The HSBC has been named the successful bidder in a government auction to acquire The Chinese Bank in Taiwan. The acquisition will increase HSBC’s island-wide branch network from eight to 47, giving it a presence in all the major cities in Asia’s fourth biggest banking market.

The Taiwan Government’s Central Deposit Insurance Corporation (CDIC) took control of The Chinese Bank in January 2007. As at 30 September 2007, gross assets were NT$100.16 billion (approximately US$3,097 million).

The Chinese Bank has 36 branches and over one million customers throughout Taiwan. It provides a full range of services to retail customers as well as small-to-medium size enterprises and large corporates. Under the terms of the transaction, HSBC will also be able to convert three business offices of The Chinese Bank into new branches.

The transaction is subject to obtaining the necessary regulatory approvals. In accordance with the terms of the transaction, HSBC is required to establish a local subsidiary within three years of completion or one year after HSBC’s total assets in Taiwan exceed NT$450 billion (approximately US$13.9 billion), whichever is earlier. The new company will have a minimum capitalisation of NT$10 billion (approximately US$309 million).

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