Taiwanese financial holding companies increased their overall overseas exposure — including lending, investments and interbank transactions — to NT$27.38 trillion (US$845.69 billion) in the first quarter, data compiled by the Financial Supervisory Commission showed yesterday.
The 15 financial holding companies’ overall exposure in overseas markets at the end of March rose by NT$1.03 trillion from NT$26.35 trillion at the end of last year, as the firms increased overseas lending and beefed up their overseas investments, the commission said.
It said that first-quarter exposure was the highest in 36 quarters since such data started to be released in the second quarter of 2015.
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Financial holding companies’ top 10 markets for overseas exposure remained the same in the first quarter as the previous quarter. They were, in descending order: the US, China, the UK, France, Australia, South Korea, Hong Kong, Japan, Canada and the United Arab Emirates, the commission’s data showed.
In the first quarter, the companies raised their US exposure by NT$464.59 billion to NT$9.6 trillion, as they increased their investments in that market, the commission said.
Overall, their US exposure accounted for 35.08 percent of total overseas exposure, hitting a new high, it said.
The companies also saw their exposure to China rise to NT$2.21 trillion at the end of March, up from NT$2.19 trillion at the end of last year, as a decline in investment in China was offset by increases in lending and interbank transactions there, the commission said.
However, the ratio of their exposure to China compared with all overseas exposure dropped from 8.33 percent to 8.07 percent, an all-time low, it said.
Financial holding companies’ combined exposures to the UK, France, Australia, South Korea and Hong Kong were each above NT$1 trillion last quarter, while their combined exposure to Japan had been accelerating over the past few quarters and hit NT$987.63 billion at the end of March, the commission’s data showed.
The increase in exposure to Japan indicated a shift in companies’ appetite for the East Asian market following Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) launch of new wafer fabs early this year, the commission said.
TSMC expanding its footprint in Japan has prompted several Taiwanese banks, including E.Sun Commercial Bank (玉山銀行), Taishin International Bank (台新銀行) and Bank of Taiwan (臺灣銀行) to set up new branches or representative offices in Japan, the commission said.
Compared with the first quarter of last year, financial holding companies’ overall exposure to the US at the end of March increased the most year-on-year, by NT$1.12 trillion, followed by an increase of NT$169.12 billion in exposure to Australia and NT$129.89 billion to South Korea, it said.
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