TAIPEI (Taiwan News) — Financial exposure to China held by Taiwan’s banking, insurance, and securities sectors totaled NT$787.94 billion (US$25.02 billion) at the end of June, down 2.48% from a year earlier, according to Financial Supervisory Commission data.
Local banks accounted for NT$727.45 billion of the total, down 2.93% year-on-year, per Liberty Times. Their exposure as a share of net worth fell to a record low of 13.8%, 1.4 percentage points lower than a year earlier, mainly because investments in China fell more than 20%.
FSC Banking Bureau Deputy Director-General Chang Chia-kuei (張嘉魁) said banks remain cautious about China-related risks as economic growth slows and property risks increase, per CNA. Local banks have maintained a conservative approach to lending and investment, he said.
The insurance sector had NT$53.2 billion in exposure to China, up 6.61% from a year earlier and equal to 0.13% of its NT$39.6 trillion in total assets, per UDN. The exposure was held entirely by life insurers, with the increase from May mainly reflecting gains in Chinese stocks and a stronger Chinese yuan against the Taiwan dollar.
The securities, futures, and investment trust sectors had a combined China exposure of NT$7.29 billion, down 15% from a year earlier and equal to 0.73% of their net worth. Securities firms accounted for NT$4.5 billion, futures firms NT$95 million, and investment trust and consulting firms NT$2.69 billion.
FSC Securities and Futures Bureau Secretary-General Wang Hsiu-ling (王秀玲) said securities firms’ exposure rose NT$150 million in June as they increased their holdings of Chinese bonds. She said exposure was down NT$1.39 billion from a year earlier, mainly because securities firms reduced financial investments in their proprietary trading positions.
