Sale of state-run bank declared a failure

The sale of shares in state-run Taiwan Business Bank (台灣企銀) was declared a failure yesterday because of a lack of consensus between the bank's labor union and the potential buyer, Minister of Finance Lin Chuan (林全) said at a press conference.

"The potential investor decided to give up on making a new bid, as the labor union has presented many new requirements during the negotiation process," Lin said.

Lin didn't name the potential investor, but market rumors have circulated that E.Sun Financial Holding Co (玉山金控), Taiwan's No. 10 financial holding company, was the likely buyer.

The union demanded that the buyer offer better early-retirement packages for the benefit of its members in case of layoffs. Employees ended a four-day strike on Tuesday, but negotiations continued until 8pm yesterday, he added.

Although the bidding for the government's share in the bank was aborted, Lin said the ministry will consider other methods to sell stocks, as the government remains determined to push forward planned financial reforms.

However, it is unclear whether the small lender will be merged with another bank by the end of the year as scheduled, as the ministry will have to review the failed deal before making further moves, the minister said.

The government currently owns a 41-percent stake in Taiwan Business Bank.