Sat, Aug 03, 2013 - Page 14 News List

Capital Security earnings grow

PROFIT DRIVERS:The company expects its equity trading, financial derivatives and underwriting business to lift its earnings this year, attributing it to a growing economy

By Crystal Hsu  /  Staff reporter

Capital Securities Corp (群益金鼎證券), the nation’s fourth-largest brokerage house by market share, expects an uptick in earnings for the rest of the year, despite lingering downside risks, company chairman Alex Wang (王濬智) said yesterday.

The flagship company of the Capital Group — which also includes Capital Futures Corp (群益期貨) and Capital Insurance Agency Corp (群益保代) — posted a net income of NT$558.08 million, or earnings per share (EPS) of NT$0.24, in the first half of the year, information on its Web site showed.

“Earnings in July were 5 percent higher than the average of the first six months and we expect the improvement to extend into the rest of the year,” Wang told a media briefing ahead of the release of earnings results later this month.

He attributed his optimism to a recovering economy at home and abroad, while the government is seeking to make financial markets more friendly to investors and introducing stimulus measures to boost consumer confidence.

The announcement of stimulus measures is positive to market sentiment whether or not they can achieve the intended effect, as is the case with Japan’s promise of economic reform, Wang said.

For that reason, Capital Securities may see stronger profit figures this year, compared with last year when the company recorded a net income of NT$1.05 billion, or EPS of NT$0.44, the chairman said.

Equity trading, financial derivatives and underwriting will drive the firm’s earnings growth, Wang said.

Like some of its Taiwanese peers, Capital Securities is in talks with prospective partners to jointly tap the fast-growing securities market in China, he said.

Wang declined to elaborate on the company’s plans as the Legislative Yuan is still reviewing a cross-strait service trade pact and China has not announced details about its liberalization plan.

Taipei and Beijing had earlier reached a consensus on allowing Taiwanese securities houses to own 49 percent of joint ventures in China’s economic pilot zones and 51 percent in special zones.

“All I can say is that we intend to join hands with Chinese firms in finance-related industries,” the chairman said.

Capital Futures is more aggressive about expansions overseas.

The company has worked out plans to buy a 20 percent stake in China’s Cinda Futures Co (信達期貨) and may ink an agreement after the service trade pact clears the legislature, Capital Futures chairman Tim Sun (孫天山) said.

The futures company also plans to open a branch in Singapore in a year and a branch in Chicago in three years as overseas operations turn in Capital Securities shares closed up 0.2 percent at NT$9.98 yesterday, underperforming the TAIEX, which advanced 0.54 percent, Taiwan Stock Exchange data showed.

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