Hong Leong Finance doubles down on core SME segment

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LOCAL companies will likely face a profit slowdown this year on the back of the US-China trade war, which shows no signs of easing, as well as property cooling measures that kicked in last July, said Ang Tang Chor, president of Hong Leong Finance. Read more at The Business Times.

The goal for Hong Leong Finance is to continue deepening relationships with its SME clients, as it's the rapport built with customers that will stand the test of time, says Mr Ang.LOCAL companies will likely face a profit slowdown this year on the back of the US-China trade war, which shows no signs of easing, as well as property cooling measures that kicked in last July, said Ang Tang Chor, president of Hong Leong Finance.

Nevertheless, the financial institution is planning to weather the storm by doubling down on its core SME segment and expanding its non-property related loan services, boosted by the relaxation of the Finance Companies Act effective in late 2017 that allowed higher limits for unsecured business loans. It is also focusing on its vehicle loans and other segments which are seeing"healthy growth", Mr Ang added.

"In the past, they would change equipment every five years, now they try to stretch it out more. We are seeing more of this happening in the market." Despite this, the impact on Hong Leong Finance's loan books is expected to be minimal as its property loan portfolio is considered diversified, including residential, commercial, industrial and hotels, among others. Also, loans are made to both companies and individuals, with HDB loans rising in particular, he pointed out.

One segment that Hong Leong Finance is banking on for growth is vehicle loans. In fact, the firm has grown to become one of the top lenders in the market for vehicle loans, to the tune of about S$1.5 billion in 2018, he estimated. Hong Leong Finance also recently opened its 12th SME Centre in April this year with the aim of being closer to its SME customers, said Mr Ang.

 

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