SinoPac Financial Holdings Co (永豐金控) is reviewing its lending operations to improve internal oversight after a spate of questionable loans led to heavy fines and a management reshuffle, senior executives said yesterday.
“We are re-examining credit applications to make sure they all meet regulatory requirements... The probe by the Financial Supervisory Commission will show if the company is guilty of compliance failure,” SinoPac Financial chief investment officer Eric Chuang (莊銘福) said on the sidelines of the inauguration of a new Bank SinoPac (永豐銀行) branch in Hualien.
The probe came after a tip-off from the group’s employees that affiliated SinoPac Leasing Corp (永豐金租賃) granted a US$1.35 million (NT$4.22 billion) loan to J&R Trading Co, a foreign shell company owned by Sun Power Development and Construction Co (三寶建設) and with investment from papermaking conglomerate YFY Inc (永豐餘控股) and E Ink Holdings Co (元太科技).
Both YFY and E Ink are affiliates of SinoPac Financial, raising ethical and legal concerns over the loan, especially in the absence of sufficient collateral, local media cited the employee as saying.
SinoPac Financial denied the accusation, saying the leasing unit secured equities and subordinate claims on real estate as collateral that are estimated to be worth 85 percent of the loan.
The borrower carried out the financing through a foreign company as is standard practice for Taiwanese firms based in China, SinoPac Financial said.
Unlike banks, leasing firms cannot demand the use of land as collateral in China and the group decided to classify the loan as “unsecured” to meet tighter standards, SinoPac Financial said.
“The company should emerge from the probe unscathed,” Chuang said.
Last month, Bank SinoPac, the main subsidiary of SinoPac Financial, incurred a fine of NT$10 million for loans paid to Taipei-based dentistry supplier Tingsing Trading Co (鼎興貿易).
The dentistry supplier allegedly bilked NT$3.78 billion from 13 lenders, including Bank SinoPac, because it is owned by an in-law of a former Bank SinoPac director, prosecutors said.
SinoPac Financial reshuffled its top management positions after the fine.
Acting Bank SinoPac president Philip Wei (魏哲弘), whose appointment is awaiting regulatory approval, said he and his colleagues are sorting out their connections because many people do not know their distant relatives, whose conduct could have legal implications in their profession.
Ho Shou-chuan (何壽川), the patriarch at SinoPac Financial, YFY, E Ink and other businesses, has adopted a strict approach to deal with family and friends, Wei said.
A review of all loans in excess of NT$100 million is being undertaken, officials said.
The Hualien branch is intended to deepen the lender’s presence in the east of the nation, where customers prefer traditional human contact to online transactions, Bank SinoPac said.
VALUE: TSMC’s market capitalization far exceeds the combined size of all the Latin American companies on MSCI Inc’s benchmark for emerging markets Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) US$420 billion equity rally this year would get a valuation test this week when it reports earnings, with analysts expecting the chipmaker to raise full-year sales forecasts. The world’s biggest contract chipmaker would probably report a 29 percent increase in second-quarter net income on Thursday, according to the median estimate of analysts surveyed by Bloomberg. More importantly, analysts from JPMorgan Chase & Co to Morgan Stanley expect it to also raise its full-year sales guidance, justifying another round of valuation expansion. Just like Nvidia Corp, TSMC has become a favorite artificial intelligence (AI)-bet for investors with
ASSASSINATION ATTEMPT: The previous shooting targeting a US president or major party candidate was the 1981 incident targeting then-US president Ronald Reagan Saturday’s shooting at former US president Donald Trump’s election rally raises his odds of winning back the White House, and trades betting on his victory would increase this coming week, investors said yesterday. Trump was shot in the ear during the rally in Pennsylvania on Saturday in what the authorities were treating as an assassination attempt. Trump, his face spattered with blood, pumped his fist moments after the attack, and his campaign said he was fine after the incident. Before the shooting, markets had reacted to the prospect of a Trump presidency by pushing the US dollar higher and positioning for a
EXPECTATIONS: The firm, which is on track to outpace global foundry industry revenue growth, said it expects constrained advanced process capacity amid stronger AI demand Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday increased its projected revenue growth for this year to above 25 percent, as stronger-than-expected demand for premium smartphones and artificial intelligence (AI) devices are to drive greater utilization of cutting-edge 3-nanometer and 5-nanometer chips. In April TSMC estimated 21 to 24 percent annual growth. The firm’s revenue growth is on track to greatly outpace the global foundry industry, which is expected to rise about 10 percent this year. “Over the past three months, we have observed stronger AI and high-end smartphone demand from our customers, which is to boost the overall capacity utilization for our leading-edge
INVESTMENT: The company’s planned complex in Texas would be the first 12-inch silicon wafer fab built in the US in more than 20 years, a GlobalWafers official said GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said it secured up to US$400 million in direct funding from the US Department of Commerce under the CHIPS and Science Act for the construction of two new advanced fabs in the US. Its subsidiaries GlobalWafers America and MEMC LLC are to build a 12-inch silicon wafer fab in Sherman, Texas, and another one in Missouri to produce silicon-on-insulator (SOI) wafers used to make leading-edge chips. “With the support of the [US President Joe] Biden Administration, we are honored to be bringing to American shores the world’s most cutting-edge 12-inch semiconductor