Peng Jinlong, chairman of the Taiwan Financial Supervisory Commission, announced at today's annual venture capital meeting that he will relax three major restrictions on venture capital investment in the "three banking and guarantee industries", especially for the insurance industry. He said that relevant measures will be announced soon, including in The capital adequacy ratio (RBC) risk coefficient for insurance industry investment and venture capital will be reduced within a certain amount, hoping to attract more financial funds into the venture capital field.

Peng Jinlong emphasized the importance of the financial industry supporting the development of venture capital

Peng Jinlong emphasized that economic development comes from industrial innovation, and the financial industry's investment in venture capital is crucial. At present, the financial holding and banking industries account for the highest proportion of investment in venture capital.

According to Article 36 of the Financial Control Law, financial holding companies can invest 100% in venture capital; the banking industry also listed venture capital as a related undertaking in 2017 and can become a 100% subsidiary, but must comply with the net worth of 3% and the entire group. Exceeds 15% of total specification. According to statistics from the Financial Supervisory Commission, from 2018 to 2023, investment in venture capital by financial holdings and banks increased from NT$54.4 billion to NT$79.6 billion, an increase of 46%.

Relaxation measures: Raising the investment limit

Peng Jinlong pointed out that the Financial Supervisory Commission has reached a consensus after the review and will adjust relevant measures according to different institutions and risks in the future. He mentioned that there is still a lot of room for venture capital investment by financial institutions. For example, the industry has proposed to increase the upper limit of 3% to 10%. The Financial Supervisory Commission will consider expanding the scope based on actual needs. In addition, the Financial Supervisory Authority will make rolling adjustments to whether the simple upper limit of 150 million yuan can be raised to 500 million yuan. Although it will not be adjusted immediately, it will be seriously considered.

Investment restrictions on securities, futures and investment banking industries

The securities and futures industry invests relatively little in venture capital, with investment amounts limited to 40% of net worth, and non-securities-related investments limited to 20%. The investment banking industry also has a 40% limit. According to statistics from the Financial Supervisory Commission, from 2017 to 2024, the amount of investment in venture capital by the securities and investment trust industries increased by 32%.

Regarding the relaxation of investment restrictions in sustainable venture capital businesses, Peng Jinlong said that this part has been submitted to the exchange and the over-the-counter buying center for discussion. The Securities and Futures Bureau will discuss with the exchange whether to relax the existing 20% ​​limit, and the Financial Supervisory Commission will also prudently Consider further loosening measures.

New Strategies for Insurance Industry Investment and Venture Capital

In terms of investment in venture capital in the insurance industry, the Financial Supervisory Commission also hopes to increase investment. Peng Jinlong pointed out that in order to encourage the insurance industry to invest in infrastructure, the Financial Supervisory Commission has adjusted the investment risk accrual standards of the insurance industry and will further adjust the risk coefficient in the future. Statistics show that from 2020 to June this year, the insurance industry's investment in venture capital increased by 13.75%, with the investment amount increasing from 2020 to NT$27.3 billion in the first half of this year.

Currently, the RBC risk coefficient for the insurance industry's investment in venture capital is as high as 35%, and it is expected to increase to 49% after 2026 in response to the new international system. This may suppress the insurance industry's willingness to invest in venture capital. In order to solve this problem, the Financial Supervisory Commission plans to reduce the risk coefficient within certain quotas to attract more insurance funds to flow into venture capital.

Peng Jinlong: Building Taiwan into an Asian asset management center

Peng Jinlong emphasized that the Financial Supervisory Commission’s goal is to build Taiwan into one of Asia’s asset management centers, in which venture capital plays a key role. He said that when promoting the development of the financial market, the Financial Supervisory Commission will take safety as its primary consideration, and on the premise of controllable risks, encourage the financial industry to increase support for venture capital, provide solid financial backing for new industries, and further promote economic development.

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