Despite its pace slowing in the third quarter, domestic banks’ exposure to China still reached more than US$20 billion at the end of September, making China Taiwan’s third-largest debtor, a report by the central bank said.
Figures released by the central bank on Friday showed that total international claims held by domestic banks stood at US$209.88 billion as of the end of September, up US$4.9 billion, or 2.39 percent, since the end of June.
International claims comprises all claims on non-residents in all currency units and foreign currency claims on residents.
“People in Taiwan invested more in overseas funds in the third quarter, further raising international claims for this period,” Su Dao-min (蘇導民), deputy head of the central bank’s banking examination department, said at a press conference.
This indicated Taiwanese maintained an optimistic attitude toward financial issues including the US’ “fiscal cliff” and the European sovereign debt crisis, Su added.
Claims on China totaled US$20.47 billion at the end of September, down US$1.17 billion from the level recorded at the end of June, ending the rising trend of the previous 13 quarters, central bank data showed.
However, domestic banks’ exposure to China has grown significantly in the past four years, as more banks set up branches in China after President Ma Ying-jeou’s (馬英九) administration eased restrictions, which Su said should keep on increasing in the future.
As of the end of the second quarter, the nation’s claims on China remained the third-largest of all countries, behind claims on Luxembourg and the US, the bank said in its quarterly report.
In related news, Cathay United Bank (國泰世華銀行) and five other local banks on Friday announced they had signed a 10-year US$600 million syndicated loan agreement with Vietnam’s state-owned carrier, Vietnam Airlines Corp, to finance the purchase of an Airbus 321 aircraft.
Other than Cathay, the five other banks were Shin Kong Commercial Bank (新光商業銀行), Union Bank of Taiwan (聯邦銀行), Hua Nan Commercial Bank (華南商業銀行), Taichung Commercial Bank (台中商業銀行) and Shanghai Commercial & Savings Bank (上海商業儲蓄銀行).
“This is the first time Taiwanese banks provided a syndicated loan to Vietnamese state-owned companies and it is an important milestone for Taiwanese banks’ expansion in Southeast Asia,” Cathay Financial spokesman Alan Lee (李偉正) said in a statement.
The new A321 aircraft is scheduled to be delivered later this month.
Vietnam Airlines signed a purchasing agreement for 26 aircraft, with delivery dates starting last year and running through to 2015.