Fitch relies on Downgrade Watch after the currency

The Tokyo (Reuters) credit rating agency Fitch checked five Taiwanese life insurers for potential downgrades on Thursday after a strong increase in the Taiwanese dollars emphasized their balance sheets this month.

Fitch has Cathay Life Insurance, Fubon Life Insurance, KGI Life Insurance, Nan Shan Life Insurance and Taiwan Life Insurance for “Rating Watch Negative” due to the “Significant Mismatching” -” -Studation through their” considerable “US dollar -Holdings in a press release about” Watch Negative “.

“While insurers have deviated a large part of their balance sheet defects, we believe that this strategy will be under pressure due to the increase in securing costs, and they will continue to suspend sharp currency fluctuations,” said Fitch.

“The potential for further appreciation for Taiwanese dollars remains.”

At the beginning of this month, Taiwan's dollar experienced an unprecedented increase of 8%, in which the postulate for the analysts in the American US American investments was used. With confidence in the US dollar, which was clouded by President Donald Trump's trade war, and as speculations that the US Taiwan Taled negotiations could involve an agreement to weaken the greenback.

Fitch estimates that the insurers have sufficient capital buffers to withstand an increase in the Taiwan dollar by 10% compared to the US dollar from the beginning of 2025. The local currency has currently increased by around 8.8% this year.

The evaluation agency said that you are expecting the reviews to solve the reviews in the next three to six months.

(Reporting by Kevin Buckland; Editor of Michael Perry)