Taiwan Cooperative Financial Holding Co (合庫金控) and Hua Nan Financial Holding Co (華南金控) are looking at stable profit growth this quarter, after reporting robust earnings in the first three quarters.
The two state-run bank-focused conglomerates shared cautious optimism with investors amid stable GDP growth at home and rising uncertainty linked to US president-elect Donald Trump’s vow to add tariffs on all imports.
“We aim to grow profit in a stable fashion going forward, as local firms would continue to benefit from the artificial intelligence boom and the world’s economy would gain a bit more momentum next year,” Taiwan Cooperative Financial president Su Tso-cheng (蘇佐政) told an online investors’ conference yesterday, citing the IMF.
Photo: George Tsorng, Taipei Times
However, the US Federal Reserve is likely to slow interest rate cuts, considering healthy economic data and inflation expectations ahead, Su said, adding that the US labor market and private consumption fared resilient.
The US is the world’s largest end market of consumer electronic gadgets whose critical components are made in Taiwan.
Europe and China would put up a lackluster performance amid rising protectionism and geopolitical tensions, Taiwan Cooperative Financial said.
Net income at Taiwan Cooperative Financial picked up 8.24 percent year-on-year to NT$16.23 billion (US$498.7 million) in the first three quarters, or earnings per share of NT$1.04.
Main subsidiary Taiwan Cooperative Bank (合作金庫銀行) generated NT$15.56 billion, suggesting a 10 percent pickup from a year earlier and driving 95.87 percent of overall earnings, company data showed.
Foreign exchange swap gains were about NT$9.2 billion in the first three quarters and would surpass the NT$10 million mark for the whole of this year, the bank said.
The amount could slow next year if the Fed lowers interest rates and narrows the interest gap between the US dollar and the NT dollar, it said.
Its branches in the US and Hong Kong reported active lending activity, compared with China and Cambodia, it said, adding that it remains to be seen if things would improve next year depending on how China’s stimulus measures pan out.
Hua Nan Financial made similar observations on Wednesday, after posting record-high profit of NT$17.5 billion in the first nine months, or earnings per share of NT$1.3.
The company said it is closely monitoring the Trump effect, which has already fueled volatility in bond and foreign exchange markets.
As of yesterday, the NT dollar weakened 1.8 percent against the greenback and the local bourse shed 2.4 percent since the US presidential election on Nov. 5.
Morgan Stanley said recently that stiffer tariffs would shake export-reliant economies such as Taiwan and South Korea harder.
Taiwan’s central bank might cut interest rates next year to support the economy, Hua Nan Financial said.
Hua Nan Financial and Taiwan Cooperative Financial expect their mortgage operations to subdue next year, as a result of central bank’s credit control measures introduced in September.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
RSS