Jewellery firm Aspial goes into pawnbroking business
Group secures one licence and is applying for another four
By OH BOON PING 17 February 2009
Aspial Corporation - formerly known as Lee Hwa Holdings - is going into the pawnbroking business and it is not content with just one single licence.
The jewellery manufacturing and retail group said yesterday that it is applying for pawnbroking licences for four other subsidiaries, after securing one for its wholly owned unit Maxi-Cash (Central 1).
The four are Maxi-Cash Group, Maxi-Cash (Central), Maxi-Cash (West) and Maxi-Cash (East).
Aspial said that its vast experience in jewellery retailing and past knowledge of the pawnbroking industry will enable it to take advantage of the growth potential of and to compete effectively in the pawnbroking market in Singapore.
‘The group expects the pawnbroking business to provide the group with earnings growth potential, greater resilience to economic downturns and reduce the volatility in earnings of the group which are currently derived mainly from the jewellery and property development businesses.’
The transactions are not expected to have any material impact on the net tangible assets or earnings per share of the group for the financial year ending Dec 31, 2009. For the first half of FY2008, Aspial had reported a 63 per cent jump in net income to $7.7 million, while revenue rose 37 per cent to $118 million.
The pawnbroking business has had a long history in Singapore, tracing its beginnings to 1875. Its core business is giving out loans to walk-in pawners who present valuables as collateral (pledges).
Pawnbrokers make most of their profits from the interest differentials between the interests charged on the loans and the cost of the loan capital.
They are allowed to auction off unredeemed pledges. About 90 per cent of the pledges accepted by pawnbrokers are thus gold and jewellery.
In Singapore, the pawnbroking business was brought in by Chinese immigrants, particularly the Hakka community in the 19th century.
In the past, pawnshops were known as the ‘poor man’s banker’. The objects pawned ranged from household items such as irons, sewing machines and blankets to jewellery such as gold necklaces, bracelets, diamonds and watches.
Nowadays, pawners also include businessmen who need quick cash for their business and people who make use of pawnshops as their ‘safe deposit box’ while they travel overseas.
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Jewellery firm Aspial goes into pawnbroking business
Group secures one licence and is applying for another four
By OH BOON PING
17 February 2009
Aspial Corporation - formerly known as Lee Hwa Holdings - is going into the pawnbroking business and it is not content with just one single licence.
The jewellery manufacturing and retail group said yesterday that it is applying for pawnbroking licences for four other subsidiaries, after securing one for its wholly owned unit Maxi-Cash (Central 1).
The four are Maxi-Cash Group, Maxi-Cash (Central), Maxi-Cash (West) and Maxi-Cash (East).
Aspial said that its vast experience in jewellery retailing and past knowledge of the pawnbroking industry will enable it to take advantage of the growth potential of and to compete effectively in the pawnbroking market in Singapore.
‘The group expects the pawnbroking business to provide the group with earnings growth potential, greater resilience to economic downturns and reduce the volatility in earnings of the group which are currently derived mainly from the jewellery and property development businesses.’
The transactions are not expected to have any material impact on the net tangible assets or earnings per share of the group for the financial year ending Dec 31, 2009. For the first half of FY2008, Aspial had reported a 63 per cent jump in net income to $7.7 million, while revenue rose 37 per cent to $118 million.
The pawnbroking business has had a long history in Singapore, tracing its beginnings to 1875. Its core business is giving out loans to walk-in pawners who present valuables as collateral (pledges).
Pawnbrokers make most of their profits from the interest differentials between the interests charged on the loans and the cost of the loan capital.
They are allowed to auction off unredeemed pledges. About 90 per cent of the pledges accepted by pawnbrokers are thus gold and jewellery.
In Singapore, the pawnbroking business was brought in by Chinese immigrants, particularly the Hakka community in the 19th century.
In the past, pawnshops were known as the ‘poor man’s banker’. The objects pawned ranged from household items such as irons, sewing machines and blankets to jewellery such as gold necklaces, bracelets, diamonds and watches.
Nowadays, pawners also include businessmen who need quick cash for their business and people who make use of pawnshops as their ‘safe deposit box’ while they travel overseas.
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