Latest SinoPac Securities News
Aug 12, 2021
Bank warns of market dip if tax cut ends UNFOUNDED FEARS: Not all day traders would leave the local stock market if the rate returns to its pre-2017 level, a Financial Supervisory Commission official said By Kao Shih-ching / Staff reporter Turnover on the local stock market might decline by as much as 30 percent if a day trading tax cut, set to end next year, is not extended, SinoPac Financial Holdings Co (永豐金控) said yesterday. “If the government decides not to extend a 50 percent tax cut for day trading transactions, local securities brokers would be affected, as day trading transactions account for more than 40 percent of overall turnover,” SinoPac president Stanley Chu (朱士廷) told an investors’ conference in Taipei. “We estimated that turnover would fall by a range of 15 to 30 percent,” Chu said. SinoPac Financial Holdings Co president Stanley Chu speaks at a financial forum in Taipei on May 5. Photo: Chang Chia-ming, Taipei Times It is possible that average daily turnover, which is about NT$300 billion to NT$400 billion (US$10.78 billion to US$14.38 billion), would retreat to NT$200 billion to NT$300 billion after the incentive ends, SinoPac chief economist Jack Huang (黃蔭基) said. The Financial Supervisory Commission has offered its assessment about the effects that ending the day trading tax cut extension would have on the local stock market to the Ministry of Finance, Securities and Futures Bureau Deputy Director-General Tsai Li-ling (蔡麗玲) told a videoconference. “It is not reasonable to assume that all day traders would leave the trading table if the tax rate is to be raised back to 0.003 percent. How much the day trading transactions would wane would primarily depend on the listed companies’ fundamentals or the economic conditions,” Tsai said. The ministry would make the final decision about whether to extend the tax incentive for day trading transactions, she said. The program — which reduces taxes on day trading transactions from 0.003 percent to 0.0015 percent — took effect in April 2017 and is to end next year. SinoPac Financial yesterday reported that net profit at its brokerage unit, SinoPac Securities Co (永豐金證券), expanded 33 percent annually to NT$1.37 billion last quarter, which accounted for 33 percent of the company’s NT$4.15 billion in profit. The company’s main profit driver, Bank SinoPac (永豐銀行), posted an annual decrease of 16 percent in net profit to NT$2.69 billion due to a decline in investment income. For the first half of this year, net profit at SinoPac Securities soared 156 percent year-on-year to NT$2.41 billion, while that of Bank SinoPac grew 23 percent to NT$5.88 billion, company data showed. SinoPac Financial attributed SinoPac Securities’ robust growth to higher net fee income earned by helping conduct share transactions or margin trading transactions amid booming stock markets. Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.