09.20.2001
Some losses in typhoon aftermath

• Development: Losses due to flooding and power outage in bank branches in the wake of Typhoon Nari are expected to total more than NT$200m. Flooding has damaged computer equipment and custodian boxes. Banks have been operating as normally as possible since yesterday after two full days of closure. Most losses are covered by insurance and will be compensated for by tax deduction.

• Analysis: We expect actual losses will be far greater than NT$200m if two days’ loss of business is taken into account. While typhoon damage could exacerbate the non-performing loans problem, reconstruction could stimulate loan growth.

• Primasia View: Banks will gradually recover. We maintain our Outperform rating on UWCCB and Fubon.