Tue, Aug 27, 2013 - Page 13 News List

E. Sun plans expansion in Cambodia

BURMESE DAYS:E. Sun Financial is also eyeing the Myanmar market after setting up a representative office in Yangon last month, which it is looking to upgrade into a branch

By Crystal Hsu  /  Staff reporter

E. Sun Financial Holding Co (玉山金控) plans to formally expand into Cambodia as well as partner with a local firm in tapping the third-party payment market in Taiwan, senior executives said yesterday.

“We will host a banquet on Sept. 10 to announce our presence in Cambodia” after authorities approved the company’s purchase of a 70 percent stake in Phnom Penh-based Union Commercial Bank PLC (UCB) for US$69.33 million, E. Sun Financial president Joseph Huang (黃男州) told a media briefing.

UCB, with its five branches, will allow the bank-focused Taiwanese conglomerate a foothold to explore the 10-member ASEAN markets that will see greater integration in 2015, Huang said.

For a country like Cambodia with economic growth of 7 percent to 8 percent a year, financial institutes could aim for business growth two to three times as fast, Huang said.

The pace of growth may not translate into equal earnings contribution in the first year due to technology, personnel and other infrastructure investment expenditures, but may bear fruit in the second year, Huang said.

UCB generated US$5.1 million in net profit last year, up 13.84 percent from US$4.48 million in 2011 and five times the earnings of US$1 million in 2010, Huang said.

E. Sun Financial will handpick the UCB chief executive and control two-thirds of seats in its board room, he said.

Main subsidiary E. Sun Commercial Bank (玉山銀行) will seek to strengthen the Cambodian lender’s wealth management, mortgage and credit card businesses, but will not change its title, as it commands good name recognition as the eighth-largest bank in Cambodia, Huang said.

E. Sun Financial is also eyeing Myanmar after setting up a representative office in Yangon last month, which it is looking to upgrade into a branch in the future, Huang said.

E. Sun Bank will also soon apply for China’s approval to operate yuan business for its existing branch in Dongguan and establish its second Chinese branch in Shanghai, he said.

In Taiwan, E. Sun Financial has struck an agreement with a heavyweight local firm to jointly offer third-party payment services for online shopping, starting early next month, he said.

Huang declined to supply more information about the partner except that e-commerce may not be a major earnings driver, but may turn into a multi-billion dollar industry in a few years given the rapidly growing prevalence of on-line business transactions.

“E. Sun Bank aims to be the No. 1 player in e-commerce among peers,” Huang said.

To finance business expansions, E. Sun Financial will issue subordinate debts valued at NT$2.7 billion (US$90 million) on Wednesday last week and look for regulatory permission to issue another NT$5 billion worth of debts in the first quarter of next year, Huang said.

Shares in E. Sun Financial closed down 1.63 percent to NT$18.1 yesterday, compared with the TAIEX’s 0.28 percent rise, Taiwan Stock Exchange data showed.

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