A proposal to merge three of the nation's top financial institutions into one mega-bank has fallen by the wayside under the new presidential administration.
The plan, which was pushed by the Ministry of Finance (
But now that the DPP has taken over from the KMT, the proposal appears dead in the water, sources at the finance ministry said.
Blocking the merger is resistance from the Bank of Taiwan's employees' union (台銀產業工會). The three-way merger could lead to lay-offs of thousands of workers.
Union officials have been adamant in opposing the merger, and met with President Chen Shui-bian (
The tie-up would have created Taiwan's largest bank with more than NT$37 trillion (US$1.23 trillion) in assets. The original plan was to have the merger completed within six months.
But since the first meeting of a merger task force on Jan. 13, no progress has been made.
Whether the merger will go forward remains uncertain, the unidentified finance ministry official said.
The task force was scheduled to report on the merger to Minister of Finance Shea Jia-dong (
Also hindering the merger's progress, according to the official, is an order from the new finance ministry suspending the implementation of any new policies -- including the bank merger.
Meanwhile, top management at both Bank of Taiwan and Central Trust of China has changed since January -- complicating matters even further.
"The difficulties in the merger case has been anticipated from the beginning," said Norman Yin (
Yin added that the union's opposition and the KMT's fall was just additional straws on the camel's back. "Therefore, if the merger was canceled, it wouldn't be a surprise," he said.
According to last year's draft of the Financial Institutions Merger Law (
Originally, the merger law was part of ex-finance minister Paul Chiu's (
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