Following data released this week showing that the nation's most troubled banks were getting worse, an industry watcher yesterday urged the government to take action quickly so that they do not become an even greater burden on taxpayers.
"They have become vampire banks, sucking the blood from the government's [coffers]," said Chen Chung-hsing (陳松興), president and CEO of Taiwan Ratings Corp (中華信評), the local arm of Standard & Poor's.
The latest figures from the central bank, released on Wednesday, show that the non-performing loan (NPL) ratio at the end of December at six of the nation's 10 worst-performing banks had risen by between 3 and 10 percentage points from the same period last year.
Chen urged the legislature to hasten the approval of the government's NT$908.6 billion Financial Restructuring Fund (
"The longer the plan is delayed, the more losses the taxpayer will have to cover," Chen said.
At the worst financial institutions, the Ministry of Finance's efforts to reduce bad loans appear to have failed.
Banks where the NPL ratio rose during the past two years include Chung Shing Commercial Bank (中興銀行), from 57.34 percent to 64.53 percent; Kaohsiung Business Bank (高雄企銀), from 33.86 percent to 43.50 percent, and Hualien Business Bank (花蓮企銀), from 27.69 percent to 27.87 percent.
The 10 most-troubled banks had an average NPL ratio of 25.3 percent, up from 24.4 percent in 2001. The slow economic recovery, however, continues to strain banks' ability to generate earnings and deal with their bad loans.
Public funding will be needed to support bank lending and help them alleviate their financial problems, Paul Grela, director of Fitch Ratings' financial institutions in Asia, said yesterday.
After writing off a record NT$410 billion in bad loans, banks reported an average 8.85 percent NPL ratio last year. According to Fitch, the figure may actually be between 12 percent and 15 percent, while Chen estimates the figure to be between 10 percent and 12 percent.
Opposition parties have been accused of stalling the passage of measures to deal with the NPL problem in an attempt to undermine President Chen Shui-bian's (
But PFP Legislator Norman Yin (
Rising defaults on consumer debt, which accounts for 47 percent of all bad loans, may further deteriorate the nation's bad-loan problem this year, Yin said.
SECURITY: As China is ‘reshaping’ Hong Kong’s population, Taiwan must raise the eligibility threshold for applications from Hong Kongers, Chiu Chui-cheng said When Hong Kong and Macau citizens apply for residency in Taiwan, it would be under a new category that includes a “national security observation period,” Mainland Affairs Council (MAC) Minister Chiu Chui-cheng (邱垂正) said yesterday. President William Lai (賴清德) on March 13 announced 17 strategies to counter China’s aggression toward Taiwan, including incorporating national security considerations into the review process for residency applications from Hong Kong and Macau citizens. The situation in Hong Kong is constantly changing, Chiu said to media yesterday on the sidelines of the Taipei Technology Run hosted by the Taipei Neihu Technology Park Development Association. With
CARROT AND STICK: While unrelenting in its military threats, China attracted nearly 40,000 Taiwanese to over 400 business events last year Nearly 40,000 Taiwanese last year joined industry events in China, such as conferences and trade fairs, supported by the Chinese government, a study showed yesterday, as Beijing ramps up a charm offensive toward Taipei alongside military pressure. China has long taken a carrot-and-stick approach to Taiwan, threatening it with the prospect of military action while reaching out to those it believes are amenable to Beijing’s point of view. Taiwanese security officials are wary of what they see as Beijing’s influence campaigns to sway public opinion after Taipei and Beijing gradually resumed travel links halted by the COVID-19 pandemic, but the scale of
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
Pope Francis is be laid to rest on Saturday after lying in state for three days in St Peter’s Basilica, where the faithful are expected to flock to pay their respects to history’s first Latin American pontiff. The cardinals met yesterday in the Vatican’s synod hall to chart the next steps before a conclave begins to choose Francis’ successor, as condolences poured in from around the world. According to current norms, the conclave must begin between May 5 and 10. The cardinals set the funeral for Saturday at 10am in St Peter’s Square, to be celebrated by the dean of the College
RSS