State-run Hua Nan Financial Holding Co (華南金控) aims to boost its profit margin this year by diversifying its sources of income and achieving a higher capital utilization rate.
The bank-focused conglomerate said it intends to step up lending operations for small and medium-sized enterprises (SMEs), which could account for 70 percent of its loan book and raise the bank’ s interest rate spread.
“Hua Nan Financial will shore up its legal compliance system and capital utilization rates this year, while pressing ahead with efforts to support firms in the five-plus two sectors,” chairman Wu Tang-chieh (吳當傑) told a news conference.
Hua Nan Commercial Bank (華南銀行), the holding firm’s main subsidiary and source of income, is to increase loans to the “five plus two” industries by NT$15 billion (US$512.12 million), in line with the Cabinet’s plan to stimulate local development of an “Asian Silicon Valley,” and “smart” machinery, “green” energy, biomedicine and defense industries, as well as a new agricultural business model and a circular economy.
The lender has built a clientele list of 8,000 in those sectors, with a total of NT$400 billion in outstanding loans in December last year, Wu said, adding that loans to firms involved in “green” energy development amounted to NT$76 billion.
Hua Nan Bank would refrain from loan book expansion, but would seek to widen interest spread by 6 basis points this year, from an average of 1.4 percent last year, the bank executive vice president Jonathan Huang (黃俊智) said.
Net interest income, a critical gauge of banks’ profitability, hovered around 1.07 percent last year, he said.
The focus on SMEs and overseas operations would help expand the margin following interest rate hikes in the US and other countries, he said.
The lender is looking at a 5 percent increase in SME lending from NT$400 billion, company data showed.
The bank of 180 branches would keep mortgage operations flat this year, as the local property market has yet to come out of price correction pressures, although transactions have improved, Huang said.
Overall, the financial holding reported a net income of NT$12.09 billion last year, or earnings per share of NT$1.09. The showing represented a 14.29 percent decline from NT$14.09 billion recorded in 2016.
The company’s banking arm took part in the syndicated loan of NT$20.5 billion to troubled Ching Fu Shipbuilding Co (慶富造船) and booked a bad loan of NT$1.7 billion.
The lender last year wrote down additional bad debt of NT$2 billion linked to TransAsia Airways Corp (復興航空), but could recover some of the debt this year after the company found buyers for its aircraft.
DEAL LIKELY DEAD: As takeovers of semiconductor firms become national security issues amid a global microchip shortage, deals are becoming more difficult GlobalWafers Co (環球晶圓) failed to reach a breakthrough in a last-ditch bid to salvage its planned takeover of Siltronic AG, likely spelling the collapse of the US$5 billion deal. The Taiwanese technology company did not resolve the government’s concerns during a private meeting between GlobalWafers chairwoman Doris Hsu (徐秀蘭) and German Federal Ministry for Economic Affairs and Climate Action State Secretary Udo Philipp, people familiar with the matter said. Siltronic shares tumbled as much as 4.7 percent on the news on Friday, extending the stock’s decline for the year to more than 20 percent. While the ministry continues to examine the deal,
BOOMING ORDERS: As orders move away from neighboring countries such as India, Pakistan’s economic bright spot has found new customers in South America and Africa Pakistan’s textile sector is bringing cheer to its flailing economy, with exports set to swell to a record after gaining an edge over South Asian rivals during the COVID-19 pandemic. Textile exports are poised to surge 40 percent from a year earlier to a record US$21 billion in the 12 months ending in June, said Abdul Razak Dawood, commerce adviser to Pakistan’s prime minister. Dawood said that the figure would expand to US$26 billion in the next fiscal year, surpassing the nation’s total exports last year, he said. The textiles industry — which supplies everything from denim jeans to towels for buyers
Samsung Electronics Co is stepping up spending on advanced chipmaking technology as it sees growing demand for its smartphones, displays and memory products. South Korea’s largest company reported 43.6 trillion won (US$36.17 billion) in semiconductor capital expenditure last year, eclipsing rivals as it acquired extreme ultraviolet lithography (EUV) machines to pursue an aggressive expansion of its most lucrative memory and system chipmaking. It expects a recovery in server and PC memory demand, and said foldables are already helping its sales growth, although declined to offer a forecast due to the high degree of uncertainty around supply chains and the COVID-19 pandemic. Samsung
The data transmission speed of 6G (sixth-generation wireless) networks is expected to be 10 to 100 times faster than 5G technology, MediaTek Inc (聯發科) said in a paper released on Jan. 18. 6G standardization is expected to begin in 2024 or 2025, with the first standard technology expected in 2027 or 2028, said MediaTek, one of the world’s leading chip design companies. “Our 6G vision is of an adaptive, integrated and super heterogeneous wireless communication system, delivering pervasive mobile connectivity in a truly ubiquitous manner,” the paper said. The sector is making breakthroughs in the research and development (R&D) of key 6G technologies,