The Financial Supervisory Commission (FSC) is planning to ease regulations to allow local financial institutions to invest up to 100 percent in information-technology companies, FSC Chairman William Tseng (曾銘宗) said yesterday.
Current regulations allow financial institutions — including banks, insurers and brokerage houses — to invest only up to 5 percent in a non-financial company, in line with the principle of separation of banking and commerce.
However, to keep pace with changes in global market trends, the commission plans to revise the regulations by the end of this year to allow financial institutions to invest more in the IT industry to maintain the financial industry’s competitiveness, Tseng said.
Developments in networking, mobile communication, social media, big data and the Internet of Things (IoT) have changed the financial industry, with IT playing a more vital role in financial institutions, he said.
“We cannot let information technology hold back the development of the financial industry, which could hurt the financial sector’s competitiveness,” Tseng told a media briefing.
Banking Bureau Director-General Austin Chan (詹庭禎) said the commission would pick industries that are closely related to the financial sector’s development and list them as potential targets for higher investment shareholdings of more than 5 percent up to 100 percent.
However, the commission will review each investment application on a case-by-case basis, with the targets for investment required to derive 60 percent of their profits from financial services, Chan said.
Tseng said the commission is also considering a suggestion by financial institutions to allow banks to operate cafes or other retail businesses in their branch offices.
“With online banking services becoming more mature, we hope banks can make better use of their physical bank branches to add value,” Tseng said.
In related news, the commission is scheduled to allow local banks’ offshore banking unit to set up branches in airport or port terminals in the second half of the year, allowing foreigners to open an account right after their arrival in Taiwan.
Chan said various private banks have expressed an interest in the new business, but they still need to secure a booth in the terminal before they can set up a branch.
The FSC is also scheduled to relax the margin loan position limit on June 29, allowing brokerages to control and manage margin loan position limits on an individual basis.
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