A slowing economy and the decline in electronics exports have hit the Taiwanese economy hard, and this is reflected in the banks’ Top 1000 World Banks performance. After a strong year in 2021, gross domestic product growth stalled at 2.43% in 2022, below the forecasted 3.06%. The economy contracted by 0.86% in the fourth quarter of the year as exports fell.
CTBC Bank remains Taiwan’s biggest bank by Tier 1 capital. However, it has fallen two places to 160th, due to a 2.78% contraction in core capital. It also only manages third place in the overall best-performing bank table, despite taking first place for growth and return on risk. The bank saw a 22.34% increase in pre-tax profits in 2022 and recorded the second-highest return on capital (ROC) ratio, of 11.13%, bested only by O-Bank (formerly Industrial Bank of Taiwan), which recorded an ROC of 20.23%.
Bank of Taiwan and Mega International Commercial Bank have held onto their second and third positions, respectively. Taipei Fubon Bank (TFB), which purchased Jih Sun International Bank, has climbed two places to fourth in the country ranking. However, this improvement is not reflected in TFCB’s Top 1000 placement and it remains in 190th spot.
Mega International Commercial Bank is crowned the best performer in 2023 among the largest 10 Taiwanese banks. This might come as some consolation to the bank, which saw its Tier 1 capital decline by 11.34%. It has table-topping results in profitability, operational efficiency, soundness and leverage.
TFB has risen to second in the over best-performing table from sixth in 2022. The bank takes first place for liquidity and second for soundness. At the other end of the table, E.Sun Commercial Bank has placed 10th in both the country ranking and the overall best-performing table. The bank recorded a 10.38% decline in Tier 1 capital, and has placed last for profitability, operational efficiency and return on risk.
Cathay United Bank (CUB), which was Taiwan’s fourth largest bank in 2022, has fallen to seventh place in 2023, with a drop of 11.14% in Tier 1 capital. The bank fared even worse in the best-performing table, falling to sixth place from first in 2022. It was particularly challenged in the leverage, asset quality and soundness categories.
CUB had a difficult year in 2022 and was hit with several fines by the Financial Supervisory Commission (FSC) for outages to some of its ATM, cash register and credit card network. The bank was fined NT$12m ($387,000) in December 2022, the highest ever fine meted out by the FSC. The bank’s president, Alan Lee, had his salary cut by 30% for three consecutive months.
