New financial exchange regulations unveiled

The regulations on permitting and managing cross-strait investment by monetary, insurance and securities firms were promulgated by the Financial Supervisory Commission (FSC) in line with the cross-strait memorandum on financial supervisory cooperation that became effective Jan. 16 after being signed by Taipei and Beijing last November.

Under the regulations, Taiwanese financial institutes, including banks, insurance and securities firms, are entitled to two of three options — establishing representative offices, branches or subsidiaries, and holding stakes in a Chinese bank or firm.

FSC Vice Chairman Kui Hsien-nung said China's financial market has become very competitive, with foreign banks opening 116 branches, 237 representative offices and 28 subsidiaries there as of the end of 2008.

On the contrary, Taiwan — with around 40,000 businesses pouring over US$82.7 billion-worth of investment into China — has only nine banks setting up representative offices there.

He urged Taiwanese banks and other financial firms to play a greater role in China in a bid to better serve the Taiwanese businesses there and to sharpen their own competitive edges.

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