In light of President Chen Shui-bian's (
"We believe it's about time for the Ministry of Finance to embrace changes in the execution strategy [of the privatization of Taiwan's banking sector] before it's too late," Jesse Wang (
"Our proposal is that the ministry should consider holding an auction to sell stakes in the state banks just like the auctions of 3G [third-generation] mobile phone licenses," Wang said.
Wang added that some heavyweight financial companies have urged the ministry to adopt the approach, especially after Chang Hwa Commercial Bank (彰化銀行) failed to conclude its global deposit receipt (GDR) offering earlier this month.
An auction could be a win-win scenario, as the ministry would achieve its political objectives on time, Wang said, with the ministry expected to pocket some NT$170 billion (US$5.4 million) -- equivalent to some 1.7 percent of the nation's GDP or 11.3 percent of the fiscal budget last year -- if it auctions off its stake in seven state banks, including Chang Hwa, Hwa Nan Financial Holdings Co (華南金控), and First Financial Holding Co (第一金控).
Meanwhile, the industry would become less fragmented, with the top 10 banks owning a combined market share of 76.7 percent, up from the current 61.8 percent. Investors could benefit as a better pricing environment will help ensure stronger profit sustainability, the industry watcher explained.
Despite the failure to sell Chang Hwa Bank's GDR issuance, Minister of Finance Lin Chuan (林全) said last week that they will finalize the disposal of stakes in four state-controlled banks, including its stake in Chang Hwa, it's 100 percent stake in Central Trust of China (中央信託局), and two other unnamed privatized and listed financial institutions by the year's end as scheduled.
The two banks reportedly are Farmers Bank (農民銀行), which will be acquired by Taiwan Cooperative Bank (合作金庫); and Taiwan Business Bank (台灣企銀), which will be put on sale to interested local financial institutions.
The government previously completed dumping its shares in two state financial institutions, in the sale of Taiwan Development & Trust Corp (
An auction could expedite the privatization and consolidation process in the financial sector by creating a herd effect that would attract both local and foreign investors.
"They all understand that if they miss such a chance, they will fall significantly behind in the consolidation game for a considerable period of time," he explained.
In an attempt to strengthen the competitiveness of the nation's finance industry versus its foreign rivals, the government also wants to reduce the number of financial holding firms to seven from the current 14 by the end of next year.
In light of these ambitions, BNP Paribas recommended that investors begin rebalancing their exposure in the financial sector from consumer-centric private players to the state bank segment.
The securities house meanwhile upgraded First Financial Holding Co (
Other picks include Fubon Financial Holding Co (
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six