Central Bank of China

PRESS RELEASE Release Date: June 25, 2002




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Financial Conditions (May 2002)

Monetary Aggregates For the month of May 2002, the annual growth rates of the monetary aggregates M1A, M1B and M2, measured on a daily average basis, were 8.91%, 20.80%, and 4.29%, respectively. M1A and M1B growth continued to rise from the figures recorded in the previous month mainly because of the lower base of the corresponding month of the previous year. However, M2 growth went down mainly due to the decelerating growth of loans and investments, as well as the increasing demand for bond funds in place of bank deposits. In addition, the M2 aggregate plus bond funds held by the general public posted an annual growth rate of 6.61% for the month.

Deposits and Loans & Investments At the end of May, the annual growth rate of total deposits in major financial institutions, including monetary institutions and the Postal Savings System, fell to 3.71% from 4.41% at the end of the previous month. The growth of total loans and investments also declined from an annualized "1.92% at the end of the previous month to "2.13% mainly because of the government's repayments of loans for acquisition of land reserved for public facilities and the decrease in balance from banks' purchasing short-term bills. If loans and investments extended by life insurance companies and investment and trust companies, major financial institutions' reclassifying non-accrual loans and writing-off bad loans, as well as funds raised directly from financial markets were taken into account, the total funds raised by non-financial sectors showed an annual growth rate of 3.19% for the month.

Call-loan Rate and Reserve Conditions For the month as a whole, the fund condition in the banking system was still appreciably easy and the average free reserves of depository institutions and the Postal Savings System were NT$ 7 billion. The average overnight call-loan rate for the month declined from 2.265% in the previous month to 2.215%.

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