Taishin's profits exceed expectations

Taishin Financial Holding Co (台新金控), the nation's seventh-largest financial service provider in terms of total assets, yesterday reported better-than-expected profits in the first three quarters of this year.

Net income for the first nine months of the year rose to NT$8.73 billion, up from NT$5.91 billion in the first half, with earnings per share (EPS) at NT$2.19. The figure met 87 percent of its full-year profit goal of NT$10 billion.

"Despite a family squabble [surrounding its chairman Thomas Wu (吳東亮)], Taishin Financial's management team strived to do a good job in profit-making," the company's president, Julius Chen (陳淮舟), told a press conference yesterday.

The company vowed to maintain 20 percent to 30 percent annual profit growth in the future, he added.

Among its subsidiaries, Taishin International Bank (台新銀行) and Taishin Bills Finance Corp (台新票卷) outperformed other units in the third quarter, achieving respectively 92 percent and 97 percent of their full-year profit targets, said chief financial officer Carol Lai (賴昭吟).

Taishin Financial's net interest margin (NIM), however, declined to 4.97 percent from 5.04 percent in the previous quarter, Lai said, citing stiff price competition in the consumer banking market.

NIM is the gross margin for financial institutions, representing the difference between interest income and interest expense, divided by average earning assets.

Lai said the company's NIM figure may not climb soon, leveling around 4.9 percent in the next quarter as a result of heavy price pressures.

"Despite a slimmer margin, [we] hope to maintain 20 percent loan growth to profit," she said.

As of the end of last month, the company saw 19.4 percent loan growth from one year earlier, including a 10.8 percent growth in corporate loans and a 23.7 percent growth in consumer loans.

Still, the financial-service company's securities unit -- Taiwan Securities Co (台証證券) -- still faces challenges in the fourth quarter due to the sluggish stock market.

"The stock market is stymied by electoral uncertainties, both with the US' presidential election and Taiwan's legislative elections, rising oil prices and the interest-rate hike in China," Taiwan Securities president Lin Keh-hsiao (林克孝) said.

Separately, Fubon Financial Holding Co (富邦金控), the nation's fifth-largest financial services provider by assets, yesterday also reported NT$12.4 billion in net profits for the past nine months, meeting 77 percent of its full-year profit goal.

Although Fubon had NT$1.67 earnings per share (EPS) in the third quarter, the company saw a 4-percent decline in net profit growth compared to the same period last year, the company said in a statement.

Profits from Fubon Financial's two banking units -- Fubon Bank (富邦銀行) and TaipeiBank (台北銀行) -- decreased as a result of recent interest-rate fluctuations, but are expected to upturn next year when the merger is officially completed.

Fubon's securities unit and life-insurance unit both showed rosy performance with respectively a 40 percent and 25 percent growth in net profits compared to the same nine months last year, the statement said.