The government plans to expedite the merger of three state-owned banks to create a financial holding company, Premier Chang Chun-hsiung (張俊雄) said yesterday.
During the Cabinet's regular meeting yesterday morning, Chang said the Ministry of Finance would draft the plan to establish Taiwan Financial Holding Co (
"We expect this new company will become the leading financial holding company in the country and help enhance the competitiveness of the nation's banking sector," Chang said.
Taiwan Financial Holding will be formed as a result of the merger of Bank of Taiwan (
The resulting holding company is expected to garner a local market share of at least 10 percent, Chang said. It will rank as the 18th-largest bank in Asia, he added.
The plan to form a new state-owned financial holding company is part of the government's effort to consolidate the sector to compete with foreign banks at home and abroad.
Deputy Minister of Finance Liu Teng-cheng (
As of the end of March, Cathay Financial Holding's total assets were NT$3.53 trillion (US$107.03 billion).
The new holding company will be formed in three stages with the process, including the integration of the three banking units, expected to take two to three years, Liu said.
Taiwan Financial Holding will also comprise a securities company and a life insurance company, he added.
Liu did not say who would chair the new company. Sources at the ministry, however, suggested that Bank of Taiwan chairman Tsai Jer-shyong (
The three banks which will comprise the new holding company aren't publicly traded and Liu said the ministry has no plans to list Taiwan Financial Holding on the local bourse.
Bank of Taiwan is the largest local bank with 179 branches, enjoying strong financial support from the government. Land Bank is also a policy lender with a network of 156 branches, the financial regulator's data shows.
Last month, Bank of Taiwan acquired another state-run firm, Central Trust of China (中央信託局). That deal is expected to have a limited impact on its financial profile, Fitch Ratings said on Aug. 8.
"The establishment of the state-run financial holding company will not affect the nation's banking industry in the short-term," Susan Chu (
In creating the new holding company, the government said it would use Mega Financial Holding Co (
However, Chu said Mega Financial's performance after the merger with state-controlled Chiao Tung Bank (交通銀行) and International Commercial Bank of China (中國國際商銀) in August last year had not been impressive.
The merger of state-owned banks usually meets with strong opposition from labor unions, Chu said, adding this meant a reduction in personnel was not likely.
Such integrations created firms boasting size, but not necessarily synergy or efficiency, she said.
Asked about the new financial holding company's potential synergy, the Ministry of Finance said that the Bank of Taiwan is strong in corporate banking, international finance and foreign currency exchange, while the Land Bank focuses on real estate financing and the Export-Import Bank specializes in trade financing.
"The three complement each other," it said on its Web site.
NEXT GENERATION: The four plants in the Central Taiwan Science Park, designated Fab 25, would consist of four 1.4-nanometer wafer manufacturing plants, TSMC said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) plans to begin construction of four new plants later this year, with the aim to officially launch production of 2-nanometer semiconductor wafers by late 2028, Central Taiwan Science Park Bureau director-general Hsu Maw-shin (許茂新) said. Hsu made the announcement at an event on Friday evening celebrating the Central Taiwan Science Park’s 22nd anniversary. The second phase of the park’s expansion would commence with the initial construction of water detention ponds and other structures aimed at soil and water conservation, Hsu said. TSMC has officially leased the land, with the Central Taiwan Science Park having handed over the
AUKUS: The Australian Ambassador to the US said his country is working with the Pentagon and he is confident that submarine issues will be resolved Australian Ambassador to the US Kevin Rudd on Friday said that if Taiwan were to fall to China’s occupation, it would unleash China’s military capacities and capabilities more broadly. He also said his country is working with the Pentagon on the US Department of Defense’s review of the AUKUS submarine project and is confident that all issues raised will be resolved. Rudd, who served as Australian prime minister from 2007 to 2010 and for three months in 2013, made the remarks at the Aspen Security Forum in Colorado and stressed the longstanding US-Australia alliance and his close relationship with the US Undersecretary
‘WORLD WAR III’: Republican Representative Marjorie Taylor Greene said the aid would inflame tensions, but her amendment was rejected 421 votes against six The US House of Representatives on Friday passed the Department of Defense Appropriations Act for fiscal 2026, which includes US$500 million for Taiwan. The bill, which totals US$831.5 billion in discretionary spending, passed in a 221-209 vote. According to the bill, the funds for Taiwan would be administered by the US Defense Security Cooperation Agency and would remain available through Sept. 30, 2027, for the Taiwan Security Cooperation Initiative. The legislation authorizes the US Secretary of Defense, with the agreement of the US Secretary of State, to use the funds to assist Taiwan in procuring defense articles and services, and military training. Republican Representative
TAIWAN IS TAIWAN: US Representative Tom Tiffany said the amendment was not controversial, as ‘Taiwan is not — nor has it ever been — part of Communist China’ The US House of Representatives on Friday passed an amendment banning the US Department of Defense from creating, buying or displaying any map that shows Taiwan as part of the People’s Republic of China (PRC). The “Honest Maps” amendment was approved in a voice vote on Friday as part of the Department of Defense Appropriations Act for the 2026 fiscal year. The amendment prohibits using any funds from the act to create, buy or display maps that show Taiwan, Kinmen, Matsu, Penghu, Wuciou (烏坵), Green Island (綠島) or Orchid Island (Lanyu, 蘭嶼) as part of the PRC. The act includes US$831.5 billion in
RSS