Fubon Life Insurance Co (富邦人壽) aims to raise its investment in foreign and domestic stocks by 1 to 2 percentage points, which might translate into an additional NT$50 billion (US$1.59 billion), on the back of a steady global economic rebound.
The investment assets of the life insurance unit of Fubon Financial Holding Co (富邦金控) totaled NT$2.588 trillion as at the end of last year, with a stock investment of 17.3 percent, according to a company report released yesterday.
“We plan to raise the stock investment proportion by 1 to 2 percentage points this year,” Fubon Life senior vice president Raymond Lin (林立民) told reporters after a quarterly investors’ conference.
Lin said the life insurer plans to focus on investing in stocks with high yields to maintain the momentum of its net interest income, with longer-dated bonds to be considered as investments as well.
Fubon Financial topped its local peers’ profitability for the first two months of this year, posting net income of NT$15.45 billion, or earnings per share of NT$1.51, up 48 percent year-on-year, according to the firm’s financial data.
Fubon Life generated NT$11.29 billion in net income in the first two months of the year, an increase of 132 percent year-on-year, the data showed.
The insurance unit saw unrealized gains of its financial assets available for sale rebound to NT$57.7 billion, as the firm worked to balance its investments between stocks and bonds, Lin said.
The insurer’s unrealized gains could have continued to rise in the first quarter because of its increased equity position, he added.
Last year, Fubon Financial posted net income of NT$60.19 billion, or earnings per share of NT$5.88.
Both represented record-high levels in the company’s history and could allow the company to raise its dividend payout to shareholders this year, Fubon Financial president Vivien Hsu (許婉美) said.
However, the exact amount of the dividend is to be finalized by the company’s board at the end of the second quarter, Hsu said.
Last year, the company distributed a cash dividend of NT$1.5 per share.
The profitability of Fubon Bank (China) Co Ltd (富邦華一銀行), which was included in Fubon Financial’s annual report for the first time last year as a Chinese banking subsidiary, was one of the major sources of growth for the company.
The bank is targeting 10 percent growth in net income this year, following a plan to raise its total number of branches to 20 by the end of the year.
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