Temasek Holdings Pte, Singapore's state-owned investment company, plans to buy one of the top 10 banks in Taiwan, adding to stake purchases in Chinese lenders.
Eva Ho, a spokeswoman at Temasek, confirmed a report in the Commercial Times that a unit of the investment company plans to acquire a major Taiwanese bank. The report cited Francis Andrew Rozario, chief executive at Asia Financial Holdings Ltd, owned by Temasek.
Taiwan is seeking to consolidate its almost 50 lenders so they can compete with Citigroup Inc, HSBC Holdings Plc and other global banks expanding in the island. An investor would gain access to a US$700 billion banking market in which the number of millionaires swelled 6.4 percent last year to 55,400, according to a June 10 report by Merrill Lynch.
"This is quite positive for both parties as Taiwan needs such a renowned foreign investor and Temasek needs a Taiwanese bank in its expansion in the Greater China market," said Parker Wu, who helps manage the equivalent of US$3.1 billion at Shinkong Investment Trust Co (新光投信) in Taipei. "The progress still depends on the government's attitude." he said, adding that he has shares in Taiwanese financial companies.
Temasek is also interested in buying First Financial Holding Co if the government sells its stake in the latter, the Commercial Times reported. First Financial Holding Co (第一金控), the nation's fourth-largest financial-services provider, is a state-controlled company.
China Investments Temasek committed almost a third of the US$15 billion of strategic investments attracted this year by the three largest lenders in China, which is trying to strengthen domestic banks before the industry is opened to increased foreign competition at the end of next year.
The financial regulator, Kong Jaw-sheng (龔照勝), said in an interview last month that the first takeover of a bank on the island by an overseas investor will take place this year. Kong declined to name potential buyers or targets.
Temasek is seeking to buy a stake in Chang Hwa Commercial Bank (彰化銀行), 18 percent owned by the government, Chang Hwa executive vice president Hsieh Chao-nan (謝昭南) said on Aug. 1.
Hsieh declined to say how many shares Temasek wants to buy and what price it's willing to pay.
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