FSC Inspects Cathay Financial and 4 Subsidiaries to Clarify Group's Related Party Reporting Mechanism

(CNA) - Following the controversy over improper related party investments by Cathay Securities Investment Trust (SITE), the Financial Supervisory Commission (FSC) has not only dispatched personnel to inspect Cathay SITE but also announced today that it has sent teams to Cathay Financial Holding, Cathay Bank, Cathay Life, Cathay Insurance, and Cathay Securities to conduct on-site investigations. This move aims to clarify the group's reporting and control mechanisms for related parties.

Guo Ming-jian, former chairman of Cathay Bank, previously served as a director at Cathay SITE. Starting May 29 last year, he also became an independent director at Alchip Technologies Ltd. Due to internal oversights at Cathay SITE, funds and managed accounts under the trust invested in Alchip Technologies Ltd. stock, crossing the line for related party transactions. Cathay SITE subsequently announced the recalculation of net asset values for 8 funds. Amidst the ongoing fallout, Guo Ming-jian recently resigned as chairman of Cathay Bank, and the FSC's Examination Bureau dispatched personnel to inspect Cathay SITE.

The FSC stated that inspections at Cathay SITE began on June 22 and are expected to conclude by July 8, with possible extensions if necessary. Today, the FSC further indicated that teams were dispatched to Cathay Financial Holding, Cathay Bank, Cathay Life, Cathay Insurance, and Cathay Securities for on-site understanding. (Editor: Lin Shu-yuan) 1150702

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