Taiwan Financial told to reduce Hua Nan stake

Taiwan Financial Holdings Co., the island's largest financial group, must cut its stake in Hua Nan Financial Holdings Co. to below 25 percent within three years and consider selling the rest, the industry regulator said.

"We also ask Taiwan Financial to evaluate selling the remaining stake in Hua Nan, though no timetable is given for this part," Susan Chang, vice chairwoman of the Financial Supervisory Commission, said in a phone interview in Taipei yesterday. Except for the purpose of mergers, a financial holding company can't invest in other financial holding companies, Chang said.

Shin Kong Financial Holding Co., which currently owns 7.9 percent of Hua Nan, may buy the stake, the Taipei-based Economic Daily News newspaper reported yesterday, without citing anyone.

"We'll do an evaluation on this if the government really wants to sell the stake," Shin Kong Executive Vice President Victor Hsu said in a phone interview in Taipei yesterday. He said Shin Kong has some holdings in Hua Nan, though he can't immediately confirm the exact stake it's holding now.

Taiwan Financial Holdings was officially formed Tuesday and has under its umbrella state-run Land Bank of Taiwan, Export- Import Bank of ROC, and Bank of Taiwan. It will have assets of NT$5.12 trillion, becoming Taiwan's largest financial group by assets, the commission said Dec. 27.