The risks of Taiwanese financial firms’ NT$1.12 trillion (US$35.12 billion) exposure to China are controllable, despite growing debt woes in the world’s second-largest economy, the Financial Supervisory Commission (FSC) said on Tuesday.
Concerns about debt contagion in China have risen after Zhongzhi Enterprise Group Co (中植企業), which managed about 1 trillion yuan (US$138 billion) of assets, this week missed payments on multiple high-yield investment products.
In addition, property giant Country Garden Holdings Co (碧桂園), which had racked up about 1.4 trillion yuan in liabilities as of the end of last year, and faces 7.8 billion yuan in payments on notes and bonds next month, on Monday suspended 11 of its onshore bonds.
Taiwan’s banking, insurance, and securities and futures industries have no exposure to Zhongzhi Enterprise Group, the commission said.
As for Country Garden Holdings, there are only 22 professional investors who are clients of five Taiwanese banks that have bonds issued by the Chinese property developer, totaling NT$170 million, while one local bank reported US$9.02 million in loans to the firm, the commission said.
As of the end of June, the three major financial industries reported aggregate exposure of NT$1.12 trillion to China, with the banking industry having a combined exposure of NT$1.01 trillion, followed by NT$94.7 billion by the insurance industry and NT$15.73 billion by the securities and futures industry.
In the banking industry, lending to China was NT$697.4 billion at the end of June, with investments in the Chinese market totaling NT$237.4 billion and interbank loans totaling NT$75.4 billion, the commission said, adding that total exposure to China accounted for 23.91 percent of the industry’s net worth.
Exposure to China in the local banking industry and the ratio of exposure to net worth dipped to the lowest level since the commission started recording the data in the third quarter of 2013, it said.
The declines were evidence that the risks from exposure remained controllable, it said.
In the insurance industry, exposure to Chinese marketable securities totaled NT$94.7 billion at the end of June, down 5.02 percent from a year earlier, with the investments all by life insurance companies, it said.
No investments were reported by property insurers, it added.
In the securities and futures industry, exposure totaled NT$15.73 billion as of the end of June, with investments by Taiwanese securities firms totaling NT$12.79 billion, the largest contribution in the industry, it said.
The exposure among securities firms was NT$3.88 billion in business investments and NT$8.9 billion from proprietary securities firms, it said.
In addition, exposure from securities investment trust firms and futures merchants was NT$2.69 billion and NT$251 million respectively, it added.
Taiwan Semiconductor Manufacturing’s (TSMC, 台積電) first wafer fab in Kumamoto, Japan is still set to launch commercial production in the fourth quarter of this year as planned, the world’s largest contract chipmaker said on Saturday in response to reports that mass production might begin ahead of schedule. TSMC said the monthly production capacity of the joint venture fab, Japan Advanced Semiconductor Manufacturing (JASM), is expected to hit 55,000 units of 12-inch wafers, using the mature 12-nanometer, 16-nanometer, 22-nanometer and 28-nanometer processes. JASM is owned by TSMC and its Japanese business partners Sony Semiconductor Solutions Corp and Denso Corp, with the Taiwanese company
US President Joe Biden’s administration is in talks to confer more than US$10 billion in subsidies to Intel Corp, people familiar with the matter said, in what would be the largest award yet under a plan to bring semiconductor manufacturing back to US soil. Intel’s award package is expected to include both loans and direct grants, the source said. They stressed that negotiations are still under way. The US Department of Commerce and Intel declined to comment. The incentives would come from the 2022 Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, which set aside US$39 billion in direct grants as
A new artificial intelligence (AI) tool that promises to create short videos from simple text commands has raised concerns along with questions from artists and media professionals. OpenAI, the creator of ChatGPT and image generator DALL-E, on Thursday said it was testing a text-to-video model called “Sora” that can allow users to create realistic videos with simple prompts. The San Francisco-based start-up said that Sora can “generate complex scenes with multiple characters, specific types of motion, and accurate details of the subject and background,” but added that it still has limitations, such as possibly “mixing up left and right.” Examples of Sora-created clips
Super Micro Computer Inc’s lengthy rally came to a shuddering halt on Friday, with a selloff that derailed what had looked to be the server maker’s best week on record. Shares fell 20 percent, their biggest one-day percentage drop since August last year. The decline comes in the wake of a nine-session run of gains, the longest such streak for the stock since 2016. However, even with the day’s selloff, the stock rose 8.5 percent for the week. Despite Friday’s drop, recent gains show how Super Micro has become one of the hottest names in artificial intelligence (AI). The stock has risen