The Financial Supervisory Commission (FSC) issued an interpretative letter forsubparagraph 6 of Article 2 of the Regulations Governing Use of Insurer's Funds in Special Projects, Public Utilities and Social Welfare Enterprises (the "Regulations"), Ref. No. Jin-Guan-Bao-Cai-Zi No.10704505101 dated December 7, 2018. Relevant rules are explained as follows:

A.The "other use in line with government policies" stated in subparagraph 6 of Article 2 of the Regulations refers to the insurer operating the lending business which is guaranteed by a credit guarantee institution incorporated by a foreign central government and acting as a participant in syndicated loans and meeting the following requirements:

1.The purpose of the loan is for investing in matters listed in point 1 of the FSC interpretative letter, Ref. No. Jin-Guan-Bao-Cai-Zi No. 10610908021 dated March 21, 2017.

2.The insurer shall assess the financial position of the credit guarantee institution to determine whether it has adequate resources to cover the secured debt payments and set risk limits to implement risk management.

3.With formal guarantee documents, the credit guarantee institution may directly request to perform the guarantee responsibility when the debtor fails to pay the debt.

4.The guarantee liability of the credit guarantee institution shall be unconditional and irrevocable until the secured loan is repaid in full.

B.When the insurer operates the lending business under Point A, the loan amount shall be calculated in accordance with subparagraph 1 of paragraph 1 of Article 7 of the Regulations, and the total amount of loans and investment of the same borrower shall not exceed 5% of the insurer's funds.

C.When the insurer operates the lending business under Point A, subparagraph 4 of paragraph 1 of Article 10 shall apply mutatis mutandis, and the insurer may operate the lending business within the scope of the resolutions of board meeting or its authorization, but shall still prepare the following documents to be available for the competent authority for post audits. The competent authority may regularly check the insurer's lending status, and limit or review the lending status depending on the socio-economic situation and its actual performance:

1.Lending plan (including the analysis of market outlook, ownership structure and management team of borrower, loan terms, lending period, method of repayment of principal and interest and time schedule, purpose of funds, repayment source and repayment capacity).

2.Details of the investment and lending and performance analysis of the use of insurer's funds in special projects, public utilities and social welfare enterprises.

3.The creditor protection measures (including confirmation of the suitability of the credit guarantee institution and related guarantee documents, etc.)

4.Financial statements of the borrower. However, if the borrower is incorporated for less than one year, it would be exempted.

5.Resolutions of the board meeting or its authorization documents.

6.Documents reviewed by relevant authorities.

7.Other data required by the competent authorities.