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In accordance with the regulations, the Bank shall set aside an equivalent amount of special reserve from earnings after tax of the
current year and the undistributed earnings of the prior period based on the net decreased amount of other stockholders’ equity in
the current period before distributing earnings. If there is any reversal of decrease in other stockholders’ equity, the earnings may be
distributed based on the reversal proportion.
(23)
Retained earnings and dividend policies
A.
The current year’s earnings, if any, shall first be used to pay all taxes and offset prior year’s operating loss, and the remaining amount
should then be set aside as legal reserve and special reserve in accordance with provisions under the applicable laws and regulations.
2.4% of the remaining earnings (including reversible special reserve) are then distributed as bonuses to employees, and the remaining
earnings plus prior year’s accumulated unappropriated earnings are subject to the Board of Directors’ proposal for a distribution plan and
approval by the stockholders at the Ordinary Stockholders’ Meeting.
However, in accordance with the Company Act amended in May 20, 2015, a company shall distribute employee compensation, based on
the distributable profit of the current year, in a fixed amount or a ratio of profits. Bonuses to employees does not belong to surplus earning
distribution. The information of amended Articles of Incorporation of the Bank is disclosed in Note 6(31).
B.
The legal reserve is to be used exclusively to offset any deficit or to increase capital by issuing new shares or distribute cash dividends
according to original shareholders in proportion to the number of shares being held by each of them and is not to be used for any other
purposes. For the legal reserve to be used for issuing new shares or distributing cash dividends, only the portion of the legal reserve
exceeding 25% of paid-in capital may be capitalized or released.
C.
Shareholders other than those not living in ROC have imputation tax credit for the distribution of earnings after (in) 1998 based on the
creditable tax rate on the dividend declaration day.
As of December 31, 2015 and 2014, cumulative unappropriated retained earnings recorded in the books were all earnings generated in
and after 1998.
D.
The appropriations and distributions for 2014 and 2013 approved by the Bank’s Board of Directors on the stockholders’ behalf on April
24, 2015 and May 9, 2014, respectively, were as follows
：
2014
2013
NT$
NT$
Legal reserve
$
7,791,990 $
5,641,811
Special reserve (Note)
25,253
40,081
Cash dividends (NT$1.44 and NT$1.45 dollar per share)
11,088,000
11,165,000
$
18,905,243 $
16,846,892
Note: The Bank in accordance with the description in Note 6(22)C(B) of the relevant provisions for special reserves, reversed special
reserve of NT$2,640 thousand and NT$214,773 thousand, for the years ended December 31, 2014 and 2013, respectively.
Information on the appropriation of the Bank’s earnings as approved by the Board of Directors and during the shareholders’ meeting is
posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.
E.
The appropriation of 2015 earnings resolved by the Board of Directors on March 25, 2016 is set forth below:
2015
NT$
Legal reserve
$
7,712,534
Special reserve
28,478
Cash dividends (NT$1.50 dollar per share)
12,804,350
$
20,545,362
F.
For information related to employees’ bonus (compensation), please refer to Note 6(31)
。
(24)
Other equity
Cumulative
translation
differences of foreign
operations
Available-for-sale
financial assets
Total
NT$
January 1, 2015
$
$550,023 $
2,239,841 $
2,789,864
Available-for-sale financial assets
Evaluation adjustment for the year
- (
1,474,828 ) (
1,474,828 )
Realized gain and loss for the year
- (
886,419 ) (
886,419 )
Cumulative translation differences of foreign operations
(
221,299 )
- (
221,299 )
Share of other comprehensive income of associates and joint
ventures accounted for under equity method
2,639
19,059
21,698
December 31, 2015
$
331,363 ( $
102,347 ) $
229,016