First Financial Holding Co. Ltd. — AGM Information 2016

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The Meeting Minutes of 2016 Annual General Meeting for First Financial Holding Company (the “Company”) (Excerpt Translation)

Date and Time: June 24, 2016 at 9:00 a.m.

Place: 22 Fl., No.30, Sec. 1, Chung King S. Rd., Taipei City (the auditorium of the headquarters of First Commercial Bank Co., Ltd.)

Total outstanding shares of the Company: 11,461,106,381 shares Total shareholders reside in China: 2,777,322 shares Total outstanding shares eligibly for the meeting: 11,458,329,059 shares Total shares represented by shareholders present: 6,721,512,481 shares Percentage of share held by shareholders present: 58.66%

Attendees: Chao-Dong Chang(Attorney-at-law)

James Huang(CPA)

Chairman: Ching-Nain Tsai, the Chairman of the Board of Directors Recorder: Hui-An Tsang, Yu-Shan Lee

1. Chairman of the Meeting announced that the aggregate shareholding of shareholders present constituted a quorum so that the Meeting began.

2. Opening speech of the Chairman (Omitted).

Welcome to First Financial Holding Company AGM 2016. To confirm to the decree, it is proposed that certain articles of “The Articles of Incorporation of the Company” be amended, other than the regular report and recognition matters. To meet the best practice of corporate governance and in line with the implementation of e-voting system, proposals of discussion matters in first phase and recognition and discussion matters in third phase will be voted by poll individually. Shareholders shall be concise on each voiced statement for meeting efficiency.

Procedural Issues

1. Shareholder (No. 0550051) questioned about the meeting agenda, and suggested to combine all discussion matters into one section.

2. Shareholder (No. 4514165) spoke of issues about meeting procedures.

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Each issue was explained by Attorney-at-law.

Discussion Matters

Proposal:

To conform to the amendment to the Company Act, it is proposed that certain articles of "The Articles of Incorporation of the Company" be amended.

Explanation:

• (i) The major amendments to the Articles of Incorporation are summarized as below:

  • (a) To conform to the amendment to Article 235 of the Company Act, deleting certain provisions regarding distributions of employee bonuses and director and supervisor remuneration in Article 34 of the Articles of Incorporation.

  • (b) To conform to the newly promulgated Article 235-1 of the Company Act and an interpretative ruling No. 10402427800 dated October 15, 2015 issued by the Ministry of Economic Affairs, adding a new provision regarding employee and director remuneration distributions in Article 34-1 of the Articles of Incorporation.

• (ii) Attachment please find the comparison table of the amended articles and description thereto. (Detailed in Meeting Handbook, page 6-7.)

• (iii) This proposal has been approved by the 9th board meeting of the 5th term of the Board of Directors.

Upon emcee’s announcement and explanation of discussion matter,

1. Shareholder (No. 0550051) questioned about the amendments to the Articles of Incorporation, which failed to reduce the ratio of payout for director remuneration, and actual and projected payout of director and supervisor remuneration in 2014 and 2015 respectively.

2. Shareholder (No. 4724043) suggested that the distributions of employee bonuses and director and supervisor remuneration should be discussed by Remuneration Committee and resolved by Board of Directors, and also suggested the Articles of Incorporation shall include Audit Committee’s functions.

3. Shareholder (No. 4429572) questioned about several issues, including meeting procedure, the cause and follow-ups of certain penalized cases in prior two years, and related issues of director and supervisor remuneration.

4. Shareholder (No. 4689675) concerned about the distribution of employee bonuses, and the gap between employee and management team. The shareholder also spoke the issue of

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employee’s pay raise.

After adequate discussion and explanations from Chairman, President, and Attorney-at-law, Chairman announced to rule the voting process.

Resolution:

Presenting by shareholders (present or proxy): 6,740,448,419 shares

Approved votes: 5,958,320,622 shares/88.40% (4,811,031,332 shares from E-voting) Against votes: 7,984,905 shares (1,708,355 shares from E-voting)

Abort votes: 774,142,892 shares (766,946,082 shares from E-voting)

RESOLVED , that the amended Articles of Incorporation be and hereby were approved as submitted.

Report Matters

• (i) President reported the business operation of the Company in 2015. (Detailed in Meeting Handbook, page 12-15.)

  1. Shareholder (No. 4724043) concerned about several issues, including the follow-ups after fraudulent withdrawal incident recently, P/L of overseas branches, interbank lending and borrowing, funding operation, credit charges, and investment criteria.

  2. Shareholder (No. 4689675) asked several issues, including employee’s pay raise, branch numbers in mainland China, loan and syndication exposures, causes of losses in insurance business, communication with labor union, and the follow-ups of several loan-loss cases recently.

  3. Shareholder (No. 7770006) spoke of issues about China exposures, Trust for Elderly Care, strategy about retirees, and proxy solicitation.

  4. Shareholder (No. 4400806) concerned the resignation of First Securities’ President, and also inquired of issues about Company and its subsidiaries’ losses and deficiencies.

  5. Shareholder (No. 7770008) questioned that the First Bank’s employees’ group insurance were paid by employees, while those of other subsidiaries were paid by companies. The shareholder also inquired of issues about ESOP Trust and talent retaintion.

  6. Shareholder (No. 7770013) concerned about the losses from First-Aviva, FCB

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International Leasing, and FCB Lease (Xiamen).

1. Shareholder (No. 0550051) spoke of issue about Employees’ Contracts.

Each issue was responded respectively by Chairman, President of First Bank, Chairman of First Securities, and President of First-Aviva.

• (ii) Audit Committee reported the auditing process of 2015 financial statements. (Detailed in Meeting Handbook, page17~18.)

  1. Shareholder (No. 4689675) concerned about Group’s business strategy, and suggested Audit Committee to supervise the business of China branches, and what caused the losses.

  2. Shareholder (No. 4432939) praised of operating results and the team efforts.

Each issue was responded respectively by convener of Audit Committee, and Accountant.

• (iii) Report of the distribution of employee’s compensation and director’s remuneration in 2015.

Explanation:

• (i) This proposal was to conform to Article 235-1 of the Company Act and Article 34-1 of the Articles of Incorporation of Company, and has been approved by the 10th board meeting of the 5th term of the Board of Directors.

• (ii) The distribution was listed below:

Net profit before tax which has not deducted employee’s compensation and director’s remuneration: NTD 16,133,017,168

Employee’s compensation distributed – Cash (0.0523%): NTD 8,437,568

Director’s remuneration distributed – Cash (0.9%): NTD 145,197,155

1. Shareholder (No. 0550051) suggested for lowering director remuneration.

The issue was responded by President.

Recognition & Discussion Matters

• (i) Business Report and Consolidated Financial Statements for the Year 2015. (Detailed in Meeting Handbook, page 24-41.)

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Explanation:

The Company's business operation report and consolidated financial statements for the year 2015 have been reviewed by Audit Committee and duly approved by the 10[th] meeting of the 5[th] term of Board of Directors as described in the Meeting Handbook (Detailed in page 17-18.). The consolidated financial statements have been audited by James Huang and Charles Lai, the certified public accountants in PricewaterhouseCoopers, and a report in connection therewith has been submitted by the President and Audit Committee of the Company. The business report and consolidated financial statements are hereby respectfully submitted for recognition.

Upon emcee’s announcement and explanation of recognition matter, shareholder (No. 0550051) inquired of several issues, including the cause of losses, reason of penalty from FSC, and the re-cap plan for First-Aviva. After adequate discussion and explanations from President of First-Aviva, Chairman announced to rule the voting process.

Resolution:

Presenting by shareholders (present or proxy): 6,746,424,957 shares Approved votes: 5,926,608,824 shares/87.85% (4,779,473,871 shares from E-voting) Against votes: 6,940,377 shares (1,497,564 shares from E-voting)

Abort votes: 812,875,756 shares (798,714,334 shares from E-voting)

RESOLVED , that the Business Report and the Consolidated Financial Statements of 2015 be and hereby were approved as submitted.

• (ii) Distribution of 2015 Profits. (Detailed in Meeting Handbook, page 43.)

Explanation:

1. The after tax net income of the Company in year 2015 is NT$16,006,088,414. In accordance with the Articles of Incorporation of the Company and other applicable laws to retain 10% thereof in the amount of NT$1,600,608,841 as the legal reserve, and after taking into account the adjusted accumulated profits NT$7,562,342,211 of the Company, the total distributable profit of this year is NT$21,967,821,784 and is proposed to be distributed as follows:

   • A. NT$10,888,051,062 as cash dividends (NT$0.95 per share).

   • B. NT$5,157,497,870 as stock dividends (45 new shares per 1,000 existing shares).

   • C. Year-end balance of accumulated profits is NT$5,922,272,852.

2. The adjusted accumulated profits of NT$7,562,342,211 as above sourced from the

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accumulated profits of NT$8,160,500,781 at beginning of 2016, deduct the actuarial adjustments defined benefit plans of NT$598,158,570 from other comprehensive income.

1. After the distribution of profit is approved by this Meeting, the Board of Directors is authorized both to set a record date for the distribution of cash dividends, and, after the capital increase of the Company is approved by the competent authorities, set a record date for the distribution of stock dividends.

2. Cash dividends was calculated and rounded down to dollar in proportion to stakeholding. The total amount of odd fraction will be counted as other income of Company.

3. If the number of the outstanding shares of the Company is subsequently changed due to any share buy-back by the Company, the transfer, conversion, cancellation of the shares or other circumstances resulting in the increase or decrease of the number of the outstanding shares, the Board of Directors then is authorized to adjust the distribution of dividends as appropriate.

4. This proposal for the distribution of profits has been approved by the 11[th] meeting of the 5[th] term of Board of Directors and duly reviewed by Audit Committee.

Upon emcee’s announcement and explanation of recognition matter, no shareholder raise opinion. Chairman announced to rule the voting process.

Resolution:

Presenting by shareholders (present or proxy): 6,746,424,957 shares

Approved votes: 5,958,353,319 shares/88.32% (4,811,355,191 shares from E-voting) Against votes: 6,773,633 shares (1,580,364 shares from E-voting)

Abort votes: 781,298,005 shares (766,750,214 shares from E-voting)

RESOLVED , that the distribution of 2015 profits be and hereby were approved as proposed.

• (iii) Please approve the Issuance of new shares via capitalization of profits of 2015.

Explanation:

1. In order to boost capital base and strengthen financial structure, it is proposed to appropriate NT$ 5,157,497,870 from the 2015 distributable earnings as stock dividends pursuant to Article 240 of the Company Act. The par value of the shares to be issued is NT$10 and the total number of the common shares to be issued is 515,749,787 shares and the total paid-in capital would reach

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NT$119,768,561,680.

1. The Board of Directors is authorized to set the record date for the proposed capital increase after the approval of competent authority in connection therewith is granted. The distribution of the new shares should be made to the shareholders with no consideration at the ratio of 45 new shares for every 1,000 shares held by shareholders according to their respective shareholding as stated in shareholders’ register book on the record date. Shareholders may, within five days from the record date for stock dividend, apply to the stock affairs agent of the Company to combine fractional shares into one share. Odd lots less than one share thus collected by the Company will be placed at its par value with specific parties as determined by the Chairman under the authorization of the AGM.

2. The rights and obligations of the new shares to be issued under the proposed capital increase shall be the same as those of the existing shares of the Company.

3. The Board of Directors is authorized to make necessary amendment to the proposed capital increase if so instructed by the competent authority.

4. If the number of the outstanding shares of the Company is subsequently changed due to any share buy-back by the Company, the transfer, conversion, cancellation of the shares or other circumstances resulting in the increase or decrease of the number of the outstanding shares, the Board of Directors is authorized to adjust the distribution of dividends as appropriate.

5. This proposal has been approved by the 11th Board Meeting of the 5th term of Board of Directors and duly reviewed by Audit Committee.

Upon emcee’s announcement and explanation of discussion matter, shareholder (No. 0770513) suggested strategy for creating Company value, and helping boost stock price of FFHC. After adequate discussion and explanations from the President, Chairman announced to rule the voting process.

Resolution:

Presenting by shareholders (present or proxy): 6,746,424,957 shares

Approved votes: 5,948,271,337 shares/88.17% (4,811,636,511 shares from E-voting) Against votes: 1,921,721 shares (1,921,721 shares from E-voting) Abort votes: 796,231,899 shares (766,127,537 shares from E-voting)

RESOLVED , that the capital increase from earnings in 2015 be and hereby were approved as proposed.

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Extemporary motions:

• (i) Shareholder (no. 0941246) spoke the issue of a joint effort project of a hotel construction.

• (ii) Shareholder (no. 4729936) addressed the viewpoints of improving branches facilities. The shareholder also spoke of issues about mortgage application and Company marketing.

  • After explanations from Chairman, there being no other business and extemporary motion, upon a motion duly made and second, the meeting was adjourned at 12:20 a.m.

Ching-Nain Tsai Chairman of the meeting

Hui-An Tsang /Yu-Shan Lee Recorder

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