Home / Taiwan Business
Thu, Feb 08, 2001 - Page 18 News List

MOF to announce new mergers

FINANCE The Minister of Finance Yen Ching-chang said yesterday that the second round of domestic bank mergers would be announced in the first half of this year

By Stanley Chou  /  STAFF REPORTER

"The Ministry of Finance will announce the second merger case in domestic financial institutions in the first half of this year," said Finance Minister Yen Ching-chang yesterday.

"Any rumor on bank mergers could significantly affect the share prices of the banks involved. In order to comply with regulations of the Securities Exchange Law, before it's absolutely certain, the ministry would be unable to disclose any information [on the merger]," the finance minister said.

"The ministry has set the year 2001 as the year in which domestic financial institutions will be completely reshaped," said Yen. "Taiwan will not be absent in the international trend for financial sector mergers. Large financial institutions are our goal. Meanwhile, domestic private financial institutions are also considering how to participate in the merger activity."

"The 12 state-controlled banks will participate in the latest merger activities," stressed Yen. "I communicated with executives of all the 12 banks on this issue before Lunar New Year. A second stage of discussion would be arranged [in the near future], in order to discuss a detailed framework for mergers."

On Tuesday it was rumored the International Commercial Bank of China (ICBC, 中國國際商銀) would be merged with other banks. A number of banks' shares, including ICBC's, rose because of the rumor.

"Before February 15, no bank merger case would be announced," said Yen in response to the rumor.

ICBC has been connected with Chiao Tung Bank (交通銀行) and United World Chinese Commercial Bank (世華聯合商銀) in a possible merger since last year.

A number of bank executives described the merging of the three banks as a golden combination, since the business of the three could fully complement two other banks and form ideal large banks.

Another speculation on the second bank merger case is that Chang Hwa Bank (彰化銀行). Hua Nan Commercial Bank (華南商業銀行), and First Commercial Bank (第一商業銀行), the three largest commercial banks in the country, will merge. Part of the speculation came from Yen's comment on the market share earlier this year. Yen said he wants the merged banks to have a market share of 15 percent to 20 percent. The three banks combined could easily meet Yen's requirement.

A third possible combination, according to bank executives, is for the three largest commercial banks to combine with the three banks, including ICBC and the other two banks mentioned above. This combination could occupy more than 15 percent of the market share in the domestic banking sector.

However, the ministry has not disclosed any information on the second bank merger so far, after Taiwan Cooperative Bank (合作金庫) and ChinFon Commercial Bank (慶豐銀行) announced the first bank merger case earlier this year.

This story has been viewed 3066 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top