(Refiles to add link to TABLE on Taiwan firms' exposure)

By Faith Hung

TAIPEI, July 15 (Reuters) - Taiwan financial stocks plunged on Tuesday as regulators disclosed that the companies had more than T$600 billion ($20 billion) in exposure to troubled U.S. mortgage lenders Fannie Mae (FNM.N: Quote, Profile, Research) and Freddie Mac (FRE.N: Quote, Profile, Research).

Insurers hold the lion's share of the exposure to mainly debt-related products, with T$538.6 billion, while banks' exposure totalled about T$79.4 billion, the Financial Supervisory Commission told reporters at a media briefing.

Taiwan's Financial Supervisory Commission announced the numbers amid a selloff of financial shares in Taiwan on concerns about exposure to the two U.S. mortgage companies.

The banking and insurance sub-index slid 5.8 percent by early afternoon, underperforming the main TAIEX index's .TWII 4.5 percent fall and following a similar trend in other parts of Asia that also saw financial stocks plummetting.

Analysts and government officials pointed out that the risk was relatively small for holders of Fannie Mae and Freddie Mac debt because they are U.S. government-sponsored agencies, and that the selloff may be more related to negative sentiment than a real threat.

"We think the possibility is limited for insurance companies to set aside write-downs," Lee Chi-chu, vice chairwoman of the commission, told a news conference.

Financial regulators said Taiwan's financial firms invested mainly in mortgage-backed securities and bonds of the U.S. lenders, with very little exposure to their shares.