Taiwan's Chinatrust plans to set up unit in China

TAIPEI, May 7 (Reuters) - Chinatrust Financial 2891.TW, Taiwan's biggest credit card issuer, on Thursday said it planned to set up a subsidiary in China when Taiwan allows such investment, in the latest sign of easing ties on both sides.

Trade between China and Taiwan has loosened in general, though most forms of investment in China are currently closed to Taiwan’s financial institutions, such as Chinatrust, partly because of political differences.

China sees self-ruled, democratic Taiwan as its own, though the island has set some restrictions on investments to avoid over-reliance on the mainland.

“If Taiwan regulators permit the establishment of subsidiaries or branches, we will act immediately,” Chinatrust Chief Investment Officer Daniel Wu told reporters.

But relations between the two have improved significantly under a year-old China-friendly administration led by President Ma Ying-jeou, leading both sides to pledge to open up many of their financial markets.

Larger rival Cathay Financial 2882.TW on Wednesday said it planned to invest T$100 billion ($3 billion) in China stocks and real estate when Taiwan permits such investments. [ID:nTP207842]

On Thursday, shares of Chinatrust went 7 percent limit up, outpacing the broader market's .TWII 0.09 percent gain. ($1=T$33.1) (Reporting by Rachel Lee; Writing by Faith Hung; Editing by Lee Chyenyee)