Tue, May 27, 2003 - Page 11 News List

Finance minister voices support for Mega chief Cheng

By Joyce Huang  /  STAFF REPORTER

Minister of Finance Lin Chuan (林全) told lawmakers yesterday that the government will support Cheng Shen-chih (鄭深池) staying on as chairman of Mega Financial Holding Co (兆豐金控).

"Cheng's performance has been satisfactory," Lin said yesterday at the legislature, in response to inquiries made by PFP Legislator Norman Yin (殷乃平).

Yin questioned Cheng's managerial ability since Mega's stock has under-performed. Mega is the nation's third-largest financial services company by market value.

Mega was formerly known as Chiao Tung Bank Financial Holding Co (交通銀行金控) before it changed its name on Jan. 16. The company's subsidiaries include Chung Hsing Bills Finance Corp (中興票券), International Securities Co (國際證券), Barits Securities Corp (倍利證券) and Chung Kuo Insurance Co (中國產險).

Mega is scheduled to hold a board meeting on June 6 to reshuffle its board and downsize it from 18 members to 15.

The legislature yesterday reached a non-binding resolution urging the ministry, which owns nearly 30 percent of the company, not to manipulate Mega's management during the board changes. There has been speculation that the ministry is wants eights seats on the board.

Cheng was accused last week of bribing shareholders with giveaways in exchange for support of his chairmanship bid.

Mega issued a written statement yesterday flatly denying the allegations and saying that it would welcome an investigation."

Lin Chuan yesterday added that the Securities and Futures Commission will look into the allegations.

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