O-Bank Co Ltd (王道商業銀行) yesterday outlined its plans to transform itself into a nimble and digitally focused boutique lender as it prepares for its initial public offering (IPO) next month.
The bank is scheduled to have its market debut on May 5 — the first bank listing in Taiwan in 13 years — with an eye to raising NT$225 million (US$7.4 million) in new funds, the bank said.
The company has positioned itself as an asset-light boutique bank that yields higher returns on equity compared with its larger domestic peers, O-Bank president C.Y. Yang (楊錦裕) said at an earnings conference in Taipei.
From 2014 to last year, the bank posted an average ROE of 11.6 percent, besting the industry average of 10.42 percent, Yang said.
During the same period, the company also achieved higher operating efficiencies, which are reflected in its lower non-performing loan ratio of 0.02 percent, compared with the industry average of 0.27 percent, he said
The bank — formerly known as the Industrial Bank of Taiwan (台灣工業銀行) before its transformation into a commercial bank — reported a net income of NT$1.86 billion for last year, up 17 percent from the previous year.
Headquartered in Taipei’s Neihu District (內湖), the bank has only five branches in Taiwan and one branch in Hong Kong, and is to carve out its own niche by leveraging digital channels, as opposed to larger banks, Yang said.
For corporate lending, the company will focus on special purpose loans in the field of mergers and acquisitions, as well as expanding into overseas markets through its Hong Kong branch, he said.
For the consumer market, the company is aiming to take on the younger demographic who favor mobile banking, offering convenient account setups, credit loan approvals and unlimited cash rewards on purchases, Yang said.
To attract younger consumers, savings accounts bearing a 0.3 percent interest rate may be set up for as little as NT$100, Yang added.
The company plans to launch a new investment advisory service next month, targeting young consumers who are often overlooked by major banks’ wealth management businesses, he said.
The new robot-powered advisory service, which will provide investment recommendations generated by software, not human financial advisers, will start with a three-month pilot program, he said.
O-Bank said it would cover investment losses from its robo-advisory services — but limited to NT$1,000 — and once the service is officially launched, consumers can participate with small amounts under its advisory management.
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