■ Morgan Stanley a subsidiary
The Financial Supervisory Com-mission yesterday approved Morgan Stanley & Co International Ltd to turn its Taipei branch into a wholly-owned, Taipei-based subsidiary, a move that is in part made to bypass the nation's alternative minimum tax (AMT) regime.
"The change in status will prevent the possible taxation on parent company's overseas capital and transactions under current AMT regulations," the commission said yesterday at a press briefing.
The move was also based on the brokerage's expansion needs, as it intends to add proprietary and underwriting businesses to its current portfolio and to increase its capitalization to NT$1 billion, the commission said.
Separately, Gary Kuo (郭冠群), Morgan Stanley's head of investment banking business, is expected to replace Susan Lin (林水仙), Morgan Stanley's chief executive officer in Taiwan, reports said yesterday.
Lin may join AEA Holdings, a private US equity firm next month, reports said.
■ E.Sun revises outlook
E.Sun Financial Holding Co (玉山金控) announced yesterday that it has cut its financial forecast for this year after booking extra reserves to cover bad debts incurred from its credit and cash card business.
The financial group revised downward its forecasted pre-tax net income for this year to NT$370 million, or NT$0.13 per share, from NT$4.64 billion, the company said in a statement.
E.Sun Financial, the nation's eighth largest issuer of credit cards, made the announcement after making an extra outlay of NT$2.9 billion that put the company in the red with a net loss of NT$1.1 billion for the first six months of this year, the statement said.
The average non-performing loan (NPL) ratio of the nation's 44 local banks slid to 2.39 percent last month, down from 2.53 percent in May, after some banks sold-on their bad debt, according to the Financial Supervisory Commission.
In the meantime, the coverage ratio rose significantly from 43.72 percent to 47.52 percent, the commission said.
■ Textiles exports down
The value of Taiwan's textile exports amounted to US$5.89 billion in the first half of 2006, down 1.2 percent over the previous year, according to tallies released yesterday by the Ministry of Finance.
The greatest rate of decline was seen in ready-to-wear clothing exports, which fell 15 percent year-on-year to US$388 million.
During the period, the revenue generated by textile exports amounted to US$4.58 billion, which lagged behind electronics exports at US$11.02 billion and rubber exports at US$4.89 billion.
■ Premier urges CPC to cut costs
Premier Su Tseng-chang (蘇貞昌) yesterday asked state-owned Chinese Petroleum Corp (CPC, 中油) and Taiwan Power Co (Taipower, 台電) to make further structural adjustments to cut their operational costs.
The premier made the request after listening to a report by the Directorate General of the Budget, Account and Statistics (DGBAS) on the government's budget through the end of June.
The DGBAS report said that CPC's losses have increased to NT$19.6 billion (US$603.07 million) due to surging crude oil prices. The company is not permitted to pass on the full cost of price rises to final consumers.
For similar reasons, Taipower's losses have also increased, to NT$13.6 billion, the report said.
■ NT dollar down
The New Taiwan dollar lost ground against its US counterpart yesterday, declining NT$0.049 to close at NT$32.849 on the Taipei foreign exchange market.
Turnover was US$628 million.
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