MANHATTAN CARD COMPANY LIMITED
Interim Financial Information Disclosure Statements 30 June 2001
MANHATTAN CARD COMPANY LIMITED
We enclose herewith the Interim Financial Information Disclosure Statements for the financial period ended 30 June 2001. We confirm that the information
contained therein complies, in all material respects, with the Hong Kong Monetary Authority’s recommendations and is not false or misleading. policies have also been consistently applied. The accounting
All figures reported are based on the underlying accounting records for the Company and have been subjected to an analytical review to ensure that all figures have been correctly complied, in all material aspects, from the books and records of the Company.
Peter Wong Chief Executive Officer
Julian Fong Chief Financial Officer
1 August 2001
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MANHATTAN CARD COMPANY LIMITED 2001 Interim Consolidated Results
Financial Highlights
Profit after taxation for the first half of 2001 was HK$291 million, increased by HK$139 million, or 91%, from HK$152 million earned in the same period in 2000.
Net interest income increased by HK$135 million, or 25%, to HK$671 million. operating income increased by HK$16.8 million, or 12%, to HK$163 million.
Other
Operating expenses decreased by HK$104 million, or 27%, to HK$285 million.
Charge for bad and doubtful debts increased from HK$112 million to HK$196 million, an increase of 75%.
Credit card receivables increased by HK$295 million, or 5%, from December 2000.
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Manhattan Card Company Limited
Consolidated Profit and Loss Account
Figures in HK$'000 6 months ended 30 June 2001 6 months ended 30 June 2000
Interest income Interest expense Net interest income
854,771 (184,060) 670,711
695,928 (160,703) 535,225
Other operating income Other net gains Total income
162,903 2,152 835,767
146,055 681,280
Operating expenses
(284,765)
(388,840)
Operating profit before provisions
551,001
292,440
Charge for bad and doubtful debts
(196,156)
(112,401)
Profit before taxation
354,845
180,039
Taxation
(64,162)
(28,153)
Profit after taxation
290,683
151,886
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Manhattan Card Company Limited
Consolidated Balance Sheet
Figures in HK$'000 At 30 June 2001 At 31 December 2000
Assets
Cash and short-term funds Credit card receivables Other loans and advances Amount due from intermediate holding company Accounts receivable and prepayments Investment securities Purchased goodwill Fixed assets Total assets
539,199 6,174,066 1,777,925 273,747 169,747 8,014 746,433 101,135 9,790,266
538,935 5,878,872 1,938,907 66,380 155,270 8,014 765,737 103,541 9,455,656
Liabilities
Amounts due to intermediate holding company Other accounts payable and provisions Total liabilities
7,038,809 409,506 7,448,315
7,012,508 391,879 7,404,387
Capital resources
Share capital Reserves Total capital resources
199,424 2,142,528 2,341,952
199,424 1,851,845 2,051,269
Total liabilities and capital resources
9,790,266
9,455,656
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Manhattan Card Company Limited
Supplementary Information
Figures in HK$'000 At 30 June 2001 At 31 December 2000
1.
Advances, Other Accounts and Provisions Gross advances to customers Gross advances to banks and other financial institutions Accrued interest and other accounts Specific provision for bad and doubtful debts - Advances to customers - Advances to banks and other financial institutions - Accrued interest and other accounts 84,368 74,352 169,747 155,270 8,036,359 7,892,131 -
2.
Analysis of Gross Amount of Advances to Customers By Industry Sector and By Country - Credit card advances to individuals - Other advances to individuals 6,241,086 1,795,273 5,942,458 1,949,673
The Company operates predominantly in Hong Kong and mainly derives income from Hong Kong, with credit card as the main business. 3. Overdue Advances At 30 June 2001
% of Customer HK$’000 Advances HK$’000
At 31 December 2000
% of Customer Advances
Credit card receivables Which have been overdue Six months or less but over three months Other overdue loans Six months or less but over three months 9,735 0.5% 7,814 0.4% 37,160 0.6% 44,477 0.7%
The Company did not have advances which were overdue more than six months as at 30 June 2001 and 31 December 2000.
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Manhattan Card Company Limited
Supplementary Information
Figures in HK$'000 At 30 June 2001 At 31 December 2000
4.
The Company had no rescheduled loans and advances as at 30 June 2001 and 31 December 2000.
5.
Non-performing Advances to Customers
Non-accrual advances Accrual advances
1,592 112,839
343 98,515
Gross non-performing advances to customers
114,431
98,858
Suspended interest
68
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Specific provisions for non-performing advances
65,562
74,352
Gross non-performing advances as a percentage of gross advances to customers
1.42%
1.25%
Advances are classified as non-performing when there is reasonable doubt about the ultimate collectibility of principal or interest. In general, advances which are more than three months overdue are classified as non-performing. However, there are advances that are not yet three months overdue but considered doubtful. advances. These advances are included in non-performing
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Manhattan Card Company Limited
Supplementary Information
Figures in HK$'000 At 30 June 2001 At 31 December 2000
6.
Reconciliation between Overdue Advances and Non-performing Advances
Advances which are overdue for more than three months Add: Overdue for less than three months and on which interest is being placed in suspense or on which interest accrual has ceased
46,895
52,291
367
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Less: Advances which are overdue for more than three months and on which interest is still being accrued
(45,670)
(51,948)
Non-accrual advances to customers
1,592
343
Accrual advances
112,839
98,515
Gross non-performing advances to customers
114,431
98,858
7.
Liquidity Ratio
6 months ended 30 June 2001
6 months ended 30 June 2000 166.7%
Average liquidity ratio for the period
37.57%
The liquidity ratio is computed as the Company's simple average of each calendar month's average liquidity ratio during the period in accordance with the Fourth Schedule of the Hong Kong Banking Ordinance.
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Manhattan Card Company Limited
Supplementary Information
Figures in HK$'000 At 30 June 2001 At 31 December 2000
8.
Off-balance Sheet Exposures
Contingent Liabilities, Commitments and Derivatives
(a) The contractual or notional amounts
Other commitments: Undrawn facilities under 1 year or which are unconditionally cancelable 29,391,369 29,044,636
The contractual or notional amounts of off-balance sheet instruments indicate the volume of transactions outstanding as at the balance sheet date; they do not represent amounts at risk.
(b) The credit risk weighted amounts
Other commitments: Undrawn facilities under 1 year or which are unconditionally cancelable -
The credit risk weighted amounts are the amounts which have been computed in accordance with the Third Schedule of the Banking Ordinance and guidelines issued by the Hong Kong Monetary Authority. The amounts calculated are dependent upon the status of the counterparty and the maturity characteristics of each type of contract.
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Manhattan Card Company Limited
Supplementary Information
Figures in HK$’000 At 30 June 2001 At 31 December 2000
9.
Currency Risk
USD Spot assets Spot liabilities Forward purchases Forward sales Net long/(short) position 6,189 (1,992) 4,197 10,025 (779,254) (769,229)
The net positions or net structural positions in foreign currencies are disclosed when each currency constitutes 10% or more of the respective total net position or total net structural position in all foreign currencies. As at 30 June 2001, only US dollar met the disclosure requirements. The Company had no foreign currency structural positions.
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Manhattan Card Company Limited
Supplementary Information
Figures in HK$'000 At 30 June 2001 10. Capital and Capital Adequacy Information At 31 December 2000
(a) Unadjusted capital adequacy ratio (b) Components of capital base after deductions Core capital : Paid up ordinary share capital Share premium Reserves Less: Goodwill Total core capital
18.83%
15.52%
199,424 2,455,657 (313,083) 746,433 1,595,565
199,424 2,455,657 (603,766) 765,737 1,285,578
Total capital base before deductions Deductions from total capital base : Exposures to connected companies Total capital base after deductions
1,595,565
1,285,578
8,014 1,587,551
8,014 1,277,564
The unadjusted capital adequacy ratio represents the ratio as at period end computed in accordance with the Third Schedule of the Banking Ordinance. The Company does not maintain any trading position and has met the Hong Kong Monetary Authority’s de minimis criteria for reporting of market risks. adjusted capital adequacy is not required accordingly. The computation of
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