Taiwanese awaits China's nod on bank

Taiwanese awaits China's nod on bank

SHANGHAI (AFP): A group of Taiwan business executives has finalized negotiations to set up a joint venture bank with Shanghai's Pudong Development Bank (PDB), a banking source said yesterday.

"We have been working on the bank for three years. We are waiting for final approval from the People's Bank of China," said Michael Tsang, who represents the Taiwanese interests in setting up the bank, to be called First Sino Bank.

"We are likely to get a license very soon from the indications," Tsang said, adding that the joint venture would be located in Shanghai's formative new financial center in Pudong New Area.

Further details of the Taiwanese investors involved in setting up the bank were not available.

PDB chairman Zhuang Xiaotian told AFP last month that PDB was negotiating with Taiwan interests to set up the joint venture bank.

Tsang said that the Taiwan shareholders would hold majority interest in the bank which would have a registered capital of US$100 million of which $50 million would be paid up initially.

"We want to increase the registered capital to $200 million in the near future," he said.

The bank would focus primarily on serving corporate Taiwanese clients and, secondly on overseas Chinese interests, Tsang said.

Taiwan investors are the biggest foreign investors in Shanghai and the quantum of investment is set to grow following a period of uncertainty last year.

Investment fell off after China launched a series of missile exercises aimed at Taiwan ahead of presidential elections on the island, which it regards as a renegade province.

"Before, Taiwan investors tended to concentrate in Guangdong and Fujian but now they are all over the country. This is why we want to set up in Shanghai because this will be the growth area," he said.