Legal basis:
The Financial Examination Bureau (FEB) is empowered under Paragraph 1 of Article 2 and Article 4 & 5 of the “Organic Act of the Financial Supervisory Commission (FSC)” and other applicable financial laws to conduct financial examinations of financial institutions within the FSC’s jurisdiction. In addition, according to Paragraph 1 of Article 7 of the “Agricultural Finance Act”, the FEB is commissioned by the Ministry of Agriculture to conduct examinations of agricultural financial institutions.
Types of financial examinations:
Financial examinations consist of full-scope examinations, targeted examinations, and commissioned examinations.
The frequency and implementation of examinations:
A. Implementation of Full-scope Examinations:
i. The FEB will examine head offices of financial institutions, in principle, once in every 2-year period. The examination frequency for these institutions also depends on the assessment results of the differential financial examination mechanism.
ii. Implementation of full-scope examinations during the first half of 2025 and in 2024:
| Types of financial institutions | 2025.1-6 | 2024 |
|---|---|---|
| Financial holding companies | 4 | 6 |
| Domestic banks * | 22 | 47 |
| Foreign bank branches in Taiwan | 5 | 13 |
| Credit cooperatives | 6 | 10 |
| Bills finance companies | 2 | 3 |
| Life insurance companies | 2 | 9 |
| Non-life insurance companies | 8 | 10 |
| Securities firms, securities investment trust companies and securities finance companies | 13 | 26 |
| Specialized electronic payment institutions | 2 | - |
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Note: The statistics include full-scope examinations for head offices, domestic and foreign branches of the institutions.
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B. Implementation of Targeted Examinations:
Based on financial supervisory information and the FSC’s supervisory policies, the targeted examinations the FEB has conducted in 2024 and during the first half of 2025 are as following:
i. The targeted examinations conducted by the FEB during the first half of 2025 were “Equity-linked products and interest rate derivatives for domestic banks”, “Credit extension business (including real estate loan business) for domestic banks, credit cooperatives and bills finance companies”, “Insurance brokerage or agency business conducted through bancassurance channels (including procedures of anti-money laundering, counter-terrorism financing, and non-proliferation of weapons)”, “Management of information and communication security for securities firms”, “Brokerage trading of foreign securities conducted by securities firms”, “Business operations (including operations of acquiring, internal management, and anti-money laundering) and IT operations for the institutions engaging in credit card business”.
ii. The targeted examinations conducted by the FEB in 2024 were “Oversees and management of subsidiaries for FHCs”, “Internal management (including Oversees of investee companies) for domestic banks”, “Liquidity risk management mechanism for domestic banks”, “Risk control mechanism of fraud prevention for domestic banks”, “The management mechanism of wealth management specialists and financial customer protection for domestic banks”, “Credit extension business (including real estate loan business) for domestic banks and bills finance companies”, “Information security of exo-service-system for insurance companies”, “Equity investment and risk management for insurance companies”, “Business of insurance broker companies and insurance agent companies (including procedures of anti-money laundering, counter-terrorism financing, and non-proliferation of weapons)”, “Financial customer protection for insurance companies and securities companies”, “Management of information and communication security for securities firms ”, “Management of outsourcing processes for securities firms”, “Securities firms branches”, “Investment risk management and information disclosure for ETFs by securities investment trust companies”, “Real estate loan business and the rights and interests protection for disable and elderly customers of credit cooperatives”, “Business operations (including operations of acquiring, internal management, and anti-money laundering) and IT operations for the institutions engaging in credit card business and specialized electronic payment institutions”, “Operation of anti-money laundering, counter-terrorism financing, and non-proliferation of weapons regulations in each sector of financial industry [including virtual asset service providers (VASPs)]”, “Postal savings, remittances businesses, and internal management of Chunghwa Post Co., Ltd.” and etc.
C. Commissioned examinations:
According to Paragraph 1 of Article 7 of the “Agricultural Finance Act”, the FEB is commissioned by the Ministry of Agriculture to conduct examinations at agricultural financial institutions. In total, the FEB completed 40 examinations during the first half of 2025 and 115 examinations in 2024.