CDF 2019 Earnings Up 64% YoY to 13-Year High of NT$12.84bn, for EPS of NT$0.88

Jan 9, 2020
China Development Financial (hereinafter CDF) announced today (January 9) that its December preliminary net profit was NT$1.092bn and that 2019 net profit totaled NT$12.849bn, translating to EPS of NT$0.88. According to CDF, 2019 earnings grew 64% YoY to the highest level in nearly 13 years, indicating stable and balanced development of the four profit engines of banking, securities, venture capital and insurance. The Company will continue to strengthen its subsidiaries’ competitiveness as well as product development and sales capabilities, while deepening customer relations and scale, in order to enhance stable long-term profitability.

KGI Bank saw stable contribution from net interest spread, fee income and financial trading in December, with monthly net profit of NT$267mn, taking 2019 net profit to NT$3.606bn, up 68% YoY. The bank launched a consumer-friendly new Open Banking experience at physical branches that utilizes digital technology with streamlined internal processes. It also rolled out an instant revolving credit loan plan and a personal credit program jointly with Taiwan Star Telecom at year end, in hopes of bringing a new experience to customers.

Driven by profit contribution from brokerage, bond and underwriting businesses, KGI Securities posted December net profit of NT$570mn, and 2019 net profit of NT$6.062bn, up 61% YoY. KGI Securities continued to develop its wealth management business, which generates fee income, while its bond, investment banking and derivatives products businesses also made marked improvements in terms of profit. Aside from growth in Taiwan, overseas subsidiaries in Hong Kong, Indonesia and Thailand contributed 20% of overall profit. KGI Securities will continue with its internationalization strategy and maintain its leadership as a regional brokerage in Asia. In 2019, KGI Securities Investment Trust had NT$172.9bn in assets under management, up 438% YoY.

Supported by earnings momentum from rebounding valuations of investment positions, CDIB Capital posted December net profit of NT$361mn and 2019 net profit of NT$2.278bn, roughly flat YoY. Continuing with its push for asset management business, CDIB Capital completed fundraising for CDIB Yida Healthcare Private Equity Fund (denominated in RMB) in 2019, with NT$39.8bn in assets under management.

China Life posted a December net loss of NT$502mn due to heavy financial pressure from policy provisions, taking 2019 net profit to NT$13.598bn. The insurer’s total assets exceeded NT$2tn at end-December. Under the global FinTech trend, China Life continued to innovate, boldly deploying technological methods in various scenarios, and launching big data precision marketing and AI technology. In response to the growing expectations of industry authorities for innovation, China Life led peers in trial operations of ID certification procedures for mobile insurance, with FSC (Financial Supervisory Commission) approval. With the use of facial recognition technology in the insurance purchase process, China Life has entered a new era in the insurance industry ahead of industry peers.

CDF spokesperson Richard Chang noted that last year, in order to lead the business forward, CDF reshuffled key executive staff so as to meet its strategic needs, and recruited professional personnel of international caliber into the management team. These personnel include Amy Tsao as new President of KGI Bank, Osama S. Abbasi as new Vice Chairman and Interim President of KGI Securities, Angelo Koo as new Chairman of CDIB Capital Group, and William Ho as new President of CDIB Capital Group.

In 2020, CDF will actively promote corporate governance and sustainable development and fully incorporate ESG issues into its investment analysis and decision-making processes. Going forward, CDF will focus on overseas deployment and acceleration of internationalization as its business development strategies, which it expects will support a new wave of growth.
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