(bloomberg: 2880 tt)...1 2015/8/18 hnfhc 2q 2015 analyst meeting (bloomberg: 2880 tt) senior vice...

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2015/8/18

HNFHC 2Q 2015 Analyst Meeting (Bloomberg: 2880 TT)

Senior Vice President & General Manager

Mr. King-huo Lu

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• This document is provided by Hua Nan Financial Holdings Co. Ltd. (“HNFHC”). The information contained in this document is not audited or reviewed by any accountant or any independent expert. HNFHC makes no warranties or representations expressly or impliedly as to the fairness, accuracy, completeness or correctness of such information or opinions. The document is provided as of the date herein and will not be updated to reflect any change hereafter. No responsibility is accepted by HNFHC, its affiliates and their representatives, no matter for their negligence or any other reason, for any loss or damages arising from the use of this document or the information contained herein or anything related to this document.

• This document may contain forward-looking statements, including but not limited

to all statements that address activities, events or developments that HNFHC expects or anticipates to occur in the future, which is based on the projects of HNFHC toward the future, and various factors and uncertainness beyond HNFHC’s control. Therefore, the actual results may differ materially from those contained in the forward-looking statements.

• This document do not constitute a public offer under any applicable legislation or

an offer to sell or solicitation of an offer to buy any securities or financial instruments.

• This document may not be directly or indirectly reproduced, redistributed or

forwarded to any other person and my not be published in whole or in part for any purpose.

Disclaimer

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Operating Results – HNFHC……...…....P.7

Operating Results – Subsidiaries……...P.10

Asset Quality…………………………......P.20

Outlook………………..………………......P.24

2Q2015 Highlights………………..……...P.4

Agenda

4

2Q2015 Highlights

5

Performance

HNFHC steady rise in profits

Group’s core earnings HNCB’s Net Interest Income grew 8% YoY. From NT$11,963 million in 6M2014 to NT$12,973 million in 6M2015.

As both wealth management and credit card business maintained its growth momentum, therefore HNCB fee income grew 4% YoY, from NT$2,766 million in 6M2014 to NT$2,882 million in 6M2015.

HNCB Overall Spread Were Effectively improved

By effectively adjusting loan books, HNCB’s Overall Spread were widen compared to the year ago. Overall spread rose 3bp from 1.40% in 2Q2014 to 1.43% in 2Q2015.

Group’s Cross Selling Efforts Continues to Pay Off

SCIC’s Growth Written Premium rose 5.68% YoY to NT$4,279 million in 6M2015, far outpaced the industry’s average of 1.89%. Market share also rose to 6.24% in 6M2015 from 6.01% in 6M 2014.

2Q2015 Highlights-1

Note：Both 2Q2015 and 6M2015 figures were preliminary based on IFRS. The others were audited based on IFRS.

6

Asset Quality &

Capital Levels

Asset Quality Remain Superior Than the Industry Average NPL ratio in Jun 2015 was at 0.21%, compared to 0.31% in Jun 2014.

Coverage ratio rose from 404.17% in Jun 2014 to 528.72% in Jun 2015. Both NPL ratio and Coverage ratio remain superior than the industry average of 0.25% and 501.14% in Jun 2015. Reserve to loan ratio in Jun 2015 was 1.16%.

Adequate Capital levels HNCB CAR stood at 12.37%, Tier 1 stood at 9% in Jun 2015. HNFHC

CAR stood at 138.79%.

Greater China

HNCB Total RMB deposits were RMB$9,205 million in Jun 2015. Shenzhen branch recorded a pre tax profit of NT$129 million in Jun 2015

compared to NT$80 million in Jun 2014, represented 61% growth YoY. China’s 3nd branch in Fuzhou, Fujian Province was officially opened on

13th of May, 2015.

HNSC HNSC BoD approved to included Fuhsin Securities in Yunlin County

under HNSC umbrella on 30th of March, 2015. HNSC will continue the strategy to look for M&A targets of local independent securities firm to enlarge brokerage market share.

2Q2015 Highlights-2


7

Operating Results – HNFHC

8

(NT$mn or NT$ dollar) 1Q2015 2Q2015 QoQ 6M2014 6M2015 YoY

Net income 3,666 3,919 7% 6,325 7,585 20%

Total assets 2,262,312 2,268,449 0% 2,175,501 2,268,449 4%

Book value 147,792 145,921 -1% 136,158 145,921 7%

EPS 0.39 0.42 8% 0.68 0.81 19%

Book value per share 15.84 15.64 -1% 15.03 15.64 4%

Capital stock 93,280 93,280 0% 90,563 93,280 3%

ROA(%) 0.65 0.69 0.04 0.58 0.67 0.09

ROE(%) 10.05 10.47 0.42 9.31 10.47 1.16

CAR(%) 139.55 138.79 -0.76 133.10 138.79 5.69

Double Leverage Ratio(%) 110.46 108.41 -2.05 111.03 108.41 -2.62

Debt/Equity Ratio(%) 11.06 14.96 3.9 13.17 14.96 1.79

HNFHC-Net Income Grew Both QoQ and YoY


9

(NT$mn)

1Q2015

Net

Income

2Q2015

Net

Income

QoQ

6M2014

Net

Income

6M2015

Net

Income

YoY

HNCB 3,526 3,744 6% 5,823 7,270 25%

HNSC 150 124 -17% 418 274 -34%

SCIC 136 179 32% 317 315 -1%

HNIT 7 5 -29% 9 12 33%

HNVC 0 (6) n/a (29) (6) n/a

HNAMC 0 28 n/a 29 28 -3%

Total 3,819 4,074 7% 6,567 7,893 20%

Net income contribution (6M2014) Net income contribution (6M2015)

Subsidiaries-Operating Results


10

Operating Results - Subsidiaries

11

124.35

58.2372.7

2014 6M2014 6M2015

Net Income

9.23% 8.82%10.43%

0.58% 0.55% 0.66%

2014 6M2014 6M2015

ROE (after tax) ROA (after tax)

5.68% 5.70% 5.59%

6.00%5.81%

5.89%

2014 6M2014 6M2015

Deposits Loans

12.84% 12.20% 12.37%

8.98% 8.84% 9.00%

2014 6M2014 6M2015

CAR Tier 1

Note：6M2015 figures were preliminary based on IFRS. The others were audited based on IFRS.

HNCB-Operating Results

Profitability Market Share

Returns CAR & Tier I

Unit: NT$100mn

12

871,567

2,766

11,963

1371,165

2,882

12,973

NII Fee Income Financial Assets and

Liabilities

Others

6M2014 6M2015

+8%

+4%

Net Revenue

6M2014 6M2015 YoY

16,383 17,157 + 5 %

-26% +57%

Unit: NT$mn

HNCB-Net Interest Income Grew 8% YoY


13

0.72%

1.99%

1.99% 1.99% 1.99%1.99%

1.98% 1.99%

1.99%

1.99%

0.61% 0.61% 0.60%

0.60% 0.60% 0.60% 0.59%0.59%

0.61%

1.38% 1.38% 1.38% 1.38% 1.39% 1.39% 1.39%1.40% 1.40%

1.96%

2.17%2.01%

1.96%

2.33%2.25%

2.18% 2.34%2.32%

0.75%0.75%0.73%0.72%

0.72%0.53%0.49%0.46%

1.50%1.45%1.48%

1.47%1.58%1.52%1.46% 1.62%1.57%

2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 3Q2014 4Q2014 1Q2015 2Q2015

Lending Rate (NTD) Deposit Rate (NTD) Spread (NTD)

Lending Rate (FX) Deposit Rate (FX) Spread (FX)

1.41% 1.39% 1.40% 1.39% 1.40% 1.42% 1.43% 1.42%

1.43%

1.09% 1.11%1.10%1.09% 1.11%1.10%1.09%

1.09%

1.11%

2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 3Q2014 4Q2014 1Q2015 2Q2015

Spread (Overall) NIM

Spread (FX) YoY+16bp

Spread (NTD) YoY+1bp

HNCB-Spread Has Effectively Widen

Spread (Overall) YoY+3bp

14

1,849

6,689 7,227 7,052

5,564 5,698 5,762

1,862 1,867

2Q2014 1Q2015 2Q2015

Overseas & OBU Corporate Consumer

YoY +4 %

Loan-Deposit Ratio 2Q2014 3Q2014 4Q2014 1Q2015 2Q2015 79.91% 81% 81.53% 80.04% 79.72%

40%

47%

13%

49%

38%

13%

48%

39%

13%

14,663

9,101 9,441 9,426

5,260 5,323 5,343

2Q2014 1Q2015 2Q2015

Demand Deposit Time Deposit

37% 36%

63% 64%

14,115 14,361

36%

64%

14,764 14,792 14,769

HNCB-Loans Grew 4% YoY Unit:NT$100mn

NTD Deposits Breakdown Total Loans Breakdown

NTD Demand Deposit Ratio 64 %

15

631

2,248

4,163

10

4,953

809

597

2,274

3,808

10

4,848

716

1,8621,849

2Q2014 2Q2015

Overseas & OBU

Other Consumer

Mortgage

Other Corp. Loan

SME

Large Corp.

Government

14,663

5 %

16 %

34 %

15 %

4 %

28 %

34 %

6 %

14,115

+2%

+6%

YoY +4 % -0.6%

+9%

13 %

5 %

27 %

13 %

+13%

-1%

HNCB-SME Loans Grew Strongly Unit:NT$100mn

Government

SME

Large Corp.

Overseas & OBU

Mortgage

Other Consumer

16

237148220

582

1,579

157217

552

1,711

245

Wealth

Management

F/X Loans Cards Others

6M2014 6M2015

Net Fee Income

6M2014 6M2015 YoY

2,766 2,882 + 4 %

-5%

+8%

+6% +3% -1%


Unit: NT$mn

HNCB-Wealth Management Fee Income Grew 8% YoY

17

390350

2,304 2,914

5,572 5,597

6M2014 6M2015Employee Benefits Depreciation and amortizationOther general admin expenses

8,266 8,861

YoY + 7%

8,266 8,861

17,15716,383

6M2014 6M2015

Net Revenue Operating Expenses

50.45% 51.65%

YoY + 1.2%


Unit: NT$mn

HNCB- Cost Income Ratio

Operating Expenses Cost-Income Ratio

18

5.77 4.18

2.74

2014 6M2014 6M2015

Net Income

7.34%

4.99%4.62%

2.13% 1.98%2.94%

2014 6M2014 6M2015

ROE(after tax)

ROA(after tax)

2.94%2.81%

2.58%

2014 6M2014 6M2015

Brokerage

3.46% 3.50%3.47%

2014 6M2014 6M2015

Margin Lending

HNSC-Operating Results

Profitability Brokerage Market Share

Returns Margin Lending Market Share

Unit: NT$100mn


19

5.82%6.01%

6.24%

2014 6M2014 6M2015

Written Premium Market Share

59.07%63.74%62.56%

32.37%31.22%33.82%

2014 6M2014 6M2015

Net Claim Ratio Net Expense Ratio

15.44%17.69%

16.22%

3.90% 4.35% 4.03%

2014 6M2014 6M2015

ROE(after tax) ROA(after tax)

96.38% 94.96% 91.44%

76.52

40.49 42.79

2014 6M2014 6M2015

Written Premium

SCIC-Operating Results


Gross Written Premium Unit: NT$100mn

Returns

Market Share

Net Combined Ratio

20

Asset Quality

21

6M2014 6M2015 YoY

Provision 2,146 551 - 74 %

Write-Off 1,506 1,002 - 33 %

Recovery 835 705 - 15 %

Reserve 17,901 16,318 - 9 %

4433 28 29 31

0

50

100

2Q14 3Q14 4Q14 1Q15 2Q15

YoY -1.3 Billion

0.31%

0.23%0.19%

0.20% 0.21%404.17%

507.70%

585.79% 566.11%528.72%

200%250%300%350%400%450%500%550%600%650%700%750%800%850%

0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

2Q14 3Q14 4Q14 1Q15 2Q15

NPL ratio Coverage ratio

HNCB-Asset Quality Stable

Unit: NT$mn


NPL Unit: NT$100mn

NPL Ratio & Coverage Ratio

22

YoY -0.49%

0

4

0 0 00

5

2Q14 3Q14 4Q14 1Q15 2Q15

25 20 15 16 17

0.66%0.51%

0.38% 0.38% 0.42%

051015202530

0.00%0.25%0.50%0.75%1.00%1.25%

2Q14 3Q14 4Q14 1Q15 2Q15

63 4 3

5

02468

10

2Q14 3Q14 4Q14 1Q15 2Q15

YoY -0.24%

13 7 72 2

0.56%0.31% 0.28%

0.11% 0.07%

0

5

10

15

20

0.00%

0.50%

1.00%

1.50%

2.00%

2Q14 3Q14 4Q14 1Q15 2Q15

HNCB-Corp. NPL

Large Corp. NPL ratio & NPL

Unit: NT$100mn

SME NPL ratio & NPL

Unit: NT$100mn

Large Corp. New NPL formation

Unit: NT$100mn

YoY-100 million Unit: NT$100mn

SME New NPL formation

23

4 4 46

9

0.09% 0.09%0.09%

0.13%

0.18%

0

2

4

6

8

10

0.00%0.25%0.50%0.75%1.00%1.25%1.50%

2Q14 3Q14 4Q14 1Q15 2Q15

1 1 1

3 3

0

1

2

3

4

2Q14 3Q14 4Q14 1Q15 2Q15

YoY +0.09%

HNCB-Mortgage NPL Unit: NT$100mn

Mortgage NPL ratio & NPL Mortgage New NPL formation

YoY +200 million

24

Outlook

25

Strategy & Achievement

A First-Class

Regional Financial Holding Company 4. Boost Cross-Selling Capabilities

26% of subsidiary's business is contributed by cross-selling

1. Diversify Source of Income 33% of HNFHC income were from non interest income

2. Balance Group’s Profit Contribution 8% of revenue contributed by non-bank subsidiaries

Vision Strategy and Achievement in 2Q2015

3. Expand Overseas Operation 25% of HNCB revenue were from overseas networks

5. Strengthen Capital Levels HNFHC CAR：138.79%

HNCB CAR：12.37% & HNCB Tier 1：9%

26

HNCB & Other

Subsidiaries

HNCB The existing unused office space has leased out which is expect to generate

an additional rental income of NTD$200 million per year.

HNCB will continue the effort to collaborate the existing branches and sub-branch in China to boost profitability. In addition, HNCB is evaluating carefully on the possibilities of turning the existing branches into a subsidiary bank in China.

Moreover, HNCB will apply its Hanoi Rep. office to become a branch, as well as setting up Rep. office in Myanmar and Tokyo.

Outlook

HNSC Domestically, HNSC will continue to look for M&A targets of local

independent securities firm to enlarge brokerage market share. Internationally, continue to look for local JV partners to establish a securities firm JV under ECFA in the declared financial reform zones. Moreover, developing products and services for the anticipate launch of “Shenzhen-Hong Kong Stock Connect” in the end of year.

SCIC

Continue the setup effort with our P&C JV partner-China’s leading automobile aftermarket leader MIT Group.

27

Q & A

28

Appendix

29

HNFHC Condensed Consolidated Income Statements

Expressed In Millions of New Taiwan Dollars, Except Earnings Per Share

2013 2014 Change 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 Change 6M2014 6M2015 Change

(%) (%) (%)

Interest Income 35,316 39,285 11.24% 9,570 9,980 10,191 10,045 10,128 0.83% 19,114 20,173 5.54%

Interest Expense (12,084) (13,762) 13.89% (3,429) (3,411) (3,494) (3,433) (3,402) -0.90% (6,857) (6,835) -0.32%

Interest Income, Net 23,232 25,523 9.86% 6,141 6,569 6,697 6,612 6,726 1.72% 12,257 13,338 8.82%

Service fee and commission income, net 6,354 7,510 18.19% 1,827 1,946 1,882 1,828 1,837 0.49% 3,682 3,665 -0.46%

Income from insurance premiums, net 2,194 2,301 4.88% 651 618 404 765 807 5.49% 1,279 1,572 22.91%

Gains(losses) on financial assets and

liabilities at fair value through profit or

loss

3,253 4,156 27.76% (776) 788 2,006 (785) (672) -14.39% 1,362 (1,457) -206.98%

Realized gains(losses) of available-for-

sale financial assets760 676 -11.05% 169 429 (12) 214 102 -52.34% 259 316 22.01%

Realized gains or losses on held-to-

maturity financial assets0 0 - 0 0 0 0 0 - 0 0 -

Share of the profit or loss of associates

and joint ventures(6) (5) -16.67% 1 (1) (5) (2) 0 -100.00% 1 (2) -300.00%

Gains on investment properties 272 274 0.74% 55 61 84 47 105 123.40% 129 152 17.83%

Foreign exchange gains, net (1,184) (2,124) 79.39% 1,279 (511) (1,579) 1,157 926 -19.97% (34) 2,083 -6226.47%

Impairment loss (106) (89) -16.04% (59) (17) (8) 0 2 - (64) 2 -103.13%

Other non-interest income 753 595 -20.98% 279 165 75 142 271 90.85% 355 413 16.34%

Net Income Excluding Interest Income 12,290 13,294 8.17% 3,426 3,478 2,847 3,366 3,378 0.36% 6,969 6,744 -3.23%

Net Revenues 35,522 38,817 9.28% 9,567 10,047 9,544 9,978 10,104 1.26% 19,226 20,082 4.45%

Bad-debt expenses (3,875) (1,640) -57.68% (302) (259) (45) (126) 248 -296.83% (1,336) 122 -109.13%

Provisions for the insurance reserve (117) (307) 162.39% (124) (152) 128 (249) (210) -15.66% (283) (459) 62.19%

Operating Expenses (19,645) (21,321) 8.53% (5,271) (5,559) (5,582) (5,296) (5,543) 4.66% (10,180) (10,839) 6.47%

Employee Benefits (12,958) (13,952) 7.67% (3,527) (3,582) (3,526) (3,352) (3,418) 1.97% (6,844) (6,770) -1.08%

Depreciation and amortization (933) (923) -1.07% (229) (238) (216) (219) (215) -1.83% (469) (434) -7.46%

Other general and administrative expenses (5,754) (6,446) 12.03% (1,515) (1,739) (1,840) (1,725) (1,910) 10.72% (2,867) (3,635) 26.79%

Consolidated income before income tax

from continuing operations11,885 15,549 30.83% 3,870 4,077 4,045 4,307 4,599 6.78% 7,427 8,906 19.91%

Income Tax Expense (1,834) (2,418) 31.84% (563) (610) (706) (641) (680) 6.08% (1,102) (1,321) 19.87%

Consolidated net income 10,051 13,131 30.64% 3,307 3,467 3,339 3,666 3,919 6.90% 6,325 7,585 19.92%

Basic earnings per share 1.11 1.41 27.03% 0.35 0.37 0.36 0.39 0 7.69% 0.68 0.81 19.12%

Other comprehensive income 310 1,491 380.97% 289 136 843 185 (6) -103.24% 512 179 -65.04%

Othe comprehensive income for the

period, net of income tax10,361 14,622 41.13% 3,596 3,603 4,182 3,851 3,913 1.61% 6,837 7,764 13.56%

Attributable to：

Owner of the Company 10,051 13,131 30.64% 3,307 4,115 2,691 3,666 3,919 6.90% 6,325 7,585 19.92%

Non-controlling interests 0 0 - 0 0 0 0 0 - 0 0 -

Period (IFRSs)Quarter (IFRSs)Year (IFRSs)

30

HNFHC Condensed Balance Sheets

Expressed In Millions of New Taiwan Dollars, unless otherwise indicated


Balance Sheets (%) (%) (%)

Investments accounted for using equity method 148,872 158,940 6.76% 150,857 154,604 158,940 162,941 157,876 -3.11% 150,857 157,876 4.65%

Total assets 150,825 159,999 6.08% 154,088 155,484 159,999 164,131 167,747 2.20% 154,088 167,747 8.86%

Total liabilities 15,165 16,057 5.88% 17,931 15,724 16,057 16,341 21,828 33.58% 17,931 21,828 21.73%

Total Stockholders' equity 135,660 143,942 6.10% 136,157 139,760 143,942 147,790 145,919 -1.27% 136,157 145,919 7.17%

-

Consolidated Balance Sheets

Total assets 2,164,729 2,259,951 4.40% 2,175,501 2,220,890 2,259,951 2,262,312 2,268,449 0.27% 2,175,501 2,268,449 4.27%

Total liabilities 2,029,068 2,116,007 4.28% 2,039,343 2,081,129 2,116,007 2,114,520 2,122,528 0.38% 2,039,343 2,122,528 4.08%

Total Stockholders' equity

Parent stockholders' equity 135,660 143,942 6.10% 136,157 139,760 143,942 147,790 145,919 -1.27% 136,157 145,919 7.17%

Minority Interest 1 2 100.00% 1 1 2 2 2 0.00% 1 2 100.00%

Capital Stock 90,563 93,280 3.00% 90,563 93,280 93,280 93,280 93,280 0.00% 90,563 93,280 3.00%


31

HNFHC Condensed Income Statements


2013 2014 Change 2014Q3 2014Q4 2015Q1 2015Q2 Change 6M2014 6M2015 Change

Operating Income (%) (%) (%)

Income from investments

accounted for using equity

method

10,603 13,672 28.94% 3,610 3,494 3,819 4,075 6.70% 6,568 7,894 20.19%

Other revenue 19 26 36.84% 13 (1) (1) 1 -200.00% 14 - -100.00%

Operating Expenses (361) (395) 9.42% (118) (100) (108) (112) 3.70% (177) (220) 24.29%

Interest and Other

Expenses And Losses(213) (163) -23.47% (39) (44) (44) (45) 2.27% (80) (89) 11.25%

Income before income tax 10,048 13,140 30.77% 3,466 3,349 3,666 3,919 6.90% 6,325 7,585 19.92%

Income after income tax 10,051 13,131 30.64% 3,466 3,340 3,666 3,919 6.90% 6,325 7,585 19.92%

Basic earnings per

share(before tax) 1.11 1.41 27.03% 0.37 0.36 0.39 0.42 7.69% 0.68 0.81 19.12%

Basic earnings per

share(after tax) 1.11 1.41 27.03% 0.37 0.36 0.39 0.42 7.69% 0.68 0.81 19.12%


32

HNFHC Key Financial Ratios

UNIT：%


ROA(after tax) 6.89 8.45 1.56 8.30 8.52 8.45 9.05 9.26 0.21 8.30 9.26 0.96

ROE(after tax) 7.58 9.39 1.81 9.31 9.48 9.39 10.05 10.47 0.42 9.31 10.47 1.16

Double Leverage Ratio (Note1) 109.97 110.64 0.67 111.03 110.84 110.64 110.46 108.41 -2.05 111.03 108.41 -2.62

Capital Adequacy Ratio (Consolidated basis) (Note2) 137.77 139.55 1.78 133.10 133.10 139.55 139.55 138.79 -0.76 133.10 138.79 5.69

Note1：Double Leverage Ratio=Long-term Investment/Stockholders' Equity

Note2：Revise semiannually.


33

HNCB Condensed Income Statements

Expressed In Millions of New Taiwan Dollars, Except Earnings Per Share

2013 2014 Change 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 Change 6M2014 6M2015 Change

(%) (%) (%)

Interest Income 34,573 38,474 11.28% 9,345 9,362 9,761 10,006 9,816 10,464 6.60% 18,707 20,280 8.41%

Interest Expense (11,805) (13,538) 14.68% (3,370) (3,374) (3,358) (3,436) (3,371) (3,936) 16.76% (6,744) (7,307) 8.35%

Interest Income, Net 22,768 24,936 9.52% 5,975 5,988 6,403 6,570 6,445 6,528 1.29% 11,963 12,973 8.44%

Service fee and commission income, net 4,804 5,726 19.19% 1,437 1,329 1,420 1,540 1,454 1,428 -1.79% 2,766 2,882 4.19%

Gains(losses) on financial assets and liabilities at fair value through profit or loss 385 105 -72.73% 237 68 (19) (181) (38) (46) 21.05% 305 (84) -127.54%

Realized gains(losses) of available-for-sale financial assets 565 325 -42.48% 50 89 216 (30) 173 52 -69.94% 139 225 61.87%

Realized gains or losses on held-to-maturity financial assets 0 0 - 0 0 0 0 0 0 - 0 0 -

Share of the profit or loss of associates and joint ventures 200 261 30.50% 44 50 88 79 94 79 -15.96% 94 173 84.04%

Financial assets carried at cost 226 204 -9.73% 0 132 72 0 0 125 - 132 125 -5.30%

Foreign exchange gains, net 1,414 1,763 24.68% 493 299 451 520 299 309 3.34% 792 608 -23.23%

Impairment loss 8 3 -62.50% (3) 0 3 3 0 0 - (3) 0 -

Gains on investment properties 218 212 -2.75% 54 54 51 53 58 60 3.45% 108 118 9.26%

Other non-interest income 327 104 -68.20% 9 78 8 9 94 43 -54.26% 87 137 57.47%

Net Income Excluding Interest Income 8,147 8,703 6.82% 2,321 2,099 2,290 1,993 2,134 2,050 -3.94% 4,420 4,184 -5.34%

Net Revenues 30,915 33,639 8.81% 8,296 8,087 8,693 8,563 8,579 8,578 -0.01% 16,383 17,157 4.72%

Bad-debt expenses (3,794) (1,616) -57.41% (1,012) (299) (252) (53) (111) 265 -338.74% (1,311) 154 -111.75%

Provisions for the insurance reserve 0 0 - 0 0 0 0 0 0 - 0 0 -

Operating Expenses (15,954) (17,427) 9.23% (4,017) (4,249) (4,507) (4,654) (4,367) (4,494) 2.91% (8,266) (8,861) 7.20%

Employee Benefits (10,630) (11,400) 7.24% (2,722) (2,850) (2,857) (2,971) (2,750) (2,847) 3.53% (5,572) (5,597) 0.45%

Depreciation and amortization (765) (762) -0.39% (201) (189) (196) (176) (177) (173) -2.26% (390) (350) -10.26%

Other general and administrative expenses (4,559) (5,265) 15.49% (1,094) (1,210) (1,454) (1,507) (1,440) (1,474) 2.36% (2,304) (2,914) 26.48%

Income before income tax from continuing operations 11,167 14,596 30.71% 3,267 3,539 3,934 3,856 4,101 4,349 6.05% 6,806 8,450 24.16%

Income Tax Expense (1,596) (2,161) 35.40% (476) (507) (550) (628) (575) (605) 5.22% (983) (1,180) 20.04%

Net income 9,571 12,435 29.92% 2,791 3,032 3,384 3,228 3,526 3,744 6.18% 5,823 7,270 24.85%

Basic earnings per share 1.52 1.84 21.05% 0.44 0.42 0.50 0.48 0.52 1 5.77% 0.86 1.07 24.42%

Other comprehensive income 370 1,378 272.43% 237 253 162 726 127 (109) -185.83% 490 18 -96.33%

Total comprehensive income for the period 9,941 13,813 38.95% 3,028 3,285 3,546 3,954 3,653 3,635 -0.49% 6,313 7,288 15.44%


34

HNCB Condensed Balance Sheets



(%) (%) (%)

Assets

Cash and cash equivalents, due from the

Central Bank and other banks170,216 190,535 11.94% 200,707 191,745 190,535 210,045 243,370 15.87% 200,707 243,370 21.26%

Financial assets at fair value through profit or

loss, net40,288 50,430 25.17% 48,058 52,601 50,430 47,020 50,507 7.42% 48,058 50,507 5.10%

Available-for-sale financial assets, net 80,368 86,970 8.21% 90,785 91,633 86,970 81,849 87,779 7.25% 90,785 87,779 -3.31%

Held-to-maturity financial assets, net 310,881 266,975 -14.12% 251,418 267,520 266,975 267,170 270,481 1.24% 251,418 270,481 7.58%

Investments accounted for using equity

method1,420 2,011 41.62% 1,790 1,902 2,011 2,094 1,961 -6.35% 1,790 1,961 9.55%

Receivables, net 32,884 28,906 -12.10% 28,942 32,499 28,906 26,155 34,122 30.46% 28,942 34,122 17.90%

Loans, net 1,406,613 1,477,976 5.07% 1,398,313 1,425,103 1,477,976 1,465,854 1,453,098 -0.87% 1,398,313 1,453,098 3.92%

Plant, property, and equipment 28,560 29,762 4.21% 28,839 29,083 29,762 29,969 30,184 0.72% 28,839 30,184 4.66%

Other assets 47,220 77,335 63.78% 76,265 80,620 77,335 80,591 44,552 -44.72% 76,265 44,552 -41.58%

Total Assets 2,118,450 2,210,900 4.36% 2,125,117 2,172,706 2,210,900 2,210,747 2,216,054 0.24% 2,125,117 2,216,054 4.28%

Liabilities

Deposits and remittances 1,740,829 1,831,117 5.19% 1,768,902 1,777,595 1,831,117 1,850,371 1,841,706 -0.47% 1,768,902 1,841,706 4.12%

Other liabilities 246,927 239,863 -2.86% 223,794 259,144 239,863 216,803 235,586 8.66% 223,794 235,586 5.27%

Total Liabilities 1,987,756 2,070,980 4.19% 1,992,696 2,036,739 2,070,980 2,067,174 2,077,292 0.49% 1,992,696 2,077,292 4.25%

Stockholders' Equity 130,694 139,920 7.06% 132,421 135,967 139,920 143,573 138,762 -3.35% 132,421 138,762 4.79%

Total Liabilities and Stockholders' Equity 2,118,450 2,210,900 4.36% 2,125,117 2,172,706 2,210,900 2,210,747 2,216,054 0.24% 2,125,117 2,216,054 4.28%


35

HNSC Condensed Income Statements



(%) (%) (%)

Operating Revenue

Commissions And Fees - Brokerage 1,229 1,519 23.60% 383 421 528 187 351 292 -16.81% 804 643 -20.02%

Commissions And Fees - Underwriting 31 41 32.26% 6 12 13 10 8 2 -75.00% 18 10 -44.44%

Gains(Losses) on sales of securities (45) 98 -317.78% 59 95 (50) (6) 97 60 -38.14% 154 157 1.95%

Stock affairs agent fees 26 28 7.69% 6 7 8 7 6 6 0.00% 13 12 -7.69%

Interest Income,Net 575 633 10.09% 153 156 165 159 164 170 3.66% 309 334 8.09%

Dividend income 80 168 110.00% - 5 170 (16) - - - 14 7 -50.00%

Gains(Losses) on valuation of securities 61 (10) -116.39% 1 63 (125) 51 8 (83) -1137.50% 64 (75) -217.19%

Gains(Losses) on warrants issued (17) 4 -123.53% (6) (7) 18 (1) 5 21 320.00% (13) 26 -300.00%

Commissions And Fees - Futures 32 (6) -118.75% 6 8 - 16 - - - 14 9 -35.71%

Gains(Losses) on derivative instruments (13) 12 -192.31% 1 (1) (19) 31 (12) 16 -233.33% 0 4 -

Others 12 2 -83.33% 4 (2) 6 (6) 10 14 40.00% 2 24 1100.00%

Operating Revenue 1,971 2,489 26.28% 612 767 700 410 637 514 -19.31% 1,379 1,151 -16.53%

Operating Expenses (1,887) (2,005) 6.25% (468) (520) (635) (382) (501) (470) -6.19% (989) (971) -1.82%

Others Nonoperating Gains Or Loss 294 182 -38.10% 23 47 47 65 40 107 167.50% 70 147 110.00%

Income (Loss) Before Income Tax From

Continuing Operations378 666 76.19% 167 294 112 93 176 151 -14.20% 460 327 -28.91%

Income Tax Expense (65) (89) 36.92% (19) (23) (29) (18) (26) (27) 3.85% (42) (53) 26.19%

Net Income (Loss) 313 577 84.35% 148 271 83 75 150 124 -17.33% 418 274 -34.45%

Other Comprehensive Income (149) 176 -218.12% (3) 55 27 97 27 131 385.19% 52 158 203.85%

Total Comprehensive Income For The Year 164 752 358.54% 145 326 110 171 177 255 44.07% 470 432 -8.09%

EPS 0.39 0.71 82.05% 0.18 0.34 0.10 0.09 0.19 0.15 -21.05% 0.52 0.34 -34.62%

Total Assets 27,787 26,371 -5.10% 29,753 29,183 29,365 28,224 27,252 27,252 0.00% 29,183 27,252 -6.62%

Total Liabilities 16,503 14,523 -12.00% 18,324 17,618 17,689 16,376 15,373 15,373 0.00% 17,618 15,373 -12.74%

Total Stockholder's Equity 11,284 11,847 4.99% 11,429 11,565 11,676 11,848 11,880 11,880 0.00% 11,565 11,880 2.72%

ROE(After Tax) 2.78% 4.99% 2.21% 5.22% 7.34% 5.83% 4.99% 5.06% 4.62% -0.44% 7.34% 4.62% -2.72%

ROA(After Tax) 1.22% 2.13% 0.91% 2.06% 2.94% 2.34% 2.13% 2.16% 1.98% -0.19% 2.94% 1.98% -0.96%

Standalone basis

Year (IFRSs) Quarter (IFRSs) Period (IFRSs)

36

SCIC Condensed Income Statements



(%) (%) (%)

Operating Revenue 5,456 5,780 5.94% 1,404 1,427 1,485 1,464 1,519 1,635 7.64% 2831 3,154 11.41%

Operating Cost (3,417) (3,885) 13.70% (939) (953) (1,055) (938) (1,049) (1,093) 4.19% (1892) (2,142) 13.21%

Gross Profit Margin 2,039 1,895 -7.06% 465 474 430 526 470 542 15.32% 939 1,012 7.77%

Operating Expense (1,220) (1,240) 1.64% (284) (291) (318) (347) (316) (338) 6.96% (578) (654) 13.15%

Operating Net Income (Loss) 819 655 -20.02% 181 183 112 179 154 204 32.47% 361 358 -0.83%

Nonoperating Gains (Loss) (8) 8 -200.00% 6 2 7 (7) - - - 11 2 -81.82%

Income (Loss) Before

Income Tax from

continuing operations

811 663 -18.25% 187 185 119 172 154 206 33.77% 372 360 -3.23%

Income Tax Benefit (Expense) (115) (92) -20.00% (33) (22) (13) (24) (18) (27) 50.00% (55) (45) -18.18%

Net Income (Loss) 696 571 -17.96% 154 163 106 148 136 179 31.62% 317 315 -0.63%

Other Comprehensive Income 78 (64) -182.05% (12) (21) (49) 18 32 (25) -178.13% (33) 7 -121.21%

Total Comprehensive Income For The Year 774 507 -34.50% 142 142 57 166 168 154 -8.33% 284 322 13.38%

EPS 3.48 2.85 -18.10% 0.77 0.81 0.53 0.74 0.68 0.89 30.88% 1.58 1.57 -0.63%

Total Assets 14,171 15,098 6.54% 14,691 15,005 15,242 15,098 15,514 16,136 4.01% 15,005 16,136 7.54%

Total Liabilities 10,606 11,269 6.25% 10,983 11,402 11,583 11,269 11,516 12,199 5.93% 11,402 12,199 6.99%

Total Stockholder's Equity 3,565 3,829 7.41% 3,708 3,603 3,659 3,829 3,998 3,937 -1.53% 3,603 3,937 9.27%

ROE(After tax) 21.26% 15.44% -5.82% 16.94% 17.69% 15.61% 15.44% 13.90% 16.22% 2.32% 17.69% 16.22% -1.47%

ROA(after tax) 5.02% 3.90% -1.12% 4.27% 4.35% 3.84% 3.90% 3.55% 4.03% 0.48% 4.35% 4.03% -0.32%

Standalone basis

Year (IFRSs) Quarter (IFRSs) Period (IFRSs)

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