Only NT$200 Billion of NT$500 Billion Quota Usable
The National Financial Stabilization Fund was established in 2000 to respond to major domestic and foreign events and maintain stability in capital markets and other financial markets. Currently available funds total NT$500 billion, of which NT$200 billion is borrowed from financial institutions using government-held shares in public and private enterprises, such as TSMC and Chunghwa Telecom, as collateral; the other NT$300 billion comes from investable funds including postal savings, postal life insurance reserves, the Labor Insurance Fund, the Labor Pension Fund, and the Civil Servants Retirement Fund. The Ministry of Finance noted that as government funds also have their own investment needs, the NT$300 billion has basically never been used, leaving the NT$200 billion borrowing cap as the amount actually available.
Market Cap Up 17-Fold, Plan to Expand to NT$1 Trillion
When the Fund was established, Taiwan stock market capitalization was NT$9.2 trillion; by the end of October 2026, listed market capitalization had reached NT$158.38 trillion, an increase of more than 17 times; the foreign investor share also rose from 8.44% to 46.78%, with recent foreign net selling exceeding NT$100 billion on multiple days. At the Legislative Yuan Finance Committee meeting on the 11th, DPP legislators Kuo Kuo-wen and Lee Kun-cheng said the scale should be expanded further. The Legislative Yuan discussed a proposal last December to raise the total scale to NT$1 trillion, keeping government fund resources unchanged at NT$300 billion while raising borrowings from financial institutions to NT$700 billion; the proposal is still pending review.
Finance Minister Welcomes Expansion for Greater Flexibility
Finance Minister Chuang Tsui-yun said in the Legislative Yuan on the 11th that she respects the Legislative Yuan decision and views raising financial-institution borrowings to NT$700 billion positively, saying it would give the Stabilization Fund greater operational flexibility. On questions about whether funds have already entered the market, she said she has authorized the Executive Secretary to deploy funds as warranted to carry out market stabilization tasks, and that ignition can stabilize investor confidence; as to whether it has entered the market, she does not need to know and should not know. Executive Secretary and Deputy Finance Minister Juan Ching-hwa monitors the market morning and evening, as U.S. stocks open at night. Chuang also said state-owned banks have their own financial strategies and regulatory constraints, and are encouraged to buy on dips if deemed necessary and helpful to earnings; she also called on foreign investors, saying Taiwan stock fundamentals are quite strong and they should have confidence.