The Central Bank of Taiwan has published its 20th Financial Stability Report, covering domestic and international developments from early 2025 to April 2026. The report says Taiwan’s financial markets, institutions and payment infrastructures continued to operate smoothly and the financial system remained stable, while warning that changes in U.S. trade policy, geopolitical conflicts and higher market volatility could affect corporates, households and the real estate sector. Taiwan’s economy grew strongly in 2025, with annual GDP growth reaching a nearly 15-year high and inflation continuing to trend downward. Revenues of listed companies continued to rise and corporate financial structures remained sound, although profitability diverged across major industries. Household debt burdens decreased slightly, credit quality remained sound, and cooling real estate activity marginally eased mortgage burdens, while stock indices repeatedly hit record highs and bills and bond issuance and trading generally expanded. The report also notes record-high bank profits, sound asset quality and adequate capital, while life insurers recorded lower profits and lower average risk-based capital ratios with higher market risk exposure, and bills finance companies posted strong profit growth and sufficient capital but still faced elevated liquidity risks. The report says policy rates have remained unchanged since early 2025 and open market operations were used to manage banking system liquidity. The Central Bank of Taiwan also adjusted selective credit controls in March 2026, and a full English version of the report is due by the end of August 2026, with an executive summary released in the meantime.
Central Bank of Taiwan2026-05-29
Central Bank of Taiwan releases 20th Financial Stability Report saying financial system remained stable despite external risks
The Central Bank of Taiwan’s 20th Financial Stability Report finds markets, institutions and payment systems operated smoothly and the financial system stayed stable from early 2025 to April 2026, while warning of risks from U.S. trade policy shifts, geopolitical tensions and higher volatility. It cites strong 2025 GDP growth, rising listed company revenues, record bank profits and sound credit quality, but weaker life insurer profitability, elevated liquidity risks at bills finance companies and slightly lower household and mortgage burdens amid cooling real estate. Policy rates have been unchanged since early 2025, with liquidity managed via open market operations and selective credit controls adjusted in March 2026.