Singapura Finance S23 has reported profit after tax of $4.1 million for the 2HFY2022 ended Dec 31, 2022, 13.2% lower than the profit after tax of $4.7 million in the corresponding period the year before.
Profit after tax for the FY2022 fell by 13.2% y-o-y to $8.3 million.
During the 2HFY2022, the bottom line was affected by the higher total operating expenses, which more than offset the growth in net interest income and hiring charges.
The bottom line for the FY2022 was mainly due to the higher operating expenses and impairment allowances on loans.
2HFY2022 net interest income and hiring charges rose by 13.7% y-o-y to $14.2 million as interest income and hiring charges grew. Non-interest income fell by 44.2% y-o-y due to the lower Covid-19 grants from the government. Total interest expense grew by 113.1% y-o-y to $5.3 million.
At the same time, total operating expenses increased by 33.7% y-o-y to $9.0 million. Staff costs, depreciation of property, plant and equipment as well as other operating expenses contributed to the higher overall expenses.
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Net allowance for loan impairment losses of $0.5 million was set aside compared to $0.7 million during the same period last year.
FY2022 net interest income and hiring charges rose by 6.6% y-o-y to $26.2 million mainly due to the increase in interest income from loans and advances, Singapore Government Securities (SGS) and other interest earning assets on the back of a higher interest rate environment. Total interest expense increased by 56.3% y-o-y to $7.9 million. Non-interest income declined by 42.1% y-o-y due to the lower government Covid-19 grants.
Total operating expenses rose by 17.0% y-o-y to $15.4 million due mainly to higher staff costs and other operating expenses.
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There was a net charge for loan impairment losses amounting to $1.4 million for FY2022 compared to $1.2 million for the FY2021.
Earnings per share (EPS) stood at 5.15 cents on a diluted basis for the 2HFY2022. FY2022 EPS stood at 5.26 cents.
As at Dec 31, 2022, cash and cash equivalents stood at $97.3 million.
A first and final dividend of 2.0 cents per share as well as a special dividend of 1.25 cents per share have been declared for the 2HFY2022. This is slightly lower than the first and final dividend of 2.0 cents per share and special dividend of 2.0 cents per share in the 2HFY2021.
Against the backdrop of slowing economic growth in Singapore and around the world, the group says it will be "proactive" in managing its net interest margin in the rising interest rate environment and will continue to manage its risk exposures closely.
"The group continues its aim to stay relevant and competitive as we continue to forge ahead with our digital transformation to sustain the group’s long-term growth for the benefit of all our stakeholders," it adds.
Shares in Singapura Finance closed flat at 79 cents on Feb 17.
