Banking Bureau, Financial Supervisory Commission, R.O.C.: Laws and Regulations Retrieving System of the Banking Bureau

Title: The Banking Act of The Republic of China (Amendment by Hua-Zong-Yi-Yi-Tze No. 09600034631 issued on March 21, 2007)

Article 62 If it is likely that a Bank, due to obvious adverse changes in its business or financial status, is unable to pay its liabilities when due or there are risks that will damage to depositors' interests, the Central Competent Authority shall order such a Bank to suspend business and undergo rehabilitation within a certain time limit, suspend part of such a Bank's business, assign officials to take conservatorship or receivership over its operations or take other necessary actions. In the same way, it may request the relevant authorities to restrict the departure from the country of the Responsible Person of the Bank.
When assigning officials to take conservatorship or receivership over a Bank, the Central Competent Authority may suspend all or part of the rights and functions of shareholders' meetings, directors or supervisors.
Regulations governing conservatorship or receivership under the preceding two paragraphs shall be as prescribed by the Central Competent Authority.
When the Competent Authority orders a Bank to suspend business and undergo rehabilitation within a certain time limit, or sends officials to take conservatorship or receivership over a Bank, the provisions of the Company Act concerning temporary managers, inspectors, and reorganization shall not apply.
A Bank, as referred to in Paragraph 1 above, which has been ordered to suspend business, may apply to the Central Competent Authority to resume its business operations if it has recovered from financial insolvency during the period of time prescribed for rehabilitation. If the approval to resume business is not granted within the period of time prescribed for taking corrective measures of the business of the Bank, the Bank's Permit shall be revoked, and the Bank shall then be deemed to have been dissolved commencing from the date of suspension, and the rehabilitation procedures shall be deemed the liquidation procedures.
The provisions of the preceding five paragraphs shall apply to Banks and other financial institutions which are established under other laws.
Article 64 If the losses of a Bank exceed one third (1/3) of the Bank's capital, the Bank's directors or supervisors shall immediately report such information to the Central Competent Authority.
In the above-described circumstances, the Central Competent Authority shall require the Bank to make up such a deficit within three (3) months. If the Bank fails to do so within such a prescribed period of time, the Central Competent Authority shall send officials to take receivership over the Bank or the Bank shall be ordered to suspend its business.