Central Trust of China (
The Ministry of Finance, the sole shareholder in Central Trust, plans to sell the financial institution's banking unit, with a net value of NT$5.8 billion (US$180 million), and its life-insurance unit, valued at NT$3.5 billion, in separate auctions to garner a combined NT$10 billion to NT$15 billion.
"We'll select suitable consultants to deal with financial, insurance and legal affairs by the end of this month so as to facilitate the bidding process," Central Trust president Alex Wang (
Wang said the state-run company welcomes banks, financial holding companies and insurers both from home and abroad to participate in the open bidding.
But detailed qualifications and restrictions will only be hammered out after a financial consultant makes the final confirmation, he added.
Prior to holding the auction, the legislature has demanded Central Trust sign a collective agreement with its labor union about employee benefits. Currently, Central Trust has more than 1,900 employees.
In response, Wang said the company is currently drafting the agreement to prepare for several rounds of labor and management negotiations.
Central Trust, whose business operations include banking, insurance, trade and warehousing, reported pre-tax profits of NT$1.18 billion for the first seven months of the year, jumping by 90.31 percent from the same period last year.
Its earnings per share is NT$1.18 and the non-performing loan (NPL) ratio stands at 2.19 percent.
The government is encouraging domestic financial institutions to conduct merger and acquisition activities in a bid to compete with foreign rivals such as Citigroup Inc and HSBC Holdings Plc.
The Ministry of Finance privatized its stakes in two other state-run banking institutions by selling Taiwan Development & Trust Corp (
On July 22 Taishin Financial Holdings Co (
But not all privatization plans would proceed as smoothly as expected, as bank employees say the move would mean the loss of their jobs and other benefits.
Yesterday, over 600 union members of Taiwan Business Bank (台灣企銀) took to the streets in a bid the safeguard employees' rights, since the government is seeking to sell holdings in the state bank.
The union protested in the bank's headquarters in Taipei yesterday, asking the state-owned bank to sign a collective agreement as a guarantee of employees' work rights before being privatized.
The fierce demonstration reportedly sparked physical conflicts. The union planned to continue its protest outside the Ministry of Finance on Aug. 27 if their appeals had not produced the desired result.
Taiwan Business Bank said earlier this week that it has received takeover bids from other financial companies. The finance ministry is offering its 28.4 percent stake in the bank through a share swap, which has reportedly attracted several interested buyers, including Chinatrust Financial Holding Co (
The share sale is slated for September. Goldman Sachs is arranging the transaction.
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