Taiwanese banks, under increased scrutiny from the Ministry of Finance, are reviewing their participation in overseas syndicated loans amid growing signs of stress among mainland Chinese borrowers. The finance ministry last month instructed some state-owned banks to carefully review operating conditions, financial structures and leverage ratios before lending to overseas borrowers. It also asked them to ensure the coordinators or bookrunners retain final holds or large enough exposures to the borrowers before joining a lending syndicate. The focus on overseas loans comes after ZHAOHENG HYDROPOWER HOLDINGS and luxury car dealer CHINA ZHENGTONG AUTO SERVICES HOLDINGS both missed repayments on loans that were syndicated to Taiwanese lenders and led by investment banks that ended up with no exposure to the borrower. That has led the island's banks - the biggest retail investors in the Asian syndicated loan markets - to become more wary of their participation in offshore financings where the arrangers themselves are not long-term lenders.
展开▼
