SinoPac ready for renminbi-related businesses after MOU
The China Post news staff
September 6, 2012, 11:36 am TWN
SinoPac Financial Holding is ready for renminbi-related businesses now that both sides of the Strait have signed a currency settlement memorandum of understanding (MOU), said the firm's President Hsiao Tsu-ang yesterday.
Hsiao made the remarks during the financial holding firm's quarterly investors' meeting yesterday.
According to Hsiao, SinoPac's foreign subsidiaries and the firm's overseas business units absorb deposits of about 2.8 billion renminbi, which can be used effectively through lending and investment, for example in mainland Chinese bonds. The company has a deposit-to-lending ratio of over 90 percent.
"It is the hope of local banks that they can replicate Hong Kong's success of offering renminbi-related services, for example the issuance of renminbi bonds and taking renminbi deposits through banks' domestic business units," Hsiao said. "While Hong Kong has opened renminbi-related businesses to people outside the region, its impact on SinoPac is limited."
He pointed out at this stage earnings from the company's renminbi operations account for 10 percent of the total.
"Allowing Taiwan banks to engage in renminbi businesses will facilitate direct financial dealings between both sides and provide support for customers in both Taiwan and China, which are inextricably linked to one another," Hsiao said. "We've already set up various cross-strait cash flow platforms, which can be activated once currency settlement is allowed."
Also during the event, SinoPac Financial reported first-half net profit of NT$4.86 billion, a rise of 46 percent from the same period last year. Subsidiary Bank SinoPac contributed NT$3.988 billion of the total.