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Yuanta increases stake in Fuhwa Financial to 28%

Yuanta Group (元大集團) increased its stake in Fuhwa Financial Holdings Co (復華金控) to 28 percent, making it the largest shareholder of the financial group, Minister of Finance Lin Chuan (林全) said during a press briefing in Taipei yesterday.

Yuanta, whose flagship Yuanta Core Pacific Securities Co (元大京華證券) is the nation's largest securities brokerage, bought the stake from the market, according to Yuanta.

Lin and Yuanta didn't say when the company started buying the shares.

"It makes perfect sense for the biggest shareholder, with more than a 20 percent stake in Fuhwa, to control the company," Lin told reporters.

Fuhwa Financial is the 12th biggest of Taiwan's 14 financial holding companies.

It offers Yuanta a license that can bring a range of financial businesses under the same brand.

Fuhwa Financial shareholders will elect new board members at a June 29 meeting.

The ministry has also mediated an agreement between the government, Yuanta and the Chinese Nationalist Party (KMT), which controls Fuhwa, according to a Ministry of Finance statement.

Under the agreement, Yuanta will control four of the nine board seats, up from none previously, Lin said.

An investment business of the KMT, which used to hold five seats on the Fuhwa board, agreed to seek three seats for its 23 percent stake.

The government-connected directors will hold two seats with a 14 percent stake, down from three seats, Lin said.
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