First Financial Holding posts record Q1 profit, raises loan targets on AI boom

Taiwan's robust economic performance, bolstered by the burgeoning AI industry, has propelled First Financial Holding to achieve a record net profit in the first quarter. The company's outlook remains optimistic, with revised projections indicating strong growth for the remainder of the year.

First Financial reported a first-quarter net profit after tax of NT$8.24 billion (approximately $250 million USD), marking a 26.5% year-on-year increase and setting a new record for the period. This surge is attributed to the combined strength of its core banking and securities businesses. Subsidiary First Bank contributed NT$7.57 billion, up 11.7%, while First Securities saw a remarkable 325.8% profit jump to NT$511 million, boosting the contribution of non-banking subsidiaries to 12% of total profits.

Key drivers of this performance include a 22.4% year-on-year increase in net interest income, fueled by a 10.8% expansion in total loan balances to NT$2.95 trillion. The company has consequently raised its full-year loan growth target from an initial 5% to between 9% and 10%. Net fee income also grew by 13.7%, supported by a 17.1% increase in wealth management business.

Looking ahead, First Financial anticipates continued double-digit growth in net revenue. While the company notes a potential decrease in swap income due to regulatory changes affecting the insurance industry's hedging practices, it expects overall financial investment income to remain stable. The company also forecasts a slight moderation in the housing market, with prices showing resilience in prime Taipei areas but potential minor corrections in other regions. The "New Youth" mortgage program, however, continues to see strong uptake, with applications up 30% year-on-year.

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Benefiting from Taiwan's strong economic growth momentum and a vibrant capital market, the bank's three profit pillars have grown simultaneously. First Bank has revised its loan growth target for this year upwards, from the previously estimated 5% to 9%-10%, and is optimistic about the full-year profit outlook, with net revenue expected to maintain double-digit growth and set new records.