Taiwan banks’ pre-tax profits in May dip nearly 18% due to COVID-19

Taipei,  The total pre-tax earnings of Taiwanese banks in May declined by 17.8 percent year-on-year to NT$27.23 billion (US$924.88 million) due to the persistent effects of the COVID-19 pandemic on economic activity, the Financial Supervisory Commission (FSC) said Tuesday.

However, the banks’ offshore banking units (OBUs) and their branches in China saw their pretax profits grow by 3.4 percent and 35.6 percent, respectively, in May from a year earlier, according to data released by the FSC.

In Taiwan, profits posted in domestic banks’ banking units (DBUs) and their overseas branches in the month fell by 23.7 percent and 44.2 percent year-on-year, respectively, due mainly to the allocation of additional loan-loss provisions and declines in interest revenue and net profit from investing, the data showed.

For the first five months of this year, the aggregate pre-tax earnings at domestic banks stood at NT$13.86 billion, down NT$22.2 billion, or 13.8 percent, from the same period last year, according to the data.

Meanwhile, their DBUs contributed NT$80.54 billion to the total pre-tax earnings, down 17.8 percent year-on-year, while the pre-tax earnings posted in their overseas branches declined by 34.2 percent to NT$11.78 billion from a year earlier.

In contrast to the domestic situation, the banks’ OBUs and their Chinese branches posted 2.2 percent and 19.2 percent year-on-year growth in pre-tax earnings, respectively, according to the data.

As of the end of May, total loans extended by Taiwanese banks reached NT$30.62 trillion, up NT$242.1 billion from a month earlier.

Meanwhile, the banks’ overdue loans rose NT$1.2 billion from a month earlier to NT$74.9 billion, which translates into an overdue loan ratio of 0.24 percent, the same level as a month earlier and a year earlier, the FSC data showed.

 

Source: Focus Taiwan News Channel

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