CTBC Financial Holding Co (中信金) yesterday said that Thailand’s LH Financial Group PLC has agreed to extend the time frame for a stake acquisition deal until the end of the first quarter next year.
CTBC Financial in March announced plans to acquire a 35.6 percent stake in the Thai company for NT$15.4 billion (US$482 million), but the Financial Supervisory Commission has yet to approve the deal.
LH Financial has agreed to extend the deadline from Dec. 31 to March 31 to give the company more time to gain regulatory approval in Taiwan, CTBC Financial president Daniel Wu (吳一揆) told an investors’ conference.
The commission has included previous infractions and compliance with mandated improvements in its approval process, Wu said.
“While the commission has said that further improvements are required, it did not specify specific shortcomings,” Wu said.
This year, the company has been rocked by a number of high-profile cases, including allegations that its banking and securities brokerage subsidiaries failed to perform due diligence in a collapsed tender offer for XPEC Entertainment Inc (樂陞科技), which left investors with immense losses.
The company has also scuttled plans to fully acquire Royal Bank of Scotland Group PLC’s Malaysian unit for NT$6.1 billion in August, after slow progress in gaining regulatory approval.
In China, CTBC Financial canceled plans with state-owned Chinese financial conglomerate CITIC Group (中國中信集團) to invest in each other’s company, dashing its hope to establish a foothold in China’s banking market, as well as plans to form a joint venture with a Chinese partner in the China (Fujian) Pilot Free-Trade Zone.
“The company will focus on organic growth from current operations, as opposed to aggressively pursuing mergers and acquisitions,” Wu said.
The company reported that net income in the first nine months dipped 6.5 percent annually to NT$23.33 billion. Earnings per share were NT$1.29 percent.
During the period, net income contribution from CTBC Bank Co ( 中國信託銀行), the company’s biggest subsidiary, dropped 18.3 percent to NT$17.6 billion.
The company added that it has booked yuan-linked target redemption forward-related losses of NT$1.3 billion for last quarter, and that Japanese regulators have asked for additional provisions allocation for its subsidiary Tokyo Star Bank, which handles 51.4 percent of its NT$999 billion foreign-currency loan portfolio.
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