Morgan Stanley, the sixth-largest US bank, won approval from the US Federal Reserve to increase its stake in Chinatrust Financial Holding Co (中信金控) to 9.9 percent and become the largest shareholder in the Taipei-based company.
Morgan Stanley will be allowed to purchase an additional 5.1 percent of voting shares through several asset management units, the Fed said in a statement on Friday. Morgan Stanley agreed to be a passive investor in the bank and has three months to complete the share purchase, the Fed’s statement said.
Chinatrust Financial owns Taiwan’s biggest credit-card issuer, Chinatrust Commercial Bank (中國信託商銀). Its chairman, Jeffrey Koo (辜濂松), is the biggest shareholder with 7.28 percent, Bloomberg data showed.
Chinatrust Financial and Morgan Stanley were in talks in August about possible cooperation in consumer and institutional banking, and issuing credit cards, Chinatrust financial chief investment officer Daniel Wu (吳一揆) said at the time.
Morgan Stanley’s share purchase would indirectly increase its investment in Chinatrust Bank of Torrance, California. Morgan Stanley spokesman Mark Lake declined to comment.
Morgan Stanley would purchase the shares through subsidiaries including Morgan Stanley Private Equity Asia Inc and MS Holdings Inc, the statement said.
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