Latest news with #CathayUnitedBank
Yahoo
26-05-2025
- Business
- Yahoo
Cathay Financial Holding Co Ltd (TPE:2882) Q1 2025 Earnings Call Highlights: Strong Growth in ...
Net Income: TWD32 billion for Q4 2025; TWD32.2 billion for Q1 2025. Return on Equity (ROE): 14.4% for Q4 2025. Earnings Per Share (EPS): TWD2.18 for Q1 2025. Cathay United Bank Earnings Growth: 17% year-on-year for Q1 2025. Net Interest Income Growth: 18% year-on-year for Q1 2025. Net Fee Income Growth: 33% year-on-year for Q1 2025. Wealth Management Fee Growth: 46% year-on-year for Q1 2025. Credit Card Fee Growth: 14% year-on-year for Q1 2025. Cathay Life Total Premium Growth: 24% year-on-year to TWD134 billion for Q1 2025. First Year Premium (FYP): TWD55 billion, doubled year-on-year for Q1 2025. Value of New Business (VNB): TWD9.4 billion, up 9% year-on-year for Q1 2025. Investment Yield: 4% after hedging for Q1 2025. Asset Management AUM: TWD2.2 trillion for Q1 2025. Book Value: TWD884 billion for Cathay Financial Holdings, down year-to-date. Book Value Per Share: TWD52.8 for Q1 2025. Embedded Value: TWD1,279 billion for 2024, up 12% year-on-year. Appraisal Value: TWD1.55 trillion for 2024. Warning! GuruFocus has detected 6 Warning Sign with TPE:2882. Release Date: May 23, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Cathay Financial Holding Co Ltd (TPE:2882) delivered solid results in the fourth quarter with net income reaching TWD32 billion and ROE at 14.4%. Cathay United Bank reported a 17% year-on-year growth in earnings, supported by double-digit growth in loans, net income, and net interest income. Cathay Century, the P&C insurance subsidiary, achieved a 21% year-on-year increase in net income, maintaining solid underwriting profitability. Cathay SITE, the asset management subsidiary, posted a 20% year-on-year earnings growth and continued to receive strong market recognition. The company's capital position remained robust despite recent currency fluctuations, providing a solid buffer against financial market volatility. Cathay Life's earnings declined year-on-year due to a high base of capital gain in the same period of last year. The consolidated book value of the holding company was down year-to-date, reflecting lower mark-to-market value of financial assets amid stock market corrections. The equity-to-asset ratio stood at 8.5%, indicating a decrease in book value due to equity market corrections. The cost of liability rose slightly due to the declared rate increase for interest-sensitive policies. Cathay Life's book value was down year-to-date, reflecting equity market corrections, which could impact future financial stability. Q: How does Cathay Financial manage the impact of Taiwan dollar appreciation on its life business? A: Grace Chen, CFO, explained that Cathay Financial employs a dynamic hedging strategy using traditional hedging tools, currency swaps, NDFs, and proxy hedging with a basket of currencies correlated with the Taiwan dollar. This strategy effectively mitigates earnings impact despite short-term volatility. The FX volatility reserve offsets 60% of currency impact, and an application to adopt a new reserve mechanism could increase this to 100%. The company's strong capital position provides resilience against further volatility. Q: What is the impact of U.S. tariffs and market volatility on Cathay's banking and life insurance businesses? A: Grace Chen noted that the banking business showed strong momentum, maintaining targets for high single-digit loan growth and fee income growth. For life insurance, Cathay increased cash positions to enhance flexibility and focused on aligning assets with liabilities. The company is well-prepared for IFRS 17 and ICS adoption, with a strategy prioritizing value-driven growth. Q: How does Cathay United Bank manage risks associated with wealth management clients pledging Taiwan dollar assets to buy U.S. dollar products? A: Hsing-Hsien Hu, Senior EVP, stated that the pledge portfolio is not a major part of the business, with a healthy loan-to-value ratio of 50%. Investment revenue is driven by market performance rather than hedging strategies. The bank maintains a healthy portfolio and targets high single-digit growth in wealth management fees. Q: What is Cathay Life's approach if the FX reserve is fully depleted due to Taiwan dollar appreciation? A: Chang-Ken Lee, CEO, expressed confidence in the hedging strategy's effectiveness, noting that the Taiwan dollar's recent appreciation was temporary. The company does not foresee structural changes in currency movements and believes the FX reserve will not be depleted. The hedging strategy remains effective, with no significant impact expected on earnings or capital. Q: What is the single rate equivalent for the value of new business in 2024? A: Chang-Ken Lee stated that the equivalent investment rate for new business in 2024 is around 4.7%, up from 4.62% in 2023. This includes both Taiwan dollar and U.S. dollar new business. Q: How much can Cathay leverage proxy hedging in its risk management strategy? A: Shu-Fen Cheng, Senior EVP, explained that proxy hedging typically ranges from 10% to 30% of the hedging strategy. The company adjusts the mix based on currency movements and risk-reward judgments, maintaining flexibility to manage currency volatility effectively. Q: How does Cathay United Bank's deposit growth compare to peers, and what strategies are in place? A: Shu-Fen Cheng highlighted that Cathay United Bank's deposit growth has outperformed key peers for the past seven years, driven by a strong brand and enhanced corporate services. The bank focuses on attracting retail and corporate deposits without over-leveraging client assets. Q: What are the historical hedging costs for Cathay Life, and how effective is the proxy hedging strategy? A: Shu-Fen Cheng noted that Cathay Life's hedging costs have been contained within 1% to 1.5% in most years, with proxy hedging effectively minimizing costs. The strategy leverages currency correlations and has proven effective over the past 14 years, with only two years exceeding the cost benchmark. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
26-05-2025
- Business
- Yahoo
Cathay Financial Holding Co Ltd (TPE:2882) Q1 2025 Earnings Call Highlights: Strong Growth in ...
Net Income: TWD32 billion for Q4 2025; TWD32.2 billion for Q1 2025. Return on Equity (ROE): 14.4% for Q4 2025. Earnings Per Share (EPS): TWD2.18 for Q1 2025. Cathay United Bank Earnings Growth: 17% year-on-year for Q1 2025. Net Interest Income Growth: 18% year-on-year for Q1 2025. Net Fee Income Growth: 33% year-on-year for Q1 2025. Wealth Management Fee Growth: 46% year-on-year for Q1 2025. Credit Card Fee Growth: 14% year-on-year for Q1 2025. Cathay Life Total Premium Growth: 24% year-on-year to TWD134 billion for Q1 2025. First Year Premium (FYP): TWD55 billion, doubled year-on-year for Q1 2025. Value of New Business (VNB): TWD9.4 billion, up 9% year-on-year for Q1 2025. Investment Yield: 4% after hedging for Q1 2025. Asset Management AUM: TWD2.2 trillion for Q1 2025. Book Value: TWD884 billion for Cathay Financial Holdings, down year-to-date. Book Value Per Share: TWD52.8 for Q1 2025. Embedded Value: TWD1,279 billion for 2024, up 12% year-on-year. Appraisal Value: TWD1.55 trillion for 2024. Warning! GuruFocus has detected 6 Warning Sign with TPE:2882. Release Date: May 23, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Cathay Financial Holding Co Ltd (TPE:2882) delivered solid results in the fourth quarter with net income reaching TWD32 billion and ROE at 14.4%. Cathay United Bank reported a 17% year-on-year growth in earnings, supported by double-digit growth in loans, net income, and net interest income. Cathay Century, the P&C insurance subsidiary, achieved a 21% year-on-year increase in net income, maintaining solid underwriting profitability. Cathay SITE, the asset management subsidiary, posted a 20% year-on-year earnings growth and continued to receive strong market recognition. The company's capital position remained robust despite recent currency fluctuations, providing a solid buffer against financial market volatility. Cathay Life's earnings declined year-on-year due to a high base of capital gain in the same period of last year. The consolidated book value of the holding company was down year-to-date, reflecting lower mark-to-market value of financial assets amid stock market corrections. The equity-to-asset ratio stood at 8.5%, indicating a decrease in book value due to equity market corrections. The cost of liability rose slightly due to the declared rate increase for interest-sensitive policies. Cathay Life's book value was down year-to-date, reflecting equity market corrections, which could impact future financial stability. Q: How does Cathay Financial manage the impact of Taiwan dollar appreciation on its life business? A: Grace Chen, CFO, explained that Cathay Financial employs a dynamic hedging strategy using traditional hedging tools, currency swaps, NDFs, and proxy hedging with a basket of currencies correlated with the Taiwan dollar. This strategy effectively mitigates earnings impact despite short-term volatility. The FX volatility reserve offsets 60% of currency impact, and an application to adopt a new reserve mechanism could increase this to 100%. The company's strong capital position provides resilience against further volatility. Q: What is the impact of U.S. tariffs and market volatility on Cathay's banking and life insurance businesses? A: Grace Chen noted that the banking business showed strong momentum, maintaining targets for high single-digit loan growth and fee income growth. For life insurance, Cathay increased cash positions to enhance flexibility and focused on aligning assets with liabilities. The company is well-prepared for IFRS 17 and ICS adoption, with a strategy prioritizing value-driven growth. Q: How does Cathay United Bank manage risks associated with wealth management clients pledging Taiwan dollar assets to buy U.S. dollar products? A: Hsing-Hsien Hu, Senior EVP, stated that the pledge portfolio is not a major part of the business, with a healthy loan-to-value ratio of 50%. Investment revenue is driven by market performance rather than hedging strategies. The bank maintains a healthy portfolio and targets high single-digit growth in wealth management fees. Q: What is Cathay Life's approach if the FX reserve is fully depleted due to Taiwan dollar appreciation? A: Chang-Ken Lee, CEO, expressed confidence in the hedging strategy's effectiveness, noting that the Taiwan dollar's recent appreciation was temporary. The company does not foresee structural changes in currency movements and believes the FX reserve will not be depleted. The hedging strategy remains effective, with no significant impact expected on earnings or capital. Q: What is the single rate equivalent for the value of new business in 2024? A: Chang-Ken Lee stated that the equivalent investment rate for new business in 2024 is around 4.7%, up from 4.62% in 2023. This includes both Taiwan dollar and U.S. dollar new business. Q: How much can Cathay leverage proxy hedging in its risk management strategy? A: Shu-Fen Cheng, Senior EVP, explained that proxy hedging typically ranges from 10% to 30% of the hedging strategy. The company adjusts the mix based on currency movements and risk-reward judgments, maintaining flexibility to manage currency volatility effectively. Q: How does Cathay United Bank's deposit growth compare to peers, and what strategies are in place? A: Shu-Fen Cheng highlighted that Cathay United Bank's deposit growth has outperformed key peers for the past seven years, driven by a strong brand and enhanced corporate services. The bank focuses on attracting retail and corporate deposits without over-leveraging client assets. Q: What are the historical hedging costs for Cathay Life, and how effective is the proxy hedging strategy? A: Shu-Fen Cheng noted that Cathay Life's hedging costs have been contained within 1% to 1.5% in most years, with proxy hedging effectively minimizing costs. The strategy leverages currency correlations and has proven effective over the past 14 years, with only two years exceeding the cost benchmark. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
14-05-2025
- Business
- Yahoo
Cathay United Bank Ho Chi Minh City Branch Hosts ESG Seminar: A "Key" to Unlock Sustainable Development
TAIPEI, May 14, 2025 /PRNewswire/ -- Cathay United Bank (CUB) marked its 20th anniversary in Vietnam by launching a year-long celebration with a landmark ESG seminar, bringing together over 80 industry leaders to chart a course for sustainable development among businesses in Vietnam. Focusing on ESG: Global Trends and Local Challenges In a bold demonstration of its commitment to sustainability and innovation, Cathay United Bank Ho Chi Minh City Branch (CUBHCM) celebrated its 20th anniversary under the theme "Better Together" by hosting the seminar "ESG: Challenges and Practices for Sustainable Development." As Environmental, Social, and Governance (ESG) criteria increasingly influence global business strategy, the event provided key industry stakeholders with practical insights and strategic guidance to navigate the evolving sustainability landscape. As a commercial bank under Cathay Financial Holdings – one of Asia's leading financial institutions – CUB not only provides financial services but also actively serves as a key partner for businesses transitioning towards sustainability. In 2015, CUB became the first Taiwanese bank to adopt the Equator Principles, ensuring its financed projects align with international environmental and social risk management standards, laying a solid foundation for supporting sustainable development in business. Mr. Michael Wen, Executive Vice President of Cathay United Bank, emphasized at the seminar, "Cathay United Bank aims to support our clients in navigating the evolving ESG landscape by providing insights into global and local trends, regulatory developments, and practical implementation approaches, empowering businesses. Vietnam's rapid economic growth presents both opportunities and challenges in sustainability, and collaboration between businesses, financial institutions, and policymakers is key to driving meaningful change." During the forum, Mr. Nguyễn Hoàng Nam, ESG Leader at PwC Vietnam, highlighted the challenges many domestic small and medium-sized enterprises (SMEs) face regarding ESG: "Approximately 39% of businesses have never heard of ESG, and over 60% are unaware of relevant regulations. Key barriers include financial constraints, a lack of clear legal guidance, and limited ESG implementation capacity." To address these challenges, Mr. Nguyễn Hoàng Nam advised that businesses to invest in internal ESG training, develop reliable reporting data systems, proactively seek green finance partners, and engage with industry associations to learn best practices. Practical Models and Industry Best Practices Despite the challenges, ESG implementation in Vietnam has seen encouraging progress. At the policy level, the Vietnamese Government has issued the Green Growth Strategy for 2021–2030. The forum also featured representatives from leading companies in ESG execution and certification, including IDICO Industrial Park, Schneider Electric, Ares International Certification, Dan-D Foods, and Micro Electricity . For instance, IDICO Industrial Park has introduced greener practices in heavy industry. It has installed rooftop solar systems across pre-built factories and reused wastewater. IDICO also prioritises human capital by developing convenient social housing, attracting quality workers. Meanwhile, Schneider Electric, with a Net Zero target by 2050, is actively developing clean technologies such as clean electricity and grid decarbonization to reduce its carbon footprint. Cathay United Bank : Partnering with Vietnamese Businesses for Sustainability By 2024, CUB had earned nearly 90 prestigious awards recognising achievements in asset management, digital innovation, and ESG practices—a testament to its position as a responsible and forward-thinking bank. Most recently, Cathay United Bank ranked in the top 20% of the Financial Supervisory Commission's sustainable finance ratings. Guided by its vision, positioning Vietnam as "second home," CUB has taken significant steps in the recent years to promote ESG development across the country. Notably, the branch partnered with the Asian Development Bank (ADB) to finance Vietnam's largest onshore wind power project in Ninh Thuận province, with a total investment of USD 107 million. Furthermore, the Cathay United Bank Ho Chi Minh City Branch has launched a green loan programme in the form of CAPEX financing to support Vietnamese companies in developing sustainable, eco-friendly projects. The first phase factories under this initiative were the first in Northern Vietnam to receive the international LEED green building certification. Mr. VJ Lu, the General Manager of CUB Ho Chi Minh City Branch stated, "Throughout today's seminar, we've looked at real challenges and practical solutions for ESG and sustainable development. Whether it was energy transition, strategy, or real business stories—it all comes down to one thing: working together. Collaboration really is key if we want to drive long-term change." As the opening event of CUB's 20 years anniversary celebration in Vietnam, this seminar underscores the bank's commitment to connecting people, ideas, and solutions. Embracing the message "Better Together", CUB affirms that ESG is not a solitary path, but a shared responsibility requiring collaboration across the enterprise–finance–community ecosystem to move further, together. 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South China Morning Post
08-05-2025
- Business
- South China Morning Post
Taiwan's Cathay United Bank charts path to regional leadership
[The content of this article has been produced by our advertising partner.] Advertisement Cathay United Bank, a subsidiary of Taiwan's largest financial group, Cathay Financial Holdings, is undergoing a bold transformation from a domestic bank into a fully-fledged regional bank, with Southeast Asia in its sights and Hong Kong at the heart of its expansion strategy. The bank's regional ambitions were highlighted by Andrew Kuo, Chairman of Cathay United Bank, in January, following a record post-tax profit. He pledged to ramp up overseas investment, expand customer-centric services across markets and drive diversification. "That's our target," echoed Benny Miao, Executive Vice President at Cathay United Bank. "We're already present in most of Asia, and now it's about deepening our presence, ensuring we remain relevant and meaningful to our clients, and expanding further based on their evolving needs." The move reflects Cathay United Bank's broader ambition to expand its cross-border banking capabilities by tapping into the ASEAN markets and leveraging Hong Kong's financial infrastructure and talent pool. Advertisement Cathay United Bank currently operates in 11 Asian markets, including Cambodia, Vietnam, Laos, Myanmar and Singapore. Its latest expansion plan into Mumbai was approved by the island's regulator in March, bringing its total offshore locations to 68. "The expansion is not just about planting flags," Miao said. "It's about going where our clients are or where they're heading. If I'm not there, and my client is, I can't serve them. We have to think far enough ahead and make strategic decisions accordingly."
Yahoo
06-05-2025
- Business
- Yahoo
Dollar's Decline Is Fueling Dislocations Across Asian FX
(Bloomberg) -- Asian currencies ripped higher against the US dollar Monday, extending a move that's hurting exporters, weighing on equities and forcing central banks to intervene in the market to curb excessive gains. Most Read from Bloomberg Taiwan's dollar surged the most since 1988, sending the nation's benchmark stock index to its steepest slide in nearly a month. The offshore yuan climbed to its highest level in almost six months as exporters repatriated dollar earnings. The Hong Kong dollar held at the strong end of its allowed trading band for a second session. Meanwhile, the Indonesian rupiah recouped most of this year's losses after slumping to a record low less than a month ago. The volatility shows how an exodus from the world's reserve currency can ripple through financial markets, as President Donald Trump's shifting tariff policies fuel concern over a US recession. Last week, speculative traders became more bearish on the dollar than at any time since September, in a sign of growing reluctance among investors to hold US assets. Asian currencies including the yen and yuan are benefiting from a mix of repatriation buying and as alternative investments amid the 'sell America' wave. The strategy appeared to remain intact even as both Beijing and Washington seemed to be softening their stance on the trade war, with President Trump at the weekend signaling he's open to reducing import duties on Chinese goods to spur trade. 'The natural way out of a lot of this trade tension is via the dollar balloon deflating,' said Brad Bechtel, global head of foreign exchange at Jefferies. Therefore, 'loading up on a little downside for dollar versus Asia might make sense.' Asia's foreign-exchange market has seen wild swings the past two days, with a Bloomberg gauge of the region's currencies surging the most since 2022 on Friday, while an indicator for returns of emerging-markets foreign-exchange closed at an all-time high. Moves extend on early Monday trading, with the Asia Dollar Index at its highest in six months. Strength in emerging market currencies can help attract foreign inflows and make its imports cheaper, but it can hurt exporters by making their goods less competitive globally. Exporters' Selling Taiwan dollar jumped about 5% on Monday, leading a two-day rally in regional currencies. The gain was driven by speculation that exporters and retailers were aggressively selling the greenback, betting on further declines. The surge in currency exchange requests prompted Cathay United Bank to place controls on its trading platform.
