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First Financial Holding Co. Ltd. Interim / Quarterly Report 2017

Aug 31, 2017

52222_rns_2017-08-31_74613f73-ed54-4719-bbd5-aa324e3c144a.pdf

Interim / Quarterly Report

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First Financial Holding 1H 2017 Earnings Result

Aug. 31, 2017

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Disclaimer

This presentation is provided by First Financial Holding Co., Ltd. (“FFHC”). The information contained within is not reviewed or reviewed by any accountant or any independent third party. Users should read this material in conjunction with all other public financial and operational information filed to the competent authorities by FFHC. While we endeavor to provide accurate, complete and consistent information herein, FFHC makes no guarantee or warranties as to the accuracy or correctness of all the material contained. After this presentation is released to the public, we undertake no obligation to update any relevant data to reflect any change hereafter.

Users should also notice that this presentation may contain forward-looking statements. Statements that are not historical facts, including statements relating to the implementation of strategic initiatives, future business development and economic performance are forward-looking statements. By their nature, forward-looking statements involve uncertainties, risks, assumptions and other factors that could cause actual developments and results to differ materially from our statement in this presentation. These factors include, but not limited to, regulatory developments, competitive conditions, technological developments, general economic conditions and management changes.

The information, statements or opinions in this presentation do not constitute a public offer under any applicable legislation or an offer to sell or solicitation of an offer to buy any securities or financial instruments or any advice or recommendation respect to such securities or other financial instruments. First Group and all its affiliates representatives, no matter for their negligence or any other reasons, should not be liable for any loss or damages arising from the use of or interpretation by others of information contained within this presentation or any matter related to this document.

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Contents

  • At a Glance

  • Financial Highlight

  • Operating Results

  • Appendix

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At a Glance

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  • 1H17 subsidiaries’ earnings in line with target.

1H17 Bank’s profit grew by +4.1% (YoY) while other subsidiaries maintained growing momentum, group posted +9.9% (YoY) bottom line result in 1H17.

Loan demand driven by export while rate trough has been past. Export improved loan demand in 1H17 and both F/X/ & NTD cycle returns to upside trend, FB’s 1H17 loan growth +3.9%(YoY) ； NII grew by +3.7% (YoY).

  • Fee income resumed momentum since 2Q17 with narrowed gap. Despite 1H17 Fee income still fell by 9.9% (YoY), comparing with prior quarter -17.9% drop, 2Q17 fee revenues rebounded and started to catch up with the full-year target.

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1H 2017 Financial Highlight

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1H 2017 Key Figures

Key Figures ( in NT$ dollar, NT$ mn, mn shares or %)
Consolidated Net Income1
Comprehensive Income
Total Assets
EPS
Book per share
Capital Stock
ROAE
3
ROAA
3
Group CAR4
Double Leverage5
1H17
9,6081
9,134
2,556,132
0.79
15.58
122,164
10.14%
0.76%
115.67%
107.55%
YoY %
9.9%
1.5%
2.7%
9.7%
-3.9%
2.0%
8.3%
8.6%
-12.3%
1.1%
1H16
8,7461
8,999
2,488,308
0.72
16.21
119,769
9.36%
0.70%
131.84%
106.42%
1H17 Net Income Breakdown1( in NT$ mn) Key Figures ( in NT$ dollar, NT$ mn, mn shares or %)
Consolidated Net Income1
Comprehensive Income
Total Assets
EPS
Book per share
Capital Stock
ROAE
3
ROAA
3
Group CAR4
Double Leverage5
1H17
9,6081
9,134
2,556,132
0.79
15.58
122,164
10.14%
0.76%
115.67%
107.55%
YoY %
9.9%
1.5%
2.7%
9.7%
-3.9%
2.0%
8.3%
8.6%
-12.3%
1.1%
1H16
8,7461
8,999
2,488,308
0.72
16.21
119,769
9.36%
0.70%
131.84%
106.42%
Banking
NT$9,442; 98.3%
Securities
NT$124; 1.3%
Investment Trust
NT$28; 0.3%
Others
NT$72; 0.7%
Insurance
NT$(58); -0.6%

  1. Based on the classification of specific company’s business units, financial information by business segments should be listed individually.

  2. Comprehensive Income Statement is required by IFRS.

  3. Annualized figures. . 4. Updated semi-annually.

  4. Double Leverage = Equity Investment / Shareholder Equity

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Net Income & Comprehensive Income

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1H17 Consolidated Net Income & Comprehensive Income (in NT$ mn)
Credit (545)
Insurance (1,961)
24,506 (2,506)
(10,723)
↑ 9.9% ↑ 1.5%
(1,669)
9,608 9,134
(474)
Net Revenue Provision Operating Income Tax Net Income Other Items Comprehensive
Expense Income
1H16 Consolidated Net Income & Comprehensive Income (in NT$ mn)
Credit (921)
Insurance (146)
(1,067)
22,100 (10,707)
(1,580)
8,746 8,999
253
Net Revenue Provision Operating Income Tax Net Income Other Items Comprehensive
Expense Income
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Net Income Breakdown by Subsidiaries*

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1H17 FFHC Net Income Breakdown (in NT$ mn) ↑ 9.9%
↑ 4.1% 9,608
9,442
FFHC (30)
Aviva (28)
124 28
(58)
First Bank First Securities FSITC First-Aviva FFHC
1H16 FFHC Net Income Breakdown (in NT$ mn)
9,072 8,746
FFHC (30)
Aviva (29)
(135) 31 (59)
First Bank First Securities FSITC First-Aviva FFHC
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  • Major 4 subsidiaries were listed.

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1H 2017 Operating Results

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FFHC & First Bank Profitability -After Tax

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FFHC Net Income & ROAE (in NT$ mn & %)
Cumulative Net Income Annualized ROAE
10.14%
9.45% 9.32% 9.28% 9.36% 9.47% 9.10% 8.92%
17,284
15,962
13,407
12,018
8,746 9,608
4,406 4,309
9M 15 2015 3M 16 6M 16 9M 16 2016 3M 17 6M 17
First Bank Net Income & ROAE (in NT$ mn & %)
Cumulative Net Income Annualized ROAE
9.60% 9.56% 10.36% 9.86% 9.83% 9.46% 9.00% 10.00%
17,699
16,100
13,685
12,013
9,072 9,442
4,808 4,320
9M 15 2015 3M 16 6M 16 9M 16 2016 3M 17 6M 17
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1.Minority interests included

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FB 1H17 Pre-tax Profit

20,887
20,776
1H16
1H17
1H16 1H17
1H161H17
1H161H17
1H161H17
1H161H17
Cumulative Net Revenue
1H17 Cumulative Net Revenue(in NT$ mn or %)
% of FB Net Revenue(in %)
↓32.8%
z
Item
1H16
1H17
Change
NII
66.4%
68.5%
+2.1%
Net Fee
18.3%
16.4%
-1.9%
Gain on ST Invest.
-0.2%
0.5%
+0.7%
Gain on LT invest.
2.0%
0.7%
-1.3%
Gain on fin. Products
10.7%
12.7%
+2.0%
Others
2.8%
1.2%
-1.6%
Total Revenue
100.0%
100.0%
Provision Expense (net)
-4.2%
-2.5%
-1.7%
Operating Expense
-45.0%
-44.7%
-0.3%
Income Before Tax
50.8%
52.8%
+2.0%
Net Interest Income
13,793
3,805
2,586
14,309
3,428
2,910
531
870
9,356
9,342
Net Fee Income
Gains on
investment
Provision Expense(net)
Operating Expense
FB Revenue/Expense Comparison(in NT$ mn )
↑3.7%
↓9.9%
↑ 12.5%
+0.5%
↓0.2%		 20,887
20,776
1H16
1H17
1H16 1H17
1H161H17
1H161H17
1H161H17
1H161H17
Cumulative Net Revenue
1H17 Cumulative Net Revenue(in NT$ mn or %)
% of FB Net Revenue(in %)
↓32.8%
z
Item
1H16
1H17
Change
NII
66.4%
68.5%
+2.1%
Net Fee
18.3%
16.4%
-1.9%
Gain on ST Invest.
-0.2%
0.5%
+0.7%
Gain on LT invest.
2.0%
0.7%
-1.3%
Gain on fin. Products
10.7%
12.7%
+2.0%
Others
2.8%
1.2%
-1.6%
Total Revenue
100.0%
100.0%
Provision Expense (net)
-4.2%
-2.5%
-1.7%
Operating Expense
-45.0%
-44.7%
-0.3%
Income Before Tax
50.8%
52.8%
+2.0%
Net Interest Income
13,793
3,805
2,586
14,309
3,428
2,910
531
870
9,356
9,342
Net Fee Income
Gains on
investment
Provision Expense(net)
Operating Expense
FB Revenue/Expense Comparison(in NT$ mn )
↑3.7%
↓9.9%
↑ 12.5%
+0.5%
↓0.2%		 20,887
20,776
1H16
1H17
1H16 1H17
1H161H17
1H161H17
1H161H17
1H161H17
Cumulative Net Revenue
1H17 Cumulative Net Revenue(in NT$ mn or %)
% of FB Net Revenue(in %)
↓32.8%
z
Item
1H16
1H17
Change
NII
66.4%
68.5%
+2.1%
Net Fee
18.3%
16.4%
-1.9%
Gain on ST Invest.
-0.2%
0.5%
+0.7%
Gain on LT invest.
2.0%
0.7%
-1.3%
Gain on fin. Products
10.7%
12.7%
+2.0%
Others
2.8%
1.2%
-1.6%
Total Revenue
100.0%
100.0%
Provision Expense (net)
-4.2%
-2.5%
-1.7%
Operating Expense
-45.0%
-44.7%
-0.3%
Income Before Tax
50.8%
52.8%
+2.0%
Net Interest Income
13,793
3,805
2,586
14,309
3,428
2,910
531
870
9,356
9,342
Net Fee Income
Gains on
investment
Provision Expense(net)
Operating Expense
FB Revenue/Expense Comparison(in NT$ mn )
↑3.7%
↓9.9%
↑ 12.5%
+0.5%
↓0.2%		 20,887
20,776
1H16
1H17
1H16 1H17
1H161H17
1H161H17
1H161H17
1H161H17
Cumulative Net Revenue
1H17 Cumulative Net Revenue(in NT$ mn or %)
% of FB Net Revenue(in %)
↓32.8%
z
Item
1H16
1H17
Change
NII
66.4%
68.5%
+2.1%
Net Fee
18.3%
16.4%
-1.9%
Gain on ST Invest.
-0.2%
0.5%
+0.7%
Gain on LT invest.
2.0%
0.7%
-1.3%
Gain on fin. Products
10.7%
12.7%
+2.0%
Others
2.8%
1.2%
-1.6%
Total Revenue
100.0%
100.0%
Provision Expense (net)
-4.2%
-2.5%
-1.7%
Operating Expense
-45.0%
-44.7%
-0.3%
Income Before Tax
50.8%
52.8%
+2.0%
Net Interest Income
13,793
3,805
2,586
14,309
3,428
2,910
531
870
9,356
9,342
Net Fee Income
Gains on
investment
Provision Expense(net)
Operating Expense
FB Revenue/Expense Comparison(in NT$ mn )
↑3.7%
↓9.9%
↑ 12.5%
+0.5%
↓0.2%		 20,887
20,776
1H16
1H17
1H16 1H17
1H161H17
1H161H17
1H161H17
1H161H17
Cumulative Net Revenue
1H17 Cumulative Net Revenue(in NT$ mn or %)
% of FB Net Revenue(in %)
↓32.8%
z
Item
1H16
1H17
Change
NII
66.4%
68.5%
+2.1%
Net Fee
18.3%
16.4%
-1.9%
Gain on ST Invest.
-0.2%
0.5%
+0.7%
Gain on LT invest.
2.0%
0.7%
-1.3%
Gain on fin. Products
10.7%
12.7%
+2.0%
Others
2.8%
1.2%
-1.6%
Total Revenue
100.0%
100.0%
Provision Expense (net)
-4.2%
-2.5%
-1.7%
Operating Expense
-45.0%
-44.7%
-0.3%
Income Before Tax
50.8%
52.8%
+2.0%
Net Interest Income
13,793
3,805
2,586
14,309
3,428
2,910
531
870
9,356
9,342
Net Fee Income
Gains on
investment
Provision Expense(net)
Operating Expense
FB Revenue/Expense Comparison(in NT$ mn )
↑3.7%
↓9.9%
↑ 12.5%
+0.5%
↓0.2%		 20,887
20,776
1H16
1H17
1H16 1H17
1H161H17
1H161H17
1H161H17
1H161H17
Cumulative Net Revenue
1H17 Cumulative Net Revenue(in NT$ mn or %)
% of FB Net Revenue(in %)
↓32.8%
z
Item
1H16
1H17
Change
NII
66.4%
68.5%
+2.1%
Net Fee
18.3%
16.4%
-1.9%
Gain on ST Invest.
-0.2%
0.5%
+0.7%
Gain on LT invest.
2.0%
0.7%
-1.3%
Gain on fin. Products
10.7%
12.7%
+2.0%
Others
2.8%
1.2%
-1.6%
Total Revenue
100.0%
100.0%
Provision Expense (net)
-4.2%
-2.5%
-1.7%
Operating Expense
-45.0%
-44.7%
-0.3%
Income Before Tax
50.8%
52.8%
+2.0%
Net Interest Income
13,793
3,805
2,586
14,309
3,428
2,910
531
870
9,356
9,342
Net Fee Income
Gains on
investment
Provision Expense(net)
Operating Expense
FB Revenue/Expense Comparison(in NT$ mn )
↑3.7%
↓9.9%
↑ 12.5%
+0.5%
↓0.2%		 20,887
20,776
1H16
1H17
1H16 1H17
1H161H17
1H161H17
1H161H17
1H161H17
Cumulative Net Revenue
1H17 Cumulative Net Revenue(in NT$ mn or %)
% of FB Net Revenue(in %)
↓32.8%
z
Item
1H16
1H17
Change
NII
66.4%
68.5%
+2.1%
Net Fee
18.3%
16.4%
-1.9%
Gain on ST Invest.
-0.2%
0.5%
+0.7%
Gain on LT invest.
2.0%
0.7%
-1.3%
Gain on fin. Products
10.7%
12.7%
+2.0%
Others
2.8%
1.2%
-1.6%
Total Revenue
100.0%
100.0%
Provision Expense (net)
-4.2%
-2.5%
-1.7%
Operating Expense
-45.0%
-44.7%
-0.3%
Income Before Tax
50.8%
52.8%
+2.0%
Net Interest Income
13,793
3,805
2,586
14,309
3,428
2,910
531
870
9,356
9,342
Net Fee Income
Gains on
investment
Provision Expense(net)
Operating Expense
FB Revenue/Expense Comparison(in NT$ mn )
↑3.7%
↓9.9%
↑ 12.5%
+0.5%
↓0.2%
20,887
20,776
1H16
1H17
Cumulative Net Revenue
+0.5%
Item 1H16 1H17 Change
NII 66.4% 68.5% +2.1%
Net Fee 18.3% 16.4% -1.9%
Gain on ST Invest. -0.2% 0.5% +0.7%
Gain on LT invest. 2.0% 0.7% -1.3%
Gain on fin. Products 10.7% 12.7% +2.0%
Others 2.8% 1.2% -1.6%
z
Total Revenue		 100.0% 100.0%
Provision Expense (net) -4.2% -2.5% -1.7%
Operating Expense -45.0% -44.7% -0.3%
FB Revenue/Expense Comparison(in NT$ mn ) Income Before Tax 50.8% 52.8% +2.0%
↓32.8%
13,793
3,805
2,586
14,309
3,428
2,910
870
↑3.7%
↓9.9%
↑ 12.5%

Reaudited 1H16 & 1H17 full year FB statements due to Property & Casualty subsidiary re-org. into FB from July 1 of 2016. Preliminary Data.

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FB 1H17 Loan Book Mix

1H17 1H17 1H17 Loan Book1 (in NT$ bn or %)
1,494.2
1,553.0
1H16
1H17
Loan Book1
+3.9%		 Loan Book1 (in NT$ bn or %)
1,494.2
1,553.0
1H16
1H17
Loan Book1
+3.9%		 783.9
742.1
327.0
336.8
1H161H17
1H161H17
F/X↑3.0%
Commercial Loan
(Gov./SOE included)
F/X Loan
Item
1H16
1H17
Change
Consumer
28.5%
27.8%
-0.7%
Mortgage
26.8%
26.0%
-0.8%
Other Consumer Loan
1.7%
1.8%
+0.1%
Corporate Banking
71.5%
72.2%
+0.7%
Commercial Loan
(Gov./SOE included) )
49.6%
50.5%
+0.9%
--- SME
40.9%
41.7%
+0.8%
F/X/ Loan
21.9%
21.7%
-0.2%
--- Overseas
13.0%
13.0%
+0.0%
Loan Book1
100.0%
100.0%
% of Loan Book1
↑5.6%
SME2
610.6
SME2
610.6
Overseas
194.1
SME↑6.1%
Overseas
201.2
Overseas
↑ 3.7%
SME2
647.8
Item
1H16
1H17
Change
Consumer
28.5%
27.8%
-0.7%
Mortgage
26.8%
26.0%
-0.8%
Other Consumer Loan
1.7%
1.8%
+0.1%
Corporate Banking
71.5%
72.2%
+0.7%
Commercial Loan
(Gov./SOE included) )
49.6%
50.5%
+0.9%
--- SME
40.9%
41.7%
+0.8%
F/X/ Loan
21.9%
21.7%
-0.2%
--- Overseas
13.0%
13.0%
+0.0%
Loan Book1
100.0%
100.0%
400.1
25.0
403.6
28.7
1H161H17
1H161H17
↑1.0%
1H17 Loan Book1 Breakdown(in NT$ bn )
Mortgage
Other Consumer
Loan
↑ 14.8%		 783.9
742.1
327.0
336.8
1H161H17
1H161H17
F/X↑3.0%
Commercial Loan
(Gov./SOE included)
F/X Loan
↑5.6%
SME2
610.6
SME2
610.6
Overseas
194.1
SME↑6.1%
Overseas
201.2
Oversea
↑ 3.7%
SME2
647.8
1H161H17
1H161H17
Mortgage
Other Consumer
Loan

  1. Loan Book does not include NALs

  2. SME as defined by the “Act for Development of Small & Medium Enterprises; both NTD & Foreign currency loan included

13

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FB Loan Breakdown

-QoQ Comparison

FB Loan Growth(in NT$ bn) FB Loan Growth(in NT$ bn) QoQ%
+0.0%
+4.7%
+0.7%
-5.3%
+2.0%		 QoQ%
+0.0%
+4.7%
+0.7%
-5.3%
+2.0%
327.0
322.1
329.5
330.1
336.8
131.5
137.7
136.4
143.7
136.1
610.6
625.1
647.8
643.5
647.8
25.0
25.5
27.5
27.4
28.7
400.1
403.9
405.9
403.6
403.6
2Q16
3Q16
4Q16
1Q17
2Q17
SME
Mortgage
Commercial
Loan
1,494.2
1,514.3
1,547.1
1548.3
1553.0
F/X loan
Total loan
Consumer
Loan
Others		 QoQ%
+0.0%
+4.7%
+0.7%
-5.3%
+2.0%
+0.0%
+4.7%
+0.7%
-5.3%
+2.0%
2Q16
3Q16
4Q16
1Q17
2Q17

14

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FB 1H17 LDR, SPREAD &NIM

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Total Loan & LDR (in NT$ bn or % ) Total Loan [1] LDR [2]
NTD 85.3%
78.55% 77.94% 76.88% 77.30% 78.56% 79.15% 79.04% 80.48% 79.92% F/X 65.3%
1,431.1 1,468.0 1,489.5 1,482.6 1,497.3 1,517.3 1,550.8 1,552.3 1,557.1
2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
△
Loan-Deposit Spread / NIM ( in % ) Spread [3] NIM [3]
1.62% 1.61% 1.63% 1.64% 1.64% 1.64% 1.65% 1.63% 1.63%
1.28% 1.25% 1.26% 1.27% 1.26% 1.26% 1.26% 1.26% 1.26%
2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
----- End of picture text -----

  1. Total Loan = loan + import/export negotiation + NALs

  2. LDR = Total loan / Total deposit, starting from 2012, total deposit does not include structured deposit.

  3. Annual cumulative Average Spread and NIM

15

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FB 1H17 Deposit Mix

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----- Start of picture text -----

FB Deposit Structure (in NT$ bn ) FB Deposit CASA Rate (in %)
NTD Deposit F/X deposit
NTD CASA rate
1H17 Total
518.4 Deposit
492.6
$1947.7 bn △
67.09% 67.12%
65.03% 65.17%
63.82%
+2.2%
1,412.40 1,429.3
1H15 2H15 1H16 2H16 1H17
1H16 1H17
----- End of picture text -----

16

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FB 1H17 Fee Income Breakdown

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----- Start of picture text -----

1H17 Cumulative Net Fee Income (in NT$ mn or %) % of Cumulative Net Fee
Item 1H16 1H17 Change
3,428 WM [1 ] 53.5% 54.9% +1.4%
Loan-related 17.9% 17.1% -0.8%
3,805 -9.9%
F/X 11.9% 12.4% +0.5%
Credit Card 5.0% 5.6% +0.6%
1H16 1H17
Other [2] 11.7% 10.0% -1.7%
Net Fee Income Cumulative Net Fee 100.0% 100.0%
1H17 Cumulative Net Fee Breakdown ( in NT$ mn )
↓7.5%
2,035 1,882 ↓13.9%
↓ 23.7%
682 587
451 425 192 446 342
↑3.0% 191
1H16 1H17 1H16 1H17 1H16 1H17 1H16 1H17 1H16 1H17
WM Fee [1] Loan-related F/X Credit Card Other [2]
----- End of picture text -----

  1. WM Fee = Custodian Fee + Trust-related Fee + Bancassurance Fee

  2. Other represents network service fee, including overseas branches

  3. Reaudited 1H16 & 1H17 FB statements due to Property & Casualty subsidiary merged into FB from July 1 of 2016.

17

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FB 1H17 Cost-to-Income Ratio
1H17 Cumulative Operating Expense (in NT$ mn ) Cost-to-Income Ratio Analysis( in NT$ mn)
Item 1H16 1H17
9,342 Net Revenue 20,776 20,887
Operating Expense (9,356) (9,342)
9,356 -0.2% Provision(Net) (869) (531)
Income Tax (1,479) (1,572)
1H16
1H17
Operating Expense Net Income 9,072 9,442
Quarterly Operating Expense & Cumulated Cost-to-Income Ratio( in NT$ mn or % )
Net Revenue
45.03%		 Operating Expense
Cumulated Cost-to-Income Ratio
44.65%
45.65%
45.34%		 44.73%
10,078 10,682 10,245 10,026 10,861
4,584 4,732 4,990 4,546 4,796
2Q16 3Q16 4Q16 1Q17 2Q17

Reaudited 1H16 & 1H17 FB statements due to Property & Casualty subsidiary merged into FB from July 1 of 2016.

18

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FB 1H17 Asset Quality

==> picture [628 x 389] intentionally omitted <==

----- Start of picture text -----

NPL Amount, Reserve, Coverage (in NT$ mn or % )
Coverage Ratio LLR ratio (loan loss reserve/total loan, excluding gov.loan)
7 5 1 .0 3 %
6 9 2 .3 1 %
6 3 5 .7 5 % 6 2 5 .1 4 %
5 8 8 .6 7 %
5 3 7 .8 2 %
4 9 8 .4 4 %
1.40% 1.36%
1.30%
1.21% 1.22% 1.18% 1.20%
NPL Ratio NPL NPL Reserve
0.24%
0.22%
0.19% 0.19% 0.20% 0.20% 0.20%
20,738 19,932 19,451 18,276 18,973 18,205 18,561
2,761 2,879 3,060 3,105 3,035 3,385 3,724
2015 3M16 6M16 9M16 2016 3M17 6M17
----- End of picture text -----

19

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FB NPL Migration by Sectors

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----- Start of picture text -----

1
Individual & Mortgage NPL Ratios (in %) Large Corp. & SME NPL Ratios (in %)
Individual
Mortagge
Large Corp.
SME
0.29%
0.26%
0.23% 0.19% 0.26% 0.30% 0.32% 0.28% 0.35% 0.38%
0.18%
0.23%
0.22%
0.18% 0.06% 0.00% 0.00% 0.00% 0.00%
0.16%
2Q16 3Q16 4Q16 1Q17 2Q17
2Q16 3Q16 4Q16 1Q17 2Q17
Domestic NPL Ratio (in %) Overseas NPL Ratio (in %)
Domestic Overseas
0.27%
0.24%
0.23%
0.21% 0.23%
0.19%
0.19%
0.10% 0.11% 0.10%
2Q16 3Q16 4Q16 1Q17 2Q17
2Q16 3Q16 4Q16 1Q17 2Q17
----- End of picture text -----

  1. Individual: mortgage and non-mortgage loan included

  2. bad-debt recovery not included.

20

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CAR & Core Capital

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----- Start of picture text -----

FFHC Group CAR(in %)
Re-cap.
153.43%
139.14%
132.75% 131.84%
125.34% CAR
123.04% 121.24%
115.66%
statutory CAR 100%
FB CAR & Core Capital(in %)
Re-cap.
13.67% 13.46% 13.27%
12.82%
12.27%
11.50% CAR
10.90% 10.88%
Tier 1
10.93% 10.86% 10.95% 10.64%
9.45%
8.31% 8.64% 9.02%
2H13 1H14 2H14 1H15 2H15 1H16 2H16 1H17
2H13 1H14 2H14 1H15 2H15 1H16 2H16 1H17
----- End of picture text -----

  • •Leverage ceiling for holding companies in Taiwan: Double Leverage < 125% ; Debt Ratio < 30%

21

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Shareholder Return

2016
1.20
0.20
1.40
82.8%
1.40
1.45 1
2016
FFHC Earnings Per 1.10
1.20
1.35
1.18
1.18
1.43
Share ( in NT$ dollar )		 1.40
1.48		 1.40
1.45 1
2016
EPS
Dividend
2012
2013
2014		 2015
2012
2013
2014		 2015 2016
Cash dividend
0.45
0.50
0.70		 0.95 1.20
Stock dividend
0.65
0.70
0.65		 0.45 0.20
Total dividend
1.10
1.20
1.35		 1.40 1.40
CASH Payout
ratio
38.1%
42.4%
49.0%		 64.2% 82.8%
  1. EPS is adjusted retroactively for stock dividends

22

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Appendix

==> picture [720 x 27] intentionally omitted <==

FFHC Consolidated Statement of Comprehensive Income

==> picture [180 x 31] intentionally omitted <==

FFHC Consolidated Statement of Comprehensive Income (in NT$ million or %)

IFRS Year-over-Year Comparison Year-over-Year Comparison Year-over-Year Comparison Year-over-Year Comparison
~~2014~~
~~2015~~
~~2016~~
28,278
28,452
28,801
7,428
8,502
8,723
(6,533)
121
1,351
1,373
1,152
2,569
172
146
163
417
541
951
(26)
(588)
(75)
2,172
1,707
935
(6)
(10)
(39)
911
825
1,712
34,186
40,848
45,091
(4,015)
(518)
(2,244)
7,101
540
(871)
(20,789)
(21,893)
(21,779)
16,483
18,976
20,197
(2,405)
(3,014)
(2,913)
14,078
15,962
17,284
3,420
413
(2,354)
17,497
16,375
14,930
14,085
16,006
17,356
(7)
(44)
(72)
17,542
16,461
15,023
(45)
(86)
(93)
1.43
1.48
1.45		 ~~1H16~~ ~~1H17~~ ~~Change~~
Net interest income
Net service fee & commission
Net Insurance revenue
Gain on financial assets meas.
at fair value through P/L
Real estate investment gain
Gain on AFS financial assets
Income from equity invest.
Net gain on F/X
Assets impairment loss
Others
Ner Revenue
Net Provision for credit losses
Recovered(provided) for insurance res.
Operating Expense
Income from continued op. before tax
Income tax expenses
Consolidated net income		 14,293
4,566
366
1,291
50
301
(167)
74
0
1,326
22,100
(920)
(146)
(10,708)
10,326
(1,580)
8,746		 14,838
3,793
2,239
2,996
41
262
84
(239)
(34)
526
24,506
(545)
(1,961)
(10,723)
11,277
(1,669)
9,608		 3.8%
-16.9%
--
132.1%
-18.0%
-13.0%
--
-423.0%
--
-60.3%
10.9%
--
--
0.1%
9.2%
5.6%
9.9%
Other Items
Comprehensive Income		 252
8,998		 (474)
9,134		 -288.1%
1.5%
Net Income attributed to:
Parent
Minorityinterests		 8,775
(29)		 9,636
(28)		 9.8%
--
Comprehensive Income attributed to:
Parent
Minorityinterests		 8,992
6		 9,122
12		 1.4%
100.0%
EPS1(NT$)
0.72 0.79 9.7%

24

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FFHC Non-consolidated Income Statement

FFHC Standalone Income Statement Summary in NT$ million, NT$, or %

2014
2015
2016
13,904
16,431
17,857
289
213
242
14,194
16,644
18,099
(8)
(114)
(304)
(264)
(373)
(338)
(159)
(192)
(145)
13,763
15,965
17,312
14,085
16,006
17,356
0
0
0
14,085
16,006
17,356
1.43
1.48
1.45
Full Year Results		 Year-over-Year Comparison Year-over-Year Comparison Year-over-Year Comparison
1H16 1H17 Change
Operating revenues
Income from long-term investment
Other income1
Total revenues
Loss from long-term investment
Operating expenses
Other expenses and losses
Income from continued op. before tax
Income from continued op. after tax
Income from discontinued op., net of tax
Net income
EPS2(NT$)		 9,132
200
9,332
(301)
(162)
(75)
8,794
8,775
0
8,775
0.72		 9,717
203
9,920
(29)
(177)
(78)
9,636
9,636
0
9,636
0.79		 6.4%
1.5%
6.3%
-90.4%
9.3%
4.0%
9.6%
9.8%
--
9.8%
9.7%

  1. Including income other than long-term investment

  2. EPS is adjusted retroactively for stock dividends

25

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FFHC Balance Sheet

FFHC Balance Sheet Summary ~~in NT$ million or million shares~~

2014
2015
2016
167,888
197,454
203,834
172,071
201,923
205,165
18,126
14,283
13,390
153,945
187,640
191,775
2,355,709
2,500,096
2,541,156
2,201,332
2,312,109
2,349,127
154,377
187,987
192,029
153,945
187,640
191,775
432
347
254
92,593
114,611
119,769
Full Years Result		 Year-over-Year Comparison Year-over-Year Comparison Year-over-Year Comparison
1H16 1H17 Change
Non-consolidated Balance Sheet Data
Long-term investment
Total non-consolidated assets
Total liabilities
Total shareholders' equity
Conolidated Balance Sheet Data
Total consolidated assets
Total liabilities
Total shareholders' equity
Parent's shareholders' equity
Minority interests
Current shares outstanding		 197,662
208,427
22,683
185,744
2,488,308
2,302,210
186,098
185,744
354
114,611		 200,616
214,941
28,416
186,525
2,556,132
2,369,341
186,791
186,525
266
119,769		 1.5%
3.1%
25.3%
0.4%
2.7%
2.9%
0.4%
0.4%
-24.9%
4.5%

*figures may not match due to rounding

26

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FFHC Key Ratios

==> picture [37 x 386] intentionally omitted <==

FFHC Key Ratios

Full Year Results
2014
2015
2016
0.61%
0.66%
0.69%
9.53%
9.32%
9.10%
16.63
16.37
16.01
92,593
114,611
119,769
109.06%
105.23%
106.29%
125.34%
153.43%
139.14%
10.53%
7.07%
6.53%		 Year-over-Year Comparison Year-over-Year Comparison Year-over-Year Comparison
1H16 **1H17 ** Change
After-tax ROAA (Annualized ratio)
After-tax ROAE (Annualized ratio)
Book Per Share
Capital Stock
Double leverage1
Group CAR2
Debt Ratio3		 0.70%
9.36%
16.21
119,769
106.42%
131.84%
10.88%		 0.76%
10.14%
15.58
122,164
107.55%
115.67%
13.22%		 8.6%
8.3%
-3.9%
2.0%
1.1%
-12.3%
21.5%

  1. Double leverage ratio = Long-term investment / Equity

  2. Updated semi-annually.

  3. Non-consolidated basis.

27

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FB Income Statement

FB Comprehensive Income Statement Summary(Standalone) in NT$ million or %

FB Income Statement
bject to final Reviewed
FB Comprehensive Income Statement Summary(Standalone)
in NT$ million or %
2014
2015
2016
1H16
1H17
Change
Net interest income
27,138
27,496
27,797
13,793
14,309
3.7%
Net fee income
6,190
7,790
8,035
3,805
3,428
-9.9%
Net gain on ST invest.
(151)
(49)
274
(44)
104
-336.4%
Net gain on LT invest.
666
177
433
406
150
-63.1%
Net gain on other fin. products
3,496
2,823
4,344
2,224
2,656
19.4%
Other net income
181
349
654
592
240
-59.5%
Net revenue
37,520
38,586
41,537
20,776
20,887
0.5%
Operating expenses
(17,736)
(18,997)
(18,963)
(9,356)
(9,342)
-0.1%
Pre-provisiion pre-tax profit
19,784
19,589
22,574
11,420
11,545
1.1%
Provision expense
(6,161)
(3,027)
(4,396)
(1,791)
(2,265)
26.5%
Adjustment: bad-debt recovery
2,240
2,554
2,346
921
1,734
88.3%
Income before tax
15,862
19,115
20,524
10,552
11,014
4.4%
Income tax
(2,481)
(3,015)
(2,825)
(1,480)
(1,572)
6.2%
Netincome
13,381
16,100
17,699
9,072
9,442
4.1%
Other items
3,242
995
(2,099)
221
(616)
-378.7%
Comprehensiveincome
16,623
17,095
15,599
9,293
8,825
-5.0%
EPS
1.81
1.93
1.99
1.02
1.06
0.04
IFRSs
Year-over-Year Comparison

28

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FB Key Ratios

FB Key Ratios FB Key Ratios FB Key Ratios
FB Key Ratios
~~Full Year Results~~ 1H16
1H17
Change
1.64%
1.63%
-0.61%
1.26%
1.26%
0.00%
45.03%
44.73%
-0.67%
78.56%
79.92%
1.73%
0.20%
0.24%
20.00%
1.10%
1.14%
3.64%
1.30%
1.20%
-7.69%
635.75%
498.44%
-21.60%
13.46%
12.82%
-4.75%
10.86%
10.64%
-2.03%
0.76%
0.76%
0.00%
9.86%
10.00%
1.42%
~~Year-over-Year Comparison~~
2014
2015
2016
1.55%
1.63%
1.65%
1.28%
1.26%
1.26%
47.27%
49.23%
45.65%
83.03%
76.88%
79.04%
0.20%
0.19%
0.20%
1.24%
1.19%
1.16%
1.37%
1.40%
1.22%
680.71%
751.03%
625.14%		 1H16 1H17
Loan to deposit spread
Net Interest Margin
Cost to income ratio3
Loan to deposit ratio1
NPL ratio
Gross Provision ratio
LLR ratio (excluding gov. loan)
Coverage ratio		 1.64%
1.26%
45.03%
78.56%
0.20%
1.10%
1.30%
635.75%		 1.63%
1.26%
44.73%
79.92%
0.24%
1.14%
1.20%
498.44%
CAR
Tier-1		 11.50%
13.67%
13.27%
9.02%
10.93%
10.95%		 13.46%
10.86%		 12.82%
10.64%
ROAA2
0.60%
0.69%
0.72%
ROAE2
9.40%
9.56%
9.46%
1. Loan to depoist ratio = total loan / total deposit
2. Annualized figures.		 0.76%
9.86%		 0.76%
10.00%

29

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FB Loan Yields

FB Loan Yields

2014 2015 2016 2017
Q3
Q4		 Q1 Q2
Q3		 Q4 Q1 Q2
Q3		 Q4 Q1 Q2
NTD Yields & Costs
Loan Rate 2.16% 2.20% 2.18% 2.18% 2.19% 2.18% 2.06% 2.01% 1.95% 1.95% 1.91% 1.90%
Deposit Rate 0.60% 0.60% 0.59% 0.59% 0.59% 0.56% 0.52% 0.49% 0.45% 0.44% 0.43% 0.42%
Spread 1.56% 1.60% 1.59% 1.59% 1.60% 1.62% 1.54% 1.52% 1.50% 1.51% 1.48% 1.48%
FX Yields & Costs
Loan Rate 2.51% 2.29% 2.52% 2.57% 2.31% 2.74% 2.91% 2.85% 2.89% 3.00% 3.12% 3.09%
Deposit Rate 0.92% 0.84% 0.88% 0.85% 0.72% 0.83% 0.84% 0.75% 0.72% 0.73% 0.84% 0.84%
Spread 1.59% 1.45% 1.65% 1.72% 1.59% 1.91% 2.07% 2.10% 2.17% 2.27% 2.28% 2.25%

30

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FB Loan Quality

~~FB NPL Migration~~ in NT$ million or %

~~FB NPL Miration~~ ~~FB NPL Miration~~ ~~FB NPL Miration~~ ~~FB NPL Miration~~ ~~FB NPL Miration~~ ~~FB NPL Miration~~
~~g~~
in NT$ million or %
2015
2016
2,951
2,761
2,201
6,166
1,306
4,611
895
1,555
(2,391)
(5,892)
2,761
3,035
20,089
20,738
2,919
4,238
(2,391)
(5,892)
121
(111)
20,738
18,973
2,254
2,346
----
2,075
----
214
----
57
Full Year Results		 Q1
Q2
3,035
3,385
1,700
1,379
1,320
1,385
380
(6)
(1,350)
(1,040)
3,385
3,724
18,973
18,205
775
1,374
(1,350)
(1,040)
(193)
22
18,205
18,561
424
1,310
369
1,169
43
128
12
13
2017 Quarterly		 Year-over-Year Comparison
1H16 1H17 Change
NPL- beginning
Net new NPL influx
Domestic
Overseas
Net write-offs
NPL- ending balance
Allowance for loan loss- beginning
Provisions for loan loss
Net write-offs
Others
Allowance for loan loss- ending
Recovery from bad debt
Domestic
Overseas
Credit card		 2,761
3,265
2,498
767
(2,966)
3,060
20,738
1,711
(2,966)
(32)
19,451
921
862
30
29		 3,035
3,079
2,705
374
(2,390)
3,724
18,973
2,149
(2,390)
(171)
18,561
1734
1538
171
25		 9.9%
-5.7%
8.3%
-51.2%
-19.4%
21.7%
-8.5%
25.6%
-19.4%
434.4%
-4.6%
88.3%
78.4%
470.0%
-13.8%
1. Non-consolidated basis
  1. Non-consolidated basis

31

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First Sec. Operating Report

==> picture [692 x 31] intentionally omitted <==

First Sec Income Statement Summary in NT$ million or %

i
T

I
I




B


p		 Firs
n N
2014
Full Yr		 2015
2016
Full Year Results		 Year-over-Year Comparison
1H16 1H17 Change
7.2%
-1.4%
107.7%
1275.0%
-12.5%
34.6%
-5.7%
181.8%
-232.7%
-54.8%
--
-191.9%
T

I
I		 Bro
Net
Un
Pric
Oth
Tot
otal
Non-
ncom
ncom		 kerage commission
interest income
derwriting commission
iple transaction gains, net
er operating income
al operating income
operating expenses
operating income
e before tax
e tax		 803
335
38
187
63
1,426
(1,367)
54
114
(40)		 Brokerage commission
753
645
Net interest income
315
292
Underwriting commission
53
23
Transaction gains through F/V, net
217
(12)
Other operating income
125
93
Total operating income
1463
1,041
Total operating expenses
(1,363)
(1,288)
Non-operating income
64
42
Income before tax
164
(205)
Income tax
10
(24)		 333
145
13
12
32
535
(650)
11
(104)
(31)		 357
143
27
165
28
720
(613)
31
138
(14)

p		 Cum
rinci		 mulative effect of change in accounting
ples		 0 Cummulative effect of change in
accounting principles		 0 0 0
Netin come 74 Netincome 174
(229)		 (135) 124
Firs t Sec Key Ratios First Sec Key Ratios


B
 ROA
ROA
roke
Margi		 E (Annualized)
A (Annualized)
rage market share
n loan market share		 1.14%
0.40%
1.57%
2.41%		 ROAE (Annualized)
ROAA (Annualized)
Brokerage market share
Margin loan market share		 2.65%
-3.65%
0.92%
-1.30%
1.58%
1.45%
2.56%
2.99%		 -4.18%
-1.44%
1.51%
2.78%		 4.08%
1.46%
1.54%
2.95%

32

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FSITC Operating Report

FSITC Income Statement Summary in NT$ million or %

Year-over-Year Comparison Year-over-Year Comparison Year-over-Year Comparison
1H16 1H17 Change
216
3
219
(187)
5
37
(6)
31
0
31		 230
2
232
(202)
3
34
(6)
28
0
28		 6.5%
--
5.9%
8.0%
-40.0%
-8.1%
0.0%
-9.7%
--
-9.7%
y
FSITC Key Ratios
AUM
72,651
97,016
94,461
AUM Ranking
11
8
8		 95,656
10		 104,703 9.5%
--
6
  1. Non-consolidated basis

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– First Aviva Operating Report

First-Aviva Financial Results Summary ~~in NT$ million or %~~

FiAi Fiil Rl S FiAi Fiil Rl S
rst-vva nanca esuts ummary
~~in NT$ million or %~~
2014
2015
2016
1H16
1H17
Change
Income Statement Summary
Operating Revenue
14,903
11,576
7,520
3,457
6,051
75.0%
Premium Income
13,436
11,820
7,235
3,913
5,634
44.0%
Other insurance income
136
233
244
119
131
10.1%
Net Investment Income
1,331
(476)
41
(575)
286
-149.7%
Operating Cost
(14,531)
(11,164)
(7,157)
(3,295)
(5,859)
77.8%
Reinsurance commission
(20)
(27)
(34)
(16)
(19)
18.8%
Reserves
(1,623)
(2,994)
2,037
1,400
(1,752)
-225.1%
Claims
(12,230)
(7,412)
(8,502)
(4,363)
(3,694)
-15.3%
Commission
(633)
(691)
(586)
(285)
(339)
18.9%
Others
(25)
(40)
(72)
(31)
(55)
--
Operating Expenses
(397)
(501)
(513)
(221)
(269)
21.7%
Sales related expenses
(88)
(113)
(83)
(23)
(60)
160.9%
Management expenses
(309)
(388)
(430)
(198)
(209)
5.6%
Other expense
0
0
0
0
0
#DIV/0!
Profit/Loss of Operation
(25)
(89)
(150)
(59)
(77)
30.5%
Non-Operating Profit
11
0
0
0
0
--
.
Profit/Loss Before Tax
(14)
(89)
(150)
(59)
(77)
30.5%
Income tax
(1)
(1)
(3)
0
19
--
Net Income after tax
(15)
(90)
(147)
(59)
(58)
-1.7%
Key Ratios
ROAE(Annualized ratio)
-1.60%
-11.26%
-23.91%
-16.60%
-21.77%
31.1%
ROAA(Annualized ratio)
-0.05%
-0.28%
-0.45%
-0.36%
-0.36%
0.0%
FFHC claims 51% of First-Aviva operating results.
Year-over-Year Comparison
Full Year Result*
  • FFHC claims 51% of First-Aviva operating results.

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Q&A

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