FEIB — Management Reports 2021

Apr 9, 2021

==> picture [458 x 540] intentionally omitted <==

==> picture [82 x 91] intentionally omitted <==

Investor Conference

Y2020

==> picture [186 x 42] intentionally omitted <==

4/7’2021

==> picture [62 x 69] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

Far Eastern Group

==> picture [238 x 113] intentionally omitted <==

• Established in 1937

• Span over 10 major industries

• 9 public listed companies in Taiwan and HK

• Total Asset of NT$2,848 Bn (YE2020)

==> picture [118 x 47] intentionally omitted <==

Petrochemical & energy

• 11 companies in operation across Taiwan and China

• – Oriental Petrochemical has manufacturing lines in Taiwan and mainland China with over 2.75 million tons annual PTA capacity

==> picture [118 x 53] intentionally omitted <==

Polyester & synthetic fiber

• 38 companies in operation across Taiwan, China, Vietnam and USA

• – and Group’s polyester capacity over 2.72 million tons, one of the world's 3 largest manufacturers

==> picture [116 x 50] intentionally omitted <==

Cement & building material

• 30subsidiaries integrating Taiwan and China markets

• Main operation unit Asia Cement to achieved 41 m tons of annual capacity, ranking up to Top 10 in China

==> picture [118 x 50] intentionally omitted <==

Retail & department store

• Together owns 46 stores across both sides of Strait

• Total sales surpassed NT$ 115 billion

==> picture [117 x 49] intentionally omitted <==

Financial services

• 14 companies in operation across multiple financial service fields, in Taiwan and China

• FEIB is the flagship operating entity

==> picture [116 x 49] intentionally omitted <==

Sea/Land transportation

• 14 subsidiaries in operation

• Flagship U-Ming Marine Transport has 48 vessels and a shipping capacity of 6.71 million DWT

==> picture [118 x 49] intentionally omitted <==

Communications and Internet

• The only one pure mobile operator in Taiwan

• FET obtained 3.5Ghz and 28Ghz 5G license

• Invested in FETC, more than 7 million vehicles have installed OBUs and over 1.8 billion tolls collected.

==> picture [117 x 49] intentionally omitted <==

Construction

• 4 subsidiaries in operation

• Projects in development such as "Far Eastern Telecom Park" and Yilan Resort

==> picture [118 x 49] intentionally omitted <==

Hotel services

• Shangri-La's Far Eastern Plaza Hotel Taipei

• Far Eastern Plaza Hotel Tainan

• Awarded "The 500 Best Hotels in the World"

==> picture [117 x 49] intentionally omitted <==

Philanthropic organizations

• Established Yuan Ze University

• Oriental Institute of Technology

• Founded Far Eastern memorial Hospital

• Far Eastern Polyclinic

• Yu Chang Technical & Commercial Vocational Senior High School

2

Contents

==> picture [285 x 95] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

==> picture [194 x 87] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

3

Assets & Net worth

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

==> picture [482 x 363] intentionally omitted <==

----- Start of picture text -----

 Assets  Net Worth
(NT$Bn) (NT$Bn)
YoY
+3.8%
680
655
627
36
36 40 45
33
36
38
0
198 221 12
177
33
380 385 383
2018 2019 2020 2018
----- End of picture text -----

==> picture [271 x 326] intentionally omitted <==

----- Start of picture text -----

YoY
+3.1%
49
47
45
1
0
0
13
13
12
33 34 35
2018 2019 2020
----- End of picture text -----

 Loan  Investment  Cash & Deposit  AR & Others

• Capital + Capital Surplus  Retain Earnings & Others

4

 OCI

Source: :Consolidated audited financial report

Loans & Deposit

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

==> picture [467 x 399] intentionally omitted <==

----- Start of picture text -----

 Gross Loan  Deposit
(NT$Bn) (NT$Bn)
YoY
-0.3%
385 390 389
508
68
97 99 102
33
124 128 129
299
64 59 50
32 27 37
68 77 70 108
2018 2019 2020 2018
 Local Corp  Local SME  Overseas
 LCY D.D. 
 Mortgage (Home purchase)  Consumer Finance
----- End of picture text -----

==> picture [293 x 355] intentionally omitted <==

----- Start of picture text -----

YoY
+8.3%
583
537
508 46
64 71
68
32
33
330
320
299
108 121 136
2018 2019 2020
 LCY D.D.  LCY T.D.  FCY D.D.  FCY T.D.
----- End of picture text -----

5

Source: :Consolidated audited financial report / Management report

Liquidity

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

 Demand Deposit ratio

==> picture [695 x 324] intentionally omitted <==

----- Start of picture text -----

36.58%
 Gross loan-to-deposit ratio
28.83% 29.51%
75.72%
73.18%
74.24% 71.58%
72.62%
2018 2019 2020
 Liquidity coverage ratio
66.81%
142.42%
124.91%
2018 2019 2020 110.28%
 By YE balance  By average balance
----- End of picture text -----

2018

2019

2020

6

Source: :Consolidated audited financial report / FEIB website

Asset Quality

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

==> picture [710 x 266] intentionally omitted <==

----- Start of picture text -----

NPL ratio NPL coverage ratio Loan coverage ratio
0.51% 649%
574% 1.46%
621% 1.42%
574%
513% 1.38%
1.37%
286% 1.40%
0.28%
1.36%
0.24%
0.24%
0.22%
0.22%
Dec'18 Dec'19 Dec'20 Dec'18 Dec'19 Dec'20 Dec'18 Dec'19 Dec'20
----- End of picture text -----

 Industry  FEIB

7

Source: Consolidated audited financial reports / FSC report Industry: 35 Commercial Banks (excluding EX-IM Bk)

Profitability

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

==> picture [665 x 432] intentionally omitted <==

----- Start of picture text -----

 Revenue  PPOP
YoY YoY
(NT$Bn) (NT$Bn)
11.7
11.2 11.2 -4.3% -8.7%
0.3
0.5 0.4
1.9 2.5 1.3 (47.6%) 4.6 4.8
4.4
3.5
3.1 3.5
10.6%
5.7 5.5 6.0
2018 2019 2020
2018 2019 2020
 NII  Fee  Trading  Other
 Provision Cost  IBT YoY
1.9 YoY
(NT$Bn) (NT$Bn)
-32.2%
104% 4.3
0.4 4.1
1.0 2.9
0.9
0.5 0.4 1.5
0.5 0.5
2018 2019 2020 2018 2019 2020
 Net Provision cost  Recovery
----- End of picture text -----

Source: :Consolidated audited financial report

8

Profitability

 NIM

==> picture [36 x 10] intentionally omitted <==

----- Start of picture text -----

1.09%
----- End of picture text -----

==> picture [131 x 31] intentionally omitted <==

----- Start of picture text -----

1.03%
1.01%
----- End of picture text -----

==> picture [236 x 10] intentionally omitted <==

----- Start of picture text -----

2018 2019 2020
----- End of picture text -----

==> picture [62 x 69] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

 Loan Yield* & Avg. Loan Balance

==> picture [343 x 165] intentionally omitted <==

----- Start of picture text -----

1.11% 1.09%
0.98%
(NT$Bn)
399
389
374
2018 2019 2020
----- End of picture text -----

• =Net loan revenue / Avg. loan balance

 ROA (after tax)

==> picture [266 x 41] intentionally omitted <==

----- Start of picture text -----

0.59% 0.57%
0.38%
----- End of picture text -----

 ROE (after tax)

==> picture [256 x 43] intentionally omitted <==

----- Start of picture text -----

8.05%
7.89%
5.25%
----- End of picture text -----

2019

2018

2019

2020

2018

2020

9

Source: :Consolidated audited financial report/ FEIB website

BIS

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

 CET1(unconsolidated)

 BIS (unconsolidated)

==> picture [694 x 236] intentionally omitted <==

----- Start of picture text -----

14.10%
13.60%
13.33%
11.03%
10.53%
10.51%
11.07% 10.99% 11.49%
2018 2019 2020 2018 2019 2020
----- End of picture text -----

==> picture [121 x 11] intentionally omitted <==

----- Start of picture text -----

 Tier1  Tier 2
----- End of picture text -----

10

Source: :FEIB website

Dividends

 EPS & Dividend

==> picture [186 x 43] intentionally omitted <==

 Cash dividend yield *

==> picture [62 x 69] intentionally omitted <==

(NT$/Share)

(EPS) $1.05 $1.08

==> picture [339 x 190] intentionally omitted <==

----- Start of picture text -----

$0.73
0.28
0.27
0.19
0.45 0.47
0.33
2018 2019 2020
----- End of picture text -----

==> picture [340 x 199] intentionally omitted <==

----- Start of picture text -----

4.47%
4.00%
3.00%
2018 2019 2020
----- End of picture text -----

 Cash  Stock  Reserved Earning

• = Cash dividend / Avg. stock price of the year of earnings

11

Source: :Consolidated audited financial report/ Annual report Note: The 2020 dividend is yet to be approved by the shareholders' meeting

Contents

==> picture [285 x 95] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

==> picture [194 x 87] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

12

Steady growth

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

==> picture [669 x 391] intentionally omitted <==

----- Start of picture text -----

YoY
 Loan
 Assets
7%
(NT$Bn)
(NT$Bn)
YoY
6% 401 397 424
2019 2020 2021 est.
YoY

Deposit
722 2%
680
654
(NT$Bn)
583 594
538
2019 2020 2021 est.
2019 2020 2021 est.
----- End of picture text -----

13

*2021 est.:Per 2020 business report

Retail banking integration

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

==> picture [433 x 364] intentionally omitted <==

----- Start of picture text -----

Big Data
Cross-selling model
Digital branch
Deposit
Integrated branch
----- End of picture text -----

==> picture [172 x 150] intentionally omitted <==

----- Start of picture text -----

Deposit
Wealth
management
Credit
cards
----- End of picture text -----

==> picture [172 x 57] intentionally omitted <==

----- Start of picture text -----

Consumer loan
Mortgage
----- End of picture text -----

14

Risk management

==> picture [46 x 46] intentionally omitted <==

Strengthen credit risk management

==> picture [46 x 47] intentionally omitted <==

• Review defaulted cases, lessonlearned early warning signals

• Strengthen TM and risk assessment for loans in China and overseas market

• Enhance risk control factors for local real-estate lending

• Improve personal loan and credit card scoring models and risk identification

==> picture [62 x 69] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

Refocus local market

 Offshore assets/total assets

==> picture [210 x 117] intentionally omitted <==

----- Start of picture text -----

17%
14%
13%
2019 2020 2021 est.
----- End of picture text -----

 SME+MM/total loans

==> picture [232 x 139] intentionally omitted <==

----- Start of picture text -----

11%
9%
7%
2019 2020 2021 est.
----- End of picture text -----

15

Digital banking

==> picture [41 x 41] intentionally omitted <==

Digital channel

• Off - counter rate ： 93.7% (YE’2020)

==> picture [237 x 99] intentionally omitted <==

----- Start of picture text -----

%
97 96
83 73
57
----- End of picture text -----

Transfer Withdraw Fund Exchange Deposit

• Acquisition rate ： 40.6% (YE’2020)

==> picture [41 x 41] intentionally omitted <==

==> picture [40 x 40] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

Open banking

• No.1 - Open Banking Phase 2

TSP

==> picture [188 x 120] intentionally omitted <==

Digital tx execution

• Robotic Process Automation(RPA)

==> picture [240 x 106] intentionally omitted <==

----- Start of picture text -----

40.6.%
21.7
4%
Deposit Credit Card consumer
loans
----- End of picture text -----

• eKYC, e-ID checking

• Digital marketing, digital scoring

• 24hr Online trading (Local & overseas mkt.), FX trading

16

Financial market

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

New business

 Proprietary trading of gold futures

 FCY bond dealing

• New structured products, pricing and hedging

Trading & Investment

• Trading income outgrows TMU sales revenue

• Investment portfolio YoY +16~17%

• Bond investment outgrows equity investment

17

ESG strategies

Environment

• Green finance

• Equator principle

• TCFD disclosure

==> picture [62 x 69] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

Corporate Governance

 New "Corporate Governance and Sustainability Committee“

• Board diversification

• Board structure

• Disciplines & ranking

Social

• Society engagement activities

• Buying Power (MOEA)

• Human resource /labor relations

18

Contents

==> picture [285 x 95] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

==> picture [185 x 38] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

19

Key Financials

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

(NT$ m, except percentages and per share data)	(NT$ m, except percentages and per share data)	(NT$ m, except percentages and per share data)	(NT$ m, except percentages and per share data)	(NT$ m, except percentages and per share data)
(Consolidated)	As of or for 12 months ended December 31
	2018	2019	2020	YoY
Key balance sheet items
Gross loans	384,923	390,200	388,857	-0.3%
Total assets	627,351	654,888	680,047	3.8%
Deposits and remittances	508,408	537,396	582,153	8.3%
Total shareholders’ equity	44,745	47,284	48,744	3.1%
BVPS	13.69	14.09	14.14	0.4%
Key income statement items
Net interest income	5,681	5,458	6,037	10.6%
Net fee income	3,131	3,471	3,514	1.2%
Earnings before Provision	4,583	4,769	4,353	-8.7%
Net income	3,524	3,633	2,519	-30.7%
EPS	1.02	1.05	0.73	-30.5%
Key ratios
NIM (unconsolidated)	1.09%	1.01%	1.03%	+2bp
Cost to income ratio	59.14%	59.32%	61.19%	+1.87 Pctp
**ROE **	8.05%	7.89%	5.25%	-2.64 Pctp
ROA	0.59%	0.57%	0.38%	-19 bp
LDR(excluded remittances)	75.72%	72.62%	66.81%	-5.81 Pctp
NPL ratio	0.24%	0.28%	0.51%	+23 bp
Coverage ratio	574%	513%	286%	-227 Pctp
CET 1ratio (unconsolidated)	10.51%	10.53%	11.03%	+50 bp
Tier 1 ratio (unconsolidated)	11.07%	10.99%	11.49%	+50 bp
Total CAR (unconsolidated)	13.33%	13.60%	14.10%	+50 bp

20

==> picture [104 x 57] intentionally omitted <==

==> picture [186 x 43] intentionally omitted <==

Thank you

==> picture [62 x 69] intentionally omitted <==

21

Disclaimer

==> picture [186 x 43] intentionally omitted <==

==> picture [62 x 69] intentionally omitted <==

This presentation has been prepared by Far Eastern International Bank (the “Company”). This presentation and the materials provided herewith do not constitute an offer to sell or issue or the solicitation of an offer to buy or acquire securities of the Company in any jurisdiction or an inducement to enter into investment activity, nor may it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever. Any decision to purchase securities in a proposed offering should be made solely on the basis of the information contained in the offering circular published in relation to such proposed offering, if any.

The information contained in this presentation has not been independently verified. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. The information contained in this document should be considered in the context of the circumstances prevailing at the time and has not been, and will not be, updated to reflect material developments which may occur after the date of the presentation. All of the information contained in this presentation is based on, or derived from publicly available information, including, among other things, the Company’s consolidated financial statements published, and the presentation does not contain any material non-public information. None of the Company nor any of its affiliates advisors or representatives will be liable (in negligence or otherwise) affiliates, for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation.

22