Cathay Financial Holding Co President Lee Chang-ken said the company aims to build a comprehensive platform in China and Southeast Asia
By Kao Shih-ching / employee reporter
Cathay Financial Holding Co (國泰 金控) shareholders on Friday approved the company’s proposal to raise up to NT $ 50 billion (US $ 1.78 billion) in new capital to fund future M&A transactions .
The financial conglomerate plans to issue fewer than 1 billion new shares at a convenient time to raise funds, it said to shareholders at an annual general meeting in Taipei.
Cathay Financial aims to build a comprehensive financial platform in the Greater China and Southeast Asian markets, said President Lee Chang-ken (李長庚) at the meeting.
Photo courtesy Cathay Financial Holding Co
The company’s banking arm, Cathay United Bank (國泰 世華 銀行), has opened offices in nine countries in Southeast Asia, while its insurance subsidiaries have offices in Vietnam, Lee said.
“There’s still a lot of room for expansion,” he said.
Cathay Life Insurance Co (國泰 人壽) posted a loss of NT $ 8.8 billion last year on an investment in Indonesian PT Bank Mayapada Internasional Tbk, but Lee said this was “an isolated incident” and the company’s investments in Would not limit Southeast Asia.
However, the spread of COVID-19 infection has limited cross-border movement and slowed down company screening and due diligence of target companies, Lee said.
The pandemic has had different effects on different industries and countries, but has also revealed some favorable M&A opportunities for the company, he added.
Cathay United Bank has seen a decline in demand for credit and asset management due to COVID-19, but the impact of the pandemic on the Taiwanese economy is likely to decrease as vaccination rates rise and tighter antivirus measures are lifted, Lee said.
Cathay Life Insurance sales are expected to improve in the second half of the year as the government plans to lower a Level 3 COVID-19 alert to Level 2, which would allow the company’s sales agents to visit customers in person, added he added.
“With the COVID-19 pandemic predicted to become a seasonal disease like the flu, we expect the virus’ impact on the global economy to diminish,” Lee said.
Still, CTBC Financial Holding Co (中信 金控) chairman Yen Wen-long (顏文隆) told the company’s shareholders on Friday that the global economy is still facing challenges this year as the forecast for the development of the pandemic is likely high volatility in the financial markets will be difficult.
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