Regulations Governing Internal Operating Systems and Procedures for Banks Conducting Financial Derivatives Business Article 20

Banks conducting financial derivatives business shall report transaction information to the Commission and an agency designated by the Commission.Banks shall report information relating to customers' credit limits for financial derivatives transactionsto the Joint Credit Information Center ("JCIC") according to JCIC operating rules.When a bank extends or renews credit to customers other than professionalinstitutional investors for financial derivatives transactions, the bank shall ask the customer toprovide information on the credit limits extended to the customer by other financial institutions for financial derivatives transactions or inquire the information with JCIC.A bank shall extend credit limitto customers for financial derivatives transactions, withreference to the information obtained under the preceding paragraph, based on due consideration of the customer’s risk bearing capability, risk appetite and credit limits extended to the customer by other financial institutions to avoid exposingthe customer to risks beyond his/her risk bearing capability. The competent authority shall prescribe the control mechanism for credit limits granted by a bank to its customers.When a bank provides customers other than professional institutional investors and high net worth corporate investors with financial derivatives transaction services other than structured products, the bank shall establish initial margin requirements and margin call mechanism. The competent authority shall prescribe the minimum initial marginrequirements.