08.22.2001
First Commercial eyeing Bank of Kaohsiung

• Development:: The major shareholder of Bank of Kaohsiung (2836), Kaohsiung City Gov’t, plans to release 22.5% (100m shares) of the bank. The City Gov’t will be left with a controlling 23%. First Commercial Bank (2802) has shown strong interest in the bank.

• Analysis: As First Commercial has previously approached the bank for possible merger, it may be a potential buyer of the shares. First Commercial is setting up a Financial Holding Company and is still eyeing M&A candidates.

• Primasia View: A major concern for First Commercial is its poor asset quality, which we believe cannot be improved solely by acquiring other banks.