Cathay Financial Holding (2882) Q4 2024 earnings summary

Executive summary

• Net income for 2024 reached TWD 111.2 billion, up 116% year-on-year, marking the second highest profit in company history and EPS at TWD 7.29.

• All major subsidiaries delivered strong results, with record earnings at Cathay United Bank, Cathay Century, Asset Management, and Securities; Cathay Life posted its second highest profit.

• Book value and BVPS increased year-on-year, supported by robust earnings and equity market gains.

• Total assets increased to TWD 13.77 trillion, up 7.5% from the end of 2023.

• The group completed the disposal of Conning Holdings Limited, resulting in a gain from discontinued operations.

Financial highlights

• Consolidated operating income grew 7% year-on-year to TWD 262.1 billion; net income surged 116% to TWD 111.2 billion.

• Cathay United Bank achieved 32% year-on-year earnings growth, with net interest income up 18% and net fee income up 34%.

• Cathay Life's annualized premiums and value of new business grew 22% and 30% year-on-year, respectively.

• Cathay Century's premium income grew 13% year-on-year, with a market share of 13.6%.

• EPS was TWD 7.29; consolidated ROE reached 13.02%, with all subsidiaries achieving double-digit ROEs.

Outlook and guidance

• Expect high single-digit loan growth across all banking segments in 2025, with benign asset quality and credit cost around 30 basis points.

• Full-year NIM expected to remain at 1.55%, assuming stable Taiwan rates and a 50bps Fed cut.

• Focus on expanding wealth management, credit card, and cross-border banking businesses.

• Life insurance to focus on CSM accumulation and protection-type products, with FYP growth in traditional and USD-denominated products.

• IFRS 17 and ICS adoption expected to reduce liability cost and make earnings more predictable, with annual CSM release to net income projected to grow 10%-15% over the next five years.