Trade union members of the state-run Taiwan Cooperative Bank (合作金庫) and lawmakers yesterday held a press conference and attacked the former government's proposal, awaiting a final decision by the DPP administration, to turn the bank into a national agricultural bank and merge it with farmers' and fishermen's associations.
Opponents of the proposal are worried it would make the bank prey to "black gold" forces and cause a nationwide financial crisis.
According to the merger proposal, total holdings of the Taiwan Cooperative Bank's shares by the farmers' and fishermen's associations would be raised from 23 percent to more than 50 percent.
Many cooperative departments of local farmers' associations are controlled by gangsters, local factions and corrupt politicians and have serious management problems.
According to a recent remark by Chairman of the Council of Agriculture Chen Hsi-huang (
The national agriculture bank plan was originally proposed by the KMT administration earlier this year. The official purpose of the plan was stated as solving the management problems of farmers' and fishermen's associations.
But the plan was attacked by detractors as an attempt by the KMT government to bolster its local electoral apparatus.
The policy was inherited by the Tang Fei (
An Executive Yuan task force on Aug. 31 made an initial decision to push forward reform along the direction originally proposed by the KMT. Half a month later the Cabinet announced a halt to the plan and ordered further research but it remains an option and still disturbs its opponents.
"Bringing the troubled co-operatives in would drag down the Taiwan Cooperative Bank," said Ju Ching-huei (
"Once the `black gold' people sway the second-largest bank in the country, they would play their old tricks of making illegal loans and finally vacate the bank, just as they did to local farmers' and fishermen's cooperatives."
DPP Legislator Chien Hsi-chieh also warned of the possibility of such a scenario. "Now such bad cooperatives have gone bankrupt one after another but the crises are basically local. But, if the same thing happens to Taiwan Cooperative Bank then there will be a national financial crisis."
New Party Legislator Lai Shyh-bao (
He said as many as 15 farmers' cooperatives have a negative net value, adding, "These cooperatives should have been closed. But if the merger happens, holders of shares in these cooperatives would become shareholders of Taiwan Cooperative Bank. This is not fair to the bank's current shareholders and personnel."
A reasonable and positive solution is simply to let bad cooperatives perish, attendants of the meeting agreed.
"The financial situation of farmers' cooperatives varies. The government should first give up the incurable and save the savable. A hasty merger does not work," DPP lawmaker Wang Li-ping (王麗萍) said.
The Ministry of Finance said the proposal remained undecided.
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