Taishin Financial Holding Co (台新金控) said yesterday it would continue efforts, including acquisitions, to diversify its product lines after securing a deal to buy the local unit of New York Life Insurance Co, allowing it access to the local life insurance market.
Taishin Financial president Joseph Jao (饒世湛) inked an agreement with Gary Benett, the US insurer’s chief executive in Asia, in Taipei to acquire 100 percent of its local unit for NT$100 million (US$3.3 million).
EARNINGS DRIVER
The bank-centric Taiwanese company has sought for years to buy a life insurer to boost its economies of scale and overall earnings, as its banking arm, Taishin International Bank (台新銀行), ranks third or fourth in the nation in terms of bancassurance sales.
“We will seek next to strengthen our product lines and services, and will embark on favorable campaigns to advance the goal,” Taishin Financial spokesman Welch Lin (林維俊) said.
With 98 branches nationwide, Taishin Bank is the nation’s third-largest credit card issuer. The lender will maintain an open platform, Lin said.
Taishin Financial would seek to gain a better understanding of New York Life Taiwan before deciding whether it should adjust its business strategy or product lines, he added.
The group also needs to demonstrate its professional competence by putting together a management team to win approval from the Financial Supervisory Commission for the acquisition, Lin said.
“The group has drawn up a list of candidates, but prefers to keep it from the public for now,” he said.
With NT$40 billion in cash on hand, Taishin Financial does not need to raise capital for the buyout, Lin said.
Taiwan Ratings Corp (中華信評), the local arm of Standard & Poor’s, said its ratings on Taishin Financial remain unchanged, given the local insurer’s small size.
“In our view, the acquisition is likely to have a limited impact on Taishin Financial’s credit profile, as New York Life Taiwan accounts for less than 3 percent of the group’s net worth as of the end of last year,” the ratings agency said in a statement.
LEVERAGE
Credit Suisse disagreed, saying the acquisition would raise Taishin Financial’s double-leverage ratio, creating pressure for a capital injection next year.
“While the deal size is small, it has large implications for the group’s capital adequacy, such as double-leverage ratio,” the foreign brokerage said in a note. “The pressure will heighten if Taishin Financial needs to inject capital into the life unit next year.”
Credit Suisse cut its ratings on Taishin Financial to neutral from overweight and lowered its target price on the stock to NT$12 from NT$14.2, the note said.
Taishin Financial shares fell 0.4 percent to NT$11.30 yesterday.
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
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day