Finance Companies Will Benefit - Hanover Group

Finance Companies Will Benefit - Hanover Group

Any shakeout of marginal finance companies will be to the benefit of well managed and well governed finance companies, according to Hanover Group Chairman, Greg Muir.

Greg Muir, who chairs New Zealand’s largest privately owned financial services group with more than $1 billion in funds under management and $100 million in shareholder equity, says in the current climate investors are likely to seek the security of solid and reliable finance companies operating at the upper end of the market.

Hanover Group has today indicated that its largest finance company – Hanover Finance Limited – is likely to post a 20 percent increase in before tax operating profit for the year to June 2006 representing profit before tax of $55 million (unaudited).

Greg Muir says while the profit figure is indicative, this would be a very impressive result in the context of the current environment. “This clearly demonstrates to investors and the market in general that not all finance companies are equal. Those that have focused on, and invested in, good governance standards are well positioned to not only weather the storm – but to flourish.”

“Rather than chasing growth, Hanover Group has made governance issues its number one priority. We’re proud of the business practices we have developed which establish a firm platform for continuing performance. A key element of the group’s approach has been to appoint independent directors. Of the six directors of the finance companies within the Hanover financial services group three are independent, including me as Chairman. I believe investors are increasingly seeing the value of this.

“Hanover Group is also actively supporting government regulation of the finance industry for finance companies through higher barriers to entry and for financial intermediaries through regulation. Greg Muir says, “We are currently working with a Ministry of Economic Development task group to progress these issues which we believe would result in important safeguards for finance company investors.

The Hanover financial services group services more than 100,000 investors and lending clients across its finance businesses.

ENDS

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