1. Foreword
The CDICwas established according to
the Deposit Insurance Act
(hereinafter
referred to as "the Act") promulgated by the President on January 9, 1985.
Article 2 of theAct empowered theMinistry of Finance (MOF) as the competent
authority. TheFinancial SupervisoryCommission (FSC) was establishedon July 1,
2004.At that time, theCDICwasmade subordinate to theFSC.
The original shareholders of the CDIC at the time of its establishment were the
MOF, Central Bank, Bank of Communications, International Commercial Bank
of China, Farmers Bank of China, UnitedWorld Chinese Commercial Bank, and
Shanghai Commercial Bank. Some of the shareholders subsequently merged,
leaving theMOF, Central Bank, Mega Bank, Taiwan Cooperative Bank, Cathay
United Bank and Shanghai Commercial Bank as the remaining shareholders
by the end of 2006. On January 1, 2011, CDIC shares held by the MOF were
transferred to the FSC. The FSC subsequently purchased the CDIC shares held
by the four private shareholders-Mega Bank, Taiwan Cooperative Bank, Cathay
UnitedBankandShanghai Commercial Bank.As a result, theCDICbecamea fully
government-owned, state-run institution on August 15, 2014, with the Central
Bankand theFSCas its sole shareholders.
This commemorative edition was published tomark the 30th anniversary of the
CDIC this year. It reviews the hardships facedby theCDIC in its pioneeringwork
to stabilize the financial environment, aswell as looks ahead to the corporation's
ongoingmission to further improve thedeposit insurance system.
2. Periodof VoluntaryParticipation
(Sept. 1985~Dec. 1998)
(1) Background
Before 1981, the government adopted layers of controls and safeguards to
ensure the stable and smooth operation of domestic financial institutions.
However, rapid changes in the local and international financial environments
led to deregulation of the financial sector, giving the industrymore operational
freedom. It also intensified competition and increased operational risks. In
view of the far-reaching impact a failed financial institution could have on the
economy, the government devised a deposit insurance system to safeguard the
rights of small depositors in line with Article 46 of the former
BankingAct
. This
was widely supported by the industry, academia and experts. In 1983, theMOF
and theCentral Bank together with financial industry experts drafted the
Deposit
ReviewandOutlook
19
