Wing Hang sets sights on asset acquisitions
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Wing Hang Bank will continue to look for acquisition opportunities in Hong Kong, Macau and the mainland after its HK$1.4 billion purchase of a car financing company two months ago, according to chairman and chief executive Patrick Fung Yuk-bun.
Mr Fung unveiled his expansion plan as he reported a 23.1 per cent rise in net profit last year to a record HK$1.66 billion, or HK$5.65 per share. The bank will pay a final dividend of HK$2 per share.
'When opportunity arises, Wing Hang Bank will not miss the chance to expand by acquisitions,' Mr Fung said. 'We have the capital and experience needed in mergers and acquisitions and we are interested to look at buying opportunities in financial institutions in Hong Kong, Macau, or China.'
The bank in January paid HK$1.4 billion for Inchroy Credit Corp, a car financing firm, from BankAmerica International Financial Corp and Inchcape Hong Kong. The deal followed the HK$4.8 billion purchase of Mizuho Financial Group's Chekiang First Bank in 2003.
Mr Fung said the Inchroy acquisition would provide a profit of more than HK$20 million from the car financing business this year and strengthen the bank's consumer lending business.
'In the past two decades, we have diversified our business lines so we have a wide range of financing - from credit card, mortgage lending, car financing, stock broking and corporate financing,' he said.
Operating income rose 12.1 per cent last year to HK$2.93 billion due to loan growth and an increase in stockbroking commissions and wealth management business. Stockbroking commission income surged 82.7 per cent, while wealth management commission income gained 18.9 per cent.
Loan provisions declined 98.6 per cent to HK$800,000 from HK$54.1 million a year earlier, thanks to the improving economy and rising property prices. The bank plans to hire 100 employees this year in the mainland. Its expansion plans include capital investment of about HK$1 billion to set up a subsidiary bank in Shenzhen that will provide yuan business for mainlanders, sub-branches in Shenzhen and Guangzhou and upgrading its Beijing representative office to a branch.