Episode I

Taiwan Banking – Sinking or Swimming?

Alan Liu Revisits Taiwan’s Financial Market

Financial liberalization, banking privatization, fierce competition,
increasing non-performing assets –
this is the present phase of Taiwan Banking  -
a Win More- Lose More Phase
that Alan Liu perceives during his revisit to Taiwan’s financial market.

Alan Liu is retired banker - but not tired of banking matters. See his biography at www.lcviews.com

My Journey through Taiwan Banking

Taiwan banking has gone through important three phases, with each phase having its ‘win’ or ‘lose’ as far as customers and banks are concerned. However, the further it goes, the worse it becomes. Immediate and effective measures must be taken by government in order to make sure that banks are swimming and not sinking.

Unlike it banking keeps on changing with changing time

1. Win-Win Phase

This phase covers the period from the past to about June1991 (in which 15 private banks were approved, with one in 1992). Perhaps it may be called as ‘traditional banking’ phase.

All banks with Domestic Banking Unit (DBU) are dealing in commercial banking (export/import LC operations, documentary collections, foreign-currency deposits and remittances, issuance of standby LC (SLC), cross-strait correspondent banking). DBU used to be called ‘International Department’ or ‘Foreign Banking Department’ by local banks or ‘Bills Department’ by foreign banks in Taiwan. It only deals with residents which refer to Taiwan residents and Taiwan-registered corporate customers.

In 1983, laws and regulations on Offshore Banking Unit (OBU) banking business were passed. At the end of 2005, there were 70 banks holding OBU license (41 local banks and 29 foreign banks), allowing them to deal with non-residents which refer to non-Taiwan residents (holding foreign passports), corporate customers not registered in Taiwan and Taiwanese offshore companies (registered in tax heaven countries or offshore financial centers) in same kinds of commercial banking as mentioned in DBU and investment banking (sales and purchase of securities in foreign currencies, underwriting for offshore securities, international syndication loans, custodian and consultancy services). Banking transactions conducted through OBU are, in principle, exempt from Taiwan’s foreign exchange controls, business tax, income tax, stamp duty and deposit and loan reserve.

Now banks with OBU license are allowed to deal with banks in China, both domestic and foreign, in commercial banking as mentioned above, with exception of issuing SLC from Taiwan’s banks (SLC issuer) to China’s banks (SLC beneficiary) or Taiwan’s banks (SLC beneficiary) accepting SLC from China’s banks. However, this can be arranged under a counter SLC to a bank in Hong Kong (third country) against which the Hong Kong bank issues its SLC to a bank in China (Hong Kong bank’s SLC beneficiary).

During this phase (the past to June 1991), government-owned banks used to dominate the local banking business until early 1991, when Taiwan embarked on financial liberalization by granting new banking licenses and encouraging foreign banks to join the domestic market. As a result of increasing competition and the government’s privatization policy, 1991 marked the turning point for market dominance to shift from government-owned banks to private banks and foreign banks. Up to the end of 2002, nine government banks were privatized.

Local financial institutions, which include big government banks, provincial banks, city banks, regional credit cooperatives (for farmers and fishermen), three overseas-Chinese-invested banks and foreign banks, all enjoyed great profit and non-competitive banking business from government entities and small- and medium-sized companies (most of them are export-oriented) which contributed greatly to the growing foreign exchange reserves, now reaching US$257 billion as published by The Central Bank of China in April 2006.

During this phase of banking business, customers doing export and import trades had tried their best to build up their guanxi (relationship) with their bankers in order to get more credit line and favorable loan terms. If banking guanxi was not well established, exporting and importing customers would find it hard to get loans from banks under LC transactions (which accounted for about 85% as payment tool in Taiwan’s international trade at that time), thus labeling banks as pawn shops in providing their services. Thanks to great profit margin by customers and considerable banking fees charged by banks, both parties enjoyed a win-win deal.

2. Win Some-Lose Some Phase

This phase covers the period from July1991 to June 2001 (10-year). With so many private banks and other big players chasing few customers for business (some of the small- and medium-size companies as well as labor-extensive manufacturers had moved to China due to increasingly high local labor cost, low economic growth, poor investment environment and tax concerns), commercial banking business in this phase had greatly dropped and profit margin was squeezed due to fierce competition among banks.

State-controlled banks, private banks and foreign banks were competing for businesses from creditworthy high-tech or electronics companies through their cut-throat pricing competition and larger credit line at favorable terms which were much better than those offered in the first phase. Newly-established small- and medium-sized companies were hard to get credit line from banks unless backed with collaterals. Despite this, some bank loans related to trade finance were loosely granted, leading to mounting bad debts when 1997-1998 Asian financial crisis hit.

Moreover, quite a number of frauds orchestrated by fraudsters (who are both exporters and importers) were reported and banks were saddled with bad debts because of their loose credit checking and lack of risk management in granting loans to these fraudsters. Banks often suffered big loss when customers defaulted on their debts. Handling charges received by banks did not justify their risk in providing loans to customer. Winners belong to those customers who were granted with better credit line by banks and those fraudsters who milked banks of funds. Many banks ended up being the losers in this business.

3. Win More-Lose More Phase

This phase covers July 2001 to July 2006 during which credit cards, cash cards and consumer loans were strongly pushed by local banks, especially private banks, in order to increase their profit and market share due to bad debts caused in the second phase. Banks did not focus on commercial banking as its profit was too thin that they pushed hard for credit card, cash card and consumer loans which earned them handsome profit.

To boost their market shares, banks had issued cards with only loose credit checking. As banks charged an average interest of 18% to 20% per annum for borrowing with either credit card or cash card, loan burdens had piled up soon to a point where numerous cardholders could not repay their debts or even pay monthly interest charges. Taiwan, with a population 23 million, had 45.5 million cards in circulation at the end of 2005, more than double the 18.3 million in 2000.

During this phase, several mergers and acquisitions between banks and 14 financial holding companies (FHCs) had been completed – making Taiwan’s banking business more competitive. Banks under FHCs were reluctant to take the risk of exploring new customers with less credibility in order to bolster steady growth in their lending business. Bank executives had admitted that they extended new loans too loosely in order to gain market share. There were 50 banks in Taiwan and cut-throat-pricing competition is almost inevitable.

Without doubt, this ‘putting all eggs in one basket’ approach had led to huge non-performing loans which surfaced in 2005, causing financial and social problems both to banks and customers. Several measures by government were implemented in order to mitigate this impact. Bad debts were estimated to total roughly US$24.6 billion, accounting for about 5% of Taiwanese banks’ non-performing loans (NPLs). Rising loan burdens also led to a surge in defaults, forcing banks to write off some US$2.2 billion in bad credit card and cash card loans in 2005. Five banks issuing credit cards and cash cards have written off US$31.4 billion in nonperforming loans in the first half of 2006. At the end of June 2006, nonperforming loan rates in credit cards and cash cards stood at 3.03% and 6.88% respectively. The issue has damaged profitability at some Taiwan banks and prompted widespread public concern over mushrooming consumer debts.

As banks had shown no interest in their card business, consumers thus turned to other channels for borrowing money. This had placed banks in a bad situation to compete against other non-banking lending institutions (such as underground money lenders or loan sharks), leading to an unhealthy consumer lending market in Taiwan.

Due to bad loans in credit card, cash cards and consumer loans, banks are switching quickly to wealth management (private banking), and are turning back to commercial banking which is still important and necessary in international trade, especially cross-strait trade with China where thousands of Taiwan’s small- and medium-sized companies and labor-intensive manufacturers have been doing business and almost a million of Taiwanese people living in China.

With 14 financial holding companies (FHCs) in over-banked Taiwan, they had to lure new customers to justify their size and profit. Mergers within these FHCs or mergers between banks and FHCs were negotiated. The big get bigger is nothing new under such circumstance. They are the winners while cardholders and consumer-loan borrower are the losers or in the opposite direction.

Great turning points in Taiwan’s banking sector

To resolve the over-capacity problem in the banking sector, the Financial Institutions Merger Law was passed in December 2000 while the Financial Holding Company Act was implemented in June 2001. Up to the first quarter of 2003, only one case of full banking merger came out in May 2002, although there were 14 cases of consolidation among financial institutions to form joint financial holding companies.

On 10 July 2003, the Financial Supervisory Commission (FSC) was set up and commenced operation since 1 July 2004. Since then, the authority of financial supervision has shifted from the Ministry of Finance to FSC.

The primary function of FSC is to consolidate the supervision and examination of banking, securities and futures, insurance as well as the financial holding companies under one supervisory authority with greater independent power. It also serves to integrate and harmonize the regulations and policies among different financial supervisory agencies.

FSC’s main missions and objectives cover the following:

• To maintain financial stability
• To prevent systemic risks
• To combat financial crimes and money laundering
• To accelerate internationalization and deregulation
• To revise and promulgate rules to be in line with international practices
• To expand collaboration with financial regulators in other countries
• To facilitate healthy investment environment and increase market confidence
• To improve corporate governance

Though missions and objectives are clearly set, whether they can be effectively carried out or achieved in a short time remain to be seen.

The financial reform over the past two years was aimed at reducing the number of Taiwan banks from the current 47 while pushing ahead with the privatization of state-controlled banks and reducing government stakes in them. Although the banking-sector consolidation began in 2002, the move has been slow and state-controlled banks still account for 50% of loans and nearly 70% of deposits. According to the Financial Supervisory Commission (FSC), the main purpose of the financial reform is to enhance international competitiveness. Taiwan’s top five banks only account for a 38% of total market share.

Taiwan has been dragging its feet for too long in sorting out its banking problems whereas China has been making great progress in cleaning up its banks. Total profit of local banks dropped 49.38% in 2005 while that of foreign banks dropped 11.95%.

Government policy goals set in 2004

The government announced on 20 October 2004 four clear policy goals for which the Financial Supervisory Commission (FSC) acts as a catalyst in removing obstacles for mergers and acquisitions. These goals are:

• To halve the number of government-controlled banks from 12 to 6 by end-2005.
• to establish three banks with market shares of 10% or more by end-2005 and one with 20% market share within three years.
• To reduce the number of financial holding companies from 14 to 7 by end-2006.
• To have one financial institution managed by foreign investors or listed on an overseas stock exchange by end-2006.

While the government may be clear on what it intends to do, achieving its goals is another matter.

Data and Facts worth Noting

1. Foreign exchange reserves (in US billion)

At the end of May 2006, foreign exchange reserves of following Asian countries were posted as below:

Russia, an emerging country, posted US$262.9 billion of foreign exchange reserves on 21 July 2006, outpacing Taiwan’s US$260.3 billion as posted on 5 July 2006. This makes Russia the third largest country holding huge forex reserves in the world. China’s forex reserves accumulated from January to June 2006 posted US$122.3 billion.

2. Trade surplus and trade figures with China (including Hong Kong)

Trade surplus and trade figures (in US billion) with China (including Hong Kong) were listed as below:

From January to May 2006, Taiwan posted a trade surplus of US$15.13 billion while its overall trade surplus of the same period registered US$6.53 billion. Without the trade surplus with China, Taiwan would have posted a trade deficit of US$8.6 billion in this period.

South Korea’s GNP ($16,291) outpaced that of Taiwan ($15,676) in 2005, with a difference of US$615. In 1992, South Korea only had $7,539 whereas Taiwan had $10,274. Taiwan is now the last in this four-dragon club, and difference in GNP will be widening. Taiwan government has recently stated that it will boost its GNP to $30,000 by 2015. This is like the blind leading the blind or a stupid guy cheating an idiot.

4. Kaohsiung port’s competitiveness falling fast

Kaohsiung port has quickly lost its competitiveness because of Taiwan’s five-decade ban on sea links with China, and the expansion of foreign ports, especially Chinese port. According to Containerization International magazine, the top world container ports ranked in 2005 were:

1. Singapore

2. Hong Kong

3. Shanghai

4. Shenzhen

5. Busan

6. Kaohsiung

7. Rotterdam

8. Los Angeles

9. Hamburg

10. Dubai

According to the magazine’s March 2006 issue, container volumes of all top 30 container ports, except Kaohsiung port, have risen, with some even by 20%. Koahsiung was the world’s third-largest container port in 1999, and then dropped to No. 6 in 2005. Now it is facing a great challenger - Shanghai’s Yangshan port which opened its facility in December 2005, adding 2.2 million TEU of container-handling capacity to what was already the world’s third-largest container port. When fully completed in 2020, Yangshan port will add 15-20 million TEU to Shanghai’s total container-handling capacity. With an average depth of 15 meters at its 50 planned berths, Yangshan port complex should easily handle the next generation of 8,000-10,000 TEU container ships that will be sailing in 2006-2007.

5. Asian economic growth rate forecast

You will see from this list (taken from reliable sources) that Taiwan is way behind all of its Asian neighboring countries.

Taiwan has recently lowered its 2006 economic growth rate to 4.28% from 4.31% to reflect steep decline in domestic personal spending as many credit- and cash-card issuers have tightened lending since the second half of 2005. In contrast, China painted a rosy picture in its economic growth rate – 10.2% for first-quarter 2006 and 11.3% for second-quarter 2006.

6. Taiwan’s global competitiveness drop

According to recently-released Global Competitiveness Survey by Switzerland-based Institute for Management and Development, Taiwan’s global competitiveness rating has dropped to 18 in 2006 from 11 in 2005 whereas and China has jumped from 31 to 19, making it neck and neck with Taiwan.

This drop in ranking should be a timely warning to Taiwan, whose economy has been plagued by domestic scandals that have eroded the confidence of business sector in Taiwan. It is expected that China will overtake Taiwan next year in global competitiveness if Taiwan keeps placing political issues ahead of economic development.

7. Profit earned from banks’ offshore branches

From 2003 to 2005, 13 Taiwan bank branches in Hong Kong posted a pre-tax profit of US$1.37 billion. Their total 2006 first-quarter profit already reached US$4.34 million. On the other hand, from January to October 2005, 5 Taiwan bank branches in Vietnam posted a total pre-tax profit of US$1.68 billion. However, profit in these markets will be squeezed in the years to come as more and more global banking giants and local banks are catching up fast.

8. Foreign direct investment (FDI) and domestic investment in 2005

Foreign direct investment (FDI) in Taiwan totaled US$44.23 billion in 2005. However, most of these funds were channeled into Taiwan stock market, contributing to 51% of its foreign-currency reserves and posing a challenge in stabilizing the exchange rate.

In contrast, Taiwan resident investment in foreign securities in 2005 amounted to a record-high of US$35.8 billion. To make matters worse, US$22.456 billion was invested in foreign securities by Taiwan residents in the first half of 2006. Under current laws, residents’ income from abroad is not subject to income tax in Taiwan, which may have prompted the outflow of private funds. On the other hand, Taiwan’s domestic investment posted NT$880 billion in 2000 and dropped to NT$530 billion in 2005, reflecting that Taiwan’s investment environment does not justify their stakes.

Taiwan’s statistics indicate that in the past seven months of 2006, estimated domestic spending of 2.5% has dropped to 1.7% while estimated domestic investment of 3.6% has dropped to 0.5%.

Despite this, there are also foreign institutional investors looking for good buys or targets, especially the banking sectors. Singaporean financial giant Temasek Holdings has proposed to invest US$400 million through its Asia Financial Holdings (AFH) to take a 15% stake in E. Sun Financial Holding. AFH will share its know-how regarding corporate governance, corporate financing and risk management, and E. Sun will use the funds to boost its lending services and capital adequacy.

9. Taiwan stock market volume

It stood within world top 10 before 2004, and now dropped to 15, implying a lack of confidence from investors, both local and foreign, and a drop in foreign direct investment. There are already 43 Taiwan companies listed in Hong Kong stock market, and it is expected that a total of 55 Taiwan companies will be listed there in 2007. On 10 August 2006, the date the new chairman of Taiwan Stock Exchange took office, there were about 50 Taiwanese companies planning to have their companies listed in foreign stock markets, such as Hong Kong or Singapore, while there is not even one Taiwanese company planning to be listed in Taiwan.

10. Syndication loans

Due to huge idle funds held by banks, spread of domestic syndication loans are so thin that banks are reluctant to join or unwilling to commit their funds in this fiercely competitive market. Global financial giants, such as Citigroup, HSBC, Standard Chartered and ABN AMRO, have already withdrawn from this loan market, following with some major local banks.

11. McKisey & Co. view

In the Global Views (1 May 2006), McKisey pessimistically predicted that about 24 local banks may go bankrupt as outstanding unsecured loans reached NT$1.3 trillion. Outstanding loans from credit cards and cash cards are NT$780 billion (not including unsecured consumer loans of NT$500 billion), and banks have suffered a 10% loss, amounting to NT$78 billion.

12. Economist Intelligence Unit survey

In early August 2006, the Economist Intelligence Unit’s Hong Kong-based Asia-Pacific research department published a survey predicting that Taiwan’s economic growth rate for the next 15 years would remain at a low average 3% per year. It further added that it saw no future for Taiwan’s financial sector because Taiwan has chosen to isolate itself, hurting its economic development and banking business expansion.

13. Top 1000 World Banks (The Banker, July 2006)

Among top 10 banks of ‘Worst Profit Performance’, four Taiwan banks posted great loss in 2005:

Chang Hwa Commercial Bank (US$1.459 billion, ranked No.1)

Taiwan Business Bank (US$218 million, ranked No.3)

Taishin Bank (US$187 million, ranked No.6)

Jih Sun International Bank (US$170 million, ranked No.7)

However, among banks of ‘Top 25 Disclosed BIS Ratio (%)’ two Taiwan banks far outperformed their rivals – Chinatrust Financial Holding ranked No.1 with 119.72% while Hun Nana Financial Holdings ranked No.3 with 109.38%. This reflects sharply in these two respects.

14. China’s Taiwan’s entry to WTO

Despite Taiwan’s great successful efforts made in getting into the World Trade Organization (WTO), it has not done very much to fulfil its WTO’s entry commitments ever since its entry. In contrast, China has done quite a lot in this respect. For this, the article ‘WTO: Year Five’ (written by Michael Overmyer) in the January –February 2006 issue of The China Business Review is worth reading.

Some of China’s WTO’s entry commitments were fulfilled in 2005 and some outstanding commitments are still under way. It is expected that these outstanding commitments will be fulfilled by 11 December 2006 or in early 2007. Ironically speaking, China has approved 7 Taiwan banks to set up their representative offices in China, but Taiwan still does not approve any China banks to set up a representative office in Taiwan. This is completely against WTO’s entry agreement. No Taiwan bank branch can be established in China until joint supervision terms are reached between China and Taiwan. This is a political issue rather than a banking issue.

15. Free Trade Agreement (FTA) not seen

Faced with challenges from BRICs (Brazil, Russia, India and China) and the Next Eleven (short for N-11) as well as ASEAN member countries, Taiwan should exert great efforts to negotiate a free trade agreement FTA) with each of those countries, especially with BRICs, Singapore, Japan, South Korea and the US.

The U.S. has warned that it will not negotiate a FTA with Taiwan unless Taiwan opens its ‘three direct transport links’ with China, Taiwan’s biggest export market. The U.S. business cycles are also not interested in a free trade agreement with Taiwan because Taiwan cannot help expand their economic interests in China, despite its cultural, language and geographical advantages with China.

Japan and Singapore have also refused talks with Taiwan on the same subject as they do not need a ‘Taiwan bridge’ to expand their economic and trade ties with China. This will undoubtedly block Taiwan’s access to the resources and markets of the ASEAN and the ASEAN plus Three.

ASEAN expects foreign investment to keep growing after it surged 48% last year to a new record, but the region must redouble efforts to catch up with China. Foreign direct investment (FDI) into the 10-member ASEAN rose to US$38 billion last year, surpassing level last seen before the 1997-1998 Asian financial crises. In the first quarter of 2006, FDI into ASEAN soared 90% from the same period last year to US$14 billion and will be on the upward trend.

16. Taiwan’s government policies

The first controversial “Go Slow, Be Patient” policy (which marks its 10th anniversary, starting from 1996 to this summer of 2006) was designed to restrict Taiwan’s investment in China and it has proved most effective in slowing down Taiwan’s economic growth. China and Hong Kong are Taiwan’s largest export markets, with Taiwan enjoying a trade surplus of US$49.79 billon in 2005. By some unofficial estimates, China has attracted US$100 billion of investments from Taiwan over the past two decades.

Given this policy adopted in the past 10 years, Taiwan has exhausted itself in political struggles between pro-independence and anti-independence political blocs, leaving the economy going downhill all along. It has become clear to everyone that the “Go Slow, Be Patient” policy is the root cause of Taiwan’s economic woes. Taiwan, a front-runner of Asia’s Four Dragons 10 years ago, is now trailing far behind the other three, thanks to its own self-inflicted policy.

To make matters worse, the second “Active Management, Effective Opening” policy adopted in early 2005 is considered meaningless and destructive with too many ifs and buts, leading to no support from businesses and banking sector. Despite putting this policy into effect, trade surplus with China and Taiwan’s investment in China are still on the rise.

Taiwan’s Latest News

The two-day (27-28 July 2006) ‘Conference on Sustaining Taiwan’s Economic Development’, hundreds of proposals was being made. They are, however, categorized into ‘common opinions’ proposals and ‘other opinions’ proposals.

The ‘common opinions’ proposals refer to those which will be implemented in the near future while ‘other opinions’ proposals have been shelved for future discussion and further studies with an unknown schedule.

Common-opinions proposals cover:

• To relax curbs on semiconductor technology exports to China and on visit by mainland nationals
• To loosen the semiconductor curbs on allowing Taiwanese chipmakers to use in the mainland plants, a mature technology those local competitors already possess
• To liberalize cross-strait cargo and passenger charter flights
• To relax restrictions on banking and insurance to China

Other-opinions proposals cover:

• To lift the 40% ceiling on China investment by Taiwan’s companies
• To allow banks to set up branches and subsidiaries in China
• To allow banks to invest in Chinese financial institutions
• To extend the grace period for imposing a 10% tax on retained earnings

The American Chamber of Commerce in Taipei (AmCham) and the European Chamber of Commerce in Taipei (ECCT) have recently warned that restrictions on visit from Chinese business travelers and a lack of direct flights could force multinational companies to set up their greater China operations elsewhere, thus pushing Taiwan towards economic marginalization.

According to data from the Financial Supervisory Commission (FSC), local banks saw profits shrink by over 50% in the first half of 2006 compared to a year ago on mounting defaulted consumer loans. Pre-tax income of 44 lenders totaled NT$36 billion in the same period, down 57% from NT$839 billion a year earlier.

A late starter but a winner – Chinatrust Commercial Bank

Chinatrust Commercial Bank has been awarded with ‘best domestic bank’ in Taiwan by Asiamoney magazine for several years. It was founded in 1966 as China Trust Company and was changed to Chinatrust Commercial Bank after 2001 (the year 15 private banks were established). It is now the largest private bank in Taiwan, in terms of both equity and total assets. It is the leading financial institution in loan syndication, bond underwriting, credit card, and wealth management in Taiwan’s financial market.

With 111 branches in Taiwan and 61 overseas offices located in 14 countries, it is well positioned to provide a comprehensive range of financial products and services to fulfil its customers’ business demands.

Faced with global competition and a rapidly changing market and in order to match with customers’ business needs, it continues to build its product leadership with innovative solutions to fulfil its customers’ domestic and international expansion. It stands ready to play the role of a regional bank in the very near future.

Conclusion

Opportunity does not favor those who hesitate and wait, but Taiwan is still taking the start-and-stop and wait-and-see approach to dealing with its banking business which is supposed to be globalized rather than localized.

As the iceberg caused the disaster of ‘unsinkable’ Tinanic on 14 April 1912, Taiwan’s isolated policies are the iceberg of its banking business. It is like running in a long tunnel without seeing a ray of light at the end of the tunnel. Taiwan should move horizontally instead of vertically – meaning that it should ‘connect’ and ‘collaborate’ with other countries, especially China, in banking business. By using words of Thomas L. Friedman in his book The World is Flat, Taiwan should try its best to ‘flatten’ with China quickly and effectively in all respects to take advantage of present circumstances which are still beneficial to both sides. If not, Taiwan may really fall ‘flat’ soon, with its debt-saddled banking business sinking fast not in the North Atlantic Ocean but in its own onshore quick sand.

If two men (China and Taiwan) ride on a horse, one must ride behind. As long as the horse runs fast and reaches the finish line first, who cares who is riding behind!

To Read More to Know More

   September 20, 2004

Taiwan's banking system has two big problems: too many banks, and loan policies that have traditionally lavished financing on government-backed projects, many of which were bad credit risks.

*****

The McKinsey Quarterly

Taiwan’s Banking Glut

Although Taiwan boasts Asia's fourth-largest financial-services market by revenues, many lenders lose money because the retail-banking market is oversaturated.

****

Asiaweek.com magazine, October 20, 2000

Taiwan's Ticking Clock

Why the island is worried about its banks

By ASSIF SHAMEEN

****

August 18, 2001

Taiwan's banks: chickens come home to roost

By Laurence Eyton

TAIPEI - Like a scene from The Untouchables, 200 government agents barged into Taiwan banks last week in the first real attempt to make an impact on the island's festering financial weaknesses.

[back to Alan's Reminiscences & Reflections]