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Securities firms' earnings down nearly 67 percent in March

2012/04/14 19:57:46

Taipei, April 14 (CNA) Securities companies operating in Taiwan witnessed their earnings for March tumble by almost 67 percent from February as the local bourse suffered heavy losses during the month, falling below the 8,000 point mark, the Taiwan Stock Exchange (TWSE) said Saturday.

Last month, 85 securities posted NT$1.75 billion (US$59.3 million) in net profit, down 66.95 percent from February, the TWSE said.

Among them, a total of 57 were profitable but the 28 others incurred losses during the month, the exchange said.

In the integrated securities firm segment, 34 made profits and 14 suffered losses, while among the 36 dedicated securities brokers, 22 were profitable and 14 posted losses.

The only futures commission merchant in Taiwan that remained profitable was Polaris Futures.

Integrated securities firms are allowed to engage in a wide range of activities that includes brokering trades, proprietary trading and underwriting, while securities brokers can only trade equities.

At the end of March, the benchmark weighted index fell 2.32 percent from the end of February to 7,933.00 points as uncertainty over a possible capital gains tax on stock investments prompted many to stay on the sidelines. The tax issue continued having an impact on market fluctuations in the first half of April.

The Ministry of Finance proposed Thursday a 20 percent tax on retail investors who make more than NT$3 million in annual stock gains and a 12 percent tax on domestic institutional investors who earn in excess of NT$500,000.

However, foreign institutional investors will be exempt from the capital gains tax under the proposal which is pending approval from the Cabinet and the Legislature.

The proposal removed market uncertainty to push up the weighted index to close up 1.63 percent at the day's high of 7,788.27 Friday, dealers said.

In March, Yuanta Securities ranked the most profitable integrated securities firm, posting NT$452.73 million in net profit, ahead of Polaris Securities with NT$192.43 million, Capital Securities with NT$167.46 million, Concord International Securities with NT$144.95 million and SinoPac Securities with NT$144.75 million.

In the month, Credit Suisse's Taipei branch posted the highest net profit of NT$95.18 million among the securities brokers, followed by CLSA's Taipei branch with NT$33.09 million, Golden Gate Securities with NT$6.50 million, Yung Chuan Securities with NT$3.52 million and Chin Kang Securities with NT$3.35 million.

In the first three months of this year, the 85 securities firms posted NT$9.81 billion in net profit, according to the TWSE. No comparison figure for the same period of last year was immediately available.

(By Tien Yu-pin and Frances Huang)