Notice of the Draft Amendment to the "Regulations Governing Foreign Bank Branches and Representative Offices" for Public Comments
2022-09-27
September 27, 2022
Notice of the Draft Amendment to the "Regulations Governing Foreign Bank Branches and Representative Offices" for Public Comments
The Financial Supervisory Commission (FSC) has proposed an amendment to Article 18 of the "Regulations Governing Foreign Bank Branches and Representative Offices" (hereinafter called “ the Regulations”) in order to set a suitable increase of the credit extension and investment capacity of foreign banks' branches in Taiwan based on the source of fund of their head offices and other overseas branches. The key points of the amendment are as follows:
1. With regard to the basis of calculation of total deposits of a foreign bank branch subject to mutatis mutandis application of Article 72 (limitations on total balance of medium-term loans) and Article 74-1 (restrictions on investments in securities) of the Banking Act, the term "actual drawdowns under credit lines from its head office" includes short-term loans of one-year or less received from the head office and shall additionally include short-term loans of one-year or less received from overseas branches of the head office. (Article 18, Paragraph 2 of the amended articles)
2. To facilitate the implementation of the aforementioned amendment, the FSC added requirements in Paragraph 3 to require foreign banks' branches to establish management mechanisms for the maturity and allocation of related assets and liabilities and liquidity risk management mechanisms. (Article 18, Paragraph 3 of the amended articles)
The FSC stated that the amendment of the Regulations is considered a proper adjustment designed to account for both the business development of foreign banks' branches and risk management. The proposed amendments will be published in the Executive Yuan Gazette, and, in addition, the FSC will post a general description along with a comparison chart of revised articles on its website. Anyone wishing to comment may visit the FSC website within 60 days after the date of the public announcement and submit comments by visiting FSC’s Laws and Regulations Retrieving System.
Contact unit: Foreign Banks Division, Banking Bureau
Telephone: (02) 8968-9783
If you have any questions, please send an email to:
https://fscmail.fsc.gov.tw
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923
Update:
2022-10-20