E.SUN FHC held its investor conference today (6) to announce its unaudited 2017 earnings. Cumulative profit was NT$14.74 billion, another new record high performance for the 6th consecutive year; earnings per share (EPS) was NT$1.49, ROE was 10.51%, and ROA was 0.74%. President Joseph Huang reiterated that the keywords in E.SUN's strategy will be technology, cross-border, and three lines of defense. He also announced that the company had invited big data and AI expert Professor Sheng-Wei Chen to lead E.SUN in future technological advancements.
According to President Joseph Huang, Professor Sheng-Wei Chen, being Academia Sinica Research Fellow and CEO of Taiwan AI Academy, is one of leading experts on data science and artificial intelligence in Taiwan. Professor Chen possesses extensive knowledge of his field and a lot of experience in industry-academia collaboration. Professor Chen will be serving concurrently as CTO and leader of the tech consulting team. This is the first time a financial holding company in Taiwan names a CTO. It is hoped that with the CTO at the helm, banking and technology can be blended to inspire more applications and innovations and create new horizons in the banking sector of Taiwan.
E.SUN FHC's overall net profit in 2017 was NT$45.8 billion and 11.5% higher on a YOY basis. Net interest income and net service fee income also increased by 8.0 % and 1.4%. Net profit after tax rose by 12.2% to NT$14.74 billion. Regarding deposits, the total deposit balance grew by 9.9%, while the increase in foreign currency deposits was the highest in the country at 30.2%. It reflected the success of E.SUN's overseas operations in driving cross-border service and the demand for foreign currency. Regarding loans, the total loan balance grew by 8.2%, while SME loans and foreign currency loans showed double-digit growth. Loan growth was achieved while maintaining sound asset quality. The NPL ratio was 0.23% and still above the market average.
Regarding service fee income, E.SUN Bank ranked third among banks in total service fee income. The service fee income was less than satisfactory for the market as a whole in 2017. Nevertheless, E.SUN reported record high in credit card spending. In addition, E.SUN Wallet, having successfully broken into the four major convenience store chains, reported a 13.1% annual growth in net credit card service fee. E.SUN continued to surpass its peers in growth.
Meanwhile, President Joseph Huang announced E.SUN FHC's unaudited January 2018 earnings. Profit in January was NT$1.92 billion and 58.6% higher on a YOY basis. It was a record monthly high for E.SUN FHC and mainly attributed to continuing revenue and profit growth fueled by recovering momentum in wealth management service.
Going forward into a new year, President Joseph Huang says 2018 is going to be a year of mild growth as economic growth, driven by investment, manufacturing, and recovering trade, becomes more stable. The IMF sets its global GDP growth forecast at 3.9%. Export growth, supported by recovery in major economies, stay positive. There is also room for growth in investment and consumption in Taiwan.
For the "technology" strategy, E.SUN will continue to provide innovative products and services as well as a premium customer experience. For the "cross-border" strategy, E.SUN currently operates 25 offices in 9 countries and regions to create a complete cross-border banking platform in Asia. President Joseph Huang goes to say that many SMEs in Taiwan are strong players in their fields and some are surprisingly hidden champions in their lines of business. As a company is handed down from the first generation to the second generation, both the company and the second generation owner face challenges of running a business and passing on assets. E.SUN is the No. 1 choice of private sector bank for SMEs. The bank is experienced in providing assistance for businesses and family wealth management service. E.SUN offers a full range of advisory services to help Taiwanese SMEs continue to pass on their businesses and assets as well as the entrepreneurial spirit and the right values and achieves sustainability.
For the "three lines of defense" strategy, E.SUN believes compliance and anti-money laundering is the key to managing a successful financial institution. The Asia/Pacific Group on Money Laundering (APG) is coming to Taiwan to inspect the results of AML practices in the country. Therefore, E.SUN has built a sound AML system and implemented self-assessment as the first line of defense, compliance and risk management as the second line of defense, and internal audit as the third line of defense. In response to the risks arising from various technologies and the compliance requirements, E.SUN has created the Information Security Management Division and the Legal Division, headed respectively by Chief of Information Security and Chief Compliance Officer, this year. These two divisions devote themselves to improving corporate governance while maintaining the same level of convenience and security in financial services.
Talent is E.SUN's most important asset. President Joseph Huang has also announced that a project to recruit 40 management associates (MAs) and technology management associates (TMAs) is launched as of now to satisfy the demand of cross-border service growth overseas and the plan for FinTech applications. Applications are open until the end of March 2018. MAs and TMAs will have plenty of opportunities to apply their knowledge and skills and receive solid training. Many are placed in charge of important domestic or international banking or technology projects at E.SUN. MAs and TMAs embrace challenges and train to become excellent managers with a global perspective and vision. E.SUN also welcomes experts with certificates for digital banking, information technology, big data analytics, risk management, and AML. Plans have been made in 2018 to recruit 500 outstanding individuals who hope to make a career in the banking sector.
E.SUN has been reporting good business results for years in a row. The bank delivers an excellent performance in FinTech and in Asian operations. It also pays particular attention to corporate social responsibility. E.SUN has been included in the DJSI for four consecutive years and in the DJSI World twice. It also obtained the highest MSCI ESG Leaders Index rating of AA in the banking sector of Taiwan. For E.SUN, these honors come with great responsibility and keep the bank pushing itself to create more value for customers and the community as a whole.