Marac still has bank aspirations

The finance company told brokers in a presentation yesterday it was still positioning itself to become a registered bank and is focused on improving its credit rating. Its Standard and Poor's rating was cut from BBB+ to BB+ last month, mainly due to its property development lending.

While it will continue to pursue its aspiration of becoming a bank, the lender told brokers it is well-positioned for the non-bank deposit taker regime when the central bank announces the new requirements.

The company reported a normalised net profit of $19.1 million in the 12 months ended June 30 from $25.9 million last year. The fall in earnings was put down to the $13.2 million cost of impaired assets, up from $5.7 million a year earlier.

"The mainstay of Marac's funding continues to be its retail debenture programme," which holds some $804 million as at June 30, the company said in a statement. "Retail investors have proven to be extremely loyal and have continued to support Marac with solid levels of new funding and reinvestments."