Taiwan auctions failed Chinfon Bank to local lenders

TAIPEI, Oct 27 - The Taiwan government said on Tuesday that it has auctioned the failed Chinfon Commercial Bank to Fubon Financial <2881.TW> and three other local lenders, in the latest consolidation move in the fragmented banking industry.

The government will pay T$19.3 billion to Yuanta Financial <2885.TW> and T$19 billion to Far Eastern Bank <2845.TW> to take over Chinfon's local assets and debts, said an official of the Central Deposit Insurance Corp.

Under the acquisition, however, Fubon will pay the government T$2.53 billion to buy Chinfon's branches in Vietnam, and Taishin Financial <2887.TW> will pay T$4.1 billion to acquire Chinfon's credit card business, the official said.

The island's banking market, the fourth biggest in Asia, has undergone consolidation in recent years, partly via government auctions of small money-losing lenders.

HSBC Holdings <0005.HK> <HSBA.L> and DBS <DBSM.SI> are among global names that have acquired Taiwanese banks.