King’s Town Bank (京城銀行) yesterday reported losses of NT$1.03 billion (US$33.35 million) for last month due to higher provisioning for its NT$1.64 billion loan to Chunghwa Picture Tubes Ltd (CPT, 中華映管).
As a result, the bank’s full-year profit slumped 51.06 percent to a record low of NT$2.88 billion, from NT$5.87 billion in 2017. That translated into earnings per share of NT$2.51.
The bank said it would seek to recover the loan through CPT’s land and factory equipment collaterals.
“Last year, the bank saw more volatility in its monthly earnings due to global market tumults,” bank spokesman You Qi-wei (尤其偉) told the Taipei Times by telephone.
New accounting rules also require recognition of expected losses related to financial assets, he said.
The bank did not expect to see investment losses of NT$488 million in October amid a global equity rout and booked a profit of NT$792 million in November, a record high for a single month, You said.
Still, the bank reported sturdy growth in interest and fee income last year, You said.
Interest income rose 12 percent to NT$1.76 billion in the third quarter, while fee income gained 5.2 percent to NT$480 million, company data showed.
The bank is to revisit its investment strategy to curb losses as the market is expected to remain volatile this year because of the US-China trade dispute, the bank said.
Its non-performing loan ratio was unchanged at 0.02 percent as of the end of last month, despite potential losses linked to CPT, bank data showed.
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