The Financial Supervisory Commission (FSC) plans to meet with top executives from domestic financial institutions to gain a better understanding of their finances and cross-strait expansion plans, FSC Vice Chairperson Lee Jih-chu (李紀珠) confirmed yesterday.
The meetings, slated to take place today and next Tuesday, are unlikely to spur drastic deregulation, such as axing the 5 percent cap on Chinese banks’ stakes in their local peers, Lee said.
“The commission has made clear its stance on the issue and it will not make sudden changes,” Lee said by telephone, citing FSC Chairman Chen Yuh-chang (陳裕璋).
The 5 percent ceiling, which took effect on Jan. 2, should be given more time to determine if it needs review or revision, Chen told a news conference last week.
No Chinese banks have filed applications to own stock in Taiwanese financial institutions to date, Lee said.
Local Chinese-language media have run reports alleging the commission plans to raise the limit to 20 percent to better entice Chinese lenders.
Jean Chiu (邱淑貞), deputy director-general of the FSC’s banking bureau, said the 5 percent ceiling is so that local lenders can introduce strategic partners.
Collectively, Chinese banks may take up to a 10 percent stake in a Taiwanese bank.
While the commission is open to change, it is premature to conclude that the new opening should be scrapped, FSC Secretary-General Lin Tung-liang (林棟樑) said.
The commission, however, will contemplate measures to help local financial institutions better compete against their foreign peers, Lin said.
Premier Sean Chen (陳冲) suggested a day earlier that Taiwan should find its niche market in the region and take advantage of the yuan’s increasing weight on the global stage.
The large number of Taiwanese firms in China spells ample business potential for local lenders, Lee said.
The commission is mulling easing rules regarding yuan financing and it plans to unveil the details once they are in place, Lee said.