Shin Kong Financial (2888) Q3 2024 earnings summary

Executive summary

• Consolidated after-tax profit for the first nine months of 2024 reached NT$19.73bn, with total assets at NT$5.1tn and shareholders' equity up 6.4% quarter-on-quarter to NT$287.54bn; book value per share was NT$16.1.

• Shin Kong Life's profit surged 245.4% year-on-year to NT$11.53bn, Shin Kong Bank's profit grew 5.5% year-on-year to NT$5.50bn, and MasterLink Securities' profit increased 46.6% year-on-year to NT$2.92bn.

• Shareholders approved the merger with Taishin FHC in October 2024.

• Achieved AAA in MSCI ESG rating, DJSI World Index inclusion, and won multiple TCSA and GCSA sustainability awards.

Financial highlights

• First-year premium increased 20.5% year-on-year to NT$36.44bn, with a 6.2% market share; CSM for the first nine months grew 8% year-on-year, with 89% from protection, health, and riders.

• FYPE/FYP ratio at Shin Kong Life was 40.4%, above industry average.

• Total investment portfolio at NT$3.5tn; annualized investment return after hedging rose 88 bps to 3.92% year-on-year.

• Bank loans increased 10.3% year-on-year to NT$848.49bn; net interest income up 8% year-on-year to NT$10.3bn; net fee income up 32.6% to NT$3.3bn.

• MasterLink Securities' operating revenue up 40.7% year-on-year to NT$9.22bn, with brokerage income up 39.7% and proprietary trading income up 48.0%.

Outlook and guidance

• Full-year wealth management income is expected to exceed annual guidance, achieving double-digit growth.

• Focus on expanding high-value and new businesses, optimizing asset structure, and enhancing profitability.

• Plans to deepen cross-selling synergies, grow digital income, and promote sustainable operations.

• SKL will continue to promote FX policies and high CSM products to control hedging cost and accumulate CSM.

• Targeting annual hedging cost below 150 bps for 2024.