The planned financial supervisory board (FSB,
Yen said he hoped the new supervisory body will function as a ministerial-level body under the Ministry of Finance, as is the practice with such agencies abroad. Nine nations including Great Britain, Sweden, Australia, Singapore and Canada all have financial supervisory bodies.
"The FSB is by its nature only responsible for financial supervision and does not engage in policy-making ... [foreign FSBs] are all under the jurisdiction of [the nation's] finance ministry," Yen said.
Under the proposed FSB bill, currently under legislative review, the three government bank examination agencies and the supervisory bodies for banks, securities and insurance companies are to be consolidated into one agency.
Yen made the comments following weeks of squabbling in the legislature over the make-up of the board. The disagreement between the ruling DPP and opposition parties has stalled the passage of the draft bill in the law-making body as it prepares to go into recess today.
The finance minister said the potential intrusion of politicians into the board is bad news for future FSB professionalism.
"If board members come from political parties, that will be a disaster," Yen said.
He added that "in order to keep [the board's] autonomy, legislators have to keep their hands out of the body."
Last week, Yen's boss, Vice Premier Lai In-jaw (賴英照), agreed, saying those most qualified to do the job should be selected for the board. "When political parties recommend academics or professionals [for the FSB], the priority should be on professionalism, instead of politics," he said.
When the Financial Holding Company Law (
Yen explained that the proposed FSB is expected to function as a quasi-judicial body to oversee newly formed financial holding companies. Therefore, maintaining the board's independence will safeguard it from political interference, he said.
Yen, however, disagreed with the Cabinet's original proposal to create a so-called "unified" FSB, which is expected to be charged with both financial supervision and policy-making.
When asked whether the finance minister would act as chairman of the board under the plan, Yen replied that "borrowing from foreign practice, FSB heads are either nominated by the finance minister or [recommended] by the minister, and subject to approval from the premier or the president."
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