The central bank yesterday set interest rates at 1 percent to 1.5 percent for funds to aid small and medium-sized enterprises (SMEs) hit by the COVID-19 pandemic, in an attempt to ward off a credit crunch.
The aid program, tentatively set at NT$200 billion (US$6.6 billion), as the monetary policymaker promised last week, would be available from April 1 and continue through the next 12 months to prevent cash-strapped firms from shutting operations and laying off workers, Department of Banking Director-General Chen E-dawn (陳一端) told a media briefing last night.
Central bank Governor Yang Chin-long (楊金龍) said on Thursday last week that the bank would meet with local financial institutions to work out lending terms in a timely manner.
Photo: Reuters
The liquidity injection and a rate cut of 25 basis points are the bank’s response measures to help local firms and households withstand the virus outbreak, which has wreaked havoc on airlines, travel agencies, hotels, retail stores and recreational facilities.
The bank caps borrowing costs at 1 percent for special loans of up to NT$2 million and no more than 1.5 percent for loans of up to NT$6 million, Chen said, adding that the program might go in conjunction with other government-backed relief and stimulus measures.
“Companies with cash needs may take out loans and lenders should be supportive to meet their social responsibility” at a difficult time, Chen said.
While the market remains awash with liquidity, the pace of growth has slowed, as money supply data released yesterday showed, the bank said.
The narrow money supply gauge of M1B, which refers to cash and cash equivalents, last month increased 7 percent from a year earlier, slowing from growth of 7.61 percent in January, the bank said.
The broad measure of M2, which includes savings deposits, time savings deposits, foreign-currency deposits and M1B, showed a similar trend, with a 4.35 percent pickup, compared with 4.6 percent in January, the data showed.
Capital flight from the local bourse and the New Taiwan dollar accounted for the slowdown, the bank said.
Savings deposits by foreign funds stood at NT$170.1 billion last month, the lowest since July 2017 following capital outflows of US$3.89 billion, it said.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Taiwan’s foreign exchange reserves fell below the US$600 billion mark at the end of last month, with the central bank reporting a total of US$596.89 billion — a decline of US$8.6 billion from February — ending a three-month streak of increases. The central bank attributed the drop to a combination of factors such as outflows by foreign institutional investors, currency fluctuations and its own market interventions. “The large-scale outflows disrupted the balance of supply and demand in the foreign exchange market, prompting the central bank to intervene repeatedly by selling US dollars to stabilize the local currency,” Department of Foreign
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
AI-FUELED DEMAND: The company has been benefiting from the skyrocketing prices for DRAM chips amid the AI frenzy, especially its core product — DDR4 DRAM chips DRAM chipmaker Nanya Technology Corp (南亞科技) yesterday reported that its revenue for the first quarter surged 582.91 percent to NT$49.09 billion (US$1.54 billion) from NT$7.19 billion a year earlier, as the supply crunch caused chip price spikes. Last quarter’s figure is the highest on record. On a quarterly basis, revenue jumped 63.14 percent from NT$30.09 billion, the company said. In January, Nanya Technology expected global DRAM supply scarcity to continue through the first half of 2028, thanks to strong demand for artificial intelligence (AI) applications. Market researcher TrendForce Corp (集邦科技) forecast prices of standard DRAM chips would rise between 58 percent and 63
RSS