09.10.2001
Taishin acquires CUTI's credit card business

• Development: Taishin International Bank plans to acquire the credit card department of China United Trust & Investment Corp (CUTI, 2827). CUTI has nearly 47k cards in circulation, with accounts receivable of more than NT$100m. Taishin is expected to pay NT$200 per card. The transaction total may amount to NT$200m.

• Analysis: Scale of CUTI’s credit card department is much smaller than Taishin’s own credit card department, with nearly 2m cards issued. However, the deal is justified by the low price per card versus card acquisition costs of NT$1,400 per card for Taishin.

• Primasia View: We believe valuation for the bank will increase on further expansion of market share.