The chairman of the Central Deposit Insurance Company (CDIC,
Lin Wei-yi (
According to the insurance fund, there is just NT$2.7 billion (US$88 million) in bailout money on hand in case one of the nation's 458 financial institutions fail.
"With so many financial institutions currently insured by the CDIC and the overdue loan ratio of many credit cooperatives higher than 50 percent, how could the CDIC meet it obligations if several institutions failed at once?" asked Lai Shi-bau (
Lin responded, saying that if Taiwan were to hold 1.2 percent of the nation's bank deposits in reserves -- the standard in the US -- another NT$900 billion (US$30 billion) would be need.
"Based on the current rate of collection, Taiwan would need at least another 15 years to accumulate sufficient reserves," Lin said. "If we set a short-term target of NT$30 billion, with an annual revenue of NT$3 billion currently, it would take 10 years to accomplish the short-term goal."
But if the insurance fund needed some emergency cash, it would then have to borrow from the Central Bank of China (
Legislators also questioned CDIC officials over the organization's deposit insurance rates, complaining that the rate system is unfair.
Currently the agency charges between 0.05 to 0.06 percent of a financial institution's total deposit balances, depending on the risk level of the institution.
Chen Chung (
Taiwan is currently reviewing the system to decide whether a change is required. Chen stressed that current rates, however, were much lower than most countries in the world.
Another topic of discussion was Chung Shing Commercial Bank (
"A number of state-controlled banks have expressed their interest in Chung Shing Commercial Bank," said Chen Chang-sang (
Lin also said several large companies and other financial institutions have expressed interest in Chung Shing, but were waiting for the bank's latest financial disclosures.
Both Chen and Lin declined to name the identity of the interested parties.
Legislators also questioned the timing of bank runs on both Chung Shing and Taiwan Development Trust Company (
They said the runs may have been a part of a KMT revenge move carried out by the Ministry of Finance (
But Chen Chung downplayed the theories. "Financial examinations are part of a routine annual schedule and have nothing to do with any post-election political revenge," the deputy finance minister said. "According to the schedule, 40 percent of examination work will be completed at the end of this month and the remaining 60 percent at the end of the year."
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
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