Bad debt provision increased

Finance Minister Lee Yung-san (李庸三) yesterday said the government's Financial Restructuring Fund (金融重建基金) may be raised to NT$850 billion. The ministry of Finance had previously proposed to the Cabinet to raise the fund from NT$140 billion to NT$600 billion in order to tackle the nation's bad loans of NT$2 billion, pending the premier's and legislative's approval. But after the ministry failed to auction off the debt-ridden Chung Shing Commercial Bank (中興銀行), which reported a net loss of over NT$8 billion, the ministry plans to establish an asset management company under the fund to buy off the bank's impaired assets and, therefore, requires more than NT$600 billion as formerly benchmarked. The Cabinet is expected to finalize the fund's budget by August's end and seek a legislative support at the upcoming session.