Financial analysts appeared unimpressed with President Chen Shui-bian's (
"The second-stage financial reform is intrinsically a failure," Chu Yu-chun (
The government did not significantly reduce the number of state lenders last year or carry out a plan to halve the number of local financial holdings firms by the end of last year, Chu said.
Chen said in a speech at a forum yesterday that, despite the need for review and better implementation, the second financial reform was correct in its aims.
Financial stocks soared yesterday, with the financial sub-index outpacing all other indices with a rise of 1.46 percent, beating the 0.4 percent increase in the benchmark index.
Gainers were mainly insurance players, led by Shin Kong Financial Holding Co (
The brisk performance was not driven by Chen's comments, but rather by the property market, said Fiona Uang (汪姵吟), an analyst with the Mega Securities Co (兆豐證券).
Reports said yesterday asset-rich Shin Kong Financial planned to issue a real estate investment trust, backed by its plan for residential buildings with apartments for lease, she said.
In October 2004, Chen began promoting second-stage financial reforms aimed at consolidating the nation's overcrowded banking sector. The scheme was aborted during the term of former premier Su Cheng-chang (
The reform had four goals: halving the number of state banks to six by the end of last year; reducing the number of financial groups to seven by the end of this year; having at least one local bank taken over by a foreign competitor; and having at least three local lenders with a market share exceeding 10 percent.
Only two targets have been met; Standard Chartered Bank has acquired Hsinchu International Bank (
"We do not expect Chen's remarks to trigger industry-wide consolidation. But this may imply the government's further move to dispose holdings in state-controlled lenders," Uang said.
"For private financial institutions, their priority is to expand in China, not to become bigger in the small domestic market," she said.
Market watchers named several state banks as potential targets for future share disposal, including Chang Hwa Bank (
‘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
’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
CORPORATE SCANDAL: Cathay Life has invested NT$13.3 billion in Bank Mayapada since 2015, but the latest loss of NT$8.8 billion has completely written off its investment Cathay Life Insurance Co (國泰人壽) yesterday said it would recognize an investment loss of NT$8.8 billion (US$298.1 million) in Indonesia’s Bank Mayapada Internasional Tbk PT due to concerns about the lender’s operations amid a corporate scandal. The company said it would revise its earnings result for June, from a net profit of NT$6.52 billion to a net loss of NT$520 million, its first monthly loss over the past 17 months. After booking an investment loss of NT$5.2 billion in Bank Mayapada earlier this year, Cathay Life has so far recognized total investment losses of NT$14 billion in the lender, executive vice president
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported that revenue last month expanded 25 percent annually, but fell 12.8 percent month-on-month to NT$105.96 billion (US$3.59 billion). In the first seven months of this year, the chipmaker’s revenue surged 33.6 percent to NT$727.26 billion, compared with NT$544.46 billion a year earlier. TSMC has said it aims to grow its revenue by more than 20 percent this year. The company has since May 15 stopped taking new orders from Huawei Technologies Co (華為), its second-biggest customer after Apple Inc, due to the US’ restrictions on exports containing US technologies. TSMC has no plans to