While the US credit crisis has dragged down financial markets worldwide, Shin Kong Financial Holding Co (
The nation's eighth-largest financial service provider by assets announced in a filing on Friday night that it would buy back 100 million common shares at a price of between NT$20 and NT$35, which is estimated to cost the company NT$2.53 billion (US$78.2 million) based on Friday's closing price of NT$25.25.
Shin Kong Financial said in the filing that its board approved the share purchase proposal, and the company would start buying back its shares on Monday for a period of two months.
The total planned purchase would account for 1.99 percent of its total shares issued and would not affect the company's capitalization, it said.
Shares brought back will be allocated for employee bonuses, it said.
The company announced the buyback plan after seeing its shares fall 9.83 percent since Wednesday, when it said it would have to take an impairment loss of NT$5 billion for the third quarter on investments in Cosmos Bank (
Following the writedowns, Shin Kong Financial reported a net loss of NT$1.86 billion in the third quarter.
For the first three quarters, the company's net income declined 15 percent year-on-year to NT$7.38 billion.
Shin Kong Financial joins an expanding list of financial service groups that have disclosed increased asset impairments from their exposure to CBO and collateralized debt obligation (CDO) investments due to the US subprime lending crisis.
The company said in a conference call on Wednesday that it had invested NT$10.6 billion in CDOs containing asset-backed securities (ABS) as of the end of the third quarter.
About NT$3.92 billion, or 37 percent, of such ABS CDOs were linked to US subprime mortgage products. The company claimed, however, that 60 percent of the securities were rated either "AA" or "AAA," and that interest/principal payments were normal.
Citigroup's equity research team, which has a 12-month target price of NT$45 for Shin Kong, said in a note released on Friday that the company offered attractive valuations, but downside risks remained given that "concerns on CDOs and CBOs will remain an overhang."
For the first 10 months of the year, Shin Kong Financial posted NT$8.213 billion in profit, or an earnings per share of NT$1.67, the company said in another filing on Friday.
Its insurance unit, Shin Kong Life Insurance Co (
Shin Kong Bank (新光銀行), meanwhile, posted a net loss of NT$1.295 billion, or a loss per share of NT$0.66, the filing showed.
Shares of Shin Kong Financial have declined 28.2 percent year to date, underperforming the benchmark TAIEX which has risen 13.3 percent.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the