Since 2020, the COVID-19 pandemic has seriously affected financial stability in Taiwan and throughout the world. To encourage domestic banks to keep developing financial intermediary functions and supporting enterprises and individuals with funding needs, the FSC, after convening a video conference with six domestic systemically important banks (D-SIBs), has decided to defer the implementation of "Basel III: Finalizing post-crisis reforms" by one year, and the 2% additional internal capital requirement that D-SIBs must meet has also been postponed by one year, in order to ensure that domestic banks will be in a position to support real economic activity.
As of end-March 2021, the average common equity ratio, tier 1 capital ratio, and capital adequacy ratio of the domestic banks were 11.85%, 12.81%, and 14.77%, respectively, which shows that domestic banks have sufficient capital adequacy and sound risk bearing capabilities under the stress scenarios adopted for the supervisory stress test results in 2021. To balance the sound risk management of domestic banks and relief measures to support the economy, the FSC has adopted the aforementioned prudential supervision measures to lower banks' capital requirements and release internal resources that have enabled banks to respond to the pandemic, continue to support the needs of enterprises and individuals, and keep developing their financial intermediary functions. The FSC will continue to supervise the risk management of domestic banks, and maintain a resilient and well-functioning financial system.