INFINI T E
PP 16123/11/2009(022723)
Vol 1 • NOVEMBER • 2008
OR
IZON
H
S
HSBC - inspiring business success
Special!
Chinese section
China's economy after
the Olympics
Forex risk can erode
corporate earnings
SEIZING
OPPORTUNITY
The journey of a
SELF MADE MAN
Collaboration at Islamic Forum
Obtaining Financing
Datuk David Yeat Sew Chuong
Group CEO, INS Group of Companies
HSBC z global update
NEW ZEALAND: Small business, big voice
The New Zealand Government has created
a plethora of agencies and programmes to
promote small business enterprise, but it fails to
consult properly when introducing legislation
and regulations - and that in turn effectively
inhibits doing business and adds more operating
costs, reports BNET.com.
That is one of the most emphatic conclusions
to come from the inaugural Small Business
Summit in Auckland in August 2008.
Organised by the Independent Business
Foundation, a ginger group for small and
medium enterprises (SMEs), the summit brought
together participants from the SME, corporate,
academic and government sectors.
The report said the summit drew up a 'wishlist'
of key priorities and recommendations for
circulation to politicians across party lines,
government agencies and SME advisers. Entitled
"Small Business - The Key to Tomorrow", the
'wishlist' focused on the need to develop specific
SME policies in order to create an environment in
which SMEs can succeed.
The large number of central and local
government agencies offering intervention
programmes to SMEs came in for particular
criticism. These create confusion and
administrative waste rather than opportunity,
and they are invariably inadequately marketed
so businesses do not know how to access
them.— BNET.com
US: America's Best Young Entrepreneurs 2008
International business magazine, BusinessWeek,
has started its search for the moguls of
tomorrow in its quest for America's Best Young
Entrepreneurs.
The search covers entrepreneurs who are 25and-under.
In a release in September, the magazine
outlined some of its finalists: Richard Ludlow,
22, turned down a job offer from McKinsey and
deferred admission to Harvard Business School
to start New York's Academic Earth, an online
hub for videos of university lectures and other
educational content.
Backed by angel funding, he aims both to earn
a profit and to improve society—by making
academic material widely available online so
as to lower the cost of education around the
world.
In between homework and basketball practice,
high school senior Jasmine Lawrence, 17, landed
deals with Wal-Mart and Whole Foods to carry
her line of natural cosmetics. Lawrence started
Eden Body Works in Williamstown, N.J., to offer
alternatives to chemical products after a bad
experience with a hair relaxer. — BusinessWeek
ASIA: Making the world more business-friendly
As Asia becomes the top destination for many
businesses, the East Asia and Asia Pacific, have
been rated as among the most entrepreneur-
2008 NOVEMBER z infinite horizons z friendly regulatory environments with the likes
of Singapore, Hong Kong, Thailand, Malaysia,
and South Korea ranked in the top 50 countries
with the best environment to do business.
As the 10-member Asean grouping starts
to compete with the likes of China and India
for foreign direct investment, the regulatory
environment in Asean countries has become far
better than those in China and India, according
to the World Bank, reports Bangkok Post.
Among the Asean countries, Thailand
ranked second (and 13th worldwide), followed
by Malaysia (20th globally). Brunei was in
88th place, Vietnam 92nd, Indonesia 129th,
Cambodia 135th, the Philippines 140th place
and Laos 165th place. — Bangkok Post
US: Stimulus package for entrepreneurs
There are four constituencies to be taken into
account when crafting an entrepreneurshipfriendly tax policy: entrepreneurs, angel
investors, venture capital firms and
corporations.
"My very strong recommendation to
entrepreneurs is to learn the tricks of
bootstrapped entrepreneurship so that
they can keep maximum control over their
destiny," writes Sramana Mitra, a technology
entrepreneur and strategy consultant in Silicon
Valley in a column in Forbes Magazine.
Mitra adds that the recommendation assumes
that entrepreneurs would be putting their
04 • COVER STORY
The journey of a self made man
07-10
• chinese section
SMEs get RM1.2 billion aid from
government
savings into their ventures.
"Thus, we need a tax policy that makes it as
attractive as possible for entrepreneurs to "invest"
in their own ventures, especially at the early
stages," she said.
An aspiring entrepreneur, she says, ought to be
allowed to create a tax-free pool of income for
use as personal venture capital. Such a pool of
capital would go a long way to help kick-start new
ventures. — Forbes Magazine
US Entrepreneur goes green with clean tech firm
The current "going green" craze is pushing
some people to move out of the suburbs, buy
more expensive hybrid cars, or give up their cars
altogether.
But this demand for lower carbon footprints is
pushing entrepreneurs to develop ways to reduce
emissions without altering one's whole lifestyle,
blogs US News reporter Matt Bandyk.
Out of Livingston County, Mich., comes
entrepreneur Kyle Schwulst, whose company
ElectroJet fits motorcycles with a special fuel
injection system that reduces carbon emissions.
His company has been so successful that
Schwulst traveled to Beijing to fit police and
medical motorcycles there with his system, and
manufacturers seem to be jumping on board, to
the tune of a projected $500 million in sales for
ElectroJet. So pretty soon you might not have to
feel bad about buying that motorcycle, a vehicle
that tends to be emission-heavy. — US News
China's economy after the Olympics
Forex risk can erode corporate
earnings
SMEs need strategies to do business with MNCs
CONTENTs
Publisher HSBC Bank Malaysia Berhad (Company No. 127776-V) Editorial Team Habhajan Singh, Ho Wah
Foon, Nesa Sivagnanam, Bong Swee Lin, Mohd Zulkarnain, June Ko, Ismail Che Rus Editorial management
The Malaysian Reserve, Suite 4.02, 4th floor, Dataran Hamodal, Block B, Jalan Bersatu, 13/4, 46200 Petaling
Jaya, Selangor Printer Vinlin Press Sdn Bhd, No.2 Jalan Meranti Permai 1, Meranti Permai Industrial Park, Batu
15, 46100 Puchong, Selangor.
© Copyright. HSBC Bank Malaysia Berhad (Company No. 127776-V) 2008. All rights reserved.
This publication is for private circulation to selected customers of HSBC Bank Malaysia Berhad (“HSBC”),
and may not be redistributed, reproduced, copied or published, in whole or in part, for any purpose.
This publication is solely for general information and does not constitute any advice, recommendation
or offer by HSBC. The opinions, statements and information contained in this publication are based on
available data believed to be reliable. HSBC does not warrant the accuracy, completeness or fairness
of such opinions, statements and information and no reliance thereon shall give rise to any claim
whatsoever against HSBC.
04
The journey of a self made man
11
Malaysian Islamic Forum
14
12
Teaming Up at Smidex 2008
11-12 • beyond business
Malaysian Islamic Forum (MIF) 2008
Banking Industry Seminar for SMEs by ABM
Teaming up at SMIDEX 2008
HSBC - Best International Trade Bank
HSBC tops survey of world's leading banks
13 • beyond business
SME Breakfast Series
14 -15 • quick tips
Obtaining financing from a commercial bank
Seizing the opportunity
13
Message from
Mr Eddie Norton,
Managing Director
Commercial Banking
HSBC Bank Malaysia Berhad.
SMEs are important contributors to the sustained growth and resilience of
our economy and a very important sector for HBSC Malaysia. In fact,
businesses like yours account for more than 90% of our customer base. That's
why we believe it is important to communicate with you and as such, it gives
me great pleasure to introduce the first edition of INFINITE HORIZONS.
We appreciate that the current uncertain economic situation with volatile
commodity and raw material prices may be affecting many of you and we
therefore hope that the articles in this magazine will offer you insights
and tips that can benefit your business as well as demonstrate how HSBC can
assist you in building a successful business whether you trade domestically,
or indeed are looking to expand overseas.
As Malaysia External Trade Development Corporation (Matrade) Chief Executive
Officer Datuk Noharuddin Nordin recently said, "It is important that SMEs...
promote their brands to world markets and create niches to enhance market
share. They must learn to position their products in emerging markets."
The SME Annual Report 2007, launched earlier in July, highlighted that SMEs
should seek new opportunities within the region and other emerging markets
such as China, India, South America and the Middle East.
HSBC's local knowledge combined with our extensive international network
enables us to provide unparalleled expertise and value-added support to your
business, especially in these challenging times.
So whether you are seeking new markets or wondering how you can make your
working capital work harder, my colleagues and I would be happy to discuss
how we can help.
I hope you enjoy reading INFINITE HORIZONS.
Eddie Norton
2008 NOVEMBER z infinite horizons z HSBC z cover story
Datuk David Yeat Sew
Chuong started working
when he was just 16.
Through sheer hard work
and a keen sense of what
the market wanted, he is
today the CEO of the INS
Group of Companies,
which he founded.
The Journey Of
A Self Made Man
By Ishun P Ahmad
B
orn into a poor family, entrepreneur Datuk
David Yeat Sew Chuong made his money
through sheer hard work and a keen sense
of what the market wanted.
"I have worked 12 hours a day for the last 20
years. Nothing can be achieved via a short cut. We
must be in the know and ever conscious of what
we are doing. We must remain focused at all times,"
he told Infinite Horizons in a recent interview.
Apart from hard work, Yeat also attributes his
success to his keen sense of what consumers
need. "This ability also enables me to easily catch
up with consumer needs," he adds.
Business Of The Future
Yeat started work when he was 16 years old
selling dairy consumer products door-to-door.
Backed by 12 years of experience, Yeat decided
to venture into his own business and founded
the INS Group of Companies. He is currently the
2008 NOVEMBER z infinite horizons z group's Chief Executive Officer (CEO).
INS Holdings Bhd, the investment and holding
company for the group, was established in
June 1996 with the aim of inventing, and
manufacturing innovative healthcare products
using in-depth bioscience technology. These
products would then be marketed and distributed
to help improve the community's quality of life.
INS Bioscience Bhd, a member of the group, is
Nothing can be achieved
via a short cut. We must
be in the know and ever
conscious of what we are
doing. We must remain
focused at all times.
listed on the Mesdaq Market of Bursa Malaysia.
INS Group was founded to capitalise on the
strong business potential of healthcare products
that incorporate bioscience technology. This is
where Yeat's awareness of the ever changing
business environment came into play. Early on, he
sensed the changing landscape around him. Here
lies the "business of the future," he predicted back
then. At that moment, a hunch told him that the
growth potential was enormous.
"I realised that for me to go into business, I
needed to go into the business of the future.
This will ensure that we have the opportunity to
become market leaders. I strongly believed in this
type of business where the growth potential is
very good," says Yeat.
Making His Move
With the sheer determination to succeed, Yeat
went on the prowl in search of funds. He managed
cover z story
to raise business capital to the tune of RM300,000
from private funds.
In the years to come, he kept working at
growing his enterprise. At this critical juncture, he
had a number of things going for him. For one,
he had already established a good rapport with a
number of global suppliers.
This hugely aided him when he faced critical
business issues. Another factor that worked in his
favour was the good relationship forged with his
banker, HSBC Bank Malaysia Bhd. The combination
of solid networking with suppliers and having the
support of his bankers allowed him to take his
business forward.
The good relationship, he said had also helped
to boost investor confidence in the group. He
cited, as an example, Malaysia Venture Capital
Management Bhd (MAVCAP) and a number of
other fund managers who have invested in his
company.
Yeat said his business started with a biotech
liquid fertiliser product, during a time when palm
oil fetched high returns. As a group, INS has bigger
plans. On the drawing board are plans to list this
part of its business by year-end.
Easy Pha-Max Int Sdn
Bhd Chief Executive
Officer Datuk S C Yeat
Investing For Future
Moving forward, Yeat said the group has
invested a lot in advertisements and branding
in its quest to become a leader and information
provider for herbal products that incorporate
bioscience technology.
Yeat said Easy Pha-Max International Sdn Bhd,
a member of INS Bioscience, has spent RM10
million this year for this purpose and budgeted
another RM10 million for next year. Now, that is a
handsome sum for an enterprise of its size.
According to Yeat, the Easy Pha-Max business
model is unique compared to other multi level
marketing (MLMs) rivals. Easy Pha-Max uses an
e-commerce business model, positioning itself as
an efficient marketing and information provider to
sell its products.
The company has heavily invested in a dedicated
e-commerce portal for this purpose, thereby
allowing consumers to use it to find information
on a wide variety of herbs.
Unlike online giant Ebay that matches
consumers to consumers, Yeat said that the Easy
Pha-Max portal matches businesses to consumers.
This, he says, allows for the more competitive
pricing of its products.
"Ebay is consumer-to-consumer, Google is
an information provider. For me, Easy Pha-Max
provides a complete package. If a competitor
is looking at this market, it will be difficult as I
control all of the global herbal information. Our
search engine has herbal plant information from
more than a 100 countries," he says.
In addition, Yeat and his team have devised
2008 NOVEMBER z infinite horizons z cover z story
a business model that also offers products for
sale through franchise outlets. This is especially
helpful to consumers who want to physically see
the product before making a purchase. Again, this
reflects Yeat's detailed knowledge of the needs of
consumers.
On plans for the future, Easy Pha-Max plans to
have some 60 outlets in 2009. At this juncture,
they have already received more than 40
applications to set up outlets. Currently, there are
two outlets, one each in Puchong and Penang.
Easy Pha-Max also has overseas outlets in Asian
countries such as China (10 outlets), Hong
Kong (2 outlets) and one each in Singapore, the
Philippines and Los Angeles, USA.
"We want to bring this model to the Asian
market. It will be wonderful if I can be a market
leader in the next 10 years. The potential in the
Asian market for these products is tremendous.
Asia is the largest market and Easy Pha-Max will
focus on countries like Japan and Korea that have
large populations," says Yeat.
Sharing some details on the cost, Yeat says the
initial investment to open an
outlet is about RM300,000
with an expected break even
period of two years.
The company, he adds, has
also spent a large amount of
money to develop a number
of other healthcare products
that have been enhanced
with bioscience technology
through collaboration with a
number of universities.
"Bioscience technology's
advantage is its low R&D cost.
Apart from this, the usage
of bioscience technology to
enhance healthcare products
is also very efficient on the back of cost and returns
as the quality of the healthcare product is improved
significantly. For instance, we can still competitively
price our enhanced biotech products to the nonenhanced healthcare products," he adds.
The potential is huge. The market is vast. The
team is ready. Yeat and members of the INS Group
are keenly aware of all these facts. In the years
to come, they intend to harness their expertise
and resources to become the undisputed
market leader in delivering enhanced bioscience
healthcare solutions.
I realised that for me to go
into business, I needed to
go into the business of the
future. This will ensure
that we have the
opportunity to become
market leaders.
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Issued by HSBC Bank Malaysia Berhad (Company No. 127776-V)
2008 NOVEMBER z infinite horizons z 2008 NOVEMBER z infinite horizons z 2008 NOVEMBER z infinite horizons z 2008 NOVEMBER z infinite horizons z 2008 NOVEMBER z infinite horizons z 10
HSBC z beyond BUSINESS
COLLABORATION AT THE
MALAYSIAN ISLAMIC FORUM
H
SBC BANK MALAYSIA BHD recently
teamed up with HSBC Amanah Takaful
(Malaysia) Sdn Bhd (HSBC Amanah
Takaful) as financial sponsors to
support the Malaysian Islamic Forum (MIF) 2008.
The two-day event which ended on Aug 12 was
held at the Mandarin Oriental, Kuala Lumpur.
HSBC Bank Malaysia and HSBC Amanah
Takaful have both supported this international
conference separately, in 2006 and 2007.
However this year, the two HSBC entities came
together to combine their strengths and efforts
to contribute towards the success of MIF 2008, as
part of HSBC's commitment to the development
of the Islamic finance industry.
"This sponsorship reflects HSBC's dedication in
working towards improving the Islamic finance
industry by developing alternative solutions
not only for its clients but for the market at
large," says Musa Abdul Malek, Acting Managing
Director of HSBC Amanah, HSBC Bank Malaysia.
Musa, who has been with HSBC for more than
29 years and has experience in the Debt Capital
Market, was one of the panelists at the annual
forum. He spoke on "Malaysian Capital Markets
and the Global Financial Systems".
Mohammad Muqeem, Chief Executive
Officer of HSBC Amanah Takaful noted that the
congregation of great minds at the MIF 2008
allowed for collaboration to improve existing
products and services thus making Shariahcompliant products more marketable.
Muqeem, who has 29 years of experience in
the insurance and takaful industry, shared his
thoughts on the "Development of the Takaful
Industry and Investment-Linked Products". HSBC
has been offering Islamic financial solutions in
Malaysia since 1994.
Globally, the HSBC Amanah brand was
established in 1998, with the aim of making HSBC
the leading provider of Islamic banking services
worldwide. In August 2006, HSBC Amanah Takaful
commenced operations and after only 18 months
in business, it became the first Islamic insurance
company to be rated by an international agency
(Fitch Ratings), receiving a rating of A- as capped
by the sovereign rating in Malaysia.
Recently, HSBC Bank Malaysia became the first
locally incorporated foreign bank in Malaysia to
be awarded a licence to set up an Islamic Banking
subsidiary by Bank Negara Malaysia.
BANKING INDUSTRY
SEMINAR FOR SMEs
Peter Cheah (inset), the bank's Director of SME, Insurance & Investment, delivered a presentation at the SME seminar
H
SBC BANK MALAYSIA BHD was
present at the inaugural SME seminar
organised by The Association of Banks
in Malaysia (ABM).
Peter Cheah, the bank's Director of SME, Insurance
& Investment, delivered a presentation at the event
attended by some 500 fee-paying participants on
July 9.
Bank Negara Malaysia (BNM) Governor Tan Sri Dr
Zeti Akhtar Aziz presented the keynote address at
the seminar intended to enhance SME awareness
and access to financing.
"ABM and our member banks recognise that the
development of a strong and dynamic SME sector
is important to the national agenda in the creation
of a sustainable and balanced economy", said Wong
Suan Lye, the Executive Director of ABM.
The association, formed in November 1973, aims
to establish and promote a sound banking system
in Malaysia in cooperation and consultation with
the central bank.
2008 NOVEMBER z infinite horizons z 11
HSBC z beyond BUSINESS
TEAMING UP AT SMIDEX 2008
SMIDEX 2008, an avenue for Malaysian
SMEs to network and market their parts
and components, saw some 300 companies
making use of the event to connect with
fellow SMEs and larger companies. These
companies represented various clusters such
as information and communication technology
(ICT), manufacturing, logistics, the services
sectors and technology development.
Special emphasis was given this year to
packaging technologies and design. Trade
visitors, especially SMEs, saw first hand the
latest packaging machines and technologies
applied in their business processes.
"Of special significance is the fact that these
machines and equipment are specially tailored
to the needs of SMEs," said Malaysia's Minister
of International Trade and Industry Tan Sri
Muhyiddin Yassin in his speech during the
event which was officially declared open by
Prime Minister Datuk Seri Abdullah Ahmad
Badawi.
The three-day event which began on June 4
was the eleventh annual exhibition organised
by Small and Medium Industries Development
Corporation (SMIDEC), now re-designated as
the Small and Medium Enterprises Central
Coordinating Agency.
In his opening speech, Abdullah said the
National SME Development Council, which
he chairs, approved the change and agreed
that the entity be named SME Corporation
Malaysia or SME Corp. To be fully operational
on Jan 2, SME Corp would formulate policies
and strategies as well as coordinate SME
programmes across all sectors, covering
18 ministries and 60 agencies. SMEs, which
account for 99.2% of business establishments,
are considered the backbone of the Malaysian
economy.
"Recognising the importance of SMEs,
the Government provided RM3.7 billion in
financial assistance in 2007 to implement SME
programmes focusing on building capacity
and capability, human capital development,
technology and innovation, as well as
marketing and promotion," said Muhyiddin.
Since March 2007, SMIDEC has begun to
disburse grants to SMEs using the Electronic
Fund Transfer. As at May 2008, 1,777 payments
had been made, with funds worth RM115.1
million transferred electronically. Through
this initiative, SMEs are able to receive their
grants within three days of approval of their
BEST INTERNATIONAL TRADE BANK
HSBC Bank Malaysia Bhd has been named, for the first time ever, as the Best
International Trade Bank in Malaysia in Trade Finance's Awards for
Excellence 2008 for outstanding performance in 2007. Trade Finance is the
well-recognised global magazine for supply chain, commodity and export
finance and part of the prestigious Euromoney Group of Publications.
"This win reflects our team's commitment in consistently anticipating our
customers' needs, in structuring and then delivering optimal Trade and Supply
chain solutions," said Vivek Gupta, Director Trade and Supply Chain, HSBC
Bank Malaysia Bhd.
"This achievement truly reflects HSBC's commitment in delivering the best
service to our valuable clients with the efficiency, flexibility and
convenience needed to conduct business globally," Gupta added.
2008 NOVEMBER z infinite horizons z 12
applications.
HSBC Bank Malaysia's Commercial Banking
sector also participated in the event to share its
wealth of global expertise and local knowledge
with local SME market players.
Bank Negara Malaysia, the nation's central
bank, was the co-organiser of SMIDEX 2008
which carried the theme "Strategic Partnerships:
Regional Link, Global Reach".
The event was held at the Kuala Lumpur
Convention Centre.
HSBC TOPS SURVEY OF WORLD'S
LEADING BANKS
HSBC has jumped from third to first place in the latest annual Banker
magazine survey of the world's top one thousand banks (Top 10001).
HSBC is the first non-US company to lead the survey since 1999 and tops
the rankings by virtue of its Tier 1 capital and profit before tax, which last
year reached a new high. The survey found that US banks now account for
just 14% of the aggregate Top 1000 pre-tax profits, down from 24% last
year, while Asian banks rose to 19% from 12%. European bank profits
remained flat at 41% of the total. In April, HSBC also topped the Forbes
2000 list of the world's largest companies — the first non-US company to
do so, having delivered a 26% growth in annual revenue and a 31%
growth in net income over the past five years.
HSBC z beyond BUSINESS
THE SME BREAKFAST SERIES 2008
Managing banking transactions can assist SMEs in improving
productivity and profit.
This was one of the tips outlined at a recent SME Breakfast Series 2008 meet
organised by HSBC Bank Malaysia Bhd.
Now, how do you go about getting this done? Jason Tan, Director of Global
Payments and Cash Management at HSBC Bank Malaysia Bhd, shared some
insights in his presentation entitled 'Managing banking transactions for improved
productivity and profit' at the event on June 27.
Jason's presentation touched on the use of electronic payments, internet
banking and the prevalent use of cash and cheques in the market. "Determining
your business payment strategy is both an art and a science.
It is an art in negotiating with your suppliers for the best payment terms and a
science in choosing the best method to pay," he said.
Apart from the main topic discussed, Malaysia's Country Consultant for Google
Inc Han-Son Toh shared his knowledge and insight in using the internet for
business.
Other partners included Malaysia SME and Pathlab.
The guests, mostly business owners and SME decision makers from the Klang
Valley, arrived at the MATRADE Exhibition & Convention Centre in Kuala
Lumpur to start the day with breakfast and engage in networking.
2008 NOVEMBER z infinite horizons z 13
HSBC z quick tips
OBTAINING FINANCING
FROM A COMMERCIAL BANK
Helping businesses understand what banks
are generally looking for when lending money
W
orking capital is one impetus for
entrepreneurs to turn to bank
financing. How do you ensure that
your enterprise successfully gains
access to the much-needed financing?
Entrepreneurs know the importance of doing
their homework and the need to arm themselves
with a solid business plan.
Doing Your Homework
Not all banks are the same and there is a range
of financing options structured especially
for small and medium businesses. The
Malaysian Government also supports SMEs
through a comprehensive set of programmes
encompassing soft loans, grants and guarantee
schemes through the various ministries and
agencies.
There is an excellent one-stop SME Portal
managed by Bank Negara Malaysia (www.
smeinfo.com.my) that provides information on all
aspects of SME development, including financing,
advisory services, training programmes, business
and networking opportunities as well as other
SME developmental programmes/initiatives by
the Government and private sector.
Business Plan
As you may be aware, you will need to submit a
written Business Planto the bank, outlining your
vision/objectives and how the business is to be
managed to achieve this. If you are not confident
of being able to articulate your vision in a written
format, engage a financial consultant. However,
there are some internet sites that offer guidance
on writing Business Plans for the purposes of
2008 NOVEMBER z infinite horizons z 14
getting a loan.
Here are some quick tips on the main items that
your Business Plan should contain:1. Background & History — It is always
important to give the bank a sense of
background and history of your business.
2. Business Model & Products — Bankers
need to understand what your business does to
make the necessary credit assessment. You must
provide details on what your business does and if
possible, attach pictures or samples.
3. Directors and Management Profile — Banks
want to know who is running the business
and what experience the management team
brings. Don't forget that for most SMEs, the main
shareholder/director is expected to provide a
personal guarantee on business loans to ensure
a personal commitment to the business and its
success.
4. Business Cycle — To reduce credit, fraud
and money-laundering risks as well as other
compliance-related issues, banks are coming
under increasing pressure to understand their
customers better in terms of who your business
buys from and who you sell to and on what
terms. With this additional information, a bank
also may be able to provide you additional
financing options that you had not originally
considered.
5. Industry, Competitors and Business
Strategy — When the bank asks you about
competitors, it is seeking comfort that you
understand the industry in which you operate,
the competitive environment and have a clear
strategy to succeed. If you are unable to tell
the bank what are the Strengths, Weaknesses,
Opportunities and Threats ("SWOT") for your
business, then that loan is unlikely to be
approved.
6. Financials — Provide audited accounts of
your business for the last three years. Audited
accounts are a quick way of checking the health
of your business and the lack of updated audited
accounts are considered an early warning signal
of financial stress. You should also provide at least
one year's future projections to the bank.
7. Standard Supporting Documents — Most
banks would ask the SME to enclose the
following standard documentation:• Memorandum & Articles of Association (M&A) or
Business Registration and Business Licences
• Form 9, Form 24 and Form 49
• Bank statements and loan statements for the
last 12 months
• Details on any collateral offered (eg fixed
deposit/property/personal and corporate
guarantees)
Conclusion
Should you get a rejection letter despite having
done all of the above, seek an explanation from
the bank as to why the business loan was rejected.
For entrepreneurs with access to new capital, may
you steer your enterprise to a better path.
HSBC z quick tips
SEIZING
OPPORTUNITY
S
ecuring for your business a Letter of Credit (LC) promptly
and without any hassle is a dream for most entrepreneurs.
When an opportunity beckons, the business instinct in
the entrepreneur demands that he or she gets into action
immediately.
In business, HSBC recognises that it is important to seize
opportunities fast. You may be planning to purchase goods and
services from a supplier abroad or perhaps you want to take
advantage of an attractive import opportunity. With SpeedyLC,
you can meet your urgent payment obligations via a LC without
having to establish credit facilities with HSBC. What's more, you can
get your LC issued within 24 hours on the next banking day at the
place of issuance once all the pre-requisites are fulfilled.
With SpeedyLC, you can also leverage on our global reach. The LC
can be routed directly to your supplier through HSBC's network
of 9,500 offices in 85 countries and territories worldwide.
An LC is an instrument or document issued by a bank guaranteeing the payment of a
customer's drafts up to a stated amount for a specified period. It substitutes the bank's credit for the
buyer's and eliminates the seller's risk — BARON'S DICTIONARY OF FINANCE AND INVESTMENT TERMS
Benefits of SpeedyLC:
Quick LC Issuance within 24 hours of submission of all required documentation and satisfactory completion of required
Customer Due Diligence.
Full cash margin means no need for credit facility for issuance of SpeedyLC.
Easily accessed via 40 branches in Malaysia
Plus! Free instant receipt of your LC and Trade Service advices via email with our Instant@dvice Services
IS YOUR BANK
KEEPING UP
WITH YOUR BUSINESS?
At HSBC, we know how critical time is. That is
why we have designed a payment solution that
keeps up with the speed of your business.
Get your Letter of Credit in 24 hours.
Commercial Banking
www.hsbc.com.my/commercial
1-800-88-3898
Issued by HSBC Bank Malaysia Berhad (Company No. 127776-V). Terms and conditions apply.
2008 NOVEMBER z infinite horizons z 15
2008 NOVEMBER z infinite horizons z 16