Thu, Dec 23, 2010 - Page 12 News List

First Commercial, Cathay United open Shanghai branches

By Kevin Chen  /  Staff reporter

Cathay United Bank (國泰世華銀行) and First Commercial Bank (第一銀行) are scheduled to start operations at their Chinese branches in Shanghai today, making the two lenders the first local banks to serve Taiwanese businesspeople living and working there.

The two were among five Taiwanese banks to win China’s approval last week to start operating Chinese branches.

Cathay United, owned by Cathay Financial Holding Co (國泰金控), said in an e-mailed statement yesterday that the Shanghai branch, headed by Liu Chun-hao (劉俊豪), would conduct business using foreign currencies during the preliminary stage of its operations.

Under the Economic Cooperation Framework Agreement (ECFA) signed between Taiwan and China in late June, a Taiwanese lender can begin yuan-based business with Taiwanese customers in China after its Chinese branch is profitable and has been established for at least a year.

The branch can start providing banking services in yuan to customers other than China-based Taiwanese businesspeople after two years of operations if it reports a profit in the second year.

A Cathay United public relations specialist said by telephone yesterday that yuan business accounts for about 98 percent of banking services in China, with foreign currency services making up the remainder.

First Commercial, a banking unit of First Financial Holding Co (第一金控), said in a statement on Monday that it aimed to start offering yuan-based services for Taiwanese businesspeople after making a profit in its first year of operations.

In the longer term, the bank said its Shanghai branch, led by Lu Hsin-chih (呂信志), would actively participate in China’s economic development, the statement said.

The other three Taiwanese banks that are expected to begin operating Chinese branches soon are Land Bank of Taiwan’s (土地銀行) Shanghai branch, Chang Hwa Commercial Bank’s (彰化銀行) Kunshan branch and Taiwan Cooperative Bank’s (合庫銀行) Suzhou branch.

Shares of First Financial fell 0.6 percent to NT$24.75 and Cathay Financial edged down 0.21 percent to NT$47.1, while Taiwan Cooperate Bank was up 0.22 percent to NT$23.25. Land Bank and Chang Hwa Commercial Bank are not listed on the local bourse.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top