trending Market Intelligence /marketintelligence/en/news-insights/trending/ulfvrgvo3kool8d24ouv7w2 content esgSubNav
In This List

Taiwan's financial watchdog sets draft rules for exchange-traded notes

Podcast

Street Talk Episode 87

Blog

A New Dawn for European Bank M&A Top 5 Trends

Blog

Insight Weekly: US banks' loan growth; record share buybacks; utility M&A outlook

Blog

Banking Essentials Newsletter 2021: December Edition


Taiwan's financial watchdog sets draft rules for exchange-traded notes

Taiwan's Financial Supervisory Commission released draft guidelines that will let securities companies issue exchange-traded notes, or unsecured structured products that combine aspects of bonds and exchange-traded funds.

This comes on the back of higher demand for more diversified investment products, amid the rapid globalization of financial markets, the regulator said in the Feb. 27 release.

It could take seven to eight months for brokerages to get their infrastructure ready to handle the new debt instruments, the Taipei Times reported Feb. 28, citing the FSC at a news conference.

To contain credit risks, the draft rules include the requirement that ETNs can only be issued by companies with a net value of more than NT$10 billion and a capital adequacy ratio of at least 250%.

Indexes or assets to be tracked by an ETN should also meet regulatory standards in terms of turnover, though such products will not be allowed to track the strength of the city's New Taiwan dollar.

The draft guidelines will be made available for public comment for 60 days from its publication, the FSC said.

As of Feb. 27, US$1 was equivalent to NT$29.30.