State-owned Land Bank of Taiwan (土地銀行), the nation’s largest property lender, expects construction and land financing to increase modestly this year even though housing transactions could shrink further amid cautious sentiment, chairman Wu Tang-chieh (吳當傑) said yesterday.
“The correction in the housing market might last a while longer as sellers and buyers might need more time to digest the new property tax and policy uncertainty linked to the power transition,” Wu told a news conference.
The lender’s construction and land financing amounted to NT$275.5 billion (US$8.23 billion) last year, a decrease of 8.44 percent from 2014, but consistent with an 8 percent retreat in the nation’s housing deals during the same period, company data showed.
Despite a soft market, Land Bank did not report any bad loan from its construction financing, thanks to careful credit control, Wu said.
The bank terminated transactions with clients with a troubled credit profile, including Weiguan Construction Co (維冠建設公司), the developer of the apartment complex that collapsed in the magnitude 6.4 earthquake on Feb. 6, killing 115 people.
Land Bank expects to keep construction and land financing at NT$294 billion this year, representing a 1.14 percent drop from the goal set for last year, but a 6.7 percent increase from the actual balance at the end of December last year, according to company statistics.
Developers and builders have said that they intend to stay on the sidelines until they can gain a better understanding of the incoming government and its policy directions.
However, the low interest rates and preferential mortgage terms for young people might lend support to the market, Wu said.
The central bank is likely to cut interest rates next month and again in June on expectations that cheaper borrowing costs would boost private investment and big-item consumption, analysts have said.
The loose monetary policy would weigh on Land Bank’s interest margin that averaged 1.96 percent for home loans, 2.5 percent for land purchases and higher for construction projects last year, Wu said.
To mitigate the impact, Land Bank would seek to diversify its sources of income by bolstering overseas operations, among other moves, he said.
The bank is to go ahead with the initial public offering plans that are likely to bring an additional NT$30 billion in new capital and a government fund is likely to chip in another NT$7 billion, Wu said.
The planned capital increase would allow the bank to improve its capital strength, as it lags behind peers and has had difficulty introducing new funds because investors frown on unlisted firms.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts