Cathay Asset Management Recalculates NAVs for 8 Funds and Bears Full Compensation Costs

(Central News Agency reporter Tseng Jen-kai, Taipei, June 17) Cathay Asset Management announced on the 15th that during a routine review process, it discovered that eight funds, including the Cathay China Fund and Cathay Small-Mid Growth Fund, did not comply with regulations. As a result, the fund net asset values (NAVs) have been recalculated, and investors will be compensated based on the revised NAVs. All compensation costs will be fully borne by Cathay Asset Management, with no impact on fund assets or the rights and interests of other investors.

Cathay Asset Management issued a supplementary statement today, explaining that the NAV recalculation for the eight funds was initiated after identifying that certain fund investments did not meet the investment restrictions stipulated in the Securities Investment Trust Fund Management Regulations. The fund gains and losses during the affected period have been recalculated, and investor compensation will be handled under a beneficiary-first principle. All related compensation and derivative costs will be fully covered by Cathay Asset Management. This action has no impact on fund NAVs, fund assets, or investor rights, and does not constitute a suspension of NAV calculation, material error correction, or other special matters required under the fund agreements or by law.

According to Cathay Asset Management's announcement, the eight funds undergoing NAV recalculation are: Cathay China Fund, Cathay Small-Mid Growth Fund, Cathay Greater China Fund, Cathay Technology & Biotech Fund, Cathay Dragon Fund, Cathay China-Hong Kong-Taiwan Fund, Cathay China Domestic Demand Growth Fund, and Cathay Taiwan High Dividend Fund. The affected period ranges from as early as June 30, 2025, to as late as January 20 of this year.

Cathay Asset Management stated that to protect investor rights and accurately reflect fund asset values, it has recalculated the NAVs for the affected period and will compensate investors based on the revised NAVs.

Cathay Asset Management noted that subscriptions, redemptions, and holdings processed based on NAVs during the affected period will be compensated using the revised NAVs, with interest accrued up to June 30 of this year added. If the recalculation affects individual investor rights, Cathay will handle compensation and notification under a beneficiary-first principle.

Adjustment principles include: units or redemption amounts already paid out will remain unchanged and will not be reclaimed by Cathay Asset Management; any shortfall in units or redemption amounts will be compensated in cash to investors by Cathay; and investors holding funds as of the last affected date will receive cash compensation based on the number of units held and the NAV difference on that day.

Cathay Asset Management stated that after completing the recalculation, it has confirmed the NAVs and related transaction data for the affected period and is proceeding with follow-up actions based on the revised results. The actual timing of fund crediting may vary slightly depending on the subscription channel and sales institutions, all to ensure the protection of all investors' rights. (Editor: Lin Chia-hsien) 1150617