Taiwan's national stabilization fund has drafted six methods to sell its holdings, one of which would entrust a large portion of stocks to securities consultancies or trust firms for management, the Chinese-language media reported yesterday.
Under this method five to 10 such firms would be commissioned for portfolio management. Sales of holdings would also be carried out over a two-year period under the principle that sales shouldn't impact the stock market and no stocks should be sold at a loss.
The paper said adoption of this method would also help to bolster the portfolio management business.
The stabilization fund has already begun contacting various companies with regards to selling its stakes in high-tech companies, such as Taiwan Semiconductor Manufacturing Co (
The report said the fund's steering committee is likely to formally decide on methods of disposing holdings at a regular meeting in the middle of July.
The other four possible methods of selling holdings include disposing of stocks in block trades, selling exchangeable bonds overseas, setting up a fund based on the Hong Kong model or selling stock back to companies as a form of the treasury stock system.
The report said that the fund's holdings at the end of March amounted to around NT$170 billion.
Over the past year, the Ministry of Finance has racked up roughly NT$50 billion in paper losses attempting to support the market with its NT$500 billion National Stabilization Fund.
At the four government-related pension and labor insurance funds, the paper losses amount to roughly NT$100 billion.
RSS