The domestic banking sector’s bad-loan ratio dropped to a new low of 0.46 percent at the end of last month, from 0.48 percent one month earlier, the Financial Supervisory Commission said in a statement yesterday.
Of the 37 domestic lenders, 36 had a non-performing loan ratio below the 2 percent mark, the commission said in the statement.
The bad-loan ratio for Cosmos Bank Taiwan (萬泰銀行) remained relatively high at 5.65 percent. The ratio was attributed to a bad loan of NT$1.6 billion (US$55.11 million) to the cash-strapped Prince Motor Group (太子汽車) as part of its secured lending valued at NT$5.6 billion.
Prince Motor is the local sales agent of Japan’s Suzuki Motor Corp. The company’s chairman, Hsu Sheng-fa (許勝發), is also the founder and former chairman of Cosmos Bank, but relinquished control after selling a combined 80 percent stake in 2007.
As of July 31, the domestic banking sector’s bad loans totaled NT$96.9 billion, down NT$2.6 billion from a month earlier. Outstanding loans amounted to NT$20.87 trillion last month, up NT$164.7 billion from a month earlier, the commission’s data showed.
In related news, Fubon Financial Holding Co (富邦金控) yesterday restated its first-half net income as NT$15.16 billion, compared with NT$17.42 billion it announced on Aug. 11.
The company said in an e-mailed statement that the discrepancy of NT$2.26 billion was because of lower retained earnings at its life insurance subsidiary, Fubon Life Insurance Co (富邦人壽), as demanded by the commission.