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FSC puts subprime loss at NT$1.2bn

The financial regulator said yesterday that a provisional accounting puts local banks' losses from US subprime mortgage-related products at NT$1.2 billion (US$36 million), a day after saying their exposure to the products was NT$40.4 billion.

"Based on statistics provided by banks, out of the NT$40.4 billion investment, the losses so far amount to NT$1.2 billion," Financial Supervisory Commission Vice Chairman Susan Chang (張秀蓮) said.

"The estimate is on the potential loss and it's concentrated on the major banks,'' Chang said, without identifying the banks.

The financial regulator said on Wednesday that 16 of the nation's 42 local banks have some exposure to US subprime mortgage-related products.

On Thursday, the commission said "a minority" of the 16 invested directly in subprime debt, while the majority invested in subprime mortgage-related securitized products or in corporate bonds issued by subprime mortgage-related companies.
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