known as the “Code”)which reflect the requirements ofthe market regulators andparticipants and the expectationsof members and others who dealwith our Company. These policiesand practices remain underconstant review as the corporategovernance environment and goodpractice evolve.

Corporate Governance Statement


Board of Directors

Functions of Board and Management

The Board oversees the Group’s business and is accountableto shareholders for creating shareholder value within aframework that protects the rights and interests ofshareholders and ensures the Company is properly managed.These objectives are met through the following functionsexercised by the Board directly or through committeesestablished by the Board:

• Overseeing and formulating long-term businessstrategies and policies and ensuring that the necessaryhuman resources are in place to meet the objectives;

• Identifying the principal risks of the Company’s businessand establishing a framework of prudential controls to assess and manage these risks;

• Monitoring and reviewing management performance, succession and development plans;

• Setting the Company’s values and standards, andensuring that they are consistent with shareholders’objectives and expectations; and

• Maintaining a culture of integrity by reviewing andmonitoring internal controls and procedures for financialreporting and compliance.

Composition and Size of the Board

The composition of the Board members was reduced from9 to 6 as at 31 December 2009 on the retirement of twodirectors and, regretfully, the demise of one. The Boardcontinues to have four independent directors. The other twoare executive directors.

The composition satisfies the independence requirement ofthe Code that the independent directors should make up atleast one-third of the Board. At present, majority of the Boardare independent.

Audit Nominating Remuneration Loan Date first LastBoard/Board Committees Board Committee Committee Committee Committee appointed re-appointed

No. of meetings held 4 5 4 1 3

Number of meetings attended

Lee Sze Leong 4 5 4 1 3 20-2-1989 12-4-2007By invitation By invitation

Tan Tong Guan 4 5 1 1 NA 25-4-2005 23-4-2009By invitation

Dr Joseph Yeong Wee Yong 4 4 4 1 NA 19-3-1997 23-4-2009By Invitation

Lim Sin Hoa 4 NA 4 1 3 25-3-1996 23-4-2009

Tay Teng Guan Arthur 3 4 1 1 NA 13-8-1998 18-4-2008By invitation

Lee Sze Siong 4 1 NA NA NA 19-3-1997 18-4-2008By invitation

Aw Kim Chen - NA NA NA -(deceased on 16 January 2009)

Li Loi Gan 1 NA NA NA 0(retired w.e.f. 1 May 2009)

April Lee nee Tang Biew Chin 1 NA NA NA 1 (retired w.e.f. 24 April 2009)


The Board periodically reviews its size as appropriate. It alsoconsiders the core competencies such as accounting, finance,business, management experience, customer-basedknowledge and other relevant experience adequate foreffective management and decision-making among itsmembers.

Board Performance & Succession Planning

The performance of the Board as a whole and the individualcontribution of each director to the effectiveness of the Boardis assessed every year by the Nominating Committee.

Role of Chairman and CEO

Mr Lee Sze Leong is the Chairman of the Board and he isalso the Managing Director/CEO of the Company. The Boardis of the view that there is adequate accountability andtransparency as reflected by the internal controls establishedwithin the Company. Major decisions and policy changeson significant matters are made in consultation with therespective Board committees and reviewed by the Board.

Also, the Board believes that, notwithstanding that theChairman and Managing Director/CEO is the same person,the Company’s interest remains well served by:

(1) the benefit of a Chairman who is both knowledgeableabout the industry and Company’s businesses, andhave significant experience in the Company to ensurethe smooth and efficient implementation of decisionson major and pertinent issues, and

(2) the benefit of a majority of independent directorsexercising objective and independent judgment oncorporate matters which ensure a balance of powerand authority.

Board Committees are either chaired by or include thepresence of independent directors. All major decisions andpolicy changes are conducted through the respectivecommittees.

Further, the Audit Committee Chairman will preside overthe Board meeting when the Chairman is not available.

Board Meetings

The Board met 4 times during the year that was beingreviewed. The Chairman would brief the Board on the issuesto be discussed during the Board meetings. The documentspertaining to important and complex issues would becirculated for the board’s review before the members meetto discuss them.

The Board’s attendance at the Board and Board Committees’meetings during 2009 are set out as follows:



Board Committees

The Board has established a number of committees to assistin the execution of its duties and to allow detailedconsideration of complex issues. Although the Companydoes not have an EXCO, the following Committees havebeen set-up to assist the Board in the management of theCompany:-

1) Audit Committee2) Nominating Committee3) Remuneration Committee4) Loan Committee5) Credit Risk Management Committee (CRM)6) Asset & Liability Committee (ALCO)

Decisions and recommendations of Board committees aretabled at the Board meetings for review, endorsement and/orapproval.

Audit Committee

The Audit Committee comprises Mr Tan Tong Guan(Chairman), Dr Joseph Yeong Wee Yong and Mr Tay TengGuan Arthur.

The Audit Committee is responsible for assisting the Boardin its oversight of the reliability and integrity of the accountingpolicies and financial reporting, as well as to scrutinize theadequacy and effectiveness of the internal controls. Indischarging its oversight role, the Committee is authorizedand empowered to investigate any matter within its termsof reference and has full access to and cooperation of theManagement.

The Audit Committee, together with the Management andthe external auditors, reviews the Company’s audited financialstatements, the quality of the accounting principles applied,the financial statement presentations and the items thataffect the financials. Through the maintaining and applicationof appropriate accounting and financial reporting principlesand policies and internal controls and procedures, the AuditCommittee determines whether the financial statementscomply with the accounting standards and applicable lawsand regulations.

The Audit Committee holds at least one private meeting withthe external auditor without the presence of Management.It examines the audit findings of the external and internalauditors and considers all major findings. It also reviews withthe Internal Audit Manager on the scope, results andeffectiveness of the audits and approves the internal auditplan in consultation with the Management.

Nominating Committee

The Nominating Committee comprises three members, DrJoseph Yeong Wee Yong (Chairman), Mr Lim Sin Hoa andMr Lee Sze Leong. Both Dr Joseph Yeong Wee Yong andMr Lim Sin Hoa are Independent non executive Directors.

The main role of the Nominating Committee is to assess andrecommend candidates for appointment and re-nominationon the Board and Committees. It also reviews and recommendon the Board performance and composition.

The Nominating Committee is also charged with theresponsibility of determining annually whether or not aDirector is independent. Where a Director has multiple Boardrepresentations, the Nominating Committee also considersif such Director is able to adequately carry out hisresponsibilities as a Director of the Company.

The Nominating Committee assesses the effectiveness ofthe Board as a whole and the contribution by each individualdirector to the effectiveness of the Board. Performanceindicators include comparison of the Company’s performancefor the period under review against past years and theachievement of objectives and strategic directions set andapproved by the Board. Assessment parameters for directorsinclude:

• Attendance – The Directors should attend the Board Meetings when required.

• Availability – The Directors should be available when needed. Their involvement in other companies shouldnot affect their availability to the Company.

• Participation in Board Meetings – Directors should participate freely in discussion and decision-making and express their opinions objectively.

• Working relationships with other directors – Directorsshould work well together and are able to freelychallenge or complement each other’s suggestionsand comments.

• Training – Directors should attend training courses toenhance their job knowledge and performance.

Remuneration Committee

The Remuneration Committee comprises Mr Lim Sin Hoa(Chairman), Mr Tan Tong Guan and Mr Tay Teng Guan Arthur.

The primary role of the Remuneration Committee is to assistthe Board in fulfilling its objectives which are:


• To minimize the risk of any potential conflict of interestby putting in place a formal and transparent procedurefor developing policy on executive remuneration andfor fixing the remuneration packages of individualdirectors;

• To make recommendations to the Board on the Group’sframework of remuneration for directors and seniormanagement executives with the aim to be fair andavoid rewarding poor performance; and

• To review the adequacy and form of the compensationfor each of the directors, the CEO and seniormanagement executives to ensure that thecompensation is realistically commensurate with theduties, responsibilities and risk involved in being aneffective director, CEO or senior management executive.

Directors’ remuneration in bands of $250,000 are shown inthe Directors’ remuneration on page 71.

The Listing Manual requires that, at a minimum, disclosuremust be made as recommended in the Code that at leastthe top five key executives’ remuneration be disclosed withinbands of $250,000. However, this information is not disclosedin this Annual Report as the Board is of the opinion that suchdisclosure would be disadvantageous to the Group’s businessinterests, given the highly competitive conditions in thefinance industry where poaching of executives is common.

Loan Committee

Members of the Loan Committee are Mr Lee Sze Leong(Chairman) and Mr Lim Sin Hoa. The number of LoanCommittee members was reduced from 5 to 2 during theyear. This is due to the demise of Mr. Aw Kim Chen and theretirement of Mrs. April Lee nee Tang Biew Chin and Mr. LiLoi Gan.

The primary role of the Loan Committee is to review andapprove credit requests that exceed the credit limitsauthorized for senior management. Members of theCommittee would meet several times during the year toconsider the loan applications recommended for approvalby the Management.

All directors and directors’ related loans must be approvedby the Board.

Credit Risk Management &Asset and Liability Committees

Risk Management is an integral part of the Company’scorporate governance programs. Two key managementcommittees, headed by the Chairman and Managing Director,Mr Lee Sze Leong, namely the Credit Risk ManagementCommittee and the Asset and Liability Committee, reviewand assess the risks associated with the Company’s creditoperations and funding requirements.

The Credit Risk Management Committee oversees theCompany’s credit activities and risk management processes,including reviewing periodically the credit policies, guidelinesand procedures as well as evaluating the risk profile of theCompany’s loan portfolio.

The Asset and Liability Committee reviews the risk profile ofthe Company against the prevailing business and economicconditions, focusing on liquidity, market and interest raterisks.

Periodic meetings are conducted by both committees whoreport their findings to the Board.

Internal Controls & Compliance WithPolicies And Regulations

A system of effective internal controls plays a crucial role inthe banking operations as it sets a foundation for the safeand sound operation of banking organizations, thussafeguarding the shareholders’ investments and theCompany’s assets. The Board of directors is fully aware ofits responsibilities in establishing and maintaining a strongcontrol culture within the organization and also for ensuringthere are adequate policies in relation to risk management,compliance and internal control systems.



The internal audit function of the Company is well-establishedand the Internal Audit Manager continued to report to theAudit Committee. Various audit tests are performed by theInternal Audit Department to ensure the integrity of theCompany’s financial system and operating procedures, aswell as the soundness of the Company’s internal controls.

The Compliance Department conducts tests to ensure thatthe Management and staff continue to observe all policiesand guidelines set by the Board of Directors, and complywith the applicable laws, regulations and professionalstandards, including those for anti-money laundering andcounter terrorists financing.

Investments

The Board reviews and manages the Company’s long terminvestment portfolio with the view of diversifying theCompany’s assets as well as making gains from theinvestments. The Board formulates investment policies,strategies and guidelines and periodically reviews theinvestment portfolio.

Approval on proposed acquisition/sale of any investment isexecuted by way of a circular resolution and the Board ofDirectors is updated of the investment portfolio during theboard meetings.

Related Party Transactions

During the year, the Company had granted credit facilitiesto its directors and their related parties. It had also collecteddeposits from its directors and their related parties. Nopreferential treatment had been extended to the directorsand their related parties in respect of these credit facilitiesand deposits.

Disclosure of related party transactions during the year isshown on pages 59 to 60.

Dealing In Company’s Shares

The Company continues to adopt the best practicesadvocated by the Stock Exchange Securities Trading Limitedfor the trading of the Company’s shares by its staff anddirectors.

Communication With Shareholders

The company engages in regular and effective communicationwith its shareholders. All shareholders will receive the annualreport of the Company and the notice of the Annual GeneralMeeting. In addition, the Board also updates shareholderson the Company’s quarterly financial results via SingaporeExchange’s SGXNET. The financial results are freely availableat the Company’s webpage at www.sif.com.sg.

The external auditors, chairpersons and other directors ofthe respective committees are available at general meetingswhere shareholders are given the opportunity to ask relevantquestions and express their views.

Business And Ethical Conduct

The Company continuously exercises prudence in its businessdealings. It ensures that all staff continue to observe highstandards of professionalism and integrity in their dealingswith the customers and business associates. The Companyhas in place a whistle blowing policy for the independentinvestigation and appropriate follow-up actions on anyfeedback / complaints received from the customers.

Performance Review

ANNUAL REPORT 2009 | 11(1) Return on equity is computed based on ordinary shareholders' equity at balance sheet date.(2) Return on total assets is computed based on total assets as at balance sheet date.

Selected Income Statement ItemsNet interest income 41,337 34,439 20.0

Non-interest income 4,263 4,178 2.0

Total income 45,600 38,617 18.1

Operating expenses (16,951) (16,999) (0.3)

Profit from operations before impairment losses 28,649 21,618 32.5

Allowances for impairment losses on loans and advances (7,476) (13,360) (44.0)

Profit before income tax 21,173 8,258 156.4

Profit after tax attributable to equity holders of the Group 17,652 5,520 219.8

Selected Balance Sheet ItemsTotal equity 200,467 196,670 1.9

Total assets 1,640,680 1,781,969 (7.9)

Loans and advances 1,048,663 1,392,687 (24.7)

Deposits and savings accounts of customers 1,389,440 1,459,082 (4.8)

Key Financial Ratios (%)Net interest margin 2.5 2.1

Non-interest income-to-total income 9.3 10.8

Cost-to-income ratio 37.2 44.0

Loans-to-deposits ratio 75.5 95.4

Non-performing loans ratio 1.7 1.5

Return on equity (1) 8.8 2.8

Return on total assets (2) 1.1 0.3

Capital adequacy ratio 19.0 14.3

Per Ordinary Share DataBasic earnings per share (cents) 16.80 5.25

Net asset value per share ($) 1.91 1.87

2009$’000

2008$’000

VARIANCE+/(-) %

NET INTEREST INCOMEINTEREST-EARNING ASSETS & INTEREST-BEARING LIABILITIES

Performance Review


The Group’s loan assets registered a decrease of 24.7% to$1,048.7 million as at 31 December 2009 as it was cautiousin its lending activities in the uncertain business environmentof 2009. This has resulted in a 4.6% decrease in the interestincome and hiring charges.

Despite the decline in loan assets and interest income andhiring charges, net profit attributable to equity holders for theyear increased by 219.8% to $17.7 million mainly due to animprovement in the net interest margin as a percentage ofinterest-earning assets to 2.5% from 2.1% and a decrease inthe impairment allowances of 44% or $5.9 million over theprevious year.

Net interest income, which constitutes 90.7% of the totalincome, rose by 20%, driven by lower funding costs. Operating

expenses declined marginally as the decrease in businesscosts was partially offset by increases in staff costs anddepreciation charge. The cost-to-income ratio improved to37.2% from 44% a year ago.

Earnings per share rose to 16.80 cents from 5.25 cents a yearago and net asset value per share rose from $1.87 to $1.91as equity increased by about 1.9% from $196.7 million to$200.5 million.

Subject to approval of shareholders at the forthcoming AnnualGeneral Meeting, the Board is recommending a first and finalone-tier tax exempt dividend of 8 cents per share for thefinancial year 2009.

Average Average Average AverageBalance Interest Rate Balance Interest Rate

$'000 $'000 % $'000 $'000 %

Interest-Earning AssetsLoans and advances 1,259,621 54,483 4.3 1,391,872 59,137 4.2

Singapore Government Securities 232,041 7,605 3.3 201,241 6,657 3.3

Other interest-earning assets 143,448 1,316 0.9 59,841 642 1.1

Total 1,635,110 63,404 3.9 1,652,954 66,436 4.0

Interest-Bearing LiabilitiesDeposits and savings accounts 1,429,945 20,941 1.5 1,439,972 28,985 2.0

SPRING loans (unsecured) 16,765 479 2.9 16,564 626 3.8

Medium-Term Notes 14,841 633 4.3 50,000 2,180 4.4

Other liabilities 888 14 1.6 9,008 206 2.3

Total 1,462,439 22,067 1.5 1,515,544 31,997 2.1

Net interest income/margin as a

percentage of interest-earning assets 41,337 2.5 34,439 2.1

Net interest income rose by 20% to $41.3 million driven by lower funding costs. The Group’s net interest margin as a percentage

of interest-earning assets improved to 2.5% from 2.1% a year ago as the cost of funds fell at a faster pace than the yields on

assets.

2009 2008


An analysis of the changes in net interest income in 2009 over 2008 is shown below:

VOLUME AND RATE ANALYSISVolume Rate Total

$'000 $'000 $’000Increase / (Decrease) for 2009 over 2008

Interest Income

Loans and advances (5,555) 901 (4,654)

Singapore Government Securities 1,016 (68) 948

Other assets 920 (246) 674

Total (3,619) 587 (3,032)

Interest ExpenseDeposits and savings accounts (201) (7,843) (8,044)

SPRING loans (unsecured) 8 (155) (147)

Medium-Term Notes (1,547) - (1,547)

Other liabilities (187) (5) (192)

Total (1,927) (8,003) (9,930)

Net interest income (1,692) 8,590 6,898

NON-INTEREST INCOME2009 2008 VARIANCE$'000 $'000 +/(-) %

Fees and commissions 652 808 (19.3)

- Dividends 92 118 (22.0)

- Rental income from investment properties 3,146 3,068 2.5

- Others 373 184 102.7

Total non-interest income 4,263 4,178 2.0

Total non-interest income registered an increase of 2% to $4.3 million as compared to $4.2 million in the previous year.

Fees and commission decreased by 19.3% in tandem with the decline in the loan base. Rental income from investment

properties, constituting 73.8% of non-interest income, increased by 2.5% as some of the leases had been renewed

at a higher rental rate during the year. The increase in other income was attributed to $156,329 in profit on sale of

property, plant and equipment during the year.

OPERATING EXPENSES

2009 2008 VARIANCE$'000 $'000 +/(-) %

Staff costs 10,847 10,219 6.1

Depreciation of property, plant and equipment 1,264 958 31.9

Depreciation of investment properties 378 366 3.3

Other expenses 4,462 5,456 (18.2)

Total operating expenses 16,951 16,999 (0.3)

Total operating expenses decreased by a marginal 0.3%. The increase in depreciation of property, plant andequipment was mainly due to addition to costs of computer software during the year. The increases in staff costsand depreciation charges were more than offset by a decrease of 18.2% in other expenses which comprised mainlybusiness costs which had fallen in tandem with the reduced business activities.

IMPAIRMENT ALLOWANCES FOR LOANS AND ADVANCES

2009 2008 VARIANCE$'000 $'000 +/(-) %

Allowances for individual impairment 104 1,350 (92.3)

Allowances for collective impairment 7,372 12,010 (38.6)

Total impairment losses for loans and advances 7,476 13,360 (44.0)

Total impairment losses for loans and advances decreased by 44% or $5.9 million to $7.5 million mainly attributableto a decrease of 38.6% or $4.6 million in allowances for collective impairment.

Performance Review


2005 2006 2007 2008 2009


2009 2008 2007 2006 2005$’000 $’000 $’000 $’000 $’000

Operating Revenue* 63,404 66,436 63,491 50,060 37,028

Profit And Revenue ReservesProfit before tax 21,173 8,258 15,366 9,559 8,230Profit after tax 17,652 5,520 12,666 7,668 6,072Revenue Reserve 77,996 62,971 63,756 76,070 72,605

Share CapitalAuthorised - - - - 100,000Issued 117,199 117,199 117,199 84,430 75,061

Capital EmployedTotal Assets 1,640,680 1,781,969 1,725,546 1,427,425 1,184,765Net Assets 200,467 196,670 188,867 165,332 160,039

Volume Of BusinessLoans 1,048,663 1,392,687 1,304,372 1,021,919 974,656Deposits 1,389,440 1,459,082 1,438,790 1,166,736 893,787

Dividend And Earnings Per ShareDividend (net) 8,407 2,627 6,305 24,980 4,203Dividend per share (cents)** 8.00 2.50 6.00 40.60 7.00Earnings per share (cents)*** 16.80 5.25 13.23 9.20 9.33

Return After Tax On Total Assets (%) 1.08 0.31 0.73 0.54 0.51

Return After Tax On Net Assets (%) 8.81 2.81 6.71 4.64 3.79

Net Tangible Asset Per Share ($) 1.91 1.87 1.80 2.20 2.13

* The Operating Revenue for Years 2008 to 2005 incorporated in the previous annual reports, included the Operating Revenue of the subsidiary before eliminations on consolidation.The figures are now adjusted to reflect the consolidated Operating Revenue to conform to the Financial Statements.

** One-tier tax exempt dividend for Year 2007 to Year 2009 & gross dividends for Year 2005 & Year 2006.

*** Earnings per share is calculated based on the weighted average number of ordinary shares in issue during the year of 105,083,843 (Year 2008: 105,083,843, Year 2007: 95,701,683,Year 2006 : 83,317,266 & Year 2005 : 65,100,476) shares.

Profit before tax Profit after tax Total Assets Net Assets Loans Deposits

Volume Of Business$ Billion

2.0

1.5

1.0

0.5

0

Capital Employed$ Billion

2.0

1.5

1.0

0.5

0

Profit$ Million

25

20

15

10

5

02005 2006 2007 2008 2009 2005 2006 2007 2008 2009

5-Year Financial Summary

Financial Reports17 REPORT OF DIRECTORS | 20 STATEMENT BY DIRECTORS | 21 INDEPENDENT AUDITORS’ REPORT

22 STATEMENTS OF FINANCIAL POSITION | 24 CONSOLIDATED INCOME STATEMENT

25 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | 26 STATEMENTS OF CHANGES IN

EQUITY | 28 CONSOLIDATED STATEMENT OF CASH FLOWS | 29 NOTES TO FINANCIAL STATEMENTS

71 ADDITIONAL INFORMATION


The directors present their report together with the audited consolidated financial statements of the Group and statement of financial position and statement of changes in equity of the Company for the financial year ended 31 December 2009.

1 DIRECTORS

The directors of the Company in office at the date of this report are as follows:

Lee Sze Leong Tan Tong Guan Dr Joseph Yeong Wee Yong Lim Sin Hoa Tay Teng Guan Arthur Lee Sze Siong

Pursuant to Article 109 of the Company’s Articles of Association, Mr Lee Sze Leong and Mr Tay Teng Guan Arthur retire by rotation and being eligible, offer themselves for re-election.

Pursuant to Section 153(6) of the Singapore Companies Act, Chapter 50 (the “Act”), Mr Lim Sin Hoa who is over seventy years of age, retires and is eligible for re-appointment to hold office until the next Annual General Meeting.

2 ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITS BY MEANS OF THE ACQUISITION OF SHARES AND DEBENTURES

Neither at the end of the financial year nor at any time during the financial year did there subsist any arrangement whose object is to enable the directors of the Company to acquire benefits by means of the acquisition of shares or debentures in the Company or any other body corporate.

3 DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES

The directors of the Company holding office at the end of the financial year had no interests in the share capital and debentures of the Company and related corporations as recorded in the register of directors’ shareholdings kept by the Company under Section 164 of the Act except as follows:

Other holdings in which Holdings in the name of the director is deemed the director or nominee to have an interest At beginning At end At beginning At end Name of directors of the year of the year of the year of the year

Sing Investments & Finance LimitedSing Investments & Finance Limited (Ordinary shares)

Lee Sze Leong 216,721 216,721 28,100,300 28,114,300 Lee Sze Siong 300,395 300,395 28,100,300 28,114,300 Tay Teng Guan Arthur - - 4,068,818 4,068,818 Tan Tong Guan 101,540 101,540 1,190,100 1,190,100

By virtue of Section 7 of the Act, Messrs Lee Sze Leong and Lee Sze Siong are deemed to have an interest in the wholly-owned subsidiary of the Company at the beginning and at the end of the financial year.

There were no changes in any of the above mentioned interests in the Company between the end of the financial year and 21 January 2010.

Report of The Directors


4 DIRECTORS’ RECEIPT AND ENTITLEMENT TO CONTRACTUAL BENEFITS

Since the beginning of the financial year, no director has received or become entitled to receive a benefit which is required to be disclosed under Section 201(8) of the Singapore Companies Act, by reason of a contract made by the company or a related corporation with the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest except for salaries, bonuses and other benefits as disclosed in the financial statements.

During the financial year, the Company has engaged in transactions in the normal course of business with immediate family members of certain directors and with companies in which the directors have significant financial interests. However, the directors have not received, nor will they become entitled to receive, any benefits arising out of these transactions other than those which they may be entitled to as customers or as shareholders of these companies.

5 SHARE OPTIONS

(a) Options to take up unissued shares

During the financial year, no option to take up unissued shares of the Company or its subsidiary was granted.

(b) Options exercised

During the financial year, there were no shares of the Company or its subsidiary issued by virtue of the exercise of an option to take up unissued shares.

(c) Unissued shares under option

At the end of the financial year, there were no unissued shares of the Company or its subsidiary under option.

6 AUDIT COMMITTEE

The members of the Audit Committee during the financial year and at the date of this report are:

Tan Tong Guan (Chairman) Dr Joseph Yeong Wee Yong Tay Teng Guan Arthur

They are all independent non-executive directors.

The Audit Committee performs the functions specified by Section 201B of the Act, the Listing Manual and the Best Practices Guide of the Singapore Exchange, and the Code of Corporate Governance.

The Audit Committee has held 5 meetings since the last Annual General meeting. In performing its functions, the Audit Committee met with the Company’s external and internal auditors to discuss the scope of their work, the results of their examination and evaluation of the Company’s internal accounting control system.

The Audit Committee also reviewed the following:

a) the audit plans and results of the internal auditors’ examination and evaluation of the Group’s systems of internal accounting controls;

b) the Group’s financial and operating results and accounting policies;

c) the financial statements of the Company and the consolidated financial statements of the Group before their submission to the directors of the Company and external auditors’ report on those financial statements;

d) the quarterly, half-yearly and annual announcements as well as the related press releases on the results and financial position of the Company and the Group;



6 AUDIT COMMITTEE (cont’d)

e) the co-operation and assistance given by the management to the Group’s external auditors; and

f) the re-appointment of the external auditors of the Group.

The Audit Committee has full access to and has the co-operation of the management and has been given the resources required for it to discharge its function properly. It has full discretion to invite any director or executive officer to attend its meetings. The external and internal auditors have unrestricted access to the Audit Committee.

The Audit Committee has recommended to directors the nomination of Deloitte & Touche LLP for re-appointment as external auditors of the Group at the forthcoming Annual General Meeting of the Company.

7 AUDITORS

The auditors, Deloitte & Touche LLP, have expressed their willingness to accept re-appointment.

ON BEHALF OF THE BOARD OF DIRECTORS


Tan Tong GuanDirector

19 February 2010



In the opinion of the directors:

(a) the consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Company as set out on pages 22 to 70 are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2009 and of the results, changes in equity and cash flows of the Group and changes in equity of the Company for the financial year then ended; and

(b) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due.

ON BEHALF OF THE BOARD OF DIRECTORS


Tan Tong GuanDirector

19 February 2010


Statement By Directors

TO THE MEMBERS OF SING INVESTMENTS & FINANCE LIMITED

We have audited the accompanying financial statements of Sing Investments & Finance Limited (the “Company”) and its subsidiary (the “Group”), which comprise the statements of financial position of the Group and the Company as at 31 December 2009, and the income statement, statement of comprehensive income, statement of changes in equity and statement of cash flows of the Group and the statement of changes in equity of the Company for the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 22 to 70.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with the provisions of the Singapore Companies Act, Cap. 50 (the “Act”) and Singapore Financial Reporting Standards. This responsibility includes: devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair profit and loss account and balance sheet and to maintain accountability of assets; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion,

a) the consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2009 and of the results, changes in equity and cash flows of the Group and changes in equity of the Company for the year ended on that date; and

b) the accounting and other records required by the Act to be kept by the Company and by the subsidiary incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act.

Deloitte & Touche LLPPublic Accountants andCertified Public AccountantsSingapore

Giam Ei LeenPartner

19 February 2010

Independent Auditors’ Report


Group Company Note 2009 2008 2009 2008 $’000 $’000 $’000 $’000

ASSETS

Current assetsCash on deposit, at banks and in hand 252,113 52,249 252,054 52,168Other assets 6 5,178 5,045 5,178 5,045Investments 7 254,411 240,564 254,163 240,356Loans and advances due within twelve months 8 369,028 491,951 369,028 491,951Statutory deposit with the Monetary Authority of Singapore (“MAS”) 33,863 44,076 33,863 44,076Total current assets 914,593 833,885 914,286 833,596

Non-current assetsProperty, plant and equipment 9 20,118 20,630 20,118 20,630Investment properties 10 26,334 26,718 26,334 26,718Subsidiary 11 - - 25 25Loans and advances due after twelve months 8 679,635 900,736 679,635 900,736Total non-current assets 726,087 948,084 726,112 948,109

Total assets 1,640,680 1,781,969 1,640,398 1,781,705


Statements Of Financial PositionAs at 31 December 2009

Group Company Note 2009 2008 2009 2008 $’000 $’000 $’000 $’000

LIABILITIES AND EQUITY

Current liabilitiesDeposits and savings accounts of customers 13 1,389,440 1,459,082 1,390,159 1,459,784Other liabilities 14 18,731 30,358 18,249 29,869Interest bearing borrowings 15 4,000 21,000 4,000 21,000Medium-term notes 18 - 50,000 - 50,000SPRING loans due within twelve months (unsecured) 16 8,908 7,012 8,908 7,012Provision for employee benefits 17 205 225 205 225Current tax payable 6,940 5,270 6,940 5,270Total current liabilities 1,428,224 1,572,947 1,428,461 1,573,160

Non-current liabilitiesSPRING loans due after twelve months (unsecured) 16 11,054 8,966 11,054 8,966Deferred tax liabilities 12 935 3,386 903 3,359Total non-current liabilities 11,989 12,352 11,957 12,325

Total liabilities 1,440,213 1,585,299 1,440,418 1,585,485

Equity attributable to equity holders of the CompanyShare capital 19 117,199 117,199 117,199 117,199Reserves 20 83,268 79,471 82,781 79,021Total equity 200,467 196,670 199,980 196,220

Total liabilities and equity 1,640,680 1,781,969 1,640,398 1,781,705

See accompanying notes to financial statements.

Statements Of Financial PositionAs at 31 December 2009


Note 2009 2008 $’000 $’000

RevenueInterest income and hiring charges 23 63,404 66,436Interest expense 23 (22,067) (31,997)Net interest income and hiring charges 41,337 34,439

Fees and commissions 652 808Dividends 23 92 118Rental income from investment properties 3,146 3,068Other income 23 373 184Income before operating expenses 45,600 38,617

Staff costs 23 (10,847) (10,219)Depreciation of property, plant and equipment 9 (1,264) (958)Depreciation of investment properties 10 (378) (366)Other operating expenses 23 (4,462) (5,456)Profit from operations before impairment losses 28,649 21,618

Allowances for impairment losses on loans and advances 8 (7,476) (13,360)Profit before income tax 21,173 8,258

Income tax expense 24 (3,521) (2,738)Profit for the year attributable to equity holders of the Company 17,652 5,520

Earnings per share (cents)- Basic 25 16.8 5.25- Diluted 25 16.8 5.25



Consolidated Income StatementYear ended 31 December 2009

2009 2008 $’000 $’000

Profit for the year 17,652 5,520

Available-for-sale financial assets- (Losses) Gains arising during the year (13,771) 12,210

- Deferred tax adjustment 2,543 (3,622)

Other comprehensive (loss) income for the year, net of tax (11,228) 8,588

Total comprehensive income for the year attributable to equity holders of the company 6,424 14,108


Consolidated Statement Of Comprehensive IncomeYear ended 31 December 2009


Fair Share Statutory value Accumulated Note capital reserve reserve profits Total $’000 $’000 $’000 $’000 $’000Group

At 1 January 2008 117,199 49,367 7,912 14,389 188,867

Total comprehensive income for the year - - 8,588 5,520 14,108

Transfer from accumulated profits to statutory reserve - 2,759 - (2,759) -

Final one-tier tax exempt dividend paid for financial year 2007 of 6 cents per share - - - (6,305) (6,305)

At 31 December 2008 117,199 52,126 16,500 10,845 196,670

Total comprehensive (loss) income for the year - - (11,228) 17,652 6,424


Final one-tier tax exempt dividend paid for financial year 2008 of 2.5 cents per share 26 - - - (2,627) (2,627)

At 31 December 2009 117,199 60,951 5,272 17,045 200,467



Statements Of Changes In EquityYear ended 31 December 2009

Fair Share Statutory value Accumulated Note capital reserve reserve profits Total $’000 $’000 $’000 $’000 $’000Company

At 1 January 2008 117,199 49,367 7,661 14,064 188,291

Total comprehensive income for the year - - 8,716 5,518 14,234


Final one-tier tax exempt dividend paid for financial year 2007 of 6 cents per share - - - (6,305) (6,305)

At 31 December 2008 117,199 52,126 16,377 10,518 196,220

Total comprehensive (loss) income for the year - - (11,262) 17,649 6,387


Final one-tier tax exempt dividend paid for financial year 2008 of 2.5 cents per share 26 - - - (2,627) (2,627)

At 31 December 2009 117,199 60,951 5,115 16,715 199,980


Statements Of Changes In EquityYear ended 31 December 2009


2009 2008 $’000 $’000Operating activitiesProfit before income tax 21,173 8,258Adjustments for: Impact of accrual of interest income (1,017) (511) Impact of accrual of interest expense (12,073) 2,314 Depreciation of property, plant and equipment 1,264 958 Depreciation of investment properties 378 366 Property, plant and equipment and investment properties written off 238 9 Profit on disposal of property, plant and equipment (156) - Allowances for impairment losses on loans and advances 7,476 13,360 Dividends receivable (84) - Operating cash flows before movements in working capital 17,199 24,754

Changes in working capitalOther assets 709 (432)Loans and advances 336,548 (101,675)Statutory deposit with the MAS 10,213 (4,997)Deposits and savings accounts of customers (69,642) 20,292Other liabilities 2,128 487SPRING loans 3,984 375Provision for employee benefits (20) 32Cash generated from (used in) operations 301,119 (61,164)Income taxes paid (1,759) (2,220)Net cash generated from (used in) operating activities 299,360 (63,384)

Investing activitiesPurchase of investments (53,891) (43,989)Purchase of property, plant and equipment and investment properties (2,666) (2,723)Proceeds from disposal of investments 26,500 - Proceeds from disposal of property, plant and equipment 156 - Dividends received 32 - Net cash used in investing activities (29,869) (46,712)

Financing activitiesDividends paid (2,627) (6,305)Funding from interest bearing borrowings 4,000 21,000Repayment of interest bearing borrowings (21,000) - Repayment of medium-term notes (50,000) - Net cash (used in) generated from financing activities (69,627) 14,695

Net increase (decrease) in cash and cash equivalents 199,864 (95,401)Cash and cash equivalents at beginning of the year 52,249 147,650Cash and cash equivalents at end of the year 252,113 52,249



Consolidated Statement Of Cash FlowsYear ended 31 December 2009

1 GENERAL

The Company (Registration Number 196400348D) is incorporated in the Republic of Singapore and has its principal place of business and registered office at 96 Robinson Road, #01-01 SIF Building, Singapore 068899. The Company is listed on the Singapore Exchange Securities Trading Limited. The financial statements are expressed in Singapore dollars, which is the functional currency of the Company.

The principal activities of the Company are those of a licensed finance company. The principal activities of the subsidiary are those of a nominee service company.

The consolidated financial statements of the Group and statement of financial position and statement of changes in equity of the Company for the year ended 31 December 2009 were authorised for issue by the Board of Directors on 19 February 2010.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.1 BASIS OF ACCOUNTING

The financial statements have been prepared in accordance with the historical cost basis except for the revaluation of certain financial instruments, and are drawn up in accordance with the provisions of the Singapore Companies Act and Singapore Financial Reporting Standards (“FRS”).

2.2 ADOPTION OF NEW AND REVISED STANDARDS

In the current financial year, the Group has adopted all the new and revised FRSs and Interpretations of FRS (“INT FRS”) that are relevant to its operations and effective for annual periods beginning on or after 1 January 2009. The adoption of these new/revised FRSs and INT FRSs does not result in changes to the Group’s and Company’s accounting policies and has no material effect on the amounts reported for the current or prior years except as disclosed below:

(a) FRS 1 - Presentation of Financial Statements (Revised)

FRS 1 (2008) has introduced terminology changes (including revised titles for the financial statements) and changes in the format and content of the financial statements. In addition, the revised Standard requires the presentation of a third statement of financial position at the beginning of the earliest comparative period presented if the entity applies new accounting policies retrospectively or makes retrospective restatements or reclassifies items in the financial statements.

(b) Amendments to FRS 107 Financial Instruments : Disclosures – Improving Disclosures about Financial Instruments

The amendments to FRS 107 expand the disclosures required in respect of fair value measurements and liquidity risk. The Group has elected not to provide comparative information for these expanded disclosures in the current year in accordance with the transitional reliefs offered in these amendments.

At the date of authorisation of these financial statements, the following FRSs, INT FRSs and amendments to FRS that are relevant to the Group and the Company were issued but not effective:

• FRS 27 (Revised) Consolidated and Separate Financial Statements; and FRS 103 (Revised) Business Combinations.

• Improvements to Financial Reporting Standards (issued in June 2009)

Notes to Financial Statements


2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)

2.2 ADOPTION OF NEW AND REVISED STANDARDS (cont’d)

Consequential amendments were also made to various standards as a result of these new/revised standards.

The management anticipates that the adoption of the above FRSs, INT FRSs and amendments to FRS in future periods will not have a material impact on the financial statements of the Group and the Company in the period of their initial adoption except for the following:

FRS 27 (Revised) Consolidated and Separate Financial Statements; and FRS 103 (Revised) Business Combinations

FRS 27 (Revised) is effective for annual periods beginning on or after July 1, 2009. FRS 103 (Revised) is effective for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after July 1, 2009.

Apart from matters of presentation, the principal amendments to FRS 27 that will impact the Group concern the accounting treatment for transactions that result in changes in a parent’s interest in a subsidiary. It is likely that these amendments will significantly affect the accounting for such transactions in future accounting periods, but the extent of such impact will depend on the detail of the transactions, which cannot be anticipated. The changes will be adopted prospectively for transactions after the date of adoption of the revised Standard and, therefore, no restatements will be required in respect of transactions prior to the date of adoption.

Similarly, FRS 103 is concerned with accounting for business combination transactions. The changes to the Standard are significant, but their impact can only be determined once the detail of future business combination transactions is known. The amendments to FRS 103 will be adopted prospectively for transactions after the date of adoption of the revised Standard and, therefore, no restatements will be required in respect of transactions prior to the date of adoption.

Amendments to FRS 7 Statement of Cash Flows

The amendments (part of Improvements to FRSs issued in June 2009) specify that only expenditures that result in a recognised asset in the statement of financial position can be classified as investing activities in the statement of cash flows. Consequently, cash flows in respect of development costs that do not meet the criteria in FRS 38 Intangible Assets for capitalisation as part of an internally generated intangible asset (and, therefore, are recognised in profit or loss as incurred) will be reclassified from investing to operating activities in the statement of cash flows. The amendments to FRS 7 will be adopted for periods beginning on or after January 1, 2010.

2.3 BASIS OF CONSOLIDATION

The consolidated financial statements incorporate the financial statements of the Company and an entity controlled by the Company (its subsidiary). Control is achieved where the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

Where necessary, adjustments are made to the financial statements of the subsidiary to bring their accounting policies into line with the Company.

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

In the Company’s financial statements, investment in subsidiary is carried at cost less any impairment in net recoverable value that has been recognised in profit or loss.

2.4 FINANCIAL INSTRUMENTS

Financial assets and financial liabilities are recognised on the Group’s statement of financial position when the Group becomes a party to the contractual provisions of the instrument.




2.4 FINANCIAL INSTRUMENTS (cont’d)

Effective interest method

The effective interest method is a method of calculating the amortised cost of a financial instrument and of allocating interest income or expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts or payments (including all fees on points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial instrument, or where appropriate, a shorter period. Income and expense is recognised on an effective interest basis for debt instruments.

Financial assets

Investments are recognised and de-recognised on a trade date where the purchase or sale of an investment is under a contract whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially measured at fair value plus transaction costs.

Financial assets are classified into the following specified categories: “available-for-sale financial assets” and “loans and receivables”. The classification depends on the nature and purpose of financial assets and is determined at the time of initial recognition.

(a) Available-for-sale financial assets

The Group’s investments in equity securities and certain debt securities are classified as available-for-sale financial assets and are stated at fair value. Fair value is determined in the manner described in Note 4a(v). Gains and losses arising from changes in fair value are recognised in other comprehensive income with the exception of impairment losses and interest calculated using the effective interest method which are recognised directly in profit or loss. Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously recognised in other comprehensive income and accumulated in fair value reserve is reclassified to profit or loss for the period. Dividends on available-for-sale equity instruments are recognised in profit or loss when the Group’s right to receive payments is established.

(b) Loans and receivables

Loans and advances and other assets that have fixed or determinable payments that are not quoted in an active market are classified as “loans and receivables”. Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate method, except for short-term receivables when the recognition of interest would be immaterial.





(c) Impairment of financial assets

A financial asset is assessed at the end of each reporting period to determine whether there is any objective evidence that it is impaired. A financial asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset.

An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount, and the present value of the estimated future cash flows discounted at the original effective interest rate. An impairment loss in respect of an available-for-sale financial asset is calculated by reference to its current fair value.

Individually significant financial assets are tested for impairment on an individual basis. The remaining financial assets are assessed collectively in groups that share similar credit risk characteristics.

All impairment losses are recognised in the profit or loss. Any cumulative loss in respect of an available-for-sale financial asset recognised previously in other comprehensive income are reclassified to profit or loss.

Impairment losses in respect of financial assets measured at amortised cost and available-for-sale debt securities are reversed if the subsequent increase in fair value can be related objectively to an event occurring after the impairment loss was recognised.

With the exception of available-for-sale equity instruments, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment loss was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.

Impairment losses once recognised in the profit or loss in respect of available-for-sale equity securities are not reversed through the profit or loss. Any subsequent increase in fair value of such assets is recognised directly in other comprehensive income.

Calculation of recoverable amount

Loans and advances

Future cash flows in a group of financial assets assessed for collective impairment are estimated on the basis of the contractual cash flows of the assets in the group and historical loss experience for assets with credit characteristics similar to those in the group. Historical loss experience is adjusted on the basis of current observable data to reflect the effects of current conditions that did not affect the period on which the historical loss experience is based and to remove the effects of conditions in the historical period that do not exist currently. Portfolio impairment allowance is created for collective impairment of loans and advances.

When a loan is uncollectible, it is written off against the related impairment allowance. Subsequent recoveries of amounts previously written off are credited directly to the profit or loss. Changes in the carrying amount of the allowance account are recognised in profit or loss.





(d) Derecognition of financial assets

The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.

Financial liabilities and equity instruments

Classification as debt or equity

Financial liabilities and equity instruments issued by the Group are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument.

(a) Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs.

(b) Other financial liabilities

Other liabilities are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, using the effective interest rate method, with interest expense recognised on an effective yield basis.

Medium-term notes, interest-bearing bank loans and overdrafts are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method. Any difference between the proceeds (net of transaction costs) and the settlement or redemption of borrowings is recognised over the term of the borrowings in profit or loss in the period in which they are incurred.

(c) Derecognition of financial liabilities

The Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or they expire.

2.5 OPERATING LEASES

When entities within the Group are lessees of an operating lease

Rentals payable under operating leases are charged to profit or loss on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.

In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.




2.5 OPERATING LEASES (cont’d)

When entities within the Group are lessors of an operating lease

Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the time pattern in which the used benefit derived from the leased asset is diminished. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

2.6 PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The costs of the day-to-day servicing of property, plant and equipment are recognised in the profit or loss as incurred.

Gains or losses arising from the retirement or disposal of property, plant and equipment are determined as the difference between the estimated net disposal proceeds and the carrying amount of the asset and are recognised in the profit or loss on the date of retirement or disposal.

Depreciation on other property, plant and equipment is recognised in the profit or loss on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment.

The estimated useful lives are as follows:

Leasehold land - remaining life of the lease Freehold and leasehold buildings - shorter of 50 years and remaining life of the lease Furniture, office equipment and motor vehicles - 5 years Renovation - 5 years Computers - 3 years

Depreciation methods, useful lives and residual values are reviewed, and adjusted as appropriate, at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. Fully depreciated assets still in use are retained in the financial statements.

2.7 INVESTMENT PROPERTIES

Investment property is property held either to earn rental income or capital appreciation or both. It does not include properties for sale in the ordinary course of business, used in the production or supply of goods or services, or for administrative purposes.

Investment property is stated at cost less accumulated depreciation and impairment losses. Cost includes expenditure that is directly attributable to the acquisition or construction of the asset.

No depreciation is provided on freehold land classified as investment properties. Depreciation on leasehold land and freehold and leasehold buildings classified as investment properties is recognised in the profit or loss on a straight-line basis over the estimated useful lives as follows:




2.7 INVESTMENT PROPERTIES (cont’d)

Leasehold land - remaining life of the lease Freehold and leasehold buildings - shorter of 50 years and remaining life of the lease

Depreciation methods, useful lives and residual values are reviewed, and adjusted as appropriate, at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. Fully depreciated assets still in use are retained in the financial statements.

2.8 IMPAIRMENT - NON-FINANCIAL ASSETS

The carrying amounts of the Group’s non-financial assets, are reviewed at the end of each reporting period to determine whether there is any indication of impairment. If any such indication exists, the assets’ recoverable amounts are estimated.

An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its estimated recoverable amount.

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or cash-generating unit. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs.

Impairment losses recognised in prior periods are assessed at the end of each reporting period for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

2.9 PREPAID COMMISSION ON LOANS AND ADVANCES

Commission paid on loans and advances are deferred and recognised as an expense over the tenor of the loans and advances.

For settled loans, the remaining portion of the prepaid commission is expensed immediately to the profit or loss on the date of settlement.

2.10 PROVISION

Provision are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.




2.11 REVENUE RECOGNITION

(a) Interest income and expense

Interest income and expense are recognised in the profit or loss as they accrue, taking into account the effective yield of the asset or liability or an applicable fixed or floating rate. Where charges are added to the principal financed at the commencement of the period, the general principle adopted for crediting income to the profit or loss is to spread the income over the period in which the repayments are due using the following bases for the various categories of financing business:-

Income earned on hire purchase

Term charges on hire purchase transactions are accounted for using the Rule of 78 (sum of digits) method. The balance of such term charges at the financial year end is carried forward as unearned charges.

Income earned on loans, factoring accounts and debt securities

Interest income is recognised in the profit or loss using the effective interest method.

Income from bank deposits

Interest income from bank deposits is accrued on a time-apportioned basis using the effective interest method.

(b) Fee and commission income

Fee and commission income are recognised in the profit or loss on an accrual basis when the services are rendered.

(c) Dividend income

Dividend income is recognised when the Group’s right to receive payment is established.

(d) Rental income

Rental income receivable under operating leases is recognised in the profit or loss on a straight-line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income to be received. Contingent rentals are recognised as income in the accounting period in which they are earned.

2.12 EMPLOYEE BENEFITS

(a) Defined contribution plans

Payments to defined contribution retirement benefit plans are charged as an expense as they fall due. Payments made to state-managed retirement benefit schemes, such as the Singapore Central Provident Fund, are dealt with as payments to defined contribution plans where the Group’s obligations under the plans are equivalent to those arising in a defined contribution retirement benefit plan.




2.12 EMPLOYEE BENEFITS (cont’d)

(b) Short-term benefits

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.

A provision is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(c) Employee leave entitlement

Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to the end of the reporting period.

2.13 INCOME TAX EXPENSE

Income tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the income statement and statement of comprehensive income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are not taxable or tax deductible. The Group’s liability for current tax is calculated using tax rates (and tax laws) that have been enacted or substantively enacted in Singapore where the Company and subsidiary operate by the end of the reporting period.

Deferred tax is recognised on the differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised based on the tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to items credited or debited outside profit or loss (either in other comprehensive income or directly in equity), in which case the tax is also recognised outside profit or loss (either in other comprehensive income or directly in equity).

2.14 CASH AND CASH EQUIVALENTS

Cash and cash equivalents comprise cash balances and bank deposits that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.



3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Group’s accounting policies, which are described in Note 2, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revision to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of revision and future periods if the revision affects both current and future periods.

Management discussed with the Audit Committee the development, selection, disclosure, and application of the Group’s critical accounting policies and estimates, and the application of these policies and estimates.

(a) Critical judgements in applying the entity’s accounting policies

The management are of the opinion that any instances of application of judgements are not expected to have a significant effect on the amounts recognised in the financial statements.

(b) Key sources of estimation uncertainty

The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below.

Impairment losses on loans, advances and receivables

The Group reviews its loan portfolio to assess impairment at least on a semi-annual basis. To determine whether an impairment loss should be recorded in the profit or loss, the Group makes judgements as to whether there is any observable data indicating a measurable decrease in the estimated future cash flows of the loan portfolio. The evidence may include observable data indicating adverse changes in the payment status of certain groups of borrowers or local economic conditions that correlate with default in the loan portfolio.

In addition, management uses estimates based on historical loss experience for loans, advances and receivables with credit risk characteristics and objective evidences of impairment similar to those in the loan portfolio. The methodology and assumptions used are reviewed regularly to reduce any differences between estimates and actual loss experience.

4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT

(a) Financial risk management policies and objectives

The Group has exposure to the following risks from its use of financial instruments:

- credit risk - liquidity risk - market risk - operational risk

The Group’s operations are denominated in Singapore dollars. Hence, the Group is not exposed to material foreign exchange movements.

This note presents information about the Group’s exposure to each of the above risks, the Group’s objectives, policies and processes for measuring and managing risk, and the Group’s management of capital.



4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)

Risk management framework

The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The Board has set up the Group Asset and Liability (ALCO) and Credit Risk Management committees, which are responsible for developing and monitoring the Group risk management policies in their specific areas. The committees report regularly to the Board of Directors on their activities. In addition, the Audit Committee which is appointed by the Board reviews the adequacy and effectiveness of the Group’s internal controls.

The Group has in place processes to review and monitor the implementation of the Group’s policies and procedural guidelines used for financial risk management. Internal audits are conducted on an on-going basis to confirm that these policies are functioning effectively.

(i) Credit risk

Credit risk is one of the primary risks in financial lending and is the risk of financial loss to the Financial Institution if a customer or counterparty (guarantor) to a loan fails to meet its contractual obligations. Credit exposures also include the debt securities held whose conditions may be impacted to varying degrees by continuing turmoil in the global financial markets.

The Group’s credit exposure is concentrated in Singapore. In the event of a financial crisis or an economic downturn some customers could experience higher levels of financial stress and the Group may incur increased defaults and write-offs, and be required to increase the level of provisioning. Such actions could diminish available capital and could directly affect the results of operations, liquidity, capital resources and financial condition of the Group.

Any decline in Singapore asset markets, including equity, property and other asset markets could also impact the Group’s operations and profitability. Declining asset prices will impact the value of securities held as collaterals against customer borrowings.

For risk management reporting purposes, the Group considers and consolidates all elements of credit risk exposure including the default risk of the individual obligor, security risk and market/industry risk.

Credit policies are formulated covering collateral requirements, credit assessment, risk grading and reporting, documentary and legal procedures, and compliance with regulatory and statutory requirements. All credit facilities, which must be fully secured, require the approval by Management or the Loan Committee as appropriate. All collateral assets must be tangible and accessible or marketable in Singapore.

The Group has in place a monitoring system to identify early symptoms of problematic loan accounts. A risk grading system is used in determining where impairment provisions may be required against specific credit exposures. Risk grades are subject to regular reviews and credit exposures take into consideration of stress testing of the fair value of collateral and other security enhancements held against the loans and advances.

The Group establishes an allowance for impairment losses that represents its estimate of incurred losses in its loan portfolio. The main components of this allowance are a specific loss component that relates to individually significant exposures, and a collective loan loss allowance.




Maximum exposure to credit risk

The carrying amount of financial assets recorded in the financial statements, grossed up for any allowances for losses represents the Group’s maximum exposure to credit risk without taking account of the value of any collateral obtained.

Set out below is a breakdown of the net (of allowances for impairment) amounts of loans and advances by loan types (based on underlying collateral assets):

Group and Company Performing Non-performing Total $’000 $’000 $’000 Loan type

31 December 2009

Private residential 218,649 4,752 223,401 HDB flats 8,961 1,102 10,063 Commercial properties 265,680 1,854 267,534 Shipping 20,802 - 20,802 Share loans 10,668 - 10,668 Machinery and equipment 41,220 1,394 42,614 Motor vehicles 140,919 1,393 142,312 Land and construction 283,612 - 283,612 Block discounting 67,522 - 67,522 Factoring and accounts receivables - - - Others 1,559 49 1,608 1,059,592 10,544 1,070,136 Less: Collective impairment (21,473) - (21,473) Total 1,038,119 10,544 1,048,663

31 December 2008

Private residential 345,018 8,259 353,277 HDB flats 9,844 1,750 11,594 Commercial properties 310,217 1,454 311,671 Shipping 23,556 - 23,556 Share loans 10,066 4 10,070 Machinery and equipment 45,943 1,343 47,286 Motor vehicles 176,280 1,342 177,622 Land and construction 384,636 - 384,636 Block discounting 86,671 - 86,671 Factoring and accounts receivables 69 - 69 Others 316 19 335 1,392,616 14,171 1,406,787 Less: Collective impairment (14,100) - (14,100) Total 1,378,516 14,171 1,392,687




Collaterals

The Group holds collateral against loans and advances to customers. The main types of collateral obtained by the Group are as follows:

- for personal housing loans, mortgages over residential properties and HDB flats; - for commercial property loans, charges over the properties being financed; - for land and construction loans, charges over the developing properties being financed; - for motor vehicles loans and block discounting loans, charges over the vehicles financed; - for share loans, listed securities of Singapore; and - for other loans, charges over business assets such as premises, barges and vessels, machineries, trade receivables or deposits. The nature and fair value of collateral held as security on individually impaired loans and advances are as follows: Group and Company 2009 2008 $’000 $’000

Property 19,945 25,247 Equipments 3,156 4,374 Motor vehicles 2,347 1,978 25,448 31,599

The Group does not disclose the fair value of collateral held as security on loans and advances past due but not impaired as it is not practicable to do so.

The nature and carrying amount of assets obtained by taking possession of collateral held as security are as follows: Group and Company 2009 2008 $’000 $’000

Property - 552 Motor vehicles and equipments 132 156 132 708

Credit quality

The Group categories its loans and advances in accordance with MAS Notice to Finance Companies No. 811 “Credit Files, Grading and Provisioning” issued by the Monetary Authority of Singapore (MAS). In addition, loans and advances are required under FRS107 to be categorised into “impaired”, “past due but not impaired” and “neither past due nor impaired”. Past due loans refer to loans that are overdue by one day or more. Impaired loans are non performing loans with specific allowances made.

(a) Performing loans

- Pass grades indicate that the timely repayment of the outstanding credit facilities is not in doubt. - Special mention grades indicates that the credit facilities exhibit potential weaknesses that, if not corrected in a timely manner, may adversely affect future repayments and warrant close attention by the Group.




(b) Non-performing loans

- Substandard grades indicate that the credit facilities exhibit definable weaknesses either in respect of business, cash flow or financial position of the borrower that may jeorpardise repayment on existing terms. - Doubtful grades indicate that the credit facilities exhibit severe weaknesses such that the prospect of full recovery of the outstanding credit facilities is questionable and the prospect of a loss is high, but the exact amount remains undeterminable. - Loss grades indicate the amount of loan recovery is assessed to be insignificant.

Set out below is a breakdown of the amounts of loans and advances by loan grading:

2009 2008 $’000 $’000 Loans grading

Loans and advances to customers Individually impaired Substandard 10,544 14,171 Doubtful - - Loss 6,870 7,386 Gross amount 17,414 21,557 Less: Allowance for impairment (6,870) (7,386) Carrying amount 10,544 14,171

Past due but not impaired Pass 4,361 42 Special mention 31,630 11,353 Carrying amount 35,991 11,395

Neither past due nor impaired Pass 882,292 1,265,442 Special mention 141,309 115,779 Less: Collective impairment (21,473) (14,100) Carrying amount 1,002,128 1,367,121

Total 1,048,663 1,392,687

Ageing of loans and advances that are past due but not impaired < 3 months 35,991 11,395

Bad debts will be written off when debt recovery is impossible, e.g. borrower has been made bankrupt, or all actions have been exhausted. Approval of the Managing Director or Credit Risk Management Committee as appropriate are requested for write-off of bad debts above certain amounts. Any proposal for write off of director and director-related loans must be accepted by the Board of Directors and approved by the MAS.

The Credit Risk Management Committee is delegated the authority by the Board to oversee the Group’s credit activities and risk management process, including reviewing periodically the credit policies, guidelines and procedures of the Group, evaluating the risk profile of the Group’s loan portfolio, reviewing and managing the quality of its loan assets etc.




Concentration of credit risk

The Group monitors concentrations of credit risk by sector. An analysis of concentrations of credit risk at the end of the reporting period is shown below: Loans and advances to customers 2009 2008 $’000 $’000

Carrying amount 1,048,663 1,392,687

Concentration by sector Hire purchase finance 175,661 217,779 Factoring - 18 Housing loans 121,642 189,089 Block discounting 67,522 86,671 Manufacturing 4,440 6,084 Building and construction 264,296 315,795 General commerce 48,673 65,677 Transport, storage and communication 25,676 32,915 Financial institutions, and investment and holding companies 109,254 144,420 Professional and individuals 218,164 296,508 Others 34,808 51,831 1,070,136 1,406,787 Less: Collective impairment (21,473) (14,100) Total 1,048,663 1,392,687




(ii) Liquidity risk

Liquidity risk is the risk that the Group is unable to service its cash obligations in the future. The Group’s principal source of funds is from deposit collections in Singapore which is mainly utilised for funding loans, operating expenses and maintenance of reserves in compliance with statutory requirements. In the event of a financial crisis, a pro-longed decline in the Singapore economy could impact the Group’s ability to replace, in a timely manner, maturing liabilities and to access to the capital necessary to fund and grow.

The daily liquidity position is closely monitored via daily report covering the next 7 days’ funding needs. In addition, projected funds flow position for the next 6 months is reviewed on a monthly basis. This is supplemented by the annual budget which provides the projection of the funding requirements for the following year based on the budgeted increase in business activities.

All liquidity policies and procedures are subject to review and approval by ALCO. A summary report, including any exceptions and remedial action, is submitted on a semi-annual basis to the Board of Directors. The Committee meets on a quarterly basis to review the liquidity requirements and the need to make any revision or on a ‘need-to’ basis to address a compelling issue.

The Group’s liquidity risk is mitigated by its maintenance of the minimum cash balance and minimum liquid assets balance as required by MAS, the latter being the key measure for liquidity risk. For this purpose, liquid assets comprise notes and coins which are legal tender in Singapore and Singapore Government Securities. The liabilities base comprises deposits from customers, Medium-Term Notes (MTN) and net deposits from financial institutions.

Furthermore, the Group’s ability to access the credit lines extended by its Bankers and MTN facility provides alternative sources for its short-term and medium term funding requirements respectively.

The Group’s strategy to managing liquidity risk above has not changed from prior periods. The management and ALCO will continually assess the balance of capital and debt funding of the Group closely.

At 31 December 2009, the Group had available S$103 million (2008 : S$111 million) of undrawn committed credit lines in respect of which all conditions precedent had been met.




The following table analyses the assets and liabilities of the Group and the Company into maturity time bands based on the remaining time to contractual maturity as at end of the reporting period:

Up to 1 Over 1 to 3 Over 3 to 12 Over 1 to 5 Over 5 Non-specific Total month months months years years maturity $’000 $’000 $’000 $’000 $’000 $’000 $’000 Group

31 December 2009

Assets Statutory deposit

with the Monetary

Authority of Singapore 33,863 33,863 - - - - -

Singapore Government

securities 251,438 - - 4,449 51,215 195,774 -

Loans and advances

to customers 1,048,663 97,895 11,714 170,678 315,329 453,047 -

Cash on deposit,

at banks and in hand 252,113 45,537 32,008 174,568 - - -

Others 54,603 900 2,257 3,712 - - 47,734

Total Assets 1,640,680 178,195 45,979 353,407 366,544 648,821 47,734

Liabilities Deposits and savings

accounts of customers 1,389,440 198,859 300,236 775,635 95,225 - 19,485

Interest bearing

borrowings 4,000 4,000 - - - - -

SPRING loans 19,962 1,830 1,378 5,700 11,054 - -

Others 26,811 2,576 3,064 11,397 9,164 - 610

Total Liabilities 1,440,213 207,265 304,678 792,732 115,443 - 20,095

Total Equity 200,467 - - - - - 200,467

Total Liabilities and Equity 1,640,680 207,265 304,678 792,732 115,443 - 220,562

Net Liquidity Gap - (29,070) (258,699) (439,325) 251,101 648,821 (172,828)




Up to 1 Over 1 to 3 Over 3 to 12 Over 1 to 5 Over 5 Non-specific Total month months months years years maturity $’000 $’000 $’000 $’000 $’000 $’000 $’000 Group

31 December 2008


with the Monetary



securities 238,856 17,519 - 9,113 50,191 162,033 -

Loans and advances

to customers 1,392,687 85,056 61,503 223,840 360,963 661,325 -

Cash on deposit,

at banks and in hand 52,249 52,249 - - - - -

Others 54,101 1,093 1,681 1,819 - - 49,508

Total Assets 1,781,969 199,993 63,184 234,772 411,154 823,358 49,508



Interest bearing

borrowings 21,000 21,000 - - - - -

SPRING loans 15,978 1,394 1,140 4,478 8,966 - -

Medium-Term Notes 50,000 - - 50,000 - - -

Others 39,239 3,615 5,065 18,855 11,065 - 639


Total Equity 196,670 - - - - - 196,670






Up to 1 Over 1 to 3 Over 3 to 12 Over 1 to 5 Over 5 Non-specific Total month months months years years maturity $’000 $’000 $’000 $’000 $’000 $’000 $’000

Company

31 December 2009


with the Monetary



securities 251,438 - - 4,449 51,215 195,774 -

Loans and advances

to customers 1,048,663 97,895 11,714 170,678 315,329 453,047 -

Cash on deposit,

at banks and in hand 252,054 45,478 32,008 174,568 - - -

Others 54,380 900 2,257 3,464 - - 47,759

Total Assets 1,640,398 178,136 45,979 353,159 366,544 648,821 47,759



Interest bearing

borrowings 4,000 4,000 - - - - -

SPRING loans 19,962 1,830 1,378 5,700 11,054 - -

Others 26,297 2,593 3,064 11,397 9,132 - 111


Total Equity 199,980 - - - - - 199,980






Up to 1 Over 1 to 3 Over 3 to 12 Over 1 to 5 Over 5 Non-specific Total month months months years years maturity $’000 $’000 $’000 $’000 $’000 $’000 $’000 Company

31 December 2008


with the Monetary



securities 238,856 17,519 - 9,113 50,191 162,033 -

Loans and advances

to customers 1,392,687 85,056 61,503 223,840 360,963 661,325 -

Cash on deposit,

at banks and in hand 52,168 52,168 - - - - -

Others 53,918 1,093 1,681 1,611 - - 49,533

Total Assets 1,781,705 199,912 63,184 234,564 411,154 823,358 49,533



Interest bearing

borrowings 21,000 21,000 - - - - -

SPRING loans 15,978 1,394 1,140 4,478 8,966 - -

Medium-Term Notes 50,000 - - 50,000 - - -

Others 38,723 3,623 5,065 18,856 11,038 - 141


Total Equity 196,220 - - - - - 196,220


Net liquidity gap - (6,312) (229,444) (697,071) 268,947 823,358 (159,478)




The following is the expected contractual undiscounted cash outflow of financial liabilities, including interest payments:

Gross Carrying nominal Up to 1 Over 1 to 3 Over 3 to 12 Over 1 to 5 Non-specific amount outflow month months months years maturity $’000 $’000 $’000 $’000 $’000 $’000 $’000 Group

31 December 2009

Deposits and savings

accounts of customers 1,389,440 (1,399,297) (199,042) (301,005) (781,101) (98,664) (19,485)

Interest bearing

borrowings 4,000 (4,001) (4,001) - - - -

SPRING loans 19,962 (20,763) (1,835) (1,384) (5,815) (11,729) -

Total Liabilities 1,413,402 (1,424,061) (204,878) (302,389) (786,916) (110,393) (19,485)

Unrecognised Loan Commitments 292,604 (292,604) (292,604) - - - -

1,706,006 (1,716,665) (497,482) (302,389) (786,916) (110,393) (19,485)

31 December 2008



Interest bearing

borrowings 21,000 (21,124) (21,124) - - - -

SPRING loans 15,978 (16,658) (1,397) (1,145) (4,567) (9,549) -

Medium-Term Notes 50,000 (51,087) - - (51,087) - -



1,877,644 (1,918,525) (536,945) (293,371) (936,973) (138,586) (12,650)




Gross Carrying nominal Up to 1 Over 1 to 3 Over 3 to 12 Over 1 to 5 Non-specific amount outflow month months months years maturity $’000 $’000 $’000 $’000 $’000 $’000 $’000

Company

31 December 2009



Interest bearing

borrowings 4,000 (4,001) (4,001) - - - -

SPRING loans 19,962 (20,763) (1,835) (1,384) (5,815) (11,729) -



1,706,725 (1,717,386) (497,969) (302,389) (787,150) (110,393) (19,485)

31 December 2008

Deposits and

savings accounts of

customers 1,459,784 (1,498,776) (183,312) (292,226) (881,551) (129,037) (12,650)

Interest bearing

borrowings 21,000 (21,124) (21,124) - - - -

SPRING loans 15,978 (16,658) (1,397) (1,145) (4,567) (9,549) -

Medium-Term Notes 50,000 (51,087) - - (51,087) - -



1,878,346 (1,919,229) (537,417) (293,371) (937,205) (138,586) (12,650)




The negative net liquidity gap for the maturity band for up to 12 months as at 31 December 2009 (2008 : up to 12 months) is due to the fact that most of the fixed deposits constituting the main liability on the Group’s statement of financial position have relatively shorter maturity periods of up to 12 months as at 31 December 2009 (2008 : up to 12 months), as compared to the tenures of loans and advances which constitute the Group’s main asset. Typically, most of the deposits would be renewed and depending on the maturity periods, would cause an impact on the net liquidity gap accordingly.

On a quarterly basis, stress testing is done based on varying renewal rates to evaluate if the net liquidity gap is at an acceptable level.

(iii) Market risk

(1) Interest rate risk

The Group’s core operations are deposit taking and extension of credit facilities. The Group’s exposure to interest rates risk results from potential changes in value of these assets and liabilities as a result of movements in interest rates in the financial market in which it operates.

As interest rates changes over time, the Group may be exposed to a loss in earnings due to effects of fixed and floating interest rates of these assets and liabilities. As such, the interest rate spread between these two activities is monitored closely on an on-going basis to maximise its yields and minimise its risk profile. A system is in place to track market interest rate movements and to adjust on a timely basis the Group’s borrowing and lending rates.

The ALCO meets periodically to review the risk profile of the Group against the prevailing business and economic conditions, focusing on market and interest rate risks. The Committee relates structure of assets and liabilities to funding mismatches and interest rate repricing risks and ensures compliance with ratios, limits and guidelines set by the Board/management and the MAS.




In respect of interest-earning financial assets and interest-bearing financial liabilities, the following table indicates their effective weighted average interest rates at the end of the reporting period and the periods in which they reprice, or if earlier, the dates on which the instruments mature.

Effective Non- 3 months weighted average interest 0 - 3 to 1 - 5 interest sensitive months 1 year years > 5 years Total % $’000 $’000 $’000 $’000 $’000 $’000 Group

31 December 2009

Financial Assets Statutory deposit with the Monetary Authority of Singapore - 33,863 - - - - 33,863 Singapore Government securities 3.20 - - 4,449 51,215 195,774 251,438 Loans and advances to customers 4.23 - 465,169 177,860 180,511 225,123 1,048,663 Cash on deposit, at banks and in hand 0.87 12,016 65,529 174,568 - - 252,113 45,879 530,698 356,877 231,726 420,897 1,586,077 Financial Liabilities Deposits and savings accounts of customers 1.13 19,485 499,095 775,635 95,225 - 1,389,440 Interest bearing borrowings 1.11 - 4,000 - - - 4,000 SPRING loans 2.85 - 3,208 5,700 11,054 - 19,962 19,485 506,303 781,335 106,279 - 1,413,402

Group

31 December 2008

Financial Assets Statutory deposit with the Monetary Authority of Singapore - 44,076 - - - - 44,076 Singapore Government securities 3.30 - 17,519 9,113 50,191 162,033 238,856 Loans and advances to customers 4.41 - 642,881 345,675 194,771 209,360 1,392,687 Cash on deposit, at banks and in hand 0.62 4,039 48,210 - - - 52,249 48,115 708,610 354,788 244,962 371,393 1,727,868 Financial Liabilities Deposits and savings accounts of customers 1.75 12,650 466,158 858,071 122,203 - 1,459,082 Interest bearing borrowings 2.33 - 21,000 - - - 21,000 SPRING loans 2.86 - 2,534 4,478 8,966 - 15,978 Medium-Term Notes 4.36 - - 50,000 - - 50,000 12,650 489,692 912,549 131,169 - 1,546,060




Effective Non- weighted average interest 0 - 3 3 months 1 - 5 interest sensitive months to 1 year years > 5 years Total % $’000 $’000 $’000 $’000 $’000 $’000 Company

31 December 2009

Financial Assets Statutory deposit with the Monetary Authority of Singapore - 33,863 - - - - 33,863 Singapore Government securities 3.20 - - 4,449 51,215 195,774 251,438 Loans and advances to customers 4.23 - 465,169 177,860 180,511 225,123 1,048,663 Cash on deposit, at banks and in hand 0.87 11,957 65,529 174,568 - - 252,054 45,820 530,698 356,877 231,726 420,897 1,586,018 Financial Liabilities Deposits and savings accounts 1.13 19,485 499,582 775,867 95,225 - 1,390,159 Interest-bearing borrowings 1.11 - 4,000 - - - 4,000 SPRING loans 2.85 - 3,208 5,700 11,054 - 19,962 19,485 506,790 781,567 106,279 - 1,414,121

Company

31 December 2008

Financial Assets Statutory deposit with the Monetary Authority of Singapore - 44,076 - - - - 44,076 Singapore Government securities 3.30 - 17,519 9,113 50,191 162,033 238,856 Loans and advances to customers 4.41 - 642,881 345,675 194,771 209,360 1,392,687 Cash on deposit, at banks and in hand 0.61 3,958 48,210 - - - 52,168 48,034 708,610 354,788 244,962 371,393 1,727,787 Financial Liabilities Deposits and savings accounts of customers 1.75 12,650 466,630 858,301 122,203 - 1,459,784 Interest bearing borrowings 2.33 - 21,000 - - - 21,000 SPRING loans 2.86 - 2,534 4,478 8,966 - 15,978 Medium-Term Notes 4.36 - - 50,000 - - 50,000 12,650 490,164 912,779 131,169 - 1,546,762




Interest rate sensitivity analysis

As at 31 December 2009, a 100 basis point increase/(decrease) in the interest rate at the end of the reporting period would (decrease)/increase profit by $744,000 (2008 : increase/(decrease) profit by $126,000).

(2) Market risk on investments

Market risk exists due to changes in market prices that will affect the Group’s income or the value of its holding in the investments. The objective of market risk management is to manage and control the Group’s market risk exposures within acceptable parameters, while optimising the return on its investments.

The Group’s investment portfolio comprises mainly Singapore Government securities and securities listed on the Singapore Exchange Securities Trading Limited (SGX). The Group adopts a prudent investment policy to generate a stable yearly return with minimal downside in capital loss. In addition, as these investments are held for a long term basis, the risk of price fluctuation is mitigated.

Singapore Government Securities (“SGS”)

The Group purchases SGS as part of its liquid assets for purpose of maintaining the minimum liquid asset required under the Finance Companies Act.

SGS are stable financial instruments with a reasonable rate of return and each purchase is evaluated based on the expected period of requirement, the prevailing offer price and the rate of return on the SGS in the market. This strategy has not changed from prior periods.

Securities listed on the SGX

Acceptable securities include stocks and shares, bonds and such other financial derivative instruments of any companies which are listed on the SGX.

The Board of Directors is responsible for formulating investment policy, strategies, and guidelines and periodically reviews the investment portfolio. The Group adopts a prudent investment policy and ensures that its investments are all into reputable companies with substantial market capitalisation, acceptable price-earning ratios, good track records and consistent yearly dividends payouts. These investments are held generally for stable returns and capital appreciation.

(3) Equity price risk on investments

The Group is exposed to equity risks arising from equity investments classified as available-for-sale. Available-for-sales equity investments are held for strategic rather than trading purposes.The Group does

not actively trade available-for-sale investments. No sensitivity analysis is prepared as the Group does not expect material adjustment to the profit or loss arising from the effect of the price changes on investments.

(iv) Operational risk

Operational risk is defined as the risk of loss resulting from inadequate or failed internal processes, people, and systems, or from external events. Potential loss may be in the form of financial loss or other damages, for example, loss of reputation and public confidence that will impact the Group’s credibility and ability to transact, maintain liquidity and develop new businesses.




(iv) Operational risk (cont’d)

In providing oversight of the management of the Group’s operational risk, the management develops and maintains a framework of policies, processes and procedures by which operational risks inherent in the Group’s businesses are identified, assessed, monitored, controlled, mitigated and reported in a structured, systematic and consistent manner.

Also, clear roles and responsibilities of staff have been established to ensure proper segregation of functions and internal controls.

The development of overall Group’s standards for the management of operational risk includes the following areas:

- Development of whistle blowing programs to detect corrupt, illegal or other acts of misconduct;

- Requirements for appropriate segregation of duties including independent authorization of transactions;

- Requirements for reconciliation of balances and monitoring of transaction limits;

- Compliance with regulatory and other legal requirements;

- Documentation of controls and procedures;

- Requirements for periodic assessment of operational risks faced, and the establishment of controls and procedures to address the risks identified;

- Training and professional development of staff;

- Ethical and business standards; and

- Development of business continuity, crisis management and risk-based management programs to mitigate risks and to manage the impact of unforeseen events.

All units and operations of the Group are inspected by the Internal Auditors who prioritise their audit tasks by developing a risk-based audit plan. The Internal Audit plan in consultation with the management is approved by the Group’s Audit Committee. The periodic reviews undertaken by the Internal Auditor and the Compliance Department aim to assist the management in assessing and evaluating the internal controls of the Group. The findings of the Internal Audit and the Compliance teams are discussed with the Heads of the business units and submitted to the Group’s management for information and action. Furthermore, the Internal Auditor’s independent summary reports are tabled for the deliberation of the Group’s Audit Committee before any recommendation of follow up action is made to the Board of Directors.

(v) Fair value of financial assets and financial liabilities

In assessing the fair value of financial instruments, the Group uses a variety of methods and make assumptions that are based on market conditions existing at the end of each reporting period.

Although the directors have employed their best judgement in the estimation of fair values, there is inevitably a significant element of subjectivity involved in the calculations. Therefore, the fair value estimates presented below are not necessarily indicative of the amounts the Group could have realised in a transaction at 31 December 2009.




Methodologies

The methodologies and assumptions used depend on the terms and risk characteristics of the various instruments and include the following:

(1) Liquid assets

The carrying values of certain on-balance sheet financial instruments approximate fair values. These include statutory deposit with the Monetary Authority of Singapore, cash on deposit, at banks and in hand. These financial instruments are short-term in nature or are receivable on demand and the related amounts approximate fair value.

(2) Investments The fair values of quoted debt and equity securities are determined based on bid prices at the end of the reporting period without any deduction for transaction costs.

(3) Loans and advances

The fair value of loans and advances that reprice within six months from the end of the reporting period is assumed to equate to the carrying value. The fair value of all other loans and advances were calculated using discounted cash flow techniques based on the maturity of the loans. The discount rates are based on market related rates for similar types of loans at the end of the reporting period.

(4) Deposits and other borrowings

The fair value of non-interest bearing deposits, saving accounts and fixed deposits which are repriceable within six months is estimated to be the carrying value at the end of the reporting period. The fair value of other term deposits was calculated using discounted cash flow techniques, based on the deposit type and its related maturity. The discount rates are based on market related rates of similar types of deposits at the end of the reporting period.

(5) Commitments to extend credit and guarantees

These financial instruments are generally not sold nor traded. Fair value of these items is considered insignificant for the following reasons:

- commitments extending beyond six months that would commit the Company to a predetermined rate of interest are insignificant

- the fees attaching to these commitments are the same as those currently charged to enter into similar arrangements; and

- the quantum of fees collected under these agreements, upon which a fair value would be based, is insignificant.




SUMMARY

The following table provides an analysis of carrying and fair values for each item discussed above, where applicable, and the categories of financial instruments:

Carrying Fair Carrying Fair amount value amount value 2009 2009 2008 2008 $’000 $’000 $’000 $’000 Group

Financial Assets Loans and receivables: Statutory deposit with the Monetary Authority of Singapore 33,863 33,863 44,076 44,076 Loans and advances 1,048,663 1,065,056 1,392,687 1,416,805 Cash on deposit, at banks and in hand 252,113 252,113 52,249 52,249

Available-for-sale financial assets: Investments 254,411 254,411 240,564 240,564 1,589,050 1,605,443 1,729,576 1,753,694 Financial liabilities Amortised costs: Deposits and savings accounts of customers 1,389,440 1,394,183 1,459,082 1,465,476 Factoring current accounts - - 18 18 Interest bearing borrowings 4,000 4,000 21,000 21,000 SPRING loans 19,962 19,962 15,978 15,978 Medium-Term Notes - - 50,000 50,000 1,413,402 1,418,145 1,546,078 1,552,472

Company

Financial assets Loans and receivables: Statutory deposit with the Monetary Authority of Singapore 33,863 33,863 44,076 44,076 Loans and advances 1,048,663 1,065,056 1,392,687 1,416,805 Cash on deposit, at banks and in hand 252,054 252,054 52,168 52,168

Available-for-sale financial assets: Investments 254,163 254,163 240,356 240,356 1,588,743 1,605,136 1,729,287 1,753,405




Carrying Fair Carrying Fair amount value amount value 2009 2009 2008 2008 $’000 $’000 $’000 $’000 Company

Financial liabilities Amortised costs: Deposits and savings accounts of customers 1,390,159 1,394,902 1,459,784 1,466,179 Factoring current accounts - - 18 18 Interest bearing borrowings 4,000 4,000 21,000 21,000 SPRING loans 19,962 19,962 15,978 15,978 Medium-Term Notes - - 50,000 50,000 1,414,121 1,418,864 1,546,780 1,553,175

The Group classifies fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels: (a) quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1); (b) inputs other than quoted prices in the Level 1 that are observable for the asset and liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (Level 2); and (c) inputs for the asset and liability that are not based on observable market date (unobservable inputs) (Level 3).

Financial instruments measured at fair value: Group Company Total Level 1 Total Level 1 $’000 $’000 $’000 $’000 31 December 2009

Financial Assets Available-for-sale financial assets: Quoted equity securities 2,973 2,973 2,725 2,725 Singapore Government securities 251,438 251,438 251,438 251,438 254,411 254,411 254,163 254,163

(b) Capital risk management policies and objectives

The Group maintains a capital adequacy ratio (“CAR”) which complies with the requirements of the Finance Companies Act. CAR is the percentage of adjusted core capital to total risk-weighted assets.

(i) The Group’s adjusted core capital includes share capital, statutory reserves and retained earnings.

The fair value reserve relating to unrealised gains (loss) on equity securities and certain debt securities instruments classified as available-for-sale are excluded from the Group’s adjusted core capital.

(ii) Risk-weighted assets are determined according to specified requirements by MAS that seek to reflect the varying levels of risk attached to assets and off-balance sheet exposures.

The Group’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business as well as to generate an optimal return on its assets.

The Group has complied with all externally imposed capital requirements throughout the year and there have been no material changes in the management of capital during the year.




The Group’s capital position at 31 December was as follows: Group 2009 2008 $’000 $’000

Capital element

Core capital

Share capital 117,199 117,199 Disclosed reserves * 77,996 62,971 195,195 180,170

* Excludes fair value reserve

Risk weighted assets

Comprising:

On-balance sheet items 1,022,464 1,248,277 Off-balance sheet items 7,172 9,805 1,029,636 1,258,082

Capital adequacy ratio:

Core capital/risk weighted assets (%) 18.96 14.32

(iii) Capital allocation

The allocation of capital between specific operations and activities is, to a large extent, driven by optimisation of the return achieved on the capital allocated. The amount of capital allocated to each activity is based primarily upon the regulatory capital. The Group sets the internal guidelines for monitoring the mix of assets and liabilities. The ALCO reviews the assets portfolio and the compliance to the guidelines on a quarterly basis.

Although maximisation of the return on risk-adjusted capital is the principal basis used in determining how capital is allocated within the Group to particular operations or activities, it is not the sole basis used for decision making. Account is also taken for synergies with other operations and activities, the availability of management and other resources and the fit of the activity with the Group’s longer term strategic objectives. Group’s policies in respect of capital management and allocation are reviewed regularly by the Board of Directors.

5 RELATED COMPANY AND RELATED PARTY TRANSACTION

Related company in these financial statements refer to the Company’s subsidiary. Related parties are entities with common direct or indirect shareholders and/or directors. Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial and operating decisions.

Transactions between the Company and its subsidiary have been eliminated on consolidation and are not disclosed in this note.

Transactions entered into by the Group and the Company with other related parties incurred in the ordinary course of business from time to time and at market value, primarily comprise loans, provision of professional services and sale of investment products and property, management services, incidental expenses and/or other transactions relating to the business of the Group and the Company.

Other than disclosed elsewhere in the financial statements, the transactions with directors of the Company and other related parties are as follows:



5 RELATED COMPANY AND RELATED PARTY TRANSACTION (cont’d)

Group and Company 2009 2008 $’000 $’000

At 31 December

(a) Loans, advances and hire purchase receivable 7,288 8,952

(b) Deposits 14,599 3,658

(c) Profit or loss transactions - Interest income on loans and advances and hiring charges in respect of hire purchases receivables (278) (324) - Interest expenses on deposits 55 153 - Professional fee 4 13 - Rental income (266) (266)

6 OTHER ASSETS Group and Company 2009 2008 $’000 $’000

Accrued interest receivables 3,561 2,718 Prepaid commission 1,115 1,888 Prepaid interest on deposits 69 154 Prepayments, deposits and other assets 433 285 5,178 5,045

7 INVESTMENTS Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Investments available-for-sale

Quoted equity securities 2,973 1,708 2,725 1,500 Singapore Government securities 251,438 238,856 251,438 238,856 254,411 240,564 254,163 240,356

Other unquoted investments, at cost 29 29 29 29 Impairment loss (29) (29) (29) (29) - - - -

254,411 240,564 254,163 240,356



8 LOANS AND ADVANCES Group and Company 2009 2008 $’000 $’000

Housing, factoring receivables and other loans 830,241 1,107,055 Hire purchase receivables 276,132 345,675 Interest in suspense (1,888) (2,091) Unearned interests (27,479) (36,466) Allowances for impairment on loans and advances (28,343) (21,486) 1,048,663 1,392,687

Due within 12 months 369,028 491,951 Due after 12 months 679,635 900,736 1,048,663 1,392,687

Allowances for impairment on hire purchase receivables due within twelve months and due after twelve months amounted to $6,096,858 (2008 : $4,935,497) and $3,468,656 (2008 : $1,627,226), respectively.

Movements in allowances for impairment on loans and advances are as follows:

Group and Company 2009 2008 $’000 $’000 Specific allowance At 1 January 7,386 6,308 Allowances for impairment losses during the year 103 1,350 Receivables written off against allowances (619) (272) At 31 December 6,870 7,386

General allowance At 1 January 14,100 2,090 Allowances for impairment losses during the year 7,373 12,010 At 31 December 21,473 14,100

Total allowances for impairment on loans and advances At 1 January 21,486 8,398 At 31 December 28,343 21,486



8 LOANS AND ADVANCES (cont’d)

The hire purchase receivables are as follows: Group and Company Gross Interest Principal $’000 $’000 $’000 2009

Within 1 year 87,503 10,589 76,914 After 1 year but within 5 years 170,725 14,876 155,849 After 5 years 17,904 923 16,981 276,132 26,388 249,744

2008

Within 1 year 96,943 13,014 83,929 After 1 year but within 5 years 214,518 18,068 196,450 After 5 years 34,214 5,384 28,830 345,675 36,466 309,209

The Group and Company’s leasing arrangements comprise hire purchase contracts mainly for motor vehicles and equipments.

9 PROPERTY, PLANT AND EQUIPMENT

Leasehold Freehold Furniture land and land and and office Motor buildings buildings equipment vehicles Renovation Computers Total $’000 $’000 $’000 $’000 $’000 $’000 $’000 Group and Company

Cost: At 1 January 2008 10,331 8,684 179 466 2,124 262 22,046 Additions 192 202 25 - 429 1,239 2,087 Disposal/Write off - - (2) - (105) (31) (138) Transfer to investment properties (113) (119) - - - - (232) At 31 December 2008 10,410 8,767 202 466 2,448 1,470 23,763 Additions - - 31 392 5 556 984 Disposal/Write off (2) (2) - (333) (228) (41) (606) At 31 December 2009 10,408 8,765 233 525 2,225 1,985 24,141

Accumulated depreciation: At 1 January 2008 1,318 54 23 439 336 134 2,304 Depreciation for the year 194 63 38 27 421 215 958 Disposal/Write off - - (2) - (98) (29) (129) At 31 December 2008 1,512 117 59 466 659 320 3,133 Depreciation for the year 198 67 43 54 395 507 1,264 Disposal/Write off - - - (333) - (41) (374) At 31 December 2009 1,710 184 102 187 1,054 786 4,023

Carrying amount: At 31 December 2009 8,698 8,581 131 338 1,171 1,199 20,118

At 31 December 2008 8,898 8,650 143 - 1,789 1,150 20,630



9 PROPERTY, PLANT AND EQUIPMENT (cont’d)

Description of material properties (including investment properties) held are as follows:

Carrying Market Carrying Market amount value amount value 2009 2009 2008 2008 $’000 $’000 $’000 $’000

A 17-storey office building at 41,328 75,500 41,909 100,000 96 Robinson Road, Singapore, 068899, on freehold and leasehold land, with an estimated gross floor area of 7,844.38 square metres. Approximately 38.23% (2008 : 38.23%) of the lettable space is used as the head office of the Company and the remaining area is for rental. Tenure of lease is 99 years commencing 1 October 1996.

A shop at Block 202, Bedok North 1,586 3,150 1,637 3,000 Street 1, #01-479 to 485, Singapore 460202, with a floor area of approximately 269 square metres on leasehold land. 134.50 square metres are used as branch premises and the remaining area is for rental. Tenure of lease is 86 years commencing 1 July 1992.

A shop at Block 715, Ang Mo Kio Avenue 6, 699 1,350 720 1,300 #01-4006, Singapore, 560715, with a floor area of approximately 110 square metres on leasehold land used as branch premise. Tenure of lease is 86 years commencing 1 July 1993. 43,613 80,000 44,266 104,300

10 INVESTMENT PROPERTIES Group and Company 2009 2008 $’000 $’000

At cost: At 1 January 28,796 27,928 Transfer from property, plant and equipment - 232 Additions - 636 Disposal/ Write off (6) - At 31 December 28,790 28,796

Accumulated depreciation: At 1 January 2,078 1,712 Depreciation charge for the year 378 366 At 31 December 2,456 2,078

Carrying amount:

At 31 December 26,334 26,718



10 INVESTMENT PROPERTIES (cont’d)

The investment properties relate to the office spaces at the head office and part of the premise at the Bedok Branch which are leased to third parties for rental. Each of the leases contains an initial non-cancellable period of 2 to 3 years. Subsequent renewals are negotiated with the lessee.

Market valuation of the investment properties were provided by Jones Lang Lasalle, a firm of independent professional valuers that have appropriate recognised professional qualifications and recent experience in the location and category of the properties being valued. The fair values are based on open market values, being the estimated amount for which a property could be exchanged on the date of the valuation between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. The fair value of the investment properties is as disclosed in Note 9.

11 SUBSIDIARY Company 2009 2008 $’000 $’000

Equity investments, at cost 25 25

Details of the subsidiary are as follows:

Name of subsidiary Sing Investments & Finance Nominees (Pte.) Ltd. Principal activities Nominee services Country of incorporation/business Singapore Equity held by the Group 100% (2008 : 100%)

The subsidiary is audited by Deloitte & Touche LLP Singapore.

12 DEFERRED TAX LIABILITIES

Movements in deferred tax assets and liabilities during the year are as follows: Recognised Recognised Recognised Recognised in profit in other in profit in other At or loss comprehensive At or loss comprehensive At 1 January for the year income 31 December for the year income 31 December 2008 (Note 24) (Note 20) 2008 (Note 24) (Note 20) 2009 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Group

Deferred tax assets (liabilities) Loans and advances 298 100 - 398 (78) - 320 Other assets (208) 208 - - - - - Employee benefits 35 6 - 41 (6) - 35 Property, plant and equipment (9) (193) - (202) (9) - (211) Investments - - (3,622) (3,622) - 2,543 (1,079) Others (96) 95 - (1) 1 - - 20 216 (3,622) (3,386) (92) 2,543 (935) Company

Deferred tax assets (liabilities) Loans and advances 298 100 - 398 (78) - 320 Other assets (208) 208 - - - - - Employee benefits 35 6 - 41 (6) - 35 Property, plant and equipment (9) (193) - (202) (9) - (211) Investments - - (3,595) (3,595) - 2,548 (1,047) Others (96) 95 - (1) 1 - - 20 216 (3,595) (3,359) (92) 2,548 (903)



13 DEPOSITS AND SAVINGS ACCOUNTS OF CUSTOMERS

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Fixed deposits 1,355,926 1,436,021 1,355,926 1,436,021 Fixed deposits from subsidiary - - 719 702 Savings accounts and call deposits 14,029 10,411 14,029 10,411 Project accounts 19,485 12,650 19,485 12,650 1,389,440 1,459,082 1,390,159 1,459,784

14 OTHER LIABILITIES Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Accrued interest payable 12,958 25,031 12,958 25,031 Accrued operating expenses 3,509 3,245 3,504 3,239 Amount due to subsidiary - - 16 8 Factoring current accounts - 18 - 18 Deposits for safe deposit boxes and rental deposits 805 790 805 790 Unclaimed dividends 583 580 90 88 Others 876 694 876 695 18,731 30,358 18,249 29,869

15 INTEREST BEARING BORROWINGS

The interest bearing borrowings were advanced in December 2009 (2008 : October 2008) and are due for repayment in January 2010 (2008 : January 2009). The interest bearing borrowings are unsecured and carries fixed interest rate at 1.105% (2008 : 2.05% and 2.64%) per annum.

16 SPRING LOANS (UNSECURED) Group and Company 2009 2008 $’000 $’000

Due within 12 months 8,908 7,012 Due after 12 months 11,054 8,966 19,962 15,978

SPRING Singapore (“SPRING”) loans represent amounts advanced by the Standards, Productivity and Innovations Board under the Local Enterprise Finance Scheme (“LEFS”) and Extended Local Enterprise Finance Scheme (“ELEFS”) to finance LEFS and ELEFS borrowers. The interest rates and repayment periods vary in accordance with the type, purpose and security of the facilities granted under the above schemes.

17 PROVISION FOR EMPLOYEE BENEFITS Group and Company 2009 2008 $’000 $’000

Liability for short-term accumulating compensated absences 205 225



18 MEDIUM-TERM NOTES (UNSECURED) Group and Company 2009 2008 $’000 $’000

Due within 12 months - 50,000

A $300,000,000 Medium-Term Note Programme (“MTN Programme”) was established in 2006. Under the MTN Programme, the Company may from time to time issue notes (the “Notes”) denominated in Singapore dollars in series comprising one or more tranches. The Notes will be issued pursuant to exemptions invoked by the Company under Sections 274 and 275 of the Securities and Futures Act (Chapter 289).

On 17 April 2006, the Company issued Series 001 Notes, comprising 3-year fixed rate interest, totalling $50 million for general funding requirements. The Notes were issued at an interest rate of 4.36% per annum, and were redeemed in 2009.

The Notes and interest payable under the MTN Programme (the “Coupons”) constitute direct, unconditional, unsubordinated and unsecured obligations of the Company. The Notes and the Coupons ranked pari passu, without any preference or priority among themselves, and pari passu with all other present and future unsecured obligations (other than subordinated obligations and priorities created by law) of the Company.

The Notes were repaid on 17 April 2009.

19 SHARE CAPITAL Group and Company 2009 2008 2009 2008 No. of shares No. of shares $’000 $’000 (’000) (’000)

Issued and fully paid: At 1 January and 31 December 105,084 105,084 117,199 117,199

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. All shares rank equally with regard to the Company’s residual assets.

20 RESERVES Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Statutory reserve 60,951 52,126 60,951 52,126 Fair value reserve 5,272 16,500 5,115 16,377 Accumulated profits 17,045 10,845 16,715 10,518 83,268 79,471 82,781 79,021

The statutory reserve is maintained in compliance with the provision of Section 18 of the Finance Companies Act, Chapter 108.

The fair value reserve comprises the cumulative net change in the fair value of available-for-sale investments until such investments are derecognised.



21 SEGMENT REPORTING

Segment reporting is not required for the Group and the Company as majority of the income is from the same business segment, which is credit and lending. All activities are carried out in the Republic of Singapore.

22 DIRECTORS’ REMUNERATION

Directors’ remuneration is recognised in the following line items in the profit or loss:

Group 2009 2008 $’000 $’000

Salaries and other benefits 1,663 1,650 Contributions to defined contribution plan 28 26 Directors’ fees 213 210 Others 36 32 1,940 1,918

23 PROFIT BEFORE INCOME TAX

The following items have been included in arriving at profit for the year:

Group 2009 2008 $’000 $’000

Interest income and hiring charges

Loans and advances and others 54,483 59,137 Cash and bank deposits 1,316 642 Investments 7,605 6,657 63,404 66,436

Interest expense

Deposits and others 21,420 29,610 Interest-bearing borrowings 14 201 Medium-Term Notes 633 2,186 22,067 31,997

Dividends

Quoted securities 92 118

Other income Bad debts recovered 35 10 Profit on disposal of property, plant and equipment 156 - Rental income from safe boxes 182 174 373 184

Staff costs

Salaries and other benefits 9,774 9,255 Contributions to defined contribution plan 1,073 932 Increase in liability for short-term accumulating compensated absences - 32 10,847 10,219



23 PROFIT BEFORE INCOME TAX (cont’d)

Group 2009 2008 $’000 $’000 Other operating expenses

Non-audit fees - auditors of the Company 32 26 Property, plant and equipment and investment property written off - 9 Operating expenses on investment properties 546 683 Maintenance, utilities and property tax 490 527 Legal and professional fees 86 593 Commission expense 1,420 1,511 Project costs 14 (143) Others 1,874 2,250 4,462 5,456

24 INCOME TAX EXPENSE Group 2009 2008 $’000 $’000 Current tax expense

Current year 3,429 2,954

Deferred tax credit (debit)

Reversal of temporary differences (Note 12) 92 (216)

Total income tax expense 3,521 2,738

Reconciliation of effective tax rate

Profit before income tax 21,173 8,258

Income tax using Singapore tax rate of 17% (2008 : 18%) 3,599 1,486 Expenses not deductible for tax purposes 77 1,626 Income not subject to tax (6) (27) Tax effect of income subject to concessionary tax rate of 10% (2008 : 10%) (241) (131) Others 92 (216) 3,521 2,738

25 EARNINGS PER SHARE Group 2009 2008 $’000 $’000 Basic and diluted earnings per share are based on: Net profit attributable to ordinary shareholders 17,652 5,520

No. of shares 2009 2008 (’000) (’000)

Weighted average number of ordinary shares 105,084 105,084

There were no potential dilutive ordinary shares for the years ended 31 December 2009 and 2008.



26 DIVIDENDS

After the reporting period, the Directors proposed the following dividends. These have not been provided for at the end of the reporting period. 2009 2008 $’000 $’000 Annual dividend proposed of 8 cents per share, one-tier tax exempt (2008 : 2.5 cents per share, one-tier tax exempt) 8,407 2,627

27 COMMITMENTS Group and Company 2009 2008 $’000 $’000

Capital commitments

Commitments for capital expenditure contracted but not provided for in the financial statements 595 656

Operating lease commitments

The Group as lessee Group and Company 2009 2008 $’000 $’000 Payment recognised as an expense during the year: Minimum lease payments under operating leases 275 250

The Group and the Company have commitments for future minimum lease payments under non-cancellable operating leases as follows: Group and Company 2009 2008 $’000 $’000 Payable:

Within 1 year 252 236 After 1 year but within 5 years 305 128 557 364

Operating lease payments represent rentals payable by the Group and the Company for some of its branches’ premises. Leases are negotiated for an average term of 3 years (2008 : 3 years) and rentals are fixed for an average of 3 years (2008 : 3 years).



27 COMMITMENTS (cont’d)

The Group as lessor

The Group and the Company leases out its investment properties. Non-cancellable operating lease rentals are receivable as follows: Group and Company 2009 2008 $’000 $’000 Receivable:

Within 1 year 2,461 2,135 After 1 year but within 5 years 725 910 3,186 3,045 Other Commitment

Unutilised loan commitments 292,604 331,584

28 CONTINGENT LIABILITIES (UNSECURED)

Commitments entered into by the Group and the Company on behalf of customers for which customers have corresponding obligations to the Group and the Company and for the Group and the Company’s operational requirement are as follows: Group and Company 2009 2008 $’000 $’000

Guarantees issued and letters of credit applied 3,495 3,161

As at 31 December 2009, guarantees issued for the Group and the Company’s operational requirement amounted to $80,100 (2008 : $82,200).



Additional InformationYear ended 31 December 2009


The following table shows the makeup (in percentage terms) of the average remuneration of directors. They are grouped by bands of $250,000 for the year ended 31 December 2009. Salary & Directors’ Remuneration Bands Employer’s CPF Bonus Fees Others Total % % % % %

$500,000 to $749,999

Lee Sze Leong 76.31 12.52 6.51 4.66 100

$250,000 to $499,999

April Lee nee Tang Biew Chin (retired w.e.f. 24 April 2009) 38.52 - 3.36 58.12 100Lee Sze Siong 73.42 11.77 3.76 11.05 100

Below $250,000

Li Loi Gan (retired w.e.f. 1 May 2009) 19.1 - 21.02 59.88 100Tay Teng Guan Arthur - - 100 - 100Tan Tong Guan - - 100 - 100Dr Joseph Yeong Wee Yong - - 100 - 100Lim Sin Hoa - - 100 - 100


Statistics of Shareholdingsas at 18 March 2010

DISTRIBUTION OF SHAREHOLDINGS No. of Size of Holdings Shareholders % No. of Shares %

1 - 999 296 13.94 88,646 0.08 1,000 - 10,000 1,214 57.18 5,552,813 5.29 10,001 - 1,000,000 599 28.22 37,429,306 35.62 1,000,001 and above 14 0.66 62,013,078 59.01 Total 2,123 100.00 105,083,843 100.00

No. of Country Shareholders % No. of Shares % Singapore 2,083 98.12 103,507,973 98.50 Malaysia 26 1.22 320,920 0.31Others 14 0.66 1,254,950 1.19 Total 2,123 100.00 105,083,843 100.00 No. of Type of Ownership Shareholders % No. of Shares % Individuals 1,984 93.45 42,525,617 40.47Nominees 31 1.46 14,504,943 13.80Corporation 108 5.09 48,053,283 45.73 Total 2,123 100.00 105,083,843 100.00

TWENTY LARGEST SHAREHOLDERS No. Name No. of Shares % 1 F. H. Lee Holdings (Pte) Limited 26,433,300 25.15 2 Ebrite Holding Pte Ltd 8,042,280 7.65 3 Phillip Securities Pte Ltd 5,464,952 5.20 4 SUTL Corporation Pte Ltd 4,068,818 3.87 5 Amelia 2,707,541 2.586 Lee Heng Wah @ Lee Heng Guan 2,361,500 2.25 7 DBS Nominees Pte Ltd 2,269,701 2.16 8 United Overseas Bank Nominees Pte Ltd 2,211,486 2.10 9 Aw & Sons Capital Pte Ltd 1,762,500 1.68 10 Sing Holdings Limited 1,681,000 1.60 11 Tan Chee Jin 1,402,000 1.3312 Lee Guan Seng 1,260,500 1.2013 Cosmos Investment Pte Ltd 1,190,100 1.13 14 Morph Investments Ltd 1,157,400 1.10 15 Hong Leong Finance Nominees Pte Ltd 888,000 0.85 16 Lim Hwee Sin 766,500 0.7317 Koh Boon Hong 761,600 0.7218 Ng Chit Tong Peter 746,000 0.7119 Wan Kiat Leng PteLtd 733,000 0.70 20 Ang Chian Poh 698,500 0.66 Total 66,606,678 63.37

Statistics of Shareholdingsas at 18 March 2010


SUBSTANTIAL SHAREHOLDERS AS AT 18TH MARCH 2010

No. of Shares Shareholdings registered in the Shareholdings in which Name name of Substantial Shareholders Substantial Shareholders are or their Nominees deemed to have an interest

Lee Fee Huang (1) 401,100 28,314,300Lee Sze Leong (2) 216,721 28,114,300Lee Sze Siong (3) 300,395 28,114,300Lee Sze Hao (4) 296,142 28,114,300Lee Yit (5) 46,200 28,114,300F.H. Lee Holdings (Pte) Limited (6) 26,433,300 1,681,000Ebrite Holding Pte Ltd 8,042,280 -Aw Chye Wee (7) - 9,804,780

Notes:-

(1) Lee Fee Huang is deemed to be interested in 200,000 shares held by his wife, Wee Yah Heong, 26,433,300 shares held by F.H. Lee Holdings (Pte) Limited and 1,681,000 shares held by Sing Holdings Limited.

(2) Lee Sze Leong is deemed to be interested in 26,433,300 shares held by F.H. Lee Holdings (Pte) Limited and 1,681,000 shares held by Sing Holdings Limited.

(3) Lee Sze Siong is deemed to be interested in 26,433,300 shares held by F.H. Lee Holdings (Pte) Limited and 1,681,000 shares held by Sing Holdings Limited.

(4) Lee Sze Hao is deemed to be interested in 26,433,300 shares held by F.H. Lee Holdings (Pte) Limited and 1,681,000 shares held by Sing Holdings Limited.

(5) Lee Yit is deemed to be interested in 26,433,300 shares held by F.H. Lee Holdings (Pte) Limited and 1,681,000 shares held by Sing Holdings Limited.

(6) F.H. Lee Holdings (Pte) Limited is deemed to be interested in 1,681,000 shares held by Sing Holdings Limited.

(7) Aw Chye Wee is deemed to be interested in 1,762,500 shares held by Aw & Sons Capital Pte Ltd and 8,042,280 shares held by Ebrite Holding Pte Ltd.

Free Float of equity

As at 18 March 2010, approximately 57.42% of issued share capital of the Company were held in the hands of the public (on the basis of information available to the Company). Accordingly, the Company has complied with Rule 723 of the Listing Manual of the Singapore Exchange Securities Trading Limited.

Voting rights of ordinary shareholders

Every member of the Company present in person or by proxy or represented by attorney shall, on a show of hands, have one vote, and in the case of a poll, one vote for every share of which he is a holder.

Directors’ shareholdings as at 21 January 2010

As shown in the Report of the Directors, the shares held by the Directors as at 31 December 2009 remain unchanged as at 21 January 2010.


Notice of Annual General Meeting

AS ORDINARY BUSINESS

1. To receive and, if approved, to adopt the Directors’ Report and Accounts for the year ended 31st December 2009 together with the Auditors’ Report thereon.

2. To approve the payment of $240,000 as Directors’ Fees for the year ended 31st December 2009. ( 2008 : $230,000 ).

3. To declare a first and final dividend of 8 cents per ordinary share (tax exempt) for the financial year ended 31st December 2009.

4. To re-elect the following Directors retiring pursuant to Article 109 of the Articles of Association of the Company:-

(a) Mr Lee Sze Leong; and

(b) Mr Tay Teng Guan Arthur

5. To consider and, if thought fit, to pass the following resolution as Ordinary Resolution pursuant to Section 153(6) of the Companies Act, Cap 50:-

“That pursuant to Section 153(6) of the Companies Act, Cap 50, Mr. Lim Sin Hoa who is over 70 years of age, be and is hereby re-appointed as a Director of the Company to hold office until the conclusion of the next Annual General Meeting.”

6. To re-appoint Messrs Deloitte & Touche LLP as Auditors of the Company for the next financial year and to authorise the Directors to fix their remuneration.

7. To transact any other business of an Annual General Meeting. AS SPECIAL BUSINESS

8. To consider and, if thought fit, to pass with or without modifications, the following resolutions which will be proposed as Ordinary Resolutions:- (A) “That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited, authority be and is hereby given to the Directors of the Company to:

(a) (i) allot and issue shares in the Company (“shares”) whether by way of rights, bonus or otherwise; and/or

(ii) make or grant offers, agreements or options (collectively, “Instruments”) that might or would require shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) warrants, debentures or other instruments convertible into shares,

at any time to such persons and upon such terms and conditions and for such purposes as the Directors may in their absolute discretion consider fit; and

(b) for the avoidance of doubt, notwithstanding the authority conferred by this Resolution may have ceased to be in force, issue shares in pursuance of any Instrument made or granted by the Directors while this Resolution was in force,

TO ALL SHAREHOLDERS

NOTICE IS HEREBY GIVEN that the Annual General Meeting of Sing Investments & Finance Limited will be held at 2 Shenton Way, 2nd Floor Auditorium SGX Centre 1, Singapore 068804 on Thursday 29th April 2010 at 3.30 p.m. for the following purposes:-

(Resolution 1)

(Resolution 2)

(Resolution 3)

(Resolution 4)

(Resolution 5)

(Resolution 6)

(Resolution 7)

(Resolution 8)



provided that :

(1) the aggregate number of shares to be issued pursuant to this Resolution (including shares to be issued in pursuance of Instruments made or granted pursuant to this Resolution) does not exceed 50% (or 100%, in the event of a pro-rata renounceable rights issue) of the issued share capital of the Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of shares to be issued other than on a pro-rata basis to the existing shareholders of the Company (including shares to be issued in pursuance of Instruments made or granted pursuant to this authority) does not exceed 20% of the total issued share capital of the Company (as calculated in accordance with sub-paragraph (2) below);

(2) (subject to such manner of calculation as may be prescribed by the SGX-ST) for the purpose of determining the aggregate number of shares that may be issued under sub-paragraph (1) above, the percentage of issued share capital shall be based on the issued share capital of the Company at the time such authority is given, after adjusting for :

(i) new shares arising from the conversion or exercise of any convertible securities or share options or vesting of share awards which are outstanding subsisting at the time such authority is given; and

(ii) any subsequent consolidation or sub-division of shares;

(3) in exercising the authority conferred by this resolution, the Directors shall comply with the provisions of the Listing Manual for the time being in force (unless such compliance has been waived by the SGX-ST) and the Articles of Association for the time being of the Company; and

(4) (unless revoked or varied by the Company in general meeting) this authority shall continue in force until the conclusion of the next annual general meeting of the Company or the date by which the next annual general meeting of the Company is required by law to be held, whichever is the earlier.

(B) “That subject to and pursuant to the share issue mandate in the proposed resolution 8 above being obtained, authority be and is hereby given to the Directors to issue new shares other than on a pro-rata basis to shareholders of the Company at an issue price per new share which shall be determined by the Directors in their absolute discretion provided that such price shall not represent more than a 20% discount for new shares to the weighted average price per share determined in accordance with the requirements of the SGX-ST”

BY ORDER OF THE BOARD

Chan Kum KitTan Mui SangCompany Secretaries

Singapore, 12 April 2010

(Resolution 9)


Notes:

(1) A member of the Company entitled to attend and vote at the above Meeting is entitled to appoint not more than two proxies to attend and vote on his behalf. A proxy need not be a member of the Company. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 96 Robinson Road #01-01 SIF Building, Singapore 068899 not less than 48 hours before the time for holding the Meeting.

(2) Mr Lee Sze Leong, will upon re-election under item 4(a) above, continue to serve as Chairman of the Board and as a Member of the Nominating Committee and the Loan Committee. Mr Lee Sze Leong is the Managing Director/Chief Executive Officer of the Company.

(3) Mr Tay Teng Guan Arthur is considered to be an independent director by the Board of Directors, and if re-elected under item 4(b) above, will remain as a Member of the Audit Committee and the Remuneration Committee.

(4) Mr Lim Sin Hoa is considered to be an independent director by the Board of Directors, and if re-appointed under item 5 above, will remain as Chairman of the Remuneration Committee and a Member of the Nominating and Loan Committees.

(5) The ordinary resolution 8 proposed in item 8 above, if passed, will empower the Directors of the Company from the date of the above Meeting until the next Annual General Meeting to allot and issue shares and convertible securities in the Company up to a number not exceeding in total 50% (or 100%, in the event of a pro-rata renounceable rights issue) of the issued share capital of the Company for the time being for such purposes as they consider would be in the interest of the Company, provided that the aggregate number of shares to be issued other than on a pro-rata basis to existing shareholders pursuant to this Resolution shall not exceed 20% of the Company’s issued share capital at the time the resolution is passed. The percentage of issued share capital is based on the Company’s issued share capital after adjusting for (a) new shares arising from the conversion of convertible securities or share options or vesting of share awards which are outstanding or subsisting at the time that the resolution is passed, and (b) any subsequent consolidation or subdivision of shares.



This page is intentionally left blank.

SING INVESTMENTS & FINANCE LIMITED(Incorporated in the Republic of Singapore - Company Registration No: 196400348D)

PROXY FORM

I/We (Name)

of (Address)

being a member/members of Sing Investments & Finance Limited hereby appoint:

Name AddressNRIC/ Passport

NumberPercentage of shareholdingsrepresented

and / or (delete as appropriate):

as my/our proxy/proxies to vote for me/us on my/our behalf, at the Annual General Meeting of the Company, to be held on 29th April 2010 and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions to be proposed at the Meeting as indicated with an “X” hereunder. If no specific direction as to voting is given, the proxy/proxies will vote or abstain from voting at his/their discretion, as he/they will on any other matter arising at the Meeting.

No. Resolutions relating to: For Against

1 Adoption of Accounts and Reports

2 Approval of Directors’ Fees

3 Declaration of Final Dividend

4 (a) Re-election of Mr Lee Sze Leong as a Director

5 (b) Re-election of Mr Tay Teng Guan Arthur as a Director

6 Re-appointment of Mr Lim Sin Hoa as a Director

7 Re-Appointment of Messrs Deloitte & Touche LLP as Auditors and to authorize Directors to fix their remuneration

8 As special business - approval of general mandate for the Directors to issue new shares or convertible instruments

9 As special business - approval of mandate for the Directors to issue new shares at a discount

Dated this ____________day of ___________________2010.

_____________________________________Signature(s) of Member(s)/Common Seal

IMPORTANT: PLEASE READ NOTES OVERLEAF#

IMPORTANT

1. For investors who have used their CPF monies to buy Sing Investments & Finance Limited shares, this Annual Report is forwarded to them at the request of their CPF Approved Nominees and is sent solely FOR INFORMATION ONLY.

2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them.

Total Number of Shares Held

NOTES:

1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint not more than two proxies to attend and vote on his behalf.

2. Where a member appoints two proxies, he shall specify the percentage of his shares to be represented by each proxy and if no percentage is specified, the first named proxy shall be deemed to represent 100 per cent of the shareholding and the second named proxy shall be deemed to be an alternate to the first named.

3. A proxy need not be a member of the Company.

4. Please insert the total number of shares held by you. If you have shares entered against your name in the Depository Register (as defined in Section 130A of the Companies Act, Chapter 50), you should insert that number of shares. If you have shares registered in your name in the Register of Members of the Company, you should insert that number of shares. If you have shares entered against your name in the Depository Register and also in the Register of Members, you should insert the aggregate number of shares. If no number is inserted, the instrument appointing a proxy or proxies will be deemed to relate to all the shares held by you.

5. The instrument appointing a proxy or proxies must be deposited at the Company’s Registered Office at 96 Robinson Road #01-01 SIF Building, Singapore 068899 not less than 48 hours before the time set for the Meeting.

6. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its common seal or under the hand of its attorney or a duly authorised officer.

7. Where an instrument appointing a proxy or proxies is signed on behalf of the appointor by an attorney, the letter or power of attorney or a duly certified copy thereof must (failing previous registration with the Company) be lodged with the instrument of proxy, failing which the instrument may be treated as invalid.

8. The Company shall be entitled to reject any instrument appointing a proxy or proxies which is incomplete, improperly completed, illegible or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument. In addition, in the case of shares entered in the Depository Register, the Company may reject any instrument appointing a proxy or proxies if the member, being the appointor, is not shown to have shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to the Company.

The Company SecretarySING INVESTMENTS & FINANCE LIMITED

96 Robinson Road #01-01SIF Building

Singapore 068899

AffixPostageStamp

fold here

fold here

PROXY FORM

SING INVESTMENTS & FINANCE LIMITEDCo. Reg. No. 196400348D

96 Robinson Road #01-01 SIF BuildingSingapore 068899Tel : 6305 0300Fax: 6305 0328

www.sif.com.sg

Date post:	17-Apr-2020
Category:	Documents
Upload:	others
View:	2 times
Download:	0 times

ContentsAccountancy and Graduate’s Commerce Diploma. He is a director of SV Holdings Ltd, Times...

Documents