PCSC New Team Proposes 4 Major Directions, Risk Control as Top Priority

Taipei, July 7 (CNA) PCSC Financial Holding Co., Ltd. (PCSC) CEO Wu Ying stated today that the new team will strive towards four directions: strengthening the balanced development of subsidiary businesses, enhancing corporate governance, motivating employees to improve their professionalism and pursue the group's sustainable development. In an environment of volatile international geopolitical and economic situations, strengthening asset quality and strictly controlling market risks will be the top priority to ensure stable profits amidst a turbulent market.

PCSC held its second-quarter online investor conference this afternoon. This is the first time the new team has publicly explained the company's operational status since the board of directors was reconstituted at the end of May.

Wu Ying indicated that PCSC's profit performance has been outstanding, benefiting from active capital market trading and effective stock and bond operations. Core subsidiaries, the bill finance company and securities firm, continue to contribute to revenue. PCSC's self-assessed net profit after tax for June was NT$770 million, bringing the cumulative net profit after tax to NT$2.783 billion, a year-on-year increase of 323.61%, with earnings per share (EPS) of NT$0.77.

Wu Ying pointed out that all businesses achieved steady growth in the first half of the year. The proprietary trading and investment departments of each subsidiary fully seized market opportunities, achieving excellent results in investment income. Following the smooth reconstitution of the board of directors at the end of May, the new management team will strive towards four directions. First, strengthening the balanced and stable development of subsidiary businesses to create maximum shareholder value. Second, enhancing corporate governance standards, rigorously controlling risks, strengthening asset quality, and implementing internal controls.

Third, motivating employees to improve their professionalism and creating a happy workplace. Fourth, establishing a high-quality corporate image, pursuing the group's sustainable development, and cooperating with the board's policies to create better operating results for the company.

Wu Ying stated that in an environment of volatile international geopolitical and economic situations, the management team will prioritize strengthening asset quality and strictly controlling market risks. They will also flexibly adjust stock and domestic/foreign currency bond positions to optimize the investment portfolio structure, ensuring the group can achieve stable profits in a turbulent market. In addition to consolidating the core competitiveness of the bill finance and securities companies, they will leverage the group's strength to fully support and promote the development of its invested entity, Rakuten Bank, to create more diversified profits.

PCSC Securities' profit for the first six months of this year was NT$2.043 billion, a significant increase of NT$1.939 billion compared to the same period last year. Regarding external attention on whether the securities subsidiary has plans for capital increase, PCSC stated that the capital adequacy ratio is at a relatively tight level, which may affect business capacity. An evaluation of the securities firm's dividend policy will be conducted at the end of the year. Capital can be strengthened through retained earnings capitalization first, before assessing the necessity of a capital increase.

Regarding whether the securities subsidiary may become a wholly-owned subsidiary of the financial holding company in the medium to long term, a PCSC executive explained that the financial holding company currently holds a 61% stake in the securities subsidiary. Becoming a 100% subsidiary is indeed a direction that needs to be pursued in the long term. This can be achieved through methods such as share exchange or cash acquisition, but it depends on market conditions, the valuation level of the securities firm, and the willingness of other external shareholders of the securities firm. Currently, there are no related discussion proposals.

As for Rakuten Bank, in which PCSC has invested, as of the end of June, the number of accounts increased to 356,000, with deposit balances reaching NT$44.15 billion and loan balances reaching NT$30.312 billion.

PCSC pointed out that this year can be considered the first year for Rakuten Bank's corporate banking development. Rakuten Bank's corporate deposit balance reached NT$6.54 billion, and its corporate loan balance reached NT$6.92 billion. Relevant systems have also been established, aiming for higher stickiness with legal entity clients. The market demand for personal financial credit has been very strong this year, and the bank expects to gradually increase its interest margin. (Edited by Lin Shu-yuan) 1150707

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