Ontario SITC loses two funds to Cathay SITC
27 January 2014
News, Asia, Taiwan
By Hui Ching-hoo
Taiwan’s Cathay Securities Investment Trust Co (Cathay SITC) is to take control of NT$240 million (US$800 million) worth of assets from two Ontario Securities Investment Trust Co (Ontario SITC) mutual funds, according to a report from Commercial Times.
The move follows on from Taiwan’s Financial Supervisory Commission (FSC) revoking Ontario SITC’s license on January 21 due to it failing to fulfil the necessary shareholder obligations.
The regulations stipulate that an individual asset management entity should be at least 20% owned by professional shareholders such as banks, insurers, securities brokerages or foreign counterparts.
Following Sunny Bank offloading its stake in the asset manager in 2011, Ontario SITC has struggled to find new shareholders to meet with the regulatory requirements.
The regulator’s decision has triggered redemptions of NT$260 million in both the company’s Ontario Money Market Fund and its Ontario High Tech Fund.
The FSC decided to allocate the remaining NT$240 million worth of fund assets to another asset manager, and Cathay SITC came up trumps to manage them.
Cathay SITC President Andy Cheng told local media that the company has plenty of experience managing the assets of ailing companies and hopes to complete the transaction within a short period of time to protect investors’ interests.
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