Oi Wah announces 2016-2017 Annual Results

Net profit and revenue increases 13.0% and 15.3% respectively

Will consider initiating a buy back scheme of the Company's shares

Financial Highlights

HONG KONG, CHINA - Media OutReach - 25 May 2017 - The board of directors of Oi Wah Pawnshop Credit Holdings Limited (HKSE: 1319, the "Group" or "Oi Wah") announced its annual results and its financial position. For the year ended 28 February 2017 ("FY2017"), profit attributable to shareholders of the Company has increased by 13.0% and reached approximately HK$103.2 million (year ended 29 February 2016 ("FY2016"): approximately HK$91.4 million).

In FY2017, the Group recorded revenue of approximately HK$215.2 million (FY2016: approximately HK$186.7 million), representing an increase of approximately 15.3%. The increase was mainly due to the continuous expansion of our mortgage loan portfolio in FY2017.

During the year, earnings per share was HK4.9 cents (FY2016: HK4.4 cents). The Board of Directors recommends a final dividend of HK$0.69 cents.

Business Review

Mortgage loan business

For the year ended 28 February 2017, the mortgage loan business remained a major source of income of the Group. During the year, the interest income increased from approximately HK$125.6 million in FY2016 to HK$148.6 million in FY2017, representing an increase of 18.3%. Revenue generated from the mortgage loan business in FY2017 accounted for approximately 69.1% of the Group's total revenue during the year. The mortgage loan receivables increased from HK$890.8 million at 29 February 2016 to HK$1,151.1 million at 28 February 2017, representing an increase of 29.2%. During the year, there were 243 new cases of mortgage loan transactions.

The local property market has experienced a short-lived dip in early 2016 and then picked up again since the second quarter of 2016. Given the uncertainties of the global economy and US interest rate hike, the Directors are of the view that the Hong Kong property market remains unpredictable. In response to that, the Group will continue to implement a prudent strategy and maintain its focus on high net worth customers and remain cautious when granting mortgage loans. In FY 2017, the mortgage loan portfolio of the Group remains healthy. The loan-to-value ratio for first mortgage is around 51.3%,while the overall loan-to-value ratio for subordinate mortgage is around 56.0%, of which, loan-tovalueratio of subordinate mortgage that the Group participated in is around 18.8%.

Pawn Loan Business

During FY2017, pawn loan business remains steady and due to the gold price remained relatively stable, the revenue from the pawn loan business increased to HK$66.6 million. Average loan amount increased to approximately HK$6,200 per transaction (FY2016: HK$5,700 per transaction). The aggregate loan amount slightly decreased by 0.9% to HK$590.4 million (FY2016: HK$595.7 million), which is mainly due to the closure of one of our pawnshops in December 2015.

During the year, the Group continued to channel resources to advertising and promotion to enhance the Group's brand awareness. Such effort has generated demand of one-to-one pawn loan appointment services for pawn loans that exceed HK$0.1 million. Number of pawn loan transactions with such amount granted increased from 354 transactions in FY2016 to 490 transactions in FY2017.

Prospects

Looking forward, the group will actively diversify its collaterals to other luxurious items, such as automobiles and yachts. It is believed that the loan demand will remain strong in Hong Kong, and the Group will continue to expand its business to maximize shareholders' return.

It is expected that the Group's pawn loan business and mortgage loan business will maintain a healthy growth. The Group will continue to seize business opportunities for large amount loans, and engage in syndicated loan business with other lenders, in order to satisfy customers' needs, broaden income sources and customer base as well as diversify risks. Meanwhile, the Group's credit management remains cautious and prudent.

In addition, the Group will continue to raise funds through lower-cost financing channels such as issuance of bonds and borrowings from overseas banks, with a view to maintain sufficient capital reserve to meet the customers' requirements for loans and capture the opportunity to expand its market share in the industry. With the prevailing market conditions and the current share price of the Group, the Directors are also considering initiating a buy back scheme of the Company's shares.

Mr. Edward Chan, Chairman and CEO of the Company, said, "During the year, pawn loan business and mortgage loan business of the Group has continued to achieve satisfactory and healthy growth. We will continue to seize opportunities and strive to create the best interests for our shareholders and the Company. "

About Oi Wah Pawnshop Credit Holdings Limited

Oi Wah is a financing service provider in Hong Kong, mainly providing short-term secured financing, including pawn loans and mortgage loans. The Group established its first pawnshop in 1975 and currently owns 11 pawnshops in various locations in Hong Kong. Oi Wah diversified into mortgage loan business in 2009. The Group is the first local pawn shop which successfully listed on the Main Board of The Stock Exchange of Hong Kong Limited on 12 March 2013.