State-run Mega Financial Holding Co (兆豐金控) yesterday said that it expects loan growth this year, helped by an export-driven economic recovery, and is eyeing solid gains in wealth management amid a pickup in investment sentiment
“We would seek to remain the best performer in terms of earnings ability this year among state-run peers,” Mega Financial chairman Lei Chung-dar (雷仲達) told an online investors’ conference.
The group would consolidate its leadership position in syndicated loans, corporate banking and foreign currency operations, Lei said.
Photo courtesy of Mega Financial Holding Co
Net income last year surged 81 percent to NT$33.25 billion (US$1.05 billion), or earnings per share of NT$2.37, outperforming other state-run financial institutions, he said.
That is because interest rate hikes at home and abroad shored up interest incomes, while restrictive monetary policies increased funding costs and inhibited loan demand, Mega Financial said.
Hopefully, the situation would ease in the second half of this year after the US Federal Reserve starts to cut interest rates, making corporations more willing to take out loans, it added.
However, the interest rate gap between Taiwan and the US would mitigate, becoming less favorable for foreign exchange swap operations, which generated more than NT$10 billion in trading gains last year, it said.
The company’s banking arm, Mega International Commercial Bank (兆豐銀行), expects local tech firms to display more borrowing interest this year on the back of a positive technology product cycle and a recent artificial intelligence frenzy, Mega International Commercial Bank president David Hu (胡光華) said.
At the same time, Mega Financial is seeking to increase sales of mutual funds and insurance policies by 30 percent this year, as Taiwanese demonstrate better risk appetite, Mega Financial said, citing avid interest among retail investors for exchange-traded funds.
Mega Bank is collaborating with department stores, airlines, travel agencies and online hotel booking operators to win customers and boost credit card spending, it said.
However, the group’s non-life insurance wing, Chung Kuo Insurance Co (兆豐產險), remained a profit drag due to lingering COVID-19 insurance claims, it said.
Chung Kuo Insurance is contemplating capital increase plans to improve its financial health after setting aside NT$2.8 billion last year, it added.
Mega Financial declined to comment on its dividend policy except that the board of directors will discuss the matter next month.
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