The central bank yesterday punished four foreign banks for helping grain merchants speculate in New Taiwan dollar-deliverable forwards in contravention of foreign-exchange regulations.
In a statement issued on its Web site, the central bank said it has revoked the Deutsche Bank Taipei branch’s licenses to trade NT dollar deliverable forwards and NT dollar non deliverable forwards.
The branch has also been banned from foreign-exchange derivatives transactions for two years, the statement said.
Photo: CNA
The central bank has banned the Taipei branches of ING Bank NV and Australia & New Zealand Banking Group Ltd from trading NT dollar deliverable forwards and NT dollar non deliverable forwards for nine months, it said.
Citibank Taiwan Ltd (花旗台灣銀行) has been suspended from NT dollar deliverable forward transactions for two months, it added.
The central bank said it on Friday notified the banks about the punishments, which are to take effect today.
The penalties came after the central bank said on Jan. 21 that eight grain merchants had engaged in currency speculation totaling US$11 billion since July 2019 with the help of branches and subsidiaries of six foreign lenders.
The activities were carried out under the guise of routine currency transactions, which were not in sync with their actual business needs, but affected the stability of the nation’s foreign-exchange market, the central bank said at that time.
“The branches and subsidiaries of six foreign banks in Taiwan have violated the related regulations on NT dollar deliverable forwards, but two of them stopped the questionable practices before the central bank’s special investigation,” yesterday’s statement said.
The central bank said it settled the case with the two unidentified lenders in November last year, as they had voluntarily stopped the questionable transactions and settled the unexpired positions soon after learning about the abnormality in the merchants’ financial reports and business situation.
Amid massive capital inflows, the NT dollar appreciated 5.6 percent against the US dollar last year. So far this year, the local currency has risen 0.41 percent against the greenback, but it has repeatedly challenged a 23-year high of NT$28 during intraday trading, the central bank’s data showed.
The central bank had opened the probe last year as part of its efforts to crack down on currency speculation amid rapid appreciation of the NT dollar.
It also asked custodian banks to exercise restraint in trades through moral persuasion and in a Facebook post urged the parties to maintain stable exchange rates.
The central bank’s latest effort to curb foreign-exchange speculation was announced on Wednesday, when it said it plans to revise foreign-exchange rules and cap foreign-currency settlements at US$50 million for companies and US$500,000 for individuals per year.
SECOND-RATE: Models distilled from US products do not perform the same as the original and undo measures that ensure the systems are neutral, the US’ cable said The US Department of State has ordered a global push to bring attention to what it said are widespread efforts by Chinese companies, including artificial intelligence (AI) start-up DeepSeek (深度求索), to steal intellectual property from US AI labs, according to a diplomatic cable. The cable, dated Friday and sent to diplomatic and consular posts around the world, instructs diplomatic staff to speak to their foreign counterparts about “concerns over adversaries’ extraction and distillation of US AI models.” Distillation is the process of training smaller AI models using output from larger, more expensive ones to lower the costs of training a powerful new
Shares of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) have repeatedly hit new highs, but an equity analyst said the stock’s valuation remains within a reasonable range and any pullback would likely be technical. The contract chipmaker’s historical price-to-earnings (P/E) ratio has ranged between 20 and 30, Cathay Futures Consultant Co (國泰證期) analyst Tsai Ming-han (蔡明翰) told Central News Agency. With market consensus projecting that TSMC would post earnings per share of about NT$100 (US$3.17) this year, supported by strong global demand for artificial intelligence (AI) applications, and the stock currently trading at a P/E ratio of below 25, Tsai said the valuation
The artificial intelligence (AI) boom has triggered a seismic reshuffling of global equity markets, with Taiwan and South Korea muscling past European nations one by one. With its stock market now valued at nearly US$4.3 trillion, Taiwan surpassed the UK, Europe’s biggest market, earlier this month, data compiled by Bloomberg showed. South Korea is about US$140 billion away from doing the same. The tech-heavy Asian markets have shot past Germany and France in the past seven months. The shift is largely down to massive gains in shares of three companies that provide essential hardware for AI: Taiwan Semiconductor Manufacturing Co (TSMC, 台積電),
The US Department of Commerce last week ordered multiple chip equipment companies to halt shipments of certain tools to China’s second-largest chipmaker, Hua Hong Semiconductor Ltd (華虹半導體), its latest action to slow the country’s development of advanced chips, two people familiar with the matter said. The department sent letters to at least a handful of companies informing them of restrictions on tools and other materials destined for two Hua Hong facilities US officials believe make China’s most sophisticated chips, the people said. Top US chip equipment companies Lam Research Corp, Applied Materials Inc and KLA Corp, each of which has significant
RSS