It saw last year's profit soar 52 per cent on 1991, a result made more remarkable by coming at a time when the ranks of DTCs are thinning, largely due to tougher ownership requirements imposed by the Commissioner of Banking.

''The higher profile which JCG got from listing in 1991 has had a positive impact on our business,'' Mr Leong said.

''We've seen growth in both the number of customers and in the average amount of loans, and we're actually getting better quality customers.'' JCG is targeting the 82 per cent of Hongkong's population - or 2.7 million residents, according to 1991 census statistics - who earn less than $10,000 a month from primary employment.

With 42,000 customers, growth prospects are good, Mr Leong believes.

As a deposit-taking company, JCG does not maintain inner reserves and so is a fairly good indicator of the state of consumer finance in Hongkong, analysts say.

Mr Leong acknowledged, however, that it would be difficult to sustain 1992's pace into 1993, and predicted a dip in profits growth to between 30 and 40 per cent.

However, he promised shareholders that 1993 would not see any dilution of earnings per share growth.

''We don't expect any big capital-raising exercises in 1993, so any growth in profits will translate directly into EPS growth,' he said.

Results for 1992 were well above expectations, with Sun Hung Kai Securities forecasting a 40 per cent increase in profits over 1991.

For the customer, convenience is the major attraction of JCG, with its extensive network of 32 branches and capacity to disburse loans within an hour's time.

While annualised interest rates are as high or higher than credit-card rates, most credit cards have a pre-set spending limit of double the cardholder's monthly salary, while a JCG borrower can take out a loan for up to six times his or her monthly wage.

''As people's income expands, they are more likely to use credit,'' said Mr Andy Kong of Sun Hung Kai Securities.

But unlike a fully licensed bank, which has a diversified portfolio, a DTC such as JCG depends heavily on the economic environment, which determines consumer buying confidence.

Personal loans and overdraft facilities comprise more than 80 per cent of the loan portfolio.

''The personal-loan business depends solely on economic conditions and people's expectations of future income,'' said Mr Kong, rating the stock as a long-term buy.

He predicts 1993 earnings growth dropping to 27 per cent, while Nomura Research Institute forecasts 35 per cent growth as a fall in consumer confidence hits discretionary spending and loan growth.

To date, JCG has emphasised loan growth rather than deposit growth, but Mr Leong said a campaign to boost deposits would be launched soon.

The company remains highly capitalised following its 1991 listing - which raised $128 million - with a 57 per cent capital adequacy ratio, well above the level required by the Commissioner of Banking.

Management expects to open branches at a rate of one to two a year, in combination with a strategy of relocating existing branches to better locations.

''It is not just a question of adding on more branches; positioning is key,'' said Mr Leong.

Last year four branches were relocated from office space to street-level.

A Wan Chai branch saw 70 per cent growth in business after moving half a block to a site at an intersection.

An advertising campaign was launched last year, mainly on Chinese-language commercial radio.

Less than four per cent of JCG's business was in residential mortgage lending, Mr Leong said, giving the company immunity from the predicted slowdown in profits for the banking sector, which is heavily reliant on mortgage lending.

Equally, a rise in interest rates - as is expected later this year - would have little impact, Mr Leong said, because JCG did not fund itself from the interbank market.

Mr Leong said funding sources were divided equally between shareholders' funds and deposits, although analysts suspect that some comes from the interbank market.

Parent Public Bank, Malaysia's third-largest listed bank and the largest non-government bank, has no plans to upgrade JCG into a fully licensed bank, according to Mr Lai Kim Leong, chief executive for the Hongkong region.

''We can do what we're doing quite well as a DTC,'' he said.

''Besides, we think it's better to be the biggest DTC than become a little bank.'' JCG, with total assets of more than $800 million, was ''on the lookout'' for an opportune acquisition, Mr Lai added.

But right now, banks in Hongkong were ''quite pricey'' so there was nothing in the pipeline at the moment.

Previously focused on the Malaysian market, Public Bank began expanding in the region in 1990, buying JCG Finance in the same year.