Creditor banks led by Mega International Commercial Bank (兆豐國際商銀) yesterday unanimously opposed a restructuring plan proposed by two affiliates of the troubled Rebar Asia Pacific Group (力霸亞太企業集團) and demanded that the companies withdraw the application within the next week.
"All of us oppose the planned restructuring [of China Rebar Co (
The banks insisted that the two companies should withdraw the restructuring application they filed to the Taipei District Court within the next week and present a new operation program two weeks from now.
Wen said that the drawn-out restructuring procedure would prolong debt payback with low interest rates and force creditor banks to book their loans to the two debtors under the category of defaulted loans.
Wen added that this would negatively impact the banks' earnings.
Creditor banks will lodge their opposition to the restructuring plan with the court if the two companies refuse to rescind their application within the given term, he added.
On Dec. 29, both China Rebar and Chia Hsin applied to the district court for insolvency protection.
But the two companies had waited until Jan. 4 before announcing that they had won the court's approval on the same day.
That prompted public concern over the financial state of the Rebar Group, triggering a bank run at another Rebar affiliate, The Chinese Bank (中華銀行), last Friday before the lender was taken over by the government at midnight on the same day.
At yesterday's meeting, which was convened by Mega International, 15 of 17 lenders were present to discuss strategies for the future of China Rebar and Chia Hsin Food and Synthetic Fiber, whose combined debts exceed NT$28 billion (US$855 million).
Attendees included the Bank of Taiwan (台灣銀行), Chang Hwa Bank (彰化銀行), Chinatrust Commercial Bank (中國信託商銀) and The Chinese Bank.
China Rebar president Wang Lin-mei (
Her efforts seemed to have failed, however.
Participants at the meeting said that Wang had shown sincerity during the negotiations over the restructuring plan.
Wang said at the meeting that China Rebar was still capable of future operations, while Chia Hsin was not.
Creditor banks said that they had not discussed a preferential debt-paying scheme for drawn-out payback or reduced interest rates in exchange for the withdrawal of the restructuring application at the meeting.
However, if the court should approve the companies' restructuring plan, Mega International will turn to Gary Wang (王令麟), the chairman of the Rebar-linked Eastern Multimedia Group (東森多媒體), for NT$2.6 billion worth of debts that he has guaranteed, Wen said.
Gary Wang guaranteed a total of NT$6.3 billion in loans to China Rebar and Chia Hsin.
Meanwhile, Chang Hwa and another three creditor banks agreed in a separate meeting on a proposed four-year installment repayment of another NT$1 billion in debts, for which Gary Wang was a guarantor.
Gary Wang is required to pay NT$150 million by next Tuesday and NT$250 million by the end of this year, Chang Hwa spokesman Miles Chang (
The remaining NT$600 million will be paid quarterly within the next three years, Chang said.
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