Hua Nan Financial Holdings Co (華南金控) aims to improve its earnings this year by raising income contribution from its overseas banking operations and strengthening loans to small and medium enterprises (SME), company officials said yesterday.
The state-run financial service provider is looking at loan growth of 27.5 percent from its offshore and overseas banking units and 9 percent from SMEs, officials told investors in a conference call.
For the first three months of the year, offshore banking units and overseas operations accounted for 30 percent of the bank-focused conglomerate’s net profit of NT$2.61 billion (US$86.81 million), up 75 percent from the previous quarter, but down 4 percent from a year earlier, company data showed.
The company’s banking unit, Hua Nan Commercial Bank (華南銀行), still expects lending to grow by 4.25 percent this year, although the domestic economy fared weaker than expected in the first quarter, company officials said.
In the first quarter, Hua Nan Bank posted a net profit of NT$2.45 billion, rising 62 percent from the previous quarter, with interest income gaining 6 percent year-on-year to NT$5.5 billion and fee income increasing 16 percent to NT$1.04 billion, Hua Nan Financial president Ed Liu (劉茂賢) said.
The bank plans to upgrade its representative office in Hanoi, Vietnam, to a branch later this year and is seeking to expand into Cambodia and other ASEAN nations to better serve Taiwanese firms there.
However, the lender has made little progress in its attempts to buy a stake in a Chinese peer.
Hua Nan Financial chairman Wang Rong-jou (王榮周) said during a public function over the weekend that expanding the company’s presence in China continues to top the groups’ agenda, adding that Hua Nan Bank would seek to invest in Chinese lenders with customer bases in second or third-tier cities.
The bank’s Shenzhen branch has since March 29 been allowed to offer yuan-based products and services. It is awaiting regulatory approval to open a sub-branch in the city, Hua Nan Financial said.
Meanwhile, its securities arm, Hua Nan Securities Co (華南永昌證券), reported a net profit of NT$51 million last quarter, reversing net losses of NT$16 million in the preceding quarter, but still down 73 percent from the year-earlier level.
Company officials attributed the lackluster performance to sluggish trading in the local bourse, but expected the situation to improve if the government pushes through with a proposal to revise the capital gains tax on securities investment.
Shares in Hua Nan Financial ended flat at NT$17.50 yesterday.