Asia > Eastern Asia > Taiwan Area > The banker, Ho Shou-chuan, chairman of SinoPac Financial Holding,

Taiwan Area: The banker, Ho Shou-chuan, chairman of SinoPac Financial Holding,

2012/12/22

The banker, Ho Shou-chuan, chairman of SinoPac Financial Holding, made the remarks during a forum yesterday on opportunities after the setup of a cross-strait currency clearance mechanism.

He began his remarks by saying the proportion of banks' revenues to Taiwan's total gross domestic product has been on the decline over the past ten years.

He recalled in 2001 that banks' sales accounted for 7.9 % of total GDP. Last year, the figure dropped to 6.4 %, resulting from various factors including the world financial crisis and narrowing net interest margins, he said.

To change the situation, Taiwan should develop itself into an offshore renminbi center, he said.

“We have a significant trade surplus with China. The figure stood at US$89.8 billion last year,” he said. “There is definitely a huge potential for us to become an offshore renminbi center, whose contributions to local banks' earnings will be immeasurable.”

“The daily foreign exchange trade volume in Hong Kong is about 10 times that of Taiwan,” he added. “If Taiwan can reach half of that level, banks' earnings from foreign exchange processing fees will be huge, based on a rate of 0.135 %.”

He as well said that for the renminbi to become a major international currency, balances of payments in the currency must grow from the current 0.53 % to 10 %.

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