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 (
With an approval rating of just two percent, Peruvian President Dina Boluarte might be the world’s most unpopular leader, according to pollsters. Protests greeted her rise to power 29 months ago, and have marked her entire term — joined by assorted scandals, investigations, controversies and a surge in gang violence. The 63-year-old is the target of a dozen probes, including for her alleged failure to declare gifts of luxury jewels and watches, a scandal inevitably dubbed “Rolexgate.” She is also under the microscope for a two-week undeclared absence for nose surgery — which she insists was medical, not cosmetic — and is
CAUTIOUS RECOVERY: While the manufacturing sector returned to growth amid the US-China trade truce, firms remain wary as uncertainty clouds the outlook, the CIER said The local manufacturing sector returned to expansion last month, as the official purchasing managers’ index (PMI) rose 2.1 points to 51.0, driven by a temporary easing in US-China trade tensions, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The PMI gauges the health of the manufacturing industry, with readings above 50 indicating expansion and those below 50 signaling contraction. “Firms are not as pessimistic as they were in April, but they remain far from optimistic,” CIER president Lien Hsien-ming (連賢明) said at a news conference. The full impact of US tariff decisions is unlikely to become clear until later this month
GROWING CONCERN: Some senior Trump administration officials opposed the UAE expansion over fears that another TSMC project could jeopardize its US investment Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is evaluating building an advanced production facility in the United Arab Emirates (UAE) and has discussed the possibility with officials in US President Donald Trump’s administration, people familiar with the matter said, in a potentially major bet on the Middle East that would only come to fruition with Washington’s approval. The company has had multiple meetings in the past few months with US Special Envoy to the Middle East Steve Witkoff and officials from MGX, an influential investment vehicle overseen by the UAE president’s brother, the people said. The conversations are a continuation of talks that
CHIP DUTIES: TSMC said it voiced its concerns to Washington about tariffs, telling the US commerce department that it wants ‘fair treatment’ to protect its competitiveness Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reiterated robust business prospects for this year as strong artificial intelligence (AI) chip demand from Nvidia Corp and other customers would absorb the impacts of US tariffs. “The impact of tariffs would be indirect, as the custom tax is the importers’ responsibility, not the exporters,” TSMC chairman and chief executive officer C.C. Wei (魏哲家) said at the chipmaker’s annual shareholders’ meeting in Hsinchu City. TSMC’s business could be affected if people become reluctant to buy electronics due to inflated prices, Wei said. In addition, the chipmaker has voiced its concern to the US Department of Commerce
RSS