Bank merger plan in the works: officials

The government is likely to release a merger proposal for the Bank of Taiwan (台灣銀行) and the Land Bank of Taiwan (土地銀行) within two months, and has vowed to make the merged entity one of the world's 100 biggest banks, officials said yesterday.

"We plan to put forth a report on the proposed merger deal and share sale to the public and foreign investors," Council for Economic Planning and Development Chairman Hu Sheng-cheng (胡勝正) told reporters yesterday.

Hu's remarks came after the Premier Frank Hsieh (謝長廷) restated a plan to merge the two state banks in a briefing on the second-stage financial reform.

The wholly state-owned Bank of Taiwan is slated to take over smaller rival, 100-percent state-controlled Central Trust of China (中央信託局), in June next year. The additional acquisition of the Land Bank is expected to boost the assets of Taiwan's biggest lender to above NT$4.6 trillion (US$140 billion), making it the 80th biggest bank around the globe, the government said.

The planned share sale to the public and to foreign investors after the proposed merger could happen within the next two years, which would help relieve the public's concerns that only private financial groups will benefit, Hsieh said.

The share auction will be bigger than that of Chunghwa Telecom Co (中華電信), Hsieh said. The telecom operator auctioned off 3 percent stake, worth NT$18 billion, in August last year as part of a privatization plan.