PNG’S CREDIT CORP. POSTS RECORD PROFIT

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PNG’S CREDIT CORP. POSTS RECORD PROFIT US$70 million profit is 229 percent increase

PORT MORESBY, Papua New Guinea (PNG Post-Courier, March 18, 2008) – Papua New Guinea’s stable economic condition has pushed up earnings for one of the country’s major companies.

Credit Corporation (PNG) Limited — which has just opened a branch in neighbouring Vanuatu — yesterday posted a record after tax profit of PGK187 million [US$69.7 million] for 2007 — a 229 per cent increase from 2006.

It also saw a 40 per cent increase in its total assets to K681 million but also attributed the record earning to Bank South Pacific's K191.07 million after tax profit last year. The corporation's chairman Barry Hanson yesterday paid tribute to the country’s emerging economic conditions for his company’s record performance, but similarly acknowledged BSP.

"The sustained strength of the PNG economy laid the foundation for another highly successful year with increased earnings, a very strong balance sheet and a growing business," he said adding, "our investment in Bank South Pacific has been a major contributor to the overall profit."

BSP — Credit Corporation owns nearly 10 per cent of the bank’s issued shares — last year recorded a 79 per cent increase in its after tax profit from its 2006 results.

"Its (BSP) total assets increased to K5.8 billion and the increase in its share price on the Port Moresby Stock Exchange contributed K141.66 million to the total profit of the group," Mr Hanson said.

He added continued strength in its operations in finance, property and investments also impacted on its financial performance and also on the corporation’s share value over the last 12 months. "The property companies continued to perform well with PNG’s premier commercial office building Credit House remaining fully tenanted. Era Dorina had a most successful year," he said, adding construction of an 18-apartment tower has begun and should be completed by September next year.

While he said its other operations in Fiji and Solomon Islands also performed well, he admitted the 2006 military coup in Fiji would impact its profit as the country slowly moved to revive its economy. "... we expect increased underlying profits to be obtained in all of our other operations and our results for the first two months of 2008 have exceeded expectations," he said.

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