The Financial Supervisory Commission (FSC) yesterday fined Chaoyang Life Insurance Co (朝陽人壽) NT$6 million (US$181,615) and issued three citations for a number of irregularities.
The troubled insurer faces being placed under government receivership as soon as the first quarter of next year, the commission said.
The insurer would be placed under government receivership if it fails to raise its risk-based capital (RBC) ratio to more than 50 percent within 90 days of Dec. 31, the commission said.
The RBC ratio is a measure of a company’s financial strength. At the end of the third quarter, Chaoyang Life, which currently has about 100,000 policy holders, said its negative net worth had expanded to NT$2.2 billion.
Although the insurer’s board of directors in September approved a NT$1.55 billion capital increase plan, the commission said that the amount is not sufficient to cover the company’s negative net worth.
Chaoyang Life’s capital increase plan is backed by a plot of land adjacent to Taichung’s Chaoyang University of Technology (朝陽科技大學), where the insurer plans to build a student dormitory and commercial complex and raise funds through rental fees, the company said last month.
The company has also readied a NT$500 million cash injection, it said.
Among the infractions that led to the commission’s imposition of fines on the company were irregularities relating to its purchase of a plot of undeveloped land, as Chaoyang Life had failed to generate the required investment returns from the parcel.
In related news, despite appeals by the Life Insurance Association of the Republic of China (壽險公會) for RBC requirements to be eased to help companies weather heightened volatility in global markets, the commission’s Insurance Bureau seems to be gearing up to impose more stringent guidelines on the sector.
Insurers said that their efforts this year to increase capital would be nullified by the bureau’s intent to raise the interest rate and C3 market risk components of the RBC metric for annuities from 0.1 times to 0.3 times.
Mercuries Life Insurance Co (三商美邦人壽) said that its NT$1.7 billion capital increase plan was expected to elevate its RBC ratio by at least 10 percent, but following the change, newly raised funds through its issuance of 100 million new shares at NT$17 each would barely make a difference to its RBC ratio.
Other insurers said that they would have no option but to reduce their holdings of more risky assets in order to meet the new RBC requirements set to take effect next year.
“We found no compelling reasons to grant insurers eased RBC requirements,” Insurance Bureau Director-General Jenny Lee (李滿治) said, adding that the bureau intends to continue raising the C3 rate on an annual or biannual basis.
SELF-SUFFICIENCY: Alibaba is one of a number of Chinese firms that has answered Beijing’s call to invest in the development of cutting-edge technologies Alibaba Group Holding Ltd (阿里巴巴) yesterday unveiled a new server chip that is based on advanced 5-nanometer technology, marking a milestone in China’s pursuit of semiconductor self-sufficiency. The Chinese tech giant’s newest chip is based on micro-architecture provided by the SoftBank Group Corp-owned Arm Ltd, it said. Alibaba, which is holding its annual cloud summit in Hangzhou, China, said that the chip is to be used in its own data centers in the “near future” and would not, for the time being, be sold commercially. “Customizing our own server chips is consistent with our ongoing efforts toward boosting our computing capabilities with better
Production at Taiwan Semiconductor Manufacturing Corp’s (TSMC, 台積電) fabs was not affected by a fire at a construction site for a water recycling facility in the Southern Taiwan Science Park in Tainan. The world’s biggest contract chipmaker said that the construction site is not adjacent to its fabs, which were unaffected. CTCI Corp (中鼎工程) is responsible for the construction of the facility, which it is to operate itself once it is completed, the chipmaker said. The facility caught fire at about 11am, and the blaze was brought under control about 30 minutes after the incident was reported, the Southern Taiwan Science Park Administration
‘SHORT-TERM ECONOMIC PAIN’: A military takeover would only temporarily weigh on wafer production on both sides of the Taiwan Strait, IC Insights said Taiwan has more chip manufacturing capacity than any other economy in the world, US-based market information advisory firm IC Insights said in a research paper last week, cautioning that the nation’s strength could prompt China to attempt to take over Taiwan. Taiwan commanded 21.4 percent of global installed IC capacity, ahead of South Korea’s 20.4 percent, Japan’s 15.8 percent and China’s 15.3 percent, North America’s 12.6 percent and Europe’s 5.7 percent, IC Insights said. Taiwan is one of two countries that uses 10-nanometer technology or better to produce wafers, holding 62.8 percent of global capacity, with South Korea holding the remaining 37.2
AGGRESSIVE STEP: With the new processors, Apple is aiming at the high-end chips Intel has provided for the MacBook Pro and other top-end Macs for about 15 years Apple Inc on Monday took the most aggressive step yet to strip Intel Corp chips from its computers, announcing more powerful homegrown Mac processors alongside a total revamp of its MacBook Pro laptop computers. The company showcased the chips at an event called “Unleashed,” which also included its latest audio products. The new components, called the M1 Pro and M1 Max chips, are 70 percent faster than its M1 predecessors, Apple said. It also unveiled a redesigned MacBook Pro, adding larger screens, MagSafe charging and better resolution. With the new processors and devices, Apple is aiming squarely at the high-end chips that Intel has