Bank Industry Risk Analysis: Taiwan Jun 02

Standard & Poors, June 2002

Abstract
The industry risk for the banking sector of Taiwan (Republic of China)(AA/Negative/A-1+) appears satisfactory but the outlook remains negative due to increasing structural challenges. The sector is supported by its adequate aggregate balance sheet, particularly in terms of liquidity and capitalization. In addition, a degree of implied government support for big policy banks, which dominate the system, remains a favorable factor. These strengths, however, are partially offset by a recent slowing of economic growth, heightened competition, and increasingly poor financial measures, with the latter mainly due to deteriorating asset quality. The risk profiles of Taiwan's banks accordingly remain mixed. The leading 13 domestic banks, which control two-thirds of the island's banking assets, mostly have adequate capacity to meet their financial...

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Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.

- The Royal Bank of Scotland N.V.
- Citibank N.A.
- The Hongkong and Shanghai Banking Corp. Ltd.
- Taiwan (Republic of China) (Unsolicited Ratings)
- JPMorgan Chase & Co.
- Chiao Tung Bank
- Bank of Taiwan
- Chinatrust Commercial Bank
- First Commercial Bank Ltd.
- Hua Nan Commercial Bank Ltd.
- Fubon Insurance Co. Ltd.
- China Development Industrial Bank
- Farmers Bank of China
- Taishin International Bank Co. Ltd.
- E.SUN Commercial Bank Ltd.
- Shinkong Insurance Co. Ltd.
- Cathay Life Insurance Co. Ltd.
- Fubon Financial Holding Co. Ltd.
- Taiwan Business Bank
- Cathay Financial Holding Co. Ltd.
- China Development Financial Holding Corp.
- Yuanta Securities Finance Co. Ltd.

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