Asia Trust and Investment Corp (亞洲信託), one of the four institutions still blacklisted by the nation's financial regulator, plans to complete a restructuring scheme through a share sale to foreign investors to prevent being taken over by the government, the company said yesterday.
"We plan to start the capital restructuring in March, beginning with capital reduction to cut NT$2.07 billion [US$63 million] of current capitalization amounting to NT$4.48 billion [to subsidize the loss]," Asia Trust spokesman Lee Cheng-chung (李政忠) said.
The company could then raise US$2 billion in fresh funds from three or four interested Japanese investors, including a major bank, via a private placement and form a new management team by the end of the second quarter, Lee said.
After completing the capital restructuring, Asia Trust plans to apply for a license to transform itself into a commercial bank and may initiate its second-stage capital expansion by raising another US$2 billion from European investors who could also help the bank explore business opportunities overseas, he added.
"The plan would eventually make Asia Trust 100 percent funded by foreign financial investors," Lee said.
The company's other alternative is to merge with other banks, although the decisive factor would be which option enabled the fastest access to funds, he said.
The nation's financial regulator used a government restructuring fund to take over another three problematic banks within a three-week span last month. The intensive takeover has sparked market concern that the fund of more than NT$50 billion might not be sufficient to handle the remaining blacklisted lenders, which include Asia Trust and Chinfon Bank (
"We are well aware of Asia Trust's self-help plans, and capital restructuring is just one of them," said Jong Huey-jen (鍾慧貞), deputy director-general of the Financial Supervisory Commission's Banking Bureau.
Jong said that the regulator did not care what form banks' bailout approaches took, as long as they could help inject fresh capital in time.
Last month, Taiwan Ratings Corp (中華信評) assigned "twBB+" long-term and "twB" short-term counterparty credit ratings to Asia Trust with a negative outlook on restricted business scope, weak profitability, poor asset quality and poor capitalization.
The outlook may be revised to stable if the company received a significant capital injection, said Taiwan Ratings, a local arm of Standard & Poor's Ratings Services.
The ratings agency yesterday affirmed its "twBBB-" long-term and "twA-3" short-term counterparty credit ratings on Chinfon Bank with a stable outlook.
The stable outlook reflects expectations that the bank's credit profile will remain stable over the medium term given its efforts to tighten risk controls.
The outlook may be revised to positive if Chinfon received a sizeable capital injection and implemented an effective strategy to strengthen its competitiveness and/or profitability, it added.
END TO SPECULATION: The hotel’s management contract has been extended, despite reports that it wanted to end its alliance with Hyatt Hotels over a deal with Riant Capital Singapore-based Hong Leong Hotel Development Ltd (豐隆大飯店股份) yesterday said it has extended a management contract to ensure the continued presence of the Grand Hyatt brand in Taipei, ending rumors that the two sides were parting ways. “We are pleased Hyatt is able to come to terms on the extension of the management contract of Grand Hyatt Taipei,” said Kwek Leng Beng (郭令明), executive chairman of City Developments Ltd (城市發展) and Millennium & Copthorne Hotels Ltd (千禧國敦酒店). Hong Leong Hotel Development is a subsidiary of Millennium, and both fall under the Hong Leong Group (豐隆集團). The Grand Hyatt Taipei (台北君悅大飯店), owned and built by
’WHITE BOX’: The open platform would give local firms access to Cisco’s cloud-based mobile network to develop 5G telecom equipment and tap into the global market The Ministry of Economic Affairs (MOEA) yesterday introduced a new 5G “open lab” in collaboration with US-based information technology and networking giant Cisco Systems Inc to address the rapidly growing “white box” 5G networking equipment market. The open lab will be a platform where Taiwanese manufacturers can access Cisco’s cloud-based mobile network to develop their own 5G telecom equipment, such as small-cell base stations, network switches, modems and Internet of things (IoT) devices, a ministry statement said. The open platform would allow Taiwanese manufacturers to tap into the lucrative 5G telecom equipment market, which was previously monopolized by Nokia Oyj, Ericsson AB
Nintendo Co is raising its target for Switch production to about 25 million units this fiscal year, people familiar with the matter said, as the ongoing COVID-19 pandemic keeps lifting demand and component shortages ease. The Kyoto, Japan-based company, which in April hiked orders to 22 million units by March next year, is asking partners to tack on another few million units, said the people, who did not want to be identified discussing internal goals. Assembly partners plan to work at maximum capacity through December. The new production target suggests that Nintendo is likely to outperform its Switch sales forecast of 19 million
‘BIG LOSS’: This year might see the last generation of Huawei’s Kirin chips, as their production would stop next month because they are made using US technology Chinese tech giant Huawei Technologies Co (華為) is running out of processor chips to make smartphones due to US sanctions and would be forced to stop production of its own most advanced chips, a company executive has said, in a sign of growing damage to Huawei’s business from US pressure. Huawei, one of the biggest producers of smartphones and network equipment, is at the center of US-Chinese tension over technology and security. Washington last year cut off Huawei’s access to US components and technology, and those penalties were tightened in May, when the White House barred vendors worldwide from using US