Ongoing turbulence in China has caused Taiwan’s biggest financial firm to flag risks in the mainland.
Fubon Financial Holding has been limiting its risk in China over the past few years during the pandemic and is now prepared for more challenges, according to a «Bloomberg» report citing president Jerry Harn.
«Don’t rush across the street when the yellow light is on,» Harn said, likening China’s property troubles to traffic lights. «China’s property distress will definitely impact Taiwan, as well as the global market if there are bigger and worse troubles.»
China Exposure
As of the end of June 2023, the Taiwanese firm’s total exposure to China was NT$277.5 billion ($8.7 billion), excluding strategic investments in China. Within the mainland, Fubon has owns a subsidiary bank in Shanghai alongside several joint ventures offering insurance and private consumer loans.
However, Harn noted that Fubon has no exposure to Country Garden and Zhongzhi Enterprise Group – the two headline firms facing liquidity crunches.
«If an economy as large as China is not doing well, it will definitely have global impact,» Harn added. «Uncertainties in the equity market are still relatively significant.»
