With cross-strait business ties growing closer than ever, China ranked the second-biggest debtor to banks operating in Taiwan as of the end of March, the central bank said.
Citing its statistics released on Friday, the central bank said Taiwanese banks’ outstanding international claims to China as of the end of the first quarter hit a record high of US$30.46 billion because an increasing number of local financial institutions were setting footholds in China.
Local banks’ outstanding international claims to Luxembourg, the largest debtor to Taiwanese banks, totaled US$44.26 billion as of the end of March, because the European country had become the favorite destination of local investors to park their money in mutual funds, the central bank said.
As of the end of March, Taiwanese banks’ outstanding international claims totaled US$231.78 billion, representing an increase of US$12.98 billion from the end of December last year, the central bank said.
Taiwan’s international claims included the loans extended by local banks’ offshore banking units and their overseas branches, it said.
The US was the third-largest debtor to Taiwanese banks at the end of the first quarter, ahead of Hong Kong, the West Indies, the UK, the Cayman Islands, Singapore, Australia and Ireland, the central bank said.
Out of the total outstanding international claims by Taiwanese banks, 70.62 percent were loans carrying a maturity of less than one year and 21.66 percent would be due in two years, the statistics showed.
Banks from the debtor countries accounted for 27.73 percent of Taiwanese banks’ total exposure, while the private sectors, excluding banks, in those countries made up 69.35 percent of the banks’ total loans and the public sectors represented 2.92 percent, according to the statistics.
Meanwhile, the central bank said Taiwan’s international investments at the end of last year recorded a net asset position of US$801.7 billion, up US$75.7 billion, or 10.4 percent, from the end of 2011.
As a result, the county’s net international investment positions were the world’s fifth-highest, following Japan, China, Germany and Switzerland, it said.
Taiwan’s external assets at the end of last year totaled US$1.29 trillion, up US$123.7 billion or 10.6 percent from a year earlier due to an increase of securities investments by local investors, it said.
In the past year, local insurance companies poured more funds into overseas equity and bond markets, while local investors raised their foreign portfolio holdings through the purchase of mutual funds, the bank said.
It added that the gains posted by global equity markets also boosted the value of local investors’ overseas portfolio holdings.
At the end of last year, Taiwan’s total external liability reached US$492.6 billion, up US$48 billion, or 10.8 percent, from a year earlier, reflecting an increase in foreign investments in the local bourse and higher domestic share prices, the central bank said.