Domestic banks’ exposure to China remained at a record-high level at the end of last year, making China Taiwan’s largest debtor, the central bank said yesterday.
On an ultimate risk basis, Taiwanese banks’ outstanding international claims to China totaled US$45.88 billion (NT$1.4 trillion) as of the end of last year, up US$10.75 billion from the previous quarter, the central bank said in its quarterly report.
“The rise in commercial activities between China and Taiwan has boosted domestic banks’ exposure to China [over the past few years],” Su Dao-min (蘇導民), deputy head of the monetary authority’s Banking Examination Department, said at a press conference in Taipei.
Following the launch of yuan business in domestic banking units, coupled with the increasing number of domestic banks planning to set up branches across the Taiwan Strait, international claims on China may well increase further, Su added.
In an unusual move, the central bank refused to release the rankings of counties with the highest number of international claims from Taiwanese banks at the press conference, saying that it wanted to “avoid the public inferring anything incorrectly.”
However, the financial authority ended up releasing the data after reporters questioned the decision, raising concerns that concealing the data was related to the recent protests against the cross-strait service trade agreement.
The total number of international claims of domestic banks — including their domestic banking units, offshore banking units and overseas institutions — totaled US$254.79 billion as of the end of last year, up 8.21 percent quarter-on-quarter, mainly due to higher overseas loans.
Claims on Luxembourg amounted to US$41.9 billion at the end of last year, making it Taiwan’s second-largest debtor, followed by the US, on which Taiwanese banks had a total of US$29.4 billion of claims during the period, the report said.