Chang Hwa Bank|Corporate Social Responsibility-Equator Principles

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Equator Principles(EPs)

1. Origin

In order to respond to global sustainability development trend and support efficient deployment of sustainable finance, CHANG HWA COMMERCIAL BANK, LTD. (hereinafter the "Bank") voluntarily signed the "Equator Principles” (hereinafter referred to as "EPs/EP") in April 2022 to implement the review and management of environmental and social risks in large project financing.

2. EP Project Evaluation Team

The Credit Management Division form the "EP Project Evaluation Team" for effective implementation of the Equator Principles. Be responsible review and confirm applicability check of EPs and the result of risk categorization for credit projects, complete the "Environmental and Social Risk Checklist for Equator Principles Project" and environmental and social risk review, handle the annual review of credit projects applying the EPs.

3. Credit Work Process of EPs Projects

Bank incorporates the Equator Principles in all aspects of the credit process, with the sales unit and the Credit Management Division carrying out processes such as case suitability judgment, case risk classification, environmental and social risk assessment and review, submission and signing of contracts, and post-lending management.

Case suitability check and risk classification:
When a case is submitted for credit, executes the judgment of applicability in accordance with the EPs, and classifies the case into Category A, Category B (including Specific Category B and General Category B), and Category C according to the potential environmental and social risks.
Required document:
According to the result of case risk classification, we will collect relevant documents of the Equator Principles from the client and fill in the preliminary opinions.

Environmental and social risk assessment and review:
When a case is confirmed to be compliant with the EPs, the reviewer should consider the evaluation of the above information and consider the environmental and social risks of the case for reference in granting or rejecting the credit.
Submission and signing of contracts:
After the approval of the case review, the sales unit will attach an EPs commitment clause to the contract based on the risk classification of the case and the review result and sign a contract with the customer that meets the requirements of the EPs.
Post-lending management:
For Category A and Category B (including general and specific) cases, the annual review of credit cases applying the EPs should be carried out at least once a year. Ensure that customers are indeed managed in accordance with contractually committed terms.

4. 2022-2023 Equator Principles Cases

• Project Finance

Number of Project Finance	Category A	Category B	Category C
Number of Project Finance	0	0	1
Sector
Mining	0	0	0
Infrastructure	0	0	0
Oil & Gas	0	0	0
Power	0	0	0
Other	0	0	1
Region
Americas	0	0	0
Europe, Middle East & Africa	0	0	0
Asia Pacific	0	0	1
Country Designation
Designated Country	0	0	0
Non-Designated Country	0	0	1
Independent Review
Yes	0	0	/
No	0	0	/