Taiwan’s Financial Supervisory Commission (FSC) is considering changing the method of calculating banks’ credit risk exposure in the mainland, Economic Daily News reported Monday, citing unnamed sources. The credit risk of some banks in the mainland has been close to the limit under current regulations, the report said. The FSC may adopt measures to help ease the risk, including allowing banks to book their investments in the mainland by choosing an accounting method that shows lower cost and using their net values that are the highest in recent quarters to be the basis of calculation rather than the numbers at the end of the previous fiscal year. Also, rules on calculating interbank loans may be loosened. Banks’ total exposure in the mainland, including credit loans and investment, cannot exceed 100 percent of their net values, the report said.
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