Fubon Financial Holding Co (富邦金控), the nation’s second-largest financial service provider by asset size, has struck a deal with Shanghai-based First Sino Bank (華一銀行) to buy an 80 percent stake in the Chinese lender for 5.65 billion yuan (US$905 million) to facilitate Fubon’s expansion into China, a senior executive said yesterday.
The deal, which is pending regulatory approval in Taiwan and China, will give Fubon Financial 14 banking branches and outlets in first-tier Chinese cities in the Pearl River Delta, the Yangtze River Delta and the Bohai Economic Rim.
The development is a significant step toward Fubon Financial’s aim of tapping the Chinese market, as its local peers set up their first or second branches in China.
“After more than a year of negotiations, we have reached an agreement with First Sino Bank to acquire 80 percent of its shares and join its capital increase plan,” Fubon Financial president Victor Kong (龔天行) told a media briefing.
Fubon Financial and its banking arm are to contribute 800 million yuan to First Sino, Kong said.
The transaction will be carried out in cash, with Fubon Financial to take a 29 percent stake in First Sino and Taipei Fubon Commercial Bank Co (台北富邦銀行) to take the remaining 51 percent, Kong said, adding that Shanghai Pudong Development Bank (浦東銀行) would retain the remaining 20 percent of the shares.
A foreign investor is also to take part in the deal via a 4 percent stake in Fubon Financial, Kong said, declining to reveal their identity.
The transactions total 6.45 billion yuan — 2.18 times First Sino’s net worth — Kong said, adding that such a deal was “unprecedented” given the healthy asset quality and earning ability of the lender.
Established in 1997 to serve Taiwanese firms, First Sino Bank is ranked as the third most profitable foreign lender in China after Citibank and HSBC, Kong said.
The lender has a bad loan ratio of 0.15 percent and a coverage ratio of 927 percent, with returns on equities standing at 13.5 percent last year, the Chinese bank says on its Web site.
To finance the expansion, Fubon Financial aims to inject NT$7 billion of new capital into its banking subsidiary to keep its exposure in China under the 15 percent limit stipulated by financial regulations, Kong said.
The conglomerate also plans to enlarge its own capital by between NT$20 billion and NT$25 billion — NT$15 billion of which it plans to raise on the open market — to shore up its financial strength, Kong said.
Fubon Financial will shelve plans to establish branches in China after authorities approve the stake purchase, because foreign banks can only own branches or subsidiaries, but not both, Kong said.
Apart from expanding into first-tier Chinese cities, Fubon Financial is in talks with city-level Chinese lenders to forge strategic partnerships to reach customers beyond Fujian Province, where it owns a 20 percent stake in Xiamen City Commercial Bank (廈門商銀), Kong said.
“The effort will soon bear fruit,” in keeping with the group’s bid to deepen its presence in China, he said.
National Taiwan University (NTU) yesterday said it disqualified a person from an entrance examination for using AI smart glasses to cheat, along with two others for making untruthful statements in their curriculum vitae. The three applicants were given null scores, Taiwan’s highest-ranked university said, calling on prospective students to be honest in the admissions process. NTU registrar Lee Hung-sen (李宏森) said that the cheating applicant wore a hat and thick-rimmed glasses to the second written exam for medical school, claiming that they felt cold. Suspicions were aroused when the applicant stared oddly at the test for long stretches while steadily bringing the paper
MILITARY ISSUES: A partisan divide between the Cabinet and the legislature ‘raised questions about Taiwan’s ability to adequately fund its defense,’ the report said Taiwan’s defense budget, military personnel numbers and resilience are challenges to its ability to meet national defense goals, the US Naval Institute said in a report published on Tuesday. In response to the perception of a growing military threat posed by China, Taiwan has embarked on an effort to enhance the capabilities needed to deter an attempt by Beijing to annex the nation by force, the institute said in the US Congressional Research Service report, titled Taiwan: Defense and Military Issues, which was filed on Thursday last week. Taiwan’s defense budget increased by about 7.5 percent from 2024 to last year, it
66 FIGHTER JETS: The aircraft is likely undergoing preparations for its transfer to Taiwan — a significant step forward in the nation’s modernization program, a lawmaker said The first of Taiwan’s order of F-16V Block 70 aircraft has been sighted in Texas ahead of delivery, Democratic Progressive Party (DPP) Legislator Wang Ting-yu (王定宇) said. Taiwan’s first F-16V Block 70 two-seat aircraft, tail number 6831, was seen flying from Lockheed Martin’s production facility in Greenville, South Carolina, to Naval Air Station Joint Reserve Base Fort Worth in Texas, Wang wrote on Facebook yesterday. The plane is likely undergoing preparations for its transfer to Taiwan, marking a significant step forward in the Republic of China Air Force’s modernization program, Wang said, citing military analysts. The F-16V Block 70 is a new-build version
NOT JUST NUMBERS: What matters to intelligence work is crucial, reliable information, so even a few credible leads can be highly valuable to national security, a legislator said The National Security Bureau (NSB) yesterday said it has finished the establishment of an information-reporting channel for Chinese nationals, the aim of which is to broaden intelligence gathering on China’s political, military, economic and social developments. Chinese nationals can submit information on the Web page, https://report.nsb.gov.tw, the NSB said in a statement. The move aims to expand the bureau’s diverse intelligence sources and is pursuant to the National Intelligence Services Act (國家情報工作法), it said, adding that it referenced practices adopted by intelligence agencies in the US, the UK and Israel. An increasing number of people are approaching Taiwanese agencies to provide information, as
RSS