The nation’s structured credit market, which experienced a freeze in securitization activities last year, will continue to suffer from excess liquidity and low interest rates for the next two years, analysts at Fitch Ratings said yesterday.
“From a bank originator’s perspective, given that there is excess liquidity within the financial system, together with stagnant loan growth and low corporate impairment losses, there have been limited incentives for local banks to securitize their existing credit books,” April Chen (陳怡潔), associate director of the rating agency’s structured credit business, told a media briefing yesterday.
The market segment peaked at a volume of NT$230 billion (US$7.2 billion) in 2006 before dramatically declining to zero issuance activity last year, the agency said.
On the demand side, some local fixed-income investors, mainly insurance companies, retained their appetite for domestic corporate structured credit paper. This, however, was limited to very senior tranches with simple structures, she said.
Meanwhile, the nation’s real estate asset trusts (REATs) and real estate investment trusts (REITs) will maintain an outlook rating between “stable” and “negative”, pending their underlying properties, although their asset performance may lag behind the economic recovery, analyst Henry Hung (洪碩亨) told the same briefing.
NEW IDENTITY: Known for its software, India has expanded into hardware, with its semiconductor industry growing from US$38bn in 2023 to US$45bn to US$50bn India on Saturday inaugurated its first semiconductor assembly and test facility, a milestone in the government’s push to reduce dependence on foreign chipmakers and stake a claim in a sector dominated by China. Indian Prime Minister Narendra Modi opened US firm Micron Technology Inc’s semiconductor assembly, test and packaging unit in his home state of Gujarat, hailing the “dawn of a new era” for India’s technology ambitions. “When young Indians look back in the future, they will see this decade as the turning point in our tech future,” Modi told the event, which was broadcast on his YouTube channel. The plant would convert
Nanya Technology Corp (南亞科技) yesterday said the DRAM supply crunch could extend through 2028, as the artificial intelligence (AI) boom has led the world’s major memory makers to dramatically reduce production of standard DRAM and allocate a significant portion of their capacity for high-bandwidth memory (HBM) chips. The most severe supply constraints would stretch to the first half of next year due to “very limited” increases in new DRAM capacity worldwide, Nanya Technology president Lee Pei-ing (李培瑛) told a news briefing. The company plans to increase monthly 12-inch wafer capacity to 20,000 in the first half of 2028 after a
Property transactions in the nation’s six special municipalities plunged last month, as a lengthy Lunar New Year holiday combined with ongoing credit tightening dampened housing market activity, data compiled by local land administration offices released on Monday showed. The six cities recorded a total of 10,480 property transfers last month, down 42.5 percent from January and marking the second-lowest monthly level on record, the data showed. “The sharp drop largely reflected seasonal factors and tighter credit conditions,” Evertrust Rehouse Co (永慶房屋) deputy research manager Chen Chin-ping (陳金萍) said. The nine-day Lunar New Year holiday fell in February this year, reducing
Zimbabwe’s ban on raw lithium exports is forcing Chinese miners to rethink their strategy, speeding up plans to process the metal locally instead of shipping it to China’s vast rechargeable battery industry. The country is Africa’s largest lithium producer and has one of the world’s largest reserves, according to the US Geological Survey (USGS). Zimbabwe already banned the export of lithium ore in 2022 and last year announced it would halt exports of lithium concentrates from January next year. However, on Wednesday it imposed the ban with immediate effect, leaving unclear what the lithium mining sector would do in the
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