Regulators and financial companies yesterday said elevating professional proficiency is becoming more important as the sector faces unprecedented challenges nationally and worldwide.
Financial Supervisory Commission Vice Chairman Kuei Hsien-nung (桂先農) painted a grim picture of global financial markets at a ceremony honoring this year’s newly qualified financial professionals who have earned Certified Financial Planner (CFP) and the Associate Financial Planner (AFP) designations conferred by the US-based Certified Financial Planner Board of Standards Inc.
In addition to Brexit and the US Federal Reserve’s potential rate hike, cycle-induced foreign exchange volatility and narrowing interest margins, the global financial sector faces challenges from extreme weather conditions caused by climate change and strains from the increased life expectancy of an aging population, Kuei said.
Rising competition from a formidable technology sector is also emerging as a challenge, as financial services become increasingly digitized and mobile, Kuei said.
International regulatory standards have continued to grow more stringent, such as the Basel Accord and International Financial Reporting Standards, and the nation’s financial sector remains overcrowded with too many institutions, considering the limited scale of the domestic market, Kuei said.
“Taiwan has one of the highest market penetration rates for the insurance sector in the world, but this is not something to be proud of, as it shows that the market is saturated,” he said.
Despite ample liquidity, the return on asset performance of Taiwan’s banks now ranks at the bottom among their Asian peers, he added.
Kuei said that he hopes the situation would improve as more financial professionals earn certifications such as the CFP and AFP.
Meanwhile, Cathay Financial Holding Co (國泰金控), the nation’s largest financial services provider by assets, maintains a survival of the fittest mentality regarding current challenges.
“Capable institution investors thrive on volatility, as they see profit opportunities when others fear to create profit,” Cathay Financial president Lee Chang-ken (李長庚) said.
Lee urged the government to initiate investment in infrastructure projects as an outlet for idle funds.
Building a new dam would help boost agriculture, tourism and generate hydro-electric power, he said.
Many ports abroad are operated by city governments, which provides an investment option for institutions, he added.
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