Print

Mail

wiki links

Economic panel wants nation to be regional hub

"We want the bill to be approved, but we do not want the government to waste [money]."

Norman Yin, a PFP legislator

President Chen Shui-bian's (陳水扁) economic advisory panel is scheduled to present an economic proposal to the president today, suggesting the government transform the nation into a hub of asset management for the Asia-Pacific region.

Vincent Siew (蕭萬長), convener of the panel, said asset management companies should be allowed more flexibility to handle the problem of debt-ridden banks.

To achieve that goal, Siew said the panel will suggest the government authorize the Financial Restructuring Fund Committee to provide guarantees to all depositors and creditors of problematic banking institutions handled by the fund.

A bill revising of the financial restructuring fund, a mechanism set up in 2001 and modeled after the US Resolution Trust Corporation, still waits for legislative approval. The Legislative Yuan will begin a new session at the end of next week.

The government reiterated yesterday that it will seek to raise its financial restructuring fund to NT$680 billion -- well above the opposition parties' cap of NT$320 billion.

Officials said the government hopes to get legislative approval for the change by October.

"The Cabinet hopes the statute revision of the fund will win legislative approval soon, but there are some other bills that need to be addressed ... we expect the bill to be passed by October," an aide to Cabinet spokesman Lin Chia-lung (林佳龍) quoted Lin as saying.

Vice Minister of Finance Yang Tze-kaing (楊子江) said his ministry is still hoping for approval from legislators to raise the fund to NT$680 billion from the current NT$140 billion in order to facilitate financial reforms.

The fund was aimed to help bail out troubled financial institutions. The financial sector would suffer if there was no such mechanism, Yang said.

"The government needs tools and liquidity in order to proceed with the planned financial reforms," he said, adding that "the more money we have the stronger the effects."

Lawmakers agree the fund is of vital importance, but they have yet to reach consensus on its allowable size.

PFP Legislator Norman Yin (殷乃平) said his party and the KMT favor passage of the revision as long as the Cabinet acknowledges the possible burden on the government and complies with a suitable fund size.

"We want the bill to be approved, but we do not want the government to waste [money]," Yin said.

Yin said the PFP's stance is for the fund cap of NT$320 billion and the Cabinet can seek a special budget if it needs more.

It is still uncertain if the fund bill can be included in next month's agenda of the legislature, Yin said.

Taiwan's 52 banks wrote off a total of NT$410.8 billion in non-performing loans (NPL) last year, cutting the banking sector's average NPL ratio to 6.12 percent at the end of December from 7.12 percent at the end of September.
This story has been viewed 2031 times.