Interview with the Chairperson Independent Director & Chairperson Aisha Timol How would you evaluate CFSL’s overall performance this past year? I am pleased to report that CFSL has had an admirable performance in FY 2023, despite the challenges posed by the external environment. While adhering to prudent financial principles and sound risk management practices, we remained steadfast in growing our core areas of expertise, which traditionally have been consumer finance and leasing. We continued to provide support to our customers and partners, reaffirming our role as a dependable and meaningful partner in their growth; and we undertook an important strategic investment that has enabled us to gain a firm foothold in Africa, marking a significant step in our regional expansion plans. With our digitalisation drive and environmental ambitions also gaining momentum, we emerged from the past year with a strong sense of accomplishment and a clear path towards making sustainable finance a reality. As always, I remain in admiration of the commitment and resourcefulness displayed by our talented team, who never cease to exceed our expectations. Could you shed some light on the market conditions that impacted CFSL? What measures did the Group take in response to these circumstances? The external market environment was undeniably volatile and riddled with challenges. As a non-banking financial institution, we rely on a strong capital base, borrowings and debt instruments to fund our activities and extend credit to customers. The prevailing high-interest rate environment took a toll on our financing costs, and by extension, on our net interest margins. Elevated inflation is also affecting the way consumers and businesses plan their finances, stretching the capacity of borrowers to repay their debts, and eroding the purchasing power of lower-income households. In the face of these adversities, we reassessed our lending practices, credit scoreboard and loan portfolio at the level of the Group’s Risk Management Committee to protect the Company against the risk of non-payment. Were there any noteworthy strategic developments during the year? Indeed, the year was shaped by positive strategic developments. The acquisition of a controlling stake in Loinette Capital Limited (‘Loinette Capital’) marked a momentous milestone in our regional expansion journey and diversification strategy. Loinette Capital is a well-established specialist in asset-based financing, with a clear goal to support SMEs across East, Central and West Sub-Saharan Africa. Above all, this enables CFSL to extend the impact of its mission - to uplift lives and build better futures - to a broader audience across Pan-Africa. Another noteworthy initiative was the introduction of the Noubiznes Booster Programme, through which we lend targeted support to SMEs to improve their odds of success, even in the face of economic downturns and volatility. What value was delivered to the Group’s shareholders? Our strong financial performance enabled us to deliver enhanced returns to our esteemed shareholders in appreciation of their loyalty and support. We declared a final dividend of MUR 0.38, up from MUR 0.24 in 2022, reflecting our commitment to creating long-term value for our shareholders. Without question, this is a testament to the passion and professionalism of our people, who form the backbone of our success. I am sincerely grateful for the hard work and contributions of our employees. As the world finds itself in the midst of a war for talent, CFSL is wholly committed to nurturing and retaining its team members. How have CFSL’s governance practices evolved over the past year? Were any changes made to the Board to enhance its effectiveness and stewardship role? Good governance and a responsible business culture play a vital role in driving positive outcomes for all our stakeholder groups, from our shareholders, customers and employees, to our communities and the environment. As overseers of risk and stewards of long-term value, we recognise that the ownership of this mission lies firmly with our Board of Directors. ESG matters have gained more prominence at Board level, and we have made encouraging progress in establishing the structures, processes and control systems needed to cascade down an ESG-focused mindset throughout the entire organisation. 16 CIM FINANCE ANNUAL REPORT
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