The Financial Supervisory Commission (FSC) yesterday fined Cathay United Bank (國泰世華銀行) NT$2 million (US$68,622) and banned the lender from setting up new automatic teller machines (ATMs) as the bank’s ATM service malfunctioned several times recently, significantly affecting clients, the commission said.
The commission also raised the risk factor for Cathay United Bank in light of the recent incidents.
The bank must increase its capital by at least NT$750 million to keep its BIS capital adequacy ratio unchanged at 16.25 percent, Banking Bureau Chief Secretary Phil Tong (童政彰) told a news conference.
The bank could issue new shares or bonds to perform the cash injection, Tong added.
The bank, which operates 5,070 ATMs and ranks second among local banks in terms of the number of ATMs, had applied to the commission to set up 246 new machines this year, but the expansion would be suspended until the bank improves its ATM system, Tong said.
Only some ATMs proposed to be installed in remote areas would be allowed to be set up, he added.
Cathay United Bank’s ATMs have malfunctioned four times over the past six months, affecting 32,452 clients in the first two incidents in October last year, 2,015 in February and 732 people last month, the commission said.
The malfunctions occurred while the bank was updating its database, causing clients not to be able to transfer, withdraw or deposit money, Tong said.
Although the bank said that it had hired a contractor to update its database and was negotiating compensation with the company, it demonstrated poor internal control when dealing with the malfunctions, Tong said.
The bank did not properly evaluate whether a stress test was intense enough, nor did it set up an emergency plan for its call center, Tong said, adding that the bank did not notify the regulator quickly enough.
Among the fines levied on financial institutions for malfunctions in their information systems, Cathay United Bank’s fine was the second-highest after the NT$5 million fine on Citibank Taiwan Ltd (花旗台灣) in 2019, commission data showed.
However, Cathay United Bank was the first bank that was required to increase capital due to a malfunction, the commission said.
Previously, E.Sun Commercial Bank (玉山銀行) was asked to inject cash after its personnel stole money from clients, it said.
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
Greek tourism student Katerina quit within a month of starting work at a five-star hotel in Halkidiki, one of the country’s top destinations, because she said conditions were so dire. Beyond the bad pay, the 22-year-old said that her working and living conditions were “miserable and unacceptable.” Millions holiday in Greece every year, but its vital tourism industry is finding it harder and harder to recruit Greeks to look after them. “I was asked to work in any department of the hotel where there was a need, from service to cleaning,” said Katerina, a tourism and marketing student, who would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01
RSS