| Summary: | 碩士 === 國立臺灣大學 === 國家發展研究所 === 106 === China has seen a decline in its economic growth rate since the first quarter of 2010. Both domestic and foreign research institutions and economic scholars generally believe that China is now entering an economic transformation period, with an increasing pressure of downward adjustment in economic growth. The International Monetary Fund (IMF) points out in its research report “China and Asia in Global Trade Slowdown” that China is undergoing an economic restructuring period during which it will cause impact on its Asian neighbors and trade partners, especially on Taiwan which, due to its close integration with China in the global value chain, may suffer the hardest hit.
As of the end of 2017, Taiwan banks’ risk exposure in China amounted to NT$1.73 trillion. Lately, China has been encountering several problems such as bursting of real estate market bubbles, over supply of certain industries, worsening debt problems of local governments, increasing troubles of shadow banking system, as well as enterprises’ weakening solvency and higher risk of bankruptcy. All of these will influence the credibility of a certain group of Taiwan Banks’ clients such as China enterprises, Taiwanese enterprises operating in China, and those whose business is sensitively influenced by China’s economic performance.
This study takes both quantitative and qualitative approaches. In quantitative aspect, it collects information about the overall non-performing loans extended by Taiwan banks as well as their China-based subsidiaries, branches, leasing subsidiaries (including those of Taiwan financial holding companies), and offshore banking units (OBU), plus the secondary market information about China’s economic and financial market performance. Through empirical quantitative analysis, it examines the correlation between China’s economic and financial indicators and the non-performing loans extended by Taiwan banks as a whole. In qualitative aspect, it examines reasons behind the major default cases in China and makes classification of these cases, as supplementary analysis to make up the deficiency of quantitative analysis which, due to time limitation, may not be sufficient to fully explain how Taiwan banks’ non-performing loans change along with China’s economic and financial indicators. Finally, the study provides related risk analysis and recommends solutions as references of interested persons.
Major findings: through quantitative analysis, the study finds there are nine major China economic and financial indicators most sensitively linked to the changes in non-performing loans extended by Taiwan banks. Yet, this finding needs follow-up observation to examine their correlation during a longer period of time. Through qualitative analysis, it finds almost all the major default cases happen among the over-supply industries and banks fail to take cautions against clients from these industries. Some cases result from intentional defaulting of the clients with poor corporate governance. Meanwhile, banks may over rely on the credit arrange institutions and fail to fully examine client’s assets and financial conditions, understand their actual operations, or take any other proper actions for due diligence during the credit-checking procedures.
Key words: Economic and financial risks in China; China’s economic and financial indicators;Taiwan banks’ risk exposure in China; non-performing loans;default cases in China
|
|---|
