ANZ officially upgraded its operation in Taiwan on Monday, turning it into a local banking subsidiary under the name of ANZ Bank (Taiwan) Ltd.ANZ Bank (Taiwan), the locally incorporated subsidiary, has paid in capital of NT$20 billion (A$636 million), following a direct capital injection of NT$14 billion (A$445 million) from parent ANZ, Jean Chiu, deputy director-general of the Financial Supervisory Commission's banking bureau in Taipei, said yesterday.The remaining NT$6 billion (A$191 million) of assets have been converted into 600 million shares, which have a face value of NT$10 (A$0.32) each, and are held by the parent banking group, Chiu added.The bank is the fifth major foreign bank to establish a subsidiary in Taiwan, and joins Citibank Taiwan, SCB Taiwan, HSBC Taiwan and DBS Taiwan. Alistair Bulloch will be appointed as chairperson.ANZ has committed to forgo it dual licence privileges by the end of 2014."After assessing its portfolios and client accounts, ANZ Bank (Taiwan) [has agreed] to terminate its foreign bank branch licence by the deadline," Chiu said.She added that DBS Taiwan has agreed to let go of its dual licence by the end of this year. The regulator is still negotiating a deadline with the three remaining foreign banks that have been locally incorporated.Such privileges allow foreign banks to offer more generous loan terms to corporate borrowers, through their foreign bank branches, and, thus, represent unfair competition against local lenders.In addition, the bureau's latest statistics show that ANZ, with a net worth of NT$10.1 billion (A$322.3 million), incurred a pre-tax loss of NT$125 million (A$4 million) in the month of February 2013.But, Chiu said, this loss should be a one-time expense for the bank, which "has been a very healthy institution in terms of its business operation and compliance."Prior to its local incorporation, the bank's chief executive officer, Terry King, expressed a positive outlook, saying he expected the bank's revenue to "jump" this year.The bank posted a pre-tax profit of NT$2.14 billion (A$68 million) in the year to December 2012, 19 per cent down from NT$2.64 billion (A$84 million) in 2011, the regulator's statistics showed.ANZ Bank (Taiwan) currently operates 14 outlets in major cities in Taiwan, with around 1,500 staff, after it closed four "not ideally located" outlets in the Greater Taipei area before June 2012.