FSC’s Important Measures to Raise Financial Competitiveness
A. Results of Various Measures
- Adopting of a “negative list” for OBU products; all products are, in principle, liberalized:
In line with the “Free Economic Pilot Zone” policy, the “negative list” approach has been adopted for OBU business. Except for complicated credit-type derivatives which are subject to approval, all others are, in principle, liberalized.
- Allowing securities firms to set up OSU
a. Permissible products: off-shore issued and traded securities, foreign currency-denominated OTC derivatives (including bonds, funds), foreign futures, and Taiwan stock related products, etc.
b. As of December 2014, 17 securities firms had obtained OSU licenses.
- Expanding DBU business
Taking into account the suggestions of financial companies, the FSC has compared our regulations with Singapore and Hong Kong, and has eased 22 regulations.
- Financial import substitution
Our financial institutions have invested over NTD 10 trillion in foreign financial products. Applying the policy concept of financial import substitution, the FSC hopes these investment transactions can be done in Taiwan.
- Deploying financial businesses actively in Asia
a. In light of the arrival of the Asian era, the FSC has actively encouraged our financial industries to expand their business presence throughout Asia, in order to expand market space for our financial services.
b. By taking four measures (i.e., de-regulation, supervisory cooperation, talent cultivation, establishment of data bases), the FSC will assist our banks in enlarging their markets overseas.
- Making/amending of five financial acts
a. Making of Electronic Payment Processing Institutions Act
b. Amendment to the Banking Act
c. Amendment to the Offshore Banking Act
d. Amendment to Insurance Act
e. Amendment to Financial Consumer Protection Act
B. Steady Growth of Financial Industries
1. Banking Industry: Record high profits; improved ROA & ROE
-- The total profits of our banks reached a record high of NTD 271.9 billion in 2014, with a growth rate of 25% compared with 2013. Rate on asset and rate on equity were 0.79% and 11.65% respectively.
2. Securities Industry: Increased profits
-- Profits before tax reached NTD 34.338 billion in 2014, a 48.17% increase on NTD 23.174 billion in 2013.
3. Insurance Industry: Profits set a record high
-- Profits before tax reached NTD 127.6 billion in 2014, a 62.34% increase on NTD 78.6 billion in 2013.
C. Future Prospect
The FSC will implement the principle of “two pronged supervision.” On one hand, we will emphasize the importance of risk-control and integrity. On the other, we will continue liberalization and innovation of our financial industries. In so doing, we can ensure balanced growth of the financial market and sustainable operation of businesses, as al establishing a forward-looking and sound financial system.