Sat, May 05, 2018 - Page 12 News List

King’s Town sees nearly 50% drop in net profit

By Crystal Hsu  /  Staff reporter

King’s Town Bank (京城銀行) posted NT$254 million (US$8.55 million) in net profit for last month, a nearly 50 percent retreat from the same period last year, weighed by stock investment losses, the lender said in a filing with the Taiwan Stock Exchange (TWSE) on Thursday.

The Tainan-based lender had more than NT$6 billion in local shares that incurred losses of NT$240 million amid price corrections across global bourses.

The TAIEX last month shed 230.39 points, or 0.21 percent, amid market unease over a looming trade war between the US and China, as well as conservative revenue projections by major local technology firms.

In addition to stock investment losses, King’s Town last month saw its pretax income shrink 59.33 percent to NT$344 million, because bond holdings lost value due to hikes in bond yields.

For the first four months of this year, the lender’s pretax income totaled NT$1.79 billion, an 8.4 percent decline from a year earlier, while net income slowed 10.8 percent to NT$1.55 billion, or earnings per share of NT$1.35.

Despite the retreat, King’s Town said it managed to expand core banking operations, aided by a continued global economic expansion.

Local companies are feeling more comfortable with capital spending this year as global GDP is expected to gain 3.4 percent, King’s Town said, adding that the positive sentiment is favorable for wealth management product sales.

Interest and fee incomes showed an improvement last quarter, the lender said.

Looking forward, King’s Town said it is to press ahead with its decision to focus on small and medium-sized enterprises and improve its risk management.

In addition, the lender said it aims to tap into financial technology and e-commerce business opportunities by broadening its product lines.

King’s Town reported a net profit of NT$1.29 billion last quarter, or earnings per share of NT$1.13, the filing showed.

That represents a 4.6 percent gain from the same period last year, thanks to interest and fee income growth, the filing showed.

King’s Town shares yesterday fell 3.49 percent to close at NT$34.6, bucking the TAIEX’s 0.23 percent gain.

The lender’s stock has declined 8.32 percent this year, underperforming the banking sector’s 3.26 percent increase, TWSE data showed.

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