TAIPEI (Taiwan News) — The Taipei Exchange announced on Tuesday a default settlement amounting to NT$25.65 million (US$788,879) involving the CTBC US Treasury 20+ Year Bond ETF, marking the highest default settlement amount recorded this year.

The case was reported by SinoPac Securities. A default settlement occurs when a securities transaction is finalized, but the payment or transfer of shares fails to be completed, per CNA and Sinotrade.

In this case, the default occurred because the investor’s transaction could not be fully settled. Despite making both purchases and sales, the investor was unable to cover the NT$59,000 gap between the total value of the buys and the sales.

This is the fifth default settlement reported by TPEx in 2025, with four of those cases occurring in April alone. The first case was recorded in February and involved semiconductor company IET-KY, with a default amount of NT$16.3 million.

It was followed by an NT$21 million default involving optical communications firm Browave, an NT$16.79 million default by telecom equipment maker Luxnet, and an NT$18.5 million default linked to Oneness Biotech.

Under Taiwan’s securities regulations, brokerage firms can impose penalties of up to 7% of the transaction amount for investors who default on their settlements. Securities firms may also seek compensation for any associated costs or debts incurred due to the breach.

In more severe cases where the default threatens market stability, criminal penalties may be applied. Violations could lead to prison sentences ranging from three to ten years under Taiwan’s securities laws.

Moreover, default settlement records are submitted to the Joint Credit Information Center, a centralized database accessible to financial institutions. A history of settlement defaults can negatively impact an individual’s credit score, potentially hindering future applications for credit cards, mortgages, or loans.