Fubon Financial Holding Co’s (富邦金控) board of directors on Thursday approved a proposal to distribute a record cash dividend of NT$3 per share, topping proposals by local peers, data showed.
The previous time Fubon paid at least a NT$3 cash dividend was in 2015.
This year’s payout ratio would be about 35 percent, based on the company’s earnings per share of NT$8.54 last year, with a dividend yield of 4.67 percent given its share price of NT$64.2 when markets closed on Thursday.
Photo: Kelson Wang, Taipei Times
Its board also approved the issuance of a NT$1 stock dividend, Fubon Financial said.
It plans to allocate part of its capital surplus to pay the stock dividend, the firm said.
It would pay NT$30.7 billion (US$1.1 billion) in cash dividends, the company said.
The proposal is subject to shareholders’ approval at its annual meeting on June 11.
Fubon Life Insurance Co (富邦人壽) contributed NT$7.44 billion to its parent company’s profit, or 12.2 percent of the unit’s net profit of NT$61 billion last year, Fubon Financial said.
It was the first time in three years that Fubon Life has allocated its profit to fund its parent’s cash dividend distribution, Fubon Financial said.
The financial conglomerate usually recognizes profit at its subsidiaries according to standard accounting practices, it said, adding that it needs approval from the Financial Supervisory Commission to use the funds to pay dividends.
Life insurers have been instructed to set profit aside ahead of stricter solvency rules that are to take effect in 2025.
Cathay Life Insurance Co (國泰人壽), a life insurance arm of Cathay Financial Holding Co (國泰金控), and Taiwan Life Insurance Co (台灣人壽), a subsidiary of CTBC Financial Holding Co (中信金控), have followed recommendations from the commission and not delivered their profit to their parents, their data showed.
That partly explains why Fubon Financial is able to propose a higher dividend than its peers.
Cathay Financial’s board of directors on Wednesday approved a proposal to distribute a cash dividend of NT$2.5 per share, the second-highest among local financial conglomerates.
That suggested a payout ratio of 46 percent and a dividend yield of 4.78 percent, corporate data showed.
Cathay Financial estimated that it would pay NT$32.9 billion in dividends, it said.
State-run Mega Financial Holding Co (兆豐金控) announced a proposed cash dividend of NT$1.58 per share, suggesting a payout ratio of 85 percent and a dividend yield of 4.83 percent, company data showed.
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