Taishin Financial Holding Co (台新金控) yesterday said it has confidence in the Supreme Court’s ruling on a management rights dispute regarding state-run Chang Hwa Bank (CHB, 彰化銀行).
“We do not know exactly when the verdict will be made, but we expect it this year, as it usually takes a year for the Supreme Court to pronounce a judgement and it has been more than one year since the case reached the court,” Taishin Financial president Welch Lin (林維俊) told an investors’ conference in Taipei.
“I personally believe that the court will do justice by us, as we have a written agreement that guarantees us management rights over CHB. So, I think a scenario in which we lose this case is highly unlikely,” Lin added.
The conglomerate has been contesting the Ministry of Finance’s right to manage CHB since 2014, when it lost a majority on the CHB board to the ministry, as the ministry had in 2005 agreed that Taishin should keep the rights.
The ministry has said that the agreement was null and void after 2005, but Lin rejected the ministry’s claim, showing a copy of the agreement to conference attendees yesterday.
If the firm wins at the Supreme Court, it is willing to have a discussion with the ministry about CHB managing rights, Lin said.
If the ministry would let Taishin Financial regain control of CHB, the conglomerate would raise funds to merge with CHB, Lin said.
If the ministry aims to keep Taishin Financial from controlling CHB, then the company would exit the picture if it could recoup the NT$36.57 billion (US$1.18 billion) that it spent buying a 22.5 percent stake in CHB, Lin said.
Having the money returned would help Taishin Financial improve its financial picture, he added.
“We will cooperate with the ministry either way, but we cannot remain stuck any longer,” he added.
In response, the ministry yesterday said it would wait for the court’s ruling before making any decisions.
Last year, Taishin Financial reported net income of NT$12.93 billion, down 1 percent year-on-year, as increases in interest income, fee income and investment returns were offset by losses in loans to a Chinese company.
However, the company said it remains upbeat regarding profit growth for this year, as its lending and credit card businesses are showing steady growth.
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