State-owned Enterprises

Under the “Law of National Business”, the national businesses included both businesses owned by the government completely or jointly owned by the government and civilian.

The Ministry of Finance in fact managed the national business in different historical periods. Those businesses included banks, insurances, financial services and tobacco & Wine. Usually, the national banks were always the largest enterprise owned by the government.

On February of 1912, the Imperial Bank of China in Shanghai was renamed the Bank of China. By 1915, the Tientsin Mint was created in order to produce silver dollars.

After the establishment of the National Government, T. V. Soong became the Governor of the Central Bank while he was still the Minister of Finance. With this reason, the Central Bank became the national bank of China.

When China was finally united after the North Expedition, the Government considered the Central Bank as the national bank, Bank of China as international currency exchange bank, Chiao Tung Bank as the corporate bank and Farmer Banks of China as bank to provide supports and aids to the economy of rural areas.

With the support of the government, those four major banks of China could issue banknotes. Meanwhile, the Ministry of Finance also created the China Development Finance Corporation to improve the business between China and foreign nations with the money support provided by the government.

In 1935, the Central Trust of China was founded under the leadership of Ministry of Finance H. H. Kung. Beyond its secret mission of purchasing weapons from the foreign nations, it also dealt with business related to insurance and trust.

When the Second Sino-Japanese started, the Chinese Nationalist issued “The Integrity Act of Financial Institutions of the Central Government” on September 8th 1939. It ordered the Central Bank, Bank of China, Chiao Tung Bank and Farmer Bank of China to establish a joint office, which called the “Office of Four Banks”. This new organization was also in charge of the businesses from the Central Trust of China and the Directorate General of the Postal Remittances & Savings Bank under the Ministry of Transportation and Communication. In 1943, the Ministry of Finance added more official stocks into the Four Major Banks of China, and the position of the government officials in the board of director definitely rose up.

In 1928, the Ministry of Finance founded the Shanghai Mint in order to produce the currency of the Central Government. In the same year, the Hangchow Mint was also founded. By 1941, the Ministry of Finance authorized the Central Trust of China to establish the Central Trust Print and Central Paper Mill to produce paper money. Later on, both organizations were put under the Central Bank of China.

After the restoration of Taiwan in 1945, the Taiwan Provincial Administrative Office took over the businesses owned by the Japanese colonial government. Those businesses included the Bank of Taiwan, the First Bank of Taiwan, the Chang Hwa Bank, Hua Nan Commercial Bank, Land Bank of Taiwan, Cooperative Bank of Taiwan and Taiwan Business Bank. After the Taiwan Provincial Administrative Office became the Taiwan Provincial Government, all the organizations above were put under its charge.

When the Central Government retreated to Taiwan in 1949, only the Central Trust of China withdrew to Taiwan completely. The Central Bank, Bank of China, Chiao Tung Bank and Farmer Bank of China lost most of their properties, and only few oversea branches were still working. Until 1960, the Central Bank and the Bank of China were reestablished, and then the Farmer Bank of China in 1967.

When the Republic of China was expelled from the United Nations in 1971, the Bank of China was renamed International Commercial Bank of China in order to avoid the controversy on its oversea properties. At the same point, the International Commercial Bank of China was also run by the civilian. In 1972, the Chung Kuo Insurance Company was also established in order to merge the national businesses of Taiwan under the system of the Ministry of Finance. In dealing with the reinsurance business, the Central Reinsurance Corp was founded in 1968.

By January of 1979, the Export-Import Bank of ROC was formed in order to support the private enterprises to gain favorable export finance. On September of 1985, the Central Deposit Insurance Corporation was founded in order to stabilize the order of finance, and also to protect the right of depositor.

In 1988, the Financial Information Service Center was created to promote the informationization of the financial and custom issues. In 1988, it was renamed Financial Information Service. The Ministry of Finance started a cargo clearance automation planning and promotion (CCAPP) task force on November 9 1990. By doing this, Taiwan adopted its first automation cargo system, and the first national Electronic Data Interchange network. Eventually, the Trade-Van Information Service Co. was founded in 1996 with the supports of both government and civilian shareholders.

On December, 1998, because of a simplification policy of Taiwan Provincial Government, all the banks and businesses under it were turned over to the Central Government. The Taiwan Tobacco & Wine Monopoly Bureau was renamed Taiwan Tobacco & Liquor Corporation on July of 2002. Taiwan Development Corporation was also privatization. The Ministry of Finance still held the stocks of both organizations above and attending their board of directors. The Printing Plant of Taiwan Provincial Government was also then subordinated and renamed as Printing Plant, Ministry of Finance.

By 2002, the Chiao Tung Bank, International Commercial Bank of China, and Chung Kuo Insurance Company were all renamed and put under the Mega Financial Holding Company, In 2006, the Taiwan Cooperative Bank and Farmer Bank of China were combined and renamed Taiwan Cooperative Bank Corporation. On July 1st, 2007, the Central Trust of China was merged into the Bank of Taiwan. By January 1st, 2008, the Bank of Taiwan, Land Bank of Taiwan and Export-Import Bank of ROC together formed the Taiwan Financial Holding Companies. To unify the business operation and administration right so as to implement financial amangerial policies firmly, beginning from Januany 1st , 2011, the shareholder’s rights of CDIC under the MOF was transferred to the Finanical Supervisory Commission, according to the Approval Order of the Executive Yuan on August 17th, 2010.

Until January of 2011, the businesses held by the Ministry of Finance included Taiwan Financial Holding Companies, Bank of Taiwan Corporation, Taiwan Land Bank Corporation, Export-Import Bank of ROC, First Financial Holding Corporation, First Commercial Bank, Hua Nan Financial Holdings, Hua Nan Commercial Bank, Cooperative Bank, Business Bank, Chang Hwa Bank, Central Reinsurance Corporation, Financial Information Corporation, Taiwan Tobacco & Liquor Corporation, and Trade-Van Information Service Corporation.

Management of Government Shareholdings

(1) The Organization

According to the resolution of The 8th Meeting of The Finance and Economics Meeting of Executive Yuan on 28th December, 2004, central government shareholdings were to be managed together by the Ministry of Finance stage by stage as of 1st March, 2005, whereupon the Ministry of Finance established "The Guidelines for the Establishment of the Unit for the Management of Government Shareholdings, Ministry of Finance”, and the guidelines were approved by the Executive Yuan on 31st January, 2005. The first stage was that all the government’s shareholdings including the subsidiaries of the Ministry of Finance, government-affiliated financial institutions and companies invested in by the institutions, and other subsidiaries administered by other Ministries and their re-invested companies were managed together by the Unit for the Management of Government Shareholdings, Ministry of Finance.

Later, based on the phased policy of the joint management of government’s shareholdings, there were some adjustments requested by the Executive Yuan, including the revision of “The Guidelines of the Management and the Disposal of Government Shareholdings” brought into effect on 31st October, 2006, and the Unit for the Management of Government Shareholdings, Ministry of Finance was originally established by the joint staff of the 2nd Division of the National Treasury Agency. However, later, in order to be in accord with the handling of the managerial affairs of government shareholdings of government affiliated financial institutions and companies invested in by the institutions, the management of all the relevant business returned to the staff of the 2nd Division of the National Treasury Agency, and, "The Guidelines for the Establishment of the Unit for the Management of Government Shareholdings, Ministry of Finance” were suspended on 8th October 2008 by the approval of the Executive Yuan.

In order to strengthen the management of government shareholdings, the Executive Yuan approved the " Guidelines for the Establishment of the Unit for the Management and Supervision of Government Shareholdings” on November 27, 2009. The Government Shareholding Management and Supervisory Unit under the Executive Yuan came into active operation on the same day. The unit is constituted as an ad hoc task force. The Vice-Premier is the convener, and the Secretary-General of the Executive Yuan is the deputy convener. The Minister of Finance and the deputy heads of other relevant ministries of the Executive Yuan, such as the Ministry of Economic Affairs, are the panel members. The Deputy Minister of Finance is appointed to be the Executive Secretary which position is held as a concurrent post, and the National Treasury Agency of the MOF provides the staffing for the unit.

(2) The Establishment of “The Regulation of the Taiwan Financial Holding Company”

The Taiwan Financial Holding Company （hereafter referred to as “the Holding Company”）is positioned as the National Financial Holding Company, its set up followed “the Financial Holding Company Act” and “The Corporation Act” and relevant legal regulations, but considering that the position of a national financial institution held 100％ by the government, it will be more appropriate to establish an organizational regulation for the setting up of the company. In order to fulfill the legal procedure of the set up of the Holding Company, “The Regulations of the Taiwan Financial Holding Company” was established. The Regulations went through their entire three readings in the 8th Meeting of the 2nd Conference of the 7th Session of the Legislative Yuan on 7th November 2008, and were announced by the Order of Hua-tzong-Yi-Yi-Tsu 09700249041 of the President.

(3) The Secession of the Landbank of Taiwan and the Export-Import Bank of the ROC. from the Taiwan Financial Holding Company

The MOF, following the original plan, established The Taiwan Financial Holding Company （hereafter referred to as “the Holding Company”）on 1st January 2008, the Holding Company includes 5 sub-companies, the Bank of Taiwan, the Land Bank of Taiwan, and the Export-Import Bank of the ROC, the Banktaiwan Life Insurance and the Banktaiwan Securities. However, in order to follow the subsidiary resolution made in the 8th Meeting of the 2nd Conference of the 7th Session of the Legislative Yuan on 7th November 2008 that the Landbank of Taiwan and the Export-Import Bank of the ROC withdraw from the Taiwan Financial Holding Company, the MOF completed the executive procedure of the sucession on 20th December 2008.