An official of King's Town Bank (京城銀行), a medium-sized bank based in Tainan, said yesterday that the bank had no intention of selling out to banking groups in the near future.
The official's remarks came after the Chinese-language Commercial Times reported yesterday that King's Town had been approaching local banking groups including Fuhwa Financial Holding Co (復華金控), SinoPac Holdings (永豐金控), Waterland Financial Holdings Co (國票金控) and E.Sun Financial Holdings Co (玉山金控) over a possible buyout.
The four financial holding companies are thought to be potential buyers of King's Town as they plan to expand their market shares through mergers and acquisitions, the report said.
"We have no plans to sell the bank despite the constant merger and acquisition rumors ... however, we would not rule out the possibility of forming a strategic alliance with other partners," company spokesman Chen Ming-tai (陳銘泰) said yesterday.
However, more than one foreign financial institution has approached King's Town to "get to know" the lender, Chen said, refusing to reveal the names of the interested parties.
Late last month, it was reported that HSBC agreed to acquire the bank for between NT$18.9 (US$0.57) and NT$23.1 per share, but both parties denied the report.
Last month, it was reported that Carlyle Group planned to incorporate King's Town Bank and Far Eastern International Bank (遠東銀行) into Ta Chong Bank (大眾銀行), in which Carlyle holds a 36 percent stake.
However, King's Town dismissed the report.
King's Town Bank is the successor to Tainan Business Bank (
Tsai bought the bank at about NT$13 per share and hopes to sell it for NT$17 per share, the report said.
Shares of King's Town rose by 4.31 percent to NT$10.9 yesterday.
The bank briefed executives from the four financial holding companies yesterday on its operations and future plans, hoping to sell off all its holdings by the middle of next month, the Commercial Times report said, citing anonymous sources.
Of King's Town Bank's 63 branches, 56 are in central or southern Taiwan and target small and medium-sized enterprises in the region.
However, the bank has lost customers after many businesses began relocating their factories to China.
Though King's Town Bank has tried to expand into northern Taiwan, stiff competition has hindered its progress.
King's Town Bank posted net income of NT$106.7 million, or NT$0.01 per share, in the first quarter this year.
For the first seven months of this year, King's Town reported that its sales declined by 4.35 percent to NT$1.8 billion.
At this stage, King's Town Bank will focus on improving its asset quality and increasing profits by relocating underperforming branches in small towns to larger cities, Chen said.
The bank relocated four outlets last year and may move two more by the end of this year, he said.
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