Fubon Financial Holding sees net profit soar 28%

By Kao Shih-ching  /  Staff reporter

Tue, Aug 13, 2019 - Page 12

Fubon Financial Holding Co (富邦金控), the nation’s second-largest financial services provider by assets, reported that net profit last month jumped 28 percent from a year earlier to NT$14.56 billion (US$463.7 million), or earnings per share of NT$4.13.

The firm became the first financial conglomerate with earnings per share higher than NT$4, compared with Cathay Financial Holding Co (國泰金控) with NT$3.04, CTBC Financial Holding Co (中信金控) with NT$1.45 and Mega Financial Holding Co’s (兆豐金控) NT$1.33, the companies' data showed.

Fubon Financial’s performance last month came as major units Fubon Life Insurance Co (富邦人壽) and Taipei Fubon Commercial Bank (台北富邦銀行) saw net profit increase by double-digit percentages, thanks to stable growth in their interest, dividend and fee incomes, company data showed.

Fubon Life saw its first-year premium expand 26 percent annually to NT$137.9 billion last month. The insurer remained the most lucrative subsidiary with cumulative profit of NT$21.34 billion in the first seven months, accounting for 50.5 percent of the conglomerate’s overall profit of NT$42.23 billion.

However, another conglomerate with an insurance focus, Cathay Financial, reported that net profit last month fell to NT$7.46 billion from NT$11.27 billion a year earlier.

The company’s cumulative profit for the first seven months fell 12 percent to NT$41.59 billion, company data showed.

Cathay Financial’s insurance arm, Cathay Life Insurance Co (國泰人壽), last month posted a 46.6 percent decline in net profit year-on-year, with cumulative profit falling 27.5 percent year-on-year, the data showed.

The declines might be the result of lower investment returns and smaller capital gains due to greater volatility in the global financial markets this year, company spokesman Daniel Teng (鄧崇儀) told the Taipei Times by telephone.

“The insurance unit has a lot of unrealized capital gains, with net value hitting NT$540 billion as of the end of last month — the highest net value ever,” Teng said. “Every financial conglomerate has a different strategy about when to realize capital gains. Net profit is not the only gauge that matters.”