Despite ongoing protests, Hong Kong will remain Asia’s financial hub and CTBC Financial Holding Co’s (中信金控) most important base for Taiwanese companies operating in China, president Daniel Wu (吳一揆) said yesterday.
The Hong Kong branch of the company’s banking arm, CTBC Bank (中國信託銀行), has so far been little affected by the protest, Wu told an investors’ conference in Taipei.
While some protesters on Sunday issued a call on Facebook for all Hong Kongers to withdraw their money and exchange it for US dollars, it would have little adverse impact on CTBC, which mainly deals with corporate clients, and 80 percent of their deposits are denominated in US dollars, Wu said.
“We did get some calls inquiring if it was still safe to park money in Hong Kong, but so far no client has moved their money out,” CTBC Financial head of financial management Chiu Ya-ling (邱雅玲) said.
The company has no plan to shift its focus from Hong Kong to Singapore, as many China-bound Taiwanese firms still view the territory as their base for fund management or financial support, Wu said
However, Hong Kong’s financial status in Asia might be threatened if the demonstrations, which have lasted for 10 weeks, continue, he said.
CTBC Financial posted a first-half net profit of NT$20.39 billion (US$647.18 million), down 6.9 percent annually due to lower investment returns, higher hedging costs and bad-debt expenses, Chiu said.
However, the company’s credit-card business saw net fee income expand 16.3 percent to NT$1.3 billion, as its cutting of rewards for cobranded Line Pay credit cards failed to affect cardholders’ spending, she said.
The company expects earnings growth in the second half, supported by the repatriation of funds from abroad, which is expected to generate NT$10 billion in wealth management fee income per year, she added.
Asked about recent interest rate cuts in India, New Zealand and Thailand, CTBC chief economist Jeff Lin (林建甫) said that Taiwan’s central bank is expected to maintain current rates if the full-year GDP growth could stay above 2 percent.