DBS Bank Taiwan (星展銀行) aims to increase its lending to small and medium-sized enterprises (SMEs) by 25 percent this year even as weaker-than-expected exports dampen loan demand, senior executives said yesterday.
For the first three months of the year, the Singaporean bank led four other foreign lenders in terms of SME loans that totaled NT$22.6 billion (US$754.3 million), accounting for a 40.7 percent share of the market, Kenneth Cheng (鄭克家), head of DBS’ institutional banking unit, told a media briefing.
Local branches of Citibank, HSBC and ANZ loaned NT$32.9 billion to SMEs in the first quarter, Cheng said, citing Financial Supervisory Commission data.
“The growth target is aggressive and challenging given Taiwan’s lackluster exports” that grew a mild 1.9 percent in the first four months, he said.
The poor showing of the nation’s export sector may lead companies to take a cautious approach toward investment and expansion, Cheng said, adding that he has seen zero growth in loans for equipment financing so far this year.
Cheng said the slowdown in loan growth is more evident in the construction and retail sectors because of the central bank’s credit tightening measures and a lack of consumer confidence.
However, DBS Taiwan expects to expand its SME customer base by 800 this year, with an increase of 50 to 100 customers a month, Cheng said.
DBS Taiwan Institutional Banking vice president Jeff Wan (萬中舉) said he is courting garment suppliers, shoemakers and customers in other non-technology sectors who have capitalization of NT$500 million or less.
These sectors do not command the spotlight like technology firms but they pose a great business opportunity for DBS Taiwan, Wan said.