Mon, Sep 02, 2019 - Page 16 News List

Financial exposure to HK declines

Staff writer, with CNA

Exposure of Taiwan’s financial sector to Hong Kong fell NT$34.7 billion (US$1.1 billion) from a month earlier to NT$993.5 billion in July at a time when investors took a more prudent attitude toward market conditions in the financial hub amid protests against China’s intervention in the territory, the Financial Supervisory Commission (FSC) said.

The massive demonstrations and violence in Hong Kong have shaken the status of the territory as a global financial center, which has kept some foreign investors away, analysts said.

However, the commission said it remains to be seen whether the decline in exposure to Hong Kong is a direct result of the turmoil and it needed more time to monitor market conditions.

It is possible that the decline was simply a result of the Taiwanese financial sector’s normal business adjustments, the commission said.

Data compiled by the commission showed that Taiwan’s banking sector extended NT$542.9 billion in loans to Hong Kong and had invested NT$164.5 billion in the territory in July.

The total exposure for the local banking sector was NT$707.4 billion as of the end of July, the data showed.

Branches of Taiwanese banks in Hong Kong have been operating as usual, despite the unrest, Banking Bureau Deputy Director-General Sherri Chuang (莊秀媛) said.

As Taiwan’s banks in Hong Kong specialize in corporate banking, there has been no indications that individuals are making irregular withdrawals, Chuang said.

Total investment by Taiwanese securities firms in Hong Kong was about NT$80.30 billion, including marketable securities investment and business investment, Securities and Futures Bureau Deputy Director-General Tsai Li-ling (蔡麗玲) said.

Taiwanese insurers had a combined NT$205.8 billion of exposure to Hong Kong, accounting for 0.79 percent of the sector’s total capital, Insurance Bureau Deputy Director-General Wang Li-hui (王麗惠) said.

Of that, NT$204.2 billion was for life insurers and NT$1.5 billion for non-life insurers, Wang said.

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