Taiwan’s financial exposure in Russia, Ukraine hits US$8.2 billion

Taipei, Feb. 13 (CNA) In light of a potential conflict between Russia and Ukraine, Taiwan’s top financial regulator, the Financial Supervisory Commission (FSC), has assessed Taiwan’s financial risk exposure in both countries to be an estimated NT$229.171 billion (US$8.2 billion).

With the possibility of military conflict between Russia and Ukraine rising steeply, several countries like the United States and Japan have in the last few days implored their citizens to leave Ukraine.

Inflation would soon follow if all-out war breaks out between the two countries, which would disrupt the global market, analysts said.

As a result, the FSC recently conducted an assessment of Taiwan’s risk exposure in banking, insurance, and securities in the two countries.

Sector by sector

The FSC’s Banking Bureau said that as of the end of December 2021, loans from Taiwan’s 38 banks to Russia put their credit risk exposure at a total of NT$5.285 billion, while their credit exposure in Ukraine is at NT$6 million.

The FSC’s Insurance Bureau also revealed that although Taiwan has no risk exposure in insurance in Ukraine, the risk exposure in Russia is as high as NT$147 billion.

When it comes to risk exposure in securities, the FSC’s Securities and Futures Bureau said that while Taiwan does not have this issue in Russia and Ukraine, private investors are exposed to risks through acquiring securities and futures through domestic and overseas investment funds.

The bureau revealed that the risk faced by private investors using domestic funds to invest in Russia has been calculated at NT$21.4 billion, while the risk faced by those using overseas funds is NT$35.4 billion.

The risk exposure for private investors using domestic funds to invest in Ukraine has been calculated at NT$5.08 billion, while the risk faced by those using overseas funds is NT$15 billion.

Based on the aforementioned calculations, the FSC concluded that Taiwan is at a financial risk of NT$209.085 billion in Russia and NT$20.086 billion in Ukraine, which brings Taiwan’s risk exposure to NT$229.171 billion.

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