Insurance authorities said yesterday that they will made a final decision on whether to raise the ceiling on domestic insurers' overseas investments within the next three months.
"The decision is expected to be made by the end of June after a review by the Cabinet, and the proposal will be directed to the Legislative Yuan for review by the end of this year," Huang Tien-mu (黃天牧), the newly appointed director-general of the Insurance Bureau, said yesterday at a press conference.
Under the Insurance Law (保險法), local insurers can only appropriate a maximum of 35 percent of their working capital to invest in foreign markets.
Chen Wei-lung (陳惟龍), the bureau's deputy director general, said the bureau is discussing two proposals prepared by the Life Insurance Association of the ROC (人壽保險公會).
"The association suggested the government either raise the overseas investment ceiling from 35 percent to 50 percent, or not to include the proportion of the insurers' overseas hedge investment into the 35 percent limit," Chen said.
On Tuesday, the commission's vice chairman Lu Daung-yen (呂東英) said the commission and the central bank had reached a consensus on easing the limits on overseas investments, but he declined to give a timetable for the policy change.
According to the bureau's statistics, local insurers placed an average of 27.75 percent of their working capital in overseas investments as of the end of last year, with more than 80 percent of the capital put in hedge investments, 6 percent in the local bourse and the rest on other investment options, including real estate, bonds and exchequer bills.
Some life insurers, including Cathay Life Insurance Co (國泰人壽), Nan Shan Life Insurance Co (南山人壽) and Shin Kong Life Insurance Co (
Domestic insurers' working capital has surpassed NT$5 trillion (US$160 billion), and they will be able to divert, at most, NT$750 billion overseas, on top of the original amount of money, after the ratio is raised by 15 percentage points to 50 percent.
Nevertheless, Huang said the authorities are not worried about capital outflow or a negative impact on the domestic capital market.
He said it is not easy for insurers to liquidate their property investments and divert the money abroad in the short term. The US$82 billion worth of foreign capital inflow that goes mainly to the local bourse could make up for the amount of capital they may withdraw, he said.
Earlier yesterday, Huang formally replaced Mark Wei (魏寶生) as the bureau's director-general at a hand-over ceremony.
Wei said he decided to leave for "personal career plans," although he declined to say what he will do next. There has been intense speculation that he may join a foreign insurance company here.
Huang, 47, holds a doctoral degree in public administration from the University of Southern California. He was the Financial Supervisory Commission's first secretary-general after the Cabinet-level agency was established last July. Prior to that post Huang had worked at the Ministry of Finance's financial bureau.
Huang yesterday pledged to amend the Insurance Law (保險法), implement grading management of insurance products starting in July and help insurers set up new businesses for the new labor pension system.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) secured a record 70.2 percent share of the global foundry business in the second quarter, up from 67.6 percent the previous quarter, and continued widening its lead over second-placed Samsung Electronics Co, TrendForce Corp (集邦科技) said on Monday. TSMC posted US$30.24 billion in sales in the April-to-June period, up 18.5 percent from the previous quarter, driven by major smartphone customers entering their ramp-up cycle and robust demand for artificial intelligence chips, laptops and PCs, which boosted wafer shipments and average selling prices, TrendForce said in a report. Samsung’s sales also grew in the second quarter, up
LIMITED IMPACT: Investor confidence was likely sustained by its relatively small exposure to the Chinese market, as only less advanced chips are made in Nanjing Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) saw its stock price close steady yesterday in a sign that the loss of the validated end user (VEU) status for its Nanjing, China, fab should have a mild impact on the world’s biggest contract chipmaker financially and technologically. Media reports about the waiver loss sent TSMC down 1.29 percent during the early trading session yesterday, but the stock soon regained strength and ended at NT$1,160, unchanged from Tuesday. Investors’ confidence in TSMC was likely built on its relatively small exposure to the Chinese market, as Chinese customers contributed about 9 percent to TSMC’s revenue last
LOOPHOLES: The move is to end a break that was aiding foreign producers without any similar benefit for US manufacturers, the US Department of Commerce said US President Donald Trump’s administration would make it harder for Samsung Electronics Co and SK Hynix Inc to ship critical equipment to their chipmaking operations in China, dealing a potential blow to the companies’ production in the world’s largest semiconductor market. The US Department of Commerce in a notice published on Friday said that it was revoking waivers for Samsung and SK Hynix to use US technologies in their Chinese operations. The companies had been operating in China under regulations that allow them to import chipmaking equipment without applying for a new license each time. The move would revise what is known
UNCERTAINTY: A final ruling against the president’s tariffs would upend his trade deals and force the government to content with billions of dollars in refunds The legal fight over US President Donald Trump’s global tariffs is deepening after a federal appeals court ruled the levies were issued illegally under an emergency law, extending the chaos in global trade. A 7-4 decision by a panel of judges on Friday was a major setback for Trump, even as it gives both sides something to boast about. The majority upheld a May ruling by the Court of International Trade that the tariffs were illegal. However, the judges left the levies intact while the case proceeds, as Trump had requested, and suggested that any injunction could potentially be narrowed to apply
RSS