Mega Bank Annual Report 2017

66 Mega Bank -66- D. Reserve for guarantee liabilities The Bank had provided appropriate reserve for guarantee liabilities based on the guarantee reserve assessed. The details and movements of reserve for guarantee liabilities for the years ended December 31, 2017 and 2016 are as follows: 2017 2016 NT$ US$ NT$ Balance at January 1 $ 3,691,076 $ 124,497 $ 3,240,886 Provision ( 26,187 ) ( 883 ) 452,003 Effects of exchange rate changes and others ( 5,055 ) ( 171 ) ( 1,813 ) Balance at December 31 $ 3,659,834 $ 123,443 $ 3,691,076 (20) Other financial liabilities December 31, 2017 December 31, 2016 NT$ US$ NT$ Appropriation for loans $ 1,307,089 $ 44,087 $ 1,529,903 Structured deposits 7,662,552 258,451 7,054,086 Total $ 8,969,641 $ 302,538 $ 8,583,989 (21) Other liabilities December 31, 2017 December 31, 2016 NT$ US$ NT$ Deposits received $ 2,724,103 $ 91,882 $ 1,525,090 Advance receipt 1,623,079 54,745 1,823,612 Temporary credits 1,370,928 46,240 1,145,758 Other liabilities to be settled 402,773 13,585 431,815 Others 298,587 10,071 332,072 Total $ 6,419,470 $ 216,523 $ 5,258,347 (22) Equity A. Common stock As of December 31, 2017 and 2016, the Bank’s authorized and paid -in capital was NT$85,362,336 thousand and outstanding shares were 8,536,234 thousand, with a par value of NT$10 per share. B. Capital reserve (A) Pursuant to the R.O.C. Company Act, capital surplus arising from paid-in capital in excess of par value on issuance of common stocks and donations can be used to cover accumulated deficit or to issue new stocks or cash to shareholders in proportion to their share ownership, provided that the Bank has no accumulated deficit. Further, the R.O.C. Securities and Exchange Law requires that the amount of capital surplus to be capitalised mentioned above should not exceed 10% of the paid-in capital each year. Capital surplus should not be used to cover accumulated deficit unless the legal reserve is insufficient. (B) On December 31, 2017 and 2016, the details of the Bank’s capital surplus are as follows: December 31, 2017 December 31, 2016 NT$ US$ NT$ Capital increase by cash – additional paid-in capital $ 31,495,952 $ 1,062,330 $ 31,495,952 Consolidation surplus arising from share conversion 30,109,277 1,015,558 30,109,277 Changes in additional paid-in capital of investees accounted for by the equity method 375,908 12,679 375,908 Share-based payment (Note) 238,403 8,041 238,403 Total $ 62,219,540 $ 2,098,608 $ 62,219,540 Note: above-mentioned share-based payment includes the subsidiaries. C. Legal reserve and Special reserve (A) Legal reserve Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Bank’s paid - in capital. As of December 31, 2017 and 2016, the Bank’s legal reserves are NT$79,690,847 thousand and NT$73,987,859 thousand, respectively. (B) Special reserve In accordance with Financial-Supervisory-Securities-Corporate No. 1010012865 of the FSC dated on April 6, 2012, upon the first- time adoption for IFRSs, equivalent amounts of special reserve with regard to the unrealized revaluation increment under the stockholders’ equity and cumulative translation adj ustment (gains) transferred to retained earnings should be set aside. For the said special reserve, reversal of distributed earnings shall be based on the proportion of the original ratio of special reserve provision in