Investor Newsletter #3 - SePTEMBER 2010 

Welcome to our September 2010 General Finance quarterly 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.

Why We Need Finance Companies

Finance companies play a vital role in our economy. They are active in lending to smaller businesses - often to acquire plant and machinery, premises and so forth, enabling them to grow.  By far the majority of New Zealanders either owns a small business or works for one that employs twenty people or fewer. Lending to this sector assists both economic growth and the creation of employment opportunities. Finance companies create competition with the banks, which benefits both the investing and borrowing public. Finance companies have been, and will in the future be, at the forefront of developing new lending products such as some leasing type arrangements and investments such as monthly and quarterly income paying debentures. We must, for the success of this country, continue to have a finance company sector.

Finance Company Investments Are Part of a Diversified Portfolio

We constantly have market commentators saying investors must have a diversified portfolio. This not only applies to share portfolios but to fixed interest ones as well. A balanced fixed interest portfolio, we believe, should consist of bank deposits, corporate and government bonds and finance company deposits. Finance company deposits will often pay higher interest rates and the interest is paid more frequently (normally quarterly but sometimes monthly benefiting retired investors).  Often the duration (length of the investment) of finance company deposits at around two years is longer than say bank deposits but shorter than those of corporate and government bonds.

Our New Prospectus

All of our regular investors have now received a copy of our new prospectus. As part of our commitment to greater transparency and what we believe is the first for a New Zealand finance company, we have adopted on pages 15-19 the Australian disclosure requirements. These are more stringent than our New Zealand regulations and they include eight benchmarks that cover such things as levels of equity and liquidity. We believe this will give you greater assistance in reading our prospectus and comfort that we are taking the managing of our finance company and corporate governance seriously.

Interest rates

Interest rates have been edging up slowly over the past year. Just to remind our investors if you are looking at a rate above 8.0%, our two year rate is 8.25% and our three year rate is 9.25%. If you deposit more than $10,000 with us you can have your interest paid monthly. This is a great advantage for those wanting a monthly regular income.

Next Interest Payment

Our next quarterly interest payment will be made on the evening of Wednesday 30 September 2010. Direct credits will be processed that evening, with cheques (if applicable) and paperwork being forwarded during the week.

If you have any questions about your investment please do not hesitate to contact me on 09 526 7801 or by email to wcairns@general.co.nz.  Our website is at www.general.co.nz .

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 appreciated.