Hua Nan Financial Reports Record First-Nine-Month Earnings, Nearing Full-Year Profit

Table of Contents

• You might want to know
• Main Topic
• Key Insights Table
• Afterwards...

You might want to know

• How close did Hua Nan Financial come to matching its full-year profit after just the first 3 quarters?
• Which business lines contributed most to the group’s stronger and more balanced earnings mix?

Main Topic

Hua Nan Financial Holdings (華南金控, 2880-TW) reported its unaudited earnings on the 13th, announcing after-tax net profit of NT$26.367 billion for the first 3 quarters. That represented year-on-year growth of 32.4%. Earnings per share (EPS) reached NT$1.88, while annualized return on equity (ROE) rose to 14.38%. The group said these financial measures all reached record highs for the same period in its history. The earnings increase reflected steady performance at its banking subsidiary alongside a substantial improvement in profits from non-bank subsidiaries, giving the group two sources of growth and supporting expectations for a new full-year earnings record.

September alone generated after-tax net profit of NT$2.345 billion. The first-3-quarter total of NT$26.367 billion was already close to the NT$26.42 billion earned during the previous full year. The comparison highlights the pace of earnings accumulated so far, though actual full-year results will depend on business conditions during the remaining period.

The group’s earnings mix also shifted. Banking subsidiary profits increased by NT$2.43 billion year on year, up 13.1%, and accounted for 77% of group profit. Non-bank businesses—including securities, property and casualty insurance, venture capital, asset management, and investment trust operations—recorded combined year-on-year growth of NT$4.034 billion, or 170%. Their share of cumulative group profit rose to 23% from 11% in the same period last year, an increase of 12 percentage points. Hua Nan Financial characterized this broader contribution as a more balanced and resilient earnings structure.

Hua Nan Bank (華南銀行), the group’s principal banking subsidiary, posted September after-tax net profit of NT$1.996 billion. Its cumulative after-tax net profit for the first 3 quarters totaled NT$20.987 billion, up 13.1% year on year, maintaining a steady growth trend. September profit declined from August. The company attributed the decrease mainly to lower dividend income as the peak dividend season came to an end, as well as the effect of Federal Reserve rate hikes on foreign-exchange conversion gains from existing SWAP (currency swap) positions. It said returns on newly booked SWAP transactions had improved and that financial trading income could recover in the 4th quarter.

The bank reported growth across its three main sources of income: interest, fees, and financial operations. Changes to its loan and deposit mix began to produce results, and lending expanded by NT$169.3 billion in the 3rd quarter compared with the prior quarter, a quarterly increase of 7%. Net interest margin (NIM) improved by 5bps at the same time, helping net interest income rise 12% year on year. Flexible financial investment and trading strategies contributed to a 3% increase in net investment income.

Wealth management was another significant growth area. Supported by mutual funds, insurance, and foreign bonds, wealth-management business increased 32%. Total net fee income consequently exceeded NT$13.8 billion, up 29% year on year. Together, these results show how lending growth, improved margins, investment activity, and fee-generating services contributed to the bank’s first-3-quarter performance.

Overseas operations also became a stronger contributor. Hua Nan Bank’s Offshore Banking Unit (OBU) and overseas branches earned NT$4.37 billion in the first 3 quarters, up 34% year on year and equal to 21% of the bank’s after-tax net profit. OBU branch profit rose 126%. The bank said it would continue using its overseas branches and OBU to provide end-to-end international financial services as Taiwanese businesses reorganize global supply chains. The stated aim is to deepen its overseas business presence and expand the contribution of international operations.

Hua Nan Securities (華南永昌證券) and Hua Nan Property Insurance (華南產險) also reported strong results. Hua Nan Securities earned NT$263 million after tax in September and NT$4.248 billion in the first 3 quarters, a year-on-year increase of 215%. Its brokerage, underwriting, and proprietary investment businesses all grew substantially. Brokerage fee income reached NT$6.033 billion, up 110%; underwriting revenue totaled NT$834 million, up 443%; and proprietary investment profit was NT$1.101 billion, up 180%. Activity in overseas sub-brokerage transactions remained strong, with cumulative trading volume exceeding NT$266 billion in the first 3 quarters, an increase of 127% year on year.

Hua Nan Property Insurance generated September after-tax net profit of NT$169 million and first-3-quarter after-tax net profit of NT$1.675 billion, up 32% year on year. Growth in commercial fire and engineering insurance supported the result. An improved loss ratio helped raise underwriting profit, while premiums from online insurance purchases grew 11.82% compared with the same period last year. The company cited this increase as evidence of the benefits of its digital transformation efforts.

Hua Nan Financial Venture Capital (華南金創投) posted September after-tax net profit of NT$52 million. For the first 3 quarters, after-tax net profit reached NT$349 million and EPS was NT$1.74; both figures set records for the same period. The company attributed its performance to realizing gains by selling holdings during a rising stock market, as well as investment portfolio results supported by strong domestic economic and export momentum.

Across the group, Hua Nan Financial Holdings and 4 subsidiaries—banking, securities, property insurance, and venture capital—each recorded first-3-quarter after-tax net profit and EPS at historic highs for the comparable period. Annualized ROE also set records for the financial holding company, securities, property insurance, and venture capital businesses. Taken together, the results reflect contributions from several operating areas and what the company described as efficient use of capital.

The group’s figures point to a combination of scale and diversification: banking remained the largest profit contributor, while non-bank businesses expanded their share considerably. That change may make the overall earnings profile less dependent on a single activity, although each business remains exposed to its own market and operating conditions. For example, securities results can move with market activity, insurance earnings are affected by claims and underwriting conditions, and banking income responds to rates, loan growth, and customer activity.

Hua Nan Financial’s report therefore presents both a record performance to date and a set of business drivers that will shape the rest of the year. Banking profit continued to grow, wealth-management fees increased, and overseas operations contributed a larger amount. At the same time, securities and venture-capital earnings benefited from favorable market conditions, while property insurance cited improvements in its loss ratio and online distribution. The company’s expectation of a new full-year record is based on this combined momentum, but it remains a projection rather than a finalized result.

Key Insights Table

Afterwards...

Hua Nan Financial entered the final quarter with first-3-quarter earnings close to its previous full-year total and with growth distributed across banking and non-bank subsidiaries. The next results will show whether the group can convert that momentum into a new full-year record. Relevant factors include loan and deposit trends, interest margins, market conditions affecting securities and investment gains, insurance underwriting results, and the contribution of overseas operations. The company’s reported figures establish a strong starting point, while the outcome for the full year remains subject to those developments.