Shin Kong Financial Holding Co (新光金控) yesterday said that its insurance unit would adjust its investment portfolio after being banned from buying new stocks a day earlier by the Financial Supervisory Commission (FSC).
“We will research what we can do based on the commission’s specific instructions after we receive the regulator’s formal documents,” Shin Kong Financial spokesman Sunny Hsu (徐順鋆) told the Taipei Times by telephone.
The commission on Tuesday fined Shin Kong Life Insurance Co (新光人壽) NT$27.6 million (US$941,722) for reckless investment, and demanded that the insurer reduce its overseas investment ratio from 43 percent to 39 percent.
The fine would affect the insurer’s return on investment, but rising sales of foreign currency-denominated policies would help offset any negative effects, Hsu said.
Insurance companies are allowed to use foreign funds generated from their foreign currency-denominated policies to invest overseas without any restrictions, as there are no foreign exchange risks.
First-year premiums from foreign currency products totaled NT$32.24 billion for the first six months, making up 73.9 percent of all first-year premiums, the highest level Shin Kong Life has ever reported, company data showed.
The insurer cannot buy new local stocks until it lowers its overseas investment ratio, and Hsu said it remains unknown how long it will take for the ratio to drop to 39 percent.
Shin Kong Life had a pool of NT$3.02 trillion investment funds as of the end of June, with a recurring yield of 3.32 percent.
As Shin Kong Life chairman Eugene Wu (吳東進) was suspended by the commission on Tuesday, Shin Kong Financial chairman Victor Hsu (許澎) is to fill in for him as a board member, the insurer said in a filing to the Taiwan Stock Exchange (TWSE), adding that it has not yet appointed a new chairperson.
The commission on Tuesday also demanded that Shin Kong Life set up a better mechanism for its asset and liability management committee as it was responsible for the reckless investment decisions.
The committee did not hold meetings frequently and basically gave guidelines to the firm’s investment team, Hsu said, without saying whether it would be abolished or overhauled.
The commission’s press release announcing the Shin Kong Life fine reached more than 11,000 page views as of press time last night, a relatively high number for a government press release.
“All insurers are studying what mistakes Shin Kong made, trying to improve themselves to avoid a similar penalty,” Peng Jin-lung (彭金隆), chairman of National Chengchi University’s department of risk management and insurance, said by telephone.
As major insurance companies are running more internal committees to manage matters, the regulator is paying more attention to whether the committees’ power matches their responsibility and accountability, and whether companies have solid self-control measures in place, Peng said.
The commission’s regulations on insurance companies are likely to become more strict, as insurers have more money from the public and a bigger influence on capital markets, he added.
Taiwan will prioritize the development of silicon photonics by taking advantage of its strength in the semiconductor industry to build another shield to protect the local economy, National Development Council (NDC) Minister Paul Liu (劉鏡清) said yesterday. Speaking at a meeting of the legislature’s Economics Committee, Liu said Taiwan already has the artificial intelligence (AI) industry as a shield, after the semiconductor industry, to safeguard the country, and is looking at new unique fields to build more economic shields. While Taiwan will further strengthen its existing shields, over the longer term, the country is determined to focus on such potential segments as
UNCERTAINTY: Innolux activated a stringent supply chain management mechanism, as it did during the COVID-19 pandemic, to ensure optimal inventory levels for customers Flat-panel display makers AUO Corp (友達) and Innolux Corp (群創) yesterday said that about 12 to 20 percent of their display business is at risk of potential US tariffs and that they would relocate production or shipment destinations to mitigate the levies’ effects. US tariffs would have a direct impact of US$200 million on AUO’s revenue, company chairman Paul Peng (彭雙浪) told reporters on the sidelines of the Touch Taiwan trade show in Taipei yesterday. That would make up about 12 percent of the company’s overall revenue. To cope with the tariff uncertainty, AUO plans to allocate its production to manufacturing facilities in
COLLABORATION: Given Taiwan’s key position in global supply chains, the US firm is discussing strategies with local partners and clients to deal with global uncertainties Advanced Micro Devices Inc (AMD) yesterday said it is meeting with local ecosystem partners, including Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), to discuss strategies, including long-term manufacturing, to navigate uncertainties such as US tariffs, as Taiwan occupies an important position in global supply chains. AMD chief executive officer Lisa Su (蘇姿丰) told reporters that Taiwan is an important part of the chip designer’s ecosystem and she is discussing with partners and customers in Taiwan to forge strong collaborations on different areas during this critical period. AMD has just become the first artificial-intelligence (AI) server chip customer of TSMC to utilize its advanced
Chizuko Kimura has become the first female sushi chef in the world to win a Michelin star, fulfilling a promise she made to her dying husband to continue his legacy. The 54-year-old Japanese chef regained the Michelin star her late husband, Shunei Kimura, won three years ago for their Sushi Shunei restaurant in Paris. For Shunei Kimura, the star was a dream come true. However, the joy was short-lived. He died from cancer just three months later in June 2022. He was 65. The following year, the restaurant in the heart of Montmartre lost its star rating. Chizuko Kimura insisted that the new star is still down
RSS