4Q10AM Prez+Appx ENG AefaIHFmfrbH p969BcdFNeUJ

8/6/2019 4Q10AM Prez+Appx ENG AefaIHFmfrbH p969BcdFNeUJ

1/38

Chinatrust FHC

Analyst MeetingFinancial Review of 4Q10

February 23, 2011

Investor Relations


2/38

Chinatrust 1

DISCLAIMER

THE FINANCIAL INFORMATION IN THESE MATERIALS AS OF AND FOR

THE TWELVE MONTHS ENDED DECEMBER 31, 2010 ARE PRELIMINARY.

CHINATRUST FHC EXPECTS TO FILE ITS UNAUDITED INTERIMFINANCIAL STATEMENTS, WHICH ARE SUBJECT TO REVIEW BY ITS

AUDITORS, WITH THE ROC SECURITIES AND FUTURES BUREAU ON OR

ABOUT APRIL 30, 2011.

This presentation contains forward-looking statements and information that is, statementsrelated to future, not past, events. These forward-looking statements are based on the current

expectations and certain assumptions made by Chinatrust and are therefore subject to certain

risks and uncertainties. By nature, these risks and uncertainties could cause actual results,

performance or achievements to differ materially from those indicated. Chinatrust disclaims

any intention or obligation to update or revise any forward-looking statements, whether as a

result of new information, future events or otherwise.

These materials are not an offer for sale of securities in the United States. Securities may not

be sold in the United States absent registration or an exemption from registration under the

U.S. Securities Act of 1933, as amended.


3/38

Chinatrust 2

20102010 && 44Q10 PerformanceQ10 Performance

20112011 OutlookOutlook


4/38

Chinatrust 3

2010 & 4Q10 Performance Highlight

Earningsmomentum is

returning

Business momentum on NII regained in 2010. Driven by strong loangrowth and mild NIM expansion, NII grew 3.2% QoQ & 10.4% YoY.

Fee income grew 5.2% QoQ & 12.7% YoY. In particular, attributing to

heated-up investment needs, major growth driver - wealth managementfees - showed superior performance, grew 17.9% QoQ & 28.3% YoY.

Capitalremained

strong

Capital position remained strong with CFHCs CAR at 116.76%. Onthe bank level, CAR was 14.62% & Tier 1 ratio was 11.55%.

Asset qualitystrengthened

Asset quality remained benign, NPL ratio stood low at 0.58%,

coverage ratio boosted up to 220% as of year-end.

Attributing to sound asset quality and good recoveries, provisioncharges throughout 2010 kept at low level, reduced 85% YoY. Yet QoQprovision level has increased by NT$ 1.1 billion to partially prepare forArticle 34 implementation.


5/38

Chinatrust 4

CFHCs net profit breakdown

CFHCs net profit breakdownNT$ mm

13,1811,079 53 (264)85 14,134

2,431

CTCB CTIB CTS CTAMC &CTVC &

TW Lottery

CTFHC

CFHC 4Q10 CFHC 3Q10

2 CFHC 2010 CFHC 2009

3,236292 (12)

(24)(376)

3,1173,502

1

1

QoQ -11.0%

YoY +481.4%

CFHCs numbers are presented on a consolidated basis.

1. 4Q10 & 2010 numbers are preliminary and have yet to be reviewed by our auditors.2. CTFHC (on a non-consolidated basis) is an adjustment item for compiling consolidated statement.


6/38

Chinatrust 5

CFHCs profitability ratios

1.32

0.14

1.511.49

-1.46

2006 2007 2008 2009 2010

1.32

0.14

1.461.34

-1.31

Retroactively adjusted EPS & reported EPS, after taxNT$

Reported EPSRetroactively adjusted EPS1

2

10.50%

1.21%

12.43%12.14%

-11.80%

2006 2007 2008 2009 2010

CFHCs numbers are presented on a consolidated basis.1. EPS in the chart are retroactively adjusted for stock dividend payout from 2006 to 20092. 2010 numbers are preliminary and have yet to be reviewed by our auditors.

-0.60%

0.79% 0.86%

0.14%

0.79%

2006 2007 2008 2009 20102

ROAE, after tax

%

ROAA, after tax

2

%


7/38

Chinatrust 6

CFHCs revenue breakdown

(378)

(1,494)

1,307 1,211

(547)

16

425702

5,876

6,262

(37)

5,887

6,403

589

6,055 6,115

623525

6,268 6,358

249

628

(363)

6,6886,467

Net Interest

Income

Fee Income LT Investment

& Others

Trading

Gains

Derivatives &

FX

4Q091Q102Q103Q104Q10

-11% -5%6% 5%8% 5%

49% 49%

48% 47%

2009 2010

NII

Fee

Trading

Derivatives &FX

LT Investment & others

CFHCs Revenue breakdownNT$ mm, %

1

1

4Q10: 13,669

Revenue (NT$ mm) %

2009: 46,481 2010: 52,555 +13.1%

+3.3%3Q10: 13,227

QoQ +3.2%YoY +10.4%

QoQ +5.2%YoY +12.7%

QoQ -60.0%YoY -8.7%

QoQ +19.5%YoY -35.9%

QoQ +33.7%YoY -47.2%

2

CFHCs numbers are presented on a consolidated basis.1. 4Q10 & 2010 numbers are preliminary and have yet to be reviewed by our auditors.2. 2Q10 trading gains incl. cash dividend totaled NT$1,235mm received from investment in Mega FHC.


8/38

Chinatrust 7

CTCBs lending portfolio breakdown

57% 58%

33% 31%

7% 8%2% 2%1% 1%

2009 2010

Small business + Car loan

Credit Card Revolving

Unsecured Loan

Mortgages

Commercial Loans

Loan breakdown1 (incl. credit card revolving balance)NT$ bn, %

67

228 8

582

72

2110

75

21 12

79

20 14

304

529

558

301

68

22

305 308

577

315

591

Commercial

Loans

Mortgages Consumer

Loans

Credit Card

Revolving

Small Biz &

Car loan

4Q09

1Q10

2Q10

3Q10

4Q10

3

3

2

QoQ +2.4%YoY +11.8%

QoQ +2.2%YoY +3.6%

QoQ +18.7%YoY +75.0%

QoQ -1.1%YoY -7.8%

QoQ +5.5%YoY +17.9%

Dec10: 1,023

Total Lending Portfolio4 (NT$bn) %

Dec09: 942 Dec10: 1,023 +8.6%

+2.6%Sep10: 997

2

These numbers are presented on CTCB consolidated basis.

1. Loan breakdown is presented on performing loan basis, excluding non-accrual loans.2. Commercial loans include foreign currency loans of overseas branches and subsidiaries.3. 4Q10 & 2010 numbers are preliminary and have yet to be reviewed by our auditors.4. Total lending portfolio includes performing loans, non-accrual loans and credit card revolving balance.


9/38

Chinatrust 8

Loan growth comparison with industry

Domestic Commercial Loan, YoY % Consumer Loan, YoY%

-5%

0%

5%

10%

15%

20%

2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10

Industry CTCB

-10%

-5%

0%

5%

10%

15%

20%

2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10

Industry CTCB

Mortgage, YoY % Total Foreign Currency Loan (incl. o/s sub.), YoY%

-15%

-10%

-5%

0%

5%

10%

15%

2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10

CTCB

-2%

0%

2%

4%

6%

8%

2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10

Industry CTCB

Data source: CBC (Taiwan)Definition: Domestic Commercial Loan- Loans from all industries, excl. individuals.

Mortgage- House Purchasing LoanConsumer Loan- Employee Welfare Loan, Other Consumer Loan


10/38

Chinatrust 9

CTCBs LDR

Total deposit & lending outstanding%, NT$ bn

1,321 1,347 1,356 1,352 1,367

980 997 1,0611,033 1,032

Dec 09 Mar 10 Jun 10 Sep 10 Dec 10

Loans & Credit Card Receivables

Deposit

3

LDR1for Overall, NTD & foreign currency loans

%

62.00%60.94%

65.24%

67.55%

65.23%

81.88%

79.29%79.78%78.29%78.46%

77.59%76.36%

76.19%74.02%74.18%


NTD Foreign Currency Overall

3

2

-1.61%-0.31%

5.06%

6.87%5.62% 6.19%6.05%

8.26%

5.76% 3.51%

YoY%- Loan & Credit Card Receivables

YoY%- Deposit

These numbers are presented for CTCB on a consolidated basis.

1. Credit card account receivables are included in the calculation of CTCBs LDR.2. Loans include both performing and non-accrual loans.3. Dec. 10 numbers are preliminary and have yet to be reviewed by our auditors.


11/38

Chinatrust 10

CTCBs NIM and spreads

6,4306,2706,0675,9155,906

4Q09 1Q10 2Q10 3Q10 4Q10

1.51%1.49%

1.46%1.46%1.47%

1.55%

Quarterly NIM & NII%, NT mm

Net Interest Margin (NIM)

Overall, NTD, FX spread%

1.75% 1.80% 1.78% 1.79%1.89%

2.21%2.12%2.12%2.12%2.09%

3.21%3.20%3.32%

3.22%3.22%

1.37%1.36%1.36%

1.31%

4Q09 1Q10 2Q10 3Q10 4Q10

Overall spread NTD spread

FX spread Industry averageNet Interest Income (NII)

1

excluding early repaymentpenalty from US sub

1

These numbers are presented on CTCB consolidated basis.1. 4Q10 numbers are preliminary and have yet to be reviewed by our auditors.


12/38

Chinatrust 11

CFHCs fee breakdown

33%27%

35%39%

8% 8%

12% 13%

12% 12%

2009 2010

Lottery

Corporate Business

Retail Business

Wealth Mgmt

Credit Cards

857

2,938

765

2,378

1,949

667

544

724

1,810

2,340

500

815937

709

543

2,290

1,716

2,491

706

879

511

1,771

706

555

1,725

Credit Cards Wealth Mgmt Retail

Business

Corporate

Business

Lottery

4Q09

1Q10

2Q103Q10

4Q10

CFHCs fee income comparison and breakdownNT$ mm, %

1

4Q10: 6,688

Total Fees (NT$mm) %

2009: 22,677 2010: 25,563 +12.7%

+5.2%3Q10: 6,358

QoQ -2.6%YoY -4.9%

QoQ +17.9%YoY +28.3%

QoQ -12.9%YoY +17.6%

QoQ -0.1%YoY +12.3%

QoQ +8.5%YoY +10.1%

1

CFHCs numbers are presented on a consolidated basis.1. 4Q10 & 2010 numbers are preliminary and have yet to be reviewed by our auditors.


13/38

Chinatrust 12

CFHCs cost to income ratio

8,2377,481

13,28112,465

13,195 13,227

7,724

9,140 9,017

13,669

4Q09 1Q10 2Q10 3Q10 4Q10

46,481

52,555

33,36230,292

2009 2010

Non-Interest

Expense

Revenue

62.0% 60.0% 58.5%

66.0%69.1%

63.5%65.2%

CFHCs Cost-to-Income ratio1 and cost & income%, NT$ mm

2 2

CFHCs numbers are presented on a consolidated basis.1. Cost-to-Income ratio is derived by dividing Total Non-interest Expense by Pre-provision Operating Revenue.2. 4Q10 & 2010 numbers are preliminary and have yet to be reviewed by our auditors


14/38

Chinatrust 13

USs asset quality is back on track

0.39%

0.60% 0.55%

1.69%

11.71%

0.09%0.89%

6.21% 2.49% 2.40%

NPL ratio

Delinquent ratio

Coverage ratio

Asset quality1 for US subsidiary%, NT$ bn

37.5 33.1 30.0 28.3 25.1

5.00.6 0.1

0.2 0.1


NPL

Performing Loans

2

28.5

42.5

33.6 30.1

Changes of CTBUSAs impaired asset transferred to CCCUS$ mm, %

Sales & Paydown

US$ 25.6 mm

15.0%Chg inValuationReserve (MTM)

US$ -2.7 mm

-1.6%

LHFS & OREO

US$ 147.2 mm

86.5%

Sep. 2010 Balance

412.05%

1826.90%

901.24%

989.03%

25.3

57.67%

US$ 170.8 mm

Dec. 2010 Balance

US$ 147.2 mm

1. Delinquency refers to loans are 30-90days over due, NPLs refers to loans are over 90 days over due.2. Dec 10 numbers are preliminary and have yet to be reviewed by our auditors.


15/38

Chinatrust 14

CTCBs asset quality

7.9 7.0 6.5 5.8 5.7

5.0

0.10.20.10.6


NPL amt.- US sub.NPL amt.- CTCB excl. US sub.

7.05.3 4.9 5.3 4.4

2.6

0.60.70.00.3


Delinquent amt.- US sub.Delinquent amt.- CTCB excl. US sub.

Delinquency1 for loan portfolio%, NT$ bn

2

0.60%

0.51%

1.05%

0.50%0.62%

0.59%

0.80% 0.52%

0.56%0.45%

Delinquent ratio- CTCB

Delinquent ratio- CTCB excl. US sub.

6.0

9.6

5.65.0 5.0

0.77%0.58%

0.61%

0.68%

0.80%

1.40%

0.69%

0.90%

0.61% 0.58%

NPL ratio- CTCB

NPL ratio- CTCB excl. US sub.

NPL1 for loan portfolio%, NT$ bn

6.0

12.9

7.66.7

5.8

2


1. Delinquency refers to loans are 30-90days over due, NPLs refers to loans are over 90 days over due.2. Dec 10 numbers are preliminary and have yet to be reviewed by our auditors.


16/38

Chinatrust 15

CTCBs credit cost and coverage ratio

Provisioning ratios1 and quarterly provision costs%, NT$ mm

1.93%

0.11%

0.29%

0.45%

0.00% -0.05%0.39%

-0.04%

0.17%0.45%

Provision ratio- CTCB

Provision ratio- CTCBexcl. US sub.

10.9 10.2 10.3

2.92.1

1.4

10.0 11.4

2.3 2.0

4Q09 1Q10 2Q10 3Q10 4Q10

LLR- US sub.

LLR- CTCB excl. US sub.

NPL coverage ratio and loan loss reserves%, NT$ bn

2

909119

3,622

(4)

4841,223

(96)(97)(6) (65)(24)

278

(530) (141)

841

4Q09 1Q10 2Q10 3Q10 4Q10

Provision- US sub.

Provision- IDRP

Provision- Normal4,649

(110)

12.4 12.113.7


1. Provisioning ratio is calculated by dividing provision to lending balances, including loans and credit card revolving balance. This ratio is presentedon annualized basis.2. 4Q10 numbers are preliminary and have yet to be reviewed by our auditors.

2

106.93%

138.06%

165.44%

186.38%

220.14%201.63%

145.40%157.07%

201.44%181.20%

CR- CTCB

CR- CTCB excl. US sub.

12.5

268721

12.8

985


17/38

Chinatrust 16

2010 & 42010 & 4Q10 PerformanceQ10 Performance

20112011 OutlookOutlook


18/38

Chinatrust 17

2011 is growing on a sound businessfoundation

Stable economy with domestic investment & consumption picking upStable economy with domestic investment & consumption picking up

Sustainable business in our home market

A redefined and clear focus in our global business

Strengthened governance & risk systems with benign credit outlook

Strong capital and funding position


19/38

Chinatrust 18

Economic Update

2011 Taiwan GDP Forecast Consumer Confidence Level

0

10

20

30

40

50

60

70

80

90

Mar-0

5

Jun-05

Sep-05

Dec-05

Mar-0

6

Jun-06

Sep-06

Dec-06

Mar-07

Jun-07

Sep-07

Dec-07

Mar-0

8

Jun-08

Sep-08

Dec-08

Mar-0

9

Jun-09

Sep-09

Dec-09

Mar-1

0

Jun-10

Sep-10

Dec-10

0

1

2

3

4

5

6

7

8

9

10

Consumer Confidence

Unemployment Rate

2009-2010 Taiwan Import/Export trend

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Export Import Export orderUS$ mm

Academia Sinica 4.71%

Chung-Hua Inst. for Economic

Research4.55%

Polaris Research Inst. 4.62%

Taiwan Reserch Inst. 4.24%

Taiwan Inst. of Economic Research 5.71%

Directorale-General of Budget,

Accounting & Statistics4.51%

Rediscount Rate & Spread

0.0

0.5

1.0

1.5

2.02.5

3.0

3.5

4.0Spread for TW Domestic Banks (%)

Rediscount Rate

Data Source: Central Bank of TaiwanData Source: Dept. of Statistics, Ministry of Economic Affairs


20/38

Chinatrust 19

Volume and margin expansion at low creditcosts

-40%

-30%

-20%

-10%

0%

10%

20%

30%

1Q06

2Q06

3Q06

4Q06

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

3Q08

4Q08

1Q09

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

4Q10

Consumer Loans YoY%

Cre dit Card Rev. Bal. YoY%

Total Unse cured Loans YoY%

-15%

-5%

5%

15%

25%

1Q06

2Q06

3Q06

4Q06

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

3Q08

4Q08

1Q09

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

4Q10

NTD Corp YoY%

FCY Corp YoY%

Total Corp YoY%

Clear recovery from both onshore & offshorecorporate loans post global financial crisis

Persistent consumer loan growth since creditcard crisis

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

NIM

-2,000

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

1Q04

2Q04

3Q04

4Q04

1Q05

2Q05

3Q05

4Q05

1Q06

2Q06

3Q06

4Q06

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

3Q08

4Q08

1Q09

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

4Q10

Provision (NT$mm)

Positive NIM outlook in a rate rising cycle Credit cycle currently in the trough

Note: CTCBs numbers


21/38

Chinatrust 20

Persistent fee growth

2008 2009 2010

Lottery

CorporateOther retail

Wealth Mgmt

Credit Card

-6.3%

+6.4%

+11.7%+1.2%

-2.2%

-4.9%

+28.3%

+10.1%+17.6%

+12.3%+0.7%+12.7%

2007Avg.

2008Avg.

2009Avg.

1Q10 2Q10 3Q10 4Q10

Structured

products

Mutual

Funds

Insurance

premium

90.1

97.9

88.8

97.6

70.6

45.4

Sales vol., NT$ mm

Fee income YoY growth rate (%)

000000

00

000

2008 2009 2010

Lottery

Corporate

Other retail

Wealth Mgmt

Credit Card

27.5%

39.3%

8.3%

13.0%12.0%

35.0%

32.7%

7.6%

12.4%12.4%

Fee income mix (%)

114.6

Majority of fee items shown decent growth for2 yr-round better confirms growing trend

Confirmed card consumption growthbenefited credit card fees

Other fees to make up ongoing structuralchanges for credit card business

Investment needs heating up wealthmanagement sales

4.7%

11.9%

-3.1%

10.6%

-1.0%5.2%

10.6%

6.4%

-4.8%-1.3%

4Q09 1Q10 2Q10 3Q10 4Q10

MerchantAcquring

QoQ%

Spending

QoQ%

Note; CFHC & CTCBs numbers


22/38

Chinatrust 21

Key Profit Drivers

2010 2011

Earnings

Volume drive

Slow margin expansion Strong fee growth

Volume growth continued

Strong margin expansion Mild fee growth

Credit Costs

Low new NPL influx US NPL clearing up

IFRS #34 phase II preparation

Low new NPL influx continued US overhang removed

IFRS #34 impact mitigated

Expenses

Operating expenses:

Staff bonus increased for

rebounding sales volume

Marketing/Branding

Non-operating expenses:

Transfer of Treasury stocks

Pension scheme adjustment

Operating expenses:

Staff expenses for increased headcount &

sales bonus, pay rise

Marketing/Branding

Risk management strengthening

New biz expansion:

China, BCI & other overseas markets

SME


23/38

Chinatrust FHCAnalyst Meeting

Financial Review of 4Q10

Appendix

February 23, 2011

Investor Relations


24/38

23

DISCLAIMER

THE FINANCIAL INFORMATION IN THESE MATERIALS AS OF AND FOR

THE TWELVES MONTHS ENDED DECEMBER 31, 2010 ARE PRELIMINARY.

CHINATRUST FHC EXPECTS TO FILE ITS UNAUDITED INTERIM FINANCIALSTATEMENTS, WHICH ARE SUBJECT TO REVIEW BY ITS AUDITORS, WITH

THE ROC SECURITIES AND FUTURES BUREAU ON OR ABOUT APRIL 30,

2011.

This presentation contains forward-looking statements and information that is, statements

related to future, not past, events. These forward-looking statements are based on the currentexpectations and certain assumptions made by Chinatrust and are therefore subject to certain

risks and uncertainties. By nature, these risks and uncertainties could cause actual results,

performance or achievements to differ materially from those indicated. Chinatrust disclaims any

intention or obligation to update or revise any forward-looking statements, whether as a result of

new information, future events or otherwise.These materials are not an offer for sale of securities in the United States. Securities may not be

sold in the United States absent registration or an exemption from registration under the U.S.

Securities Act of 1933, as amended.

CFHC S R ti


25/38

24

CFHCs Summary Ratios

2007 2008 2009 4Q09 1Q10 2Q10 3Q10 4Q101 12M09 12M101

Per Share Data

EPS (after-tax) (NT$) 1.49 1.51 0.15 0.14 0.38 0.35 0.33 0.29 0.14 1.32

DPS (NT$) 1.00 0.50 1.28 - - - - - - -

BVPS (NT$) 12.42 12.06 12.79 12.79 13.23 12.67 12.77 13.14 12.79 13.14

Common shares outstanding(million share)

8,410 8,931 9,280 9,280 9,280 9,298 9,893 9,941 9,280 9,941

DuPont Analysis

ROAA (after-tax)(%, annualized YTD earnings)

0.79% 0.86% 0.14% 0.35% 0.85% 0.83% 0.78% 0.69% 0.14% 0.79%

ROAE (after-tax)(%, annualized YTD earnings)

12.14% 12.43% 1.21% 4.19% 11.54% 11.57% 10.60% 8.87% 1.21% 10.50%

Leverage & Solvency Ratios

Double Leverage Ratio (%) 99.4% 98.3% 98.9% 98.9% 99.0% 99.2% 99.3% 97.3% 98.9% 97.3%

Avg. Equity / Avg. Assets (%) 7.85% 8.30% 8.32% 8.58% 8.55% 8.39% 8.49% 8.83% 8.31% 8.68%

Avg. Loans / Avg. Assets (%) 51.45% 53.37% 53.15% 52.57% 52.40% 53.16% 54.13% 54.71% 53.13% 53.58%

CAR - FHC (%) 114.2% 128.3% 131.8% 131.8% 140.7% 116.4% 120.5% 116.8% 131.8% 116.8%

CAR - Bank (%) 11.13% 12.64% 14.56% 14.56% 15.86% 14.44% 14.85% 14.62% 14.56% 14.62%

Tier 1 Ratio - Bank (%) 8.12% 9.06% 10.95% 10.95% 12.06% 11.00% 11.59% 11.55% 10.95% 11.55%

Yearly Results YTD ResultsQuarterly results

1. 4Q10 and 12M10 numbers are preliminary and have yet to be reviewed by our auditors.

CFHC S R ti


26/38

25

CFHCs Summary Ratios

2007 2008 2009 4Q09 1Q10 2Q10 3Q10 4Q101 12M09 12M10

1

Growth Ratios

NII growth -14.07% -9.09% -24.88% 5.28% 0.18% 2.86% 3.51% 3.17% -24.88% 10.36%

Fee growth 32.96% -10.00% 0.67% 10.39% 2.66% -4.50% 3.98% 5.19% 0.67% 12.73%

Net profit growth -230.78% 10.25% -83.47% 169.22% 148.12% -0.10% -6.75% -11.01% -83.47% 481.39%

Loan growth - Bank 3.53% 5.08% -1.47% -0.58% 2.37% 3.46% 0.23% 2.66% -1.47% 8.98%

Deposit growth - Bank -4.05% 4.15% 6.96% 2.21% 1.98% 0.59% -0.29% 1.12% 6.96% 3.42%

Performance Ratios

Loan-to-Deposit Ratio - Bank 80.80% 80.58% 74.18% 74.18% 74.02% 76.19% 76.36% 77.59% 74.18% 77.59%

NIM - Bank 2.18% 1.98% 1.44% 1.47% 1.48% 1.47% 1.49% 1.51% 1.44% 1.48%NII / Operating income 55.5% 49.8% 48.1% 44.1% 47.2% 45.9% 47.4% 47.3% 48.1% 47.0%

Fee / Operating income 42.4% 37.7% 48.8% 46.8% 51.4% 46.3% 48.1% 48.9% 48.8% 48.6%

Cost-to-income ratio 53.4% 51.5% 65.2% 62.1% 60.0% 58.5% 69.1% 66.0% 65.2% 63.5%

Asset Quality Ratios (Bank)

NPLs / Total Loans 1.68% 1.68% 1.40% 1.40% 0.80% 0.68% 0.61% 0.58% 1.40% 0.58%

Reserve / Total Loans 1.38% 1.25% 1.49% 1.49% 1.33% 1.27% 1.24% 1.28% 1.49% 1.28%

Reserve / NPLs 81.86% 74.63% 106.93% 106.93% 165.44% 186.38% 201.63% 220.14% 106.93% 220.14%

Provision/Avg. Loans &

Revolv. Bal.1.14% 1.34% 1.30% 1.93% 0.11% 0.29% -0.04% 0.39% 1.30% 0.19%

Yearly Results YoY ResultsQuarterly results


B l Sh t f D b 31 20101

f


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26

Balance Sheet as of December 31, 20101

of

CFHC and its major subsidiaries

NT$ millionCTCB

(consolidated)

Chinatrust

Insurance

Brokers

Chinatrust

Securities

Chinatrust

Asset

Management

Chinatrust

Venture

Capital

Taiwan

Lottery

CFHC

(non-

consolidated)

Adjustment

Items

CFHC

(consolidated)

Assets:

Cash and due from banks 125,803 372 2,090 3,737 563 343 3,277 (9,478) 126,707

Securities, net 464,540 3,622 2,769 1,039 348 - 10,118 0 482,436

Loans, net 989,417 - - - - - - - 989,417

A/R, net 124,402 319 2,151 118 8 130 1,533 (441) 128,219

LT investments, net 2,132 - - (0) - - 146,747 (146,681) 2,197

Land, premises and

equipments, net33,045 3 65 0 0 125 7 - 33,246

Others 60,984 18 1,654 147 1,012 106 429 (26) 64,325

Total assets 1,800,323 4,334 8,730 5,040 1,932 704 162,110 (156,626) 1,826,546

Liabilities:

Deposits 1,367,817 - - - - - 0 (9,478) 1,358,339

Other liabilities 302,897 579 2,781 35 4 146 465 (441) 306,466

Total liabilities 1,670,714 579 2,781 35 4 146 465 (9,919) 1,664,805

Minority interests 77 - - - - - - 19 96

Total stockholders' equity 129,532 3,754 5,949 5,006 1,928 557 161,645 (146,726) 161,645

Total liabilities and

stockholders' equity1,800,323 4,334 8,730 5,040 1,932 704 162,110 (156,626) 1,826,546

1. These numbers are preliminary and have yet to be reviewed by our auditors.

P&L of CFHC and its subsidiaries for the 12


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27

P&L of CFHC and its subsidiaries for the 12

months ended December 31, 20101

NT$ millionCTCB

(consolidated)

Chinatrust

Insurance

Brokers

Chinatrust

Securities

Chinatrust

Asset

Management

Chinatrust

Venture

Capital

Taiwan

Lottery

CFHC

(non-

consolidated)

Adjustment

Items

CFHC

(consolidated)

Operating income

Net interest income 24,682 10 112 5 3 1 (136) - 24,677

Fee income 23,852 1,253 473 - - 739 (2) (752) 25,563

LT investment income 101 - - - - - 14,403 (14,402) 102

Net trading income/(loss) 1,826 91 91 2 5 - 408 - 2,424

Derivatives & FX 2,683 - 39 (1) (33) - (15) - 2,673

Others (2,887) 1 (85) 117 (13) 20 25 (61) (2,883)

Total operating income 50,256 1,355 631 123 (38) 760 14,683 (15,215) 52,555

Operating costs (30,948) (87) (511) (7) (8) (713) (672) 817 (32,129)

Business tax (1,183) - (46) (3) - - (1) - (1,233)

Total operating costs (32,130) (87) (557) (10) (8) (713) (673) 817 (33,362)

Pre-provision Profit 18,126 1,268 73 113 (47) 47 14,011 (14,398) 19,193

Credit Loss Provisions, net (1,863) - - - - - - - (1,863)

Profit Before Income Tax 16,262 1,268 73 113 (47) 47 14,011 (14,398) 17,330

Net Profit After Income Tax 13,181 1,079 53 88 (42) 39 14,134 (14,398) 14,134

1. These numbers are preliminary and have yet to be reviewed by our auditors.

CFHCs Balance Sheet (consolidated)


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28

CFHCs Balance Sheet (consolidated)

NT$ million 2007 2008 2009 Dec 09 Mar 10 Jun 10 Sep 10 Dec 101 QoQ (%) YoY (%)

Assets:

Cash and due from banks 166,499 139,552 137,028 137,028 117,757 132,462 144,173 126,707 -12.1% -7.5%

Securities, net 396,775 376,842 497,895 497,895 530,541 491,739 454,864 482,436 6.1% -3.1%

Loans, net 875,970 921,675 905,880 905,880 928,924 961,612 964,205 989,417 2.6% 9.2%

A/R, net 140,332 115,704 113,430 113,430 105,985 118,513 116,211 128,219 10.3% 13.0%

LT investments, net 1,962 2,229 2,265 2,265 2,253 2,219 2,250 2,197 -2.3% -3.0%

Land, premises and

equipments, net34,105 33,494 34,142 34,142 34,012 33,841 33,600 33,246 -1.1% -2.6%

Others 72,111 136,010 69,944 69,944 71,390 72,794 74,503 64,325 -13.7% -8.0%

Total assets 1,687,754 1,725,505 1,760,586 1,760,586 1,790,862 1,813,179 1,789,806 1,826,546 2.1% 3.7%

Liabilities:

Deposits 1,180,402 1,226,171 1,307,717 1,307,717 1,326,094 1,335,787 1,343,957 1,358,339 1.1% 3.9%

Other liabilities 364,195 359,068 303,054 303,054 310,624 328,960 288,246 306,466 6.3% 1.1%

Total liabilities 1,544,597 1,585,239 1,610,771 1,610,771 1,636,719 1,664,747 1,632,203 1,664,805 2.0% 3.4%Minority interests 78 76 90 90 93 95 97 96 -1.5% 6.9%

Total stockholders' equity 143,080 140,191 149,725 149,725 154,051 148,337 157,505 161,645 2.6% 8.0%


stockholders' equity1,687,754 1,725,505 1,760,586 1,760,586 1,790,862 1,813,179 1,789,806 1,826,546 2.1% 3.7%

Yearly Results Quarterly Results

1. Dec 10 numbers are preliminary and have yet to be reviewed by our auditors.

CFHCs P&L (consolidated)


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29

CFHC s P&L (consolidated)

NT$ million 2007 2008 2009 4Q09 1Q10 2Q10 3Q10 4Q101 QoQ(%) 12M09 12M10

1 YoY (%)

Operating Income

Net interest income 32,743 29,767 22,360 5,876 5,887 6,055 6,268 6,467 3.2% 22,360 24,677 10.4%

Fee income 25,027 22,525 22,677 6,237 6,403 6,115 6,358 6,688 5.2% 22,677 25,563 12.7%

Long term investment income (91) 39 66 6 25 28 26 23 -12.3% 66 102 55.6%

Trading income (loss) - equity, MTM (210) 1,572 1,448 604 (127) 1,198 162 98 -39.6% 1,448 1,331 -8.1%

Trading income (loss) - FI , MTM 461 78 2,336 98 91 109 364 530 45.7% 2,336 1,093 -53.2%

Derivatives & FX 3,061 5,832 2,927 425 589 1,211 623 249 -60.0% 2,927 2,673 -8.7%

Other income (loss) (2,013) 8 (5,332) 76 (403) (1,522) (573) (386) -32.7% (5,332) (2,883) -46%

Operating Revenue 58,978 59,820 46,481 13,323 12,465 13,195 13,227 13,669 3.3% 46,481 52,555 13.1%

Non interest expensesOperating expenses (29,977) (29,446) (29,194) (7,907) (7,185) (7,415) (8,840) (8,689) -1.7% (29,194) (32,129) 10.1%

Business tax (1,522) (1,391) (1,098) (371) (295) (309) (300) (328) 9.2% (1,098) (1,233) 12.3%

Total non-interest expenses (31,498) (30,837) (30,292) (8,278) (7,481) (7,724) (9,140) (9,017) -1.3% (30,292) (33,362) 10.1%

Pre-provision profit 27,480 28,983 16,189 5,045 4,984 5,471 4,087 4,651 13.8% 16,189 19,193 18.6%

Credit loss provisions, net (9,915) (12,621) (12,433) (4,650) (268) (720) 110 (985) -991.7% (12,433) (1,863) -85.0%

Net profit before income tax 17,565 16,362 3,756 395 4,716 4,751 4,197 3,666 -12.6% 3,756 17,330 361.4%

Net profit after income tax 13,339 14,707 2,431 1,515 3,759 3,756 3,502 3,117 -11.0% 2,431 14,134 481.4%

Preferred dividend 1,050 1,050 1,050 263 263 263 263 263 0.2% 1,050 1,050 0.0%

Income after preferred dividend 12,289 13,657 1,381 1,253 3,497 3,493 3,240 2,854 -11.9% 1,381 13,084 847.4%

Yearly Results Quarterly Results YTD Results


CTCBs Balance Sheet (consolidated)


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30

CTCB s Balance Sheet (consolidated)


Assets:

Cash and due from banks 161,812 134,154 135,831 135,831 113,941 128,262 139,167 125,803 -9.6% -7.4%

Securities, net 316,504 350,549 471,148 471,148 512,966 474,679 429,678 464,540 8.1% -1.4%

Loans, net 875,970 921,675 905,880 905,880 928,924 961,612 964,205 989,417 2.6% 9.2%

A/R, net 137,311 114,399 111,341 111,341 103,659 115,909 113,614 124,402 9.5% 11.7%

LT investments, net 1,896 2,170 2,203 2,203 2,190 2,157 2,185 2,132 -2.4% -3.2%

Land, premises and

equipments, net33,766 33,171 33,843 33,843 33,720 33,559 33,398 33,045 -1.1% -2.4%

Others 63,408 132,788 66,888 66,888 67,444 69,687 70,448 60,984 -13.4% -8.8%

Total assets 1,590,667 1,688,906 1,727,135 1,727,135 1,762,844 1,785,865 1,752,695 1,800,323 2.7% 4.2%

Liabilities:

Deposits 1,187,249 1,236,505 1,322,542 1,322,542 1,348,692 1,356,600 1,352,706 1,367,817 1.1% 3.4%

Other liabilities 299,956 337,550 284,876 284,876 290,168 308,233 273,078 302,897 10.9% 6.3%

Total liabilities 1,487,205 1,574,055 1,607,417 1,607,417 1,638,860 1,664,833 1,625,784 1,670,714 2.8% 3.9%Minority interests 59 58 71 71 74 76 78 77 -1.9% 8.5%

Total stockholders' equity 103,403 114,792 119,646 119,646 123,910 120,956 126,833 129,532 2.1% 8.3%


stockholders' equity1,590,667 1,688,906 1,727,135 1,727,135 1,762,844 1,785,865 1,752,695 1,800,323 2.7% 4.2%




32/38

CTCBs Loan Breakdown - Consolidated


33/38

32

CTCB s Loan Breakdown - Consolidated


Corporate loans

Manufacturing 103,272 119,021 102,645 102,645 100,461 108,683 111,388 116,295 4.4% 13.3%

Commerce & services 57,598 53,476 52,501 52,501 50,497 42,416 31,473 31,070 -1.3% -40.8%

Government & Non-prof. Org. 29,514 33,732 46,569 46,569 86,455 94,751 91,620 93,369 1.9% 100.5%

Construction & real estate 31,752 31,856 25,192 25,192 25,059 27,233 27,913 27,644 -1.0% 9.7%

Finance & insurance 35,884 39,020 30,857 30,857 26,573 30,879 23,022 25,454 10.6% -17.5%

Others 47,034 34,754 65,680 65,680 69,280 61,568 64,779 67,336 3.9% 2.5%

NTD loans 305,054 311,859 323,444 323,444 358,324 365,530 350,195 361,169 3.1% 11.7%

Foreign currency loans 195,765 232,379 205,150 205,150 199,223 216,009 226,812 228,732 0.8% 11.5%Sub-total 500,819 544,238 528,594 528,594 557,547 581,539 577,006 589,901 2.2% 11.6%

Retail loans

Mortgages 295,164 301,301 303,593 303,593 301,319 304,982 307,924 314,553 2.2% 3.6%

Car loans 3,630 1,249 254 254 148 79 40 19 -51.8% -92.4%

Unsecured loans 71,982 67,166 67,301 67,301 67,796 71,777 75,259 79,379 5.5% 17.9%

Small business loan 5,434 5,349 7,596 7,596 8,343 9,542 11,532 13,721 19.0% 80.6%

Sub-total 376,210 375,066 378,744 378,744 377,607 386,380 394,755 407,673 3.3% 7.6%

Non-accrual account 11,174 14,051 12,285 12,285 6,282 6,093 4,507 4,632 2.8% -62.3%

Total loans 888,203 933,355 919,623 919,623 941,436 974,012 976,269 1,002,206 2.7% 9.0%



CTCBs Deposit Breakdown - Consolidated


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33

CTCB s Deposit Breakdown Consolidated

NT$ million 2007 2008 2009 Dec 09 Mar 10 Jun 10 Sep 10 Dec 101 QoQ(%) YoY (%)

Deposits

Checking & demand deposits 90,634 87,985 122,781 122,781 113,667 125,278 121,035 119,994 -0.9% -2.3%

Saving deposits 281,839 257,161 363,212 363,212 376,711 359,415 413,729 403,726 -2.4% 11.2%

Sub-total 372,473 345,145 485,993 485,993 490,378 484,692 534,764 523,721 -2.1% 7.8%

Time & savings

Time deposits (incl. CD) 232,414 260,041 255,691 255,691 293,519 306,239 247,076 256,188 3.7% 0.2%

Time saving deposits 257,743 264,071 235,708 235,708 232,066 229,686 232,209 234,850 1.1% -0.4%

Sub-total 490,158 524,112 491,399 491,399 525,585 535,925 479,285 491,038 2.5% -0.1%

Remittances 977 458 1,573 1,573 1,414 526 660 535 -19.0% -66.0%

Foreign currency deposits 323,641 366,790 343,576 343,576 331,315 335,457 337,997 352,524 4.3% 2.6%

Total deposits 1,187,249 1,236,505 1,322,542 1,322,542 1,348,692 1,356,600 1,352,706 1,367,817 1.1% 3.4%

Quarterly ResultsYearly Results


CTCBs Spread - Consolidated


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34

CTCB s Spread Consolidated

% 2007 2008 2009 4Q09 1Q10 2Q10 3Q10 4Q101 QoQ(% ) 12M09 12M10

1 YoY (%)

NTD

Lending rate 3.82% 3.81% 2.43% 2.25% 2.25% 2.23% 2.27% 2.40% 13bp 2.43% 2.29% -14bp

Deposit rate 1.35% 1.49% 0.74% 0.51% 0.45% 0.45% 0.48% 0.51% 2bp 0.74% 0.47% -26bp

NTD spread2 2.47% 2.32% 1.70% 1.75% 1.80% 1.78% 1.79% 1.89% 10bp 1.70% 1.82% 12bp

Foreign currency

Lending rate 7.31% 5.48% 4.09% 3.83% 3.78% 3.87% 3.74% 3.69% -5bp 4.09% 3.77% -32bp

Deposit rate 3.39% 2.41% 0.95% 0.61% 0.56% 0.55% 0.54% 0.48% -7bp 0.95% 0.53% -42bp

Foreign currency spread2 3.92% 3.07% 3.14% 3.22% 3.22% 3.32% 3.20% 3.21% 2bp 3.14% 3.24% 10bp

NTD & foreign currency

Lending rate 4.57% 4.22% 2.83% 2.63% 2.60% 2.60% 2.61% 2.70% 9bp 2.83% 2.63% -20bp

Deposit rate 1.87% 1.75% 0.79% 0.53% 0.48% 0.48% 0.50% 0.50% 0bp 0.79% 0.49% -31bp

Overall spread2 2.70% 2.47% 2.04% 2.09% 2.12% 2.12% 2.12% 2.21% 9bp 2.04% 2.14% 11bp

NIM 2.18% 1.98% 1.44% 1.47% 1.46% 1.46% 1.49% 1.51% 2bp 1.44% 1.48% 4bp


1. 4Q10 & 12M10 numbers are preliminary and have yet to be reviewed by our auditors.

2. Credit card receivables are excluded in the calculation of NTD, foreign currency, and overall loan spread, and is included in the calculation of NIM.

CTCBs NII & Fee Breakdown - Consolidated


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35

CTCB s NII & Fee Breakdown Consolidated

NII Breakdown

% 2007 2008 2009 4Q09 1Q10 2Q10 3Q10 4Q101 QoQ(%) 12M09 12M10

1 YoY (%)

Loan interest & other interest 49,297 45,357 28,734 6,711 6,508 6,711 7,032 7,271 3.4% 28,734 27,522 -4.2%

Revolving interest 5,008 4,357 2,811 654 639 606 622 614 -1.3% 2,811 2,481 -11.8%

Interest income frommarketable securities 8,208 8,149 4,641 1,110 1,161 1,176 1,184 1,243 5.0% 4,641 4,764 2.6%

Interest expense (30,517) (28,368) (13,803) (2,569) (2,394) (2,426) (2,568) (2,698) 5.1% (13,803) (10,085) -26.9%

Net interest income 31,997 29,495 22,384 5,906 5,915 6,067 6,270 6,430 2.5% 22,384 24,682 10.3%


Fee Breakdown

% 2007 2008 2009 4Q09 1Q10 2Q10 3Q10 4Q101 QoQ(%) 12M09 12M10

1 YoY (%)

Retail business group

Credit card business 6,882 7,873 7,380 1,949 1,810 1,716 1,771 1,725 -2.6% 7,380 7,021 -4.9%

Wealth management business 8,895 4,689 6,773 4,231 1,993 2,097 2,153 2,562 19.0% 6,773 8,805 30.0%

Banking business 1,238 1,716 1,917 544 500 543 511 555 8.5% 1,917 2,110 10.1%

Corporate business group 2,585 2,532 2,529 665 746 762 688 662 -3.8% 2,529 2,858 13.0%

Lottery Center 2,432 2,783 2,722 667 937 709 706 706 -0.1% 2,722 3,058 12.3%

Total fee income 22,032 19,593 21,321 8,056 5,986 5,828 5,829 6,209 6.5% 21,321 23,852 11.9%


2


2. Wealth management fee jumped up from 4Q09 partially due to change of profit sharing scheme between CTCB and CTIB.

CTCBs Asset Quality - Consolidated


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36

CTCB s Asset Quality Consolidated


(NT$mm) 2007 2008 2009 4Q09 1Q10 2Q10 3Q10 4Q101 QoQ(%) 12M09 12M10

1 YoY (%)

90-days NPLs - beginning 14,187 14,945 15,651 15,779 12,852 7,563 6,653 5,983 -10.1% 15,651 12,852 -17.9%

New NPL influx, net of recovery &

others19,977 12,488 9,610 969 (2,422) 1,291 65 561 766.6% 9,610 (505) -105.3%

Write-offs & other deductions (19,219) (11,782) (12,409) (3,896) (2,868) (2,200) (735) (734) -0.2% (11,823) (6,537) -44.7%

90-days NPLs - ending 14,945 15,651 12,852 12,852 7,563 6,653 5,983 5,810 -2.9% 12,852 5,810 -54.8%

Provisions for credit loss

Provision for loan loss, net 6,898 7,688 11,389 4,600 266 879 (201) 706 -451.5% 11,389 1,649 -85.5%

Provision for credit card loss, net 3,228 2,512 970 112 8 (66) 22 207 863.2% 970 171 -82.4%

Others, net (51) 2,412 74 (63) (5) (92) 69 71 3.8% 74 43 -42.2%

Total provisions 10,076 12,612 12,433 4,649 268 721 (110) 985 -991.2% 12,433 1,863 -85.0%

Total reserves 12,233 11,680 13,743 13,743 12,512 12,400 12,063 12,789 6.0% 13,743 12,789 -6.9%

2007 2008 2009 Dec 09 Mar 10 Jun 10 Sep 10 Dec 101 QoQ

(bp;pp) 12M09 12M101 YoY

(bp;pp)

90-day NPL ratio

Corporate NPL ratio 1.44% 1.69% 1.78% 1.78% 0.85% 0.72% 0.68% 0.69% 1bp 1.78% 0.69% -1pp

Retail NPL ratio 2.01% 1.66% 0.86% 0.86% 0.73% 0.63% 0.52% 0.42% -10bp 0.86% 0.42% -44bp

Total NPL ratio 1.68% 1.68% 1.40% 1.40% 0.80% 0.68% 0.61% 0.58% -3bp 1.40% 0.58% -1pp



CTCBs Credit Card & Cash Card Business


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37

C C s C ed t Ca d & Cas Ca d us essCredit Card Business

(NT$mm, %) 2007 2008 2009 Dec 09 Mar 10 Jun 10 Sep 10 Dec 101 QoQ(%) YoY (%)

Card in circulation (accumulative) (thousand) 5,632 5,118 4,948 4,948 4,978 5,033 5,096 5,166 1.4% 4.4%

Card consumption (Cash advance & spending)

(yearly & quarterly)283,095 270,183 242,238 68,686 65,362 64,536 67,897 72,261 6.4% 5.2%

Revolving balance 32,630 23,640 22,046 22,046 21,827 20,507 20,561 20,332 -1.1% -7.8%

Credit card receivables (incl. non-accrual

account) 70,367 63,386 60,767 60,767 56,305 59,516 56,465 58,948 4.4% -3.0%

Reserves for credit card loss 1,029 919 872 872 842 783 764 729 -4.6% -16.4%

Coverage ratio (over 90 days overdues) 100.00% 117.64% 176.19% 176.19% 189.35% 208.67% 220.86% 235.37% 15pp 59pp

Delinquency ratio (30 - 90 days overdues) 1.87% 1.91% 1.59% 1.59% 1.55% 1.36% 1.35% 1.19% -16bp -40bp

NPL ratio (90-day overdues) 1.46% 1.23% 0.81% 0.81% 0.79% 0.63% 0.61% 0.53% -9bp -29bp

Write off ratio (180 days overdues)2

8.11% 4.19% 1.75% 1.69% 0.34% 0.16% -0.03% -0.22% -18bp -2pp


Cash Card Business

(NT$mm, %) 2007 2008 2009 Dec 09 Mar 10 Jun 10 Sep 10 Dec 101 QoQ(%) YoY (%)

Card in circulation (accumulative) (thousand) 190 144 117 117 112 107 102 98 -4.4% -16.6%

Debt outstanding 14,190 9,902 7,566 7,566 7,079 6,657 6,254 5,833 -6.0% -22.9%

Reserves for cash card loss 417 296 308 308 296 267 271 315 1.7% 2.6%

Coverage ratio (over 90 days overdues) 100.00% 102.86% 141.83% 141.83% 142.69% 150.28% 180.71% 385.23% 205pp 243pp

Delinquency ratio (30-90 days overdues) 3.54% 2.70% 1.76% 1.76% 1.65% 1.41% 1.10% 0.93% -16bp -83bp

NPL ratio (90 days overdues) 2.94% 2.90% 2.87% 2.87% 2.93% 2.67% 2.40% 1.40% -100bp -146bp

Write off ratio (180 days overdues)2 26.07% 19.18% 7.39% 7.39% 6.11% 7.92% 8.13% 8.48% 35bp 1pp


1. Dec 10 numbers are preliminary and have yet to be reviewed by our auditors.2. Write off ratios are YTD annualized numbers.

Documents

4Q10AM Prez+Appx ENG AefaIHFmfrbH p969BcdFNeUJ