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Investor Newsletter #9 - March 2007

Welcome to our ninth General Finance quarterly investor newsletter.  We appreciate your support.  The purpose of this newsletter is to keep you informed about the company and various financial matters that may interest you. 

Housing Consents – Steady
Building consents for new residential dwellings for the past 12 months have remained steady. For the 12 months to January 2007, 1,880 consents were issued, compared with 1,900 for the same period the previous year. What is interesting with these figures is that building consents were down from 1,244 to 1,106 in the main centres (Auckland, Waikato, Wellington and Canterbury). It is the regional areas, particularly Otago, Nelson, West Coast, Manawatu and Wanganui, which have seen the largest increase in building consents up 78% from 180 to 321. Going forward, real estate commentators expect the current number of consents to slow.

Our Loan Portfolio
What does our loan portfolio look like? At 15 March 2007 the total assets of General Finance Limited stood at $9.3 million with $7.3 million being in mortgages and the remainder being our premises and cash assets. Our average mortgage size is $117,855 and all our mortgages are secured against residential properties. Our mortgage assets are divided between first mortgages (24%) and second mortgages (76%). Most of our mortgages are located in the greater Auckland area with the rest spread throughout the country. We do not lend on cars, chattels, commercial property, or residential apartment developments. Demand for short term bridging finance and second mortgages remains firm. We expect the next two weeks, before the end of the tax year, to be busy for us.

A Typical Loan
We have approval several loans where a borrower has found a property that they are keen to purchase, but they have not yet sold or have sold with a long settlement date. These types of transaction often occur in a firm property market, as people realise they must move quickly if they find a suitable property. This is classic bridging finance - typical terms range from a few days to 12 months.  We have been doing a number for relatively short terms - around 30 days. This is sound business for us, as banks are not keen on this type of lending due to its short term nature.

March Payment
Our next quarterly interest payment will be made on Friday evening, 30 March 2007.  Direct credits will go in that evening, with cheques (if applicable) and paperwork being forwarded the following week.  Shortly afterwards, statements for the 2006/07 financial year will be sent out.  

If you have any questions about your investment please do not hesitate to contact me on my direct dial, 09 526 7801.  Our website is at 

If you want to invest more funds or obtain statements and the like, our securities registrar’s number is 0800 500 602.  Your continued support is much appreciated.