But this failure would not discourage the nation's financial holding companies from taking over competitors for expansion, Yang said, as "They are always willing [to buy] and keep alert to any acquisition opportunity."
These buyers are expected to divert their attention to medium and small banks or cooperatives that are easier to acquire than state banks, she said.
The Financial Supervisory Commission yesterday said the authority would continue the reform by expediting consolidation and internalization.
"The failed bid is not a setback to the nation's financial reform efforts," commission chairman Kong Jaw-sheng (
Stating that consolidation would not impact on employment, the commission said that the number of finance-sector employees grew to 134,504 last year from 125,026 in 2003, despite a number of mergers and acquisitions last year.
Meanwhile, the nation's banks have a return on asset ratio of 0.6 percent on average, lower than their foreign rivals' 1 percent, while their return on equity ratio is around 10 percent, compared with foreign competitors' 15 percent to 20 percent, according to the commission.
The figures indicated that local financial institutions were short on differentiation and capabilities to develop new products, which was the reason that the government was promoting consolidation to help foster between one and three "national champion banks" with a better competitiveness rating, Kong said.
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