CTBC Financial Holding Co (中信金), Taiwan’s third-largest financial group by assets, yesterday said it would maintain its strategy of keeping a 70-30 split between banking and non-banking operations as it pursues growth and acquisition opportunities.
The group shared its development plans after reporting that first-half net income was NT$35.84 billion (US$1.18 billion), down 4 percent year-on-year, but outperforming the sector’s 35 percent slump.
Its flagship unit, CTBC Bank (中國信託銀行), delivered record earnings, while life insurance arm, Taiwan Life Insurance Co (台灣人壽), reported a 45 percent drop, weighed down by foreign-exchange losses.
Photo: CNA
CTBC Financial president and spokeswoman Rachael Kao (高麗雪) expressed cautious views for the second half, highlighting global trade tensions, tariff risks and equity market volatility as potential headwinds.
Taiwan’s economy expanded 6.75 percent in the first half, but expansion is expected to slow to 2.3 percent in the remainder of the year, as many companies had front-loaded orders in anticipation of US tariff measures, Kao said.
CTBC Bank posted after-tax profit of NT$27.7 billion in the year to June, a 20 percent rise from the first half last year, fueled by 13 percent loan growth and nearly 20 percent growth in net interest income due to lower foreign-currency funding costs.
Fee income rose by a nearly double-digit percentage, supported by wealth management initiatives.
Overseas operations contributed NT$12.4 billion in pretax profit, up 10 percent from a year earlier and accounting for 36 percent of the total, among the highest in Taiwan’s financial industry.
By contrast, Taiwan Life booked NT$7.2 billion in profit, down 45 percent, as the New Taiwan dollar’s appreciation against the US dollar resulted in foreign-exchange losses.
The insurer boosted its capital base by adding NT$15.1 billion to reserves in June under a new regulatory reserve regime.
First-year premium sales climbed by about NT$1.7 billion in the year through July, helped by expanded distribution channels and diversified product offerings.
Kao declined to comment on media speculation regarding a potential acquisition of Mercuries Life Insurance Co (三商美邦人壽), reiterating that CTBC Financial Holding would adhere to its 70-30 principle guiding banking and non-banking operations.
The group would favor acquisitions that can generate asset synergies, improve profitability and capital allocation, and enhance customer services, she said.
Taiwan Life is expected to maintain a 125 percent solvency ratio under the new accounting rules next year, company officials said.
While the US Federal Reserve is tilting toward rate cuts, Kao said that trade uncertainties and market swings require careful management to safeguard investments.
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