Thu, Feb 24, 2011 - Page 12 News List

Chinatrust Financial plans private banking service

HOME AND ABROAD:President Daniel Wu said it would first target existing clients, before expanding services through its units in Hong Kong and Singapore next year

By Crystal Hsu  /  Staff reporter

Chinatrust Financial Holding Co (中信金控), the nation’s third-largest financial holding company by market share, plans to launch private banking business by the end of this year to better serve affluent customers, president Daniel Wu (吳一揆) said yesterday.

Wu said its wealth management department will first target existing clients, who have assets at home and abraod.

“We think it is time for Chinatrust Financial to join the market that is currently divided between foreign banks,” Wu said.

“We will seek to provide services on par with international rivals,” he said.

Toward that end, the bank-centric group will soon recruit relationship managers, Wu said. He declined to elaborate on the size or the threshhold of the private banking service.

“They are still under evaluation,” Wu said.

However, the group would extend its private banking business overseas next year through its units in Hong Kong and Singapore, since some customers own sizable assets abroad. Chinatrust Financial has operations in 14 countries, Wu said.

The company also aims to double revenue contribution from overseas operations to 30 percent in three to four years from the current 15 percent, Wu said.

Executive vice president Hsu Miao-chiu (許妙靜) said the group plans to add 100 financial consultants to its payroll, which will also see an overall increase although the company has yet to settle on the scale.

“All I can say is that of overall expense increases this year, 6 percent comes from personnel costs,” Hsu said.

Meanwhile, Chinatrust Financial expects its net profit to grow by double digits this year on widening interest spread and improving fee incomes, top executives said yesterday.

The group posted a net profit of NT$14.13 billion (US$477.95 million) last year, growing 4.8 times from NT$2.43 billion in 2009, thanks to an overall pickup in core businesses, company data showed. That figures translates into NT$1.32 earnings per share.

“We expect to see a continued good year in 2011 because the economy is forecast to expand between 4 percent and 5 percent,” which is favorable for the banking business, Wu told an investors conference.

Chinatrust Financial expects to see its net interest margin to climb to an average of 1.7 percent, from 1.55 percent last year, as Taiwan’s central bank is likely to raise interest rates by 12.5 basis points each quarter and may accelerate the pace if inflation risks loom larger, he said.

Net interest incomes totaled NT$24.68 billion last year, accounting for 47 percent of total earnings, the report showed.

Fee income contributed 49 percent at NT$25.56 billion, rising 12.7 percent from NT$22.68 billion a year earlier, the report said.

Chinatrust Commercial Bank (中信銀), the main source of income, generated NT$13.18 billion, or 93.26 percent, the report said.

Wu also said Chinatrust Financial remains interested in acquiring an insurance firm or creating its own since the bank’s existing network offers a ready bancassurance channel.

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