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As of December 31, 2015 and 2014, the outstanding balances of the above mentioned financial bonds amounted to US$500 million and
US$500 million, and NT$36.2 billion and NT$54 billion, respectively. In addition, among the above financial bonds, the senior financial
bonds with face value of US$500 million and US$500 million and the subordinate financial bonds with face value of NT$0 and NT$3.8 billion
were designated as financial liabilities at fair value through profit or loss and hedged by interest rate swap contracts. As such interest rate
swap contracts were valued at fair value with changes in fair value recognised as profit or loss, the financial bonds stated above were designated
as financial liabilities at fair value through profit or loss in order to eliminate or significantly reduce recognition inconsistency.
(19)
Provisions
December 31, 2015
NT$
US$
Liabilities reserve for employee benefits
$
8,682,538 $
264,003
Reserve for guarantee liabilities
3,240,886
98,543
Total
$
11,923,424 $
362,546
December 31, 2014
January 1, 2014
NT$
NT$
Liabilities reserve for employee benefits
$
7,248,658 $
7,300,262
Reserve for guarantee liabilities
3,204,543
3,562,797
Total
$
10,453,201 $
10,863,059
In 2015, the Bank and its subsidiaries adopted IAS 19 of the 2013 version of IFRSs as endorsed by the FSC. Liabilities reserve for employee
benefits as at December 31, 2014 and January 1, 2014 was retroactively adjusted from NT$6,915,679 thousand and NT$6,946,341 thousand,
respectively, to NT$7,248,658 thousand and NT$7,300,262 thousand, respectively.
Liabilities reserve for employee benefits are as follows:
December 31, 2015
NT$
US$
Recognised in consolidated balance sheet:
- Defined benefit plans
$
5,579,717 $
169,658
- Employee preferential savings plans
3,102,821
94,345
Total
$
8,682,538 $
264,003
December 31, 2014
January 1, 2014
NT$
NT$
Recognised in consolidated balance sheet:
- Defined benefit plans
$
4,415,698 $
4,698,013
- Employee preferential savings plans
2,832,960
2,602,249
Total
$
7,248,658 $
7,300,262
A.
Defined contribution plans
Effective July 1, 2005, the Bank has established a funded defined contribution pension plan (the “New Plan”) under the Labor Pension
Act (the “Act”). Employees have the option to be covered under the New Plan. Under the New Plan, the Bank contributes monthly an
amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor
Insurance. The payment of pension benefits is based on the employees’ individual pension fund accounts and the cumulative profit in
such accounts, and the employees can choose to receive such pension benefits monthly or in lump sum. The pension costs under the
defined contribution pension plan for the years ended December 31, 2015and 2014 were NT$83,678 thousand and NT$77,473 thousand,
respectively.
For employees working overseas, pension expenses under defined contribution plans are recognised according to the local regulations.
For the years ended December 31, 2015 and 2014, pension expenses of current period were NT$21,205 thousand and NT$23,100 thousand,
respectively.
B.
Defined benefit plans
(A)
The Bank has a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service
years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to
continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for
each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension
benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement.
The Bank and its subsidiaries contribute monthly an amount equal to 8.211% of the employees’ monthly salaries and wages to the
retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. Also,
the Bank would assess the balance in the aforementioned labor pension reserve account by the end of December 31, every year. If
the account balance is insufficient to pay the pension calculated by the aforementioned method, to the employees expected to be
qualified for retirement next year, the Bank will make contributions to cover the deficit by next March.
(B)
The amounts recognised in the balance sheet are determined as follows:
December 31, 2015
December 31, 2014
NT$
US$
NT$
Present value of funded obligations
$
15,759,783 $
479,195 $
14,491,116
Fair value of plan assets
(
10,180,066 ) (
309,537 ) (
10,075,418 )
$
5,579,717 $
169,658 $
4,415,698