PNG BANK POSTS $19 MILLION PROFIT

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PORT MORESBY, Papua New Guinea (PNG Post-Courier, April 3) - The success of Bank South Pacific in Papua New Guinea has helped Credit Corporation post a net profit of PGK56.9 million [US$19.9 million] for the year ended December 31, 2006.

[PIR editor’s note: According to its website, Credit Corporation started in Papua New Guinea in 1978 and operates the Bank South Pacific. Bank South Pacific is Papua New Guinea's largest retail bank with over 35 branches and in excess of 2 billion kina [US$702 million] in assets.]

The increase in the share price of Bank South Pacific raked in PGK35.65 million [US$12.5 million] to the corporation’s total profit.

Recent share trades on the Port Moresby Stock Exchange capitalize the bank at PGK2 billion [US$702 million]. Credit Corporation (PNG) Limited owns 10 percent of the issued shares of Bank South Pacific.

Credit Corporation chairman Sir Henry ToRobert said the 2006 profit of PGK56,929,609 was 15 per cent higher than the profit recorded in the corresponding period of 2005.

He said the company earning per share was PGK1.13 and the net tangible asset backing per ordinary share had increased to PGK5.79. Total assets now exceed PGK486 million, an increase of nearly PGK80 million for the year. "All segments of the group have continued to perform strongly. It should also be noted that the company’s investment in Bank South Pacific has continued the pleasing results from 2005 with Bank South Pacific announcing an after tax profit of PGK111.62 million [US$39.2 million] for the year," Sir Henry said.

After reviewing the 2006 results, the directors have recommended that a final dividend of 15 toea per share be paid; this represents an increase of 25 percent on the 2005 dividend. "This dividend, together with a share price increase of nearly 20 percent on the Port Moresby Stock Exchange, represents another exceptional result for shareholders for 2006," Sir Henry said.

Sir Henry also stated that Credit Corporation (Fiji) Limited has continued to perform well with a record profit before tax of FJ$6,066,642 [US$3.7 million] for the year.

However he said the economy in Fiji was under extreme pressure as a result of the military coup of December 5 2006 and economic growth is forecast to slow for the foreseeable future.

Credit Corporation (Finance) Limited had a good year with a before tax profit of PGK8,618,046 [US$3 million], whilst the property companies continue to perform well with Papua New Guineas premier commercial building Credit House remaining fully tenanted. An additional 18 townhouses at the exclusive Era Dorina estate will be ready for occupancy by June this year.

"Our new venture in Solomon Islands had a good year with the first full year of operation showing a net profit before tax of SB$926,923 [US$133,013], a pleasing result in a difficult business environment," Sir Henry said.

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