Taichung Bank Announces Explanation Regarding FSC Penalty Case

1. Date of Incident: 115/08/15 2. Entity Involved: The Bank 3. Cause of Incident (Event Description): A former employee of Taichung Commercial Bank misappropriated on-hand cash and committed deficiencies in credit operations, violating Article 45-1, Paragraph 1 of the Banking Act and the 'Implementation Rules for Internal Control and Audit Systems of Financial Holding Companies and Banks' authorized thereunder, specifically Article 4, Paragraph 1, Article 12, Paragraph 1, and Paragraph 3. Accordingly, a fine of NT$2 million is imposed under Article 129, Clause 7 of the same Act. 4. Handling Process: The Bank will carry out relevant improvement measures in accordance with the regulatory authority's recommendations. 5. Penalty Imposed: A fine of NT$2,000,000. 6. Was a penalty imposed: Yes 7. Amount of Penalty (NT$): NT$2,000,000 8. Estimated Potential Loss or Impact: NT$2,000,000. 9. Amount Potentially Covered by Insurance (NT$): None 10. Improvement Status and Future Measures: The Bank will implement improvement measures as directed by the regulatory authority. Business operations remain normal. 11. Has a major announcement on the same event been previously issued: No 12. Other Matters to be Disclosed: None