06.22.2001
Competition intensifies in loan market

• Development: Chiao Tung Bank admits that loan market is very competitive and that it will be difficult to maintain loan growth levels achieved last year.

• Analysis: We have adjusted bank’s loan growth down to about 4.5% this year. Net profits have also been revised downward to NT$5.8bn due to higher than expected provisions for bad debts.

• Primasia View: Nonetheless, we believe the stock remains undervalued after we take into account unrealized profits of NT$24bn (approx. NT$10/sh) as at end-May.

WilliamFong@Primasia.com +886-[0]2-2547-8864