CTBC Financial Holding Co (中信金控) is seeking merger and acquisition (M&A) opportunities to expand the scale of its life insurance arm, and company executives have not ruled out the possibility of acquiring Taiwan Life Insurance Co (台灣人壽), the company said.
The bank-focused conglomerate made the remarks before its quarterly investors’ conference yesterday in Taipei, at which CTBC reported net income last year of NT$39.44 billion (US$1.25 billion) last year, or NT$2.58 per share, a record-high for the company.
Last year, the financial holding firm’s banking unit, CTBC Bank Co Ltd (中國信託銀行), remained its major source of income — posting a net profit of NT$34.26 billion — and its life insurance arm, CTBC Life Insurance Co Ltd (中國信託人壽), saw annual net income growth of 271.6 percent to NT$1.58 billion, CTBC Financial said in a statement.
Photo: Lee Ching-hui, Taipei Times
“The company is always seeking to expand the scale and assets of its life insurance business,” CTBC Financial president Daniel Wu (吳一揆) said at a news conference.
Wu refused to elaborate on the details of the possible deal with Taiwan Life, saying that the two companies have signed a non-disclosure agreement.
Last year, Taiwan Life shareholders turned down an M&A proposal submitted by the management of Taiwan Life that would have seen a merger with CTBC Financial. However, last month Taiwan Life’s major shareholder re launched the bid expressing high interest in cooperating with CTBC Financial.
In addition, Wu said he hopes CTBC Life’s plan to buy a 20 percent stake in its Chinese peer, ABC Life Insurance (農銀人壽), would be completed in the first half of the year, allowing the Taiwanese firm to tap China’s huge life insurance market.
In terms of its banking business, Wu said the financial holding company would continue its overseas expansion this year,with plans to open offices in Malaysia, Myanmar and Australia.
Following its acquisition of Japan’s Tokyo Star Bank Ltd last year, CTBC Financial plans to strengthen the Japanese regional bank by introducing more overseas syndicated loan projects, Wu said.
CTBC Financial reported net income of NT$6.1 billion in the first two months of the year, or NT$0.4 per share, up 13 percent from the same period last year, higher than the average growth of 2.7 percent for banks and bank-centric financial holding companies according to statistics compiled by the Taiwan Stock Exchange.
This year, the company is mulling a pay raise for its employees of between 3 and 5 percent, amid optimism about Taiwan’s economy, Wu said.
With the US economy recovering and Taiwan’s job market picking up, Taiwan’s GDP growth might reach 3.8 percent this year, he said.
CTBC Financial shares fell 0.24 percent to NT$20.4 yesterday in Taipei trading. they have declined 0.49 percent this year, Taiwan Stock Exchange data showed.
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