Taishin plans expansion after deal hits a snag

By Crystal Hsu  /  Staff reporter

Wed, Nov 06, 2013 - Page 13

Taishin Financial Holding Co (台新金控) has refocused on expansions abroad after its efforts to acquire Chang Hwa Commercial Bank (彰化銀行) hit a snag, a senior executive said yesterday.

The company plans to establish branches in Singapore, Australia, Vietnam and other Southeast Asian nations to take advantage of the region’s fast-growing economy, Taishin Financial spokesman Welch Lin (林維俊) said on the sidelines of an investors’ conference.

“We expect to set up a branch in Singapore by October next year,” Lin said.

Chang Hwa Bank — in which Taishin Financial owns a 22.5 percent stake — already operates a branch in Singapore.

Taishin Financial is Chang Hwa’s largest shareholder, but has to share management decisions with the government, which is Chang Hwa’s second-largest shareholder.

Lin said Taishin Financial has put its acquisition plans for Chang Hwa on hold for the moment, but that does not mean the company has given up on the deal.

Instead, the company is seeking to expand overseas and next month its board will discuss plans to raise at least NT$5 billion (US$169.69 million) to finance those plans, Lin said.

The company is also in talks to establish a branch in Brisbane, Australia, upgrade its representative office in Vietnam to a branch and foray into another ASEAN market to serve Taiwanese companies there, Lin said.

Meanwhile, Taishin International Bank (台新銀行) is not qualified to enter China because it does not meet the requirement of having banking experience in advanced countries, Lin said. However, China has agreed to drop the requirement in the cross-strait service agreement, which remains under legislative review, he added.

He said the bank needs more details before deciding to set up a branch in the new Shanghai free-trade zone, but the bank’s capital leasing unit in Nanjing reported profits in the first three quarters and another leasing unit in Tianjin managed to break even.

In the first nine months of this year, an improving core business elevated net income to a record of NT$11.8 billion, higher than the whole of last year at NT$10.26 billion, Taishin Financial president Joseph Jao (饒世湛) said.

The figures translated into earnings per share of NT$1.49.

The company expects a modest pickup in lending to small and medium-sized enterprises for the rest of the year and flat operations in secured lending, wealth management and its underwriting businesses, Jao said.

Taishin Financial’s shares closed down 0.69 percent at NT$14.4 yesterday.