Wed, Jul 26, 2006 - Page 12 News List

Taishin bad debt ratio worsens

By Jackie Lin  /  STAFF REPORTER

Taishin International Bank (台新銀行), the nation's largest cash-advance card issuer, posted a non-performing loan (NPL) ratio of more than 8 percent in cash cards for the third consecutive month, according to figures released by the Financial Supervisory Commission (FSC) yesterday.

The bank's NPL ratio for cash cards jumped from 3.573 percent in March to 8.177 percent in April and continued rising to 8.116 percent in May and 9.29 percent last month, the figures showed.

Under the "3-5-8" management policy that the FSC implemented in September 2004, financial institutions with an NPL ratio topping 8 percent are required to stop issuing new cards.

As Taishin International did announce in May that it would no longer issue new cards, there might not be any punishments for the bank, but the FSC will continue to demand that the bank slash its NPL ratio as soon as possible, said Gary Tseng (曾國烈), director general of the FSC's Banking Bureau.

Carol Lai (賴昭吟), chief financial officer of Taishin Financial Holding Co (台新金控), the parent company of Taishin International, said during a phone interview that the bank's ongoing debt-relief program has made it temporarily difficult to charge off bad loans.

However, Taishin International would set aside provisions every month in the second half of the year to cover potential bad debts, Lai said.

The bank also plans to have its first public auction at the end of this month to sell a maximum of NT$15 billion (US$457.3 million) in unsecured consumer loans, which should drastically reduce its NPL ratio, she said.

This story has been viewed 2892 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top