MIRA INFORM REPORT

Report Date :

16.01.2007

IDENTIFICATION DETAILS

Name :	APS ASSET MANAGEMENT PTE LTD
Registered Office :	^3 Anson Road, #23-01^, Springleaf Tower, Singapore^079909
Country :	Singapore
Financials (as on) :	31.12.2004
Date of Incorporation :	18/03/1980
Com. Reg. No.:	198000835G
Legal Form :	^Pte Ltd
Line of Business :	Providing Fund Management and Investment Advisory Advices.

RATING & COMMENTS

MIRA’s Rating :

Aa

RATING		STATUS	PROPOSED CREDIT LINE
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large

Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear

Subject Company

APS ASSET MANAGEMENT PTE LTD

Line Of Business 

PROVIDIING FUND MANAGEMENT AND INVESTMENT ADVISORY ADVICES.

Parent Company

ASIAN PORTFOLIO SPECIALISTS PTE LTD

(PERCENTAGE OF SHAREHOLDING: 86%)

Financial Elements

FY2004

CONSOLIDATED

Sales : S$32,763,092

Networth : S$38,477,832

Paid-Up Capital : S$ 3,044,333

Net result : S$20,000,334

Net Margin(%) : 61.05

Return on Equity(%) : 51.98

Leverage Ratio : 0.14 TIMES

Note: Based on Accounting and Corporate Regulatory Authority’s (ACRA) record dated 10/01/2007, the paid-up capital has increased to S$3,393,865.49.

Rating

Credit Rating : Sing $ 10000001 to Sing $ 50000000

COMPANY IDENTIFICATION

^{Subject Company : APS ASSET MANAGEMENT PTE LTD}

^{Former Name : SHENYIN WANGUO-APS MANAGEMENT PTE LTD}

^{Business Address : 3 ANSON ROAD}

^#23-01

^{SPRINGLEAF TOWER}

^{Town : SINGAPORE}

^{Postcode : 079909}

^{County : -}

^{Country : Singapore}

^{Telephone : 6333 8600}

^{Fax : 6333 8900}

^{ROC Number : 198000835G}

^{Reg. Town : -}

PREVIOUS IDENTIFICATION

^{SHENYIN WANGUO-APS MANAGEMENT PTE LTD (DATE OF CHANGE : 10/01/2000)}

^{SHANGHAI INTERNATIONAL-APS MANAGEMENT PTE LTD (DATE OF CHANGE : 30/11/1996)}

SUMMARY

^{All amounts in this report are in : SGD}

^{Legal Form : Pte Ltd}

^{Date Inc. : 18/03/1980}

^{Previous Legal Form : -}

^{Date of Change : 18/03/1980}

^{Summary year : 31/12/2004}

^{Sales : 32,763,092}

^{Net Worth : 38,477,832}

^{Capital : 4,000,000}

^{Paid-Up Capital : 3,044,333}

^{Employees : 40}

^{Net Result : 20,000,334}

^{Auditor : DELOITTE & TOUCHE}

REFERENCES

^{Litigation : No}

^{Company status : TRADING}

^{Started : 18/03/1980}

PRINCIPAL(S)

^{SIM POH HENG S0337319C Director}

DIRECTOR(S)

^{LIU JI S6882644F Director}

^{Appointed on : 16/05/1995}

^{Street : ROOM 1416, NO 161}

^{LUJIAZUI EAST ROAD,}

^{CHINA MERCHANT TOWER, PUDONG DISTR}

^{Town : ISHANGHAI 20}

^{Postcode : -}

^{Country : China}

^{WONG FOOK CHOY SUNNY S1205238C Company Secretary}

^{Appointed on : 16/05/1995}

^{Street : 70 JALAN SIMPANG BEDOK}

^{CANARY PARK}

^{Town : SINGAPORE}

^{Postcode : 488205}

^{Country : Singapore}

^{WONG KOK HOI S2664912I Director}

^{Appointed on : 01/04/1995}

^{Street : 54 DUNBAR WALK}

^{FRANKEL ESTATE}

^{Town : SINGAPORE}

^{Postcode : 459355}

^{Country : Singapore}

^{PIETER VAN PUTTEN S2709027C Director}

^{Appointed on : 01/12/2003}

^{Street : 23 CASSIA DRIVE}

^{RAFFLES PARK}

^{Town : SINGAPORE}

^{Postcode : 289716}

^{Country : Singapore}

^{LIU JI S6882644F Director}

^{Appointed on : 06/03/2000}

^{Street : ROOM 1416, NO 161}

^{LUJIAZUI EAST ROAD,}

^{CHINA MERCHANT TOWER, PUDONG DISTR}

^{Town : ISHANGHAI 20}

^{Postcode : -}

^{Country : China}

^{SIM POH HENG S0337319C Director}

^{Appointed on : 25/04/2000}

^{Street : 7 HIGHLAND WALK}

^{HIGHLAND COTTAGES}

^{Town : SINGAPORE}

^{Postcode : 549044}

^{Country : Singapore}

^{LIM HEONG CHYE S1174860J Director}

^{Appointed on : 12/12/2005}

^{Street : 19 BEDOK LANE}

^{SIEW LIM PARK}

^{Town : SINGAPORE}

^{Postcode : 469776}

^{Country : Singapore}

^{TAN KONG YAM S1852046Z Director}

^{Appointed on : 28/07/2005}

^{Street : 23 JALAN MENGKUDU}

^{SEMBAWANG HILLS ESTATE}

^{Town : SINGAPORE}

^{Postcode : 577399}

^{Country : Singapore}

FORMER DIRECTOR(S)

^{NG TENG HEE ERIC S1761598Z}

^{YU QIHAO P0108575}

^{GAO GUOFU 2451708}

^{CHONG SOK UN SHIRLEY 257157}

ACTIVITY (IES)

^{HOLDING COMPANIES Code: 11320}

^{INVESTMENT ADVISORY SERVICE Code: 12080}

^{BASED ON ACRA'S RECORD AS AT 10/01/2007}

^{1) BANK/FINANCIAL HOLDING COMPANIES; HOLDING COMPANIES}

CHARGES

No Charges On Premises/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{DBS BANK LTD.}

SHAREHOLDERS(S)

^{ASIAN PORTFOLIO SPECIALISTS PTE 27,460,000 Company}

^{Street : 3 ANSON ROAD}

^#23-01

^{SPRINGLEAF TOWER}

^{Town : SINGAPORE}

^{Postcode : 079909}

^{Country : Singapore}

^{STELLA ZHANG QING 316,667 Private Person}

^{Street : ROOM 1416, NO 161 LUJIAZUI EAST RD}

^{CHINA MERCHANT TOWER,}

^{PUDONG DISTRICT}

^{Town : SHANGHAI}

^{Postcode : 200120}

^{Country : China}

^{WONG LEE CHAN 770,000 Private Person}

^{Street : 54 DUNBAR WALK}

^{FRANKEL ESTATE}

^{Town : SINGAPORE}

^{Postcode : 459355}

^{Country : Singapore}

^{WONG LEE LEE 826,667 Private Person}

^{Street : 82 BAYSHORE ROAD}

^#08-31

^{COSTA DEL SOL}

^{Town : SINGAPORE}

^{Postcode : 469993}

^{Country : Singapore}

^{DR LEE KONG 300,000 Private Person}

^{Street : 54 DUNBAR WALK}

^{FRANKEL ESTATE}

^{Town : SINGAPORE}

^{Postcode : 459355}

^{Country : Singapore}

^{SIM TEOW PIN 426,667 Private Person}

^{Street : 22 JANSEN ROAD}

^{Town : SINGAPORE}

^{Postcode : 548420}

^{Country : Singapore}

^{TAN KONG YAM 300,000 Private Person}

^{Street : 23 JALAN MENGKUDU}

^{SEMBAWANG HILLS ESTATE}

^{Town : SINGAPORE}

^{Postcode : 577399}

^{Country : Singapore}

^{WONG KOK HOI 533,334 Private Person}

^{Street : 54 DUNBAR WALK}

^{FRANKEL ESTATE}

^{Town : SINGAPORE}

^{Postcode : 459355}

^{Country : Singapore}

^{LIU JI 700,000 Private Person}

^{Street : ROOM 1416, NO 161}

^{LUJIAZUI EAST ROAD,}

^{CHINA MERCHANT TOWER, PUDONG DISTR}

^{Town : ISHANGHAI 20}

^{Postcode : -}

^{Country : China}

^{SIM POH HENG 133,334 Private Person}

^{Street : 7 HIGHLAND WALK}

^{HIGHLAND COTTAGES}

^{Town : SINGAPORE}

^{Postcode : 549044}

^{Country : Singapore}

^{CHAN HOCK FAI 43,333 Private Person}

^{Street : 41 BANGKIT ROAD}

^#15-03

^CHESTERVALE

^{Town : SINGAPORE}

^{Postcode : 679978}

^{Country : Singapore}

^{HO KOK HUA 43,333 Private Person}

^{Street : 38 BEO CRESCENT}

^#10-46

^{Town : SINGAPORE}

^{Postcode : 160038}

^{Country : Singapore}

^{LOW SAY PING 3,333 Private Person}

^{Street : 25 ROBIN ROAD}

^#01-01

^{YING MANSIONS}

^{Town : SINGAPORE}

^{Postcode : 258203}

^{Country : Singapore}

FORMER SHAREHOLDER(S)

^{SHANGHAI INTERNATIONAL HOLDINGS 900,000}

^{JOSEPHINE CHUA GIM ENG 200,000}

HOLDING COMPANY

^{ASIAN PORTFOLIO SPECIALISTS PTE 198703574W % : 86.00}

SUBSIDIARY (IES)

^{APS ASSET MANAGEMENT (JAPAN) CO LTD Japan}

^{APS CHINA RESEARCH PTE LTD China}

^{APS ASSET MANAGEMENT (USA) LLC United States of America}

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality : AVERAGE}

^{Liquidity : ABUNDANT}

^{Payments : REGULAR}

^{Trend : UPWARD}

^{Financial Situation : GOOD}

LITIGATION(S)

No Litigation In Our Database

FINANCIAL ELEMENTS

^{All amounts in this report are in : SGD}

^{Audit Qualification: UNQUALIFIED (CLEAN) UNQUALIFIED (CLEAN)}

^{Date Account Lodged: 14/06/2005}

^{Balance Sheet Date: 31/12/2004 31/12/2003}

^{Number of weeks: 52 52}

^{Consolidation Code: CONSOLIDATED CONSOLIDATED}

^{--- ASSETS ---}

^{Tangible Fixed Assets: 465,807 152,764}

^{Investments 26,842,496 11,080,259}

^{Total Fixed Assets: 27,308,303 11,233,023}

^{Receivables: 11,821,260 7,085,578}

^{Cash, Banks, Securities: 4,486,678 3,093,187}

^{Other current assets: 394,337 327,546}

^{Total Current Assets: 16,702,275 10,506,311}

^{TOTAL ASSETS: 44,010,578 21,739,334}

^{--- LIABILITIES ---}

^{Equity capital: 3,044,333 3,016,000}

^{Reserves: 546,958 526,613}

^{Profit & loss Account: 34,647,135 14,769,163}

^{Other: 177,736 170,110}

^{Surplus equity: 61,670 61,670}

^{Total Equity: 38,477,832 18,543,556}

^{L/T deferred taxes: 57,000 57,000}

^{Total L/T Liabilities: 57,000 57,000}

^{Trade Creditors: 51,500 394,348}

^{Provisions: 2,913,757 1,532,712}

^{Other Short term Liab.: 153,266 341,193}

^{Prepay. & Def. charges: 2,357,223 870,525}

^{Total short term Liab.: 5,475,746 3,138,778}

^{TOTAL LIABILITIES: 5,532,746 3,195,778}

PROFIT & LOSS ACCOUNT

^{Net Sales 32,763,092 17,523,560}

^{NET RESULT BEFORE TAX: 22,916,342 11,249,471}

^{Tax : 2,916,008 1,551,794}

^{Net income/loss year: 20,000,334 9,697,677}

^{Depreciation: 159,850 107,771}

^{Directors Emoluments: 2,744,163 1,494,314}

^{Wages and Salaries: 3,481,318 2,527,366}

^{Financial Income: 20,218 7,843}

RATIOS

^{31/12/2004 31/12/2003}

^{Turnover per employee: 819077.30 438089.00}

^{Net result / Turnover(%): 0.61 0.55}

^{Net Margin(%): 61.05 55.34}

^{Return on Equity(%): 51.98 52.30}

^{Return on Assets(%): 45.44 44.61}

^{Net Working capital: 11226529.00 7367533.00}

^{Cash Ratio: 0.82 0.99}

^{Quick Ratio: 2.98 3.24}

^{Current ratio: 3.05 3.35}

^{Receivables Turnover: 129.89 145.56}

^{Leverage Ratio: 0.14 0.17}

^{Net Margin : (100*Net income loss year)/Net sales}

^{Return on Equity : (100*Net income loss year)/Total equity}

^{Return on Assets : (100*Net income loss year)/Total fixed assets}

^{Net Working capital : (Total current assets-Total short term liabilities)}

^{Cash Ratio : Cash Bank securities/Total short term liabilities}

^{Quick Ratio : (Cash Bank securities+Receivables)/Total Short term liabilities}

^{Current ratio : Total current assets/Total short term liabilities}

^{Receivables Turnover : (Receivable*360)/Net sales}

^{Leverage Ratio : Total liabilities/(Total equity-Intangible assets)}

FINANCIAL COMMENTS

^{THE LATEST FINANCIAL STATEMENTS FILED IN AS AT YEAR ENDED 31 DECEMBER 2004 WERE DEEMED OUTDATED. AS SUCH, FINANCIAL ANALYSIS IS NOT CARRIED OUT. FY2004 AND FY2003 FINANCIALS SERVE AS A REFERENCE ONLY.}

^{IN REPLACE, ADVERSE CHECKS ON THE LOCAL DIRECTORS WOULD BE CONDUCTED.}

^{NOTES TO THE FINANCIAL STATEMENTS:}

^{CREDIT RISK}

^{THE GROUP DOES NOT HAVE ANY SIGNIFICANT CREDIT RISK EXPOSURE OR CONCENTRATION OF RISK TO ANY SINGLE COUNTERPARTY OR ANY GROUP OF COUNTERPARTS HAVING SIMILAR CHARACTERISTICS EXCEPT THAT AS AT DECEMBER 31, 2004 THE GROUP HAS TRADE RECEIVABLES DUE FROM 5 OUTSIDE PARTIES AND RELATED PARTIES REPRESENTING 61% (2003: 37%) OF THE TOTAL TRADE RECEIVABLES, RESPECTIVELY.}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 18/03/1980 AS A LIMITED PRIVATE COMPANY AND WAS FORMERLY KNOWN AS "SHENYIN WANGUO-APS MANAGEMENT PTE LTD".}

^{ON 09/03/1995, SUBJECT CHANGED ITS NAMESTYLE TO "SHANGHAI INTERNATIONAL-APS MANAGEMENT PRIVATE LIMITED".}

^{SUBSEQUENTLY ON 06/02/2004, SUBJECT AGAIN CHANGED TO ITS PRESENT NAMESTYLE OF "APS ASSET MANAGEMENT PTE LTD".}

^{AS AT 10/01/2007, SUBJECT HAS AN ISSUED AND PAID-UP CAPITAL OF 31,856,668 SHARES OF A VALUE OF S$3,393,865.49.}

^{PRINCIPAL ACTIVITIES:}

^{SUBJECT IS REGISTERED WITH THE ACCOUNTING & CORPORATE REGULATORY AUTHORITY (ACRA) TO BE PRINCIPALLY ENGAGED IN THE BUSINESS OF:}

^{1) BANK/FINANCIAL HOLDING COMPANIES; HOLDING COMPANIES}

^{DURING THE FINANCIAL YEAR(S), UNDER REVIEW, SUBJECT'S AND ITS SUBSIDIARIES' PRINCIPAL ACTIVITIES ARE THAT OF PROVIDIING FUND MANAGEMENT AND INVESTMENT ADVISORY ADVICES.}

^{THE COMPANY IS A SUBSIDIARY OF ASIAN PORTFOLIO SPECIALISTS PTE LTD, INCORPORATED IN SINGAPORE WHICH IS ALSO THE COMPANY'S ULTIMATE HOLDING COMPANY.}

^{FROM THE RESEARCH CONDUCTED, THE FOLLOWING INFORMATION WAS GATHERED:}

^{SUBJECT IS LISTED IN THE SINGAPORE LOCAL DIRECTORY UNDER THE CLASSIFICATION OF: INVESTMENT ADVISORY ADVICES.}

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITY:}

^{* INVESTMENT MANAGEMENT SPECIALISING IN ASIAN EQUITIES}

^{* FUND MANAGEMENT}

^{SUBJECT ALSO HAS OFFICES IN TOKYO, SHANGHAI AND NEW YORK.}

^{SUBJECT'S CLIENTS ARE BASED IN BOTH EUROPE, NORTH AMERICA AND ASIA, AND INCLUDE PUBLIC AND PRIVATE PENSION FUNDS, FOUNDATIONS, INSURANCE COMPANIES, CENTRAL BANKS, GOVERNMENT AGENCIES AND FAMILY OFFICES. SUBJECT ALSO MAINTAINS STRONG RELATIONSHIPS WITH CONSULTANTS WORLDWIDE AND HAVE BEEN INCLUDED IN THEIR GLOBAL MULTI-MANAGER PROGRAMS.}

^{NUMBER OF EMPLOYEES (31 DECEMBER):}

^{* GROUP - 2004: 40 (2003: 34)}

^{REGISTERED AND BUSINESS ADDRESS:}

^{3 ANSON ROAD}

^#23-01

^{SPRINGLEAF TOWER}

^{SINGAPORE 079909}

^{DATE OF CHANGE OF ADDRESS: 20/11/2006}

^{-- RENTED PREMISE}

^{-- PREMISE OWNED BY: UNITED OVERSEAS BANK LIMITED}

^{JAPAN OFFICE:}

^{APS ASSET MANAGEMENT (JAPAN) CO. LTD.}

^{TOGIN BUILDING, FIFTH FLOOR}

^{1-4-2 MARUNOUCHI, CHIYODA-KU}

^{TOKYO, JAPAN 100-0005}

^{PHONE: (813) 3 214 2721}

^{FAX: (813) 3 214 2722}

^{EMAIL: japan@aps.com.sg}

^{CHINA OFFICE:}

^{APS CHINA RESEARCH PTE. LTD.}

^{#2701 AZIA CENTER}

^{1233 LUJIAZUI RING ROAD}

^{SHANGHAI 200120}

^CHINA

^{PHONE: (86) 21 5879 0091}

^{FAX: (86) 21 5047 2580}

^{EMAIL: jamesliu@aps.com.sg}

^WEBSITE:

^{* http://www.aps.com.sg}

^EMAIL:

^{* info@aps.com.sg}

MANAGEMENT

^{THE DIRECTORS AT THE TIME OF THIS REPORT ARE:}

^{1) SIM POH HENG, A SINGAPOREAN}

^{- HOLDS OTHER DIRECTORSHIP AS RECORDED IN OUR DATABASE}

^{PCS SECURITY PRIVATE LIMITED}

^{2) LIM HEONG CHYE, A SINGAPOREAN}

^{- HOLDS NO OTHER DIRECTORSHIP AS RECORDED IN OUR DATABASE}

^{3) TAN KONG YAM, A SINGAPOREAN}

^{- HOLDS NO OTHER DIRECTORSHIP AS RECORDED IN OUR DATABASE}

^{4) WONG KOK HOI, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS NO OTHER DIRECTORSHIP AS RECORDED IN OUR DATABASE}

^{5) PIETER VAN PUTTEN, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS NO OTHER DIRECTORSHIP AS RECORDED IN OUR DATABASE}

^{6) LIU JI, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS NO OTHER DIRECTORSHIP AS RECORDED IN OUR DATABASE}

ADVERSE ON DIRECTORS

^{DIRECTOR'S NAME: SIM POH HENG}

^{ADVERSE REPORT AGAINST DIRECTOR: NIL}

^{PROPERTY OWNERSHIP: OWNS 1}

^{ANNUAL VALUE: S$24,000}

^{CO-OWNER: TAN SIOK HOON}

^{DIRECTOR'S NAME: LIM HEONG CHYE}

^{ADVERSE REPORT AGAINST DIRECTOR: NIL}

^{PROPERTY OWNERSHIP: OWNS 1}

^{ANNUAL VALUE: S$19,800}

^{CO-OWNER: CHIA POH CHOO JOYCE}

^{DIRECTOR'S NAME: TAN KONG YAM}

^{ADVERSE REPORT AGAINST DIRECTOR: NIL}

^{PROPERTY OWNERSHIP: OWNS 1}

^{ANNUAL VALUE: S$16,200}

^{CO-OWNER: CHIANG LEE ENG}

^{DIRECTOR'S NAME: WONG KOK HOI}

^{ADVERSE REPORT AGAINST DIRECTOR: NIL}

^{PROPERTY OWNERSHIP: OWNS 1}

^{ANNUAL VALUE: S$64,800}

^{CO-OWNER: NG KIT YEE}

^{DIRECTOR'S NAME: PIETER VAN PUTTEN}

^{ADVERSE REPORT AGAINST DIRECTOR: NIL}

^{PROPERTY OWNERSHIP: NIL}

^{ANNUAL VALUE: NA}

^{CO-OWNER: NA}

^{DIRECTOR'S NAME: LIU JI}

^{ADVERSE REPORT AGAINST DIRECTOR: NIL}

^{PROPERTY OWNERSHIP: UNABLE TO CONFIRM}

^{ANNUAL VALUE: UNABLE TO CONFIRM}

^{CO-OWNER: UNABLE TO CONFIRM}

^{ANNUAL VALUE IS THE ESTIMATED ANNUAL RENT THE PROPERTY CAN FETCH IF IT WERE RENTED OUT. THE ANNUAL VALUE IS DETERMINED IN THE SAME MANNER REGARDLESS OF WHETHER THE PROPERTY IS LET-OUT, OWNER-OCCUPIED OR VACANT.}

SINGAPORE'S COUNTRY RATING 2006

INVESTMENT GRADE

IN SINGAPORE, THE POLITICAL SITUATION APPEARS TO BE VERY STABLE.

ECONOMIC GROWTH IS BECOMING MORE MODERATE AS INVESTMENT HAS BEEN FLAT DUE TO INCREASING OIL PRICES AND LESS BUOYANT DEMAND FOR ELECTRONIC PRODUCTS.

ECONOMIC PERFORMANCE HAS REMAINED STRONG, UNDERPINNED BY PHARMACEUTICALS AND SERVICES. EXPORTS HAS BENEFITED FROM THE STEADINESS OF DEMAND FROM ITS MAIN TRADING PARTNERS, MALAYSIA, THE UNITED STATES, CHINA AND HONG KONG. OTHER THAN ITS BALANCED PUBLIC SECTOR ACCOUNTS, LIMITED FOREIGN DEBT AND COMFORTABLE FOREIGN CURRENCY RESERVES HAVE CONTRIBUTED TO SINGAPORE'S STRONG FINANCIAL CONDITION.

AS THE ELECTRONICS SECTOR FACES COMPETITION FROM THE ASIAN ECONOMIES, SINGAPORE HAS BEEN PURSUING DIVERSIFICATION STRATEGY THAT HAS BEEN CONSOLIDATING ITS POSITION. PHARMACEUTICALS ALREADY REPRESENT 10% OF EXPORTS IN COMPARATIVE TO ITS INSIGNIFICANT CONTRIBUTION IN YEAR 1995. ELECTRONICS SECTOR SECTOR'S SHARE HAS DECLINED FROM 80% TO 60% DURING THE SAME PERIOD. THERE IS HIGH RELIANCE ON DEVELOPMENT OF PETROCHEMICAL PRODUCTS, HIGH VALUE-ADDED SERVICES AND BIOTECHNOLOGIES.

ASSETS

- ONE OF THE MOST OPEN ECONOMIES IN THE WORLD WITH EXPORTS PLAYING A MAJOR

ROLE IN ITS PERFORMANCE.

- ONE OF ASIA'S MOST ADVANCED COUNTRIES IN QUALITY COMPETITIVENESS TERMS.

- WORKFORCE'S EDUCATION AND SKILL LEVEL IS VERY HIGH.

- A MAJOR EXPORT OF CAPITAL IN ASIA, PARTICULARLY THE STATE-OWNED HOLDING

COMPANY, TEMASEK.

- THE BUSINESS ENVIRONMENT HAS BEEN VERY FAVOURABLE.

- GREAT POLITICAL STABILITY.

WEAKNESSES

- ECONOMY REMAINED OVERSPECIALISED IN THE ELECTRONICS SECTOR.

- MUST ACCELERATE DIVERSIFICATION IN SERVICES TO MAINTAIN ITS LEAD OVER

OTHER ASIAN ECONOMIES

- REFORMS ARE STILL NEEDED TO FOSTER INNOVATION AND EDUCATION-SYSTEM

MODERNIZATION.

- AGING POPULATION COULD ULTIMATELY AFFECT ECONOMIC PERFORMANCE.

FINANCIAL SERVICES SECTOR

SINGAPORE BUDGET 2006

SINGAPORE HAS DEVELOPED INTO A KEY REGIONAL HUB IN ASIA FOR INTERNATIONAL CORPORATES WHICH HUB THEIR ASIAN OPERATIONAL HEADQUARTERS AS WELL AS REGIONAL FINANCIAL TREASURY AND RISK MANAGEMENT ACTIVITIES IN SINGAPORE. TO FACILITATE THESE ACTIVITIES FURTHER, THE SCOPE OF ACTIVITIES QUALIFYING FOR FINANCE AND TREASURY CENTRES INCENTIVE WILL BE EXPANDED TO INCLUDE TRADING AND ARRANGING OF DERIVATIVE PRODUCTS FOR THEIR NETWORK OF COMPANIES. FOR CORPORATES WHO LOOK TO MANAGE THEIR RISKS THROUGH CAPTIVE INSURANCE VEHICLES, TAX CONCESSION FOR APPROVED CAPTIVE INSURANCE COMPANIES WRITING OFFSHORE RISKS HAS BEEN ENHANCED. THIS WILL IN ADDITION CREATE BENEFICIAL SPIN-OFFS TO SINGAPORE'S STATUS AS AN INSURANCE AND REINSURANCE CENTRE. 

TO LEVEL THE PLAYING FIELD FOR ISLAMIC FINANCIAL PRODUCTS IN SINGAPORE, TAX TREATMENT FOR THESE PRODUCTS HAS BEEN ALIGNED. THESE CHANGES WILL FACILITATE PRODUCT INNOVATION AND BROADEN THE RANGE OF INSTRUMENTS AVAILABLE TO REGIONAL AND INTERNATIONAL INVESTORS.

SINGAPORE'S DERIVATIVES MARKET HAS SEEN STRONG GROWTH IN RECENT YEARS.  SINGAPORE IS THE SECOND LARGEST OTC DERIVATIVES CENTRE IN ASIA. SINGAPORE HAS ALSO FORGED A LEAD ROLE IN THE TRADING OF COMMODITIES. SINGAPORE IS CURRENTLY THE WORLD'S THIRD LARGEST OIL REFINING CENTRE, TOP BUNKER PORT, AND THE ASIA PACIFIC CENTRE FOR THE PRICING AND TRADING OF OIL AND RUBBER. TO REINFORCE SINGAPORE POSITION AS A MAJOR OIL-TRADING, SHIP-BROKING AND FINANCIAL RISK MANAGEMENT HUB, SINGAPORE WILL OFFER CONCESSIONARY TAX RATES TO FACILITATE THE CLEARING OF OTC DERIVATIVES IN SINGAPORE.

THE REITS MARKET IN SINGAPORE HAS ALSO SEEN STEADY GROWTH IN THE LAST YEAR. AS AT DECEMBER 2005, THERE WERE SEVEN LISTED REITS WORTH ALMOST S$12 BILLION. MEASURES HAVE BEEN INTRODUCED TO FURTHER ENCOURAGE REITS LISTED IN SINGAPORE TO GROW THEIR POOL OF FOREIGN ASSETS.

LOOKING AHEAD

PRIVATE BANKING

PRIVATE BANKS ARE ADDING STAFF IN SINGAPORE TO WIN BUSINESS IN THE REGION, HOME TO INDIA AND CHINA, WHICH HAVE THE FASTEST GROWTH AMONG THE WORLD’S 20 LARGEST ECONOMIES.

SINGAPORE’S PRIVATE BANKING INDUSTRY MAY EXPAND BY 25 PER CENT IN THE COMING YEAR, THE MOST IN THE WORLD, SAID MR DIDIER VON DAENIKEN, CO-HEAD OF PRIVATE BANKING FOR ASIA AND THE PACIFIC AT CREDIT SUISSE GROUP.

PRIVATE-WEALTH ASSETS UNDER MANAGEMENT IN SINGAPORE TOTAL US$200 BILLION (S$320 BILLION) WHICH IS 3 TO 5 PER CENT OF TOTAL WEALTH WORLDWIDE. SINGAPORE’S ASSET MANAGEMENT INDUSTRY IS GROWING AT 15 TO 20 PER CENT A YEAR.

ISLAMIC FINANCIAL SERVICES

SINGAPORE HAS STEPPED UP EFFORTS TO GROW ITS ISLAMIC FINANCIAL SERVICES MARKET AS THE CITY-STATE EXPANDS THE RANGE OF BANKING PRODUCTS COMPLIANT WITH SHARIA LAW. BANKS IN SINGAPORE CAN NOW OFFER MURABAHA INVESTMENT PRODUCTS, A TYPE OF FINANCING THAT REQUIRES THE BANK TO PURCHASE GOODS ON BEHALF OF THE CUSTOMER BEFORE SELLING THEM AT A MARK-UP, THE CENTRAL BANK SAID.

"WE HOPE THIS WILL FURTHER EXPAND THE RANGE OF ISLAMIC PRODUCTS FOR BOTH PRIVATE AND INSTITUTIONAL ISLAMIC ASSET MANAGEMENT IN SINGAPORE AND THE REGION," SAID HENG SWEE KEAT, MANAGING DIRECTOR OF THE MONETARY AUTHORITY OF SINGAPORE (MAS).

"WE BELIEVE THAT SINGAPORE, AS AN INTERNATIONAL FINANCIAL CENTRE, CAN AND SHOULD HAVE A FULL SUITE OF ISLAMIC FINANCIAL PRODUCTS THAT CAN MEET THE NEEDS OF BANKS AND INVESTORS," HENG SAID IN A SPEECH AT AN ISLAMIC FINANCE FORUM.

DEMAND FOR ISLAMIC FINANCING IS GROWING IN THE MIDDLE EAST AS WELL AS COUNTRIES WITH LARGE MUSLIM POPULATIONS, INCLUDING THOSE IN ASIA, HENG SAID, ADDING SINGAPORE WANTS TO GROW ITS SHARE OF THE MARKET.

A RECENT MOODY'S REPORT ESTIMATED THERE ARE 300 ISLAMIC FINANCIAL INSTITUTIONS WITH MORE THAN 250 BILLION US DOLLARS WORTH OF ASSETS GROWING AT 10-15 PERCENT A YEAR, HE SAID.

"THE FINANCIAL COMMUNITY IN SINGAPORE IS EXCITED BY THE RECENT GROWTH AND DEVELOPMENTS IN ISLAMIC BANKING AND FINANCE," HENG SAID. "OUR CURRENT STRENGTHS IN CONVENTIONAL FINANCING CAN SERVE AS A BASE FOR THE GROWTH OF ISLAMIC FINANCE, ESPECIALLY IN THE WHOLESALE AND CAPITAL MARKETS," HE SAID.

EXTRACTED FROM: THE STRAITS TIMES, SINGAPORE

MONETARY AUTHORITY OF SINGAPORE

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

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