Taiwan banking group Chinatrust Financial Holdings says it is still interested in buying Nan Shan Life, which debt-laden American Insurance Group sold to a Hong Kong-based consortium comprising China Strategic Holdings and Primus Financial for US$2.15 billion last year. Regulators in Taiwan are scrutinising the funding for the deal and the backgrounds of the Hong Kong bidders, both of which are said to be closely linked with China. Raymond Or Ching-fai, chief executive of China Strategic, resigned from the top mainland advisory body, the Chinese People's Political Consultative Conference, after politicians and regulators expressed concern about a possible conflict between his advisory role and his leadership of the bid. The Hong Kong bidders have bought more time from AIG, which has extended the deadline for the completion of the sale of the insurer by three months to October 12. The insurance bureau of Taiwan's financial regulator, the Financial Supervisory Commission (FSC), said it was asking for more documents from the Hong Kong consortium to prove that its shareholding structures were stable. It said the bidders had yet to demonstrate their commitment to running Nan Shan and their ability to raise funds in future. A spokesman for Chinatrust said yesterday that if China Strategic failed to receive regulatory approval, it would bid for Nan Shan Life if a second-round auction for the insurer takes place. But he also said Chinatrust would consider buying Nan Shan Life from the Hong Kong bidders if the deal was acceptable to the regulators. He declined to say how much of the insurer Chinatrust planned to purchase. Chinatrust had agreed in a memorandum of understanding last year to acquire 30 per cent of Nan Shan Life for US$660 million, with China Strategic getting a 9.95 per cent stake in Chinatrust in return. The arrangement immediately drew criticisms from the FSC, saying that it was not 'appropriate' and that it would 'complicate' the deal. Chinatrust president Daniel Wu Ei-kwei told shareholders last week that it would not renew the arrangement with China Strategic - it expired on June 25. According to Taiwanese media, in a 7 1/2hour meeting last week shareholders grilled Wu on the arrangement with China Strategic. Wu told the shareholders that Chinatrust would not let China Strategic invest in it unless the regulator gives it the go-ahead. The shareholders gave the banking group approval to sell 2.5 billion shares to raise NT$41.9 billion (HK$10.9 billion) to enlarge its share capital for a possible acquisition of Nan Shan Life shares. Wu yesterday told Bloomberg that Chinatrust 'is eager to renew its offer for the life-insurance subsidiary in the best interest of AIG shareholders, including US taxpayers'.