Cooperative bank's IPO set for October

Taiwan Cooperative Bank (合作金庫) plans its initial share sale next month after winning preliminary approval by regulators, chairman Sean Chen (陳沖) said.

It would be the first IPO in the financial services industry since January last year.

"If everything goes smoothly, we will launch our IPO in late Octo-ber," Chen, who stepped down as chairman of the Taiwan Stock Exchange Corp on July 16, said in a telephone interview.

The government will sell 20 million shares, or 0.9 percent of its holding in the bank next month, Chen said. The government wants to reduce its 60 percent stake to 46 percent by the end the year, he said, declining to discuss how much the sale will raise.

Chen said that the listing committee of the stock exchange approved the sale, leaving the exchange's board and the government securities regulator to approve the application. No roadblocks are expected, he added.

Taiwan Cooperative has a leading position in the banking system in terms of assets, and the bank has been designated by the government to act as the main banker for the community financial institution sector. 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.

"Our profitability should improve if we become a business bank," Chen said.