Sat, Jan 12, 2019 - Page 12 News List

Volatile markets see Fubon, Cathay slide into the red

By Kao Shih-ching  /  Staff reporter

Fubon Financial Holding Co (富邦金控) and Cathay Financial Holding Co (國泰金控), the nation’s two largest financial services conglomerates, drifted into the red last month as volatility in global stock markets dented their profit momentum.

Fubon Financial posted a NT$5.06 billion (US$164.3 million) net loss, down from a net profit of NT$3.11 billion a year earlier, mainly due to losses of NT$5.56 billion at Fubon Life Insurance Co (富邦人壽) amid volatility on global stock markets last month.

Fubon Life, which last month set aside an additional NT$3 billion as a special reserve to buffer against potential foreign-exchange losses, saw its first-year premiums for the whole of last year grow 9 percent year-on-year to NT$190.4 billion and its total premiums increase 5 percent to NT$543 billion, the company said in a statement.

Cathay Financial posted a NT$4.12 billion net loss, down from a net profit of NT$2.03 billion a year earlier, due mainly to losses of NT$5.79 billion at Cathay Life Insurance Co (國泰人壽).

With the TAIEX plunging 1.7 percent and US stocks slumping 9 percent last month, Cathay Life saw negative returns on its investments, and the widening interest spread between Taiwan and the US also increased its foreign-exchange hedging costs, it said.

Despite substantial losses last month, Cathay Financial was still the most profitable financial services conglomerate last year as it posted an overall net profit of NT$52.57 billion, a 7.4 percent decrease year-on-year, or earnings per share of NT$4.01.

Fubon Financial ranked second, posting a cumulative net profit of NT$48.04 billion, down 10.67 percent year-on-year, or earnings per share of NT$4.55, the company said.

Waterland Financial Holdings Co (國票金控) posted NT$2.02 billion in net profit last year, the lowest of all its peers. That was a 14.73 percent decrease year-on-year.

Overall, the nation’s 15 listed financial conglomerates reported a combined net profit of NT$293.69 billion for last year, down 1.17 percent from 2017, while six reported a net loss last month.

The other four firms reporting a net loss were Shin Kong Financial Holding Co (新光金控) (NT$2.4 billion), Yuanta Financial Holding Co (元大金控) (NT$389 million), Taishin Financial Holding Co (台新金控) (NT$250 million) and China Development Financial Holding Corp (中華開發金控) (NT$92 million).

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