Chinese mainland bank sets up 1st representative office in Taiwan
A BOCOM spokesperson said the move would help strengthen information exchanges between financial institutions and consumers across the Taiwan Strait, pushing forward economic and financial cooperation.
The announcement came one day after the applications of BOCOM and Bank of China (BOC) to set up representative offices in Taiwan were approved by Taiwan's top financial regulator on Thursday.
The Financial Supervisory Commission (FSC) said the two banks from the Chinese mainland would be first authorized for non-profit business activities such as "liaising with banks and consumers and collecting financial market information in Taiwan" for a year before being able to apply to set up branches.
In June, the Chinese mainland and Taiwan signed a landmark free trade deal, the Economic Cooperation Framework Agreement (ECFA), slashing tariffs on the island's exports and laying the foundation for banks on both sides to invest across the strait.
Under the agreement, banks from Taiwan can apply to do RMB business on the mainland after at least two years of operation and if they show a profit in the previous year.
Banks from the Chinese mainland can establish representative offices in Taiwan and then upgrade to branches after one year.
In a sign of warming economic ties between the two sides, the Chinese mainland earlier this month approved applications by four Taiwanese banks to upgrade their mainland representative offices to branches.
The four banks are Land Bank of Taiwan, Chang Hwa Commercial Bank, First Commercial Bank and Taiwan Cooperative Bank.
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