First Commercial Bank (
First Commercial will open its first office in Shanghai, said bank Chairman Jerome Chen (陳建隆), who is traveling with Minister of Finance Yen Ching-chang (顏慶章) in London to promote opportunities in the country to overseas investors.
"Having a representative office in Shanghai will give us first-hand information on Taiwan-based companies' investments in China," Chen said. "That will help ensure our credit quality at home."
Thousands of Taiwan companies have moved factories across the Taiwan Strait to China, where production costs are lower.
The exodus is partly responsible for rising unemployment and slowing economic growth in Taiwan. Taiwan's unemployment rose to a record 4.4 percent in May.
Still, the bank has no immediate plan to apply for full branch status in China.
"We are not seeking to open a full-blown branch to extend credits in China, because that will only weaken Taiwan's economy," Chen said.
Taiwan cabinet said earlier this month it will start to allow local banks to open representative offices in China to encourage Taiwan businesses to remit their investment proceeds back home.
First Commercial chairman Chen, 53, was chairman of Bank of Kaohsiung (高雄銀行) before being named to take over at the bank in June of last year from Chen An-chyr, an appointee of the former KMT-led government. The government owns a 24 percent controlling stake in First Commercial, and one of its board representatives traditionally serves as chairman.
Chen was the first in a string of management reshuffles at Taiwan's major state-controlled companies, as President Chen Shui-bian (陳水扁) moves to install allies in positions that for five decades were controlled by the KMT, who lost power when the DPP swept to victory last year.
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