| As a vehicle of financial multi-operation, financial holding companies (hereinafter referred to as FHC) have been flourishing in China for years. With regard to FHC, the academic circle tends to over-estimate its advantages while under-estimate its disadvantages. As a matter of fact, it is unlikely that FHC in our country could show its merits as normal, but it is possible that its defects could become more evident. The reasons for that lie in the problems faced FHC in China, including the ambiguous concept, the unclear position, the lack of market access measures and the vacuum of regulations. Based on the reality of our country, this paper counts on information exposure (hereinafter referred to as IE) to boost FHC towards a healthy development. IE could prevent the special risks of FHC from taking place. Moreover, it could pave the way for the measures of market access of FHC. Therefore, this paper tries to build up a framework regarding the basic IE contents concerning FHC.The paper comprises five parts:Part 1 is the summary of FHC. The writer analyses its concept, advantages, general classification and specific classification in our country. The writer supposes that FHC is one type of financial conglomerates, and it should be the choice of our country to carry out diverse undertakings (multi-operation). There are two kinds of FHC, the pure FHC and the mixed FHC. As for the various quasi-FHC that have already emerged in China, classification hereunder is made according to the subject who proposed the establishment of the quasi-FHC.In Part 2 the writer establishes the connection between FHC and IE. Following general-to-specific methodology, the paper concludes the general effect of IE on financial industry, the specific effect of IE on FHC and the realistic effect of IE on Chinese FHC. From the analysis above, the centered viewpoint is concluded, which is as follows: IE is extremely important for the development of Chinese FHC. IE does not only realize market discipline, but also caution against special risks (which include the opacity of organization, the opacity of capitalization, the opacity of corporate governance). Moreover, IE could pave the way for market access measures. Part 2 is the center of this paper. Concerned about the three types of special risks of FHC, the writer set up the framework of the contents of IE regarding FHC on three main aspects, which include organization, capitalization and corporate governance, so as to pave the way for market access.Part 3 is the IE of FHC on the organization. This paper maintains that Chinese FHC does not hold the position of headquarter in the conglomerate, as shown by its goal of establishment, its powers and functions as well as its formation approach. Therefore, for the purpose of clarifying and simplifying the organization, simply exposing the shareholders of FHC and the controlled institutions is far from sufficient. The writer argues that IE should be deepened, which means the member companies, the operation of member companies, the shareholders of member companies and the cross-holding situation should be uncovered.Part 4 is the IE of FHC on the capitalization. In principle, FHC should be supervised through consolidated accounts. With its accounts being consolidated, FHC should reveal the information relating to the capitalization so as to enable supervisors and markets to assess the capital adequacy of the FHC as a whole. As is demonstrated in this paper, three main aspects of IE on capitalization are the financing and investing, the outcome of consolidated accounts and the handling of controlled non-financial institutions.Part 5 is the IE of FHC on the corporate governance. With reference to Corporate Governance Best-Practice Principles for Financial Holding Company, issued by Taiwan Security Exchange in 2003 and various documents issued by Basel Committee, this paper seeks to incorporate three main aspects of IE on corporate governance, including the condition of corporate organs, inter-group transaction and internal control. |
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