Taiwan’s Financial Supervisory Commission is taking steps to reduce the burden of life insurers’ foreign-exchange hedging costs, which have risen because of the wide gap between local and US interest rates.
The island’s insurers will be allowed to apply to increase FX volatility reserves from other reserve pools, the FSC’s Insurance Bureau Deputy Director General
The changes will effectively boost insurers’ forex hedging reserves to as much as NT$960 billion ($30.1 billion), from the current level of as much as NT$300 billion, according to Tsai. This will reduce their need for ...