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News Releases |
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| To announce the use of funds and its projected effectiveness from Yuanta Securities Finance Company's capital reduction application |
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- Date of occurrence of the event:2010/12/29
- Company name: Yuanta Financial Holding Co,, Ltd
- Relationship to the Company (please enter "head office" or "affiliate company"):head office
- Reciprocal shareholding ratios: None
- Cause of occurrence: The NTD 16.5 billion capital reduction application of Yuanta Securities Finance Company (a subsidiary company of Yuanta Financial Holdings) is approved by the Financial Supervisory Commission. We hereby announce the use of funds from capital reduction and its projected effectiveness.
- Countermeasures: NA
- Any other matters that need to be specified:
The use of funds from capital reduction and its projected effectiveness are as follows:
(1)Repayment of Short-term Debt NTD3.8 billion loan Yuanta Securities Finance Company's current short-term loan balance is approximately NTD3.8 billion, interest rate is estimated to be within the range of 0.588%~0.638%. After repayment of short-term loan, it is estimated that the debt ratio can be decreased from approximately 13.47% to 10.89%, allowing Yuanta Financial Holdings to save around 23 million of finance expense each year.
(2)Increase working capital by NTD 12.7 billion
The amount of NTD 12.7 billion will be used for future mergers and acquisitions, development of insurance and new businesses, or as capital injection fund for subsidiary companies. The amount will first be allocated for transaction of Commercial Bill, investment of time deposit and other financial market instruments. This will allow the company, Yuanta Financial Holdings, to increase its liquidity ratio from 19.86% to 198.04% and decrease its double leverage ratio from 113.08% to 98.56%. In addition, it is estimated that there will be an additional gain of NTD 61 million of finance income each year.
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