China Development wants foothold in retail banking


Sat, Dec 14, 2002 - Page 11

China Development Financial Holding Corp (中華開發金控) plans to buy a consumer bank to reinforce its brokerage and industrial bank businesses.

The company, which has been in preliminary talks with SinoPac Holdings (建華金控) and about five others, said it's seeking a bank with about 50 branches and consumer and corporate lending businesses.

"We have established a strong wholesale banking position, now we want to strengthen our retail banking," said Yang Tze-kaing (楊子江), president of China Development Industrial Bank (中華開發銀行).

"We will work toward this direction in the next one year for a more complete financial services platform," Yang said.

Lenders are trying to expand to compete more effectively in an increasingly deregulated financial industry, as the government loosens restrictions to lure foreign investors.

At present there are about 50 lenders and more than 300 community-level lending associations.

China Development directors yesterday named Yang, who joined the company in 1988, as president of the unit that runs investment banking, corporate lending and venture capital businesses.

Chairman Liu Tai-ying (劉泰英) previously held the president's position as well.

Liu, once known as the KMT's unofficial treasurer and a close friend of former president Lee Teng-hui (李登輝), was detained by Taipei prosecutors late last month over his alleged involvement in a real-estate development scandal. He was released from detention after a day of questioning.

China Development is targeting a bank that can team up with its newly acquired brokerage arm. China Development completed the acquisition of Grand Cathay Securities Corp (大華證券) last month, part of a government-driven consolidation of the financial industry.

The financial holding company's industrial bank unit expects 20 percent to 30 percent profit growth next year, Yang said, declining to give exact numbers.

China Development Financial, which gets almost all its income from the bank, this year expects to earn net income of NT$6.66 billion (US$191 million), according to a company statement to the Taiwan Stock Exchange.