Welcome Message By Chairman Ganbold at the 2011 AGM Held on 24 May 2012, House 30, Ulaanbaatar, Mongolia

 

Dear Shareholders, 

A year has passed since our last AGM and it is time again to meet and gather for this important annual event. It is my privilege and honor to welcome you all to the joint Annual General Meeting of the Shareholders of TenGer Financial Group (“TFG” or the “Group”) and XacBank (the “Bank”) for 2011.     

In addition to our continued growth and accomplishments, 2011 was a special year for TenGer Financial Group. Exactly 10 years ago, our only investment at that time – XacBank – obtained a banking license and started its operations as a commercial bank with a focus on microfinance and facilitation of access to financial services for those who were not conventionally bankable. Today, XacBank has become our flagship - a bank of systemic influence and the 4th largest in the Mongolian banking sector. Over these years, our Group has grown itself beyond banking. We now represent a diverse financial services group with first ever in the country transnational investments and a portfolio of dynamic and growing companies in leasing, insurance, brokerage, banking IT and security.    

I would like, on behalf of the Board of Directors and personally, congratulate XacBank’s new Chief Executive Officer Bat-Ochir Dugersuren and his incredible team at the bank with their 10th anniversary and express sincere gratitude for their hard work and stellar efforts that resulted in an outstanding performance for the Financial Year 2011.  My special commendations and thanks go to Bat-Ochir for his excellent leadership and successful management of the Bank in the first year of tenure as CEO, continuously progressing on the key strategic directions set by our shareholders and the Board and advancing XacBank’s institutional milestones to more heights, hitting most of its major performance targets and maintaining competitive growth compared to the most established competitors of the banking sector. I would like also to congratulate and thank all senior management within the Group companies for their excellent leadership in 2011 and throughout all the years.    

I would like to extend my and the board’s sincere appreciations to all our shareholders for their continued support and commitment and to all the directors of the Board for their dedication and involvement.  

On this inspiring note, I am indeed very pleased to report that we closed another successful year with the Group’s consolidated assets reaching MNT 837.9 billion, an increase of 76.4 percent from the previous year, and total net profit reaching MNT 12.7 billion, an increase of 89.4 percent compared to a year earlier. The Group’s return on average equity was 20.3%, higher than 18.6% reported at the end of 2010. Our book value has reached MNT 6,097.23 per share, an increase of 42.8% over the reporting year.  

Despite major challenges posed by the external environment in the second half of 2011,  the total assets of the largest company in our Group – XacBank – reached MNT 818 billion, a 75% increase from 2010. Its net income amounted to MNT 12.1 billion, a 87% increase from 2010, and its ROE increased to over 20%. XacBank not only achieved its annual operational and financial targets but expanded further its market share, strengthened its competitive position, increased operational efficiency and improved its sales channels and network.  

XacLeasing was a no less success. Its total assets tripled from 2010, reaching MNT 18 billion and its net income amounted to MNT 393 million, a 63% increase from 2010.

TenGer Insurance deserved a special recognition. As you remember, the existence of this company was questioned not long ago. Today, TenGer Insurance is 4th largest insurance company with total assets of MNT 5.8 billion and net income of MNT 660 million, a 76% increase from 2010. Its ROE reached 35%.

In 2011, we had further expansions in our businesses. The Board of Directors and Shareholders of TenGer Financial Group made a landmark decision to establish and invest in TianRong Micro Credit Company located in the Xinjiang province of China to capitalize on the economic growth in China, relatively low penetration of financial services among SMEs in the Xinjiang province and substantial knowledge base of XacBank in microfinance. We anticipate that this new regional microfinance institution will be operational in 2012.    

Another newcomer is TenGer Capital, a brokerage company, where TenGer acquired a controlling 80 percent stake, that will serve the Mongolian citizens in allocating their “windfall” revenues and government cash handouts in mining stocks.  

The Group’s employee headcount reached 1,600 for the first time.

In 2011, we saw major Group-wide institutional developments in consolidated risk management, fund raising and capital markets, financial planning and management, legal compliance and corporate governance, human resource management and capacity building. A strong professional team was formed at the Group level to head each of these functions and provide consolidated management and coordination amongst the Group companies.    

We saw further enhancements in our corporate governance. We have in place a set of policies and procedures designed to increase transparency and disclosure, control over environment and processes. I am pleased to report that we have completed our Corporate Governance Action Plan, making significant improvements in our corporate governance practices, and are embarking now on the next stage of excellence in governance. 

We have strengthened further the board committees. In light of continued expansion and investments by the Group, a new investment committee functions at the Group Board’s level to review and provide recommendations on the investment proposals. The Group established a Group Risk Management committee with the aim of providing guidance and recommendations to subsidiaries on matters related to risk. The committee is composed of risk managers from key subsidiaries and chaired by TenGer.   

With consolidation of these major functions at the Group level, we strengthened simultaneously our internal control by bringing our Chief Internal Auditor at the Group level.

Our board continued to play its guiding and directing role. Jim Anderson, who had served since 2003, resigned as our director due to his relocation. Jim has played a vital role in our development and growth and I would like to thank him again for all the tremendous support that he has given the board and the management over all these years.    

Expansion and growth of systemic proportions bring not only recognition and financial benefits. Along with success, we accept immense responsibility, with little room for retreat, before our shareholders, customers, partners, employees and regulators. We have promising years and bright opportunities ahead of us. Astute strategic thinking, agility, creativity and courage will be required to outsmart competition and turn such opportunities into value for our shareholders, staying at the same time true to our fundamental mission of People, Planet and Profit. I am confident that we can build on our successes in 2012. We have diverse and balanced international shareholders, a wise and capable board and strong entrepreneurial management teams and brilliant young professional staff at all of our Group companies. More importantly, we have a culture of good governance and management that will underpin our strategy and growth agenda for the next decade.      

I would like to wish all of us a very productive and successful AGM.     

 

Thank you!        

By author: admin - Jun 06, 2012 / Categories: News