Taiwan’s bad loan ratio dropped further to 0.43 percent at the end of December, from 0.45 percent one month earlier, suggesting improvement in the quality of assets of domestic lenders, the Financial Supervisory Commission (FSC) said in a statement released yesterday.
Overall bad loans amounted to NT$92.8 billion (US$3.14 billion) as of late December, falling NT$4.4 billion from the end of November, the FSC statement said.
The average coverage ratio climbed to 251.83 percent, up 22.41 percentage points from 229.42 percent at the same time a month earlier, the statement said.
The improvement came as aggregate outstanding loans rose to NT$21.51 trillion, gaining NT$114.9 billion from a month earlier, the statement said.
Cosmos Bank (萬泰銀行), the nation’s largest cash card issuer, is the only lender with a non-performing ratio above the 2 percent threshold at 7.64 percent, or NT$6.3 billion, the statement said.
The medium-sized bank remains mired in loan losses caused by Prince Motors Group (太子汽車), the local sales agent of Japan’s Suzuki Motor Corp.
Two previous attempts to auction a collateral office building on Dunhua S Rd failed to attract any bidder, although similar properties nearby drew heated bidding by local life insurance firms.
The FSC said it would press Cosmos to improve its asset quality and financial structure.
The financial regulator also approved plans by Land Bank of Taiwan (土地銀行) to set up its second branch in Tianjin, China, to boost its standing across the strait.
The state-owned lender, devoted to land financing at home, opened a branch in Shanghai last year.
Meanwhile, the FSC issued a separate statement denying President Ma Ying-jeou (馬英九) is considering reviving a study on taxing capital gains in his second term as local media have reported.
The reports are inaccurate, Financial Supervisory Commission Chairman Chen Yuh-chang (陳裕璋) said in the statement after speaking with premier-designate Sean Chen (陳冲) by telephone.