Thu, Dec 23, 2010 - Page 12 News List

Far Eastern aims to increase profits by double digits

BOOST:Acquiring 19 branches from Chinfon Commercial Bank and a local credit card business raised FEIB’s scale, aiding operations and efficiency

By Crystal Hsu  /  Staff reporter

Far Eastern International Bank (FEIB, 遠東國際商銀) aims to increase net profit by double digits next year on growing interest and fee incomes amid a recovering economy, company executives said yesterday.

The lender, the banking arm of Far Eastern Group (遠東集團), which controls the nation’s largest textile company and has units in shipping, telecommunications and retailing, posted a net profit of NT$1.84 billion (US$60.12 million) as of September this year, more than double the amount in the same period last year, stock exchange data showed.

“We’re confident of double-digit growth in earnings ability next year” despite accounting rule changes that will require more provision of funds, president Eli Hong (洪信德) said at a media briefing.

Hong said acquisitions last year of 19 local branches from Chinfon Commercial Bank (慶豐銀行) and American International Group Ltd’s local credit card business helped expand FEIB’s scale, boosting operations and efficiency.

FEIB would consider more acquisitions when the opportunity arises, Hong said.

The company’s chief executive and vice president, Thomas Chou (周添財), said the bank’s net income may rise by between 10 percent and 20 percent next year, driven by improving wealth management, credit card and other core businesses.

Fees and interest incomes accounted for 27 percent and near 70 percent respectively of net income this year, Chou said. The bank also plans to issue US$200 million in euro-convertible bonds next year to meet rising demand for US currency, raise capital and prepare for more accounting rule changes, Chou said.

He declined to elaborate, saying the issuance needs approval from the Financial Supervisory Commission.

FEIB aims to lower its bad loan ratio to 0.5 percent next year, from 0.7 percent, and strengthen its coverage ratio to 200 percent, Chou said.

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