Citigroup Taiwan, which reported record high profits last year, expects earnings to continue to rise, growing at a double-digit rate this year, the company said yesterday.
The company posted a record NT$10.32 billion (US$317.6 million) in pre-tax profits last year, up 6.57 percent from the previous year, a record high in its 41 years in Taiwan.
Citigroup's NT$10.32 billion profits accounted for more than half of the NT$20.08 billion of total earnings generated by the 36 foreign banks in Taiwan last year.
"We saw significant growth in our consumer, corporate and investment banking business units last year, and we hope to retain double-digit growth momentum this year," Citigroup Taiwan's country officer Morris Li (利明獻) said during a press conference yesterday.
The banking giant will work hard to reach the goal amid a difficult macro-environment, where the firm sees a slew of risks, including spiraling consumer bad debt, lackluster economic growth, decelerating export growth, an increasing number of Taiwanese companies moving offshore and an overly crowded banking sector, the senior banker said.
Even so, Citibank is seeking to acquire rivals in a bid to further expand the scale of its credit card business.
"The market will see a huge reshuffle this year. We are very interested in taking over competitors that are planning to quit the market and will not miss any acquisition opportunities," said Victor Kuan (
Kuan however declined to elaborate on any ongoing talks and possible targets, citing business confidentiality.
Citibank is the nation's seventh largest credit card issuer, with 1.74 million cards in circulation.
According to figures from the Banking Bureau, a total of 45.49 million cards were in circulation as of the end of December.
The consumer bad debt problem has not yet peaked, in light of the relatively small number of cases resolved under the government's credit debt negotiation mechanism and uncertainty over future amendments to the Bankruptcy Law (
It is still too early to predict when the issue will ease, he said, adding that it usually takes about 15 months to 18 months based on the experience of other countries that have suffered consumer credit crises, such as Hong Kong and South Korea.
Despite the bumpy road ahead for the consumer banking segment, the outlook for Citibank's investment banking unit appears promising, on expectations for industry consolidation.
"We expect to see ... robust merger and acquisition [M&A] activities globally this year" said Du Ying-tsong (
There is also a need for consolidation this year in several industries in Taiwan, including the finance, thin-film-transistor liquid-crystal-display, electronics manufacturing services and components sectors, Du said.
Foreign private equity funds will play a key role in the nation's M&A deals this year in light of cheap funding costs given to the nation's low interest rates, Du said.
Citigroup Global Markets Inc advised on BenQ Corp's (
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to