Promise to Return to Profit

Promise Co. is easily Japan’s third largest maker of consumer and auto loans. However, the company has just had its first full year loss since they went public more than ten years ago. They say that they believe that they will return to profit this year.

With a decline in lending that all auto loan issuers have felt lately, they say that they are taking steps to ensure that they do not have another loss next year. They are following in the steps of many other auto loan and consumer loan centers and cutting back where necessary.

The company has announced that they will be cutting jobs, closing outlets as well as reducing loan approvals. They ended up with a large chunk of their losses last year being due to consumer and auto loans that turned out to be bad loans.

They are planning on cutting roughly 40 billion yen from their operating budget over the next three years. They will be eliminating 1,000 jobs as well as closing 225 of their outlets. They have set up a new firm to handle auto loans starting in July, which will help with their diversification.

They also just paid about 3 billion yen for Car Conveni Club Co, which will offer auto repairs, auto loans, as well as other services. The company is also looking to open an internet shopping mall, and with profits from that should help with their bottom line.

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