Operations
1. Business operations
(1)We have crafted a carefully conceived business roadmap designed to meet a short-term objective (to reap latent synergies within the group) and a mid-term goal (to develop into a top-flight financial holding company).
(2)Working within the framework of our business roadmap, we have developed a fundamental strategy and a specific plan for implementing it. These will provide guideposts for the management of TFH and its subsidiaries.
(3)Working in coordination with government policy, we have adopted a vital strategy and a program of action that will enable TFH, as a state-run financial holding company, to play a leading role in the market.
2. Cross-border initiatives
(1)In order to foster a strong cadre of financial holding company managerial talent and improve our business management techniques, we sent an observation team to Japan to study how groupwide management is practiced at the Mizuho Financial Group and its banking subsidiaries. While at Mizuho, the team focused on issues such as target management for subsidiaries, groupwide performance management, integrated marketing, the establishment of joint platforms, the use of human resources, and risk management systems.
(2)To help build up TFH into an Asia-Pacific wealth management center, we have arranged for our banking subsidiary to enter into partnerships with famous European financial services groups. These partnerships should enable the banking subsidiary to increase the sophistication of its financial management know-how on a number of different fronts. In addition to learning new marketing strategies and means of promotion, it should also be able to strengthen its product lines and cooperative marketing channels, and establish a back office operations center as well as a foreign exchange electronic trading platform.
(3)We have arranged for the banking subsidiary to establish strategic partnerships with several world-class banks so that it can gradually pick up new models of product development and marketing, new ways of employee training, new channel strategies, and new techniques for carrying out overseas mergers and acquisitions. These breakthroughs will help our subsidiaries move more quickly toward the goal of establishing a more international style of management.
(4)To expand our overseas markets, the Bank of Taiwan, a TFH subsidiary, has received permission from Taiwan’s financial supervisory authority to apply for approval to open branches in Hanoi and Macao, and is also assessing the possibility of establishing branch units in cities located in the Asia-Pacific region or overseas locations with a high concentration of Taiwan-invested companies. At the same time, we are also working on foreign market development strategies for the life insurance and securities subsidiaries, so as to expand the group’s reach and increase its earning power.
3. Integration of group resources
(1)We have established an integrated information systems (IS) resources platform for the entire TFH group. The IS operations at the Bank of Taiwan form the core of the integrated platform. The Bank of Taiwan services the needs of TFH as well as BankTaiwan Securities and BankTaiwan Life Insurance, providing them with IS personnel, equipment, facilities, maintenance, and administration services. Integration of IS resources has enabled us to reap the benefits of synergy by synchronizing and sharing group resources.
(2)We have established an integrated platform for groupwide financial information. It is a group intranet with a “Financial Information Section,”a “New Products Section,”and a “Laws and Regulations Section.” (Phase-one construction of the Laws and Regulations Section is now complete.) Employees can access this intranet when they need information related to these topics.
(3)We have established a platform that enables all TFH subsidiaries to make coordinated allocation and shared use of common resources, and integrates management of the group’s general affairs procurement via the Bank of Taiwan’s procurement and supply system. These synergies mean reduced overhead for TFH.
4. Enhanced benefits from groupwide management
(1)To make the group more competitive, we have established systems of target management for subsidiaries as well as management and evaluation of subsidiary performance.
(2)We have asked our subsidiaries to adopt annual business plans and business targets, and we act on a monthly basis to monitor their operations and check whether they are achieving their earnings targets. This ongoing vigilance helps to enhance the group’s overall performance.
(3)When a particular unit experiences a drop-off in performance, we ask it to assess the causes, adopt response measures, and report to the board of directors for review.
5. Cross-selling synergies
(1)We have established a system for cooperative marketing of life insurance products in order to reap the synergies of cross-selling.
(2)We have marketed our life insurance products to home loan customers in order to improve the group’s penetration rate and increase the value of the group’s customer base.
(3)We have engaged in cooperative marketing of our securities services in order to expand the banking subsidiary’s customer base and bring in more on-line trading orders and orders from institutional clients.
6. Risk management
(1)We have established a legal compliance system, and stepped up measures to educate employees about laws and regulations and familiarize them with ethics rules.
(2)We have implemented a strict risk management system that includes monthly monitoring of the group’s risk exposures, and the provision of quarterly reports to the board of directors.
(3)We have designed Basel II-compliant risk management systems to bring our practices in line with international standards.
7. Corporate social responsibility
(1)In support of government policy, we acted to reduce carbon emissions, conserve energy and water, and recycle, and encouraged employees to sign an online Carbon Reduction Declaration.
(2)We have coordinated a response by employees of TFH and its subsidiaries to provide disaster relief donations following the major earthquake in Sichuan.
(3)Our subsidiaries have taken concrete actions to show concern for those in need. The Bank of Taiwan has made donations to numerous children’s homes, for example, while BankTaiwan Life Insurance has held scholarship drawings for the children of its policyholders. In these and many other ways, we give back to society by supporting charity.