The second policy change is the increased government pressure to restrict the activities of private, high interest underground lenders, many of whom have charged SMEs 50 percent interest or more. This excessive interest rate, said Mr. Qin, has caused many SMEs to fail and has produced severe inflationary pressures throughout the economy.
Lastly, the government has also taken steps to curtail off-balance sheet "back-door" bank loans to SMEs. These steps will likely continue, said Mr. Qin, driving further loan business into the microcredit sector.
Due to the above factors, Mr. Qin said he expected CCC could experience "improved revenue and profit growth" over last year's results beginning in the fourth quarter of this year.
For the last 12 months through March 31, 2013, China Commercial Credit had a profit of $8.3 million on approximately $12 million in interest and fee revenue. Since inception, CCC has delivered net revenue and pre-tax income with compound annual growth rates of 22% and 34%, respectively. This rapid growth, said Mr. Qin, is a "strong indication" of China's financial support for SMEs.
"It is an honor to be the first Chinese microcredit company to go public and list on a U.S. national exchange," concluded Mr. Qin. "I deeply appreciate the interest that investors are showing in one of China's lesser known but superior growth industries. I am excited about the future of microfinance in general and CCC specifically, and I look forward to communicating our progress to shareholders on a regular basis."
About China Commercial Credit
China Commercial Credit (http://www.chinacommercialcredit.com), founded in 2008, provides business loans and loan guarantee services to more than 360 small-to-medium enterprises (SMEs), farmers and individuals in China's Jiangsu Province. Due to recent legislation and banking reform in China, these SMEs, farmers and individuals - which historically had been excluded from borrowing funds from State-owned and commercial banks -- are now able to borrow money at competitive rates from microfinance lenders.
Investors wishing to receive CCC's corporate communications as they become available may go to http://www.ir-site.com/china-commercial-credit/default.asp and register under Email Alerts.
This press release contains forward-looking statements within the meaning of federal securities laws. You should not rely upon forward-looking statements as predictions of future events. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this release to conform these statements to actual results or to changes in our expectations. You should review the factors described in the section entitled "Risk Factors" in our prospectus filed with the SEC on August 14, 2013 and other documents we file from time to time with the SEC. We qualify all of our forward-looking statements by these cautionary statements.
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