The local finance sector reported combined pretax profit of NT$675.7 billion (US$23.77 billion) last year, up 6.5 percent from a year earlier, the Financial Supervisory Commission said yesterday, attributing the record-high to life insurers’ investment gains and securities firms’ fee incomes.
Life insurers reported combined pretax profit of NT$206.1 billion, up 33.2 percent year-on-year, on the back of investment gains of NT$83 billion in global stocks markets, commission data showed.
Meanwhile, life insurers recorded NT$296.8 billion in foreign-exchange losses and hedging expenses last year, up 1.92 percent from a year earlier, due to the New Taiwan dollar’s appreciation against the US dollar, the commission said.
The NT dollar rose 5.6 percent against the greenback last year.
About two-thirds of life insurers’ investment portfolios, totaling more than NT$18 trillion, are overseas investments or denominated in US dollars, it said.
The life insurance industry posted combined losses of NT$581 billion in the valuation of their US dollar-denominated assets as of the end of last month, which was partly offset by gains of NT$436 billion in the valuation of their hedging tools denominated in NT dollar or other Asian currencies, the commission said.
Hedging expenses totaled NT$160 billion last year, it said.
Property insurers’ combined pretax profit grew 6.3 percent annually to NT$17 billion, the data showed.
Last year, securities companies reported combined pretax profit grew 51 percent year-on-year to NT$65.8 billion, futures companies’ pretax profit expanded 17 percent to NT$5 billion and securities investment trust firms’ pretax profit increased 20 percent to NT$10.9 billion, all hitting the highest in nine years, the commission said.
However, banks’ profits fell last year, as their combined pretax profit decreased 13 percent to NT$312.7 billion due to declining interest income, foreign exchange losses and lower investment gains, it said.
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