EnTie Commercial Bank (安泰銀行) yesterday said its asset quality and growth momentum remained resilient to macroeconomic headwinds, despite a surge in loan exposure last year.
The company reported that non-performing loans last year surged 144.34 percent to NT$1.79 billion (US$54.11 million), with the non-performing loan ratio rising to 0.98 percent from 0.38 percent.
At the same time, the bank’s loan loss provision coverage ratio tumbled to 149.33 percent m from 323.45 percent from a year earlier.
“The priority of a bank is to make a profit, and not just furnishing the required provisions and coverage ratios,” EnTie Commercial Bank chairman Jesse Ding (丁予康) told an investors’ conference.
Ding, who took over the chairmanship on Wednesday, said that the bank’s current loan exposure and coverage are acceptable by most standards seen across markets.
The bank still printed a total overall provisions to total loans ration of 1.46 percent, higher than the industry average of 1.3 percent, Ding added.
Last year, the bank’s asset quality, backed by its tier 1 ratio of 12.42 percent and a common equity tier 1 ratio of 11.73 percent, bested the industry average of 9.87 percent and 9.56 percent respectively.
Ding said the bank also achieved sector-leading performance metrics last year, including a pre-tax return on average equity of 16.47 percent and a return on average assets of 1.17 percent, compared with the industry’s 10.55 percent and 0.65 percent.
In particular, he pointed out the bank’s commitment to achieving strong cost discipline and efficiency that was reflected by a 43 percent cost-to-income ratio.
EnTie’s net income last year grew 28 percent annually to NT$3.29 billion, with earnings per share rising 2.6 percent to NT$1.96.
While the bank continues to striving toward a more even distribution from corporate and consumer lending, and between interest and fees income, Ding declined to comment on whether the bank is looking for sale in the market, saying that decision rests with the company’s major shareholders.
The Hong Kong-headquartered Longreach Group has held a 58 percent stake in EnTie for more than 7 years, longer than the typical investment period by private equity firms.
Ding said that he is confident Longreach Group has established an agreement with other major stakeholders to find a buyer for its 58 percent stake.
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