Citigroup Inc posted record client revenue in Taiwan last year, fueled by a surge in fundraising from technology companies despite intensifying competition from rival investment banks.
The “eye-catching” performance of the bank’s investment banking division helped propel its Taiwan operations, while activity in other sectors such as stock trading also strengthened, Citigroup’s Taiwan country officer Christie Chang (張聖心) said.
“The current trend of local companies seeking funding from foreign investors is the strongest we’ve seen in a decade,” Chang said in an interview on Monday in Taipei.
Photo courtesy of Citibank Taiwan Ltd
The capital markets activity is driving bank expansion in Taiwan even amid heightening geopolitical tensions with China. Local chipmakers and hardware providers are aggressively tapping overseas markets as global demand for artificial intelligence (AI) components surges.
Share sales by Taiwanese tech firms to foreign investors have jumped over the past two years. Equity-linked offerings, including convertible bonds and global depositary receipts, raised more than US$5 billion last year following a US$6.6 billion haul a year earlier, according to data from Dealogic and the Taiwan Stock Exchange.
Almost every deal from Taiwan has been oversubscribed by foreign investors — primarily large global funds and some hedge funds seeking long positions — as they look to build exposure to the nation’s technology champions, Citigroup said.
“Foreign investors previously had limited allocation to Taiwan names, but the recent jump in deal activities provides a rare entry point to add Taiwan to their books,” Chang said.
The push is drawing intense competition in the financial industry. Global banks that once paid limited attention to Taiwan have rushed in, often undercutting rivals with aggressive pricing to win deals and increase their market share, she said.
Citigroup helped arrange some of the biggest Taiwan deals last year, including two convertible bond sales worth about US$1 billion for leading AI server suppliers Quanta Computer Inc (廣達) and Wistron Corp (緯創).
Beyond technology, the need for local insurers to raise debt to meet a more stringent regulatory regime has created new opportunities.
Citigroup has raised more than US$30 billion for Taiwanese clients since 2020 from global capital markets to support their growth.
Geopolitical uncertainty has driven further overseas expansion for Taiwanese firms, as other countries grow wary of semiconductor production being overly concentrated in the nation.
“Many companies are already pursuing overseas M&A [mergers and acquisitions] to strengthen their AI capabilities,” Citigroup Global Markets Taiwan Securities Co (花旗環球證券) chairman Laura Chen (陳詩韻) said in the same interview.
The US lender has not lowered its internal targets for Taiwan despite geopolitical risks often mentioned by others, Chang said.
Massive AI-related data center investments continue to flow into Taiwan, driving demand for foreign exchange services and access to local liquidity, she said.
“From a business perspective, the demand remains very real and I don’t feel it being impacted by geopolitical risks at all,” Chang said.
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