China banks may gain board seats with local banks: Chang
By Ted Chen, The China PostTAIPEI, Taiwan -- Finance Minister Chang Sheng-ford (張盛和) yesterday indicated that with stipulations, representatives from China-based banks may gain board positions at Taiwan's financial institutions.
April 4, 2013, 12:05 am TWN
Chang stated that management representatives from China-based banks may assume board member positions at Taiwan's state-owned banks as long as they do not attempt to exert influence upon its management.
According to Chang, many state-owned banks are jointly held by shareholders from the public and private sectors. Chang stated that the Ministry of Finance's stance is to retain guidance over the operation of state-owned banks, and that the public sector can do little to stop privately owned shares from changing hands in the open market.
“It is nothing more than a form of investment,” said Chang while describing the possibility of mainland representation on the board of directors of Taiwan's state-owned banks.
Additionally, Chang reiterated that on the matter of board representation, there is no dialogue between regulators on both sides of the strait, while dispelling rumors of alleged clandestine negotiations. Current cross-strait negotiations are limited to terms governing the establishment of branch locations, said Chang, adding that there are no plans for Taiwan's state-owned banks to acquire ownership stakes of mainland banks.
In response to questioning from a ruling party lawmaker who stated that mainland entities may use the acquisition of ownership stakes and board positions to initiate managerial sabotage, Chang replied that he valued the lawmaker's suggestions, while pledging to not progress hastily in the matter.
On the proposed consolidation of the banking sector, Chang stated disapproval over the acquisition of a larger bank by a smaller counterpart, and the merger between privately operated and state-owned banks. Mergers between private and state-owned banks would face tremendous complexity, according to Chang.