The Financial Supervisory Commission (FSC) is to ease shareholding requirements on financial institutions in Taiwan’s Web-only banks, taking effect at the earliest at the end of next month.
The move comes as the nation’s three online banks — Line Bank Taiwan Ltd (連線商業銀行), Rakuten International Commercial Bank Co (樂天國際銀行) and Next Commercial Bank Co (將來商業銀行) — have reported combined losses of more than NT$9 billion (US$285.81 million) over the past few years, with each of them facing difficulties in raising capital.
The FSC yesterday finalized its proposed changes to the establishment standards for commercial banks, allowing a Web-only bank to adjust the proportion of shares held by financial institutions after three years in business, the commission said in a statement.
Photo: Kelson Wang, Taipei Times
Current regulations require financial institutions to hold a minimum 40 percent stake in a Web-only bank and cap stakes of nonfinancial enterprises at 60 percent.
The proposed amendments have removed that threshold, the commission said, adding that it welcomes other industries to become potential shareholders.
At least one bank or a financial holding company must still hold a minimum of 25 percent in a Web-only bank to ensure a certain degree of banking stewardship, it said.
The amendments also allow adjustments to the board of directors at Web-only banks, the FSC said.
Current regulations require that more than half of the board of directors of Web-only banks be represented by industry experts with backgrounds in banking, financial technology, e-commerce or telecommunications.
After the revision, the composition of their boards would align with that of commercial banks, meaning the requirement of an industry experts-majority would no longer be mandatory, the commission said.
The changes aim to introduce more diverse shareholders and increase flexibility in capital raising for Web-only banks, as well as encourage online banks to foster innovation and develop digital financial services, it said.
The commission said it would collect public opinion over the next 30 days after it releases the draft amendments.
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