Chinese yuan deposits rise
Chinese yuan-denominated deposits at the offshore banking units (OBU) of banks operating in Taiwan hit another record high at the end of September, the central bank said on Saturday.
As of the end of September, Chinese yuan deposits had totaled NT$17.98 billion (US$2.88 billion), up about 2.5 percent from the NT$17.54 billion recorded in August and compared with NT$71 million at the end of August last year.
The Financial Supervisory Commission lifted a ban in July last year to allow OBUs to conduct yuan business.
However, despite the increase in Chinese yuan deposits the central bank said the total assets of the OBUs as of the end of September had fallen to US$162.14 billion from US$165.14 billion recorded at the end of August.In September, foreign exchange transactions at the OBUs totaled US$34.56 billion, up from US$31.57 billion registered in August.
Central bank auctions debt
The central bank on Friday sold NT$100 billion of 364-day negotiable certificates of deposit (NCDs) through an auction with an average interest rate of 0.758 percent, down from 0.805 percent recorded in the previous sale, as the market was awash with liquidity.
The interest rate for the 364-day NCD also plunged to a new low in 21 months, according to the central bank’s statistics.
The rate had hit had been as high as 1.054 percent at a similar sale of such debt in August last year.
Local financial institutions participating in Friday’s auction offered a total of NT$356.5 billion worth of funds to bid the NT$100 billion NCDs, higher than the NT$347 billion bidders put up in the previous sale.
So far, outstanding 364-day NCDs have totaled NT$1.2 trillion.
The sale has the same effect as the central bank raising the bank deposit reserve ratio by about 4.5 percentage points.
Taiwan in closer Bhutan links
The Taiwan External Trade Development Council (TAITRA, 外貿協會) and Bhutan’s largest business group signed a memorandum of understanding on Friday to work more closely together on bilateral trade promotion.
Topgyal Dorji, president of the Bhutan Chamber of Commerce and Industry, signed the memorandum on behalf of his country’s business delegation, while Chao Yuen-chuan (趙永全) signed on behalf of TAITRA in his capacity as the council’s secretary-general.
Bhutan has no manufacturing industry and relies on imported products.
Therefore, there are business opportunities for Taiwanese entrepreneurs, according to TAITRA.
Bank extends China base
Taipei-based China Development Industrial Bank (CDIB, 中華開發工銀), the flagship investment banking unit of China Development Financial Holding Co (中華開發金控), will work with a Chinese counterpart to set up a private equity fund in China.
CDIB signed a memorandum of understanding with Jiangsu High-Tech Investment Group (江蘇高科技投資集團), also known as Govtor Capital, on Friday to set up a 2 billion yuan (US$321 million) private equity fund in the Chinese province.
It is the second private equity fund for CDIB in China after the Taiwanese investment bank built the first in Fujian Province in September last year.
However, CDIB did not disclose its own share in the joint fund with Govtor Capital.
Taiwan, UK in ‘smart grid’ deal
Taiwan and the UK will work more closely together on developing the “green industry” by signing a protocol of collaboration today, according to the British Trade and Cultural Office in Taipei.