08.13.2001
RTC assumes problematic financial institutions

• Development: Resolution Trust Company’s (RTC) takeover of 36 community level financial institutions will begin its first working day of operations today. RTC plans to set aside between NT$50-60bn to accommodate losses among battered institutions. However, total losses will require more detailed analysis.

• Analysis: An area of investor concern should be whether the eight government-linked banks will suffer losses if they are required to takeover the 36 institutions.

• Primasia View: Details of the takeover are yet to be announced. We expect the impact on the finance industry to be minor.