Union Bank of Taiwan (聯邦銀行) has a cautious view about the housing market for the rest of this year, as prices increase and developers release new projects.
The Taipei-based lender on Tuesday said it would prefer to wait and see in dealing with mortgages, regardless of the ongoing property boom.
Housing transactions in the six special municipalities in the first seven months spiked 28.5 percent from the same period last year, helped by a robust economic recovery, a stable job market and wealth inflation linked to the local bourse.
Photo: Lee Chin-hui, Taipei Times
The conservative approach has much to do with its longstanding mortgage policy and concern over its risk-based capital, the bank told an online investors’ conference.
The housing market has been booming for a year since the government in August last year introduced favorable lending terms for first-home purchases, including interest subsidies, a five-year grace period and mortgages of up to 40 years, the bank said.
The central bank in June announced measures to tighten lenders’ reserve requirement ratio by 25 basis points to prevent too much money flowing to the real-estate market. In addition, it lowered the loan-to-value cap from 70 percent to 60 percent for second-home mortgages in the six special municipalities, as well as in Hsinchu city and county.
At the same time, the Ministry of Finance asked state-run banks to implement more thorough reviews for first-home mortgage applications to root out dummy buyers and investors.
That backdrop is driving up the risks of house loans and Union Bank has to respond, it said.
The bank also called attention to developers offloading unsold houses in batches, which would considerably increase the supply of houses.
The bank said it emerged unharmed from the stock market rout on Monday, even though local shares constitute the bulk of its investments in equities, thanks to its investments in US bonds.
Those investments would reap further rewards should the US Federal Reserve cut interest rates later this year, it said.
Union Bank’s net profit grew 9.28 percent to NT$2.73 billion (US$83.53 million) in the first half of the year, as fee income rose 6.38 percent while net interest income declined 6.93 percent, the bank said.
The results translated into earnings per share of NT$0.55, a 3.77 percent uptick from a year earlier.
The bank said it aims to strengthen its credit card business, and its has lowered hurdles for cardholders to win bonuses and benefits.
Card spending in the first half was up 30 percent from a year earlier and the card activation rate climbed to 65 percent, making the bank the fifth-best performer in the nation, it said.
Shares of contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) came under pressure yesterday after a report that Apple Inc is looking to shift some orders from the Taiwanese company to Intel Corp. TSMC shares fell NT$55, or 2.4 percent, to close at NT$2,235 on the local main board, Taiwan Stock Exchange data showed. Despite the losses, TSMC is expected to continue to benefit from sound fundamentals, as it maintains a lead over its peers in high-end process development, analysts said. “The selling was a knee-jerk reaction to an Intel-Apple report over the weekend,” Mega International Investment Services Corp (兆豐國際投顧) analyst Alex Huang
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is expected to remain Apple Inc’s primary chip manufacturing partner despite reports that Apple could shift some orders to Intel Corp, industry experts said yesterday. The comments came after The Wall Street Journal reported on Friday that Apple and Intel had reached a preliminary agreement following more than a year of negotiations for Intel to manufacture some chips for Apple devices. Taiwan Institute of Economic Research (台灣經濟研究院) economist Arisa Liu (劉佩真) said TSMC’s advanced packaging technologies, including integrated fan-out and chip-on-wafer-on-substrate, remain critical to the performance of Apple’s A-series and M-series chips. She said Intel and Samsung
POWER BUILDUP: Powered by Nvidia’s B200 Blackwell chips, the data center would support MediaTek’s computing power demand and business growth, the company said Smartphone chip designer MediaTek Inc (聯發科) yesterday launched a new artificial intelligence (AI) data center with a maximum capacity of 45 megawatts to meet its rising demand for computing power required to develop new advanced chips for AI applications. The company has completed the first-phase computing power buildup at the data center in Miaoli County’s Tongluo Township (銅鑼), providing 15 megawatts of capacity to support its research and development (R&D) capabilities, despite an industrywide shortage of key components, MediaTek said. Supply constraints have plagued a wide range of key components, including memory chips, solid-state drives, power supply units and central
IMAGE SENSORS: The Japanese company would be the controlling shareholder of the venture, with development and production lines to be set up in Kumamoto Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it has signed a non-binding memorandum of understanding (MOU) with Sony Semiconductor Solutions Corp to create a joint venture to develop and produce next-generation images sensors. The partnership seeks to explore and address emerging opportunities in physical artificial intelligence (AI) applications, such as automotive and robotics, paving the way for innovations and expanded technological advancements, TSMC said in a statement. Sony would be the majority and controlling shareholder of the joint venture, the statement said, adding that the company would set up development and production lines in its newly constructed fab in Kumamoto Prefecture’s
RSS