Investment losses at Taiwan’s major financial holding companies ballooned 50 percent to a combined NT$1.24 trillion (US$39.97 billion) in the third quarter, with the results attributed to a decline in the value of overseas and domestic investments due to interest rate hikes and stock market routs, Financial Supervisory Commission data showed.
Losses from overseas investments last quarter surged 37 percent quarterly to a record NT$905 billion, while losses from domestic investments expanded 103 percent to NT$338 billion, a level never seen before, the data showed.
The decline in value of investment targets held by the financial companies occurred as share prices tumbled in the third quarter amid interest rates hikes — which pushed up bond yields, but drove down their prices.
Local financial holding companies reported combined investment losses of NT$380 billion in the US last quarter, the biggest losses among all overseas markets, the commission’s data showed.
US losses were up 48 percent from the second quarter, while losses in China totaled NT$72 billion, while the figure was NT$42 billion in France, the data showed.
Despite the widening losses, local financial holding companies expanded overseas investments last quarter to NT$20.35 trillion, up 6.8 percent from a quarter earlier. Local financial holding companies’ investments in the US rose 8 percent to NT$7.25 trillion, accounting for 35 percent of total overseas investments, the data showed.
The increase could be attributable to rate hikes by the US Federal Reserve, which prompted local life insurers to seek newly issued fixed-income investments to earn higher yields.
China was the second-largest market for local financial companies’ overseas investments, although the total rose less than 1 percent quarterly to NT$1.34 trillion, the data showed.
Investments in other markets grew faster, with the UK rising 10.7 percent quarterly to NT$1.17 trillion, France expanding 9.2 percent quarter-over-quarter to NT$1.19 trillion and South Korea growing 7 percent quarterly to NT$721 billion, the data showed.
Semiconductor shares in China surged yesterday after Reuters reported the US had ordered chipmaking giant Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to halt shipments of advanced chips to Chinese customers, which investors believe could accelerate Beijing’s self-reliance efforts. TSMC yesterday started to suspend shipments of certain sophisticated chips to some Chinese clients after receiving a letter from the US Department of Commerce imposing export restrictions on those products, Reuters reported on Sunday, citing an unnamed source. The US imposed export restrictions on TSMC’s 7-nanometer or more advanced designs, Reuters reported. Investors figured that would encourage authorities to support China’s industry and bought shares
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said
CHANGING JAPAN: Nvidia-powered AI services over cellular networks ‘will result in an artificial intelligence grid that runs across Japan,’ Nvidia’s Jensen Huang said Softbank Group Corp would be the first to build a supercomputer with chips using Nvidia Corp’s new Blackwell design, a demonstration of the Japanese company’s ambitions to catch up on artificial intelligence (AI). The group’s telecom unit, Softbank Corp, plans to build Japan’s most powerful AI supercomputer to support local services, it said. That computer would be based on Nvidia’s DGX B200 product, which combines computer processors with so-called AI accelerator chips. A follow-up effort will feature Grace Blackwell, a more advanced version, the company said. The announcement indicates that Softbank Group, which until early 2019 owned 4.9 percent of Nvidia, has secured a
TECH SECURITY: The deal assures that ‘some of the most sought-after technology on the planet’ returns to the US, US Secretary of Commerce Gina Raimondo said The administration of US President Joe Biden finalized its CHIPS Act incentive awards for Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), marking a major milestone for a program meant to bring semiconductor production back to US soil. TSMC would get US$6.6 billion in grants as part of the contract, the US Department of Commerce said in a statement yesterday. Though the amount was disclosed earlier this year as part of a preliminary agreement, the deal is now legally binding — making it the first major CHIPS Act award to reach this stage. The chipmaker, which is also taking up to US$5 billion
RSS