| Prime News | | ![]() | ![]() | Cathay Becomes the First 'Model Life Insurance Firm'
Taipei, Oct. 9, 2007 (CENS)--Cathay Life Insurance, the leading Taiwanese life insurance firm, has become the island's first 'model life insurance company' meeting the eight conditions for the qualification, which will exempt it from need of approval by the regulator for launch of new insurance policies in the following one year, an unprecedented practice in the 40-year history of the domestic insurance market.
The privilege is expected to greatly enhancement management flexibility of Cathay Life Insurance, enabling it to grasp business opportunities timely, which will considerably facilitate its operation.
The "model life insurance company" system is part of the effort of the Insurance Bureau of the Financial Supervisory Commission (FSC) in simplifying the monitoring of domestic life insurance firms' operations, following up on the delegation of new-policy screening to insurance firms' own policy underwriters and actuaries, instead of officials and scholars in the past, before submitting the new policies for approval by the Insurance Bureau, a practice which was put into practice in September last year. The original screening system had been long criticized for its protracted process, often costing companies precious business opportunities.
Cathay Life Insurance has secured the qualification by managing to cut the policy complaint rate, its major deficiency in applying for the qualification previously. To secure the application, a life insurance firm has to be among tops in the industry in eight aspects, including capital adequacy ratio, credit rating, complaint rate, policy persistency rate, regulation compliance, and qualification of policy underwriters.
Cathay Life Insurance, though, will be revoked of the qualification in the following one year, should its capital adequacy rate drop below 250%, it be penalized for breach of regulations, or ratio of full-time policy underwriters drop under 75%.
The success of Cathay Life Insurance in winning the qualification is expected to inspire other domestic insurance firms to make a similar effort, as it will greatly enhance their corporate image, in addition to the convenience for their operation. Smaller life insurance firms, though, may have difficulty doing so, as they are outsourcing bulk of their policy underwriting to insurance brokers, with ratio of their in-house policy underwriters far below the required 75%.
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| | ![]() | | | Gov't Requested to Suspend Taiwan Financial Holding Project
Taipei, Oct. 9, 2007 (CENS)--The financial committee of the Legislative Yuan passed a resolution yesterday (Oct. 8) calling for suspension of the Taiwan Financial Holding Firm project, but the Executive Yuan (the Cabinet) reiterated its determination to see the birth of the new company on January 1, 2008, as scheduled.
The resolution was pushed through by opposition legislators, contending that incorporation of the Export-Import Bank of ROC into the projected financial holding firm, along with Bank of Taiwan and Land Bank of Taiwan, will lead to cession of its function supporting domestic exporters, especially small and medium ones. The elimination of the bank, added opposition legislators, also violates the "Statute for the Export-Import Bank of ROC," which is still valid.
In addition, the financial holding firm project fails to address interests of employees properly, and group contracts for the new company have yet to be settled, noted opposition legislators.
Su Ler-ming, director general of the National Treasury Agency, the Ministry of Finance, though, noted that while the MOF respects the resolution of the financial committee and will continue communicating with its member legislators, the schedule for the formation of Taiwan Financial Holding Co. will remain unchanged. Hsieh Chi-wei, director general of the Government Information Office and spokesman of the Executive Yuan, also reiterated the executive branch's determination to see the birth of the new company on January 1 next year, saying that the resolution of the Legislative Yuan's financial committee has no legal binding power.
The MOF explains that the Export-Import Bank will still exist as a subsidiary of the Taiwan Financial Holding initially, before converting into a subsidiary insurance firm later on, conforming to legal requirements fully throughout the process.
In addition, Bank of Taiwan will take over export-import financing business and even expand the business scale, according to Hsieh Chi-wei.
Moreover, Hsieh noted that the labor union of the Bank of Taiwan has ratified the group contract, which will be signed by the management and the labor following approval by the bank's board of directors, and the labor unions of the Export-Import Bank and Land Bank of Taiwan are also drafting similar contracts.
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| | ![]() | | | Shipments of LED Backlight Panels on the Rise
Taipei, Oct. 9, 2007 (CENS)--Following the announcement of Samsung Electronics Corp. to increasingly adopt LED (light emitting diode) backlight panels on its 12.1-, 13.1-, 14.1- and 15.4-inch notebook personal computers, such panel manufacturers as south Korea's LPL (LG Philips LCD), Taiwan-based AU Optronics Corp. and Chi Mei Optoelectronics Corp. will see sharply rising shipments of LED backlight panels in 2008.
Although the price difference between LED backlight and CCFL panels reaches as high as US$30 up to US$50 each, Samsung has recently announced that it would largely adopt the LED backlight panel for the reason of environmental protection.
Samsung vice president Sang-soo Kim said high price is still the major weakness for the promotion of the LCD backlight panels. He stressed his company would adopt the LED backlight panels on half its NBs to be introduced in 2008.
South Korea's LPL has already adopted LED backlight panels on its 15.4-inch NBs and is planning to extend the application of the LED backlight panels to the production of 13.3-inch panels.
Taiwan's Chi Mei Optoelectronics and AU Optronics said they would cooperate with large-sized manufacturers of personal computers to develop LED backlight NBs of various sizes.
According to a survey conducted by the market analyst—DisplaySearch, the ratio of NBs adopting LED backlight panels will increase to 45% in 2010 from present 20%. The market researcher also predicted the market scale for the LED backlight panels will grow seven times to reach US$950 million in 2010 from this year's US$130 million.
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| | ![]() | | | Taichung Commercial Bank Outlook Revised to Positive From Stable
Taipei, Oct. 9, 2007 (CENS)--Taiwan Ratings Corp. (TRC) recently raised its outlook on Taichung Commercial Bank to positive from stable. At the same time, the "twBBB" long-term counterparty credit and "twA-3" short-term ratings were affirmed.
The outlook revision reflects the likelihood that Taichung Commercial Bank will enhance its core earning capability supported by its ongoing loan mix adjustment with relatively stable net interest margin, and increasing fee income contribution from wealth management activities.
The ratings continue to reflect the bank's good regional presence, diverse deposit profile, and adequate asset quality and capitalization. These strengths are partly offset by the bank's small operating scale and mediocre, but improving profitability.
The TRC said Taichung Commercial Bank has a good presence in central Taiwan, which helps the bank to control its asset quality by local familiarity and enjoy the lower funding costs from the diversified deposits of regional retail clients. Recognizing its geographical concentration, the bank is likely to gradually expand its business beyond central Taiwan, which accounted for 83.6% of its total loan extension at the end of June 2007.
Taichung Commercial Bank's earnings profile is mediocre mainly due to its small operating scale and relatively standard product lines, but this is likely to improve. The bank has maintained a somewhat stable net interest margin, underpinned by its lower funding costs as a result of higher than average demand deposit (44% of total deposits at the end of June 2007). Taichung Commercial Bank has also gradually raised its fee income contribution, which increased to 12% in the first half of 2007 from 6.6% in 2006. Without the need for the bank's substantial credit provision requirement this year, its annualized return on average assets also achieved 0.6% in the first half of 2007, higher than the industry average of about 0.2% during the same period and an improvement on the bank's 2002-2006 average of negative 0.7%.
TRC noted Taichung Commercial Bank's asset quality and capitalization are adequate. The bank's ratio of impaired assets was 2.1% at the end of June 2007, down from 3.3% at the end of 2005, and its reserve coverage ratio was a satisfactory 51% at the same time. In addition, the bank has improved its quality oversight on newly extended loans. Following the bank's new capital injection of NT$5 billion (US$153.84 million at US$1:NT$32.5) in the first quarter of 2007, its ratio of adjusted equity to assts (adjusted from unamortized losses from the sale of nonperforming assets, and the expectation of 50% credit losses on impaired assets) was a comfortable 5.9% at the end of June 2007, up from 2.9% at the end of 2006.
The positive outlook reflects TRC's expectation that Taichung Commercial Bank is likely to improve its core earning capability, supported by its stronger risk controls, moderate business growth strategy, and increasing fee income contribution.
The bank's asset quality and capitalization are likely to remain at the current level over the medium term. The ratings may be raised if the bank can further improve its earnings profile. On the other hand, if the bank's profitability deteriorates due to aggressive growth, weakened asset quality with higher credit costs, or higher risk appetite in investments, the outlook could be revised to stable.
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| | ![]() | | | Mainland Chinese Officials Cancel Participation in Cross-Strait IP Forum
Taipei, Oct. 9, 2007 (CENS)--Officials of mainland Chinese intellectual property (IP)office recently faxed to their Taiwanese counterparts their decision to cancel their scheduled participation in an upcoming cross-strait IP forum, triggering speculations that Taiwan's UN-entry bid is to blame for the cancellation.
According to forum organizer, Chinese National Federation of Industries (CNFI), the mainland office recently notified it in a fax that "as a result of unclear situation we delay visiting Taiwan". CNFI is consigned by the Intelligent Property Bureau of the Ministry of Economic Affairs to organize the forum.
CNFI officials pointed out that the mainland office did not tell what the "unclear situation" refers to and how long the visit will be postponed.
The mainland IP office originally planned to send around 10 officials to take part in the forum, which scheduled for mid-October. China's Vice Premier Wu Yi leads the IP office in person.
CNFI officials speculated the cancellation must have something to do with Taiwan's aggressive UN-entry bid. They noted that it is China's first official move to dampen official exchanges between Taiwan and the mainland since Chinese President Hu Jintao bitterly lashed out Taiwan's UN-entry referendum early last month.
The ruling Democratic Progressive Party (DPP) intends to hold the referendum in conjunction with presidential election in March next year, a move considered as the party's plot to win the election by stirring up islandwide populism against the mainland.
CNFI officials pointed out that the cancellation chocked the opportunity for the meeting between highest-ever ranking officials of IP administration across the Taiwan Strait. China's IP officials were arranged to visit Taiwan's IP bureau during their stay here.
The forum originated from a conclusion reached in May early last year in Beijing between the mainland's IP regulator and Taiwan's IP delegates led by IP bureau's director general, L.S. Tsai.
Upon learning the mainland's decision, Tsai said he felt disappointed. He noted that the two sides of the Taiwan Strait should maintain interchange channels for IP issues along with trade interdependence of the two sides increasing. Tsai is due to retire in December this year. He has hoped to achieve major breakthroughs in IP talks with his mainland counterparts before retirement.
Taiwanese political observers pointed out that many routine exchanges between the two sides have been suspended since Taiwan began pushing its UN bid. Ranking officials of the Cabinet-level Mainland Affairs Council (MAC) said Taiwan has felt pressure from the mainland after beginning pushing UN-accession attempt.
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| | ![]() | | | Taiwan t Inks Cooperation Pacts With World's Top 5 Telecom Gear Suppliers
Taipei, Oct. 9, 2007 (CENS)--Economics Minister Steve Chen will sign cooperation agreements soon with Sprint Nextel, Nokia-Siemens, Alcatel-Lucent, Motorola and Starent to secure their pledges to place WiMAX contracts and license WiMAX technology to Taiwanese equipment suppliers.
Officials with the Ministry of Economic Affairs (MOEA) said the ministry plans to develop Taiwan into the world's most important shopping center for WiMAX equipment through directing the top five telecom-gear suppliers' technologies and orders to the island.
According to the ministry, the five suppliers have pledged to license technologies for making WiMAX base stations, consumer premise equipment (CPE), and point-to-point networks and help Taiwanese contract manufacturers vie for orders from telecom-equipment players.
The five suppliers also agree to procure equipment in Taiwan and work with Taiwanese equipment suppliers to tap global market, according to MOEA officials.
They described the agreements are a major step to elevate Taiwanese telecommunications-equipment suppliers to global stage.
MOEA officials said Alcatel-Lucent even promised to open a WiMAX research and development center in Taiwan and make Taiwan a pivot for its deployment in global WiMAX market.
Industry watchers pointed out that Taiwanese telecommunications-equipment suppliers would likely begin landing considerable orders from international players at the end of this year under the assistances of the ministry and the top five suppliers.
Although the MOEA did not disclose the number of equipment the five suppliers promise to buy from Taiwanese contract suppliers, they said the island's shipment of WiMAX equipment for end users would surge to over NT$5 billion (US$151 million at US$!:NT$33) by the end of this year and to NT$18.1 billion (US$548 million) next year from last year's NT$1.4 billion (US$42 million). Shipments of base stations would likely increase to NT$1.4 billion (US$42 million) next year and NT$2.9 billion (US$87 million) in 2009.
According to Taiwanese insiders of telecommunications-equipment line, Sprint Nextel has placed orders with ZyXEL Communications Corp. for WiMAX end-user equipment and gave its word that it will increase orders to the Taiwanese supplier. Nokia-Siemens, Alcatel-Lucent and Motorola, they added, had pledged to contract Taiwanese suppliers to make microwave equipment for them.
The MOEA pointed out that the most likely Taiwanese equipment suppliers to win international players' orders for WiMAX base stations are Tecom Co. Ltd., ZyXEL and GemTek Technology Co., Ltd. International players' orders for CPE are likely go to Accton Technology Corp., D-Link Corp., and Delta Electronics Inc. in addition to ZyXEL and GemTek.
The ministry pointed out that Chen will ink the agreements with Marko Tiesmaki, head of business development, broadband wireless access, Nokia Siemens Networks; Patrick Plas, chief operating officer of Alcatel Lucent's GSM/WiMAX business; R.B. Hsieh, Motorola Taiwan's president; and Ashraf Dahod, Starent Networks' CEO.
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| | ![]() | | | MOEA, MOF Reach Consensus on Biopharmaceutical Firm R&D Tax-deduction Bill
Taipei, Oct. 9, 2007 (CENS)--Both the Ministry of Economic Affairs (MOEA) and Ministry of Finance (MOF) recently agreed to provide up to 35% tax offset to biopharmaceutical developers so as to encourage new-drug development in Taiwan.
According to MOEA's bill for biopharmaceutical company R&D, professional-development and tax-deduction measures, biopharmaceutical firms (limited to new-drug developers) with R&D and professional-development expenses exceeding 5% of its annual revenue are eligible for up to 35% company tax offset (with the expenses), while institutional shareholders holding stakes in over three biopharmaceutical developers can also enjoy a 20% tax deduction.
MOEA said that it has reached consensus with MOF over the new biopharmaceutical-industry incentive bill.
MOF said that the high tax offset rate provided is to encourage investments in local biopharmaceutical companies, which often pour enormous amounts of money in R&D but have to cope with waiting long periods before seeing returns.
According to the bill, biopharmaceutical companies involved in new-drug and highly risky medical device R&D and talent-cultivation can use up to 35% of its total R&D and talent-cultivation expanse to offset the due annual income tax amount.
MOEA said that the new tax-deduction means would be retroactive to July 6 this year and would be effective until December 31, 2009.
The method is only applicable with companies' R&D and professional-development expenses in Taiwan, and the "biopharmaceutical companies" are restricted to ones conducting new-drug development; new-drug clinical tests/field tests with permissions from local and foreign related authorities; or companies with permission to commercialize or manufacture new drugs. In addition, governmental subsidization to a biopharmaceutical company's R&D and professional-development is excluded from the application (as the amount is not part of corporate capital).
Companies that already enjoy tax-deduction programs are not eligible for other tax-reduction incentives provided by the government.
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| | ![]() | | | Hotai Predicts Overall Domestic New-car Sales to Hit 360,000 in 2008
Taipei, Oct. 9, 2007 (CENS)--Domestic new-car sales are expected to rebound to about 360,000 units next year, and enjoy a more favorable business climate as early as in 2009, according to Daniel Chang, president of Hotai Motor Co. Ltd.
Hotai has been the No. 1 auto dealer in Taiwan for several years. The company sells both locally made and imported Toyota and Lexus car models.
According to Chang, the domestic automobile market is expected to gradually recover from a trough in 2006 (down over 30% from previous year) and this year (continuing the down-turning trend) after the presidential election early next year.
The president explained that the weak consumer confidence plus the highflying fuel prices have not only affected domestic new-car sales but also decreased the vehicle maintenance frequency due to lesser driving. Toyota car drivers in Taiwan, for example, he said, drove an average of 8,000 to 10,000 kilometers per year before, but the average mileage has shortened to 6,000 to 8,000 kilometers now, leading to less frequent tune-ups.
Chang added that Toyota's Japanese headquarter has sent a group of experts to jointly conduct local market survey with Hotai and made a forecast for the 2007 overall new-car sales in Taiwan (360,000 units) according to local economic indicators and face-to-face interview result findings.
Another affecting factor to next year's domestic new-car sales is the new fourth-stage emission standard effective on the first day of 2008, which is expected to ramp up automaker's cost in meeting the stricter emission regulations.
China Motor Corp., local producer of Mitsubishi car models, said that it would hike the prices of commercial vehicle models by at least NT$20,000 (US$606 at US$1: NT$33) each. In conjunction with the sharp appreciation of euro, almost all local agents of imported cars, including that of Mercedes-Benz, BMW, Audi, etc., plan to hike 2008 prices.
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| | ![]() | | | Taiwan Sees Cold Capital Market in First 9 Months
Taipei, Oct. 9, 2007 (CENS)--Taiwan saw a cold capital market in the first nine months of this year due mainly to weak underwriting of stock, bonds, and syndicated loans despite a lukewarm overseas fund-raising market.
During the period, the funds raised from initial public offering (IPO) market was only one fourth of the corresponding figure of last year, those from floating bonds tumbled by 42.6% and those from syndicated loan market shrank by 15.7%, according to the statistics compiled by Bloomberg, a world's leading financial information provider.
The statistics showed that Taiwan registered 22 IPOs in the first nine months, which raised funds totaling NT$11.761 billion (US$356.39 million at US$1 = NT$33), a sharp fall of 74.3% from last year's corresponding NT$45.774 billion (US$1.39 billion).
In the same period, the issue of financial and corporate bonds reached NT$107.18 billion (US$3.25 billion), down by over 40% from last year's corresponding NT$188.61 billion (US$5.72 billion). Of which, the issue of corporate bonds declined by two third while that of financial bonds increased by 16.25% or NT$9.01 billion (US$273.03 million).
The overseas exchangeable corporate bonds (ECBs) and depository receipts (DRs) floated by Taiwan businesses rose by about 10% in terms of value in the first nine months, due mainly to the massive selling of stock in Taiwan Semiconductor Manufacturing Co. by its large shareholder—Philips through issuing American depository receipts (ADRs). As a result, JPMorgan Chase and Goldman Sachs, the leading underwriters of the said case, are very likely to take the top two positions in Taiwan's overseas fund raising market this year.
In contrast to the chilly fund-raising market, Taiwan's merger market was quite hot. From January to September, the island saw merger value amount to a total of US$15.7 billion for a sharp annual rise of US$2.625 billion. Among the mergers, Taiwan Mobile Corp.'s buyout of Taiwan Fixed Network Co. was the largest with a value of US$1.933 billion.
During the period, other large-sized acquisition cases included the purchase of stake in Fu Sheng Industrial Co. by Oaktree Capital Management with a value of US$855 million and the acquisition of a stake in Gateway by Acer Inc. valued at US$755 million. Fu Sheng is Taiwan's leading golf equipment maker and Oaktree a U.S.-based private equity fund company. Acer is Taiwan's computer giant and Gateway a U.S. brand personal computer manufacturer.
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| | ![]() | | | Taiwan's Domestic Banks Bleed Some NT$30 B. in August
Taipei, Oct. 9, 2007 (CENS)--Taiwan's domestic banks together generated pretax profits of NT$18.54 billion (US$561.82 million at US$1 = NT$33) in the first eight months of this year, a whopping fall of NT$29.1 billion (US$881.82 million) from NT$47.6 billion (US$1.44 billion) posted a month earlier, according to statistics released by the Cabinet-level Financial Supervisory Commission (FSC).
Among the more than 40 domestic banks, 14 showed red ink during the period, including EnTie Commercial Bank, Jih Sun International Bank, Ta Chong Bank, Cosmos Bank, Fuhwa Commercial Bank, Far Eastern International Bank, Bowa Bank, The Chinese Bank, Union Bank of Taiwan, Standard Chartered Bank (Taiwan) Ltd. (formerly Hsinchu International Bank), ChinFon Commercial Bank, Enterprise Bank of Hualien (EBH), Taitung Business Bank, and Bank of Overseas Chinese. Of which, Bowa, ChinFon, The Chinese Bank, Taitung Business and EBH have either been taken over or on the watch list.
Insiders attributed the obvious shrinkage of profits earned by domestic banks in August to their active write-offs in non-performing loans caused by twin-card loan defaults.
Last year, domestic banks recorded a loss of NT$7.4 billion (US$224.24 million), and this year the situation seemed to improve with pretax profits of NT$47.6 billion (US$1.44 billion) raked in the first seven months. However, in August alone, the banks together witnessed a loss of near NT$30 billion (US$909.09 million), which helped cut profits down to NT$18.5 billion (US$561.82 million) at the end of the month as a result.
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| | ![]() | | | Qisda to Deliver Smartphones to British Telecom in Oct.
Taipei, Oct. 9, 2007 (CENS)--After terminating its investment in BenQ-Siemens, Qisda Corporation, a handset maker spun off from Taiwan's BenQ Corporation, is scheduled to start delivering its first batch of smartphones E72 series, compatible with unlicensed mobile access (UMA) technology, to British Telecom sometime this month, according to company sources.
E72 smartphone is the world's first UMA-based model developed with Microsoft's platforms. In the past, Nokia, Motorola and Samsung promoted several UMA phones, which were generally focused on audio and video functions. But telecom service carriers prefer to apply UMA technology widely onto digital services, such as Internet radio, live communications, e-mail service and Internet browse.
In fact, there are also quite a few suppliers in Taiwan attempting to venture into development of UMA technology, but with only Qisda and Chi Mei Communication System Inc. successfully completing the development. Chi Mei Communication has started production of HP's iPAQ 510 smartphone with UMA technology, and has been patronized by telecom service companies.
At the moment, ASUSTeK Computer Inc., E-Ten Information Systems Co., Giga-byte Communications Inc., High Tech Computer Corporation (HTC) and Wistron Corp. are concerned about development of UMA technology, which can now be used in 2-generation communication only. Accordingly, HTC still shows little interest in investing in the development of UMA technology.
BenQ Corp. is Qisda's first client in Asia for its E72 series smartphones, which will be launched in mid-October under the brand of "BenQ." However, as Taiwan's telecom service companies have yet to launch UMA-based services, the smartphones sold under BenQ won't adopt UMA technology. Meanwhile, Qisda has not only received orders from British Telecom, but is also approaching many potential clients now.
ABI Research, a market survey institute, noted that UMA technology, which is able to incorporate fixed mobile convergence (FMC) technology, has been widely applied onto mobile phones, despite emergence of a competing volumetric capillary cytometry (VCC) technology. ABI Research projected the number of users for UMA-based service to reach 65 million by 2012.
Besides, ABI Research indicated that British Telecom, which has had more than 40,000 registered users for UMA-based service, has also launched the service for commercial use in eight European countries, hoping to attract more users. In the mean time, France Telecom has promoted a similar service of Unique and sold over 250,000 units of UMA smartphones.
Coincidentally, U.S.'s T-Mobile has officially launched its UMA-based service since June and North Europe's Telia Sonera has applied that commercially, while other telecom service companies, including Telecom Italia, Korea's KTF, Ireland's Eircom and Philippine's Smart, have also moved to offer such a service. Some projected that with telecom service carriers actively promoting UMA-based service, business opportunities in the global market for FMC technology will be worth US$46.3 billion in 2010.
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| | ![]() | | | HTC Scored Whopping EPS of NT$33 for First 3 Quarters
Taipei, Oct. 9, 2007 (CENS)--The Taiwan-based High Tech Computer Corp. (HTC), one of the world's leading suppliers of handsets, posted record monthly sales revenue of NT$10.551 billion in September, the highest-ever quarterly pretax earnings of NT$8.026 billion for the third quarter of this year, and whopping net earnings of NT$33 per share for the first three quarters of the year, according to company sources.
HTC recently launched its HTC Touch handsets in the U.K. and Germany, and is bidding for orders from AT&T for new mobile phones. HTC's handsets are the most competitive in terms of price among three bidders for AT&T's orders.
HTC posted an annual revenue growth of 18.73% in September and aggregate revenue of NT$79.57 billion for the past three quarters of this year, increasing by 4.2% from a year earlier.
The company noted that its sales revenue for the third quarter was NT$29.108 billion, up 10.44% from a year earlier and slightly higher than its original projection of 10%, with pretax earnings of NT$8.026 billion and net earnings of NT$7.384 billion for the quarter. Based on its existing capitalization, the company has scored net earnings of NT$33 per share, including NT$12.88 in the third quarter alone.
Also thanks to its HTC Kaiser and Nike series handsets for sales in the fourth quarter of this year, HTC has successfully landed orders from large-sized telecom service carriers in North America, Asia and Europe, including AT&T, NTT DoCoMo, Orange, O2, T-Mobile and Vodafone. Merrill Lynch projected HTC's sales for the fourth quarter to grow by 20% from the third quarter, and to keep growing next year.
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| | ![]() | | | Mobile TV Service Sector Clicks on New Channel of Opportunity
There will be at least 20 makers of mobile phones, chipsets, portable media players and set-top boxes who are set to venture into the market for mobile TV services next year, Dibcom forecasted.
Dibcom is the world's biggest supplier designing chipsets for mobile devices, which generated about 20 million euros last year, or NT$900 million, with Motorola, Samsung, LG, SAGEM, and Taiwan's High Tech Computer Corp. on its client list. Company sources said that Dibcom sent its chief executive officer (CEO) to Taiwan to promote mobile TVs in mid-September.
Motorola, Nokia and Taiwan's Gigabyte Technology Co., Ltd. have already worked with Taiwan's Public Television Service (PTS) to promote mobile TV services. Meanwhile, BenQ Corporation has launched its BenQ-Siemens P51 PDA phone to test the market for mobile TVs and is scheduled to unveil another new model compatible with mobile TV services in the first half of next year, while Nokia is competing with models 7710 and N92, and Gigabyte with T600.
Statistics say that the number of mobile TV service users amount to only 30 million worldwide at the moment; however, such number is expected to sharply grow to 500 million persons by 2010, with such a substantial increase in users to generate enormous business potential for makers of mobile phones.
Aside from mobile phone makers, suppliers designing integrated circuits (IC) and chipsets already see windows of opportunity opening, with Taiwan's MediaTek Inc. and other large international suppliers in the sector moving to venture into the market.
Furthermore, Qualcomm, the world's leading supplier with the Mediaflow technology for mobile TV services, is reportedly to launch a multi-functional chipset compatible with digital video broadcasting-handheld (DVB-H) standards, aiming to expand market shares to keep its lead in the field.
PTS Eager to Certify as Mobile TV Operator
In addition, PTS is aggressively trying to be certified as an operator of mobile TV services, as well as considering to set up a new company to specialize in offering such services, according to Yuan-hui Hu, CEO of PTS,
Furthermore, eying the added-value generated by offering mobile TV services, quite a few telecom service providers in Taiwan, including Chunghwa Telecom Co., Ltd., Taiwan Mobile Co., Ltd. and Far EasTone Telecommunications Co., Ltd., also are eager to work with PTS, despite such services having been delivered on a trial basis. Thus, PTS might propose to these interested partners to invest in new affiliates to exploit the potentially huge business opportunities.
Hu said that it would be better for TV stations and telecom service providers to team up to vie to be certified as mobile TV service operators, because the former already have broadcasting infrastructure and the latter base stations all around the island, with the two sides to profit immediately from the existing, sound facilities once they become partners.
Furthermore, telecom service providers are very likely to strike gold with such popular digital broadcasting application as mobile TV services. In fact, the development and popularity of the existing 3G mobile communication services are still limited by bandwidth; however, mobile TV signals can be transmitted through one-way broadcasting network and returned through 3G communication or wireless fidelity (Wi-Fi) network for better interaction. Therefore, mobile TV services are expected to open another window of opportunity for telecom service carriers.
Hu indicated that an initial test of mobile TV services with the DVB-H standard has been completed, and a further test will soon begin, which will be focused on transmission quality and programming, as well as user response. All the test results will help PTS to hammer out the guidelines for offering commercialized services.
For now, PTS's partners for the next test include Chunghwa Telecom, Far EasTone, Taiwan Mobile, Motorola, BenQ and CyberLink Corp. (SC, September 2007)
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| | ![]() | | | Leading Taiwanese Banks Tapping Wealth Management Market in Hong Kong
Not only aggressively developing wealth-management businesses at home, Taiwan's three leading domestic commercial banks—First Commercial Bank, Hua Nan Commercial Bank and Chang Hwa Commercial Bank—have recently been working feverishly to expand such operations overseas, particularly in Hong Kong.
Hong Kong is very attractive to Taiwan's financial institutions to set up footholds because it is a major financial center for Taiwanese-invested enterprises in China, as well as being a long-standing capital in Asia's financial market.
Due to political reasons, Taiwan's domestic financial institutions are banned from setting up operations in China, with Hong Kong becoming the most favorite place by default to establish overseas operations to serve Taiwanese businesses in China.
In addition to businesspeople, more and more rich Taiwanese on both sides of the Taiwan Strait prefer to park their assets in financial institutions in Hong Kong. Seeing such a trend, Taiwanese financial institutions have been prompted to add wealth management consulting to the list of financial services offered by their branches there.
First Commercial started up a wealth management department in its Hong Kong branch February this year, with only six Taiwanese banks in Hong Kong offering such services before then. In September this year, Hua Nan, having operated in Hong Kong for 14 years, joined the segment by selling funds.
Yu-feng Hsu, manager at Hua Nan's wealth management department, discloses that its H.K. branch now has 15,000 clients, all of whom would be potential clients for its wealth management business. Hsu says that initially the bank targets to sell US$2-3 million of funds in H.K. monthly, which is estimated to generate a monthly service fee of NT$1 million (US$30,303 at US$1 = NT$33).
The bank predicts that its wealth management operation in Hong Kong may break even within half a year and start to turn profits thereafter. It foresees an annual growth of 30% in service charges generated by the wealth management business there in the future.
Hua Nan will market funds for several renowned fund operators, including Allianz Global Investors, a financial affiliate of German-based Allianz Group; Barings, a U.K.-based asset management firm; Deutsche Asset Management; First State Investment of the Australia-based Colonial First State Asset Management; Invesco Taiwan, formerly Grand Pacific Securities Investment Trust Co., and J.P. Morgan Asset Management.
Hua Nan will also focus on several hot funds available in Greater China, as well as being ambitious to tap the wealth management market in Singapore.
Since its entry into the H.K. wealth management market February this year, First Commercial has seen smooth sailing, having broken even only five months later in its wealth management division by July. The bank employs six financial professionals in its wealth management team in Hong Kong to serve nearly 500 clients. And the bank plans to expand the operations in Hong Kong to meet the growing market.
Apart from Hua Nan and First Commercial, other Taiwanese banks who had joined the H.K. wealth management market earlier include Chinatrust Commercial Bank, Taishin International Bank, Taipei Fubon Commercial Bank, Bank Sinopac, Mega International Commercial Bank, and Cathay United Bank.
Chang Hwa Bank is also planning to follow suit, with its senior managers currently in H.K. to set up a wealth management division that is believed to come online by the end of this year. The bank will reportedly vertically integrate its wealth management operations in Taiwan and H.K. soon, as well as building a global platform for the operation. (JL, September 2007)
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