Taipei, June 28, 2012 (CENS)--China's Taiwan Affairs Office recently redefined “Taiwanese enterprises” to enable Taiwanese banks in China to have better chance to expand clientele there.
Insiders say that the recent permission given to such banks to handle renminbi (RMB) businesses, coupled with more Taiwanese enterprises as potential clients, will enable an estimated 30%-plus profit growth this year.
Eight of Taiwan's government-linked banks in China are expected to post profits of NT$736 million (US$24.53 million) this year, or as much as NT$1 billion (US$33.33 million).
Taiwanese banks in China are disallowed to handle RMB businesses until one year after opening and profitable. Last year six Taiwanese banks, including Land Bank of Taiwan, Taiwan Cooperative Bank, First Commercial Bank, Chang Hwa Bank, Hua Nan Bank and Cathay United Bank, with branches in China offered mainly U.S. dollar-based financial services to Taiwanese enterprises.
With Beijing's redefinition of “Taiwanese enterprises,” the above-mentioned six banks have turned in applications to handle RMB business, with only Chang Hwa Bank being approved by the China Banking Regulatory Commission.
Besides, the China Securities Regulatory Commission has recently lifted restrictions on the qualification of QFII (qualified foreign institutional investors), enabling Taiwan's four leading securities firms, including Yuanta Core Pacific Securities, KGI Securities, Fubon Securities, and SinoPac Securities, to invest in stock markets in China.
(by Judy Li)