Fitch Ratings yesterday affirmed the ratings of SinoPac Financial Holdings (
The ratings on SinoPac Financial are based on the company's strong capitalization, limited leverage, prudent risk culture and reasonable profitability derived from its major units Bank SinoPac (建華銀行) and SinoPac Securities Corp (建華證券), Fitch said in a statement.
The coming acquisition of International Bank of Taipei (IBT, 台北商銀) would allow SinoPac Financial to expand distribution channels and doubled banking assets, as well as sharpen its competitive edges against other major financial holdings, Fitch said. The deal would enhance SinoPac Financial's earnings stability due to an expected increase in share of profits sourced from commercial banking activities, as opposed to the volatile brokerage and investment banking businesses, it said.
But the upcoming integration could present a major challenge to the management of Bank SinoPac and IBT in light of the differences in corporate cultures and management systems, Fitch said.
The Financial Supervisory Commission said it had approved the takeover of IBT as a wholly-owned subsidiary through a full share swap, which would boost SinoPac's capital adequacy ratio to 143 percent after the merger, compared with 136 percent at the end of June.
The merger is expected to make SinoPac Financial the nation's eighth-largest financial-services provider, with over NT$1 trillion (US$30 billion) in assets. Its total number of outlets will expand to 161, the company said.
SinoPac Financial shares yesterday closed up 0.36 percent at NT$14.05 on the Taiwan Stock Exchange.
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