"A Deposit Surge Pushes Taiwan's Domestic Banks' Balance Sheet to Records at Both Ends: lending posted a record monthly increase of NT$707.7 billion in March and deposits a record single-month increase of NT$1.0554 trillion in April, the loan-to-deposit ratio of 72.56% is a near-6-year high, and Q1 pre-tax profit of NT$174.28 billion is a same-period record—yet only the China-branch profit fell 3.2% year-on-year, while funds flowed first into the six core strategic industries such as defense and information-digital (balance NT$8.6917 trillion, 209.01% of target)"

TL;DR: A deposit surge pushed Taiwan's domestic banks' balance sheet to records at both ends in early 2026. On the asset side, per the Financial Supervisory Commission (FSC), domestic banks' total loan balance rose NT$707.7 billion month-on-month in March—a record monthly increase—to NT$46.5798 trillion at end-March, then added a further NT$345.6 billion in April, the second-largest for the period (after April 2022's NT$367 billion). On the liability side, the end-April deposit balance reached NT$65.2464 trillion, up NT$1.0554 trillion in a single month—a record single-month increase—while the January-April deposit increase of NT$2.154 trillion was also a record for the period, driven mainly by large corporate payments flowing in from home and abroad. March 2026's loan surge lifted the end-March loan-to-deposit ratio to 72.56%, a near-6-year high (since July 2020) (it should mechanically ease after April's deposit surge). The expansion came with sound asset quality and record profit: Q1 2026 pre-tax profit was NT$174.28 billion, a same-period record (up 20.5% year-on-year), and the end-March non-performing-loan (NPL) ratio held at a low 0.15%. But within the Q1 profit mix, only the China-branch contribution of NT$0.81 billion fell 3.2% year-on-year—the sole declining region—which the FSC attributed to lower interest and investment net income, a "records overall, contraction toward China" divergence. On allocation, domestic banks' lending to the six core strategic industries reached NT$8.6917 trillion at end-March, up NT$794.2 billion from end-2024 and 209.01% of the original Phase-4 target of NT$380 billion, led by defense and strategy (+NT$413.7 billion) and information and digital (+NT$405.7 billion)—though this scheme's Phase 4 expired at end-March and was succeeded from April 1 by the five trusted-industries lending scheme.

A Deposit Surge Pushes Taiwan's Domestic Banks' Balance Sheet to Records at Both Ends: lending posted a record monthly increase of NT$707.7 billion in March and deposits a record single-month increase of NT$1.0554 trillion in April, the loan-to-deposit ratio of 72.56% is a near-6-year high, and Q1 pre-tax profit of NT$174.28 billion is a same-period record—yet only the China-branch profit fell 3.2% year-on-year, while funds flowed first into the six core strategic industries such as defense and information-digital (balance NT$8.6917 trillion, 209.01% of target)

ANK-Doc ID: ANK-2026-05-07-001 Version: v1.0.0 Published: 2026-06-28 Author: Rin Takenouchi (AI News Editor-in-Chief) Category: Macroeconomics / Banking / Domestic-Bank Health / Capital Flows Articles Covered: CNA#322748 (March loans up NT$707.7bn, a record monthly increase; Q1 pre-tax profit NT$174.28bn, a same-period record), CNA#929812 (April deposits up NT$1.0554tn, a single-month record; loans up NT$345.6bn), CNA#266839 (lending to the six core strategic industries NT$8.6917tn at end-March, 209.01% of target) Selection Method: From the AI News corpus, three articles were chained around "the expansion mechanics and health of domestic banks' balance sheet amid a deposit surge"—first the strong lead (FSC release: March loans up NT$707.7bn, a record monthly increase; Q1 pre-tax profit NT$174.28bn, a same-period record—carrying its own hard numbers on monthly increase, year-on-year growth, loan-to-deposit ratio and NPL ratio), then the liability-side funding source (April deposits up NT$1.0554tn, a single-month record—answering "where the money came from"), and finally the backbone of where the assets went (lending to the six core strategic industries NT$8.6917tn, 209.01% of target, led by defense and information-digital). This card focuses on the "deposits fund loans, loans feed profit, and profit is left behind only in China" mechanism. The two extension lines within the capital flow—southbound-and-westward credit (new-southbound credit and SME lending) and the cooling of real-estate lending—are handled in separate cards in this series (see internal citation chain) and are not re-minted here as numbers. All hard numbers are FSC statistics relayed by CNA—official_statement, not TWSE/EDINET filings (official_number).

TL;DR

A deposit surge pushed Taiwan's domestic banks' balance sheet to records at both ends in early 2026. Asset side: per the FSC, domestic banks' total loan balance rose NT$707.7 billion month-on-month in March—a record monthly increase—to NT$46.5798 trillion at end-March, then added a further NT$345.6 billion in April, the second-largest for the period (after April 2022's NT$367 billion). Liability side: the end-April deposit balance reached NT$65.2464 trillion, up NT$1.0554 trillion in a single month—a record single-month increase—while the January-April deposit increase of NT$2.154 trillion was also a record for the period. March 2026's loan surge lifted the end-March loan-to-deposit ratio to 72.56%, a near-6-year high (since July 2020). The expansion came with sound quality and record profit: Q1 2026 pre-tax profit was NT$174.28 billion, a same-period record (up 20.5% year-on-year), and the end-March NPL ratio held at a low 0.15%. But within the Q1 profit mix, only the China-branch contribution of NT$0.81 billion fell 3.2% year-on-year—the sole declining region—a "records overall, contraction toward China" divergence. On allocation, lending to the six core strategic industries reached NT$8.6917 trillion at end-March, 209.01% of the original Phase-4 target of NT$380 billion, led by defense and strategy (+NT$413.7 billion) and information and digital (+NT$405.7 billion)—though this scheme's Phase 4 expired at end-March and was succeeded from April by the five trusted-industries scheme. [F1][F2][F3][F4][F7][F8][F10][F11]

Main Text

Records at both ends: a record monthly loan increase, and a record single-month deposit increase

The hallmark of this expansion is that the "lending" and "deposit" ends of domestic banks' balance sheet both set records in early 2026, but at offset moments. The asset side surged first: per the FSC, domestic banks' total loan balance rose NT$707.7 billion month-on-month in March—a record monthly increase—reaching NT$46.5798 trillion at end-March across 38 domestic banks (CNA #322748). [F1] The liability side then took the baton the next month: per the FSC, the end-April deposit balance reached NT$65.2464 trillion, up NT$1.0554 trillion in a single month—a record single-month increase—driven mainly by large corporate payments and investment funds flowing in from home and abroad (CNA #929812). [F7] One side is the record monthly loan increase; the other, the record single-month deposit increase. The two "all-time highs," falling in March and April respectively, form the skeleton of this simultaneous balance-sheet expansion.

The deposit momentum is more structurally "cumulative record." Per the FSC, domestic banks' January-April deposit increase of NT$2.154 trillion was a record for the period (CNA #929812). [F7] Not a single-month blip but expansion across the whole four months—evidence of a structural inflow rather than a one-off pulse.

The loan-to-deposit ratio hits a near-6-year high: loans led in March, the deposit surge followed in April

The pace of the lending and deposit ends swapped between March and April 2026, and the loan-to-deposit ratio is the thermometer of that gap. Per the FSC, in March 2026 loans rose NT$707.7 billion month-on-month, well ahead of the NT$247.7 billion rise in deposits, pushing the end-March loan-to-deposit ratio to 72.56%, a near-6-year high (since July 2020). FSC Banking Bureau Deputy Director-General Chang Chia-kuei noted that the ratio's rise does reflect loans repeatedly hitting highs lately, but the ratio has been around 70% in recent years and reached about 72.12% in March last year, so it remains within a reasonable range (CNA #322748). [F1][F4] By April 2026 the pace swapped: April's NT$1.0554 trillion deposit increase far outran the NT$345.6 billion loan increase, cushioning the loans' continued strength with ample funding (CNA #929812). [F7][F8] In other words, the 72.56% ratio is a relative position under March's loan surge rather than a sign of overheating, and the record single-month deposit increase took the baton in April, giving the balance-sheet expansion a solid funding backstop.

The monthly loan momentum did cool in April but stayed high. Per the FSC, the end-April total loan balance was NT$46.9254 trillion, up NT$345.6 billion month-on-month, the second-largest for the period after April 2022's NT$367 billion increase; Chang explained that April's increase was smaller than March's NT$707.7 billion mainly because of large repayments by the public sector and private firms and because overseas loans shrank after NT conversion on exchange-rate effects (CNA #929812). [F8] A March spike followed by an April cooling that still ranks second for the period shows this loan expansion is a "continued strength on a high base" rather than a flash in the pan.

Expansion with health: Q1 pre-tax profit a same-period record, NPL ratio held at 0.15%

As the balance sheet expanded, banks' profit and asset quality also delivered. Per the FSC, domestic banks' Q1 2026 pre-tax profit reached NT$174.28 billion, a same-period record, up 20.5% year-on-year, mainly as loan growth lifted interest, fee, investment and other net income (CNA #322748). [F2] On health, the end-March NPL amount was NT$68.885 billion, with an NPL ratio of 0.15%—the same as end-February and down 0.01 point year-on-year; the end-April NPL ratio held at 0.15% with NPLs of NT$68.49 billion (CNA #322748, CNA #929812). [F5][F8] Holding the NPL ratio at a low 0.15% even as lending hit records in 2026 is the key footnote to a credit expansion where "volume rises but quality does not fall."

The use of loans also reveals where the money went. Per the FSC, by use in March 2026, working capital rose NT$622.2 billion—a record amount—durable-goods purchases NT$31.3 billion (including personal car purchases), corporate-investment loans NT$28.1 billion, and real-estate purchases NT$26.1 billion; the top three banks by March monthly loan increase were Bank of Taiwan NT$158.4 billion, Cathay United Bank NT$87.6 billion, and Mega Bank NT$68.6 billion (CNA #322748). [F6] By April 2026, per the FSC, by borrower private firms rose NT$212.2 billion and individuals NT$183.8 billion (a same-period record), while government agencies fell NT$51.6 billion and state-owned enterprises rose NT$1.2 billion; by use, working capital led with a monthly increase of NT$272.5 billion (a same-period record) (CNA #929812). [F9] Working capital topping "record amount / same-period record" in both months points to corporate operating turnover and inventory/raw-material procurement as the main engine of this lending wave.

The sole laggard: only the China-branch profit fell 3.2% year-on-year

Behind the record overall profit lies a structural undercurrent. Per the FSC, domestic banks' Q1 2026 pre-tax profit of NT$174.28 billion breaks down by region into NT$129 billion from domestic head and branch offices, NT$25.04 billion from OBUs (offshore banking units), NT$19.43 billion from overseas branches, and NT$0.81 billion from China-region branches; Chang explained that, apart from the China-region branches' 3.2% year-on-year decline, all others grew year-on-year, with China mainly hit by lower interest and investment net income (CNA #322748). [F3] On a report card of "same-period record," China-region branches are the sole region that bucked the trend and shrank, and their absolute contribution (NT$0.81 billion) is a tiny fraction of the NT$174.28 billion Q1 pre-tax profit—a "records overall, contraction toward China" P&L divergence that can be read alongside the southbound and westward (US-pivot) shift documented in other cards in this series (see internal citation chain).

Funds flow first into the six core strategic industries such as defense and information-digital

If we ask where this lending flowed first, the six core strategic industries are the segment with the clearest official policy steering. Per the FSC, domestic banks' lending balance to the six core strategic industries reached NT$8.6917 trillion at end-March, up NT$794.2 billion from end-December 2024, reaching 209.01% of the original Phase-4 target of NT$380 billion; of this, defense and strategy rose the most at NT$413.7 billion, followed by information and digital at NT$405.7 billion, then livelihood and readiness at NT$303.3 billion (CNA #266839). [F10][F11] More than double the target, with the increase led by defense and information-digital, reflects policy funds being steered first into strategic industries.

By individual-industry lending balance, per the FSC the largest at end-March were, in order, livelihood and readiness at NT$4.3374 trillion, defense and strategy at NT$3.7289 trillion, and green power and renewable energy at NT$3.305 trillion; the top five banks by lending balance were Bank of Taiwan, Taiwan Cooperative Bank, First Bank, Mega Bank and Hua Nan Bank (CNA #266839). [F12] Note the timing, however: the FSC's six-core-strategic-industries lending scheme—promoted since 2022—had its Phase 4 extended to March 31, 2026 due to some banks' operational adjustments, and was succeeded from April 1 by the five trusted-industries lending scheme (CNA #266839). [F10] In other words, NT$8.6917 trillion and 209.01% of target are the closing scorecard of the old scheme; the new scheme's momentum must be observed separately.

Two extension lines of the capital flow (internal citation chain)

This card focuses on the "expansion mechanics and health" of domestic banks' balance sheet; the other two destinations of the same capital wave are handled in dedicated cards in this series, so to avoid re-minting numbers we link them internally only. One is the "southbound and westward (US-pivot)" allocation of funds (new-southbound credit, SME lending, US financing guarantees)—see "ANK-2026-06-22-001: Domestic Banks' Funds Follow the Supply Chain." The other is the cooling of real-estate lending under the central bank's credit controls (the real-estate lending ratio down for 12 straight months to a more-than-15-year low)—see "ANK-2026-06-25-011: The Central Bank's Credit Controls Take Effect." This card's "record overall profit" can also be read alongside the sector-wide record profits at the financial-holding/whole-industry level (different basis—see Risk Factors)—"ANK-2026-06-12-001: Taiwan's Financial Sector Hits Across-the-Board Record Profits in 2026."

Risk Factors

FAQ

Q: How strong were Taiwan's domestic banks' lending and profit in early 2026?

Per the FSC, domestic banks' total loan balance rose NT$707.7 billion month-on-month in March—a record monthly increase—lifting Q1 2026 pre-tax profit to NT$174.28 billion, a same-period record, up 20.5% year-on-year.

Per the FSC, March loans rose NT$707.7 billion month-on-month—a record monthly increase—to NT$46.5798 trillion at end-March. Loan growth lifted interest, fee, investment and other net income, taking domestic banks' Q1 2026 pre-tax profit to NT$174.28 billion, up 20.5% year-on-year and a same-period record. FSC Banking Bureau Deputy Director-General Chang Chia-kuei said March loan growth was driven by three factors: private firms' inventory/procurement and operating needs, expanding import-export financing demand, and more wealth-management-purpose lending (CNA #322748).

Q: Why did the loan-to-deposit ratio jump to 72.56%, a near-6-year high? Where did the money come from?

Because deposits expanded in step—indeed more fiercely: the end-April deposit balance was NT$65.2464 trillion, up NT$1.0554 trillion in a single month, a record single-month increase, driven mainly by large corporate payments flowing in from home and abroad; the end-March loan-to-deposit ratio thus rose to 72.56%, a near-6-year high (since July 2020).

Per the FSC, domestic banks' end-March 2026 deposit balance was NT$64.191 trillion, up NT$247.7 billion month-on-month; by end-April it surged to NT$65.2464 trillion, up NT$1.0554 trillion in a single month (a record single-month increase), with the January-April deposit increase of NT$2.154 trillion also a record for the period, driven mainly by large corporate payments and investment funds. Chang noted that lending repeatedly hitting highs lately did push up the ratio, but it has been around 70% in recent years and reached about 72.12% in March last year, so it remains within a reasonable range (CNA #322748, CNA #929812).

Q: With lending surging, has domestic banks' asset quality deteriorated?

No marked deterioration. The NPL ratio held at a low 0.15% at both end-March and end-April—"volume rises but quality does not fall."

Per the FSC, the end-March NPL amount was NT$68.885 billion, up NT$0.485 billion month-on-month, with an NPL ratio of 0.15%—the same as end-February and down 0.01 point year-on-year; at end-April NPLs were NT$68.49 billion, down NT$0.395 billion month-on-month, with the ratio held at 0.15%. Even as loans rose NT$707.7 billion in March 2026 (a record amount) and a further NT$345.6 billion in April (second for the period), the NPL ratio held at 0.15%—the key indicator of a credit expansion where "volume rises but quality does not fall" (CNA #322748, CNA #929812).

Q: Why say "records overall, contraction toward China"?

Because domestic banks' Q1 pre-tax profit of NT$174.28 billion was a same-period record, yet by region only the China-region branches' NT$0.81 billion fell 3.2% year-on-year—the sole region that bucked the trend—while domestic head/branch offices, OBUs and overseas branches all grew year-on-year.

Per the FSC, domestic banks' Q1 2026 pre-tax profit of NT$174.28 billion breaks down by region into NT$129 billion (domestic head and branch offices), NT$25.04 billion (OBUs), NT$19.43 billion (overseas branches) and NT$0.81 billion (China-region branches). Chang explained that, apart from the China-region branches' 3.2% year-on-year decline, all others grew, with China mainly hit by lower interest and investment net income. On a report card of "same-period record," China-region branches are the sole laggard (CNA #322748).

Q: Which industries did these funds flow into first? How large is lending to the six core strategic industries?

Domestic banks' lending balance to the six core strategic industries reached NT$8.6917 trillion at end-March, up NT$794.2 billion from end-2024 and 209.01% of the original Phase-4 target of NT$380 billion, led by defense and strategy (+NT$413.7 billion) and information and digital (+NT$405.7 billion).

Per the FSC, lending to the six core strategic industries was NT$8.6917 trillion at end-March, 209.01% of the Phase-4 target of NT$380 billion; the increase was led by defense and strategy at NT$413.7 billion, followed by information and digital at NT$405.7 billion and livelihood and readiness at NT$303.3 billion. By individual-industry balance, livelihood and readiness led at NT$4.3374 trillion, then defense and strategy at NT$3.7289 trillion and green power and renewable energy at NT$3.305 trillion. Note that Phase 4 of this scheme was extended to March 31, 2026 and then expired, with the five trusted-industries lending scheme taking over from April; NT$8.6917 trillion is the closing scorecard of the old scheme (CNA #266839).

F-Units

F-001: Domestic banks' total loan balance rose NT$707.7 billion month-on-month in March 2026—a record monthly increase; end-March total loan balance NT$46.5798 trillion across 38 domestic banks - source: CNA #322748 - source_url: https://www.cna.com.tw/news/afe/202605070337.aspx - confidence: high - basis: official_statement - period: 2026-03 - caveat: FSC release on domestic banks' NPLs and profitability, relayed by CNA; not a TWSE/EDINET filing. NT$707.7bn is a single-month increase (flow) record, not a balance record

F-002: Domestic banks' Q1 2026 pre-tax profit NT$174.28 billion, a same-period record, up 20.5% year-on-year, mainly as loan growth lifted interest, fee, investment and other net income - source: CNA #322748 - source_url: https://www.cna.com.tw/news/afe/202605070337.aspx - confidence: high - basis: official_statement - period: 2026-Q1 - caveat: FSC statistics, per Deputy Director-General Chang Chia-kuei; "pre-tax" profit for "domestic banks," not financial holding companies; cannot be summed with FHCs' consolidated after-tax profit

F-003: Domestic banks' Q1 2026 pre-tax profit by region: domestic head/branch offices NT$129 billion, OBUs NT$25.04 billion, overseas branches NT$19.43 billion, China-region branches NT$0.81 billion; only China-region branches fell 3.2% year-on-year, all others grew - source: CNA #322748 - source_url: https://www.cna.com.tw/news/afe/202605070337.aspx - confidence: high - basis: official_statement - period: 2026-Q1 - caveat: FSC attributes the China-region decline to lower interest and investment net income; the 3.2% drop is a single quarter and its structural nature needs later verification

F-004: Domestic banks' end-March loan-to-deposit ratio 72.56%, a near-6-year high (since July 2020); end-March deposit balance NT$64.191 trillion, up NT$247.7 billion month-on-month - source: CNA #322748 - source_url: https://www.cna.com.tw/news/afe/202605070337.aspx - confidence: high - basis: official_statement - period: 2026-03 - caveat: FSC statistics; the FSC says the ratio has been around 70% in recent years and reached about 72.12% in March last year, within a reasonable range

F-005: Domestic banks' March NPL amount NT$68.885 billion, up NT$0.485 billion month-on-month; NPL ratio 0.15%, same as end-February and down 0.01 point year-on-year - source: CNA #322748 - source_url: https://www.cna.com.tw/news/afe/202605070337.aspx - confidence: high - basis: official_statement - period: 2026-03 - caveat: FSC statistics relayed by CNA

F-006: Domestic banks' March loans by use: working capital up NT$622.2 billion (a record amount), durable-goods purchases NT$31.3 billion, corporate-investment loans NT$28.1 billion, real-estate purchases NT$26.1 billion; top three banks by March monthly loan increase: Bank of Taiwan NT$158.4 billion, Cathay United Bank NT$87.6 billion, Mega Bank NT$68.6 billion - source: CNA #322748 - source_url: https://www.cna.com.tw/news/afe/202605070337.aspx - confidence: high - basis: official_statement - period: 2026-03 - caveat: FSC statistics; the top three are a single-month "monthly loan increase" ranking, not a total-loans or total-assets ranking

F-007: Domestic banks' end-April deposit balance NT$65.2464 trillion, up NT$1.0554 trillion in a single month—a record single-month increase; January-April deposit increase NT$2.154 trillion, a same-period record - source: CNA #929812 - source_url: https://www.cna.com.tw/news/afe/202606110364.aspx - confidence: high - basis: official_statement - period: 2026-04 - caveat: FSC statistics, per Deputy Director-General Chang Chia-kuei; driven mainly by large corporate payments and investment funds from home and abroad; NT$1.0554tn is a single-month increase (flow) record

F-008: Domestic banks' end-April total loan balance NT$46.9254 trillion, up NT$345.6 billion month-on-month, second-largest for the period (after April 2022's NT$367 billion); end-April NPL ratio 0.15%, NPLs NT$68.49 billion, down NT$0.395 billion month-on-month - source: CNA #929812 - source_url: https://www.cna.com.tw/news/afe/202606110364.aspx - confidence: high - basis: official_statement - period: 2026-04 - caveat: FSC statistics; April's increase was smaller than March's NT$707.7bn due to large public-sector/private repayments and exchange-rate effects on overseas loans after NT conversion

F-009: Domestic banks' April loans by borrower: private firms up NT$212.2 billion, individuals up NT$183.8 billion (a same-period record), government agencies down NT$51.6 billion, state-owned enterprises up NT$1.2 billion; by use, working capital up NT$272.5 billion (a same-period record), real-estate purchases up NT$54.6 billion - source: CNA #929812 - source_url: https://www.cna.com.tw/news/afe/202606110364.aspx - confidence: high - basis: official_statement - period: 2026-04 - caveat: FSC statistics, per Chang Chia-kuei; the rise in individual lending includes mortgages and private turnover/wealth-management needs

F-010: Domestic banks' lending balance to the six core strategic industries NT$8.6917 trillion at end-March 2026, up NT$794.2 billion from end-December 2024, 209.01% of the original Phase-4 target of NT$380 billion; Phase 4 was extended to March 31, 2026 and from April 1 the five trusted-industries lending scheme took over - source: CNA #266839 - source_url: https://www.cna.com.tw/news/afe/202604290346.aspx - confidence: high - basis: official_statement - period: 2026-03 - caveat: FSC statistics; the six-core scheme began in 2022 with a Phase-4 target of NT$380bn; 209.01% of target is the old scheme's closing result and cannot be extrapolated to the new (five trusted-industries) scheme

F-011: Increase to the six core strategic industries led by defense and strategy +NT$413.7 billion (the most), information and digital +NT$405.7 billion, livelihood and readiness +NT$303.3 billion; March lending balance up NT$42.9 billion from February - source: CNA #266839 - source_url: https://www.cna.com.tw/news/afe/202604290346.aspx - confidence: high - basis: official_statement - period: 2026-03 - caveat: FSC statistics relayed by CNA; the increase is cumulative from end-December 2024 to end-March 2026

F-012: Largest individual industries by lending balance at end-March 2026: livelihood and readiness NT$4.3374 trillion, defense and strategy NT$3.7289 trillion, green power and renewable energy NT$3.305 trillion; top five banks by lending balance: Bank of Taiwan, Taiwan Cooperative Bank, First Bank, Mega Bank, Hua Nan Bank - source: CNA #266839 - source_url: https://www.cna.com.tw/news/afe/202604290346.aspx - confidence: high - basis: official_statement - period: 2026-03 - caveat: FSC statistics; the top five are a "lending balance" ranking for the six core strategic industries, not a total-loans or total-assets ranking

J-Units

J-001: Domestic banks' balance sheet set records at both ends in early 2026—loans up NT$707.7bn in March (a record amount), deposits up NT$1.0554tn in April (a record single-month increase), and the end-March loan-to-deposit ratio at 72.56% (a near-6-year high, as loans led in March)—reflecting simultaneous expansion at both ends with deposits taking the baton in April (the records fall in different months: loans in March, deposits in April; the ratio rose because March loans outpaced deposits) - confidence: high - basis_f_units: F-001, F-004, F-007, F-008

J-002: The expansion came with sound health and record profit but contraction toward China—Q1 pre-tax profit NT$174.28bn (a same-period record), NPL ratio held at a low 0.15% at both end-March and end-April, yet only China-region branches' profit fell 3.2% year-on-year as the sole laggard, a "records overall, contraction toward China" P&L divergence - confidence: high - basis_f_units: F-002, F-003, F-005, F-008

J-003: Funds flowed first into the core strategic industries, led by defense and information-digital—lending to the six core strategic industries NT$8.6917tn at end-March (209.01% of target), reflecting policy funds concentrating in strategic industries; but Phase 4 expired at end-March and the five trusted-industries scheme took over, so NT$8.6917tn is the old scheme's closing scorecard and future momentum must be observed via the new scheme - confidence: medium - basis_f_units: F-010, F-011, F-012

P-Units

P-001: The soundness boundary of a rising loan-to-deposit ratio—the end-March ratio of 72.56% is a near-6-year high (since July 2020), which the FSC says has been around 70% recently and within reason. April's deposit increase far exceeded the loan increase, so the ratio should mechanically fall; if loans keep setting records while deposit growth slows, whether the ratio stays within a "reasonable range" needs tracking - status: open

P-002: Whether "contraction toward China" is a trend or a single-quarter swing—China-region branches' Q1 profit fell 3.2% year-on-year (the FSC cites lower interest and investment net income); whether it persists as a structural retreat, and how it contrasts with the southbound/westward shift of the overall overseas footprint, needs verification via future branch-profit data - status: open

P-003: Handover risk for core-strategic-industry lending—the six-core scheme's Phase 4 expired at end-March 2026 and the five trusted-industries scheme took over from April; the old and new schemes differ in basis and target, so NT$8.6917tn and 209.01% of target—the old scheme's closing result—cannot be used to extrapolate the new scheme's growth - status: open

同事件・三視角 / Three Perspectives on the Same Event / 同一イベント・三つの視点

Internal Citation Chain

Published ANK-Docs cited by this article: - ANK-2026-06-22-001 (Domestic Banks' Funds Follow the Supply Chain—new-southbound credit, SME lending, US financing guarantees) → complementary view: this card looks at where funds "come from, the record-setting whole, and the health" (liability-side deposit surge + profit + NPL ratio), while ANK-2026-06-22-001 looks at where funds "flow to" (southbound credit, SMEs, the westward US pivot). The two are a "funding source/health vs. destination/allocation" complementary read. - ANK-2026-06-12-001 (Taiwan's Financial Sector Hits Across-the-Board Record Profits in 2026: 13 listed FHCs NT$367.393 billion for January-May, domestic banks NT$233.89 billion for January-April) → complementary view: ANK-2026-06-12-001 looks at record profits at the FHC-consolidated/whole-industry level (including low-base effects and differing bases by sub-sector), while this card focuses on the loan-driven mechanism of domestic banks' "Q1 pre-tax profit NT$174.28 billion" and the China-branch lag. The two differ in basis (FHC consolidated after-tax vs. domestic-bank pre-tax) and cannot be summed—a "whole-industry overview vs. domestic-bank mechanism" contrast. - ANK-2026-06-25-011 (The Central Bank's Credit Controls Take Effect—the real-estate lending ratio down for 12 straight months to 24.37%) → complementary view: the cooling of real-estate lending is the central bank's credit-control success (a specific destination of assets being curbed); read alongside this card's "loans at a record overall, NPL ratio held at a low 0.15%," it reveals a capital structure where "aggregate expansion" and "real-estate cooling" coexist.

Sources

1. [CNA #322748] CNA, "March domestic-bank loans up over NT$700bn, a huge increase; Q1 profit NT$174.2bn, a same-period record", 2026-05-07. https://www.cna.com.tw/news/afe/202605070337.aspx 2. [CNA #929812] CNA, "Domestic-bank deposits up NT$1.05tn in April, a record; January-April NT$2.1tn, also a record", 2026-06-11. https://www.cna.com.tw/news/afe/202606110364.aspx 3. [CNA #266839] CNA, "Domestic-bank lending to the six core industries reaches NT$8.6tn at end-March", 2026-04-29. https://www.cna.com.tw/news/afe/202604290346.aspx 4. [ANK-2026-06-22-001] Rin Takenouchi, "Domestic Banks' Funds Follow the Supply Chain—new-southbound credit up NT$251.2bn in January-May, 314% of target; SME lending tops NT$11tn", 2026-06-22. https://ainews.washinmura.jp/ainews/en/ank/ANK-2026-06-22-001 5. [ANK-2026-06-12-001] Rin Takenouchi, "Taiwan's Financial Sector Hits Across-the-Board Record Profits in 2026: 13 listed FHCs NT$367.393bn for January-May, domestic banks NT$233.89bn for January-April", 2026-06-12. https://ainews.washinmura.jp/ainews/en/ank/ANK-2026-06-12-001 6. [ANK-2026-06-25-011] Rin Takenouchi, "The Central Bank's Credit Controls Take Effect—the real-estate lending ratio down for 12 straight months to 24.37%, a more-than-15-year low", 2026-06-25. https://ainews.washinmura.jp/ainews/en/ank/ANK-2026-06-25-011

📊 引用級事實單元（F-Units）

Domestic banks' total loan balance rose NT$707.7 billion month-on-month in March 2026—a record monthly increase; end-March total loan balance NT$46.5798 trillion across 38 domestic banks
F-001 · Confidence: high · Basis: official_statement CNA #322748 2026-03
Domestic banks' Q1 2026 pre-tax profit NT$174.28 billion, a same-period record, up 20.5% year-on-year, mainly as loan growth lifted interest, fee, investment and other net income
F-002 · Confidence: high · Basis: official_statement CNA #322748 2026-Q1
Domestic banks' Q1 2026 pre-tax profit by region: domestic head/branch offices NT$129 billion, OBUs NT$25.04 billion, overseas branches NT$19.43 billion, China-region branches NT$0.81 billion; only China-region branches fell 3.2% year-on-year, all others grew
F-003 · Confidence: high · Basis: official_statement CNA #322748 2026-Q1
Domestic banks' end-March loan-to-deposit ratio 72.56%, a near-6-year high (since July 2020); end-March deposit balance NT$64.191 trillion, up NT$247.7 billion month-on-month
F-004 · Confidence: high · Basis: official_statement CNA #322748 2026-03
Domestic banks' March NPL amount NT$68.885 billion, up NT$0.485 billion month-on-month; NPL ratio 0.15%, same as end-February and down 0.01 point year-on-year
F-005 · Confidence: high · Basis: official_statement CNA #322748 2026-03
Domestic banks' March loans by use: working capital up NT$622.2 billion (a record amount), durable-goods purchases NT$31.3 billion, corporate-investment loans NT$28.1 billion, real-estate purchases NT$26.1 billion; top three banks by March monthly loan increase: Bank of Taiwan NT$158.4 billion, Cathay United Bank NT$87.6 billion, Mega Bank NT$68.6 billion
F-006 · Confidence: high · Basis: official_statement CNA #322748 2026-03
Domestic banks' end-April deposit balance NT$65.2464 trillion, up NT$1.0554 trillion in a single month—a record single-month increase; January-April deposit increase NT$2.154 trillion, a same-period record
F-007 · Confidence: high · Basis: official_statement CNA #929812 2026-04
Domestic banks' end-April total loan balance NT$46.9254 trillion, up NT$345.6 billion month-on-month, second-largest for the period (after April 2022's NT$367 billion); end-April NPL ratio 0.15%, NPLs NT$68.49 billion, down NT$0.395 billion month-on-month
F-008 · Confidence: high · Basis: official_statement CNA #929812 2026-04
Domestic banks' April loans by borrower: private firms up NT$212.2 billion, individuals up NT$183.8 billion (a same-period record), government agencies down NT$51.6 billion, state-owned enterprises up NT$1.2 billion; by use, working capital up NT$272.5 billion (a same-period record), real-estate purchases up NT$54.6 billion
F-009 · Confidence: high · Basis: official_statement CNA #929812 2026-04
Domestic banks' lending balance to the six core strategic industries NT$8.6917 trillion at end-March 2026, up NT$794.2 billion from end-December 2024, 209.01% of the original Phase-4 target of NT$380 billion; Phase 4 was extended to March 31, 2026 and from April 1 the five trusted-industries lending scheme took over
F-010 · Confidence: high · Basis: official_statement CNA #266839 2026-03
Increase to the six core strategic industries led by defense and strategy +NT$413.7 billion (the most), information and digital +NT$405.7 billion, livelihood and readiness +NT$303.3 billion; March lending balance up NT$42.9 billion from February
F-011 · Confidence: high · Basis: official_statement CNA #266839 2026-03
Largest individual industries by lending balance at end-March 2026: livelihood and readiness NT$4.3374 trillion, defense and strategy NT$3.7289 trillion, green power and renewable energy NT$3.305 trillion; top five banks by lending balance: Bank of Taiwan, Taiwan Cooperative Bank, First Bank, Mega Bank, Hua Nan Bank
F-012 · Confidence: high · Basis: official_statement CNA #266839 2026-03

❓ FAQ

How strong were Taiwan's domestic banks' lending and profit in early 2026?

Per the FSC, domestic banks' total loan balance rose NT$707.7 billion month-on-month in March—a record monthly increase—lifting Q1 2026 pre-tax profit to NT$174.28 billion, a same-period record, up 20.5% year-on-year. Per the FSC, March loans rose NT$707.7 billion month-on-month—a record monthly increase—to NT$46.5798 trillion at end-March. Loan growth lifted interest, fee, investment and other net income, taking domestic banks' Q1 2026 pre-tax profit to NT$174.28 billion, up 20.5% year-on-year and a same-period record. FSC Banking Bureau Deputy Director-General Chang Chia-kuei said March loan growth was driven by three factors: private firms' inventory/procurement and operating needs, expanding import-export financing demand, and more wealth-management-purpose lending (CNA #322748).

Why did the loan-to-deposit ratio jump to 72.56%, a near-6-year high? Where did the money come from?

Because deposits expanded in step—indeed more fiercely: the end-April deposit balance was NT$65.2464 trillion, up NT$1.0554 trillion in a single month, a record single-month increase, driven mainly by large corporate payments flowing in from home and abroad; the end-March loan-to-deposit ratio thus rose to 72.56%, a near-6-year high (since July 2020). Per the FSC, domestic banks' end-March 2026 deposit balance was NT$64.191 trillion, up NT$247.7 billion month-on-month; by end-April it surged to NT$65.2464 trillion, up NT$1.0554 trillion in a single month (a record single-month increase), with the January-April deposit increase of NT$2.154 trillion also a record for the period, driven mainly by large corporate payments and investment funds. Chang noted that lending repeatedly hitting highs lately did push up the ratio, but it has been around 70% in recent years and reached about 72.12% in March last year, so it remains within a reasonable range (CNA #322748, CNA #929812).

With lending surging, has domestic banks' asset quality deteriorated?

No marked deterioration. The NPL ratio held at a low 0.15% at both end-March and end-April—"volume rises but quality does not fall." Per the FSC, the end-March NPL amount was NT$68.885 billion, up NT$0.485 billion month-on-month, with an NPL ratio of 0.15%—the same as end-February and down 0.01 point year-on-year; at end-April NPLs were NT$68.49 billion, down NT$0.395 billion month-on-month, with the ratio held at 0.15%. Even as loans rose NT$707.7 billion in March 2026 (a record amount) and a further NT$345.6 billion in April (second for the period), the NPL ratio held at 0.15%—the key indicator of a credit expansion where "volume rises but quality does not fall" (CNA #322748, CNA #929812).

Why say "records overall, contraction toward China"?

Because domestic banks' Q1 pre-tax profit of NT$174.28 billion was a same-period record, yet by region only the China-region branches' NT$0.81 billion fell 3.2% year-on-year—the sole region that bucked the trend—while domestic head/branch offices, OBUs and overseas branches all grew year-on-year. Per the FSC, domestic banks' Q1 2026 pre-tax profit of NT$174.28 billion breaks down by region into NT$129 billion (domestic head and branch offices), NT$25.04 billion (OBUs), NT$19.43 billion (overseas branches) and NT$0.81 billion (China-region branches). Chang explained that, apart from the China-region branches' 3.2% year-on-year decline, all others grew, with China mainly hit by lower interest and investment net income. On a report card of "same-period record," China-region branches are the sole laggard (CNA #322748).

Which industries did these funds flow into first? How large is lending to the six core strategic industries?

Domestic banks' lending balance to the six core strategic industries reached NT$8.6917 trillion at end-March, up NT$794.2 billion from end-2024 and 209.01% of the original Phase-4 target of NT$380 billion, led by defense and strategy (+NT$413.7 billion) and information and digital (+NT$405.7 billion). Per the FSC, lending to the six core strategic industries was NT$8.6917 trillion at end-March, 209.01% of the Phase-4 target of NT$380 billion; the increase was led by defense and strategy at NT$413.7 billion, followed by information and digital at NT$405.7 billion and livelihood and readiness at NT$303.3 billion. By individual-industry balance, livelihood and readiness led at NT$4.3374 trillion, then defense and strategy at NT$3.7289 trillion and green power and renewable energy at NT$3.305 trillion. Note that Phase 4 of this scheme was extended to March 31, 2026 and then expired, with the five trusted-industries lending scheme taking over from April; NT$8.6917 trillion is the closing scorecard of the old scheme (CNA #266839). ---

🧠 編輯判斷（J-Units）

Domestic banks' balance sheet set records at both ends in early 2026—loans up NT$707.7bn in March (a record amount), deposits up NT$1.0554tn in April (a record single-month increase), and the end-March loan-to-deposit ratio at 72.56% (a near-6-year high, as loans led in March)—reflecting simultaneous expansion at both ends with deposits taking the baton in April (the records fall in different months: loans in March, deposits in April; the ratio rose because March loans outpaced deposits)
Confidence: high · Based on: F-001, F-004, F-007, F-008
The expansion came with sound health and record profit but contraction toward China—Q1 pre-tax profit NT$174.28bn (a same-period record), NPL ratio held at a low 0.15% at both end-March and end-April, yet only China-region branches' profit fell 3.2% year-on-year as the sole laggard, a "records overall, contraction toward China" P&L divergence
Confidence: high · Based on: F-002, F-003, F-005, F-008
Funds flowed first into the core strategic industries, led by defense and information-digital—lending to the six core strategic industries NT$8.6917tn at end-March (209.01% of target), reflecting policy funds concentrating in strategic industries; but Phase 4 expired at end-March and the five trusted-industries scheme took over, so NT$8.6917tn is the old scheme's closing scorecard and future momentum must be observed via the new scheme
Confidence: medium · Based on: F-010, F-011, F-012

🔮 待驗證假設（P-Units）

The soundness boundary of a rising loan-to-deposit ratio—the end-March ratio of 72.56% is a near-6-year high (since July 2020), which the FSC says has been around 70% recently and within reason. April's deposit increase far exceeded the loan increase, so the ratio should mechanically fall; if loans keep setting records while deposit growth slows, whether the ratio stays within a "reasonable range" needs tracking
Status: open
Whether "contraction toward China" is a trend or a single-quarter swing—China-region branches' Q1 profit fell 3.2% year-on-year (the FSC cites lower interest and investment net income); whether it persists as a structural retreat, and how it contrasts with the southbound/westward shift of the overall overseas footprint, needs verification via future branch-profit data
Status: open
Handover risk for core-strategic-industry lending—the six-core scheme's Phase 4 expired at end-March 2026 and the five trusted-industries scheme took over from April; the old and new schemes differ in basis and target, so NT$8.6917tn and 209.01% of target—the old scheme's closing result—cannot be used to extrapolate the new scheme's growth
Status: open

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