Financial Conditions (September 2005)

Monetary Aggregates For the month of September 2005, the annual growth rates of the monetary aggregates M1A, M1B, and M2, measured on a daily average basis, were 7.07%, 6.31%, and 6.35%, respectively. All of these growth rates were lower than those recorded in the previous month mainly due to net foreign capital outflow and overseas remittance by local residents. After adjusting for the sale of its trust business by the Taiwan Development and Trust Corporation (TDTC) to a domestic bank as a result of regime change, the growth rate of M2 was 6.30%. For the first nine months of this year, M1A, M1B, and M2 exhibited average annual growth rates of 8.08%, 7.55%, and 6.17%, respectively.
Reserve Money The daily balance average of reserve money in September was NT$1,787.2 billion, a decrease of NT$4.7 billion from the previous month. Currency in circulation increased by NT$3.7 billion, while reserves deposited with the Bank decreased by NT$8.4 billion. The annual growth rate of the daily balance average of reserve money in September was 7.57%, falling by 1.20 percentage points from 8.77% in the previous month.
Direct and Indirect Finance At the end of September, the annual growth rate of total outstanding loans and investments of major financial institutions, including monetary institutions, the Chunghwa Post Co., as well as money market mutual funds, rose from 7.42% at the end of previous month to 8.24%. This was mainly due to an increase in bank claims on the private sector. After adjusting for the sale of its trust business by the TDTC to a bank, the growth rate was 8.17%. If (1) loans and investments extended by life insurance companies and investment and trust companies, (2) non-accrual loans reclassified and bad loans written-off by major financial institutions, and (3) funds raised directly from capital markets were all taken into account, the total outstanding amount of funds raised by non-financial sectors showed an annual growth rate of 7.43%, higher than the 6.90% posted in the previous month.
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Notes:
1. The upcoming Financial Conditions (October 2005) is scheduled for release at 16:20 on November 25, 2005.
2. For the release schedule for the next six months, please check the CBC website at http://www.cbc.gov.tw/EngHome/ESSDS/calacal.htm.