The China Post news staff
TAIPEI, Taiwan — Chairman Chen Yu-chang of the Cabinet-level Financial Supervisory Commission (FSC) said yesterday that allowing Nan Shan Life Insurance to be publicly traded on the local bourse as a special listing case is one of the possible ways to settle the financial problems of the company. Chen said that the FSC did send such a proposal to the American International Group (AIG), parent of Nan Shan, but AIG turned down the offer.
Chen made the remarks at the Finance Committee meeting of the Legislative Yuan when asked by lawmakers how to safeguard the interests of the clients of Nan Shan Life Insurance.
At the meeting, Lawmaker Alex Fai and Ong Chong-chun of the ruling Kuomintang noted that the aggregate assets of Taiwan’s life insurance industry are estimated at NT$11 trillion, with Nan Shan commanding NT$1.7 trillion of the total, thus gaining a solid presence in the local life insurance industry.
The lawmakers continued that Nan Shan suffered total operating loss of over NT$10 billion in the first three quarters of the year, making it not eligible for being listed on the local bourse. One of the criteria governing the listing of a firm’s shares on the local bourse is the firm should enjoy profitable operations two years before its listing.
Accordingly, Nan Shan can hardly be allowed to become listed on the local bourse, but the FSC can consider carrying out a special listing case for Nan Shan to secure its sustainable operation and raise funds to settle its financial problems. In response, FSC’s Chen said that his commission did study the feasibility of the special listing case for Nan Shan, and has talked with AIG officials several times,
“But so far, AIG has failed to give us any positive response. We cannot force the U.S. firm to accept our proposal, and we cannot prohibit them from selling Nan Shan to any business conglomerate,” Chen continued.
But if the AIG wants to sell Nan Shan on an open bidding basis, the firm should follow principles set by the FSC, otherwise any consequent acquisition deal won’t be accepted by the FSC, Chen added.