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.
NATIONAL SECURITY THREAT: An official said that Guan Guan’s comments had gone beyond the threshold of free speech, as she advocated for the destruction of the ROC China-born media influencer Guan Guan’s (關關) residency permit has been revoked for repeatedly posting pro-China content that threatens national security, the National Immigration Agency said yesterday. Guan Guan has said many controversial things in her videos posted to Douyin (抖音), including “the red flag will soon be painted all over Taiwan” and “Taiwan is an inseparable part of China,” while expressing hope for expedited “reunification.” The agency received multiple reports alleging that Guan Guan had advocated for armed reunification last year. After investigating, the agency last month issued a notice requiring her to appear and account for her actions. Guan Guan appeared as required,
A strong cold air mass is expected to arrive tonight, bringing a change in weather and a drop in temperature, the Central Weather Administration (CWA) said. The coldest time would be early on Thursday morning, with temperatures in some areas dipping as low as 8°C, it said. Daytime highs yesterday were 22°C to 24°C in northern and eastern Taiwan, and about 25°C to 28°C in the central and southern regions, it said. However, nighttime lows would dip to about 15°C to 16°C in central and northern Taiwan as well as the northeast, and 17°C to 19°C elsewhere, it said. Tropical Storm Nokaen, currently
PAPERS, PLEASE: The gang exploited the high value of the passports, selling them at inflated prices to Chinese buyers, who would treat them as ‘invisibility cloaks’ The Yilan District Court has handed four members of a syndicate prison terms ranging from one year and two months to two years and two months for their involvement in a scheme to purchase Taiwanese passports and resell them abroad at a massive markup. A Chinese human smuggling syndicate purchased Taiwanese passports through local criminal networks, exploiting the passports’ visa-free travel privileges to turn a profit of more than 20 times the original price, the court said. Such criminal organizations enable people to impersonate Taiwanese when entering and exiting Taiwan and other countries, undermining social order and the credibility of the nation’s
‘SALAMI-SLICING’: Beijing’s ‘gray zone’ tactics around the Pratas Islands have been slowly intensifying, with the PLA testing Taiwan’s responses and limits, an expert said The Ministry of National Defense yesterday condemned an intrusion by a Chinese drone into the airspace of the Pratas Islands (Dongsha Islands, 東沙群島) as a serious disruption of regional peace. The ministry said it detected the Chinese surveillance and reconnaissance drone entering the southwestern parts of Taiwan’s air defense identification zone early yesterday, and it approached the Pratas Islands at 5:41am. The ministry said it immediately notified the garrison stationed in the area to enhance aerial surveillance and alert levels, and the drone was detected in the islands’ territorial airspace at 5:44am, maintaining an altitude outside the effective range of air-defense weaponry. Following
RSS