Financial Relief Measures Will Be Extended to Year End

Taipei, May 28, 2012 (CENS)--In view of murky European-debt crisis and the languid stock market, the Financial Supervisory Commission (FSC) and the Bankers Association plan to extend the deadline for several financial relief measures to the end of the year, from the end of June originally, so as to help enterprises secure fund and alleviate selling pressure in the stock market.

The measures include corporate bailout programs, relaxation of margin calls for mortgaged stocks, and bailout for housing loans for involuntarily unemployed laborers.

The relief measures were launched by Bankers Association at the end of last year, under the instruction of FSC, in response to the “economic-situation countermeasures” approved by the Executive Yuan (the Cabinet).

The board of directors and supervisors of Bankers Association are scheduled to discuss and approve the proposed extension of the deadline for the financial relief measures this Thursday (May 31).

Under the financial relief measures, banks would refrain from selling mortgaged stocks outright, after their prices have dropped by a certain extent. Instead, banks would negotiate with clients for cutting stock maintenance rate or the provision of additional collaterals.

The relief measure can help enterprises in fund maneuvering and contribute to the stabilization of the stock market. Meanwhile, Bankers Association will urge the regulator asking securities firms to provide margin trading or short sale service to investors.

Under corporate bailout measure, enterprises with business difficulty can apply with the Ministry of Economic Affairs (MOEA) for assistance. With the backing of the MOEA, the largest creditor bank would convene other creditor banks for a meeting to discuss bailout measures. With the approval of two thirds of creditor banks, other creditor banks must abide by the bailout measures.