FSC chair approves positive rescue fund effects
Financial Supervisory Commission (FSC, ) Chairman Tseng Ming- chung ( ) stated his optimism about a stable Taiwan equity market yesterday should foreign stocks perform favorably as well, and announced financial measures to back up the Cabinet.
During a post- Cabinet meeting press conference, Tseng expressed his satisfaction with the positive impact of the National Stabilization Fund ( ) on the nation’s stock markets and in further earning investors’ trust in the market.
“The initial signs show that the funds have stabilized the market,” Tseng said. “U.S. stocks rallied on Wednesday at 619 points, and while China’s stocks opened low at approximately 30 points, it made a gradual comeback, rising at least 30 points to 60 points.”
Tseng also implied that Taiwan’s stocks will continue to remain steady should the U.S. and European markets perform well during trading on Thursday.
The chairman refuted media speculation that Taiwan’s closing performance on Wednesday, which showed only a rise of 39.95 points compared to an earlier 100-point rise, was due to trading from largecap stocks and that individual shareholders were taking advantage of rescue funds by making day trades.
Tseng stated that the weaker market performance was caused by sell-offs from foreign investors, who Tseng deemed were unlikely to conduct day trades. He also said there are no current plans to regulate day trading as of now. “Indi- vidual shareholders are unlikely to make huge trades as well,” Tseng said, further denying that the day trading system was exploiting the injection of rescue funds.
FSC Backs Up Cabinet with
The FSC also announced eight financial measures in conjunction with the Cabinet’s efforts aimed at rescuing the economy. Among the eight, the FSC pledged to provide loans totaling NT$500 billion, available for large enterprises as well as small and medium-sized enterprises (SMEs).
During the Cabinet meeting, Premier Mao Chi-kuo ( ) stated his optimism regarding the FSCproposed measures in helping to achieve the goal of the “industry assisting the financial system and vice versa.” Other measures include encouraging the insurance industry to invest more in public infrastructure, with investments for the year already reaching NT$160.2 billion by the end of June.
Industries that would benefit from the loan quota include the senior care sector. Mao encour- aged the FSC and the Ministry of Health and Welfare (MHW) to push for more insurance industry investment measures for the senior care market, which includes long-term care for the disabled, assisting sufferers of dementia as well as other service industries.
Measures are to be classified according to the need for amendments to the law, Mao stated. For measures that do not require amendments, Mao encouraged the FSC to inject more resources into industries providing basic necessities from clothing, food, accommo- dation and transportation as well as services for seniors aged 65 and above.
Another FSC- backed venture includes more proactively assisting the cultural and creative industries to obtain operational funding, aiming for an increase of NT$180 billion in loans in the next three years.
On assistance aimed at helping SMEs, the FSC also increased national banks’ loan quotas to NT$360 billion this year — an increase from the previous quota of NT$240 billion.