sing investments & finance limited annualreport 2004

annual report 2004SING INVESTMENTS & FINANCE LIMITED

Sing Investment AR fa final 3/23/05 11:24 PM

FINANCIAL CALENDAR 2004Financial year ended 31.12.04

Announcement of audited results 2004 28.02.05

Annual general meeting 16.4.05

Proposed payment of first and final dividend 9.5.05

CONTENTS02. Chairman’s Statement

03. Corporate Data

04. Board of Directors

06. Corporate Governance Statement

08. 5-year Financial Summary

09. Financial Contents


SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2004 01

EXPANDING VISIONSSing Investments & Finance Limitedis a finance company that doesn’t just help youexpand your business, but more importantly, your vision.

SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2004 . 01


CHAIRMAN’S STATEMENT

02 . SING INVESTMENTS & FINANCE LIMITED ANNUAL REPORT 2004

Lee Sze LeongChairman30 March 2005

The Singapore economy registered an impressive growthof 8.4% in 2004 on the back of a recovery from a SARS-afflicted 2003.

The non-bank loans assets of banks and finance companiesgrew by 4.46% and 3.3% respectively accounting for anaverage growth of 4.42% in the financial sector. Housingloans contributed 54.1% to the increase and the demandfor the loans was driven by a fall in the unemployment ratewhich was in tandem with the economy’s strongperformance and the decline of property prices to anattractive level.

Financial PerformanceThe Group had a good year, benefiting from the growth ofour economy. The Group’s loan assets registered a 40.4%growth from $490 million as at 31 December 2003 to$688 million as at 31 December 2004.This contributed toan increase of 19.61% in interest income and hiring chargesfor the year. Despite the increase in revenue, the Group’s

net profit before tax declined by 26.1% from $9.30 millionto $6.87 million.This was mainly attributed to an increaseof $4.53 million in additional general provision for loanlosses required to meet the increase in the loan base aswell as a write-off of $2.28 million of the building atRobinson Road which is currently under redevelopment toa 17-storey building.

The Board recommends a first and final dividend of 10%less tax of 20% for the year ended 31 Dec 2004.

SIF BuildingThe Board had decided to redevelop the Robinson Roadproperty to maximize its plot ratio. This will similarlyenhance its value. This new building will house our mainbranch and corporate office. The building is expected tocomplete in end of year 2006.

Prospects for 2005The growth in Singapore’s economy is expected tomoderate to 3-5% in 2005.The slower growth and the stiffcompetition will continue to present a challengingoperating environment for the financial sector.The Groupwill continue to focus on promoting its main creditproducts and be pro-active in seeking out new products forgrowth with particular emphasis on delivering aconsistently high level of service to effectively meet theneeds of the customers.

AcknowledgementsI would like to thank the Board of Directors for their invaluable guidance throughout the year. I would againlike to express my appreciation to the staff for theirrelentless commitment and dedication during the year.I also thank our customers and shareholders for theircontinued support.


CORPORATE DATA

Board of DirectorsLee Sze Leong ChairmanAw Kim ChenLim Sin HoaTeo Tong WahProfessor Yeong Wee YongTay Teng Guan ArthurApril Lee nee Tang Biew Chin (Mrs)Li Loi GanLee Sze Siong

Audit CommitteeLim Sin Hoa ChairmanProfessor Yeong Wee YongTay Teng Guan Arthur

Nominating CommitteeProfessor Yeong Wee Yong ChairmanTeo Tong WahLee Sze Leong

Remuneration CommitteeTeo Tong Wah ChairmanLim Sin HoaLee Sze Leong

Loan CommitteeLee Sze Leong ChairmanAw Kim ChenTeo Tong WahLi Loi GanApril Lee nee Tang Biew Chin (Mrs)

SecretariesLow-Tan Leng Fong (Mrs)Tan Shou Chieh

Registered & Head Office135 Cecil Street #01-01 LKN BuildingSingapore 069536Tel: 6221 9998 Fax: 6225 0837 Web: www.sif.com.sg

Branch OfficesAng Mo Kio BranchBlock 715 Ang Mo Kio Avenue 6 #01-4006 Singapore 560715Tel: 6456 0588 Fax: 6456 9715

Macpherson Branch27 Tai Thong CrescentSingapore 347857Tel: 6288 3555 Fax: 6282 1286

Bedok BranchBlock 202 Bedok North Street 1#01-479/485Singapore 460202Tel: 6445 9596 Fax: 6449 3254

RegistrarLim Associates (Pte) Ltd10 Collyer Quay #19-08Ocean BuildingSingapore 049315Tel: 6536 5355

AuditorsKPMGCertified Public Accountants16 Raffles Quay#22-00, Hong Leong BuildingSingapore 048581(Partner in charge - Tan Huay Lim,appointed in 2000)



BOARD OF DIRECTORS


Aw Kim Chen Age: 76Mr. Aw joined the Board in 1978. He is also a director of Sing Investments & Finance Nominees (Pte.) Ltd and a member of theLoan Committee and Investment Committee.

Mr. Aw is the Chairman of the Singapore Rubber Packers Association. He is also the President of Singapore Thong Chai Medical Institution. He is the Honorary Chairman cum Executive Committee Advisor of Singapore Ann Kway Association, DeputyRegistrar of Marriage, Patron of Braddell Heights Citizens’ Consultative Committee, member of the Singapore Chinese Chamberof Commerce & Industry and the Management Committee member of Chung Cheng High School, Nanyang Junior College andNanyang Primary School. He was awarded the BBM (L). Mr. Aw is a Singaporean.

Teo Tong Wah Age: 59Mr.Teo has been a member of the Board since 1997. He is also the Chairman of the Remuneration Committee and a memberof the Nominating Committee and Loan Committee.

Mr.Teo is a Council Member of the Singapore Chinese Chamber of Commerce and Industry. He is also the Executive Directorof Tong Eng Brothers Pte Ltd and the Chairman of Trend Development Pte Ltd. Mr.Teo is a Singaporean.

Lee Sze Leong Age: 46Mr. Lee became a member of the Board in1989 and was appointed as its Chairman in 1997. He is also the Chairman of theCompany’s subsidiary, Sing Investments & Finance Nominees (Pte.) Ltd. Mr. Lee joined the Company in 1983 and was promotedto Managing Director in 1997. He chairs the Loan Committee, Investment Committee,Assets & Liabilities Committee and CreditRisk Management Committee. He is also a member of the Remuneration Committee and Nominating Committee.

Mr. Lee holds a degree in Business Administration from the University of Hawaii, Manoa, USA. He was awarded the Public ServiceMedal in 1997. He is currently the Chairman of the Association of Hire Purchase & Finance Companies, Honorary Secretary/Treasurer of the Finance Houses Association of Singapore and Council Member of Singapore Chinese Chamber of Commerce& Industry. Mr. Lee is also a director of Sea View Hotel Ltd, F. H. Lee Holdings (Pte) Ltd, Sing Holdings Ltd, Lee & Sons InvestmentsPte Ltd and Sing Bullion & Futures Pte Ltd. Mr. Lee is a Singaporean.

Lim Sin Hoa Age: 72Mr. Lim has been a member of the Board since 1996. He is also Chairman of the Audit Committee and a member of theRemuneration Committee. Mr. Lim holds a Bachelor of Science degree in Accountancy and a Graduate’s Commerce Diploma.He is Chairman of Sea View Hotel Ltd, S V Investment Pte Ltd,Times Express Pte Ltd, S V Technology Pte Ltd, Kong Hoa Pte Ltd,Lim Kok Gin & Nephews Pte Ltd, Sin Chang An Investment Pte Ltd, Sin Chang An Holdings Pte Ltd and Hong Yin Enterprises Pte Ltd.

He is also a director of Sing Development (China) Pte Ltd, Hokien Kiu Leong Tong, Hotel Manpower Pte Ltd, Singapore Hotel &Tourism Education Centre Pte Ltd, Promeet Singapore Pte Ltd, Hotel Reservations (Singapore) Pte Ltd. He is currently a trusteeof Singapore Hotel Association and a member of the Asean Tourism Association, Asean Hotel & Restaurant Association andSHATEC International Advisory Committee. Mr Lim was conferred the Honorary Citizen of Changxing, China on 15 October2003. Mr. Lim is a Singaporean.



Yeong Wee Yong Age: 54Professor Yeong has been a member of the Board since 1997. He is also the Chairman of the Nominating Committee and a member of the Audit Committee. He is the President of SGP International Management Academy (SIMA) and holds a Ph.D inManagement Science from the University of Waterloo, Canada. He had taught in the NUS Business School for 21 years beforeforming SIMA in 2001.

Professor Yeong is also Director of the Tan Kah Kee Foundation, Board member of Tan Kah Kee International Society, CouncilMember of the National Healthcare Group (NHG) College, Council Member of the Singapore-Shandong Business Council and Committee Member of Singapore Service Standards Committee, Advisory Board Member of the School of BusinessAdministration, Jimei University, the People’s Republic of China. He is a Singaporean.

Arthur Tay Teng Guan Age: 48Mr. Arthur Tay joined our Board as an Alternate Director in 1994 and was appointed director in 1997. He is also a member of the Audit Committee.

Mr. Tay is the Group Executive Chairman/Managing Director of SUTL Group of Companies. He is also a Council Member of the National Kidney Foundation and a Board director of the NKF Children’s Medical Fund. He is also the Patron of West CoastCitizens’ Consultative Committee. Mr.Tay holds a Master’s degree in Real Estate and Finance from Golden Gate University, USAand also an extended Master’s course in Corporate Finance from University of California Berkerly, USA. He is a Singaporean.

April Lee nee Tang Biew Chin Age: 58Mrs. Lee joined the Board in 1997. She was appointed by the Company as Senior General Manager in 1992 and promoted toExecutive Director in 1997. Prior to joining the Company she was a Deputy Director in the Monetary Authority of Singapore.

Mrs. Lee is also director of Sing Investments & Finance Nominees (Pte.) Ltd and a member of the Loan Committee, InvestmentCommittee,Assets & Liabilities Committee and Credit Risk Management Committee. She holds a degree in Economics from theUniversity of Western Australia. She is a Singaporean.

Lee Sze Siong Age: 44Mr. Lee joined the Company in 1986 and was appointed to the Board in 1997. He oversees the Company’s lending activities andthe branches. He is a member of the Assets & Liabilities Committee and Credit Risk Management Committee.

Mr. Lee holds a Bachelor of Business Administration degree from the University of Hawaii, USA and a Masters in Accounting fromUniversity of Southern Queensland, Australia. He is also the director of Sing Holdings Ltd, Sing Development (Pte) Ltd, SingDevelopment (China) Pte Ltd, F.H. Lee Holdings (Pte) Ltd, Sing Realty (Singapore) Pte Ltd and Lee and Sons Investments Pte Ltd.Mr. Lee is currently the Treasurer of the Balmoral Neighbourhood Committee. He is a Singaporean.

Li Loi Gan Age: 62Mr. Li has been a member of the Board since 1964. He is also a director of the Company’s subsidiary, Sing Investments & FinanceNominees (Pte.) Ltd and a member of the Loan Committee, Investment Committee, Assets & Liabilities Committee and CreditRisk Management Committee.

Mr. Li is the General Manager who oversees the Company’s operations in deposit-taking, money market, IT and accounting.He is also director of Sing Holdings Ltd, Sing Development (Pte) Ltd and Sing Bullion & Futures Pte Ltd. He is a Singaporean.



CORPORATE GOVERNANCE STATEMENT

Board of DirectorsThe Board of Directors was responsible for the Corporate Governance of Sing Investments & Finance Limited and its subsidiary company. Various Committees had been commissioned to assist the Board in the performance of its role and the execution of its responsibilities in:

• ensuring that the Company maintained a sound system of internal controls to fulfill its business objectives of safeguarding the shareholders’ interest and the Company’s assets; and

• engaging regular, effective and fair communications with the shareholders.

The composition of the Board of Directors remained unchanged. In accordance with the Company’s Memorandum andArticles Professor Yeong Wee Yong,Teo Tong Wah and Lee Sze Leong retired and were re-elected. Mr Aw Kim Chen andMr Lim Sin Hoa who were 75 and 71 years old respectively also retired in observance of the Companies Act and werereappointed.

During the year, the Board of Directors met 5 times to review and approve the Company’s business plans and internalpolicies. Mr Lim Sin Hoa was absent in one meeting while Mr Arthur Tay and Mr Teo Tong Wah were not present in twomeetings each. In its decision making process, the Board of Directors had deliberated the respective recommendationsof the Audit Committee, Remuneration Committee, Nominating Committee, Loan Committee and the InvestmentCommittee. It was also aided by two operational committees, namely the Credit Risk Management Committee and theAssets and Liabilities Committee in the management of credit and business risks, fund and liquidity requirements of theCompany respectively.

Audit CommitteeThe members of the Committee who were independent remained the same. The Committee met twice during theCompany’s financial year ended 31 Dec 2004 to review the findings and recommendations of the Internal Auditors on the Company’s internal controls and compliance with the policies and guidelines laid down by the Board, and toreview and recommend the company’s half year and full year financial results to the Board for approval.

Nominating CommitteeThe Nominating Committee comprising three members, the majority of whom were independent, met once during theyear to assess the performance of the Company as well as each of the Directors on the Board.

Remuneration CommitteeThe Remuneration Committee comprising also three members and the majority of whom were independent non-executive directors met once during the year to determine the remuneration package for each of the four executivedirectors.



Loan CommitteeThe composition of the Loan Committee remained unchanged. The Committee met 24 times during the year to consider the credit proposals submitted by management for its deliberation and approval.

Investment CommitteeThe composition of this committee has also remained the same. As in previous years, all investment decisions were reported to the Board of Directors.

Internal Controls & Credit Risk ManagementInternal Controls and Credit Risk Management continued to be the focus of the Board of Directors and theManagement. The Company’s internal auditors and the newly set up Compliance Department have been diligent in ensuring that the management and staff comply with all policies and guidelines set by the Board. The Credit RiskManagement Committee met quarterly to review the Company’s credit operations and to determine the quality and risk profile of its customer base.

Interested Person TransactionsThe Company had in place proper procedures for the recording and reporting of all interested person transactions.

Dealing in Company’s SharesThe Company had adopted the ‘Best Practices Guide’ issued by the Stock Exchange Securities Trading Limited for thetrading of the Company’s shares by its employees and Directors of the Group.

Business and Ethical ConductThe Management had continuously practised prudence in the performance of the Company’s business. In dealing withits customers and business associates, the Management had ensured that it and its staff observed the high standards of integrity and professionalism laid down by the Company and the Finance Houses Association.

Senior ManagementThe team of Senior Management remained as 4, comprising of 4 executive directors Mr. Lee Sze Leong, Mrs. April Lee,Mr. Li Loi Gan and Mr. Lee Sze Siong.They continued to oversee the company’s daily operations and set policies andguidelines to ensure proper internal controls were in place and the risk management system had remained effective.


5-YEAR FINANCIAL SUMMARY


2004 2003 2002 2001 2000$’000 $’000 $’000 $’000 $’000

Operating Revenue 30,916 25,848 28,573 29,166 31,508

Profit and Revenue ReservesProfit before tax 6,869 9,299 8,455 7,072 10,420Profit after tax 4,858 7,250 6,346 5,182 7,052Revenue Reserve 53,194 52,339 48,992 44,988 42,072

Share CapitalAuthorised 100,000 100,000 100,000 100,000 100,000Issued 50,040 50,040 50,040 50,040 50,040

Capital EmployedTotal Assets 846,891 654,610 652,295 627,621 571,387Net Assets 113,874 113,019 109,672 105,668 102,752

Volume of BusinessLoans 688,151 489,957 435,780 415,032 410,342Deposits 670,191 518,065 518,596 498,833 448,969

Dividend and Earnings per ShareDividend (net) 4,003 4,003 3,903 2,342 2,266Gross dividend per share (cents) 10.00 10.00 10.00 6.00 6.00Earnings per share (cents) 9.71 14.49 12.68 10.36 14.09

Return After Tax on Total Assets (%) 0.57 1.11 0.97 0.83 1.23

Return After Tax on Net Assets (%) 4.27 6.41 5.79 4.90 6.86

Net Tangible Asset per Share ($) 2.28 2.26 2.19 2.11 2.05

loans & deposits $million

2000 2001 2002 2003 2004

800

700

600

500

400

300

200

100

0

capital employed $million

2000 2001 2002 2003 2004

800

700

600

500

400

300

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100

0

share capital $million

2000 2001 2002 2003 2004

100

90

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70

60

50

40

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10

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authorisedissued & fully paid

total assetsnet assets

loansdeposits

profit $million

2000 2001 2002 2003 2004

10

9

8

7

6

5

4

3

2

1

profit before taxprofit after tax


FINANCIAL CONTENTS


10. Directors’ Report

13. Statement by Directors

14. Report of the Auditors to the Members

15. Balance Sheets

16. Consolidated Profit and Loss Account

17. Consolidated Statement of Changes in Equity

18. Statement of Changes in Equity

19. Consolidated Statement of Cash Flows

20. Notes to the Financial Statements

38. Statistics of Shareholdings

40. Notice of Annual General Meeting

Sing Investment AR fa final 3/23/05 11:24 PM Page 12


DIRECTORS’ REPORTYear Ended 31 December 2004

We are pleased to submit this annual report to the members of the Group and of the Company together with the auditedfinancial statements for the financial year ended 31 December 2004.

Directors

The directors in office at the date of this report are as follows:

Lee Sze LeongAw Kim ChenLim Sin HoaTeo Tong WahProfessor Yeong Wee YongTay Teng Guan ArthurApril Lee nee Tang Biew ChinLi Loi GanLee Sze Siong

Pursuant to Article 109 of the Company’s Articles of Association, Messrs Teo Tong Wah and Tay Teng Guan Arthur retire byrotation and being eligible, offer themselves for re-election.

Pursuant to Section 153(6) of the Companies Act, Chapter 50, Messrs Aw Kim Chen and Lim Sin Hoa who are over seventy yearsof age, retire and are eligible for re-election to hold office until the next Annual General Meeting.

Directors’ Interests

According to the register kept by the Company for the purposes of Section 164 of the Companies Act, Chapter 50 (“the Act”),particulars of interests of directors who held office at the end of the financial year (including those held by their spouses andinfant children) in shares, debentures, warrants and share options in the Company are as follows:

Other holdings in whichHoldings in the name of the director is deemedthe director or nominee to have an interest

At beginning At end At beginning At end

Name of Directors of the year of the year of the year of the year

Ordinary Shares of $1 each

Lee Sze Leong 103,201 103,201 13,415,100 13,415,100Aw Kim Chen - - 5,705,400 5,705,400Lee Sze Siong 143,046 143,046 13,415,100 13,415,100Li Loi Gan 557,601 557,601 864,955 864,955Teo Tong Wah 51,000 51,000 50,000 50,000

By virtue of Section 7 of the Act, Messrs Lee Sze Leong and Lee Sze Siong, are deemed to have an interest in the wholly-ownedsubsidiary of Sing Investments & Finance Limited at the beginning and at the end of the financial year.

Except as disclosed in this report, no director who held office at the end of the financial year had interests in shares, debentures,warrants or share options of the Company, or of related corporations, either at the beginning of the financial year or at the endof the financial year.

There was no change in any of the above-mentioned interests in the Company between the end of the financial year and 21January 2005.



Neither at the end of nor at any time during the financial year was the Company a party to any arrangement whose objects are,or one of whose objects is, to enable the directors of the Company to acquire benefits by means of the acquisition of shares inor debentures of the Company or any other body corporate.

During the financial year, the Company has engaged in transactions in the normal course of business with immediate familymembers of certain directors and with companies in which the directors have significant financial interest. However, the directorshave not received, nor will they become entitled to receive, any benefits arising out of these transactions other than those whichthey may be entitled to as customers or as shareholders of these companies.

Except as disclosed in this report and in the accompanying notes to the financial statements, since the end of the last financialyear, no director has received or become entitled to receive a benefit by reason of a contract made by the Company or a relatedcorporation with the director, or with a firm of which he is a member or with a company in which he has a substantial financialinterest.

Share Options

During the financial year, there were:

(i) no options granted by the Company or its subsidiary to any person to take up unissued shares in the Company or itssubsidiary; and

(ii) no shares issued by virtue of any exercise of option to take up unissued shares of the Company or its subsidiary.

As at the end of the financial year, there were no unissued shares of the Company or its subsidiary under option.

Audit Committee

The members of the Audit Committee at the date of this report are:

Lim Sin Hoa (Chairman)Professor Yeong Wee YongTay Teng Guan Arthur

The Audit Committee performs the functions specified by Section 201B of the Companies Act, the Listing Manual and the BestPractices Guide of the Singapore Exchange, and the Code of Corporate Governance.

The Audit Committee has held 2 meetings since the last directors’ report. In performing its functions, the Audit Committee metwith the Company’s external and internal auditors to discuss the scope of their work, the results of their examination andevaluation of the Company’s internal accounting control system.

The Audit Committee also reviewed the following:

assistance provided by the Company’s officers to the internal and external auditors;

financial statements of the Group and the Company prior to their submission to the directors of the Company foradoption; and

interested person transactions (as defined in Chapter 9A of the Listing Manual of the Singapore Exchange).

The Audit Committee has full access to management and is given the resources required for it to discharge its functions. It hasfull authority and discretion to invite any director or executive officer to attend its meetings. The Audit Committee alsorecommends the appointment of the external auditors and reviews the level of audit and non-audit fees.



The Audit Committee is satisified with the independence and objectivity of the external auditors and has recommended to theBoard of Directors that the auditors, KPMG, be nominated for re-appointment as auditors at the forthcoming Annual GeneralMeeting of the Company.

Auditors

The auditors, KPMG, have indicated their willingness to accept re-appointment.

On behalf of the Board of Directors

Lee Sze LeongChairman

Lim Sin HoaDirector

Singapore28 February 2005


STATEMENT BY DIRECTORS

In our opinion:

(a) the financial statements set out on pages 15 to 36 are drawn up so as to give a true and fair view of the state of affairs ofthe Group and of the Company as at 31 December 2004 and of the results, changes in equity and cash flows of the Groupand of the changes in equity of the Company for the year ended on that date; and

(b) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as andwhen they fall due.

The Board of Directors has, on the date of this statement, authorised these financial statements for issue.

On behalf of the Board of Directors

Lee Sze LeongChairman

Lim Sin HoaDirector



REPORT OF THE AUDITORS TO THE MEMBERS

We have audited the consolidated financial statements of the Group and the balance sheet and statement of changes in equity ofthe Company for the year ended 31 December 2004 as set out on pages 15 to 36. These financial statements are the responsibilityof the Company’s directors. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with Singapore Standards on Auditing. Those Standards require that we plan and performthe audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An auditincludes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit alsoincludes assessing the accounting principles used and significant estimates made by the directors, as well as evaluating the overallfinancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion:

(a) the consolidated financial statements of the Group and the balance sheet and statement of changes in equity of theCompany are properly drawn up in accordance with the provisions of the Companies Act, Chapter 50 (the “Act”) andSingapore Financial Reporting Standards to give a true and fair view of the state of affairs of the Group and of theCompany as at 31 December 2004 and of the results, changes in equity and cash flows of the Group and of the changesin equity of the Company for the year ended on that date; and

(b) the accounting and other records (excluding registers) required by the Act to be kept by the Company and by thesubsidiary incorporated in Singapore of which we are the auditors have been properly kept in accordance with theprovisions of the Act.

KPMGCertified Public Accountants



BALANCE SHEETSas at 31 December 2004

The accompanying notes form an integral part of these financial statements.

Group CompanyNote 2004 2003 2004 2003

$’000 $’000 $’000 $’000

Non-Current AssetsProperty, plant and equipment 3 29,914 31,987 29,914 31,987Investment in subsidiary 4 - - 25 25Loans and advances due after twelve months 5 520,224 350,551 520,224 350,551Deferred tax assets 6 - 58 - 58

550,138 382,596 550,163 382,621

Current AssetsStatutory deposit with the

Monetary Authority of Singapore 20 20,345 14,039 20,345 14,039Loans and advances due within twelve months 5 167,927 139,406 167,927 139,406Investments 7 91,376 86,422 91,318 86,348Negotiable certificates of deposit 2,000 2,000 2,000 2,000Other assets 8 3,778 1,498 3,778 1,498Cash on deposit, at banks and in hand 20 11,327 28,649 11,279 28,464

296,753 272,014 296,647 271,755

846,891 654,610 846,810 654,376

Share Capital 9 50,040 50,040 50,040 50,040Reserves 10 63,834 62,979 63,564 62,751

Total shareholders’ funds 113,874 113,019 113,604 112,791

Current LiabilitiesDeposits and savings accounts of customers 670,191 518,065 670,836 518,506Other liabilities 11 12,702 14,121 12,249 13,685Interest-bearing borrowings 12 35,500 - 35,500 -SPRING loans due within twelve months (unsecured) 13 6,432 4,542 6,432 4,542Employee benefits 14 105 85 105 85Current tax payable 1,636 1,679 1,633 1,668

726,566 538,492 726,755 538,486

Non-Current LiabilitiesSPRING loans due after twelve months (unsecured) 13 6,085 3,099 6,085 3,099Deferred tax liabilities 6 366 - 366 -

6,451 3,099 6,451 3,099

846,891 654,610 846,810 654,376


GroupNote 2004 2003

$’000 $’000RevenueInterest income and hiring charges 15 30,900 25,833Interest expense 15 (8,741) (8,951)

Net interest and hiring charges 22,159 16,882Fees and commissions 463 631Dividends 15 68 109Rental income 463 607Other operating income 15 1,179 104

Income before operating expenses 24,332 18,333Staff costs 15 (5,842) (4,198)Depreciation of property, plant and equipment 3 (544) (467)Other operating expenses 15 (6,179) (3,343)

Profit from operations before allowances 11,767 10,325Allowances for loan losses and investments 17 (4,898) (1,026)

Profit from ordinary activities before taxation 6,869 9,299Income tax expense 18 (2,011) (2,049)

Net profit for the year 4,858 7,250

Earnings per share (cents) 19 9.71 14.49

CONSOLIDATED PROFIT AND LOSS ACCOUNTYear Ended 31 December 2004




CONSOLIDATED STATEMENT OF CHANGES IN EQUITYYear Ended 31 December 2004

Share Share Statutory Accumulatedcapital premium reserve profits Total

$’000 $’000 $’000 $’000 $’000Group

At 1 January 2003 50,040 10,640 29,125 19,867 109,672

Net profit for the year - - - 7,250 7,250

Transfer from accumulated profitsto statutory reserve - - 1,791 (1,791) -

Final dividend paid of 10 centsper share less tax at 22% - - - (3,903) (3,903)

At 31 December 2003 50,040 10,640 30,916 21,423 113,019

At 1 January 2004 50,040 10,640 30,916 21,423 113,019




At 31 December 2004 50,040 10,640 32,120 21,074 113,874

The statutory reserve is maintained in compliance with the provision of Section 18 of the Finance Companies Act, Chapter 108.


STATEMENT OF CHANGES IN EQUITYYear Ended 31 December 2004

Share Share Statutory Accumulatedcapital premium reserve profits Total

$’000 $’000 $’000 $’000 $’000Company

At 1 January 2003 50,040 10,640 29,125 19,726 109,531




At 31 December 2003 50,040 10,640 30,916 21,195 112,791

At 1 January 2004 50,040 10,640 30,916 21,195 112,791




At 31 December 2004 50,040 10,640 32,120 20,804 113,604

The statutory reserve is maintained in compliance with the provision of Section 18 of the Finance Companies Act, Chapter 108.



CONSOLIDATED STATEMENT OF CASH FLOWSYear Ended 31 December 2004

Note 2004 2003

$’000 $’000Operating activitiesProfit from ordinary activities before taxation 6,869 9,299Adjustments for:Interest income (30,684) (25,681)Interest received 30,699 25,462Interest expense 8,741 8,951Interest paid (8,070) (9,351)Depreciation 544 467Property, plant and equipment written off 2,282 -Profit on disposal of investments (290) (70)Bad debt written off - 2Allowance for loan losses 4,898 1,663Allowance reversed for diminution in value of investments - (637)Non-cash share distribution (2) -Non-cash dividend received - (43)

Operating profit before working capital changes 14,987 10,062

Changes in working capital:Loans and advances (203,092) (55,840)Other assets (2,294) 496Deposits and savings accounts of customers 152,126 (531)Other liabilities (2,089) 394Interest-bearing borrowings 35,500 -SPRING loans 4,876 134Provision for employee benefits 20 15

Cash generated from/(used in) operations 34 (45,270)Income taxes paid (1,631) (2,583)

Cash flows from operating activities (1,597) (47,853)

Investing activitiesPurchase of property, plant and equipment (753) (108)Proceeds from disposal of investments 912 1,095Shares cash distribution 2 1

Cash flows from investing activities 161 988

Financing activityDividends paid (4,003) (3,903)

Cash flows from financing activity (4,003) (3,903)

Net decrease in cash and cash equivalents (5,439) (50,768)Cash and cash equivalents at beginning of the year 127,479 178,247

Cash and cash equivalents at end of the year 20 122,040 127,479



NOTES TO THE FINANCIAL STATEMENTSYear Ended 31 December 2004

These notes form an integral part of the financial statements.

The financial statements were authorised for issue by the directors on 28 February 2005.

1 Domicile and Activities

Sing Investments & Finance Limited (the Company) is incorporated in the Republic of Singapore and has its registeredoffice at 135 Cecil Street, #01-01, LKN Building, Singapore 069536.

The principal activities of the Company are those of a licensed finance company. The principal activities of the subsidiaryare those of a nominee service company.

The consolidated financial statements relate to the Company and its subsidiary (referred to as the Group).

2 Summary of Significant Accounting Policies

2.1 Basis of preparation

The financial statements are prepared in accordance with Singapore Financial Reporting Standards (FRS) includingrelated Interpretations promulgated by the Council on Corporate Disclosure and Governance.

The historical cost basis is used. Amounts are expressed in Singapore dollars, unless stated otherwise.

2.2 Basis of consolidation

Subsidiary is a company controlled by the Company. Control exists when the Company has the power, directly orindirectly, to govern the financial and operating policies of a company so as to obtain benefits from its activities.

Investment in subsidiaries are stated in the Company’s balance sheet at cost less impairment losses.

The financial statements of the subsidiary are included in the consolidated financial statements from the date thatcontrol commences until the date that control ceases.

All significant intra-group transactions and balances are eliminated on consolidation.

2.3 Property, plant and equipment

Owned assets

Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.

Subsequent expenditure

Subsequent expenditure relating to property, plant and equipment that has already been recognised is added to thecarrying amount of the asset when it is probable that future economic benefits, in excess of the originally assessedstandard of performance of the existing asset, will flow to the Group. All other subsequent expenditure is recognisedas an expense in the period in which it is incurred.

Disposal

Gains or losses arising from the retirement or disposal of property, plant and equipment are determined as thedifference between the estimated net disposal proceeds and the carrying amount of the asset and are recognisedin the profit and loss account on the date of retirement or disposal.



Depreciation

No depreciation is provided on freehold land and building under redevelopment. Depreciation is provided on astraight-line basis so as to write off items of property, plant and equipment, and major components that areaccounted for separately over their estimated useful lives as follows:

Leasehold land remaining life of the leaseFreehold and leasehold buildings 50 to 86 yearsFurniture, office equipment and motor vehicles 5 yearsComputers 3 yearsRenovation 2 to 5 years

2.4 Investments

Quoted equity investments are stated at the lower of cost and market value, determined on a portfolio basis.

Unquoted investments held for investment purposes are stated at cost less impairment losses. Allowance forimpairment in value is made when, in the opinion of directors, the carrying amount of these securities exceed theirrecoverable amount.

Singapore Government securities are stated at the lower of cost, adjusted for any premium or discount, andmarket value on a portfolio basis. Premium or discount arising on acquisition are amortised or accreted over theperiod from the date of purchase to the date of maturity.

2.5 Cash and cash equivalents

Cash and cash equivalents comprise cash in hand, bank deposits and highly liquid investments which are readilyconvertible into known amounts of cash and which are subject to an insignificant risk of changes in value. For thepurpose of the statement of cash flows, cash and cash equivalents are presented net of bank overdrafts which arerepayable on demand.

2.6 Impairment

The carrying amounts of the Company’s assets are reviewed at each balance sheet date to determine whetherthere is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated.

An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds itsrecoverable amount. All impairment losses are recognised in the profit and loss account.

2.7 Employee benefits

Defined contribution plans

Contributions to defined contribution plans are recognised as an expense in the profit and loss account as incurred.


2.8 Allowances for loan losses and interest on non-performing loans and advances

All known bad debts are written off and specific allowance is made for accounts which are considered doubtful. Inaddition, an amount is set aside as a general allowance to cover losses which, although not separately identified, canbe present in any portfolio of loans and advances.

Interest relating to non-performing loans and advances is not recognised as income until it is received.

2.9 Deferred tax

Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax basesof assets and liabilities and their carrying amounts in the financial statements. Temporary differences are notrecognised for the initial recognition of assets or liabilities that affect neither accounting nor taxable profit. Theamount of deferred tax provided is based on the expected manner of realisation or settlement of the carryingamount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date.

A deferred tax asset is recognised to the extent that it is probable that future taxable profit will be available againstwhich the temporary differences can be utilised.

2.10 Income recognition

Interest income

Interest on mortgage and other loans is calculated on an annual, monthly or daily rest basis. Where charges areadded to the principal financed at the commencement of the period, the general principle adopted for creditingthe income to the profit and loss account is to spread the income over the period over which repayments are due.

Interest on deposits with financial institutions and investments are accrued on a monthly basis.

Hiring charges

For hire purchase transactions, the hiring charges are credited to the profit and loss account, using the “Rule of 78”method or monthly rest basis depending on the hire purchase agreement, over the period over which repaymentsare due.

Dividend

Dividend income is recognised as and when received.

2.11 Operating leases

Where the Company has the use of assets under operating leases, payments made under the leases are recognisedin the profit and loss account on a straight-line basis over the term of the lease. Lease incentives received arerecognised in the profit and loss account as an integral part of the total lease payments made. Contingent rentalsare charged to the profit and loss account in the accounting period in which the year incurred.

2.12 Prepaid commission on loans and advances

Commission paid on loans and advances are deferred and recognised as an expense over the tenure of the loan.

For settled loans, the remaining portion of the prepaid commission is expensed immediately to the profit and lossaccount on the date of settlement.




3 Property, Plant and Equipment

Leasehold Freehold Property under Furnitureland and land and redevelopment and office Motorbuildings buildings # equipment vehicles Renovation Computers Total

$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Group and Company

Cost

At 1 January 2004 26,316 8,279 - 15 428 - 166 35,204

Additions - - 303 3 133 139 175 753

Write-off # (1,615) (1,923) - - - - - (3,538)

Reclassification # (21,560) (6,163) 27,723 - - - - -

At 31 December 2004 3,141 193 28,026 18 561 139 341 32,419

Accumulated depreciation

At 1 January 2004 2,190 757 - 7 179 - 84 3,217

Depreciation for the year 291 30 - 4 95 20 104 544

Write-off # (573) (683) - - - - - (1,256)

Reclassification # (1,414) - 1,414 - - - - -

At 31 December 2004 494 104 1,414 11 274 20 188 2,505

Carrying amount

At 31 December 2004 2,647 89 26,612 7 287 119 153 29,914

At 31 December 2003 24,126 7,522 - 8 249 - 82 31,987



Description of material properties held are as follows:Carrying amount

2004 2003

$’000 $’000

A two-storey intermediate shophouse cum flat at 27/27A Tai Thong Crescent,Singapore, with a floor area of approximately 232.25 square metres onfreehold land used as branch and office premises 89 92

A five-storey office building and extension with basement at 96 Robinson Road,Singapore on freehold and leasehold land, with a floor area ofapproximately 2,730 square metres with 1,212 square metres usedas the head office of the Company and the remainder for rental

# The aforesaid building with a net book value of $2,282,000 has beenwritten off in 2004 as it is slated for demolition due to redevelopment.The remaining net book value represents the cost of the land whichhas been reclassified to property under redevelopment. The additionsto property under redevelopment represents the costs incurred forthe construction of the new building, which will be the new head officeof the Company. The capital commitment for the remaining costis set out in Note 22 (a) 26,612 28,872

A shop at Block 202, Bedok North Street 1, #01-479 to 485, Singapore,with a floor area of approximately 269 square metres on leasehold landwith 134.50 square metres used as branch premises and the remainderfor rental 1,842 1,868

A shop at Block 715, Ang Mo Kio Avenue 6, #01-4006, Singapore,with a floor area of approximately 110 square metreson leasehold land used as branch premises 805 816

29,348 31,648

4 Investment in SubsidiaryCompany

2004 2003

$’000 $’000

Unquoted equity shares at cost 25 25

Details of the subsidiary are as follows:

Name of subsidiary Sing Investments & Finance Nominees (Pte.) Ltd.Principal activities Nominee servicesCountry of incorporation/business SingaporeEquity held by the Group 100% (2003: 100%)

The subsidiary is audited by KPMG Singapore.



5 Loans and Advances

Group and Company2004 2003

$’000 $’000

Housing, factoring receivables and other loans 498,690 414,254Hire purchase receivables 254,382 117,072Unearned interest (36,212) (15,314)Allowance for loan losses (28,709) (26,055)

688,151 489,957

Due within 12 months 167,927 139,406Due after 12 months 520,224 350,551

688,151 489,957

As at 31 December 2004, loans to and guarantees issued on behalf of directors of the Company and of companiesinwhich directors of the Company have controlling interests amounted to $4,367,000 and $Nil respectively (2003:$5,177,000 and $212,000).

The hire purchase receivables are receivable as follows:Group and Company

Gross Interest Principal

$’000 $’000 $’0002004

Within 1 year 51,322 9,642 41,680After 1 year but within 5 years 141,252 20,727 120,525After 5 years 61,808 4,436 57,372

254,382 34,805 219,577

2003

Within 1 year 30,569 4,557 26,012After 1 year but within 5 years 69,632 8,061 61,571After 5 years 16,871 1,004 15,867

117,072 13,622 103,450



6 Deferred Tax

Movements in deferred tax assets and liabilities during the year are as follows:

(Charged)/credited to

At 1 profit and loss At 31January account December

2004 (note 18) 2004

$’000 $’000 $’000Group and Company

Deferred tax assets/(liabilities)

Interest in suspense 58 (2) 56Prepaid commission - (428) (428)Provision for employee benefits 19 2 21Property, plant and equipment (19) 4 (15)

58 (424) (366)

The following temporary differences have not been recognised:


$’000 $’000

Deductible temporary differences 12,183 12,183

Deferred tax assets have not been recognised in respect of the general allowance for loan losses (“the allowance”) as itis not probable that the allowance will be utilised against future taxable profits.

7 Investments

Group CompanyNote 2004 2003 2004 2003

$’000 $’000 $’000 $’000

Quoted equity investments, at cost 1,008 1,631 950 1,557

Singapore Government securities, at cost 20 90,368 84,791 90,368 84,791

Other unquoted investments, at cost 29 29 29 29Allowance for diminution in value (29) (29) (29) (29)

- - - -

91,376 86,422 91,318 86,348


Group Company2004 2003 2004 2003

$’000 $’000 $’000 $’000

Market Value of InvestmentsQuoted equity investments 1,872 2,324 1,657 2,155Singapore Government securities 97,344 86,092 97,344 86,092

99,216 88,416 99,001 88,247

8 Other AssetsGroup and Company

2004 2003

$’000 $’000

Accrued interest receivable 1,362 1,377Prepaid commission 2,143 -Prepayments, deposits and other assets 273 121

3,778 1,498

9 Share CapitalCompany

2004 2003No. of No. ofshares shares

(’000) $’000 (’000) $’000

Authorised:Ordinary shares of $1 each 100,000 100,000 100,000 100,000

Issued and fully paid:Ordinary shares of $1 each 50,040 50,040 50,040 50,040

10 ReservesGroup Company

2004 2003 2004 2003

$’000 $’000 $’000 $’000

Share premium 10,640 10,640 10,640 10,640Statutory reserve 32,120 30,916 32,120 30,916Accumulated profits 21,074 21,423 20,804 21,195

63,834 62,979 63,564 62,751

The application of the share premium account is governed by Sections 69 of the Companies Act, Chapter 50.

The statutory reserve is maintained in compliance with the provision of Section 18 of the Finance Companies Act,Chapter 108.




11 Other LiabilitiesGroup Company

2004 2003 2004 2003

$’000 $’000 $’000 $’000

Accrued interest payable 8,182 7,510 8,183 7,510Accrued operating expenses 1,643 1,248 1,639 1,243Amount due to customers 273 106 273 106Amount due to subsidiary - - 5 2Factoring current accounts 1,717 4,473 1,718 4,473Deposits for safe deposit boxes and rental deposits 19 59 19 59Unclaimed dividends 504 497 69 65Others 364 228 343 227

12,702 14,121 12,249 13,685

12 Interest-Bearing BorrowingsGroup and Company

2004 2003

$’000 $’000

Bank loans (unsecured) 35,500 -

The Company obtained short term unsecured bank loans which are repayable between 14 - 60 days for general fundingrequirements. The interest is charged at annual rates ranging from 1.82% to 1.95% (2003: Nil).

13 SPRING Singapore Loans (Unsecured)Group and Company

2004 2003

$’000 $’000

Due within 12 months 6,432 4,542Due after 12 months 6,085 3,099

12,517 7,641

(“SPRING”) Singapore loans represent amounts advanced by the Standards, Productivity and Innovations Board underthe Local Enterprise Finance Scheme (“LEFS”) and Extended Local Enterprise Finance Scheme (“ELEFS”) to finance LEFSand ELEFS borrowers. The interest rates and repayment periods vary in accordance with the type, purpose and securityof the facilities granted under the above schemes.

14 Employee BenefitsGroup and Company

2004 2003

$’000 $’000

Liability for short-term accumulating compensated absences 105 85


15 Operating Profit Before Allowances

The following items have been included in arriving at operating profit before allowances:

Group2004 2003

$’000 $’000Interest income and hiring chargesLoans and advances and others 27,802 22,683Investments 2,882 2,998Accretion of discount on Singapore Government securities 216 152

30,900 25,833

Interest expenseDeposits and others 8,604 8,951Interest-bearing borrowings 137 -

8,741 8,951

Dividend incomeQuoted securities 68 109

Other operating incomeNet gain on redemption/sales of Singapore Government securities/investments 305 89Bad debts recovered 823 15Others 51 -

1,179 104

Staff costsSalaries and other benefits 5,315 3,775Contributions to defined contribution plans 507 408Increase in liability for short-term accumulating compensated absences 20 15

5,842 4,198

Other operating expensesBad debts written off (trade) - 2Non-audit fees:- auditors of the company 38 67Building cost written off 2,282 -Others 3,859 3,274

6,179 3,343

The number of employees of the Group at 31 December 2004 is 111 (2003: 89).




16 Directors’ Remuneration

Directors’ remuneration is recognised in the following line items in the profit and loss account:

Group2004 2003

$’000 $’000

Staff costs 1,661 1,251Other operating expenses- Directors’ fees:

- Current year 200 200- Underprovision in prior year - 80

- Others 117 110

1,978 1,641

17 Allowances for Loan Losses and Investments

Group2004 2003

$’000 $’000

Net allowance made/(reversed) for:Loan losses 4,898 1,663Diminution in value of quoted equity investments - (637)

4,898 1,026

In line with practice in the finance company sector, the level of general allowance for new loans first disbursed on or after1 October 2004 has been reduced from 3.5% to 1.5% of the net loan outstanding.

18 Income TaxesGroup

Note 2004 2003

$’000 $’000Current tax expenseCurrent year 1,592 1,939Over provision in prior years (5) -

1,587 1,939

Deferred tax expenseMovements in temporary differences 419 110Reduction in tax rate 5 -

6 424 110

Income tax expense 2,011 2,049


2004 2003

$’000 $’000Reconciliation of effective tax rate

Group

Profit before tax 6,869 9,299

Income tax using Singapore tax rate of 20% (2003: 22%) 1,374 2,046Expenses not deductible for tax purposes 947 112Income not subject to tax (15) (18)Tax effect of income subject to concessionary tax rate (297) (262)Effect of reduction in tax rate 5 -Utilisation of previously unrecognised tax losses - (9)Overprovision in prior years (5) -Others 2 180

2,011 2,049

19 Earnings Per ShareGroup

2004 2003

$’000 $’000Basic earnings per share is based on:Net profit for the year 4,858 7,250

No. of shares No. of shares

’000 ’000

Number of ordinary shares outstanding during the year 50,040 50,040

20 Cash and Cash EquivalentsGroup

2004 2003

$’000 $’000

Cash on deposit, at banks and in hand 11,327 28,649Statutory deposit with the Monetary Authority of Singapore 20,345 14,039Singapore Government securities 90,368 84,791

122,040 127,479




21 Dividends

After the balance sheet date, the Directors proposed the following dividends. These dividends have not been providedfor.


$’000 $’000Final dividend proposed of 10 cents (2003: 10 cents)

per share less tax at 20% (2003: 22%) 4,003 3,903

22 CommitmentsGroup and Company

2004 2003

$’000 $’000(a) Capital Commitments

Capital expenditure approved and contracted butnot provided for in the financial statements 15,838 404

(b) Operating Lease Commitments

The Company leases two office premises as its temporary Head Office under operating leases during the periodof redevelopment of Head Office building. At 31 December 2004, the Company has commitments for futureminimum lease payments under these non-cancellable operating leases as follows:


$’000 $’000Payable:- Within 1 year 333 -- After 1 year but within 5 years 249 -

582 -

23 Contingent Liabilities (Unsecured)

Commitments entered into by the Company on behalf of customers for which customers have corresponding obligationsto the Company are as follows:


$’000 $’000

Guarantees issued 3,041 4,127Letters of credit issued 184 584

3,225 4,711



24 Change in Accounting Policy

Effective from 1 July 2004, the Company changed its accounting policy with respect to accounting for commission paid onloans and advances. Commission paid on loans and advances is now deferred and recognised as an expense over thetenure of the loan. Previously, the Company expensed the commission paid immediately to the profit and loss account.This change is not accounted for retrospectively due to the impracticability of doing so.

The Company decided to adopt the deferral method as it matches the costs of the commission to the interest incomerecognised. Had the Company not deferred the commission, it would have reduced the profit from ordinary activitiesbefore taxation and the net profit for the year by $2,143,000 and $1,715,000 respectively.

25 Financial Instruments

Financial risk management objectives and policies

Credit, interest rate and liquidity risks are inherent in the normal course of the Group’s business. Various workingcommittees reporting to the Board of Directors have been set up to assess and monitor these risks.

The Company has in place processes to review and monitor the implementation of the Company’s policies and proceduralguidelines used for financial risk management. In addition, internal audits are conducted on an on-going basis to confirmthat these policies are functioning effectively.

Credit risk

Credit risk is the potential risk of financial loss from the failure of a customer to settle their financial and contractualobligations to the Company, as and when they fall due.

The Company has established a set of prudent credit policies. Its stringent requirements for credit evaluation andsecurity appraisal ensure that its loans are granted to customers of acceptable credit-standing and are supported byquality assets.

The Company has also internal controls in place to ensure the proper segregation of duties and authority and has in placea monitoring system to identify early symptoms of problematic loan accounts.

Liquidity risk

Liquidity risk is the risk that the Company is unable to service its cash obligations in the future. The Company’s liquidityrisk is mitigated by its maintenance of a minimum cash balance of 3% and a minimum liquid assets balance of 13% of theCompany’s liabilities base as required by the Monetary Authority of Singapore. Furthermore, the Company’s ability toaccess the interbank market provides an alternative source for its short-term funding requirements.

Interest rate risk

The Company’s core operations are deposit taking and extension of credit facilities. The Company’s exposure to interestrate risk results from potential changes in value of these assets and liabilities as a result of movements in interest rates inthe financial market in which it operates.

As interest rates change over time, the Company may be exposed to a loss in earnings due to effects of fixed and floatinginterest rates of these assets and liabilities. As such, the interest rate spread between these two activities is monitoredclosely on an on-going basis to maximise its yields and minimise its risk profile. A system is also in place to track marketinterest rate movements and to adjust on a timely basis the Company’s borrowing and lending rates.



Effective interest rates and repricing analysis

In respect of interest-earning financial assets and interest-bearing financial liabilities, the following table indicates their effectiveinterest rates at balance sheet date and the periods in which they reprice:

Fixed interest rate maturingEffective Non-Interest interest Floating 0 to 3 3 to 12 Over

sensitive interest months months 1 year Total

% $’000 $’000 $’000 $’000 $’000 $’000

2004Financial AssetsStatutory deposit with the

Monetary Authority of Singapore - 20,345 - - - - 20,345Singapore Government securities 3.38 - - 1,513 - 88,855 90,368Loans and advances to

customers (gross) 4.41 - 234,437 35,519 214,632 269,842 754,430Negotiable certificates of deposit 4.45 - - - 2,000 - 2,000Cash on deposit, at banks

and in hand 1.23 1,094 - 10,193 40 - 11,327

21,439 234,437 47,225 216,672 358,697 878,470

Financial LiabilitiesDeposits and savings

accounts of customers 0.98 - - 180,148 309,750 180,293 670,191SPRING loans 2.76 - - 2,692 3,740 6,085 12,517Interest-bearing borrowings 1.87 - - 35,500 - - 35,500

- - 218,340 313,490 186,378 718,208

2003Financial AssetsStatutory deposit with the

Monetary Authority of Singapore - 14,039 - - - - 14,039Singapore Government securities 3.60 - - 9,498 8,774 66,519 84,791Loans and advances

to customers (gross) 5.14 - 231,687 9,754 74,252 217,494 533,187Negotiable certificates of deposit 4.45 - - - - 2,000 2,000Cash on deposit, at banks

and in hand 0.77 1,322 - 27,307 20 - 28,649

15,361 231,687 46,559 83,046 286,013 662,666

Financial LiabilitiesDeposits and savings accounts

of customers 1.21 - - 171,627 242,742 103,696 518,065SPRING loans 2.74 - - 1,439 3,103 3,099 7,641

- - 173,066 245,845 106,795 525,706



26 Fair Values of Financial Instruments

In assessing the fair value of financial instruments, the Group uses a variety of methods and make assumptions that arebased on market conditions existing at each balance sheet date.

Although the directors have employed their best judgement in the estimation of fair values, there is inevitably a significantelement of subjectivity involved in the calculations. Therefore, the fair value estimates presented below are not necessarilyindicative of the amounts the Company could have realised in a sales transaction at 31 December 2004.

Methodologies

The methodologies and assumptions used depend on the terms and risk characteristics of the various instruments andinclude the following:

Liquid assets

The carrying values of certain on-balance sheet financial instruments approximate fair values. These include statutorydeposit with the Monetary Authority of Singapore, cash on deposit, at banks and in hand. These financial instruments areshort-term in nature or are receivable or payable on demand and the related amounts approximate fair value.

Investment securities

The fair values of investment securities, are based on quoted market prices at 31 December 2004.

Loans and advances

The fair value of loans and advances that reprice within six months of balance sheet date is assumed to equate to thecarrying value. The fair value of all other loans and advances were calculated using discounted cash flow models based onthe maturity of the loans. The discount rates applied in this exercise were based on the current interest rates of similartypes of loans.

Deposits and other borrowings

The fair value of non-interest bearing deposits, saving accounts and fixed deposits which are repriceable within six monthsis estimated to be the carrying value at 31 December 2004. The fair value of other term deposits was calculated usingdiscounted cash flow models, based on the deposit type and its related maturity. The discount rates applied in thisexercise were based on the current interest rates of similar types of deposits.

Commitments to extend credit, stand-by letters of credit and guarantees

These financial instruments are generally not sold nor traded and estimated fair values are not readily ascertainable. Fairvalue of these items was not calculated for the following reasons. Firstly, very few of the commitments extending beyondsix months would commit the Company to a predetermined rate of interest. Secondly, the fees attaching to thesecommitments are the same as those currently charged to enter into similar arrangements. Finally, the quantum of feescollected under these arrangements, upon which a fair value would be based, is not material.



Summary

The following table provides comparison of carrying and fair values for each item discussed above, where applicable:

Carrying Fair Carrying Fairamount value amount value

2004 2004 2003 2003

$’000 $’000 $’000 $’000Group

Financial AssetsStatutory deposit with the Monetary Authority of Singapore 20,345 20,345 14,039 14,039Loans and advances 688,151 693,227 489,957 492,437Investments 91,376 99,216 86,422 88,416Negotiable certificates of deposit 2,000 2,000 2,000 2,000Cash on deposit, at banks and in hand 11,327 11,327 28,649 28,649

813,199 826,115 621,067 625,541

Financial LiabilitiesDeposits and saving accounts of customers 670,191 675,682 518,065 521,291Factoring current accounts 1,717 1,717 4,473 4,473SPRING loans 12,517 12,517 7,641 7,641Interest-bearing borrowings 35,500 35,500 - -

719,925 725,416 530,179 533,405

27 Segment Reporting

Segment reporting is not required for the Group and the Company as majority of the income is from the same businesssegment, which is credit and lending. All activities are carried out in the Republic of Singapore.


ADDITIONAL INFORMATIONYear Ended 31 December 2004

The following table shows the makeup (in percentage terms) of the average remuneration of directors. They are grouped bybands of $250,000 for the year ended 31 December 2004.

Directors’ Remuneration Salary & Directors’Employer CPF Bonus Fees Others Total

% % % % %

$500,000 to $749,999Lee Sze Leong 62.47 28.32 6.71 2.50 100

$250,000 to $499,999April Lee nee Tang Biew Chin 61.89 24.75 3.36 10.00 100Li Loi Gan 71.71 18.42 5.61 4.26 100Lee Sze Siong 61.22 23.36 3.94 11.48 100

Below $250,000Aw Kim Chen - - 100 - 100Lim Sin Hoa - - 100 - 100Teo Tong Wah - - 100 - 100Professor Yeong Wee Yong - - 100 - 100Tay Teng Guan Arthur - - 100 - 100


STATISTICS OF SHAREHOLDINGSas at 4 March 2005

Authorised Share Capital : $100,000,000Issued and Fully Paid-up Share Capital : $50,040,400Class of Shares : Ordinary shares of $1.00 each fully paid

Distribution of Shareholdings

No. ofShareholders % No. of Shares %

Size of Holdings1 - 999 151 11.77 40,645 0.081,000 - 10,000 872 67.96 3,159,514 6.3110,001 - 1,000,000 249 19.41 19,639,808 39.251,000,001 and above 11 0.86 27,200,433 54.36

Total 1,283 100.00 50,040,400 100.00

Shareholdings by CountrySingapore 1,252 97.58 44,673,280 89.27Malaysia 25 1.95 722,820 1.45Others 6 0.47 4,644,300 9.28

Total 1,283 100.00 50,040,400 100.00

Shareholdings by Type of OwnershipIndividuals 1,181 92.05 19,198,829 38.37Nominees 32 2.49 12,497,043 24.97Corporation 70 5.46 18,344,528 36.66

Total 1,283 100.00 50,040,400 100.00

Twenty Largest Shareholders

No. Name No. of Shares %

1 F H Lee Holdings Pte Ltd 5,333,000 10.662 Malayan Banking Berhad 4,241,300 8.483 Estate of Oey Suwito @ Hong Peng, Deceased 2,770,000 5.544 Raffles Nominees Pte Ltd 2,530,000 5.065 Phillip Securities Pte Ltd 2,070,200 4.146 Ebrite Holding Pte Ltd 1,988,800 3.977 SUTL Corporation Pte Ltd 1,937,533 3.878 KB Nominees Pte Ltd 1,908,000 3.819 United Overseas Bank Nominees Pte Ltd 1,614,850 3.2310 DBS Nominees Pte Ltd 1,519,750 3.0411 Amelia 1,287,000 2.5712 Ng Choon Gim 849,000 1.7013 Aw Kim Cheng Realty Pte Ltd 819,500 1.6414 Sing Holdings Limited 800,100 1.6015 Mayban Nominees (S) Pte Ltd 750,000 1.5016 Lee Lean Cheng 664,000 1.3317 Lee Guan Seng 621,500 1.2418 Wan Kiat Leng Pte Ltd 559,990 1.1219 Tan Chee Jin 550,000 1.1020 OCBC Nominees Singapore Pte Ltd 453,100 0.91

Total 33,267,623 66.51


STATISTICS OF SHAREHOLDINGSas at 4 March 2005

Substantial ShareholdersNo. of Shares

Shareholdings registered Shareholdings in whichin the name of Substantial Shareholders

Substantial Shareholders are deemed to haveName or their Nominees an interest

Lee Sze Siong (1) 143,046 13,415,100Lee Sze Hao (2) 141,020 13,415,100Lee Sze Leong (3) 103,201 13,415,100Lee Fee Huang (4) 191,000 13,479,100Lee Yit (5) 2,000 13,363,100F.H. Lee Holdings (Pte) Limited (6) 12,563,000 800,100Aw Kim Chen (7) - 5,705,400Chew Ngui (8) - 4,834,300Aw Chye Wee (9) - 4,616,300Ebrite Holding (Private) Limited 3,796,800 -Estate of Oey Suwito @ Hong Peng, deceased 2,955,000 -Tay Choon Hye, deceased (10) 136,582 2,842,633

Notes:-

(1) Lee Sze Siong is deemed to be interested in 12,563,000 shares held by F. H. Lee Holdings (Pte) Limited and its nominees, 800,100 shares held by Sing HoldingsLimited and 52,000 shares held by Sinhoe Rubber (Pte) Ltd.

(2) Lee Sze Hao is deemed to be interested in 12,563,000 shares held by F. H. Lee Holdings (Pte) Limited and its nominees, 800,100 shares held by Sing HoldingsLimited and 52,000 shares held by Sinhoe Rubber (Pte) Ltd.

(3) Lee Sze Leong is deemed to be interested in 12,563,000 shares held by F. H. Lee Holdings (Pte) Limited and its nominees, 800,100 shares held by SingHoldings Limited and 52,000 shares held by Sinhoe Rubber (Pte) Ltd.

(4) Lee Fee Huang is deemed to be interested in 64,000 shares held by his wife, Wee Yah Heong, 12,563,000 shares held by F. H. Lee Holdings (Pte) Limited andits nominees, 800,100 shares held by Sing Holdings Limited and 52,000 shares held by Sinhoe Rubber (Pte) Ltd.

(5) Lee Yit is deemed to be interested in 12,563,000 shares held by F. H. Lee Holdings (Pte) Limited and its nominees and 800,100 shares held by SingHoldings Limited.

(6) F.H. Lee Holdings (Pte) Limited is deemed to be interested in 800,100 shares held by Sing Holdings Limited.

(7) Aw Kim Chen is deemed to be interested in 819,500 shares held by Aw Kim Cheng Realty (Pte) Ltd, 3,796,800 shares held by Ebrite Holding (Private)Limited and its nominee, 52,000 shares held by Sinhoe Rubber (Pte) Ltd, 21,000 shares held by Tai Mah Sawmill Company Pte Ltd, 800,100 shares held by SingHoldings Limited, 19,000 shares held by Kimvi Private Limited and 197,000 shares held by Mercantile Enterprises (Pte) Ltd.

(8) Chew Ngui is deemed to be interested in 819,500 shares held by Aw Kim Cheng Realty (Pte) Ltd, 3,796,800 shares held by Ebrite Holding (Private) Limitedand its nominee, 21,000 shares held by Tai Mah Sawmill Company Pte Ltd and 197,000 shares held by Mercantile Enterprises (Pte) Ltd.

(9) Aw Chye Wee is deemed to be interested in 819,500 shares held by Aw Kim Cheng Realty (Pte) Ltd and 3,796,800 shares held by Ebrite Holding (Private)Limited and its nominee.

(10) The deemed interest of Tay Choon Hye, deceased comprises of 105,000 shares held by his wife, Tan Hwee Kheng, 1,937,533 shares held by SUTL CorporationPte Ltd and 800,100 shares held by Sing Holdings Limited.

Free Float of Equity Securities

As at 4 March 2005, approximately 50.50% of issued share capital of the Company were held in the hands of the public (on thebasis of information available to the Company).

Accordingly, the Company has complied with Rule 723 of the Listing Manual of the Singapore Exchange SecuritiesTrading Limited.

Voting Rights of Ordinary ShareholdersEvery member of the Company present in person or by proxy or represented by attorney shall, on a show of hands, have onevote, and in the case of a poll, one vote for every share of which he is a holder.

Directors’ Shareholdings as at 21 January 2005As shown in the Report of the Directors, the shares held by the Directors as at 31 December 2004, remain unchanged as at21 January 2005.


NOTICE OF ANNUAL GENERAL MEETING

TO ALL SHAREHOLDERS

NOTICE IS HEREBY GIVEN that the Annual General Meeting of Sing Investments & Finance Limited will be held at 46 EastCoast Road #08-01 EastGate, Singapore 428766 on Saturday, 16th April 2005 at 12.00 noon for the following purposes:-

AS ORDINARY BUSINESS

1. To receive and, if approved, to adopt the Directors’ Report and Accounts for the year ended 31st December 2004together with the Auditors’ Report thereon.

2. To approve the payment of $200,000 as Directors’ Fees for the year ended 31st December 2004. ( 2003 : $200,000 )

3. To declare a first and final dividend.

4. To re-elect the following Directors retiring by rotation:-(a) Mr. Teo Tong Wah; and(b) Mr. Arthur Tay Teng Guan.

5. To consider and, if thought fit, to pass the following resolutions as Ordinary Resolutions pursuant to Section 153(6) of theCompanies Act, Chapter 50:-

(a) “That pursuant to Section 153(6) of the Companies Act, Chapter 50, Mr. Aw Kim Chen who is over 70 years ofage, be and is hereby re-appointed as a Director of the Company to hold office until the conclusion of the nextAnnual General Meeting.”

(b) “That pursuant to Section 153(6) of the Companies Act, Chapter 50, Mr. Lim Sin Hoa who is over 70 years ofage, be and is hereby re-appointed as a Director of the Company to hold office until the conclusion of the nextAnnual General Meeting.”

6. To re-appoint Messrs KPMG as Auditors and to authorise the Directors to fix their remuneration.

AS SPECIAL BUSINESS

7. To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:-“That pursuant to Section 161 of the Companies Act, Chapter 50 and Rule 806 of the Listing Manual of the SingaporeExchange Securities Trading Limited, approval be and is hereby given to the Directors to issue shares in the capital of theCompany whether by way of rights, bonus or otherwise (“shares”) and/or make or grant offers, agreements or optionsthat might or would require shares to be issued (“Instruments”) including but not limited to the creation and issue of(as well as adjustments to) warrants, debentures or other instruments convertible into shares, at any time, to suchpersons, upon such terms and conditions and for such purposes, as the Directors may in their absolute discretion deemfit, provided that the aggregate number of shares to be issued pursuant to this resolution shall not exceed 50% of theCompany’s issued share capital at the time this resolution is passed, of which the aggregate number of shares to be issuedother than on a pro rata basis to existing members shall not exceed 20% of the Company’s issued share capital at the timethis resolution is passed and that such authority shall continue in force until the conclusion of the Company’s next AnnualGeneral Meeting or the date by which the Annual General Meeting is required by law to be held or until revoked or variedat a general meeting of the Company, whichever is earlier.”

8. To transact any other business of an Annual General Meeting.

BY ORDER OF THE BOARD

Mrs Low nee Tan Leng FongTan Shou ChiehSecretaries

Singapore, 30th March 2005


NOTICE OF ANNUAL GENERAL MEETING

Notes:

(1) A member of the Company entitled to attend and vote at the above Meeting is entitled to appoint not more than twoproxies to attend and vote on his behalf. A proxy need not be a member of the Company. The instrument appointing aproxy must be deposited at the Registered Office of the Company at 135 Cecil Street #01-01 LKN Building, Singapore069536 not less than 48 hours before the time for holding the Meeting.

(2) Mr. Arthur Tay Teng Guan is considered to be a non-independent director by the Board of Directors, and if re-electedunder item 4(b) above, will remain as a Member of the Audit Committee.

(3) Mr. Lim Sin Hoa is considered to be an independent director by the Board of Directors, and if re-appointed under item5(b) above, will remain as Chairman of the Audit Committee.

(4) The ordinary resolution proposed in item 7 above, if passed, will empower the Directors of the Company from the dateof the above Meeting until the next Annual General Meeting to issue new shares or instruments convertible into sharesin the Company up to an aggregate number not exceeding 50% of the issued share capital at the time the resolution ispassed, where the issues are on a pro rata basis to all members. In the case where the issues are not on a pro rata basisto all members, then the aggregate number of such shares which may be issued as a result, shall not exceed 20% of theCompany’s issued share capital at the time the resolution is passed. This authority will, unless revoked or varied at ageneral meeting, expire at the next Annual General Meeting of the Company.


THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.


SING INVESTMENTS & FINANCE LIMITED(Incorporated in the Republic of Singapore - Company Registration No: 196400348D)

PROXY FORM

I/We (Name)

of (Address)being a member/members of Sing Investments & Finance Limited hereby appoint:

as my/our proxy/proxies to vote for me/us on my/our behalf, at the Annual General Meeting of the Company, to be held on 16thApril 2005 and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions to beproposed at the Meeting as indicated with an “X” hereunder. If no specific direction as to voting is given, the proxy/proxies willvote or abstain from voting at his/their discretion, as he/they will on any other matter arising at the Meeting.

No. Resolutions relating to: For Against

1. Adoption of Accounts and Reports

2. Approval of Directors’ Fees

3. Declaration of Final Dividend

4. (a) Re-election of Mr. Teo Tong Wah as a Director

(b) Re-election of Mr. Arthur Tay Teng Guan as a Director

5. (a) Re-appointment of Mr. Aw Kim Chen as a Director

(b) Re-appointment of Mr. Lim Sin Hoa as a Director

6. Re-appointment of Auditors and fixing their remuneration

7. As special business - approval of general mandate for the Directors to issue newshares or convertible instruments

Dated this day of 2005.

Total Number ofShares Held

Signature(s) of Member(s)/Common Seal

IMPORTANT:

PLEASE READ NOTES OVERLEAF

IMPORTANT1. For investors who have used their CPF monies to buy Sing Investments &

Finance Limited shares, this Annual Report is forwarded to them at therequest of their CPF Approved Nominees and is sent solely FORINFORMATION ONLY.

2. This Proxy Form is not valid for use by CPF investors and shall be ineffectivefor all intents and purposes if used or purported to be used by them.

Percentage ofName Address NRIC/Passport shareholdings

Number represented

and / or (delete as appropriate):


NOTES:

1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint not more than two proxiesto attend and vote on his behalf.

2. Where a member appoints two proxies, he shall specify the percentage of his shares to be represented by each proxy andif no percentage is specified, the first named proxy shall be deemed to represent 100 per cent of the shareholding and thesecond named proxy shall be deemed to be an alternate to the first named.

3. A proxy need not be a member of the Company.

4. Please insert the total number of shares held by you. If you have shares entered against your name in the DepositoryRegister (as defined in Section 130A of the Companies Act, Chapter 50), you should insert that number of shares. If youhave shares registered in your name in the Register of Members of the Company, you should insert that number of shares.If you have shares entered against your name in the Depository Register and also in the Register of Members, you shouldinsert the aggregate number of shares. If no number is inserted, the instrument appointing a proxy or proxies will bedeemed to relate to all the shares held by you.

5. The instrument appointing a proxy or proxies must be deposited at the Company’s Registered Office at 135 Cecil Street#01-01 LKN Building, Singapore 069536 not less than 48 hours before the time set for the Meeting.

6. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorisedin writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed eitherunder its common seal or under the hand of its attorney or a duly authorised officer.

7. Where an instrument appointing a proxy or proxies is signed on behalf of the appointor by an attorney, the letter orpower of attorney or a duly certified copy thereof must (failing previous registration with the Company) be lodged withthe instrument of proxy, failing which the instrument may be treated as invalid.

8. The Company shall be entitled to reject any instrument appointing a proxy or proxies which is incomplete, improperlycompleted, illegible or where the true intentions of the appointor are not ascertainable from the instructions of theappointor specified in the instrument. In addition, in the case of shares entered in the Depository Register, the Companymay reject any instrument appointing a proxy or proxies if the member, being the appointor, is not shown to have sharesentered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, ascertified by The Central Depository (Pte) Limited to the Company.

SING INVESTMENTS & FINANCE LIMITED Co. Reg. No. 196400348D

135 Cecil Street, #01-01 LKN Builidng, Singapore 069536Tel: 6221 9998 Fax: 6225 0837 Website: www.sif.com.sg


sing investments & finance limited annualreport 2004

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