Liu hangs on to chairman post

Business tycoon Liu Tai-ying (劉泰英), chairman of China Development Financial Holding Corp (中華開發金控), resisted government pressure yesterday to step down voluntarily, clinging tightly to his throne at the nation's fourth largest financial services institution.

"[Six] managing directors at the company's board are authorized to hold another emergency board meeting tomorrow to discuss whether Liu should resign before reaching a final decision," China Development spokeswoman Grace Fang (方鳳山) said four hours after the company's 21-member board meeting yesterday afternoon.

Fang said that Liu did not say in the meeting whether he is inclined to stay or quit, but did apologize for the inconvenience he has caused the company's management following his indictment.

She said that a detailed report would be prepared and submitted to the Ministry of Finance as requested.

Tomorrow is the final deadline that the ministry imposed on China Development to decide on Liu's fate. But the tug of war between Liu and the ministry may not come to an end tomorrow because four out of six managing directors may still side with Liu.

Three of the four include Liu's hand-picked acting chairperson and temporary president in his absence ? Diana Chen (陳敏薰), Lin Chun (林軍), the president of China Venture Management Inc (開發科技顧問), a wholly owned China Development subsidiary and Chen Chih-chuan (陳志全), who sits on the board representing another shareholder, Ruentex Corp Chairman Yin Yen-liang (尹衍樑). Liu himself also holds one seat and presumably has one vote.

The remaining two managing directors, who are expected to vote for Liu's ouster are Benny Hu (胡定吾), chairman of China Development Industrial Asset Management Corp and government-appointed Lee Sheng-yann (李勝彥), who is president of the Bank of Taiwan.

Liu's attempt to stall his resignation yesterday came as no surprise in political and business circles. DPP Legislator Lin Chung-cheng (林忠正) said, "Since Liu pleaded not guilty in his financial scandal, it's unlikely he will voluntarily step down to further disadvantage his odds in court."

Lin urged the ministry not to act as a "toothless tiger" and instead move swiftly to dismiss Liu's chairmanship at China Development if he is not disqualified by the board.

Bureau of Monetary Affairs Director General Gary Tseng (曾國烈) told a press conference late last night that the board's failure to discuss Liu's qualifications was "very inappropriate." He also criticized Liu's attendance at yesterday's board meeting because of concerns about Liu's "conflict of interests."

The government's failure to directly ask Liu to step down was intended to give the banking sector the chance to sort the problem out itself.

But one banking sector official said the ministry is standing on shaky ground.

"Only a court conviction, not an indictment, can legally disqualify any bankers, including Liu," Kuo Yu-chyi (郭玉麒), secretary-general of the Bankers Association of ROC (銀行公會), said yesterday.

Kuo refused to elaborate, but added that any negative comments against Liu at the moment was like "rubbing salt into his wounds."