HFC Investment poised to ensure shareholder value

Accra, July 24, GNA - The Management of HFC Investment Services, a subsidiary of HFC Bank, said on Thursday that it would explore various investment opportunities to ensure that holders of the various instruments got good returns on them.

Mr Joseph Nketsiah, General Manager of the Company, told an Annual General Meeting of holders of the three investment schemes that management would continue the process of shifting away from more conservative instruments towards high yielding ones to improve the returns to clients.

The three funds are the HFC Equity Trust, a capital market fund, the HFC Unit Trust Money Market Collective Investment Scheme and the HFC Real Estate Investment Trust (REIT).

"We shall continue to select stocks that will earn good returns to our valued Unit holders and strive once again to give you good returns in the year 2008," he said.

Mr Nketsiah said 2008 held a lot of promise for investors in its REIT as the company intended to sell houses at Cantonments in Accra and also complete four-bedroom semi-detached houses at Community 25 in Tema by the close of the year.

He said with these developments, the expectation was that REIT Fund would achieve a remarkable growth in value and also a high yield and urged the investors to consider increasing their investment to take advantage of the growth.

The REIT last year sold houses at Tema and put up four-bedroom two-storey up-market houses at Cantonments. The Trust also sold its residential property in Kumasi and invested the proceeds in land acquisition at the AU village in Cantonments and plots at Community 25 at Tema. Mr Nketsiah said the cumulative effect of these transactions helped the Fund to achieve a yield of 17.5 per cent compared to 2.39 per cent the previous year. The Fund value also inched up from GH¢1.29 million in 2006 to GH¢1.4 million in 2007. On the performance of the HFC Unit Trust, Mr Nketsiah said the fund posted a yield of 12.75 per cent as at the end of December 2007 compared with 8.7 per cent for the same period last year. "This means, for instance, that a GH¢1,000.00 investment made in January 2007 would have become GH¢1,127.50 in December 2007, that is, generating interest earned of GH¢127.50," he said. He said this impressive performance in 2007 became possible through continuous investment shift towards higher yielding fixed income instruments.

Gross fund value grew by 13.8 per cent from GH¢13.1 million in December 2006 to GH¢14.9 million in December 2007 on account of additional investments made in the year by both existing and new clients who took advantage of the rising performance of the fund. Mr Nketsiah said the management would continue the re-adjustment in the portfolio structure to continue stability in returns and long-term growth of the fund.

On the HFC Equity Trust, a capital market fund, Mr Nketsiah said it closed the year at a yield of 34.19 per cent. The Trust net fund value also grew from GH¢529,393.86 to GH¢950,872.09, a jump of 79.62 per cent. "We expect the size of the HFC Equity Trust to double by close of year 2008. The manager would continue restructuring the investment portfolio to generate maximum returns for our Unit holders," he said. 24 July 08