Lending extended by Taiwanese banks to China at the end of June trended lower as the efforts made by the government to tighten its monitoring of local lenders’ cross-strait exposure paid off, the central bank said.
However, China remained the largest debtor to the banking system and such massive exposure to China has raised concerns over a possible increase in risks at a time when the Chinese economy, the second largest in the world, showed signs of slowing down and prompted the government to watch more closely its development, market analysts said.
The central bank said that outstanding international claims by Taiwanese banks to China on a direct risk basis at the end of the second quarter fell US$2.4 billion from a quarter earlier to US$48.5 billion.
On an ultimate risk basis, which calculates a nation’s consolidated debts after risk transfers, Taiwanese banks’ lending extended to China also registered a drop, falling US$500 million from a quarter earlier to US$82.9 billion, marking the third consecutive quarterly decline.
Banks’ exposure to China at the end of June fell US$5 billion and US$10 billion on a direct risk basis and on an ultimate risk basis respectively, from a peak recorded at the end of September last year, central bank statistics showed.
Compared with the end of December last year, banks’ lending to China at the end of June also fell US$600 million and US$1.3 billion on a direct risk basis and on an ultimate risk basis respectively, the data showed.
The central bank said that the data show efforts by the Financial Supervisory Commission and other government agencies to tighten their control on banks’ exposure to China have been effective.
The bank said that the monitoring has helped the local banking sector rein in possible risks.
The central bank said that Taiwanese banks own 23 branches, 10 sub-branches and two subsidiaries in China, and the number of offices have been increasing amid warming economic exchanges across the Taiwan Strait.
In terms of total outstanding international claims by Taiwanese banks, at the end of June, the amount on a direct risk basis reached US$289.8 billion, up US$5.9 billion, or 2.08 percent, from the end of March, the central bank said.
After China, Luxembourg ranked as the second-largest debtor to Taiwan on a direct risk basis after banks extended US$39.92 billion in loans to the European nation, ahead of Hong Kong with US$33.67 billion, the US with US$33.13 billion and the British West Indies with US$14.58 billion.
Britain came in sixth with US$14.38 billion, followed by the Cayman Islands with US$12.19 billion, Singapore with US$9.62 billion, Japan with US$6.54 billion and Australia with US$6.23 billion.
The central bank said the top 10 debtors with aggregate borrowing of US$218.7 billion accounted for 75.48 percent of total international claims at the end of June.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last