HONG Leong Finance : S41 0% posted a 113.7 per cent rise in net profit to S$85.8 million for its second half ended Dec 31, 2022, from S$40.1 million the year before.

 

In 2022, the finance company recorded strong loan growth and an uplift in its asset yields, which outpaced a higher cost of deposits amid the ongoing interest rate hikes, it said in a bourse filing on Friday (Feb 24).

 

Earnings per share stood at 38.28 Singapore cents for the half-year period, up from 17.93 cents the previous year.

 

The group&rsquo s net interest margin expanded by 70 basis points to 2.11 per cent in H2. This brought net interest income up by 64.3 per cent to S$145.8 million, as the company gained from rising benchmark rates amid interest rate repricing.

 

Its fee and commission income grew 26.7 per cent on year to S$8.3 million.

 

Meanwhile, net allowances for loans and other financial assets were lower at S$0.9 million for the half-year period, due to lower allowance for credit-impaired loans than in the same period last year.

 

The group is recommending a final dividend of 13.25 Singapore cents per share, up from the 8.25 cents per share in the year earlier. Once approved by shareholders at the annual general meeting on Apr 27, the dividend will be paid on May 26.

 

For the full year, net profit rose 54.3 per cent on year to S$130.9 million, as net interest income gained 36.1 per cent to S$242.2 million. The group&rsquo s full-year fee and commission income grew 46.3 per cent to S$16.4 million on more lending activities.

 

Meanwhile, net allowances for loans and other financial assets increased to S$2.8 million on the back of higher allowances for non credit-impaired loans on revised risk parameters and higher loan portfolio.

 

The group expects 2023 will be &ldquo a year of normalisation amid cyclical headwinds&rdquo .

 

Hong Leong Finance chairman Kwek Leng Beng said the group will continue to focus on sourcing strategic opportunities, accelerating digital adoption and innovation, and exercising financial prudence.

 

Guangxi Yuchai Machinery, an indirect subsidiary of Singapore-listed Hong Leong Asia, has been included by the US government in its so-called &ldquo Unverified List&rdquo .

 

Guangxi Yuchai is a subsidiary of New York-listed China Yuchai International. It specialises in building diesel engines. Hong Leong Asia is the manufacturing and building materials holding company of the Kwek family.

 

The Unverified List is maintained by the Bureau of Industry and Security in the US Department of Commerce.

 

While most of the dozens of companies in the list are from China, they come from other countries such as Armenia, Canada, Switzerland and Singapore as well.

 

According to Reuters, companies are added to the unverified list because the US could not complete on-site visits to determine whether they can be trusted to receive sensitive technology exports from the US.

 

US inspections of Chinese companies require the approval of China' s commerce ministry.

 

&ldquo The company understands that an entity&rsquo s listing on the Unverified List does not mean that US exporters cannot engage with the parties listed,&rdquo says China Yuchai on Oct 16.

 

&ldquo Rather, the US exporters will have to conduct additional due diligence to verify end use or end users of final products before exporting the goods,&rdquo adds China Yuchai.

 

China Yuchai &ldquo understands&rdquo that its Guagnxi Yuchai has been proactively addressing the matter and that as at Oct 16, Guangxi Yuchai&rsquo s business is operating normally with no major supply chain impact, says China Yuchai.

 

China Yuchai&rsquo s US quoted shares closed at US$7.05 on Oct 16, down 2.49% for the day and down 48.39% year to date.