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Article 9
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The section on risks shall set forth the following information: 1.Drivers of risk: The prospectus shall analyze and evaluate the following matters during the preceding fiscal year and in the current fiscal year up to the date of the publication of the prospectus: A.External drivers of risk: a.Effect upon the company's financial and business affairs of changes in important government policies, laws, and financial accounting standards at home and abroad, as well as response measures being or to be taken. b.Effect of changes in the financial and business climate at home and abroad upon the company's financial and business affairs, as well as response measures being or to be taken. c.Effect of changes in market competition at home and abroad upon the company's financial and business affairs, as well as response measures being or to be taken. d.Effect of changes in real estate market price levels upon the value of mortgage collateral and the quality of credit assets, as well as response measures being or to be taken. e.Effect of differences between laws and regulations at home and abroad upon the current offering and issuance of securities.
f. The impact on the company's financial operations of developments in science and technology (including cyber security risk), and the measures the company plans to adopt in response. B.Drivers of operational risk: a.Organizational framework and policies for risk management. b.Methods for measuring and controlling risks, and exposure quantification information. c.Asset quality: With respect to the most recent two fiscal years, provide the dollar amount of non-performing credit, credit risk concentrations, a maturity analysis of assets and liabilities, and sensitivity to market risk. (Attachments 2 to 5) d.Research and development plans for the future, and expenditures expected for research and development work. e.Effect of the company's investment activities on its financial and business affairs. f.Expected benefits and risks associated with any expansion of business locations, and any response measures being or to be taken. g.Risks associated with any concentration of business, and response measures being
or to be taken. h.Effect of possible material changes expected in the company's principal businesses (including types of business, transaction volume, and revenues), and mitigation measures being or to be taken. i.Effect upon and risk to the company associated with any change in managerial control, and response measures being or to be taken. j.Effect upon and risk to the company if a large quantity of shareholding of a director, supervisor, or 1 percent or greater shareholder in the company were to be transferred or otherwise change hands, and measures to be adopted in response. k.Expected benefits of any mergers or acquisitions, as well as possible risks and any response measures being or to be taken. l.Effect of employee infidelity or errors upon the company's financial and business affairs, as well as response measures being or to be taken. m.Effect of damage to information systems upon the company's financial and business affairs, as well as response measures being or to be taken. n.Effect of financial holding company group business operations upon the company's financial and business affairs, as well as response measures being or to be taken. C.Other drivers of risk: a.Current credit rating and changes therein over the preceding two fiscal years. b.Effect of any change to corporate image upon the company, as well as response measures being or to be taken. c.Other important risks and any response measures being or to be taken. 2.Litigious and non-litigious matters: A.For litigious or non-litigious proceedings or administrative disputes involving the company with respect to which a judgment has become final and unappealable in the most recent two fiscal years or in the current year up to the date of publication of the prospectus, and for any such matter still pending, if the outcome could materially impact shareholders' equity or the prices of the company's securities, the prospectus shall list the facts of the dispute, amount of money at stake in the dispute, the date of commencement of proceedings, the main parties to the dispute, and current status of the dispute's handling. B.For litigious or non-litigious proceedings or administrative disputes involving a company director, supervisor, the general manager, a de facto responsible person, a 1 percent or greater major shareholder, or a controlled company, if a judgment has become final and unappealable in the most recent two fiscal years or in the current year up to the date of publication of the prospectus, or if such a matter is still pending, if the outcome could materially impact shareholders' equity or the prices of the company's securities, the information to be disclosed shall be the same as that
set forth in the preceding item. C.Where any of the situations set out under Article 157 of the Securities and Exchange Act has occurred with respect to a company director, supervisor, managerial officer, or 10 percent or greater major shareholder within the preceding two fiscal years, or in the current year up to the date of publication of the prospectus, the prospectus shall indicate that fact and describe the current status of the company's handling of the matter. 3.If a company director, supervisor, managerial officer, or 1 percent or greater major shareholder or more has experienced financial difficulties or loss of creditworthiness in the most recent two fiscal years, or in the current year up to the date of publication of the prospectus, the prospectus shall indicate the impact on the company's financial status. 4.Other matters of important significance.
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Article 22
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The section on investee enterprises shall include the following items:
1.Overview of investee enterprises: Describing the names of investee enterprises, the businesses engaged in, the cost of the company's investments in such investee enterprises, book value, number of shares held, percentage of shareholding, net worth of shares, accounting treatment method, book investment profit and loss for the most recent year, distributed cash dividends and the number of the company's shares held by each investee enterprise. If there is market value information available on the investee enterprise, such market value information shall also be included. (Attachment 51)
2.Consolidated shareholding percentage: Set forth the following information on each investee enterprise: the number of shares held by the company, the number of shares held by the company's directors, supervisors, the personnel whose positions are managerial or higher, and the number of shares of the same investee enterprise which are held by the entities directly or indirectly controlled by the company. Calculate the consolidated shareholding percentage of the above categories. (Attachment 52)
3.For an exchange-listed or OTC-listed company, disclose the status of acquisition and disposal of the shares of the company by the subsidiary(ies) and the condition of pledge created for the most recent three years and up to the prospectus' publication date. The sources of funds and the impact on the company's financial performance and financial position shall also be revealed. (Attachment 53)
4.In the event of occurrence of the situations under Article 185 of the Company Act or transfer of a portion of the operations to the subsidiary(ies) for the most recent three years and up to the publication date of the prospectus, disclose any waiver of subscription related to the cash capital increase of the subsidiary(ies), the name of the subscriber, its relationship with the company, directors, supervisors, and shareholders holding 1% or more of the shares, and the number of shares subscribed.
5.List any sanctions imposed for violation of laws and regulations on the investee enterprise in which the company has invested an amount of more than 50% of the paid-in capital of such invested company, and corrective actions taken in the most recent two years.
The definition of subsidiaries under subparagraphs 3 and 4 of the preceding paragraph shall be determined by the regulations governing the preparation of financial reports for the relevant industry.
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