The asset quality of local banks seemed to worsen last month, with rising bad debts and falling coverage coming amid fallout from the industry-wide credit abuse storm, according to data released by the Financial Supervisory Commission yesterday.
The average non-performing loan (NPL) ratio of 44 local lenders edged up to 2.41 percent last month, up from 2.39 percent in June, while the coverage ratio used to gauge the sufficiency of reserves to cover potential defaulted loans dropped to 46.45 percent, down from 47.52 percent over the same period, the data showed.
Bad debt-ridden Taitung Business Bank (
Enterprise Bank of Hualien's negative net worth deteriorated to minus NT$1.8 billion (US$54.74 million) last month from minus NT$1.67 billion in June.
Meanwhile, the credit card NPL ratio fell by 0.11 percentage points month-on-month to 2.92 percent last month, as the number of cards in circulation dropped 1.9 percent to 4.03 million and the revolving credit balance declined by 2.11 percent to NT$403.2 billion, the data showed.
However, the cash card NPL ratio rose by 0.9 percentage points from June to 7.78 percent last month.