Company forgoes discipline
In response to the financial regulator's demand that China Dev-elopment Financial Holding Corp (中華開發金控) take self-punitive measures tomorrow, the company said yesterday that it had done nothing wrong in decision-making involving overseas investments and hence had no need to discipline staffers involved.
In a statement issued last night, the company said its banking unit China Development Industrial Bank (中華開發工銀) had exerted sufficient discretion in making a package sale of its overseas investment portfolio as well as in spinning off its asset management unit.
The company said the deals were proven to be helpful in its earnings last year, which grew 45 percent from 2005 to NT$1.38 per share. The policy-making and execution violated neither the law nor the firm's internal code of conduct, it added.
However, to demonstrate self-discipline and a sense of "moral responsibility," 11 of the company's high-level managers, including chairman Lin Cheng-i (林誠一) and president Angelo Koo (辜仲瑩), are willing to cut their monthly salaries by 30 percent for the next three months, the company said.
The Financial Supervisory Commission declined to comment on China Development Financial's decision, saying it hadn't received official notification.
On Dec. 14, the commission fined the bank NT$10 million and demanded punishment within one month of people responsible for serious internal control flaws in its decision-making process.
Executive's China trip confirmed
Taishin Financial Holdings Co (台新金控), owner of the nation's second-largest credit-card issuer, said yesterday that its chairman had visited Xiamen in China, prompting speculation it was looking for an investment opportunity in a bank in China.
The Central News Agency said earlier yesterday that Taishin Financial chairman Thomas Wu (吳東亮) went to Xiamen to visit clients who need financial services resulting from to the busy trade between Taiwan and China.
The company said in a statement later yesterday that Wu and his wife took a "private" trip to Xiamen, but didn't give any further details.
Costa Rica trade pact mulled
Costa Rica and Taiwan are considering negotiating a free trade pact, a newspaper reported on Thursday.
President Chen Shui-bian (陳水扁) made the proposal at a brief meeting in Managua on the sidelines of Nicaragua's presidential inauguration this week, La Nacion daily reported, quoting Costa Rican Foreign Minister Bruno Stagno.
Arias was said to be optimistic about the possibility, the report said, though no time frame was mentioned.
Chen also urged Costa Rica to join the APEC forum, it said.
Cosmos Bank rating affirmed
Taiwan Ratings Corp (中華信評) yesterday affirmed its "twA-" long-term and "twA-2" short-term counterparty credit ratings on Cosmos Bank (萬泰銀行), with a stable outlook, it said in a statement.
The ratings reflect the bank's good niche position in Taiwan's cash card market, Taiwan Ratings said. The bank's high-profile "George & Mary" cash cards commanded a 27 percent share of the domestic cash card market, in terms of total loan balance, at the end of November last year.
But the ratings agency warned of the lender's mediocre capitalization, saying it provides only a limited buffer against potential credit costs, the statement said.
NT dollar edges up
The New Taiwan dollar gained against its US counterpart yesterday, rising NT$0.014 to close at NT$32.760 on the Taipei Forex Inc.
Turnover was US$1.129 billion.
SELL-OFF: Investors expect tariff-driven volatility as the local boarse reopens today, while analysts say government support and solid fundamentals would steady sentiment Local investors are bracing for a sharp market downturn today as the nation’s financial markets resume trading following a two-day closure for national holidays before the weekend, with sentiment rattled by US President Donald Trump’s sweeping tariff announcement. Trump’s unveiling of new “reciprocal tariffs” on Wednesday triggered a sell-off in global markets, with the FTSE Taiwan Index Futures — a benchmark for Taiwanese equities traded in Singapore — tumbling 9.2 percent over the past two sessions. Meanwhile, the American depositary receipts (ADRs) of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the most heavily weighted stock on the TAIEX, plunged 13.8 percent in
A wave of stop-loss selling and panic selling hit Taiwan's stock market at its opening today, with the weighted index plunging 2,086 points — a drop of more than 9.7 percent — marking the largest intraday point and percentage loss on record. The index bottomed out at 19,212.02, while futures were locked limit-down, with more than 1,000 stocks hitting their daily drop limit. Three heavyweight stocks — Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), Hon Hai Precision Industry Co (Foxconn, 鴻海精密) and MediaTek (聯發科) — hit their limit-down prices as soon as the market opened, falling to NT$848 (US$25.54), NT$138.5 and NT$1,295 respectively. TSMC's
TARIFFS: The global ‘panic atmosphere remains strong,’ and foreign investors have continued to sell their holdings since the start of the year, the Ministry of Finance said The government yesterday authorized the activation of its NT$500 billion (US$15.15 billion) National Stabilization Fund (NSF) to prop up the local stock market after two days of sharp falls in reaction to US President Donald Trump’s new import tariffs. The Ministry of Finance said in a statement after the market close that the steering committee of the fund had been given the go-ahead to intervene in the market to bolster Taiwanese shares in a time of crisis. The fund has been authorized to use its assets “to carry out market stabilization tasks as appropriate to maintain the stability of Taiwan’s
STEEP DECLINE: Yesterday’s drop was the third-steepest in its history, the steepest being Monday’s drop in the wake of the tariff announcement on Wednesday last week Taiwanese stocks continued their heavy sell-off yesterday, as concerns over US tariffs and unwinding of leveraged bets weighed on the market. The benchmark TAIEX plunged 1,068.19 points, or 5.79 percent, to 17,391.76, notching the biggest drop among Asian peers as it hit a 15-month low. The decline came even after the government on late Tuesday authorized the NT$500 billion (US$15.2 billion) National Stabilization Fund (國安基金) to step in to buoy the market amid investors’ worries over tariffs imposed by US President Donald Trump. Yesterday’s decline was the third-steepest in its history, trailing only the declines of 2,065.87 points on Monday and
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