First Financial Holdings Co (第一金控) yesterday said the loan default caused by Ching Fu Shipbuilding Co (慶富造船) might affect year-end bonuses for its employees, while other state-run banks said the default would not have much of an effect on their bonuses.
Top executives at state-run financial institutions made the assessment at a meeting of the legislature’s Finance Committee on fallout from the Ching Fu case.
First Commercial Bank (第一銀行), the banking arm of First Financial, has yet to settle losses linked to the default and is unable to set a figure for bonuses, acting chairwoman Grace Jeng (鄭美玲) said.
As the lead bank for the troubled syndicated loan of NT$20.5 billion (US$679.75 million), First Commercial Bank would incur the biggest losses, which are estimated at NT$3.5 billion, Jeng said, adding that bonus payouts have averaged 4.6 months of regular pay in the past few years.
The Ministry of Finance, the largest shareholder of state-run financial institutions, said it would appoint a new chairperson at First Financial in three months, after dismissing former chairman Joseph Tsai (蔡慶年) earlier this month.
State-owned Bank of Taiwan (臺灣銀行) and Land Bank of Taiwan (土地銀行) said they would distribute year-end bonuses equivalent to 4.4 months of pay, while Hua Nan Commercial Bank (華南銀行) said it aimed for 4.6 months.
Taiwan Cooperative Bank (合庫銀行), Taiwan Business Bank (臺灣企銀), Chang Hwa Commercial Bank (彰化銀行) and Mega International Commercial Bank (兆豐銀行) said they have set the payout at 4.6 months, because their loan to Ching Fu was modest.
Ching Fu has a navy contract worth NT$35.8 billion to build six minesweepers, but its solvency has been called into question after the Kaohsiung District Prosecutors’ Office named it in a financial fraud investigation.
Leading Taiwanese bicycle brands Giant Manufacturing Co (巨大機械) and Merida Industry Co (美利達工業) on Sunday said that they have adopted measures to mitigate the impact of the tariff policies of US President Donald Trump’s administration. The US announced at the beginning of this month that it would impose a 20 percent tariff on imported goods made in Taiwan, effective on Thursday last week. The tariff would be added to other pre-existing most-favored-nation duties and industry-specific trade remedy levy, which would bring the overall tariff on Taiwan-made bicycles to between 25.5 percent and 31 percent. However, Giant did not seem too perturbed by the
Foxconn Technology Co (鴻準精密), a metal casing supplier owned by Hon Hai Precision Industry Co (鴻海精密), yesterday announced plans to invest US$1 billion in the US over the next decade as part of its business transformation strategy. The Apple Inc supplier said in a statement that its board approved the investment on Thursday, as part of a transformation strategy focused on precision mold development, smart manufacturing, robotics and advanced automation. The strategy would have a strong emphasis on artificial intelligence (AI), the company added. The company said it aims to build a flexible, intelligent production ecosystem to boost competitiveness and sustainability. Foxconn
TARIFF CONCERNS: Semiconductor suppliers are tempering expectations for the traditionally strong third quarter, citing US tariff uncertainty and a stronger NT dollar Several Taiwanese semiconductor suppliers are taking a cautious view of the third quarter — typically a peak season for the industry — citing uncertainty over US tariffs and the stronger New Taiwan dollar. Smartphone chip designer MediaTek Inc (聯發科技) said that customers accelerated orders in the first half of the year to avoid potential tariffs threatened by US President Donald Trump’s administration. As a result, it anticipates weaker-than-usual peak-season demand in the third quarter. The US tariff plan, announced on April 2, initially proposed a 32 percent duty on Taiwanese goods. Its implementation was postponed by 90 days to July 9, then
AI SERVER DEMAND: ‘Overall industry demand continues to outpace supply and we are expanding capacity to meet it,’ the company’s chief executive officer said Hon Hai Precision Industry Co (鴻海精密) yesterday reported that net profit last quarter rose 27 percent from the same quarter last year on the back of demand for cloud services and high-performance computing products. Net profit surged to NT$44.36 billion (US$1.48 billion) from NT$35.04 billion a year earlier. On a quarterly basis, net profit grew 5 percent from NT$42.1 billion. Earnings per share expanded to NT$3.19 from NT$2.53 a year earlier and NT$3.03 in the first quarter. However, a sharp appreciation of the New Taiwan dollar since early May has weighed on the company’s performance, Hon Hai chief financial officer David Huang (黃德才)
RSS