The Japanese government's handling of the financial troubles of Resona Group is unlikely to fully resolve the lender's fundamental problems, Standard and Poor's Ratings Services said yesterday.
"A key concern for Standard and Poor's is whether the government's handling of the Resona case will merely be a repeat of the bank bailout in 1999," S&P director Takamasa Yamaoka said in a report.
"The [cash] infusion into Japan's major banks in 1999 was ultimately only a temporary solution and failed to eradicate the fundamental problems that had caused the shortage," he said.
The report came after the banking group formally asked the government to bail it out to the tune of Japanese Yen 1.96 trillion (US$16.6 billion) in public funds on Friday and announced a restructuring program, including the forced resignation of executives.
"The forced resignations should put pressure on managers at both Resona and other banks, which may accelerate a change in credit practices at Japanese banks," Yamaoka said. "However, real change in management's practices will hinge largely on the motives of all the participants."
Some politicians are likely to expect Resona Bank to keep playing a public role as a provider of financial support to the stagnant economy in the Kansai region in western Japan, he said.
This role may put a heavy drag on Resona's efforts to improve its profitability, he said.
Meanwhile, S&P said Tokyo's move to bail out the bank had no direct impact on its sovereign ratings on Japan. S&P said it regarded the non-performing loan problems as a contingent liability of the government and incorporated it as a rating factor.
Taiwanese suppliers to Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) are expected to follow the contract chipmaker’s step to invest in the US, but their relocation may be seven to eight years away, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. When asked by opposition Chinese Nationalist Party (KMT) Legislator Niu Hsu-ting (牛煦庭) in the legislature about growing concerns that TSMC’s huge investments in the US will prompt its suppliers to follow suit, Kuo said based on the chipmaker’s current limited production volume, it is unlikely to lead its supply chain to go there for now. “Unless TSMC completes its planned six
Intel Corp has named Tasha Chuang (莊蓓瑜) to lead Intel Taiwan in a bid to reinforce relations between the company and its Taiwanese partners. The appointment of Chuang as general manager for Intel Taiwan takes effect on Thursday, the firm said in a statement yesterday. Chuang is to lead her team in Taiwan to pursue product development and sales growth in an effort to reinforce the company’s ties with its partners and clients, Intel said. Chuang was previously in charge of managing Intel’s ties with leading Taiwanese PC brand Asustek Computer Inc (華碩), which included helping Asustek strengthen its global businesses, the company
Power supply and electronic components maker Delta Electronics Inc (台達電) yesterday said second-quarter revenue is expected to surpass the first quarter, which rose 30 percent year-on-year to NT$118.92 billion (US$3.71 billion). Revenue this quarter is likely to grow, as US clients have front-loaded orders ahead of US President Donald Trump’s planned tariffs on Taiwanese goods, Delta chairman Ping Cheng (鄭平) said at an earnings conference in Taipei, referring to the 90-day pause in tariff implementation Trump announced on April 9. While situations in the third and fourth quarters remain unclear, “We will not halt our long-term deployments and do not plan to
TikTok abounds with viral videos accusing prestigious brands of secretly manufacturing luxury goods in China so they can be sold at cut prices. However, while these “revelations” are spurious, behind them lurks a well-oiled machine for selling counterfeit goods that is making the most of the confusion surrounding trade tariffs. Chinese content creators who portray themselves as workers or subcontractors in the luxury goods business claim that Beijing has lifted confidentiality clauses on local subcontractors as a way to respond to the huge hike in customs duties imposed on China by US President Donald Trump. They say this Chinese decision, of which Agence