Legislature to pass bank bailout fund by year's end

The legislature probably will pass NT$220 billion (US$6.5 billion) in supplemental funding for the bailout of financial institutions this year, the head of the Finance Committee said.

"Since we have solved most of the disputes, chances of passage by the end of this year are high," said committee Chairman Norman Yin (殷乃平), a People First Party legislator. The sticking point remains whether the appropriation will be passed before or after Dec. 11 legislative elections, he said in a phone interview.

Yin's remark came out after negotiations over a draft amendment to the Financial Restructuring Fund bill (金融重建基金) failed to reach an agreement among lawmakers on Wednesday. Financial shares yesterday dropped 2 percent on average on the Taiwan Stock Exchange.

The legislature in its last session in June passed a one-year extension for the bailout fund. Lawmakers at that time asked the financial regulator to submit a proposal regarding how much it wants to increase the fund's available capital this session, with 20 percent of the fund should be allocated to deal with bad loans.