Taipei, June 8 (CNA) Shares in Cathay Financial Holding Co., one of Taiwan's leading financial firms, remained resilient despite a plunge on the broader market Friday as investors took their cue from the impressive growth in net profit at the company in the first five months of this year.
Cathay Financial shares closed unchanged at NT$55.00 (US$1.85) with 13.88 million shares changing hands on the Taiwan Stock Exchange, where the weighted index (the Taiex) ended down 0.85 percent at 11,156.42, led by the bellwether electronics sector.
Dealers said the stock remained resilient throughout the session even though selling on the broader market escalated, most notably in the afternoon session, pushing the Taiex down by more than 100 points at one point on Friday.
Dealers added that investors held onto Cathay Financial shares during the session after the company reported an almost 70 percent year-on-year increase in net profit for the January-May period.
In a statement released on Thursday, Cathay Financial said its net profit for the first five months of this year totaled NT$32.55 billion, up 69 percent from a year earlier, with earnings per share at NT$2.57.
Dealers said Cathay Financial adopted effective hedging measures to deal with the negative effects of Taiwan dollar volatility against the U.S. dollar so its bottom line improved significantly.
According to Cathay Financial, Cathay Life Insurance Co., the flagship insurance entity of the financial holding company,has assigned NT$16.1 billion in provisions for foreign exchange losses as of May and even if the Taiwan dollar continues to be volatile, it has a sufficient buffer to minimize foreign exchange losses.
In May Cathay Financial posted NT$5.1 billion in net profit, up from NT$4.2 billion in April.
Cathay Life posted NT$3.02 billion in net profit in May and its aggregate net profit for the first five months of the year stood at NT$21.9 billion, up 124 percent from a year earlier. In addition, Cathay Life's first year premium hit NT$14.8 billion in May, the highest among Taiwan's life insurance companies, Cathay Financial said.
Source: Focus Taiwan News Channel