"Four Loans in One Household" Risk Under Control! Financial Supervisory Commission: Low Proportion of Multi-Loan Customers at Domestic Banks, Plans Cross-Industry Joint Defense

Concerns have been growing over the phenomenon of "four loans in one household"—mortgages, auto loans, personal loans, and stock margin financing—amid a vibrant Taiwan stock market, raising fears of a credit risk crisis. On the 28th, the Financial Supervisory Commission (FSC) stated that after consulting with several banks, the proportion of customers holding two or more types of multiple loans is "extremely low," amounting to only a low single-digit percentage. Combined with the overall non-performing loan (NPL) ratio remaining stable between 0.14% and 0.16%, leverage risks remain under control.

Moreover, the FSC is accelerating efforts to establish a cross-industry credit defense mechanism between banks and securities firms, aiming to prevent excessive credit expansion through bidirectional information sharing and build a more robust risk protection framework.

In response to media inquiries about the rising scale and number of "four-loan" customers, Wang Yun-chung, Deputy Director of the Banking Bureau, explained during a regular press briefing that personal investment and financing loans offered by domestic banks are still predominantly secured loans such as mortgages and auto loans. He emphasized that the overall lending model remains prudent, considering borrower repayment capacity, collateral quality, and post-loan management mechanisms.

According to the FSC's survey of selected banks, the number of individual financial customers simultaneously holding housing loans, auto loans, and small personal loans—"multiple loan" customers—accounts for an "extremely low" proportion of total retail customers, falling within the low single-digit percentage range. Wang stressed that banks have already established special review and enhanced control mechanisms for such multiple borrowers or those with high debt-to-income ratios (DBR). Additionally, the NPL ratio at domestic banks has remained stable between 0.14% and 0.16% recently, with no significant fluctuations.

Regarding fund usage and classification, media questioned whether funds from "investment-type mortgages" or "working capital loans" are flowing heavily into the stock market. Wang responded that the regulatory authority continuously monitors abnormal growth in mortgages, personal loans, and stock margin financing. If a bank's business growth deviates from normal patterns or risk indicators show significant changes, the FSC will first request explanations and, if necessary, may initiate special financial inspections through the Inspection Bureau.

To further strengthen cross-market leverage risk prevention, the FSC is currently working with the Credit Information Center, the Taiwan Stock Exchange, the Bankers Association, and the Securities Association to develop a "cross-industry credit joint defense mechanism."

Wang noted that while the Credit Information Center and the stock exchange already exchange data, current sharing is limited to simple "yes/no" queries on negative information (e.g., default records). The future direction aims to advance toward bidirectional information sharing, allowing banks and securities firms, with customer consent, to access more specific risk data—such as total financing amounts or negative records—to enhance the precision of risk management.

However, challenges remain in implementing the cross-industry mechanism. Wang stated that while customer consent can resolve issues under the Personal Data Protection Act, the main challenges lie in designing the information exchange platform and evaluating relevant regulations. The mechanism is expected to be built directly on the existing platforms of the Credit Information Center and the stock exchange, without requiring major legal amendments, and the FSC aims to expedite its implementation.