Taipei, Sept. 27 (CNA) The United States remained the largest debtor nation of Taiwan’s banking sector for the 40th consecutive quarter at the end of June after exposure to the U.S. market rose by more than 8 percent from a quarter earlier, according to the local central bank.
Data compiled by the central bank showed Taiwanese banks’ exposure to the U.S. hit US$194.87 billion as of the end of June, up US$14.80 billion or 8.22 percent from a quarter earlier.
Speaking with reporters, Hsieh Jen-chun (謝人俊), deputy head of the central bank’s Department of Financial Inspection, said on Friday that banks raised their deposits and interbank loans in the U.S. market and placed more investments in stock and bond mutual funds.
Meanwhile, China rose one notch to become the second largest debtor nation of Taiwanese banks at the end of June as exposure rose US$2.38 billion or 5.16 percent from a quarter earlier to US$48.50 billion at the end of the second quarter, the data showed.
Hsieh said the increase in exposure to China came as banks took advantage of a stronger Chinese yuan to invest in the Chinese bond market, while they also extended more interbank loans.
However, the gap between the exposure to the U.S. and China by Taiwanese banks continued to widen, hitting the largest-ever level of US$146.4 billion at the end of June, according to the central bank.
At the end of June, international claims by Taiwanese banks on a direct risk basis — comprising loans, investments, deposits and other holdings — rose by 5.57 percent from a quarter earlier to US$648.2 billion largely due to an increase in lending to nonbank firms, according to the data.
After the U.S. and China, Luxembourg ranked third at the end of June, down one notch from a quarter earlier with exposure by Taiwanese banks hitting US$48.06 billion, up 4.20 percent from a quarter earlier, followed by Australia (US$40.22 billion) and Japan (US$37.26 billion), the central bank said.
Rounding out the top 10 debtor areas were Hong Kong, with exposure of US$32.29 billion, the United Kingdom (US$22.11 billion), Singapore (US$19.02 billion), France (US$18.86 billion), Vietnam (US$16.84 billion) and South Korea (US$16.29 billion).
Exposure to the top 10 debtors totaled US$478.0 billion, accounting for 73.75 percent of the total international claims held by Taiwan’s banks at the end of June, the central bank said.