Taiwan Financial to be biggest lender

State-run Taiwan Financial Holding Co (台灣金控), which is slated to launch operations on Jan. 2, will be the 18th-largest financial service provider in Asia in terms of assets -- and the world's 89th-largest -- with NT$5.12 trillion (US$1.57 billion) in assets.

Taiwan Financial will also become the largest megabank and conglomerate in Taiwan, overtaking Cathay Financial Holding Co (國泰金控).

Speaking at a ceremony ahead of the megabank's launch yesterday, Premier Chang Chun-hsiung (張俊雄) praised the completion of the government-proposed merger of the 100 percent government-owned Bank of Taiwan (台灣銀行), the Land Bank of Taiwan (土地銀行) and the Export-Import Bank of the Republic of China (中國輸出入銀行).

Chang called the creation of Taiwan Financial a success in the face of "an impossible mission."

He said that Taiwan Financial would become the lender with the biggest market share in Taiwan -- 18 percent -- with NT$3.88 trillion in deposit savings and NT$3.24 trillion in corporate lending.

"Taiwan Financial will be an important force in the government's efforts to pursue financial market stability," Chang said.

Taiwan Financial chairman Tsai Jer-shyong (蔡哲雄) yesterday vowed to improve the megabank's international competitiveness "by boosting its capital efficiency, reducing costs and creating synergies through cross-selling" at 323 outlets under five subsidiaries -- including a planned securities company and life insurance company.

Tsai said Taiwan Financial's spectrum of talent and outlets put it in an excellent position to serve corporate clients with operations across Asia.

Tsai said that the bank sees the Chinese market as part of its global clientele base and hoped to enter Chinese markets if government restrictions are lifted.

Taiwan Financial will also seek strategic partnerships with foreign financial service providers to expand its product lines and services to cash in on the booming wealth management business.

Although he declined to reveal the lender's profit goal for next year, Tsai expressed confidence in Taiwan Financial's prospects, saying "the bank's income from first-year insurance premiums are expected to reach NT$20 billion by the year's end."

Taiwan Financial also elected 12 board members yesterday, including two representatives from the Bank of Taiwan, one from Land Bank, one from the Export-Import Bank, one independent director and seven other professionals.

The megabank has no plan to privatize in the near future, Tsai said.

"It's the government's call," he said.