SinoPac Financial Holdings Co (永豐金控) said yesterday that it plans to buy 100 percent of King’s Town Bank (KTB, 京城銀行) for NT$60 billion (US$1.83 billion) through cash and share swaps.
The two financial institutions would seek approval from regulators and shareholders next year, after respective board directors yesterday gave the green light, SinoPac spokesperson Kerry Hsu (許如玫) told reporters at the Taiwan Stock Exchange last night.
SinoPac would sponsor the deal with 50 percent in cash and the remaining half through a share swap scheme, Hsu said.
Photo: Kelson Wang, Taipei Times
Under the share swap arrangement, one common KTB share would trade for 1.15 SinoPac shares, Hsu added.
“We believe that the deal, valued at 1.1 times King’s Town’s price-to-book ratio, is reasonable, as the merger would enable SinoPac to reach out to more customers in southern Taiwan,” SinoPac Financial president Stanley Chu (朱士廷) said.
Most of King’s Town’s 66 branches are in Yunlin County, Chiayi County, Tainan, Kaohsiung and Pingtung County, while most of SinoPac’s 125 outlets are in northern Taiwan, Chu said.
SinoPac would retain all KTB employees for at least three years, Chu said, adding that SinoPac would provide bonuses for those who choose to stay, especially banking professionals.
The merger would make SinoPac Taiwan’s seventh-largest conglomerate by assets and the third-largest lender measured by loans to small and medium-sized enterprises (SME), Hsu said.
The synergy benefits also apply to banking services, given that KTB focuses on commercial banking, while SinoPac is more specialized in institutional banking and serving firms with larger amounts of capital, Chu said.
KTB chairman Tai Chen-chih (戴誠志) and vice chairman Tsai Chiung-ting (蔡炅廷) would not join SinoPac’s boardroom after an expected one-year integration because they prefer to be shareholders and trust SinoPac’s management, Chu said.
KTB would auction off its capital leasing unit and liquidate its securities arm, Chu said, adding that the former has a different business orientation from SinoPac’s capital leasing unit.
KTB’s securities house is small and should be able to settle its business with its current clients, Chu said.
Shares in SinoPac yesterday closed down 0.42 percent at NT$23.6, while KTB shed 0.9 percent to NT$49.55, Taiwan Stock Exchange data showed.
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
Greek tourism student Katerina quit within a month of starting work at a five-star hotel in Halkidiki, one of the country’s top destinations, because she said conditions were so dire. Beyond the bad pay, the 22-year-old said that her working and living conditions were “miserable and unacceptable.” Millions holiday in Greece every year, but its vital tourism industry is finding it harder and harder to recruit Greeks to look after them. “I was asked to work in any department of the hotel where there was a need, from service to cleaning,” said Katerina, a tourism and marketing student, who would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01