Print

Mail

wiki links

CDIC comes out ahead on Asia Trust liquidation

The government yesterday recovered a total of NT$3.737 billion (US$115.2 million) in cash from its liquidation of Asia Trust and Investment Corp’s (亞洲信託) impaired assets and Taipei headquarters, one day after it decided to pay Standard Chartered Bank (Taiwan) Ltd (渣打銀行) NT$3.348 billion to take over the debt-ridden Asia Trust.

“The takeover, in the end, didn’t cost the government a penny to solve,” Howard Wang (王南華), president of the Central Deposit Insurance Corp (CDIC, 中央存保), said yesterday over the phone.

The deposit insurer yesterday sold Asia Trust’s impaired assets to Revival Asset Management Corp (力興資產), a subsidiary of Taiwan Asset Management Corp (台灣金聯資產公司), for NT$707 million.

It also liquidated the trust company’s Taipei headquarters, located on the intersection of Nanjing E Road and Songjiang Road, bringing in another NT$3.03 billion from its new buyer, Taiwan Life Insurance Co (台灣人壽), Wang said.

The CDIC yesterday completed the sale of the Asia Trust building through price negotiations with Taiwan Life, after the government agency failed to sell the property following three rounds of public bidding on Tuesday.

ASIAWORLD

Even so, it failed yesterday to liquidate the Asia Trust-owned first floor of the Asiaworld Department Store (大亞百貨), across from the Taipei Railway Station after no bidders offered to pay higher than the government’s floor price.

Wang said that the CDIC believes the property is a great location worth at least NT$1 billion and refused to lower its floor price yesterday.

The government took over Asia Trust on Jan. 31, after the small local lender had been unsuccessful for many years in raising fresh funds to improve its finances, resulting in a negative net worth of NT$262 million at the end of last year.

Through the acquisition of some of Asia Trust’s assets and liabilities on Tuesday, Standard Chartered Bank (Taiwan) will add seven new branches to its current network of 88 branches, which the UK bank’s Asian chief executive Jaspal Bindra said would enable the company to strengthen its network in the greater Taipei area.

LEVERAGE

Taking over the branches would also allow Standard Chartered Bank (Taiwan) to gain further leverage from its acquisition of Hsinchu International Bank (新竹國際商銀) in 2006, Bindra said in a statement released on Tuesday night.

Taiwan Ratings Corp (中華信評) yesterday maintained its ratings on Standard Chartered Bank (Taiwan), saying that the latest acquisition is not expected to significantly affect the bank’s standing despite Asia Trust’s poor credit profile.

Taiwan Ratings affirmed its “twAA+” long-term and “twA-1+” short-term credit ratings on Standard Chartered Bank (Taiwan), with a “stable” outlook, the ratings agency said in a press release.
This story has been viewed 942 times.