United World planning China office

United World Chinese Commercial Bank (世華聯合商銀), the nation's fifth-largest bank by market value, said it's seeking permission to open an office in China to service Taiwanese companies moving operations to China.

Taiwan and China are increasing financial links even though the two countries have no formal diplomatic relations.

The Cabinet last month said that banks could open representative offices in China to service the many companies who are moving operations to China to lower costs.

United World asked the Ministry of Finance to be allowed to open a representative office in Shanghai, spokesman Chen Chien-chih (陳謙治) said. Permission would then be required from mainland regulators.

Thousands of companies have moved factories across the Taiwan Strait in an exodus that's being blamed for rising unemployment and slowing economic growth in Taiwan.

Unemployment rose to a record 4.4 percent in May after the economy expanded at 1.1 percent in the three months through March, the slowest pace in a quarter century.

Taipei at present does not allow banks to seek full branch status in China, fearing that increasing reliance and deepening links with China's economy will make Taiwan even more vulnerable to China's military and economic threats.