Intense competition in the financial sector for suitable partners and market share is spurring many of the 13 government-licensed financial holding companies (FHCs) to accelerate their start-up plans. But one pundit predicted yesterday that only three to five of them will eventually survive after consolidation in the sector is realized.
"Within the next three to five years, we are expected to see another round of consolidation among FHCs since Taiwan's market will be again over-crowded with FHCs," said Wu Tsai-yi (吳再益), director of the economics department at Taiwan Research Institute.
Following Taiwan's WTO entry, it will be an inevitable trend for Taiwan's banking sector to "team up against international competitors via strategic alliances," he said.
The government has been encouraging and licensing banks to consolidate through mergers and acquisitions. The legislature recently fast-tracked passage of related FHC laws to facilitate the move. So far, shares of five newly founded FHCs, including Cathay (國泰金控), China Development (中華開發金控), Hua Nan (華南金控), Fubon (富邦金控) and E. Sun (玉山金控), have been traded on the local stock market, while shares of Taishin FHC (台新金控) and Chiao Tung Bank FHC (交通銀行金控) are about to begin trading next month.
Among them, Taishin yesterday revealed its management strategy to assure investor confidence in the new company's future prospects. Announcing plans to be listed on Feb. 18, Taishin International Bank Chairman Thomas Wu (吳東亮) yesterday said that he estimated that the merger between his bank and Dah An Commercial Bank (大安銀行) would create an earning per share of NT$1.6 by the end of this year.
With capital of NT$45 billion, Taishin is expected to provide one-stop financial services to over 3.5 million customers at its 133 branch offices, he said yesterday, adding that the consolidation would save an estimate NT$600 million to NT$700 million per year in costs within the next three years.
Praising the bank-turned-holding-company, Wu said that the new company's non-performing loan (NPL) ratio is expected to be reduced to 2.24 percent this year and have an after-tax income of nearly NT$5 billion.
The commercial bank currently has an NPL ratio of 3.62 percent, which is estimated to increase to 5.41 percent after the merger with Dah An Commercial Bank.
Nevertheless, employees at both institutions fear massive layoffs will soon occur.
"We have no plans to streamline the holding company," Wu said. "Retraining and relocating staff, though, will take place."
Taiwan Securities Co (
Shares of contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) came under pressure yesterday after a report that Apple Inc is looking to shift some orders from the Taiwanese company to Intel Corp. TSMC shares fell NT$55, or 2.4 percent, to close at NT$2,235 on the local main board, Taiwan Stock Exchange data showed. Despite the losses, TSMC is expected to continue to benefit from sound fundamentals, as it maintains a lead over its peers in high-end process development, analysts said. “The selling was a knee-jerk reaction to an Intel-Apple report over the weekend,” Mega International Investment Services Corp (兆豐國際投顧) analyst Alex Huang
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is expected to remain Apple Inc’s primary chip manufacturing partner despite reports that Apple could shift some orders to Intel Corp, industry experts said yesterday. The comments came after The Wall Street Journal reported on Friday that Apple and Intel had reached a preliminary agreement following more than a year of negotiations for Intel to manufacture some chips for Apple devices. Taiwan Institute of Economic Research (台灣經濟研究院) economist Arisa Liu (劉佩真) said TSMC’s advanced packaging technologies, including integrated fan-out and chip-on-wafer-on-substrate, remain critical to the performance of Apple’s A-series and M-series chips. She said Intel and Samsung
POWER BUILDUP: Powered by Nvidia’s B200 Blackwell chips, the data center would support MediaTek’s computing power demand and business growth, the company said Smartphone chip designer MediaTek Inc (聯發科) yesterday launched a new artificial intelligence (AI) data center with a maximum capacity of 45 megawatts to meet its rising demand for computing power required to develop new advanced chips for AI applications. The company has completed the first-phase computing power buildup at the data center in Miaoli County’s Tongluo Township (銅鑼), providing 15 megawatts of capacity to support its research and development (R&D) capabilities, despite an industrywide shortage of key components, MediaTek said. Supply constraints have plagued a wide range of key components, including memory chips, solid-state drives, power supply units and central
TRANSITION: With the closure, the company would reorganize its Taiwanese unit to a sales and service-focused model, Bridgestone said Bridgestone Corp yesterday announced it would cease manufacturing operations at its tire plant in Hsinchu County’s Hukou Township (湖口), affecting more than 500 workers. Bridgestone Taiwan Co (台灣普利司通) said in a statement that the decision was based on the Tokyo-based tire maker’s adjustments to its global operational strategy and long-term market development considerations. The Taiwanese unit would be reorganized as part of the closure, effective yesterday, and all related production activities would be concluded, the statement said. Under the plan, Bridgestone would continue to deepen its presence in the Taiwanese market, while transitioning to a sales and service-focused business model, it added. The Hsinchu
RSS