| dc.description.abstract | In the 1990s, Taiwan commenced to implement the financial liberalization, however, the effective supervision was insufficient. Based on the high amount of private banks approved for establishment and the vicious competition, the over-banking problem was caused.Moreover, due to the global financial crisis, this phenomenon has not only appeared inTaiwan, but also expanded to Northeast Asia, Europe, and even the United States. The people in neighbors in Northeast Asia have also demand the financial reforms at this time.Considering that Northeast Asia and Taiwan are affected by the impact of the global economy, the author will first discuss the financial reform process in neighboring countries in Northeast Asia, then return to review the Taiwan′s financial reform.
After the first and second financial reform, Taiwan originally expected to achieve the economies of scale through “mergers and acquisitions”, nevertheless, it could not completely achieve the purpose of financial reform and had many drawbacks. Taiwan’s second financial
reform aims to reduce the number of financial holding companies, whereas the M&A policy has made banks afraid of being acquired, which do not follow the market mechanism. The high financial leverage used by the company would lead to the “Extreme Leverage Buyout”
phenomenon. One of the most famous case is the Taishin International Bank of mega Changhua Bank, which looks like being a David and Goliath contest. Another case is the hostile takeover between Mega F.H.C. and Chinatrust F.H.C.
Since then, the government turned a conservative attitude towards ＂financial reform＂and kept avoiding this sensitive issue as much as possible. However, the global mergers and acquisitions become a trend, while the financial industry is also one of them. To avoid the complete disappearance of China′s financial institutions in the global financial market, we must face up to the ＂M&A＂ to enhance the competitiveness of the financial industry. The mergers and acquisitions should not be limited to the consensual acquisitions, on the contrary,
it should be actively extended to the hostile takeover.
In November 2018, the “Regulations Governing the Investing Activities of a Financial Holding Company” was officially amended. With this amendment, the hostile mergers and acquisitions of financial holding company are opened under certain conditions. The two major questions proposed by the author are: (1) will the opening of the hostile mergers which directly exclude the pan-public financial institutions result in the lack of competition?
Furthermore, (2) is it appropriate to set certain conditions for hostile mergers and acquisitions after the pass of the policy?
This thesis will discuss the two major issues in detail. Since the specificity of financial industry, it should be appropriate to make the corresponding regulation. Finally, this thesis will propose the recommendations on Taiwan′s inadequacies of hostile takeover in the financial industry referring to the legislative process of the US financial regulations. | en_US |