Chinatrust Financial Holding Co (中信金控), owner of the nation’s biggest credit card issuer, said yesterday it was mulling merger and acquisition opportunities with Chinese financial service providers to build a greater presence throughout the fast-growing Chinese market.
Paving the way for potential opportunities, Chinatrust’s board last month approved a proposal to extend the company’s capital to NT$150 billion (US$4.5 billion), up 50 percent from the current NT$100 billion.
“Potential investment opportunities in Chinese [banks], or vice versa, were factored in when we made the proposal,” company spokesman Daniel Wu (吳一揆) said at a press briefing yesterday. “We hope [an investment] would be a direct investment rather than made via a third destination.”
Chinatrust said it was still evaluating ways of raising new funds.
“If we decide to raise funds [by issuing new shares,] we would not rule out allowing Chinese companies to subscribe,” Wu said.
A number of Chinese banks, including financial heavyweights, have approached Chinatrust to buy a stake via investment banks, Wu said.
“We are optimistic and we will carefully study any investment [proposal] from Chinese banks,” he said.
Mergers and acquisitions are an important strategy for Chinatrust to rapidly build a stronger presence in China as it would take at least two years for its Chinese branches to get a license to help customers trade financial tools denominated in yuan, a business with big growth potential, Wu said.
Chinatrust, which has nearly 80 percent of its earnings from its bank subsidiary, Chinatrust Commercial Bank (中國信託商銀), is waiting for the governments on both sides of the Taiwan Strait to sign a memorandum of understanding (MOU) that would enhance financial cooperation and exchanges.
“We have been preparing to set up branches in China and we will immediately take action after the MOU is signed,” Wu said.
Chinatrust will be able to operate its Chinese units as early as next year if Taipei signs the MOU with Beijing by the end of next month as expected, he said. The procedure would take Chinatrust nine months, he added.
On April 30, Chinatrust reported NT$3.4 billion in net income for the first quarter, down 31 percent from NT$4.93 billion a year ago. However, that was more than double the NT$1.54 billion the company earned in the final quarter of last year.
Shares of Chinatrust jumped 6.76 percent to close at NT$19.75 yesterday, leading the gains in local financial stocks.
The benchmark TAIEX inched up 0.09 percent.
Quanta Computer Inc (廣達) chairman Barry Lam (林百里) is expected to share his views about the artificial intelligence (AI) industry’s prospects during his speech at the company’s 37th anniversary ceremony, as AI servers have become a new growth engine for the equipment manufacturing service provider. Lam’s speech is much anticipated, as Quanta has risen as one of the world’s major AI server suppliers. The company reported a 30 percent year-on-year growth in consolidated revenue to NT$1.41 trillion (US$43.35 billion) last year, thanks to fast-growing demand for servers, especially those with AI capabilities. The company told investors in November last year that
Taiwanese suppliers to Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) are expected to follow the contract chipmaker’s step to invest in the US, but their relocation may be seven to eight years away, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. When asked by opposition Chinese Nationalist Party (KMT) Legislator Niu Hsu-ting (牛煦庭) in the legislature about growing concerns that TSMC’s huge investments in the US will prompt its suppliers to follow suit, Kuo said based on the chipmaker’s current limited production volume, it is unlikely to lead its supply chain to go there for now. “Unless TSMC completes its planned six
Intel Corp has named Tasha Chuang (莊蓓瑜) to lead Intel Taiwan in a bid to reinforce relations between the company and its Taiwanese partners. The appointment of Chuang as general manager for Intel Taiwan takes effect on Thursday, the firm said in a statement yesterday. Chuang is to lead her team in Taiwan to pursue product development and sales growth in an effort to reinforce the company’s ties with its partners and clients, Intel said. Chuang was previously in charge of managing Intel’s ties with leading Taiwanese PC brand Asustek Computer Inc (華碩), which included helping Asustek strengthen its global businesses, the company
Power supply and electronic components maker Delta Electronics Inc (台達電) yesterday said second-quarter revenue is expected to surpass the first quarter, which rose 30 percent year-on-year to NT$118.92 billion (US$3.71 billion). Revenue this quarter is likely to grow, as US clients have front-loaded orders ahead of US President Donald Trump’s planned tariffs on Taiwanese goods, Delta chairman Ping Cheng (鄭平) said at an earnings conference in Taipei, referring to the 90-day pause in tariff implementation Trump announced on April 9. While situations in the third and fourth quarters remain unclear, “We will not halt our long-term deployments and do not plan to
RSS