Taiwan reforms lending and collateral rules 24 November 2015Taipei Reporter: Drew Nicol
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The Taiwan Stock Exchange (TSWE) has amended its operating rules to make more financial products available for lending.
The reformed ‘Operating Rules for Securities Business Money Lending by Securities Firms’ will mean more products can be loaned by brokers to investors and also expands the types of collateral that can be accepted as part of these loans.
The new amendments will come into force on 30 November.
Brokers are currently able to loan securities and commodities products such as TWSE-listed securities, general stocks listed on the Taipei Exchange (TPEx) and government bonds.
Under the new amendments, brokers will be able to lend open-end funds, futures funds, applications for shares in companies scheduled to list as an initial public offerings (IPO) or secondary public offerings (SPO) on TWSE or TPEx, municipal bonds, corporate bonds, financial bonds and spot gold products.
All of these products will also able to be used as collateral for loans except for the financing of IPO and SPO subscriptions for companies scheduled to list on TWSE or TPEx.
According to TSWE, the changes will enable brokers to offer more diverse services to investors who have been asking for more channels to access capital to invest in Taiwan’s financial markets.
It will also increase the global competitiveness of Taiwan’s brokers and support the further development of Taiwan’s capital markets and economy.
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