04.2019 Cover Story
Far Eastern International Bank achieved great development in Overseas Business Opportunities for advancing to the new market
Far Eastern Magazine / Editorial Room
Taiwan has a large number of bankers with high homogeneity, and there has been over-competition in the financial market for a long time. Especially, Fagin's credit spreads are very small. In order to sustain its operation, innovation and transformation have become an inevitable direction. In order to seek new business opportunities, Far Eastern International Bank has formulated overseas development strategy. After years of hard work, it not only expands its business territory to many countries, but also makes more profits. This issue of "Cover Story" will share with you how Far Eastern International Bank's Fajin team can make good use of limited resources, focus on niche products and markets, and create a new wave of competitive advantage.
Breakthroughs in transformation across regional constraints
Cross-border financing is for banks to undertake foreign currency lending business for overseas enterprises. Because of the low competition in Taiwan's Fagin Credit, the interest margin has been below 1%. On the contrary, overseas, the interest margin of Fagin is at least twice that of Taiwan. Therefore, in recent years, most banks have made great efforts to rush overseas business. However, banking industry is a highly regulated franchise industry, and under the regulation of various financial supervision indicators, Hai has made great efforts to improve its foreign currency lending business. The growth of expansion points and risky assets is rather limited.
Nevertheless, Far Eastern International Bank still plans to enter overseas markets and set up its branch in Hong Kong as early as 2007, but the real turning point is in 2009 and 2012. Far Eastern International Bank actively solicited and nurtured outstanding talents, set up one and two financial management departments successively, developed towards Corporate Finance (CF) business, invested in joint loans, structured financing, capital market and other niche products, and provided professional, exquisite and differentiated financial services to meet enterprise customers in order to create more lucrative profits.
In 2011, Far Eastern International Bank set up the Enterprise Finance Department of Zhonggang District, set up a continental group in Hong Kong office area, focusing on the mainland customers, and formed a cross-border service elite team with the first and second part of enterprise finance department, positively laying out the legal platform of the three places on both sides of the Taiwan Strait. In 2015, a financial leasing company was established in Shanghai Free Trade Zone to handle such business as financial leasing, factoring and entrusted leasing, and further extend the service platforms of the three places across the Straits to meet all-round needs of customers.
At the same time, Far Eastern International Bank has actively cooperated with large international banks to co-sponsor or participate in Joint Lending cases and accumulate experience in international financing business. During this period, Far Eastern International Bank has successfully organized several large cross-border joint lending cases, and has worked closely with nearly 40 participating banks at home and abroad to substantially enhance Far Eastern International Leasing Corporation's visibility and expertise in the field of corporate finance. Industry image. Among them, legal gold target cases, such as "China Water Group's six-year US$100 million international syndicated loan case" in 2015, are the largest privately-owned water supply enterprise listed in Hong Kong, with an exclusive position and a warm market response, and oversubscribe more than US$4.10 million. In 2017, Hong Kong Lei Shing Hong LTD Credit Co., Ltd.'s three-year US$400 million joint loan case was jointly insured by the parent company, involving 14 international syndicates. It also received 1.5 times over-subscription and organized the largest Hong Kong case for Far Eastern International Bank. Statistics show that from 2013 to 2017, Far Eastern International Bank successfully sponsored 19 Joint Lending cases. Compared with 2013, the scale of financing in 2017 increased nearly four times. The total amount of Joint Lending in five years was as high as NT 71.8 billion yuan, and about NT 730 million yuan was charged for joint lending. Among them, from 2015 to June 2018, overseas credit assets and profits increased year by year, creating a cumulative operating profit of NT$4.7 billion.
Far Eastern International Bank, based on its good reputation among international banks and its contacts with international private equity funds for many years, has finally broken through regional restrictions and extended its business to Greater China and even to the ASEAN region. Its customers have extended to Singapore, Vietnam, Indonesia, India, Australia and Malaysia, and many indicative cases have been committed by Far Eastern International Bank. For example, CITIC Environmental Technology Limited, the flagship company of CITIC Group in the field of environmental protection, was reorganized successfully in 2016 after Far Eastern International Bank first organized the international syndicated loan in 2014. In addition, Huacheng Gas Co., Ltd., established by Warburg Pincus, a world-renowned private equity group, succeeded in raising funds from overseas syndicates for the first time in 2016. In the following year, Far Eastern International Bank successfully organized a three-year joint loan of US$9.10 million to generate considerable profits.
However, behind the glory lies the accumulation of years of honesty, diligence and prudence by Far Eastern International Bank. Limited by the fact that there is only one business base for Hong Kong branch overseas and there is no sufficient capital to support asset growth, Far Eastern International Bank can only focus on niche-based products and markets, gather high-quality talents, bring into play team warfare, cultivate the relationship between customers and financial industry in a sincere, professional and diligent manner, step by step, and gradually build a solid foundation for overseas business development.
In addition, the co-sponsoring bank has a considerable responsibility, which requires on-the-spot inspection, review, management quota and collateral, and there are higher risks in large international co-lending cases, such as commercial, financial, structural, market and regulatory risks. Fortunately, Far Eastern International Bank brings together cross-sectoral teams, carefully evaluates and resourcefully responds, and provides customized solutions in a professional rather than a regulatory manner. Price, successfully organized a number of international cross-border joint lending cases. Taking the case of Huy Vietnam Group Limited in 2017 as an example, the lender is one of the largest chain restaurants in Vietnam, with four catering brands and the largest number of stores among Vietnamese caterers. Since Far Eastern International Bank has no branch in Vietnam, when undertaking this cross-border joint lending case, it is necessary to overcome the problems of language, local industry market conditions, regulations, Joint Lending Management and collateral creation, and persuade competing counterparts with Vietnamese branches to act as management banks in Vietnam through numerous cross-border meetings and to work with internationally renowned lawyers. Under the consideration of abiding by the laws and regulations of various countries, mastering the credit risk and satisfying the needs of customers, we have rigorously structured the contents of contracts, implemented the procedures of setting relevant collateral, and successfully won the trust of customers and their peers, and created high returns. This case is an important milestone for Far Eastern International Bank to break through the restriction of no strongholds in ASEAN countries and step into the region to host the joint lending market.
In order to accelerate overseas market expansion, Far Eastern International Bank, on the one hand, has applied for additional capital of Shanghai's leasing subsidiary and planned to set up new offices in Singapore and Vietnam, which have been approved by the Financial Supervisory Commission Banking Bureau, which will help to understand the local financial environment and future development opportunities. Far Eastern International Bank takes asset growth and business expansion as its main objective this year. With the brilliant results of the past two years, the financial business opportunities of overseas enterprises will be promising in the future.
