Financial Services
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Financial Leasing
The Group offers financial leasing services in China through Rongzhong International Financial Leasing Co., Ltd. ("Rongzhong Leasing"), a 50.055% owned subsidiary of the Group.
Established in Wuhan with US$20 million registered capital under the wholly-foreign owned leasing license issued by the Ministry of Commerce of China, Rongzhong Leasing offers the following leasing services to our customers across the nation: direct leasing, sales and leaseback, operating lease, leveraged leasing, lease with manufacturerˇ¦s buy-back undertaking, financial leasing advisory and consulting service. Our target customer group is mainly small-and-medium enterprises ("SMEs") across the mainland China in the following specialized industries: optoelectronics and laser, textile and garment, plastics, and natural resources processing, etc. In addition, we also serve hospitals and medical centres by financing medical equipment purchases.
We commenced the financial leasing business in August 2008 by completing the first direct leasing transaction of about HK$6.7 million with a customer located in Wuhan. Since then, our business operation has been growing in a tremendous pace in terms of both transaction value and customer base. The carrying value of finance lease receivable reached approximately HK$855 million as at 30 September 2011 and our customers span over various provinces and cities of China, including but not limited to, Anhui, Beijing, Guangdong, Guizhou, Hebei, Henan, Hubei, Hunan, Jiangsu, Jiangxi, Jilin, Liaoning, Shaanxi, Shandong, Shanghai, Shanxi, Sichuan, Tianjin and Zhejiang.
Being a sizable financial leasing company based in Central China to serve SME customers, we are devoted to product innovation and vigorous market expansion to meet every customer's needs. After spending the first two years on building up a strong foundation for growth, we had proudly entered into the strong growth stage of our financial leasing business which is a major and stable income source of the Group. The Group is planning to strengthen the capital bases of Rongzhong Leasing by further injecting approximately US$20 million into its registered capital to fuel the long term growth.
Financing
The Group offers financing services to individual and small-and-medium enterprise ("SME") customers in China mainly through New Rongzhong Group, a 40% owned associated company. These financing services comprise the provision of bridging loans for application or renewal of banking facilities, deposits for tender bidding, financing for management buyout, acquisition, disposal and project development, as well as investment management service.
New Rongzhong Group first launched the financing service in Wuhan, China, in April 2006 and subsequently extended to Chongqing, Chengdu, Jiangsu and Guangzhou. Over these years, New Rongzhong Group had achieved a remarkable growth in this business segment with the gross loan portfolio reached approximately HK$1,192 million as at 30 September 2011.
With the extensive network established over these years and the new capital of US$90 million raised in October 2011, New Rongzhong Group expects to continue capitalizing the existing platform for sustainable growth.
Loan Guarantee
The Group carries on loan guarantee business in China through New Rongzhong Group, a 40% owned associated company, which provides loan guarantee and related services in seven cities of China, namely Changsha, Chengdu, Chongqing, Guangzhou, Hangzhou, Nanjing and Wuhan. This loan guarantee service is offered to individual and small-and-medium enterprise ("SMEs") customer to secure their bank loans which are mainly (1) working capital loans; (2) motor-vehicle loans and (3) real estate properties loans.
With around 10 years of operation, New Rongzhong Group has developed strong and cohesive business relationship with SMEs and banks, which is vital to succeed in doing the financial service business. Since January 2005, the accumulated amount of bank loans guaranteed by New Rongzhong Group has exceeded RMB16 billion in which approximately RMB2 billion remained outstanding as at 30 September 2011.
