Tue, Jul 27, 2004 - Page 11 News List

Business Briefs 

STAFF WRITER, WITH AGENCIES

Fund to be expanded

Susan Chang (張秀蓮), vice chairwoman of the Financial Supervisory Commission said yesterday that the government has proposed expanding the capital of the Central Deposit Insurance Corp (中央存保) to NT$200 billion to bail out failed banks.

During a speech organized by the Bank of Taiwan (台灣銀行), Chang said the commission is considering raising or extending the levy of business taxes on banks. Currently, the government finances the bank bailout fund, also known as the Financial Restructuring Fund (金融重建基金), by collecting a 2 percent business tax on banks' financial services, which the Ministry of Finance plans to scrap in 2011.

The Financial Restructuring Fund last month gained legislative approval for another one-year extention. The fund is now left with some NT$40 billion in available capital after clearing debts for 44 financial institutions.

Taishin Bank to buy rival

Taishin International Bank (台新銀行) said it agreed to pay NT$1.4 billion (US$41 million) to acquire small rival Hsinchu Tenth Credit Cooperative (新竹十信).

The acquisition will increase Taishin Bank's number of branches to 101 from 89. All 169 staff at the small lender will be kept, according to a company statement.

"The takeover will help the group increase its market share in both deposits and loans, as well as giving it a more extensive channel to sell products and services," said parent Taishin Financial Holdings Co (台新金控), which is one-third owned by foreign investors, in the statement.

As at end of last month, Hsinchu Tenth Credit Cooperative has total assets of NT$20.4 billion and a net worth of NT$1.17 billion. The small lender has outstanding deposits of NT$18.2 billion and outstanding loans of NT$10 billion, according to the statement.

Bank listing approved

Taiwan Cooperative Bank (合作金庫) may sell shares to the public for the first time by the end of the year after directors approved its listing plan, a Chinese-language newspaper said, citing chairman Sean Chen (陳沖).

The government owns 60 percent of the bank while the remaining 40 percent is owned by farmers' and fishermen's associations, private banks and credit cooperatives.

Taiwan Cooperative has about 2.2 billion shares. A stake of about 1 percent, or 20 million shares, owned by the private shareholders will be offered in the initial stock sale, the paper said.

The lender will submit its listing application this week and the share sale is expected by the end of the year at the earliest, the paper added.

Money supply growth slows

The money supply growth slowed last month as the government amid slowing demand for bank loans.

M2, the broadest measure of the nation's money supply, expanded 7.9 percent from a year earlier after growing 8.6 percent in May, the central bank said in a statement.

M1A, which tracks net currency in circulation plus checking accounts and passbook deposits, expanded 24.9 percent last month after growing 27 percent in May. The M1B money supply, which excludes time deposits and foreign-currency deposits included in M2, grew 20.2 percent in May.

Loans and investments by major financial institutions rose 5.5 percent last month after climbing 6.2 percent in May, the statement said.

NT dollar declines

The New Taiwan dollar yesterday traded lower against its US counterpart, declinging NT$0.033 to close at NT$34.098 on the Taipei foreign exchange market.

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