With the Economic Cooperation Framework Agreement (ECFA) having taken effect yesterday, China might announce approval for a first group of Taiwanese banks to set up branches in China as early as next month, banking industry officials said.
“‘The sooner we can open for business in China, the earlier we can profit’ has become a slogan for Taiwan’s banking institutions,” an official said on Saturday.
Banking industry officials said most Taiwanese banks are putting a lot of effort into launching trade financing and working capital financing for Taiwanese businesses in China, trying to expand their lending base.
ACTION PLAN
First Financial Holding Co (第一金控) chairman Joseph Tsai (蔡慶年) said the Taiwanese banking industry should first focus on developing the financing business for small and medium-sized Taiwanese companies currently operating in China.
Tsai said the next phase should involve developing wealth management business for local Taiwanese businessmen and asset-rich customers.
He also said that Taiwanese banks should consider setting up branches in the Chinese cities of Chongqing, Chengdu, Dalian and Shenyang to cultivate the markets there.
Taiwanese banks that have been given permission by the Financial Supervisory Commission to upgrade their representative offices in China to branches include Hua Nan Commercial Bank (華南銀行), First Commercial Bank (第一銀行), Taiwan Cooperative Bank (合作金庫銀行), Chang Hwa Commercial Bank (彰化銀行), Cathay United Bank (國泰世華銀行) and Land Bank of Taiwan (土地銀行).
The banks are currently awaiting approval from China’s banking regulatory commission to establish branches.
PROCESS
According to the ECFA’s “early harvest” program, Taiwanese banks can upgrade their representative offices in China to branches one year after being set up, and the branches can begin offering yuan-denominated banking services after two years of operations if profits have been registered for the second year.
However, any Taiwanese bank branch which registers profit within one year of operation in China can offer yuan-denominated banking services, but only for China-based Taiwanese businesses.
These are seen as major Chinese concessions under the ECFA because other foreign banks have to wait at least five years before they are allowed to offer yuan-denominated banking services.
INTEREST
However, other Taiwanese banks — ones that have not been able to enter the China market in the first group — are also trying to use a variety of means to initiate cooperation with Chinese banks.
SinoPac Holdings Co (永豐金控) and its banking and security subsidiaries have signed a memorandum of understanding, or an alliance agreement, with its Chinese counterparts, while Taishin Financial Holding Co (台新金控) also announced last week that it will sign a letter of intent with Nanjing Zijin Investment Co (南京紫金).
Far Eastern International Bank (遠東商銀) is planning to sign a letter of intent with Bank of Chongqing (重慶銀行) and is expected to become one of the first Taiwanese banks to develop business in a so-called “green channel” region in southwestern China.
Sweeping policy changes under US Secretary of Health and Human Services Robert F. Kennedy Jr are having a chilling effect on vaccine makers as anti-vaccine rhetoric has turned into concrete changes in inoculation schedules and recommendations, investors and executives said. The administration of US President Donald Trump has in the past year upended vaccine recommendations, with the country last month ending its longstanding guidance that all children receive inoculations against flu, hepatitis A and other diseases. The unprecedented changes have led to diminished vaccine usage, hurt the investment case for some biotechs, and created a drag that would likely dent revenues and
Macronix International Co (旺宏), the world’s biggest NOR flash memory supplier, yesterday said it would spend NT$22 billion (US$699.1 million) on capacity expansion this year to increase its production of mid-to-low-density memory chips as the world’s major memorychip suppliers are phasing out the market. The company said its planned capital expenditures are about 11 times higher than the NT$1.8 billion it spent on new facilities and equipment last year. A majority of this year’s outlay would be allocated to step up capacity of multi-level cell (MLC) NAND flash memory chips, which are used in embedded multimedia cards (eMMC), a managed
CULPRITS: Factors that affected the slip included falling global crude oil prices, wait-and-see consumer attitudes due to US tariffs and a different Lunar New Year holiday schedule Taiwan’s retail sales ended a nine-year growth streak last year, slipping 0.2 percent from a year earlier as uncertainty over US tariff policies affected demand for durable goods, data released on Friday by the Ministry of Economic Affairs showed. Last year’s retail sales totaled NT$4.84 trillion (US$153.27 billion), down about NT$9.5 billion, or 0.2 percent, from 2024. Despite the decline, the figure was still the second-highest annual sales total on record. Ministry statistics department deputy head Chen Yu-fang (陳玉芳) said sales of cars, motorcycles and related products, which accounted for 17.4 percent of total retail rales last year, fell NT$68.1 billion, or
In the wake of strong global demand for AI applications, Taiwan’s export-oriented economy accelerated with the composite index of economic indicators flashing the first “red” light in December for one year, indicating the economy is in booming mode, the National Development Council (NDC) said yesterday. Moreover, the index of leading indicators, which gauges the potential state of the economy over the next six months, also moved higher in December amid growing optimism over the outlook, the NDC said. In December, the index of economic indicators rose one point from a month earlier to 38, at the lower end of the “red” light.
RSS