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Operating Rules for Securities Business Money Lending by Securities Firms  CH

Amended Date: 2021.04.01 (Articles 19 amended,English version coming soon)
Current English version amended on 2020.12.31 
Categories: Securities Exchange Market > Borrowing of Money

Title: Operating Rules for Securities Business Money Lending by Securities Firms(2008.09.03)
Article 13 In securities business money lending conducted by a securities firm, if the customer intends to post collateral in the form of securities that it is purchasing, the customer shall file an application by 11:00 a.m. on the second business day after the transaction date, and have the securities firm or custodian institution transfer the customer's purchased securities into the loan collateral account opened by the securities firm at the Taiwan Depository & Clearing Corporation (TDCC); the financing period shall be from the second business day after the transaction date to the fifth business day after the transaction date.
When the customer of the preceding paragraph submits the loan application by a method other than in person, it shall submit a written statement of consent for exemption from the use of a signature or seal on the loan application. If the securities firm has verified and kept that consent statement on file, it is not necessary for the customer to sign/seal the application.
When a customer applies to borrow money from a securities firm by personal telephone call, the securities firm shall make a synchronous recording of the call, which shall be kept at its place of business and retained for at least two months. In the event of any dispute, the recording shall be retained until the dispute has been eliminated.
The value of the collateral in paragraph 1 shall be confined to 100 percent to 120 percent of the monetary amount of the financing provided to the customer by the securities firm. The value of the collateral shall be calculated as the financing date's closing price or the GTSM-posted next day's reference price ("reference price") or as 80 percent of the face value of government strip bonds.
Where a customer files an application pursuant to paragraph 1 herein and is notified by the securities firm to post collateral in the form of exchange-listed or OTC-listed securities or government strip bonds that it holds, the application-related provisions of paragraph 1 shall apply mutatis mutandis.
When a customer makes partial repayment prior to the expiration of the financing period, the securities firm shall return to the customer the securities it originally posted as collateral on a proportional basis, provided that increments of less than one trading unit may not be returned.