Taiwanese banks have slowed their pace in opening representative offices or branches in the countries included in the government’s New Southbound Policy (NSP), data released by the Financial Supervisory Commission (FSC) showed on Friday.
So far this year, only two local banks applied for and received approval to open outlets in New Southbound countries, the commission said.
In June, the FSC approved Chang Hwa Commercial Bank’s (彰化銀行) application to open a branch in Sydney, and in September it allowed E.Sun Commercial Bank (玉山銀行) to set up a representative office in Kuala Lumpur.
Photo: Chen Chih-chu, Taipei Times
While the commission in April approved Taipei Fubon Commercial Bank’s (台北富邦銀行) application to upgrade its representative office in Sydney to a branch, it was not considered a new outlet, the regulator said.
The New Southbound Policy aims to enhance trade and exchanges between Taiwan and 18 countries in Southeast and South Asia, as well as Australia and New Zealand, to reduce Taiwan’s dependence on China.
The policy was introduced after President Tsai Ing-wen (蔡英文) took office in 2016.
In response to the initiative, the commission in 2017 set a goal to encourage Taiwanese banks to open no fewer than three new representative offices or branches in the New Southbound countries each year.
In 2017, the commission approved applications from Taiwanese banks to set up 17 outlets in the 18 countries, and eight each year during the 2018-2020 period before falling to five in 2021 and one last year, FSC data showed.
From 2017 to last month, the commission approved the opening of 49 representative offices and branches in the 18 countries, it showed.
Regarding the drop in interest from local banks in setting up outlets in the countries, Banking Bureau Deputy Director-General Roger Lin (林志吉) said if no more banks apply to open branches by the end of this year to meet the commission’s target, it would consider changing the goal of opening three new outlets per year.
Asked whether the banking markets in the 18 countries have been so saturated that local banks had to scale back their expansion efforts, Lin said it was up to banks to judge the market conditions.
He said that how local financial institutions map out their expansion plans in foreign markets depends on economic activities, and bilateral trade and investments between the markets and Taiwan.
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