Following the legislature's passage of the Financial Supervisory Board Organization Law (
"The yet-to-be-established Cabinet-level board will merge the Central Bank of China, the Central Deposit Insurance Corp (CDIC,
A nine-member management committee, including one chairman and two vice-chairmen, will be recommended by the premier and later appointed by the president to independently manage the board in four-year terms, Lin said, adding that no more than one-third of the board's members may be from the same political party, to avoid political interference.
A clause that previously stipulated that the vice finance minister and head of the central bank would automatically serve as members of the board is no longer effective, Lin said.
The finance ministry will be streamlined, taking charge only of government coffers and taxation after the Bureau of Monetary Affairs, the Securities and Futures Commission and the Insurance Department are to be spun off from the ministry and consolidated under the financial supervisory board, he said.
Meanwhile, Lin expressed regret over the legislature's failure to approve the size of the Financial Restructuring Fund (
"The later it is passed, the more the government will have to pay for financial reforms," Lin said.
"Without the fund, the government can't even deal with the two most debt-ridden banks, Chung Shing Commercial Bank (
Lin said that the ministry will stick to its guns and insist that the bailout fund covers distressed banks' non-depository liabilities, a point of contention for the pan-blue camp.
Therefore, the opposition proposed halving the fund from a previously-agreed NT$680 billion to NT$320 billion.
"The failure to cover distressed banks' non-depository liabilities [under the fund] will further lead to financial instability and crisis, which the government can't afford to take on," Lin said, adding that the ministry has no choice but to stand its ground when the legislature reopens in September.
Lin yesterday expressed his thanks to the legislature for passing the Real Estate Securitization Statute (