The latest review on state-run banks’ exposure to US Treasuries and their internal risk management measures found no major issues, a Ministry of Finance official said yesterday.
The ministry last month asked nine state-run banks to report their exposure to US government bonds, risk management mechanisms and protocols, in response to public concerns over US assets.
So far, there were no major issues with the Treasuries exposures of the banks that would require authorities to take further measures, a ministry official, who spoke on condition of anonymity, said by telephone.
Photo: Chiang Ying-ying, AP
The ministry has not conducted any additional reviews since last month and has no plans for more reviews or for there to be regular checkups, the official said.
The comments came in response to a report by the Chinese-language Commercial Times yesterday, which said the ministry had asked state-run banks to adjust US bond portfolio allocations and lower their exposures if market concerns intensify.
Markets have been whipsawed by growing uncertainty over economic prospects after US President Donald Trump unveiled steep trade tariffs last month. The New Taiwan dollar has surged against the greenback in the past month, raising concern over the exposure to US dollar assets.
The state-run banks collectively hold about NT$340 billion (US$11.26 billion) in US government bonds, the Commercial Times said.
Chang Hwa Commercial Bank Ltd (彰化商業銀行), Hua Nan Commercial Bank Ltd (華南商業銀行), Mega International Commercial Bank Co (兆豐國際商業銀行) and Land Bank of Taiwan Co (臺灣土地銀行) are among the institutions holding the highest proportion.
In the middle of last month, a legislator voiced concern about local exposure to US Treasuries amid growing tariff and market uncertainty. In a statement late last month, the Ministry of Finance said state-run banks should adjust holdings to control risks if market concerns intensify, after it had completed a round of reviews.
The authority has asked the banks to actively manage and adjust their US government bond exposure following their internal protocols and mechanisms, the official said, adding that it would continue to closely monitor the situation and make adjustments accordingly.
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