Sat, Jan 03, 2009 - Page 12 News List

Banks mulling insurance acquisitions

By Crystal Hsu  /  STAFF REPORTER

Unfazed by the financial crisis plaguing the world, two state-run lenders are mulling acquiring life insurance companies to ease the insurers’ cash strain and expand their own business map.

Taiwan Financial Holding Co (台灣金控) and Land Bank of Taiwan (土地銀行) have both expressed interest in buying stakes of life insurance companies partly in response to the government’s policy to support the financial sector, the Chinese-language Economic Daily News reported yesterday.

Taiwan Financial is assessing the feasibility of acquiring Nan Shan Life Insurance Co (南山人壽), a local subsidiary of financially troubled American International Group Inc (AIG), the daily said, without citing sources.

Despite a recent injection of foreign capital, Nan Shan remains inclined to sell 49 percent of its shares and has approached Taiwan Financial officials on a proposed deal, it said.

Taiwan Financial reportedly is receptive to the acquisition, but has to first settle the issue of whether Nan Shan employees would qualify as civil servants when they become Taiwan Financial staff members.

Meanwhile, Land Bank of Taiwan is seeking strategic partnerships with life insurance companies through a stock trade to augment its market share, the daily said. The bank is considering trading up to 30 percent of its shareholding, allowing the government to retain control of the lender.

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