Despite the government’s plans to start building three new high-speed railway stations early next year, Bank of Taiwan (臺灣銀行) chairwoman Susan Chang (張秀蓮) said yesterday that banks would lend no more than NT$382 billion (NT$11.7 billion) to Taiwan High Speed Rail Corp (THSRC, 台灣高鐵).
Chang, who is leading talks on a refinancing plan on behalf of lenders, said NT$308.3 billion of the loan would be guaranteed by the government.
While the debt-ridden company has put up its tracks, trains, stations and other equipment as collateral, Chang said the lenders wanted THSRC’s founding shareholders to jointly guarantee the remaining NT$73.7 billion.
The five founding shareholders have washed their hands of THSRC debts after previous investments bore no fruit.
Chang said she hoped to settle the refinancing plan before THSRC’s current debt payments become due in November.
On Monday, Minister of Transportation and Communications Mao Chi-kuo (毛治國) said the construction of stations in Miaoli, Changhua and Yunlin counties would begin in January and be completed by June 2015. This reflects a policy turnaround after THSRC chairman Ou Chin-der (歐晉德) said last week that work on the three stations would have to be postponed to ease the company’s financial burdens.
Chang added that the new loan would be offered at a reduced interest rate, but that the cut would not exceed 1 percentage point.
Meanwhile, two analysts yesterday urged the government to compel THSRC’s shareholders to pay the company’s debts rather than keep pumping money into what they called a “bottomless money pit.”
Jack Lee (李允傑), a member of the Taiwan Competitiveness Forum, a local think tank, said the government should push a capital reduction plan for THSRC shareholders to pay off current debts to improve the company’s financial profile.
Hsieh Ming-hui (謝明輝), deputy secretary-general of the forum, suggested that the government make the shareholders pay for the construction of the three new stations.