Mon, Jan 01, 2018 - Page 15 News List

US private debt to Taiwan banks hits record US$77bn

Staff writer, with CNA

Lending to the US by Taiwanese banks hit a record high at the end of September, as the US economy recovered, the central bank said on Wednesday.

According to data compiled by the central bank, outstanding international claims by Taiwanese banks to the US on a direct risk basis rose from about US$72.26 billion at the end of June to US$77.10 billion at the end of September.

This was the sixth consecutive quarter that the US has been the nation’s largest debtor.

On an ultimate risk basis, which calculates a country’s consolidated debts after risk transfers, the exposure of Taiwanese banks to the US rose to US$74.13 billion from US$69.956 billion over the three-month period, the data showed.

At the end of September, China replaced Luxembourg to become the nation’s second-largest debtor on a direct risk basis, after its bank lending to China rose from US$38.61 billion at the end of June to US$42.60 billion three months later, despite a move by the Financial Supervisory Commission to tighten supervision of bank exposure amid fears over possible negative impacts.

On an ultimate risk basis, Taiwan’s lending to China rose from US$62.39 billion to US$67.08 billion over the period, the data showed.

Luxembourg ranked as the third-largest debtor to Taiwan on a direct risk basis, after the nation’s banks extended US$40.25 billion to the European country, up from US$39.33 billion at the end of June, the data showed.

At the end of September, outstanding international claims by the nation’s banking sector on an ultimate risk basis rose 2.95 percent from the end of June to US$397.4 billion.

The central bank attributed the increase in outstanding international claims to a jump in Taiwanese banks’ lending to non-bank customers during the period.

The top 10 debtors accounted for almost 76 percent of Taiwan’s total outstanding claims at the end of September, the bank said.

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