Taishin Financial : 2022 3Q consolidated financial statements

Taishin Financial Holding Co., Ltd. and Subsidiaries

Consolidated Financial Statements for the

Nine Months Ended September 30, 2022 and 2021 and Independent Auditors' Review Report

INDEPENDENT AUDITORS' REVIEW REPORT

The Board of Directors and Shareholders

Taishin Financial Holding Co., Ltd.

Introduction

We have reviewed the accompanying consolidated balance sheets of Taishin Financial Holding Co., Ltd. ("Taishin Financial Holding") and its subsidiaries (collectively, the "Group") as of September 30, 2022 and 2021, the related consolidated statements of comprehensive income for the three months ended September 30, 2022 and 2021 and for the nine months ended September 30, 2022 and 2021, the consolidated statements of changes in equity and cash flows for the nine months then ended, and the related notes to the consolidated financial statements, including a summary of significant accounting policies (collectively referred to as the "consolidated financial statements"). Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Financial Holding Companies, the Regulations Governing the Preparation of Financial Reports by Public Banks, the Regulations Governing the Preparation of Financial Reports by Securities Firms, the Regulations Governing the Preparation of Financial Reports by Futures Commission Merchants, the Regulations Governing the Preparation of Financial Reports by Securities Issuers, the Regulations Governing the Preparation of Financial Reports by Insurance Enterprises, and International Accounting Standard 34 "Interim Financial Reporting" endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Scope of Review

We conducted our reviews in accordance with Statement of Auditing Standards No. 65 "Review of Financial Information Performed by the Independent Auditor of the Entity". A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our reviews, nothing has come to our attention that caused us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as of September 30, 2022 and 2021, its consolidated financial performance for the three months ended September 30, 2022 and 2021 and its consolidated financial performance and its consolidated cash flows for the nine months ended September 30, 2022 and 2021 in accordance with the Regulations Governing the Preparation of Financial Reports by Financial Holding Companies, the Regulations Governing the Preparation of Financial Reports by Public Banks, the Regulations Governing the Preparation of Financial Reports by Securities Firms, the Regulations Governing the Preparation of Financial Reports by Futures Commission Merchants, the Regulations Governing the Preparation of Financial Reports by

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Securities Issuers, the Regulations Governing the Preparation of Financial Reports by Insurance Enterprises, and International Accounting Standard 34 "Interim Financial Reporting" endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

The engagement partners on the reviews resulting in this independent auditors' review report are Han-Ni Fang and Ching-Cheng Yang.

Deloitte & Touche

Taipei, Taiwan

Republic of China

November 17, 2022

Notice to Readers

The accompanying consolidated financial statements are intended only to present the consolidated financial position, financial performance and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to review such consolidated financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors' review report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors' review report and consolidated financial statements shall prevail.

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TAISHIN FINANCIAL HOLDING CO., LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (In Thousands of New Taiwan Dollars)

			September 30, 2022						December 31, 2021						September 30, 2021
			(Reviewed)						(Audited)						(Restated - Note 43)
ASSETS			Amount	%					Amount	%					Amount	%
Cash and cash equivalents (Note 7)	$	34,438,618		1		$	27,561,283	1		$	36,291,205		2
Due from the Central Bank and call loans to banks (Note 8)			96,773,180		4					86,817,297	4					69,078,394		3
Financial assets at fair value through profit or loss (FVTPL) (Note 9)			202,763,049			8					150,375,077	6					136,187,880		6
Financial assets at fair value through other comprehensive income (FVTOCI) (Note 10)			147,186,403			6					176,881,749	7					169,362,515		7
Financial assets in debt instruments at amortized cost (Note 11)			556,695,496			20					461,273,302	18				451,709,647		18
Securities purchased under resale agreements			9,848,528		-					10,859,842	-					9,026,475		-
Receivables, net (Notes 12 and 13)			160,401,991			6					180,655,171	7					176,001,150		7
Current tax assets (Note 41)			101,579		-					291,168	-					289,877		-
Loans, net (Note 13)			1,432,082,968			52					1,327,126,117	53				1,339,633,066		54
Reinsurance contract assets, net			470,713		-					503,918	-					431,226		-
Investments accounted for using the equity method, net (Note 14)			339,420		-					351,147	-					83,720		-
Other financial assets, net (Notes 13, 15 and 31)			34,411,718		1					36,450,354	2					31,957,240		1
Investment properties, net (Note 16)			2,846,087		-					2,858,617	-					2,858,743		-
Property and equipment, net (Note 17)			22,317,604		1					22,469,854	1					22,490,949		1
Right-of-use assets, net (Note 18)			2,321,804		-					2,573,461	-					2,695,310		-
Intangible assets, net (Note 19)			3,466,048		-					3,284,761	-					3,240,539		-
Deferred tax assets (Note 41)			7,685,319		-					8,325,121	-					8,034,541		-
Other assets, net (Note 20)			31,243,663		1					13,902,250	1					12,617,208		1
TOTAL		$	2,745,394,188			100			$	2,512,560,489	100	$	2,471,989,685		100
LIABILITIES AND EQUITY
Deposits from the Central Bank and banks (Note 21)	$	24,916,693		1		$	57,075,272	2		$	47,337,652		2
Due to the Central Bank and banks			-			-					3,984,460	-					4,716,970		-
Financial liabilities at FVTPL (Note 9)			96,902,350		4					31,940,397	1					29,672,485		1
Securities sold under repurchase agreements			103,903,403			4					86,210,606	3					76,274,972		3
Commercial papers issued, net (Note 22)			18,798,911		1					22,963,111	1					20,045,868		1
Payables (Note 23)			38,242,012		1					34,536,010	1					43,397,897		2
Current tax liabilities (Note 41)			1,467,803		-					2,360,788	-					2,044,509		-
Deposits and remittances (Note 24)			1,821,583,867		66					1,681,331,592	67				1,671,791,775		68
Bonds payable (Note 25)			74,788,863		3					70,100,000	3					70,100,000		3
Other borrowings (Note 26)			12,868,085		1					12,867,620	1					12,698,391		-
Provisions (Notes 27 and 28)			222,167,871			8					200,846,734	8					195,068,264		8
Other financial liabilities (Notes 29 and 31)			120,275,056			4					92,423,614	4					92,984,324		4
Lease liabilities (Note 18)			2,422,368		-					2,653,717	-					2,769,865		-
Deferred tax liabilities (Note 41)			1,786,661		-					1,087,573	-					1,126,336		-
Other liabilities (Note 30)			11,715,356		-					14,077,667	1					7,076,112		-
Total liabilities			2,551,839,299			93					2,314,459,161	92				2,277,105,420		92
EQUITY ATTRIBUTABLE TO OWNERS OF PARENT (Note 33)
Share capital
Ordinary shares			119,741,476			4					114,093,832	5					114,093,832		5
Preferred shares			11,000,000		1					8,000,000	-					8,000,000		-
Capital surplus			38,197,778		1					35,921,647	1					35,921,647		1
Retained earnings
Legal reserve			15,244,071		1					13,196,771	1					13,196,771		1
Special reserve			8,698,118		-					393,716	-					393,716		-
Unappropriated earnings			10,425,821		-					25,110,517	1					22,851,730		1
Other equity			(9,777,862)		-					1,350,795	-					389,440		-
Total equity attributable to owners of parent			193,529,402			7					198,067,278	8					194,847,136		8
NON-CONTROLLING INTERESTS			25,487		-					34,050	-					37,129		-
Total equity			193,554,889			7					198,101,328	8					194,884,265		8
TOTAL		$	2,745,394,188			100			$	2,512,560,489	100	$	2,471,989,685		100

The accompanying notes are an integral part of the consolidated financial statements.

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TAISHIN FINANCIAL HOLDING CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

		For the Three Months Ended September 30					For the Nine Months Ended September 30
	2022				2021 (Restated - Note 43)	2022				2021 (Restated - Note 43)
		Amount	%				Amount	%				Amount	%				Amount	%
INTEREST INCOME
(Note 34)	$ 12,491,270	76	$ 8,541,257		44	$ 31,342,666	66	$ 24,065,592		51
INTEREST EXPENSES
(Note 34)	(4,889,968)	(30)	(2,015,260)		(10)	(9,943,989)	(21)	(6,260,877)		(13)
NET INTEREST INCOME
(Note 34)	7,601,302	46	6,525,997		34	21,398,677	45	17,804,715		38
NET INCOME OTHER
THAN NET INTEREST
INCOME
Net service fee and
commission income
(Note 35)	3,321,874	20	4,165,977		22	9,725,806	21	12,031,151		25
Net income from insurance
operations (Note 36)	3,037,439	19	5,568,676		29	12,537,716	26	5,568,676		12
Gains (losses) on financial
assets and liabilities at
FVTPL (Note 37)	(2,255,144)	(14)	804,846		4		(5,293,350)	(11)	3,352,083		7
Realized gains on financial
assets at FVTOCI
(Note 38)	554,729	3		1,673,445		9		191,275	-		2,090,893		4
Gains (losses) on
derecognition of financial
assets in debt instruments
at amortized cost	54	-		121,240		-		(619,522)	(1)	121,024		-
Foreign exchange gains
(losses)	3,405,501	21	(38,774)		-		4,682,310	10	(23,969)		-
(Impairment losses on
assets) reversal of
impairment losses on
assets (Notes 10, 11
and 20)	21,957	-		(31,062)		-		8,586	-		(33,708)		-
Share of profits (losses) of
associates accounted for
using the equity method
(Note 14)	(281)	-		1,945		-		6,353	-		(3,550,653)		(7)
Gains (losses) on
reclassification using the
overlay approach
(Note 9)	972,823	6		329,341		2		5,265,507	11	329,341		1
Net other non-interest
income
Gains from bargain
purchase (Note 43)	-		-		-			-		-	-		9,227,113		19
Net other miscellaneous
income	(235,022)	(1)	104,157		-		(501,294)	(1)	354,368		1
Total net income other
than net interest
income		8,823,930	54	12,699,791		66	26,003,387	55	29,466,319		62
																						(Continued)

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