Taipei, Dec. 10 (CNA) Fubon Financial Holding Co. Ltd. remained the most profitable firm in the local financial holding sector in the past 11 months, although its bottom line was affected by volatility in the capital market due to the debt problems in the eurozone, market sources said Saturday.
In the 11-month period, Fubon Financial posted NT$32.69 billion (US$1.08 billion) in net profit with earnings per share at NT$3.63, ahead of Chinatrust Financial with NT$1.57, Yuanta Financial with NT$1.5, Mega Financial with NT$1.47, Taishin Financial with NT$1.2 and Cathay Financial with NT$1.13.
Hua Nan Financial trailed the six rivals to take the 7th earner title with EPS of NT$1.12 before First Financial with NT$1.06, Waterland Financial with NT$0.93, Jih Sun Financial with NT$0.75, E. Sun Financial with NT$0.75, Shin Kong Financial with NT$0.64, SinoPac Financial with NT$0.59 and China Development Financial with NT$0.17.
In November alone, Fubon Financial just made NT$5 million in net profit after its life insurance division incurred about NT$800 million in foreign exchange losses and its banking division assigned more than NT$300 million in bad loan provisions.
According to Victor Kung, Fubon Financial's president, while the Taiwan dollar fell against the U.S. dollar last month, the local unit showed its strength against other currencies, including the New Zealand dollar and the Australia dollar, prompting the company to suffer large foreign exchange losses.
Similarly, Cathay Financial and Shin Kong Financial also felt the pinch of the large foreign exchange losses which have squeezed their profitability, the sources said.
On the other hand, Chinatrust Financial, which ranked the second profitable among the financial holding companies in the past 11 months, benefited from synergy arising from the acquisition of New York-based MetLife Inc.'s local unit and posted NT$2.58 billion in net profit in November, the sources said.
In the first 11 months of this year, Chinatrust Financial recorded NT$17.76 billion in net profit, a new high in the company's history.
The market has expected Chinatrust Financial to post NT$20 billion in net profit for 2011 as long as the company continues to keep its momentum in December.
For its part, E. Sun Financial's E.Sun Commercial Bank assigned NT$2.44 billion in bad loan provisions last month, making itself swing to loss in the month to impact its bottom line.
E. Sun Financial, which took 10th place in the ranking, incurred NT$1.49 billion in net loss in November to drag down the accumulated net profit in the 11 month period to NT$3.14 billion.
In addition, Hua Nan Commercial Bank under Hua Nan Financial assigned NT$830 million in bad loan provisions in November, while Bank SinoPac of SinoPac Financial assigned NT$232 million in bad loan provisions in the month.
(By Tien Yu-pin and Frances Huang)