BERJAYA GROUP BERHAD - Berjaya Corporation Berhad

28
CEO’s Review Of Operations
under Bank Negara Malaysia’s regulations as at
30 April 1998, the company had sufficient
admitted assets to meet the higher margin of
solvency and still maintain a surplus of RM20
million in the Insurance Fund.
In May 1997, the company established its own
health insurance department to underwrite
health insurance. For the year under review,
new health insurance products for corporations
as well as individuals were introduced and
these were well-received by the company’s
clients and agency force. The company expects
further growth in this class of insurance to
complement its existing businesses.
During the year, Berjaya General Insurance
continued its series of seminars to upgrade
agents’ product knowledge and skills. These
seminars were conducted in Kuala Lumpur to
cover the more advanced technical aspect of
the products. Towards the end of the financial
year, an agency convention was held at
Equatorial Hotel in Cameron Highland, Pahang
for more than 110 agents who have contributed
significantly towards the company’s business
growth. As in the previous year, the three-day
convention and training, representing one of
the major events for the company was wellreceived.
The convention also provided a good
platform for the management, staff and agency
leaders to interact and exchange valuable ideas
towards enhancing the company’s services and
marketing strategies.
With the current regional economic turmoil
and increasing margin of solvency
requirement, claim costs are expected to
escalate as policy holders become more claim
conscious in an environment of increasing
competition for market share and premium
growth. Notwithstanding the above, the
company is optimistic of achieving a
reasonable underwriting profit and an
improved return in investment income for
the coming year.
HIRE PURCHASE AND LEASING
Despite the economic downturn, Prime Credit
Leasing Sdn Bhd continued to show growth.
Operating income for the financial year
increased by 32.7% from RM26.6 million to
RM35.3 million, mainly boosted by the growth
in hire purchase, money lending and share
financing.
However, pre-tax profit dropped significantly
from RM11.2 million registered last year to
about RM0.9 million mainly due to a more
prudent policy of provision for doubtful debts
adopted by the company. In addition, the
company incurred losses on disposal of shares
amounting to RM1.6 million as compared to
gains of RM21.3 million last year.
PRINTING
MACHINES
UNDER LEASE
FROM PRIME
CREDIT
LEASING.
During the year, Prime Credit Leasing
increased its paid-up capital from RM100
million to RM150 million to strengthen its
capital base and enhance its competitiveness in
the industry. To expand its market share, the
company is positioning itself to capture
business opportunities in the Small and
Medium Scale Industries (SMIs) and exportbased
manufacturing companies.
The coming year will be a consolidation period
for Prime Credit Leasing due to the economic
slowdown, tight liquidity in the financial
system and high borrowing costs.
The company will constantly plan and improve
its credit policies as well as the quality of its