Fubon obtains two seats on board of UWCCB, heightens merger prospects...05.23.2001-Primasia News-Taiwan

Primasia News, Taiwan

05.23.2001
Fubon obtains two seats on board of UWCCB, heightens merger prospects

As expected, Fubon Group was awarded two seats on the board of UWCCB (2826 'Shi Hua Yin') and Lin Yuan Group one seat at the bank's Annual General Meeting yesterday. Fubon is the largest shareholder in UWCCB with a 8.3% stake. We believe board representation will pave the way for UWCCB to become a financial holding company through a possible future merger with Fubon.
China Development and Industrial Bank (CDIB, 2804 'Kai Fa') has also indicated the market share and asset quality of UWCCB complements CDIB's financial holding company. CDIB has not ruled out the possibility of wooing UWCCB to join forces within its own financial holding structure. Interest from foreign banks may also be forthcoming.
VB Primasia Investment Opinion: As a major shareholder, we believe Fubon Group will be able to further its influence in UWCCB with two seats on the board. However, the question of whether the 'dream merger' of UWCCB, International Commercial Bank of China (ICBC, 2806 'Zhong Yin') and Chiao Tung (2824 'Jiao Yin') will actually come about is a lingering concern. ICBC's chairman has said details will be forthcoming in June. We recommend BUY UWCCB.