Fri, Feb 01, 2013 - Page 13 News List

Taiwan Cooperative to tackle loss-making units

By Crystal Hsu  /  Staff reporter

State-run Taiwan Cooperative Financial Holding Co (合庫金控) aims to bring its loss-making subsidiaries into the black or break even this year as the macro-environment grows more positive, company chairman Leon Shen (沈臨龍) said yesterday.

The nation’s fourth-largest financial service provider by assets posted NT$7.56 billion (US$255.7 million) in net income last year, ranking 10th among 15 of its listed peers, with earnings of NT$1.07 per share, company data showed.

“Taiwan Cooperative Financial saw mixed results last year,” Shen said.

The government controls a 30 percent stake in the conglomerate that owns the largest banking network and currently has 290 branches, down from 300 last year. The group is taking steps to boost financial proficiency and ease the overcrowded banking market.

The group will close branches in remote locations, Shen said, declining to elaborate to avoid upsetting employees.

The group’s banking arm, Taiwan Cooperative Bank (合作金庫銀行), underpinned the group’s earnings almost single-handedly with NT$7.54 billion in net profit last year, accounting for 99.74 percent, company statistics showed.

The securities, life insurance and asset management units reported losses attributable mainly to market volatility for the brokerage sector that should resume profitability this year amid improving risk appetite, Shen said.

Its life insurer and fund house, both joint ventures with French banking group BNP Paribas, continued to struggle to break even after their creation in April 2010 and June 2011 respectively, Shen said.

Taiwan Cooperative Financial is looking to deepen cooperation with BNP, particularly to take advantage of it’s wealth-management strength, Shen said.

Taiwan Cooperative Bank president Tsai Chiu-jung (蔡秋榮) expects interest margins to stay flat this year from an average of 1.22 percent last year as global central banks are likely to maintain eased monetary policies.

The bank will not pursue loan growth this year, but will seek to improve earnings by adjusting its loan books, Tsai said.

This story has been viewed 987 times.
TOP top