T.C.C.B. — Interim / Quarterly Report 2019

Aug 26, 2019

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2019.8.27

Disclaimer

• This presentation is provided by Taichung Commercial Bank(TCB).The information contained within is not reviewed or reviewed by any accountant or any independent third party. Users should read this material in conjunction with all other public financial and operational information filed to the competent authorities by TCB. While we endeavor to provide accurate, complete and consistent information herein, TCB makes no guarantee or warranties as to the accuracy or correctness of all the material contained. After this presentation is released to the public, we undertake no obligation to update any relevant data to reflect any change hereafter.

• Users should also notice that this presentation may contain forward-looking statements. Statements that are not historical facts, including statements relating to the implementation of strategic initiatives, future business development and economic performance are forward-looking statements. By their nature, forward-looking statements involve uncertainties, risks, assumptions and other factors that could cause actual developments and results to differ materially from our statement in this presentation. These factors include, but not limited to, regulatory developments, competitive conditions, technological developments, general economic conditions and management changes.

• The information, statements or opinions in this presentation do not constitute a public offer under any applicable legislation or an offer to sell or solicitation of an offer to buy any securities or financial instruments or any advice or recommendation respect to such securities or other financial instruments. TCB and its affiliates representatives, no matter for their negligence or any other reasons, should not be liable for any loss or damages arising from the use of or interpretation by others of information contained within this presentation or any matter related to this document.

• The operating results still need to be audited by accountants.

A enda g

■ Financial Highlights

■ Financial Review

■ Financial Information ■ Appendix

3

2019 Half Year Financial Hi hli ht g g

Profitability

• Net Profit after tax 2.1billions, 10.26% growth over the same period last year.

• EPS 0.57, 5.56% growth over the same period last year.

Asset quality

• NPL rate 0.37%、Provision for bad debt coverage rate 403.68%.

Capital adequacy

• Consolidated：Capital Ratio 13.63%、Tier I Capital Ratio 12.48%。

• Individual：Capital Ratio 12.98%、Tier I Capital Ratio 12.37%。

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A enda g

■ Financial Highlights

■ Financial Review

■ Financial Information

■ Appendix

5

Profitabilit y

Net Profit

( NT$ Million )

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2,106
+10.26%
1,910
1H18 1H19
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4,008
+10.32%
+3.36% 3,633
3,515
2016 2017 2018
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EPS
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( NT$ )
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0.57
+5.56%
0.54
1H18 1H19
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1.18
+7.27%
+0.92% 1.10
1.09
2016 2017 2018
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Profitabilit y

ROA

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0.62%
0.58%
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1H18(Note) 1H19(Note)
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0.60%
0.59%
0.57%
2016 2017 2018
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ROE

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8.72% 8.68%
1H18(Note) 1H19(Note)
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8.64% 8.57% 8.79%
2016 2017 2018
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Note： ROE and ROA are annualized

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Chan e in Net Profit (NT$ Million) g

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1H18 1H19
1H18 1H19
YoY 7.19% YoY 0.54% YoY 26.50% YoY 13.69%
5,549
5,177
2,450
2,155
2,788 2,803
234 296
Operating Operating Provision Profit before tax
Revenue Expenses
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De osit Breakdown (NT$ Hundred Million) p

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Total Deposit
YoY -1.10%
5,823
5,824 5,892 QoQ -1.08%
5,733 5,760
529
523 535 Foreign
532 566
currency
deposits
YoY 8.22%
QoQ 5.79%
Checking &
Time &
demand
Time & saving
2,931 2,842 2,900 2,805 2,700 saving deposits(l deposits
(local
deposits ocal
currency)
(local currency)
43.30%
currency) 46.88%
YoY -7.88%
QoQ -3.74%
Checking &
demand Foreign
2,370 2,359 2,463 2,483 2,494 deposits currency
(local deposits
currency) 9.82%
YoY 5.23%
QoQ 0.44%
Deposit Structure 2Q19
2Q18 3Q18 4Q18 1Q19 2Q19
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Loan Structure (NT$ Hundred Million)

Corporate Banking Consumer Banking

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2,293 2,363 2,240
2,219 2,171
2,067
52.59% 47.41% 51.57% 48.43% 50.78% 49.22%
2017 2018 1H19
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	2017	2018	1H19	HoH
Corporate Banking	2,293	2,363	2,240	-5.21%
Consumer Banking	2,067	2,219	2,171	-2.16%
Total	4,360	4,582	4,411	-3.73%

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Consumer Banking-Consumption Loans (NT$ Hundred Million)

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Average Rate NPL Rate
4.56%
4.48% 4.49%
0.52% 0.52%
0.51%
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115
110 +4.55%
85
Local Bank
+1.26%
2017 2018 1H19
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Note：Customption loans are not contain residential mortgage loans、loan of cash card、credit card and debit card.

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Loan Structure b Currenc (NT$ Hundred Million) y y

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Foreign Currency Loan NTD Loan
4,199
3,992 4,017
91.56% 91.64% 91.07%
368 383 394
8.44% 8.36% 8.93%
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368 383 394 8.93% 8.36% 8.44%	368 383 394 8.93% 8.36% 8.44%	368 383 394 8.93% 8.36% 8.44%	368 383 394 8.93% 8.36% 8.44%	368 383 394 8.93% 8.36% 8.44%
2017 2018 1H19
	2017	2018	1H19	HoH
NTD Loan	3,992	4,199	4,017	-4.33%
Foreign Currency Loan	368	383	394	2.87%
Total	4,360	4,582	4,411	-3.73%

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Loan Breakdown (NT$ Hundred Million)

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Total Loan
4,582 4,511 4,411 YoY -1.83%
4,535
4,493 QoQ -2.22%
229 Mortgage
244 209 Consumption
276 204 Corporate
12.72% Loan
YoY -26.09%
2.83%
QoQ -2.39%
OBU
SME 7.12%
1,815 1,831 1,842 1,782 1,722 QoQ -3.37% YoY -5.12% Other
Personal
OBU
YoY 18.49% Loan
QoQ 0.96%
33.67%
277 293 311 314
265 SME
Mortgage 39.04%
555 565 570 567 561 YoY 1.08%
QoQ -1.06%
108 114 120 122 125
Consumption Loan
Corporate
YoY 15.74%
4.62%
QoQ 2.46%
1,474 1,504 1,528 1,520 1,485
Other Personal Loan
YoY 0.81%
QoQ -2.24% Loan Structure 2Q19
2Q18 3Q18 4Q18 1Q19 2Q19
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S ndicated Loan of Bankin (NT$ Hundred Million) y g

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Syndicated Loan to Total loan Syndicated Loan NPL Balance of Syndicated Loan
7.96%
7.62% 7.57%
7.46%
7.30%
0.45%
0.00% 0.00% 0.00% 0.00%
359
349
335 334
331
2Q18 3Q18 2018 1Q19 2Q19
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Loan Breakdown (NT$ Hundred Million)

	712 705 672 3,648 3,877 3,739 2017 2018 1H19 Non-secured Secured 15.23% 84.77% 84.61% 83.67% 15.39% 16.33%	712 705 672 3,648 3,877 3,739 2017 2018 1H19 Non-secured Secured 15.23% 84.77% 84.61% 83.67% 15.39% 16.33%	712 705 672 3,648 3,877 3,739 2017 2018 1H19 Non-secured Secured 15.23% 84.77% 84.61% 83.67% 15.39% 16.33%	712 705 672 3,648 3,877 3,739 2017 2018 1H19 Non-secured Secured 15.23% 84.77% 84.61% 83.67% 15.39% 16.33%	712 705 672 3,648 3,877 3,739 2017 2018 1H19 Non-secured Secured 15.23% 84.77% 84.61% 83.67% 15.39% 16.33%
		2017	2018	1H19	HoH
	Non-secured	712	705	672	-4.68%
	Secured	3,648	3,877	3,739	-3.56%
	Secured by property	3,321	3,536	3,428	-3.05%
	Secured by Letter of Guarantee	170	164	158	-3.66%
	Others	157	177	153	-13.56%
	Total	4,360	4,582	4,411	-3.73%

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LDR

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Overall LDR NTD LDR FCY LDR
79.89%
78.48%
77.59% 77.73% 77.79%
77.34%
76.96%
79.10%
77.92%
77.48%
77.04% 77.15%
76.57%
75.94%
74.40%
72.34%
71.47% 71.28% 71.38%
69.58%
66.00%
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4Q17
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1Q18 2Q18
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3Q18 4Q18
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1Q19 2Q19

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S reads p

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Overall Spreads

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NTD Spreads FCY Spreads
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2.45% 2.43% 2.44%
2.38%
2.34%
2.11%
2.07%
1.78%
1.77%
1.74% 1.74%
1.73% 1.73%
1.72%
1.70%
1.70% 1.70%
1.69% 1.69%
1.68%
1.67%
4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
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17

TCB Bank’s NIM (NT$ Hundred million)

NIM and Interest earning assets

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NIM
1.28%
1.24%
1.23% 1.23%
1.22%
1.21%
1.19%
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Average of Interest earning assets

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6,436 6,430
6,298 6,322
6,244
6,174
6,016
4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
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O eratin Ex enses to Net Income (NT$ million) p g p

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Net Income Operating Expenses Cost-Benefit Ratio

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57.50%
53.66% 54.08%
50.57% 49.54%
46.86%
43.94%
2,733 2,717 2,756 2,743 2,809 2,740
2,459
1,479 1,519
1,414 1,374 1,359
1,201 1,284
4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
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Asset ualit (NT$ Million) q y

NPLs/Total Loans &NPLs

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NPLs/Total Loans NPLs
-0.21%
0.58%
0.45%
0.42% 0.42%
0.37% 0.37%
2,501
2,054
1,845
1,842
1,655 1,645
4Q16 2Q17 4Q17 2Q18 4Q18 2Q19
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Asset ualit (NT$ Million) q y

Reserve/NPLs & Loan Reserve

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Reserve/NPLs Loan Reserve
+154.74%
403.68%
378.28%
344.14% 343.87%
317.95%
248.94%
6,643
6,532
6,338 6,345
6,260
6,227
4Q16 2Q17 4Q17 2Q18 4Q18 2Q19
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Fee Income Breakdown (NT$ Million)

Fee Income YoY -7.81% 815 YoY -7.73% 789 797 807 QoQ -6.82% 752 1,691 84 83 1,559 92 97 86 Others 171 Others YoY 2.38% 151 QoQ 3.61% 169 191 128 169 142 324 Loans YoY -25.65% 293 QoQ -5.96% Loans 184 196 207 183 429 221 Trust 405 YoY 6.76% QoQ 20.11% Trust Insurance & 389 333 373 348 Securities 767 303 YoY -9.01% 692 QoQ -22.11% Insurance & Securities 2Q18 3Q18 4Q18 1Q19 2Q19 1H18 1H19

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Wealth Mana ement Fee Income g

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558 554 Total YoY -9.15%
YoY -2.50%
514
521 508 QoQ -8.30%
1,169
1,062
117
146
135 113 Mutual Fund
143
YoY 5.93%
308
QoQ 22.22%
260 Mutual
Fund
Insurance &
389 Securities
333 373 348 YoY -9.01% Insurance
303
QoQ -22.11% 767
692 &
Securities
Others
YoY 16.98 % Others
QoQ 29.17%
53 38 54 48 62 94 110
1H18 1H19
2Q18 3Q18 4Q18 1Q19 2Q19
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Profit of Subsidiar to TCB (NT$ Million) y

Net Profit after tax	1H18	1H19	HoH
TCB	1,784	1,831	2.63%
Subsidiary	126	275	118.25%
Total	1,910	2,106	10.26%
TCB 93.41% Subsidiary of TCB 6.59% TCB 86.92% Subsidiary of TCB 13.08%

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1H18 Profit Breakdown
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1H19 Profit Breakdown
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Capital Adequacy

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Consolidated
BIS Tier I Capital Ratio BIS
+2.67%
13.63%
13.01%
12.68%
12.41%
10.96% 11.13%
12.48%
11.79%
11.15% 10.99%
9.35% 9.46%
2016 1H17 2017 1H18 2018 1H19
Individual
BIS
BIS Tier I Capital Ratio
+2.73%
12.98%
12.35%
12.01%
11.75%
10.49%
10.25%
12.37%
11.65%
10.98% 10.82%
9.09% 9.27%
2016 1H17 2017 1H18 2018 1H19
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25

A enda g

■ Financial Highlights

■ Financial Review

■ Financial Information ■ Appendix

26

Balance Sheet (Individual)

	2016	2017	2018	1H19	HoH
Assets：
Cash and due from banks	99,539	44,066	46,740	45,894	-1.81%
Financial investment, net	77,450	158,984	163,891	171,735	4.79%
Loans, net	423,901	429,656	451,729	434,509	-3.81%
A/R, net	4,075	6,329	5,028	3,591	-28.58%
LT investments, net	4,498	4,735	5,225	5,237	0.23%
Land, premises and equipment, net	9,372	9,296	9,368	9,371	0.03%
Others	3,714	3,424	2,178	3,010	38.20%
Total assets	622,549	656,490	684,159	673,347	-1.58%
Liabilities：
Deposits	541,243	567,256	589,243	576,043	-2.24%
Other Liabilities	39,924	45,832	47,092	47,991	1.91%
Total Liabilities	581,167	613,088	636,335	624,034	-1.93%
Total stockholders’ equity	41,382	43,402	47,824	49,313	3.11%
Total liabilities and stockholders’ equity	622,549	656,490	684,159	673,347	-1.58%

27

P&L (Individual)

	2016	2017	2018	1H18	1H19	HoH
Net interest income	7,499	7,823	7,991	3,898	3,964	1.69%
Net fee income	1,294	1,554	1,793	938	902	-3.84%
Others	985	971	891	341	683	100.29%
Total Operating Income	9,778	10,348	10,675	5,177	5,549	7.19%
Operating expenses	(5,005)	(5,131)	(5,626)	(2,788)	(2,803)	0.54%
Pre-provision Profit	4,773	5,217	5,049	2,389	2,746	14.94%
Credit Loss Provisions, net	(690)	(947)	(411)	(234)	(296)	26.50%
Profit Before Income Tax	4,083	4,270	4,638	2,155	2,450	13.69%
Tax Fee	(568)	(637)	(630)	(245)	(344)	40.41%
Net Profit After Income Tax	3,515	3,633	4,008	1,910	2,106	10.26%
Other Profits	(487)	168	34	110	371	237.27%
Current period other comprehensive income	3,028	3,801	4,042	2,020	2,477	22.62%

28

Balance Sheet (Consolidated)

	2016	2017	2018	1H19	HoH
Assets：
Cash and due from banks	100,323	45,123	47,644	46,960	-1.44%
Financial investment, net	77,742	159,651	165,027	172,719	4.66%
Loans, net	425,166	430,858	452,595	435,604	-3.75%
A/R, net	9,802	13,658	12,781	11,939	-6.59%
LT investments, net	131	128	153	154	0.65%
Land, premises and equipment, net	9,437	9,388	9,447	9,439	-0.08%
Others	4,502	4,218	3,185	4,234	32.94 %
Total assets	627,103	663,024	690,832	681,049	-1.42%
Liabilities：
Deposits	539,809	566,095	587,968	574,767	-2.25%
Other Liabilities	45,912	53,527	55,040	56,969	3.50%
Total Liabilities	585,721	619,622	643,008	631,736	-1.75%
Total stockholders’ equity	41,382	43,402	47,824	49,313	3.11%
Total liabilities and stockholders’ equity	627,103	663,024	690,832	681,049	-1.42%

29

P&L (Consolidated)

	2016	2017	2018	1H18	1H19	HoH
Net interest income	7,787	8,186	8,434	4,100	4,171	1.73%
Net fee income	2,272	2,449	2,846	1,347	1,430	6.16%
Others	734	760	409	213	468	119.72%
Total Operating Income	10,793	11,395	11,689	5,660	6,069	7.23%
Operating expenses	(5,848)	(5,915)	(6,457)	(3,208)	(3,191)	-0.53%
Pre-provision Profit	4,945	5,480	5,232	2,452	2,878	17.37%
Credit Loss Provisions, net	(801)	(1,125)	(472)	(267)	(365)	36.70%
Profit Before Income Tax	4,144	4,355	4,760	2,185	2,513	15.01%
Tax Fee	(629)	(722)	(752)	(275)	(407)	48.00%
Net Profit After Income Tax	3,515	3,633	4,008	1,910	2,106	10.26%
Other Profits	(487)	168	34	110	371	237.27%
Current period other comprehensive income	3,028	3,801	4,042	2,020	2,477	22.62%

30

A enda g

■ Financial Highlights

■ Financial Review

■ Financial Information

■ Appendix

31

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Credit Rating
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Fitch Ratings Long-term Short-term Outlook Domestic Rating A- (twn) F1 (twn) Stable International Rating ~~2018~~ ~~年上半年營運亮點~~ BB+ B Stable Viability Rating bb+ Support Rating 4

2

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Cultivating deeply in Taiwan
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83

Branches

Opening of the Yanchao Branch on April 2019.

Greater Taipei：12 Branches

(Taipei and New Taipei, Excluding OBU Branch)

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Taoyuan/Hsinchu/Miaoli：11 Branches

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Central Taiwan：49 Branches

、 (Taichung Changhua and Nantou)

Southern Taiwan：10 Branches 、 、 (Yunlin Chiayi Tainan and Kaohsiung)

Kuala Lumpur

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Overseas Branches：Malaysia

Labuan

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Achievements
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Received Overseas Credit Guarantee Fund (Taiwan)’s “2018 Financing Amount Growth for New Southern Policy Countries Excellent Award”. Received Wealth Magazine’s 2019 Wealth Management Award- “Best Financial Technology” and “Best Public Welfare Promotion”. 2018 年上半年營運亮點 Received Excellence magazine 2019 Outstanding Bank Evaluation Poll - the “Best Corporate Social Responsibility Award” and “Best Customer Recommendation Award” .

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Received double awards of “Internet Popularity Award” and “Most Creative Filming Award” in the 2019 3rd Taipei Golden Eagle Micro-Movie Festival.

2

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Our prospects
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of 2019
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Implement financial governance, strengthen corporate compliance.

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Grow our business prudently, optimize assets management. Deepen customer relationship management, expand our customer 2018 年上半年營運亮點 base .

Expand the international financial market, Strengthen our competitive advantage on foreign exchange market. Refine the financial technology, optimize the customer experiences.

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Thanks for your listening!

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