Sat, Mar 09, 2019 - Page 12 News List

CHB expecting stable profit growth

STRATEGY:The state-run lender aims to focus on firms that fall under the government’s ‘five plus two’ innovative industries plan and those with operations in Southeast Asia

By Crystal Hsu  /  Staff reporter

State-run Chang Hwa Commercial Bank (CHB, 彰化銀行) aims to grow its profit this year at a slightly faster rate than the nation’s GDP growth, driven by overseas operations and lending to small and medium-sized enterprises (SMEs), officials said yesterday.

The bank posted NT$12.6 billion (US$407.74 million) in net income for last year, a 4.58 percent annual increase and translating into earnings per share of NT$1.29.

Pretax profit rose 3.71 percent to NT$14.71 billion, more than meeting a target of NT$14.5 billion, company data showed.

“We will pursue stable profit growth this year by strengthening core operations and tapping into digital banking, despite growing economic uncertainty,” Chang Hwa Commercial Bank chairman Chang Ming-daw (張明道) told a media briefing.

The bank plans to increase loans by 3 percent from last year, which is modestly higher than the Directorate-General of Budget, Accounting and Statistics’ projected GDP growth of 2.27 percent, Chang said.

The economic environment in Taiwan is not as gloomy as expected and the bank would be more flexible with its credit and capital when meeting its business target, Chang said.

SME loans might increase 5 to 6 percent this year, in line with last year’s 5.8 percent annual pickup, Chang Hwa Commercial Bank president David Chang (張鴻基) said.

The lender would focus on companies targeted by the government’s “five plus two” innovative industries plan and those with operations in Southeast Asia to support the government’s industrial policy, he said.

Overseas and offshore operations, which generated 42 percent of the bank’s overall earnings last year, are expected to contribute 47 to 48 percent this year, as branches in the Philippines and China might start to bear fruit, the lender said.

The bank hopes to open a branch in Houston, Texas, to expand its services in the US, company officials said, adding that the branch could be launched later this year if authorities give their approval.

Chang Hwa Commercial Bank also plans to add 250 workers to investigate business opportunities linked to financial technology, which is shaking up the banking industry, Chang Ming-daw said.

While the lender is not vying for Web-only banking licenses, it has no intention of sitting out the digital revolution, the chairman said.

This recruitment round is mainly targeting people with expertise in cybersecurity, e-commerce and information technology, he said.

Chang Hwa Commercial Bank generated NT$2.24 billion in net income for the first two months of this year, or earnings per share of NT$0.23, company data showed.

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