Overseas earnings of Taiwanese banks were boosted by the government’s “new southbound policy,” with their first-quarter incomes from the countries covered by the policy hitting a new high, according to data released yesterday by the Financial Supervisory Commission (FSC).
The initiative aims to forge closer economic ties with ASEAN members, South Asia, Australia and New Zealand.
In the first quarter, banks’ earnings posted in the countries targeted by the policy reached NT$1.72 billion (US$57.01 million).
The commission said that Vietnam, Cambodia and Australia ranked as the largest earnings sources for Taiwanese banks in the first quarter, with income generated in Vietnam reaching NT$700 million, while in Cambodia the figure reached NT$400 million and in Australia it was US$200 million.
The improvement in banks’ profitability also reflected the commission’s efforts to urge the state-owned Export-Import Bank of the Republic of China (輸出入銀行) to provide guarantees and insurance for trade contracts, which have made banks more willing to extend loans to Taiwanese firms that cut deals with their counterparts in the region, the commission said.
The commission also said that it has encouraged banks to extend loans to Taiwanese investors operating in the “southbound” region, while urging Taiwanese firms in the region to raise funds in the local capital market
Since the beginning of the year it has also given the green light to local banking institutions that want to establish new outlets in the region to secure more loan deals, with 10 new outlets approved so far, the commission said.
Taiwan Cooperative Bank (合作金庫), Chang Hwa Commercial Bank (彰化銀行) and First Commercial Bank (第一銀行) obtained approval to open new branches in Cambodia, while Chang Hwa Bank and Taiwan Business Bank (台灣企銀) were given permission to add branches in the Philippines, it said.
Taiwan Cooperative Bank received approval for a branch in Melbourne, Bank of Taiwan (台灣銀行) for one representative office each in Vietnam, Thailand and Indonesia, and the Export-Import Bank obtained permission to open an office in Mumbai, India.
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