Asset Finance Confirms Return to Profitability

Asset Finance Ltd, a Whakatane based consumer and small business finance company, today announced a pre tax profit for the year to 31 March 2010 of $659,408 compared to a pre tax loss of $367,299 for same period last year. 

The loss in 2009 was a result of higher than normal loan write offs and impairment provisions combined with a reduction in loan income as the company ran its loan book down to match the reduction in depositor funding as a consequence of the problems facing the finance company sector at that time. 

As economic conditions have improved during the 2010 financial year Asset Finance has seen gradual growth in both its depositor funding and its lending book leading to increased loan income while, at the same time, the company has achieved a significant reduction in loan write offs and impairment provisions. Profitability in the 2010 financial year has also benefited from a major restructuring which has seen a significant reduction in overhead expenses. 

In November 2009 Asset Finance announced that it was withdrawing from the Crown Deposit Guarantee Scheme and despite the fact that it is now not able to offer a Crown Guarantee the Company has continued to receive deposit funds at a level comfortably sufficient to sustain current and projected lending growth. 

The Directors of Aset Finance are confidant that the Company has the structure and management to successfully see its way forward in the prevailing economic conditions. The Directors note that Asset Finance has no lending exposure to the property development sector and has only one related party loan, details of which are fully disclosed in the company's Prospectus.