TREND: The life insurer set aside an additional NT$2 billion, following other firms in the sector, as the local currency flies high against the greenback
Date: Oct 12, 2020
By: Chen Cheng-hui / Staff reporter
With the New Taiwan dollar’s appreciation trend against the US dollar continuing, Cathay Life Insurance Co (國泰人壽) is facing higher hedging costs and last month set aside an additional NT$2 billion (US$69.05 million) in foreign-exchange volatility reserve, a filing showed.
In the regulatory filing issued on Thursday last week, Cathay Financial Holding Co (國泰金控) said that its life insurance subsidiary had gained the Financial Supervisory Commission’s approval to increase its volatility reserve as buffer against potential foreign-exchange losses.
The move came after Cathay Life in April, June and July raised its volatility reserve by NT$1 billion, NT$1 billion and NT$3 billion respectively.
Foreign-exchange volatility reserves of major life insurers have dropped amid the local currency’s appreciation trend. [FULL STORY]