State-run Taiwan Cooperative Financial Holding Co (TCFH, 合庫金控) on Wednesday said the operating environment might start to improve in the second half of the year as the worst of the COVID-19 pandemic this quarter is over.
TCFH chairman Lei Chung-dar (雷仲達) made the remarks after the company’s annual general meeting, when government-appointed candidates secured an overwhelming majority on the company’s board, winning 13 of 15 seats.
“The worst impact from the virus outbreak is likely over for Taiwan and things might start to improve going forward,” said Lei, who is also a director on the central bank board, and poised to remain at the helm of the bank-focused conglomerate.
Main subsidiary Taiwan Cooperative Bank (合庫銀行), the nation’s largest lender by number of branches, aims to increase its loan book by 3 percent this year, aided by companies shifting production back to Taiwan from China as well as a recovery in property deals.
The lender, one of Taiwan’s top mortgage operators, posted an 8.5 percent pickup in land financing and another 2.7 percent gain in mortgage lending in the first quarter, compared with a year earlier.
Lei said that people who previously postponed property purchases might start to resume buying after the virus crisis in Taiwan began to wind down late last month.
Government data showed that the housing market from February to last month held resilient with a low single-digit percentage decline compared with the same period last year.
Meanwhile, demand for factory and office space is expected to gain traction from returning companies seeking to diversify manufacturing sites and cope with US-China trade tensions, brokers have said.
Overall, the record low interest rate would lend support to property purchases, Lei said.
There is no need to worry about a property bubble, he said, adding that real demand underpins housing deals these days and the central bank has policy tools such as credit controls to curb speculation.
The boom in domestic tourism is also favorable for consumer banking, Lei told shareholders, as all lenders have offered cash rebates or credit bonuses to customers who use stimulus vouchers to pay for transportation, hotels, restaurant meals, shopping or other recreational expenses.
Shareholders at the meeting approved a proposal to distribute a cash dividend of NT$1.15 per common share.
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