The combined pretax profit of the nation’s financial companies plunged 32 percent annually to NT$558.5 billion (US$18.21 billion) in the first 10 months of this year, as global market routs hit insurance companies and securities brokerages, Financial Supervisory Commission data showed yesterday.
Life insurance companies reported a combined pretax profit of NT$291.4 billion through October, down 22.4 percent from a year earlier, as net investment gains contracted 5.5 percent, commission data showed.
Non-life insurers posted a combined loss of NT$133.8 billion in the first 10 months due to COVID-19 insurance policy claims of NT$11.3 billion, compared with a pretax profit of NT$21.4 billion in the same period last year, the data showed.
Photo courtesy of CTBC Financial Holding Co via CNA
Insurers registered a combined pretax profit of NT$157.6 billion, down 60 percent annually, the data showed.
Local securities companies’ pretax profit reported an annual retreat of 55 percent in combined pretax profit to NT$53 billion on falling fee revenue, the commission said.
The banking sector is the sole sector in the black, as banks’ combined profit grew 11 percent to NT$347 billion thanks to the central bank’s rate hikes and a growth in loans, Banking Bureau Deputy Director Phil Tong (童政彰) said.
Banks’ net interest income expanded 16.8 percent from a year earlier to NT$500 billion, despite single-digit percentage decreases in fee income and investment gains, Tong said.
While Taiwan’s financial companies registered a record pretax profit of NT$936.6 billion last year, they are expected to post an annual decline in profit this year in light of a high comparison base, along with insurance losses and volatile global markets, the commission said.
Several financial holding companies earlier said that they are planning to use their retained earnings to next year distribute cash dividends in spite of sluggish earnings growth this year.
The companies said their payout plans are still subject to the commission’s approval.
In principle, the commission would only allow companies with solid capital adequacy to distribute cash dividends next year, FSC Chairman Thomas Huang (黃天牧) told a meeting of the legislature’s Finance Committee.
How the companies would distribute their cash dividends and what sources they would use for the payouts are other factors, he said.
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