Centurion Club: BANKING & INVESTMENT SERVICES + COLLECTIVE INVESTMENTS + FINTECH & INFRASTRUCTURE + INSURANCE
Sing Investments and Finance (Sing Inv&Finance) has won all categories in the Centurion Club’s Banking & Investment Services + Collective Investments + Fintech & Infrastructure + Insurance segments for companies below $1 billion, as it did in 2023. This is a nod to its consistent financial performance.
Sing Inv&Finance is a licensed finance company under the Finance Companies Act 1967. Its principal activities include accepting deposits from the public and providing loans and credit facilities to individuals and corporations, particularly small and medium enterprises (SMEs) in Singapore.
In 1HFY2024 ended June, Sing Inv&Finance reported $19.6 million in profit from operations before allowances and income tax, up 19% y-o-y. Total income increased by 10% y-o-y to $33.8 million, with net interest income (NII) and non-interest income growing from a year ago. Despite this, net profit after tax fell by 2% y-o-y to $16.1 million, which the finance company said was due to the absence of a write-back in provisions and credit loss allowances compared with a $3.3 million write-back in 1HFY2023.
Operationally, net interest margins (NIM) improved by 20 basis points to 1.92% due to increased asset yields outpacing the cost of deposits.
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Business momentum remained strong, with customer loans expanding by 9% to $2.57 billion. Non-interest income grew by 13% to $3.4 million, mainly from higher fees and commissions and rental income from investment properties. Despite its growth, non-interest income accounts for just 10% of total income.
The group recorded fair-value, mark-to-market losses in its bond portfolio of $3.4 million comprising Singapore Government Securities and MAS Bills held for regulatory liquidity purposes.
Non-performing loans in 1HFY2024 stood at 0.3%, down significantly from 0.8% in 1HFY2023. A small credit loss allowance of $47,000 was provided for in 1HFY2024 compared with a $4.2 million write-back of bad debts and credit loss allowances recorded in 2HFY2023. Asset quality was resilient as the non-performing loan ratio improved by 10 basis points.
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As of June 30, Sing Inv&Finance’s net asset value stood at $1.84, up 8 cents y-o-y, but down a cent h-o-h, compared to its closing price of $1.05 on Nov 1.
Sing Inv&Finance’s suite of products for SMEs includes commercial property loans, land & construction loans, machinery loans, government-backed SME loans, block discounting financing, floor stock financing, shipping loans, account receivables/invoice factoring and unsecured business loans.
The group offers competitive products and services. SME customers sometimes choose finance companies over banks as finance companies can tailor products and provide more personalised services to their customers.
In its 2023 annual report, the group says: “Sing Inv&Finance will continue to develop its business with integrity and high standards of business ethics, be responsive to its customer’s needs and provide flexible financing solutions to address their financing needs and be their go-to financial partner. Our Products & Services SingFinance offers a full range of products and services to its retail and corporate/SME customers.”
During its AGM on April 25, managing director Lee Sze Leong commented that the company, while not having a strict guideline on the exact percentage of its profit to be paid out as dividends, has consistently distributed 40% or more of its earnings to its shareholders, subject to statutory reserves and other regulatory requirements.
When asked whether Sing Inv&Finance would consider distributing higher dividends given the stagnating share price and high inflation rate, chairman Michael Lau Hwai Keon replied that the board and management have been managing the business with their best efforts and necessary precautions but noted that the company does not have any direct control over its share prices.
According to its website, Sing Inv&Finance celebrated its 60th birthday this year with a brand refresh and a new logo featuring a gemstone, symbolising trust and simplicity, comprised of four hexagons that combine to form a robust octagon of strength and unity.
Three of the hexagons point to Sing Inv&Finance upholding its three core values — sincerity, integrity and flexibility — each represented by one of the three blue hexagons of the new logo. The last hexagon, in gold, symbolises the bright and prosperous future Sing Inv&Finance aims to create for its customers. The four hexagons also form a star in their centre, reminiscent of the finance company’s original star symbol.
