Cathay Financial Holding (2882) investor relations material

Executive summary

• Net income for Q1 2026 was NT$31.7 billion, a record high and a significant turnaround from a net loss of NT$6.51 billion in Q1 2025, driven by strong insurance and banking segment performance and favorable market conditions.

• Adjusted net income reached NT$48.6 billion, reflecting robust core business momentum and including FVOCI equity disposal gains.

• All major subsidiaries—banking, life, general insurance, asset management, and securities—delivered record or near-record first quarter earnings, with Cathay Life's adjusted net income at the second-highest historical level.

• Wealth management fees increased 13% year-over-year, and asset quality remained sound.

• Board approved a cash dividend of NT$3.5 per share, with a 49.6% payout ratio and 4.7% yield at announcement.

Financial highlights

• Consolidated net income for Q1 2026 was NT$31.7 billion; adjusted net income was NT$48.6 billion.

• EPS for Q1 2026 was NT$2.15; adjusted EPS was NT$3.31.

• Consolidated net worth increased significantly to NT$1,256.7 billion, with adjusted net worth at NT$1,051.4 billion.

• Consolidated ROE reached 16.9%; all major subsidiaries posted double-digit ROE.

• IFRS 17 adoption in 2026 changed financial asset valuation and comparability; adjusted earnings include FVOCI equity disposal gains.

Outlook and guidance

• Double-digit loan growth targeted for the full year, with strong momentum in foreign currency loans.

• Net interest margin expected to expand in 2026 due to favorable economic developments.

• IFRS 17 transition enhances earnings transparency and predictability, with CSM release becoming a key driver of future earnings.

• Life insurance new business CSM on track to meet full-year target of NT$75 billion, with 36% achieved in Q1.

• Credit costs projected to remain stable at around 25 basis points.