Taiwan’s State-run Mega Financial Holding Co and First Financial Holding Co said that they are aiming for stable profit growth in 2022, despite lingering uncertainties.
Mega Financial said that the operating environment would turn favorable for financial institutions in 2022 after major central banks worldwide disclosed plans to raise interest rates, which would widen interest spreads and profit margins.
The US Federal Reserve in January 2022 said that it would raise interest rates by 25 basis points as early as March and shrink the central bank’s balance sheet to help contain inflation. Interest rate hikes would allow Mega Financial to better use its funds and assets and pursue better returns, even though the COVID-19 pandemic and supply chain disruptions would liger, it said.
Mega Financial chairman Michael Chang urged his colleagues to meet the growth challenges by embracing change. The company’s banking arm, Mega International Commercial Bank, has embarked on a transformation process that could take time to bear fruit, Chang said.
Additionally, the bank’s credit card business is now making a profit and its number of cards in circulation has risen above the 1 million mark after three years of effort, he added. Mega Bank president Robert Tsai said that the Fed could raise interest rates three to five times in 2022, which would benefit the Taiwanese lender’s operations.
First Financial Holding said that it is seeking to bolster its operating resiliency and raise profit contributions from non-bank subsidiaries.
First Financial chairwoman Chiou Ye-chin said that the state-run conglomerate would assign more importance to environment protection, in line with global efforts to cut carbon emissions.
Its main subsidiary, First Commercial Bank, said that it would deepen relationships with customers and offer wealth management tools that suit their needs.
The lender added that it would make its online banking platform more user-friendly to improve customer service.