The government should retain a majority stake in one of its financial services companies to help carry out policies, Vice Premier Wu Rong-i (
"It's necessary to have one state-owned financial holding company," Wu said in a forum on privatization in Taipei. "It's easier for the government to carry out its policies."
The government has majority stakes in none of the nation's 14 financial holding companies. The government has said it wants to halve the number of financial companies to help them become more efficient.
The government needs banks' involvement in measures such as providing NT$200 billion (US$6.3 billion) of loans to small and medium-sized companies and NT$300 billion in subsidized mortgages, aimed at helping stimulate the economy.
In 2002, the government said it would sell stakes in the Bank of Taiwan (台灣銀行), the Land Bank of Taiwan (土地銀行) and the Central Trust of China (中央信託局) by December next year, after twice failing to merge the three state-owned lenders.
The government is selling stocks to help plug a budget deficit projected to reach a record NT$334.7 billion this year.
Privatization, or reducing state ownership to less than 50 percent, frees companies from having lawmakers control their budgets and from obligations to meet civil-servant benefits for employees.
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