Dear investors, welcome to the quarterly earnings result of E.SUN Financial Holding Company for the second quarter of 2025. At the beginning, I will invite Sarah Chen, the Vice CFO of E.SUN. She will give us a short opening note. Then I will hand it over to Martin. He will walk us through the presentation. First, Sarah, please say some words to our investors.
Hi, investors. E.SUN delivered a strong performance in the first half of 2025, marking a record high in net profit for any single half. Solid growth across all core business pieces, coupled with high- single-digit growth in overseas profit. In the first half, net fee income set a new record high, growing at a rate of 7.7% Y-o-Y. Wealth management fee income also achieved a record high, in which bancassurance grew by 33%. Last week, we announced the financial result of July. Growth rate of net profit for the first seven months was 30.9%. Net fee income continued to grow. We are optimistic about our performance this year and expecting to achieve good results. With well execution of cost management, C/I ratio decreased to 46.9% in the first half. E.SUN will continue to strictly control the growth rate of expense to single- digit for the whole year.
For overseas expansion, overseas branches and subsidiaries net profit continue to grow. FSC has approved the application of Toronto branch, Mumbai branch, and Dallas rep office. E.SUN will continue to expand our footprint across Asia Pacific. PGIM SITE has officially become the subsidiary of E.SUN in July. E.SUN is among the first financial institutions to enter the Asia Asset Management Center in Kaohsiung. We are optimistic about the synergy between bank, securities, and asset managers. Further expand the wealth management business and engagement with high net wealth individuals. E.SUN's outstanding performance has received recognition from international institutions. We are highly commended by The Asset as the best private bank for high net worth individuals in 2025. E.SUN has been listed in top 5% in corporate governance assessments by Taiwan Stock Exchange for the tenth consecutive year. We will continue to deliver value to our shareholders.
Thank you for your listening.
Thank you, Sarah, for the summary of the quarterly results. I will have my colleague, Mr. Martin Lin. He will walk us through the presentation.
Hi, dear investors. This is Martin. Today, I will begin the presentation with the summary of E.SUN Financial Holding Company on slide page number four. In the first half, both E.SUN Financial Holding Company and E.SUN Bank had a very steady growth of the asset. The total asset of both Financial Holding Company and E.SUN Bank is TWD 4.1 trillion. For the key financials indicators, the book value per share of E.SUN Financial Holding Company is TWD 15.54, and the double leverage ratio is 114.96%. For the Financial Holding Company's CAR ratio, it was 133.12%. For the physical channels domestically, E.SUN Bank runs 138 branches in Taiwan. For the overseas channel, we run 33 overseas operating sites in 11 countries. For the E.SUN Securities branch, remains the same at 17 branches. On page five is the business and financial review of Q2 2025.
For the financial performance, the net revenue of my E.SUN Financial Holding Company was TWD 43.1 billion, which grew by 19.3% year-on-year. The net profit was TWD 16.8 billion, which grew by 31.9% year-on-year. For the Financial Holding Company's EPS is TWD 1.5, and the ROE is 13.35%, and ROA is 0.81%. For the subsidiaries, E.SUN Bank net profit first half of 2025 is TWD 16.9 billion, which grew by 46%. Move on to the business development. The loan balance reached TWD 2.4 trillion, which grew by 9.1%, in which the corporate loan grew by 12.6%. The SME loan grew by 8.4%. On the retail side, the consumer loan grew by 6.9%. On the deposit balance, which grew by nearly 8% year-on-year.
For the net fee income, the first half net fee income was TWD 14.2 billion, which grew by 7.7% and set a new record high for the same period. For the wealth management fee was TWD 7.1 billion, grew by 2.9%, also set a new record high. For the asset quality, E.SUN keeps a very benign asset quality. The NPL ratio is 0.14%. The coverage ratio is 835%. For the business highlight this quarter, as Sarah mentioned, the PGIM SITE has become a subsidiary of E.SUN Financial Holding Company since July 1st, further completing E.SUN's business landscape. E.SUN is awarded with the best SME bank in Taiwan by Euromoney for a second consecutive year. For the ESG, the E.SUN Financial Holding Company is ranked top 5% in the corporate governance assessment by the TAIEX for the 10th consecutive years.
Our Chairman, Joseph Huang, is awarded with responsible business leadership by the Enterprise Asia for the eighth consecutive years. On page six, we use four graphs to illustrate E.SUN's financial performance. On the top of the slide, you can see the net profit and the EPS all set a record high on the first half of 2025. ROE and ROA are all the best performance in the past five years. Move on to page seven, is the net income breakdown of the Financial Holding Company. As you can see on the left-hand side, the pie chart shows that E.SUN Bank remains a main contributor of the Financial Holding Company, which contributes to nearly 96% of the total profit. Of course, momentum for the E.SUN Bank is very strong.
As you can see on the right-hand side, the growth rate of the E.SUN Bank, it was 46% year-over-year. Next page, on page eight, is the net income breakdown of the Financial Holding Company. Again, E.SUN follows the golden rule of the growth, which our net profit growth is larger than the net revenues growth, in which is larger than our operating expense growth. On page nine, page nine shows the revenue breakdown of the Financial Holding Company. If you look at the left-hand side, the pie chart shows the net interest income accounts for 44.5% of the total net revenue, and the net fee income accounts for 32.9%, and the other income accounts for 22.6%. On the right-hand side, you can see that across all the revenue sectors all deliver a very decent growth.
On page 10 is the net fee income breakdown of the Financial Holding Company. As you can see from the pie chart on the left-hand side, the wealth management accounts for 50% of the net fee income. On the right-hand side, you can see the growth rate of wealth management, it was nearly 13%, and that was after a third consecutive year of double-digit growth. We still deliver a very decent growth in the wealth management business. On page 11, is the capital adequacy ratio of both Financial Holding Company and the bank. Both Financial Holding Company and E.SUN Bank maintain its capital ratio at a very adequate level. The CAR ratio of Financial Holding Company is 133.12%, and the Tier 1 ratio for the bank is 13.74%. Move on to the subsidiaries. First, we'll take a look at the E.SUN Bank.
On page 13 is the deposit and loan structure of E.SUN Bank. The total deposit grew by 7.9% year-on-year, and the total loan grew by 9.1% year-on-year. For the foreign currency deposit, which grew by 6.4%, and the foreign currency loans grew by 9.1%. If we denominate the foreign currency deposit and loans in the U.S . dollars, the foreign currency deposit and the loan grew by 15.5% and 18.4% respectively. On next page, on page 14, shows the loan profile breakdown of E.SUN Bank. E.SUN has a very diverse loan structure, with our large corporate loan, SME loan, mortgage loan, and the secured personal loan, all accounts for around 20%-25%. On the right-hand side, you can see that across all the loan categories, we all have a very decent growth in the first half of 2025.
On page 15, we would like to highlight the SME loan and foreign currency loan of E.SUN Bank. E.SUN Bank is ranked the number one in the SME loan balance among the private banks in Taiwan. The growth rate of SME loan is very steady. For the foreign currency loan, as I just mentioned, if we denominate in U.S. dollars, the foreign currency loan is still very strong in the first half of 2025. On page 16, is the overseas development of E.SUN Bank. Overseas branches and the subsidiaries net profit grew by 9.8% and contribute to around 25% of the total net profit. The loan balance of the overseas branches and subsidiaries grew by 6%. Again, if we denominate in the U.S. dollars, the overseas loan balance grew by 15% year-on-year. On page 17, shows the deposit structure of E.SUN Bank.
On the left-hand side, the overall LDR is 70.5%, the LDR for the foreign currency is 38.3%, which has been increasing in the past years. On page 18 is the NIM and spread. E.SUN's NIM has remained at a very flat level in the past quarters, around 1.28%-1.3%. On the right-hand side, you can see that the spread has been improving over the past few quarters. That's thanks to the well management of cost funding control. The overall deposit rate, you can see at the bottom line there, we have lowered our deposit rate by 16 basis points in the past year. On page 19 is the wealth management fee breakdown of E.SUN Bank. The bancassurance right now accounts for 44% of the total wealth management fee income, the mutual fund accounts for around 36%.
On the right-hand side, you can see the growth rate of the bancassurance. It was 33% in the first half of 2025. That's also after three consecutive years of double-digit growth, we still deliver 33%, which is a very strong performance. On page 20 is the credit card business breakdown. For active card, E.SUN now has [4.88 million and nearly 5 million ] of active card. The market share, it was around 13%. For the card consumption, for the first seven months, the consumption is nearly TWD 400 billion, which is a new record high for the first seven months. On page 21 is the asset quality of E.SUN Bank, E.SUN keeps a very benign asset quality. The NPL ratio is 14 basis points in the first half of 2025, the coverage ratio is 835%.
For the credit cards, E.SUN's credit cards remain flat at around 16 basis points. The next page, on page 22, is the asset quality comparing with the market. E.SUN keeps a very benign asset quality, which is lower than the market average. On page 23 is the cost-to-income ratio of E.SUN Bank. Thanks to the very well management of the cost control, right now, the E.SUN Bank's cost-to-income ratio is 46.9%, which has been improving since 2022 from nearly 6% to now, it's around 46.9%. Last is for E.SUN Financial Holding's other subsidiaries. On page 25 is the E.SUN Securities. The net profit of E.SUN Securities slightly declined in the first half of 2025, that's due to the lower trading volume of the market.
However, the ROE of the E.SUN Securities is 19.3%, which is still among the top three among all the security houses under the financial holding companies. On page 26 is the performance of PGIM SITE. PGIM SITE has officially become a subsidiary of E.SUN Financial Holding Company in July, it has issued two ETF products in 2025 and is also one of the first foreign SITE company to issue such product. Also, it's one of the first SITE company to enroll in the Taiwan Individual Savings Account- Class Fund program. We hope that with the join of the PGIM SITE, we can further expand E.SUN's wealth management and also our financial landscape. On page 27 is the sustainable development of E.SUN Financial Holding Company.
E.SUN continue its effort on the ESG, we keep gaining recognitions on the international stage, E.SUN will continue to pioneer in the ESG development. That will be the presentation of second quarter, now we can head into the Q&A session. Thank you.
Thank you, Martin, for the presentation. Now we're entering the Q&A session. Please fill in your questions in the dialog box, we will answer the questions one by one. Thank you. Hi, investors. Now we have the first question coming in. It's about if we have changed or make any revision on our guidance for this year. I will invite Sarah to answer this question.
Since the NT dollar appreciation, we slightly revised our guidance regarding to the loan growth was slightly revised to 7%-8% growth. For the total deposit growth, the growth rate is around 5%-6%. As for wealth management, we still would like to maintain double-digit growth for this year. In foreign currency loans, the growth rate is still at 18.4%, for the foreign currency deposit, the growth rate is around 15.5%. In foreign currency, the growth momentum is quite strong. Because of the NT dollar appreciation, there's some impact on the growth rate. As for the rate forecast in U.S. market, we think the U.S. economic situation remains uncertain due to tariffs. Coupled with weak labor market data, we think the Fed will cut interest rates in September and December. For Taiwan's inflationary pressure is mild.
Tariffs will bring some uncertainties in the market. Taiwan Central Bank is unlikely to relax its control measures in housing markets. We expect that Taiwan Central Bank will remain interest rates flat until the end of this year. Regarding the NIM, we still expect the NIM can be increased by 2 basis points to 3 basis points at the end of this year, mainly due to continued control of funding costs and the normalization of yield curves and the potential for investment book to lock in higher interest rate spreads. We will keep improving our NIM in the future. For the Q2 NIM, due to the abundance of NT dollars funds, the market interest rates fell around 10 basis points to 20 basis points. Along with the NSFR spread is narrow, so it goes slightly down to the Q2 NIM.
We believe it can be recovered if we keep doing the three measures as we mentioned before.
Okay. Thank you, Sarah. Now we have the second question coming in. It's about the tariff's impact and how it will impact the industries of Taiwan. Basically, the tariff that is going to be imposed for Taiwan is going to be 20% on top of the basic tariff, which ranges from 10%-20%. The total number would be around 30%, but it varies across different industries. We also did a survey across different industries. For some industries, especially in the traditional manufacturing sector, including steel, screws and bolts, and hand tools or textiles. These sectors are more sensitive to the tariff impacts. Also, for these sectors, the exporting proportion to the U.S. are also higher, ranging from 10%-30%.
If we try to quantify the total exposure for the manufacturing in traditional industry sectors for the companies whose exporting percentage to the U.S. more than 30% of its revenue is U.S. exporting oriented. The credit exposure to these companies is about TWD 16 billion, and these are more sensitive, more fragile to the U.S. tariff. The number is only TWD 16 billion, which accounts for less than 0.8% of the total loans of E.SUN. If we further expand the range to all the companies who have U.S. exporting numbers, the total credit exposure is about TWD 60 billion, which accounts for 2.4% of the total loan of E.SUN. I want to emphasize, this is just a number that we try to quantify to give you a ballpark of the maximum impact to E.SUN.
As of now, we do not see significant signs of asset quality deterioration. At the same time, we will keep close eye on how the asset quality changes over time, and we will monitor the development of the impact from the tariffs. So far, the asset quality is still benign, and we do not see too much sign of asset quality deterioration. Thank you .
We have the next question coming in. It's about the synergy that we expect from PGIM SITE after it joins E.SUN Financial Holding Company. We expect PGIM to add more value to E.SUN, especially on the wealth management or the asset management business of E.SUN. With more than 30 years of history, PGIM SITE has been running in Taiwan. It has amassed a lot of experience in running asset management business in Taiwan.
We are very positive that it will bring a lot of value to E.SUN. First is on the policy aspect. The government is encouraging the asset management business to grow in Taiwan. In Kaohsiung Asia Bay District, the Asia Asset Management Center, E.SUN has established the bank and the security and the asset management company in this center. In the future, we are very optimistic in the asset management company, and it will play a more important role for E.SUN. Secondly is that PGIM SITE, it has a very diversified and very broad product lines, including mutual fund, ETF, discretionary mandate, and advisory services. In turn, it will help E.SUN to enhance our capability in delivering more diverse services or products to our customers. Thirdly is PGIM has its legacy from Prudential Group, so it will continue to maintain very good relationship with PGIM.
We expect PGIM SITE, or in the future it will be called E.SUN Asset Management Company, to continue to leverage the resources from PGIM and to leverage its cooperation with other asset management companies in foreign countries and continue to expand the product offering for E.SUN. Okay. For the next question, we will repeat the guidance on NIM. I will ask Sarah this.
Our NIM is expected to increase by 2 basis points to 3 basis points at the end of this year, mainly due to the continued control funding cost as we will keep plugging the high spread, both in loans and securities.
Thank you, Sarah. Okay, investors. Now it seems we have answered all the questions for us today. We are going to call it a day. Thank you for your participation in the second quarter result of E.SUN, and we hope to meet you in the next quarterly earning conference. Thank you. Bye-bye.