E.Sun Financial Holding Co (玉山金控) has set its sights on growing grow its core businesses twice as fast as its peers this year, after the company ranked among the nation’s top three enterprises in almost all growth indicator categories last year, senior executives said yesterday.
E.Sun Financial is targeting loan expansion of between 10 and 12 percent this year, compared with the previous year, when its outstanding loans rose 11.5 percent as the sector posted overall growth of 5.6 percent, chairman Gary Tseng (曾國烈) said.
“As we seek a quick rate of expansion in our core businesses, we will try to make sure that fee income increases faster than interest income,” Tseng said.
Interest income generated less than 50 percent of the company’s total profits last year due to intensive domestic competition, he added.
The strategy means that E.Sun Financial will have to enhance the quality of its services and deepen its relationship with customers, while focusing on higher-yielding products and services, Tseng said.
E.Sun Finacial’s net fee income totaled NT$9.05 billion (US$297.68 million) last year, rising 21.1 percent from a year ago thanks to strong wealth management and credit card businesses growing 37.9 percent and 13.1 percent respectively over the period, company data showed.
The financial group’s fee income constituted 34.1 percent of its after-tax profit last year at NT$8.46 billion, a proportion that is expected to increase by 15 to 20 percent this year, president Joseph Huang (黃男州) said.
Wealth management and credit card business will continue to be key drivers for the company this year, when they are forecast to increase by 20 percent and 15 percent respectively, Huang said.
Hong Hong-based Morgan Stanley analyst Lily Choi (蔡麗麗) said she expects E.Sun Financial’s robust earnings last year to extend into this year.
“We are positive about bank-focused conglomerates such as E.Sun as they stand to benefit from the improving macroenvironment,” Choi said in Taipei last week.
E.Sun Financial is also interested in pursuing mergers and acquisitions that will advance its goal of becoming a regional benchmark financial service provider, Tseng said.
E. Sun Financial shares closed down 1.04 percent to NT$19.1 yesterday, compared with the TAIEX’s 0.18 percent rise, Taiwan Stock Exchange data showed.