(TAIPEI) Shin Kong Financial Holding (SKFH) convened an annual general shareholders’ meeting today (June 18), presided by Chairman Eugene Tung Chin Wu. The meeting resolved to recognize SKFH's 2009 audited financial statements and supervisors’ review of 2009 audited financial statements.
Through capital strengthening and risk management, SKFH’s overall performance improved in 2009. It posted a consolidated pre-tax profit of NT$3.94 billion and after-tax profit of NT$1.13 billion, or NT$0.17 per share. Consolidated total assets increased by 9.3% to reach NT$1.9 trillion.
In order to build a sustainable operation, Shin Kong Life Insurance (SKL) adjusted its sales strategy to focus on profit and embedded value contribution. In 2009, first year premium (FYP) from high-margin traditional products surged 121.7% and accounted for 37.9% of the total FYP year-on-year of NT$68.19 billion for the year. New business margin rose year-on-year, with large gains in new business value. Embedded value reached NT$110.1 billion in 2009, up 36.4% from last year, while actuarial value (20 years new business) reached NT$220.7 billion, up 37.1% year-on-year, representing an actuarial value per share of NT$28.0.
In 2009, Shin Kong Bank (SKB) had a loan balance of NT$287.03 billion, similar to 2008. Asset quality continued to improve. As of the end of May 2010, the bank's non-performing loan (NPL) ratio was 1.09%, and its coverage ratio was 105.35%. Provision expense for 2009 fell by 11.9% compared to the year before. SKB's wealth management business gradually recovered in 2009 as the securities market recovers. Fee income for the year reached NT$670 million, up 23.6% from 2008. The bank also aggressively developed cash management services and increased savings deposits for securities settlement, pushing the ratio of savings deposits to total deposits from 31.6% to 42.3%. SKB had 23,300 Visa Infinite Cards in circulation, the most of any bank in Taiwan and well ahead of the number two issuer (7,800 cards). Average monthly consumption on these cards was over NT$30,000. SKB recorded an after-tax profit of NT$560 million in 2009 and its profits are expected to grow steadily in the future.
In order to further integrate securities resources and better utilize funds, Shin Kong Securities merged with MasterLink Securities (MasterLink) in 2009. Post merger, MasterLink's share of the domestic brokerage market jumped from No. 10 to No. 5. SKFH will continue to strengthen business cooperation and resource sharing with MasterLink in order to provide better and more comprehensive financial services to customers of the two companies.
Shin Kong & HNA Life Insurance, a joint venture between SKL and HNA Group in China, began operations in 2009. In the initial period, the company took advantage of market opportunities to enter into collaboration agreements with Shanghai Pudong Development Bank, Industrial and Commercial Bank of China, Hainan Airlines and other large enterprises. The company also focused on business quality and service innovation, such as launching the first "Policy Number Selection" service. In May 2010, Shin Kong & HNA Life Insurance received approval from the China Insurance Regulatory Commission (CIRC) to establish a branch in Hainan Province. In the same month, CIRC also approved the opening of the company's Chaoyang branch in the Beijing area. In future, Shin Kong & HNA Life Insurance will actively expand and develop in the vast Mainland market.
Looking ahead, in addition to closely monitoring developments in the global economy, SKFH will actively pursue growth of core business and strengthen profitability, strictly control costs, drive synergies among subsidiaries, enhance risk management, strengthen customer services, and collaborate with our partner to successfully operate the insurance joint venture in China. SKFH will faithfully implement its operating plans and fully utilize its existing advantages to capture future opportunities and create value for its shareholders.