Page 7 - 中央存保108年年報

In 2019, negative factors such as the US-China trade war, Brexit, and geopolitical instability resulted in continued slowing of global trade activity and economic growth. Fortunately, Taiwan benefited from the US-China trade war as overseas buyers switched orders to Taiwan-based suppliers. Taiwan-invested firms in China returned to invest in Taiwan, and semiconductor manufacturers increased their spending on capital equipment in Taiwan. These and other factors have spurred an ongoing expansion of economic activity in our country. The Taiwan government, in order to meet the need for industrial development and transformation, has carried out legislative amendments and deregulatory measures, and implemented a number of different financial policies. These latter include: allowing the establishment of internet-only banks; expanding the use and innovation of mobile payments; developing a digital financial environment; ensuring that financial reports in Taiwan are prepared in accordance with the International Financial Reporting Standards; promoting risk- based internal audit systems; strengthening the ability of financial institutions to safeguard information security; pushing financial institutions to establish specialized cyber security units; promoting financial literacy; and better protecting the interests of financial consumers. Such undertakings are intended to ensure safe and sound operations at financial institutions, spur the upgrading and development of financial industries, and strengthen the international competitiveness of Taiwan's financial institutions.
As Taiwan's sole provider of deposit insurance, the Central Deposit Insurance Corporation (CDIC) is charged with the dual responsibility of maintaining financial stability and safeguarding the interests of depositors. In 2019, the CDIC continued to execute its duties aligned with the supervisory policies of the Financial Supervisory Commission (FSC), the competent authority for Taiwan's financial sector, and to handle the tasks entrusted by the FSC. These tasks included utilization and management of the Financial Industry Special Reserve Fund, as well as carrying out closer monitoring of domestic banks' risk exposures overseas (including countries targeted by the Taiwan government's New Southbound Policy) and in mainland China, as well as risks arising from banks' handling of OTC derivatives and domestic structured products. The objective was to effectively fulfill the function of deposit insurance in maintaining financial stability. In addition, the CDIC has also been implementing new methods of collecting data information in order to improve supervision of liquidity at internet-only banks.
Taiwan is easily impacted by international economic and financial market conditions, so the CDIC, in addition to controlling the insured risks of insured institutions, also uses the National Financial Early-Warning System (NFEWS) and the Account Officer System to carry out risk-based off-site monitoring in order to dynamically adjust and enhance risk control operations. By doing so, the CDIC actively plays its role as a risk minimizer. Also, in order to bolster the deposit insurance protection and strengthen its risk-bearing capacity, the CDIC this year continued replenishing its Deposit Insurance Payout Special Reserves, and conducted campaigns to raise public awareness of the deposit insurance system. At the same time, in the capacity of either conservator or receiver, the CDIC continued maintaining social fairness, justice, and the interests of the national treasury by disposing of the retained
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中央存保一〇八年報
Message from the Chairman and President
2019 Annual Report