The average Tier 1 capital ratio for banks operating in Taiwan stood at 11.84 percent as of the end of September last year, Taiwan Ratings data showed. Taiwanese banks already scaled down their China exposure to about 4 percent of their total asset book before the outbreak, Lan said. Decreased China exposure had much to do with risk aversion on the part of Taiwanese banks amid the US-China trade dispute, she said. On the other hand, Taiwanese life insurers are more vulnerable to potential capital market shocks as the outbreak evolves, the ratings agency said. A material downturn in the equity market would weaken insurers’ capitalizations, which offer only a thin buffer against volatility, she said.
