State-owned Land Bank of Taiwan (土地銀行) aims to achieve steady profit growth this year by ramping up its wealth management, credit and digital financing operations, top executives said yesterday as the lender reported earnings growth on high interest income last year.
Land Bank, the nation’s largest mortgage provider, set the goal during an internal meeting of 200 officials from different units that started yesterday and ends today.
“The bank aims to achieve that goal without compromising risk management and legal compliance, and despite growing uncertainty over the economic context at home and abroad,” Land Bank chairwoman Joanne Ling (凌忠嫄) said.
The lender earned NT$12.1 billion (US$392.31 million) in pre-tax income last year, a 17.66 percent increase from NT$11.86 billion in 2017 and surpassing a government target by 29 percent, bank data showed.
Interest income accounted for 81.74 percent of total earnings, much higher than the 38.5 percent banking sector average, local media reported, citing a report by the Legislative Yuan.
Among state-run peers, the ratio was 64.46 percent at Taiwan Cooperative Bank (合庫銀行), 54.67 percent at Chang Hwa Commercial Bank (彰化銀行), 53.65 percent at Hua Nan Commercial Bank (華南銀行) and 30.95 percent at First Commercial Bank (第一銀行).
The figures suggest much room for improvement for fee income at Land Bank, which should adjust its strategy and seek to increase fee income without abandoning its leadership position in construction and land financing, Ling said.
Land Bank has to support the government’s policy to make mortgages available for young home buyers, senior citizens, retirement trusts and urban renewal projects, she said, adding that replacement of old and dilapidated buildings presents a huge market.
In addition, Land Bank has helped financed corporate initiatives related to the Cabinet’s “five plus two” innovative industries and New Southbound Policy, she said.
To that end, the lender is to increase its presence in Southeast Asia, with plans to set up new branches or offices in Indonesia, Malaysia, the Philippines and Australia beginning this year to better serve Taiwanese companies in those markets, Ling said.
As for financial innovation, Land Bank would not sit on the sidelines as mobile payments and digital banking grow, she said.
The bank is to groom talented employees for operations in Taiwan and foreign markets, she added.
Ling called on all her colleagues to help increase business from existing clients and to help raise customer satisfaction.
It was the eighth consecutive year that Land Bank posted pre-tax income of more than NT$10 billion.
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