State-run Mega Financial Holding Co (兆豐金控) is expecting healthy business growth this year from strong wealth management product sales and corporate banking, top executives said yesterday.
The conglomerate also made significant headway in upgrading its anti-money laundering system after being fined heavily by financial regulators in the US in recent years over compliance failures.
The group posted NT$25.74 billion (US$878.74 million) in net income for last year, with all subsidiaries generating profits despite a further US$29 million in fines from US financial authorities for previous breaches of US money laundering and banking secrecy laws, Mega Financial chairman Michael Chang (張兆順) told a media briefing in Taipei.
The earnings performance represented a 15 percent increase from a year earlier, or earnings pre share of NT$1.96, company data showed.
Chang, who recently visited US financial regulators, said the US was impressed with what Mega International Commercial Bank’s (兆豐商銀) US branches have achieved in terms of strengthening compliance.
“The bank will press ahead with the system upgrade that will take a while to complete,” Chang said, adding that the computer system would automatically raise alerts when it spots irregular transactions.
Overseas and offshore banking units generated 55 percent of overall profits last year, down from 60 percent a year earlier due to structural adjustments that are continuing, Chang said.
Overseas operations might strengthen this year as Mega Bank commands the largest market share among its peers in terms of international financing and foreign currency deposits, Mega Financial president David Hu (胡光華) said.
The interest rate hikes by the US Federal Reserve are favorable for lending operations and assets denominated in US dollars, he said.
A stable global economy could help Mega Bank increase its wealth management product sales and corporate lending operations by 30 percent this year, bank president Robert Tsai (蔡永義) said.
The bank might increase its loan book by 4 percent, Tsai said, better than domestic economic growth that might expand by 2.42 percent as the Directorate-General of Budget, Accounting and Statistics forecast last month.
Consumer lending generated 15.3 percent of net profit, suggesting ample room for improvement, Hu said.
“We aim to strengthen consumer banking so it can register a 5 percent improvement in two coming years and develop into a major profit driver, accounting for 30 percent in the long run,” Hu said.
Mega Financial posted NT$2.43 billion in net income in January, or earnings per share of NT$0.18, according to its stock filing.
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