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DIRECTION
From : Ministry of Finance (the "MOF")
Date : August 7, 2003
Ref. No. : Tai-Tsai-Rong-(5)-Zi-0928011207
Attachment : Application of issuance of Bank Debentures for foreign banks.
Explanation:
1. Taiwan branches of Foreign Banks may issue Bank Debentures in accordance with the Banking Act, Article 123, and applying Article 72-1.
2. Unless otherwise provided herein, a foreign bank's Taiwan branch issuing Bank Debentures shall apply the following regulations in accordance with the "Regulations Governing Issuance of Bank Debentures by Banks".
(1) When issuing Bank Debentures, a foreign bank's Taiwan branches shall be the issuer and a guarantee from the head office shall be provided. The funds raised may only be used within the R.O.C. and may not be converted into foreign currencies.
(2) The total outstanding amount of Bank Debentures issued by a foreign bank's Taiwan branches shall not exceed two (2) times such branches' net worth (net worth shall mean working capital and retained earnings in Taiwan) as of the end of the preceding fiscal year. The funds remitted to a foreign bank's Taiwan branch by the head office during the fiscal year is allowed included in calculating net worth from and after the date the audit report [from CPA] certifying the above remittance is issued.
(3) The foreign bank's Taiwan branches may not apply for issuance of Bank Debentures if any of the following situations exist:
(i) The branches' allowance for possible losses are not sufficient;
(ii) The branch had accumulated losses for the preceding fiscal year;
(iii) The branch's ratio of NPL ratio is higher than 5% for the preceding quarter; or
(iv) Such branch has been involved in irregularities involving amounts of NT$100,000,000 or more during the most recent one year period.
(4) The foreign bank's Taiwan branch applying for issuance of Bank Debentures shall submit an application for issuance of Bank Debentures and other required documents to the competent authority. |