The Financial Supervisory Commission (FSC) on Wednesday said that it would scrutinize the financial health of the buyer of Prudential Life Insurance Co of Taiwan (保德信人壽) after local media reported that potential buyers submitted bids on Monday.
“The buyer’s financial strength must be solid enough to support the newly acquired life insurance business, and we will check its double leverage ratio and other gauges that show capital adequacy,” a Banking Bureau official told the Taipei Times by telephone.
Financial strength is critical as local life insurers must adopt International Financial Reporting Standards 17 in five years, which have stricter rules on the calculation of liabilities, the official said.
The buyer must be knowledgeable and competent in the insurance business, protect the rights of policyholders and honor all old policies, the official said, adding that the buyer is expected to retain part of the business’ staff and commit to operating it long-term.
Ruen Chen Investment Holding Co (潤成投資) had to commit to not selling Nan Shan Life Insurance Co (南山人壽) for a decade when it acquired the insurance company in 2011, the official said.
The commission rejected Taishin Financial Holding Co’s (台新金控) application to acquire New York Life Insurance Taiwan Corp (紐約人壽) in 2013, and turned down IBF Financial Holdings Co’s (國票金控) application to acquire MetLife Taiwan Insurance Co (大都會人壽) in 2010, the official added.
“The FSC has the power to veto a sale, so sellers in the financial industry usually take into account the commission’s criteria when reviewing buyers’ profiles, as they do not want to waste their time by selecting a buyer that would fail the regulator’s assessment,” a market analyst said.
The local unit of US-based Prudential Financial Inc on Wednesday confirmed that it is exploring strategic options, including a sale, but did not elaborate.
Taishin Financial Holding Co (台新金控) on Tuesday announced in a regulatory filing that its board of directors on Monday approved tendering a bid for an insurance company, without naming the company for the sake of confidentiality.
The Chinese-language Economic Daily News reported that First Financial Holding Co (第一金控) and Union Bank of Taiwan (聯邦銀行) had participated in the tender.
“It is understandable that some financial conglomerates without insurance units sought to acquire the foreign insurer, as the deal would give them new profit momentum, although they would face more pressure to retain capital adequacy,” Huang Der-yeh (黃達業), emeritus director of National Taiwan University’s Center for the Study of Banking and Finance, said by telephone.
Prudential Life Insurance Co of Taiwan, which began operations in 1990, has 700 sales personnel and 300 employees.
Its net worth fell to NT$7.2 billion (US$240.59 million) at the end of March, from NT$9 billion at the end of last year, company data showed.
UNWANTED ATTENTION: In the past two months, the automaker has made headlines, with a Chinese military ban of its vehicles and a protest at an expo Electric vehicle maker Tesla Inc, facing scrutiny in China over safety and customer service complaints, is boosting its engagement with regulators and beefing up its government relations team, industry sources said. Tesla’s change of strategy leading to more behind-the-scenes interaction with policymakers in Beijing compared with relatively little previously shows the seriousness with which the US automaker views the setbacks in its second-biggest market. TALKING SHOP It also comes at a time when China is trying to regulate large and powerful private companies, especially in the technology sector, on concerns about their market dominance. As they do elsewhere, regulators in China, the world’s biggest
Dell Technologies Inc has agreed to sell its Boomi cloud business to private equity firms Francisco Partners and TPG in a cash deal valued at US$4 billion, as part of efforts by chief executive officer Michael Dell to trim down the PC maker. The deal is expected to close by the end of this year, the companies said in a statement on Sunday without providing additional details of the terms. Dow Jones had earlier reported that the companies were near a deal. Boomi specializes in integrating different cloud platforms for companies and has more than 15,000 customers. Dell agreed to acquire the company for
Chinese electric vehicle (EV) start-up Nio Inc (蔚來) reported a narrower first-quarter loss, while warning that a global chip shortage would keep a lid on deliveries. The Shanghai-based company posted a net loss of 451 million yuan (US$68.8 million) in the three months ended March 31, compared with 1.69 billion yuan a year earlier, it said in a statement. It also marked an improvement on the 1.39 billion yuan net loss it posted in the fourth quarter of last year. Revenue rose to 7.98 billion yuan, beating estimates of 7.16 billion yuan. Nio delivered 20,060 vehicles in the quarter, a 423 percent increase from
Intel Corp wants 8 billion euros (US$9.7 billion) in public subsidies toward building a semiconductor factory in Europe, chief executive officer Pat Gelsinger was cited as saying on Friday, as the region seeks to reduce its reliance on imports amid a shortage of supplies. The pitch is the first time that Gelsinger has publicly put a figure on how much state aid he would want, as Intel campaigns to take on Asian rivals in contract manufacturing. “What we’re asking from both the US and the European governments is to make it competitive for us to do it here, compared to in Asia,”
RSS