Net interest income rises 27% year on year to S$34.2 million

 

SING Investments & Finance (SingFinance) posted a 21 per cent increase in net profit to S$20.3 million for the half-year ended Dec 31, 2024, from S$16.8 million in the corresponding period a year ago. This comes as the lender&rsquo s revenue edged 3 per cent higher year on year to S$77.1 million, from S$74.7 million.

 

SingFinance&rsquo s board recommended a final dividend of S$0.065 per share for shareholders&rsquo approval at the company&rsquo s next annual general meeting, up from a final dividend of S$0.06 per share that was declared in the year-ago period.

 

Net interest income and hiring charges for the half-year rose 27 per cent year on year to S$34.2 million, due to loan growth and an expansion in net interest margin. Net interest margin was up 41 basis points at 2.06 per cent for the half-year, from 1.65 per cent in the previous corresponding period. Non-interest income for the period recorded a 25 per cent year-on-year rise to S$3.9 million, on a 68 per cent increase in fees and commissions to S$1.9 million. The lender&rsquo s non-performing loans ratio came in at 0.2 per cent, down from 0.4 per cent in the year-ago period.

 

In its earnings release on Thursday (Feb 20), SingFinance noted that central banks in several major economies have begun cutting policy rates as inflation nears their set targets. &ldquo However, uncertainties persist on the timing and extent of declines in inflation and interest rates, due mainly to potential policy changes from the newly elected government administrations and their effects on tariffs and international trade.&rdquo

 

SingFinance said that it continues to see growth opportunities in Singapore, even as significant challenges and uncertainties for both the local and global economies remain.

As at June 30, the group&rsquo s capital adequacy ratio stood at 15.9%, down from 17.0% as at Dec 31, 2021. Photo: Stock image

 

Sing Investments & Finance has reported earnings of $19.7 million for the 1HFY2022 ended June, 7.3% higher than earnings of $18.3 million in the corresponding period the year before.

 

During the six-month period, interest income and hiring charges increased by 6.9% y-o-y to $39.7 million.

 

Interest expense fell by 20.9% y-o-y to $6.2 million.

 

Net interest income increased by 14.4% y-o-y to $33.5 million due to interest in suspense write-back from a final settlement of credit exposures to a corporate customer.

 

Net interest margin (NIM) increased by 0.34 percentage points y-o-y to 2.49%.

 

See also: KORE reports 1HFY2022 DPU of 3.02 US cents, down 4.4%

 

Excluding the write-back, Sing Investments & Finance&rsquo s NIM would have stood at 2.1%, 0.05 percentage points lower y-o-y, as the loan yield declined while the group continued to adapt to market competition.

 

During the 1HFY2022, non-interest income fell by 33.2% y-o-y to $2.3 million.

 

Total income stood 9.4% higher y-o-y at $35.8 million.

 

For the period, earnings per share (EPS) stood at 24.98 cents on a basic and diluted basis.

 

As at June 30, the group&rsquo s capital adequacy ratio stood at 15.9%, down from 17.0% as at Dec 31, 2021.

 

Cash and cash equivalents stood at $185.9 million.

 

On June 25, Sing Investments & Finance (SIF) managing director and chief executive officer Lee Sze Leong acquired 16,500 shares of the company for a consideration of S$23,925.

 

At S$1.45 per share, this increased his total interest in the licensed finance company, from 30.41 per cent to 30.42 per cent.

 

Mr Lee has served as director of SIF since February 1989 and was appointed to his current role in January 1997.

 

He also serves as the non-executive chairman of Sing Holdings.

 

Back on April 22, SIF reported a net profit after tax of S$8.0 million for its Q1FY21 (ended March 31), an improvement of 94.3 per cent compared to the same period last year, primarily attributed to lower funding costs, a decrease in operating expenses as well as write back of loan allowances.