Taishin Shin Kong FHC: Respecting Regulatory Oversight, Shin Kong Life to Make Additional Foreign Exchange Reserve Provisions
Following the merger of Taishin and Shin Kong Financial Holding Companies, the foreign exchange price fluctuation reserve of subsidiary Shin Kong Life decreased by over 40% when the books were opened in January this year, drawing market attention. Taishin Shin Kong FHC issued a statement today emphasizing that to respect the supervisory principles of the competent authority, its subsidiary Shin Kong Life has complied by adjusting relevant accounting treatments and will handle the matter of additional provisions.
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- 📰 Published: May 14, 2026 at 20:56
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(Central News Agency, Taipei, 14th) Following the merger of Taishin and Shin Kong Financial Holding Companies, the foreign exchange price fluctuation reserve of subsidiary Shin Kong Life decreased by over 40% when the books were opened in January this year, drawing market attention. Taishin Shin Kong FHC issued a statement today emphasizing that to respect the supervisory principles of the competent authority, its subsidiary Shin Kong Life has complied by adjusting relevant accounting treatments and will handle the matter of additional provisions.
At the end of last year, Shin Kong Life's foreign exchange reserve was NT$99.6 billion. On the opening day of the books on January 1 this year, it was NT$56.0 billion, a decrease of 43.7%, which attracted attention. Financial Supervisory Commission (FSC) Chairman Peng Chin-lung stated in response to questions at the Legislative Yuan's Finance Committee this week that the foreign exchange reserve is a statutory reserve, not an accounting issue. There are regulations for its appropriation and withdrawal, and withdrawal also requires FSC approval.
In response, Taishin Shin Kong FHC explained in a press release today that both the holding company parent and its subsidiary, Shin Kong Life, handled the merger accounting in accordance with accounting standards and related interpretations from the Accounting Research and Development Foundation, and that there was no adjustment or withdrawal of Shin Kong Life's foreign exchange reserve.
As for subsequent actions, Taishin Shin Kong FHC emphasized that for the additional requirements proposed by the FSC's Insurance Bureau for financial supervision, which differ from generally accepted accounting principles, Shin Kong Life expresses its respect and will cooperate in making the additional provisions.
Taishin Shin Kong FHC also explained that the difference in the measurement basis this time was the result of applying IFRS for merger accounting. When Shin Kong Life became a subsidiary of Taishin Shin Kong FHC on the merger date (July 24, 2025), the parent holding company was required to re-measure assets and liabilities at fair value (i.e., market price) in accordance with IFRS 3 'Business Combinations'.
Taishin Shin Kong FHC stated that on the merger date, the foreign exchange price fluctuation reserves on the books of both the parent and subsidiary were consistent. However, because Shin Kong Life must maintain its individual financial statements until it is dissolved upon merger on December 31, 2025, the accounting measurement basis applicable to its individual financial reports naturally differs from the group level. Subsequent exchange rate fluctuations led to a gap in the calculation basis for provisions, which in turn affected the expressed balance of the foreign exchange price fluctuation reserve; however, Shin Kong Life's foreign exchange reserve was not adjusted or withdrawn as a result.
Furthermore, Taishin Shin Kong FHC believes that this case is the first instance of a life insurance subsidiary consolidation after the merger of two Taiwanese financial holding companies, involving intersecting issues of merger accounting and insurance regulatory norms, which is unprecedented. To respect the supervisory principles of the competent authority, Shin Kong Life has complied by adjusting the relevant accounting treatment and disclosed it in its Q1 financial report.
Taishin Shin Kong FHC added that this adjustment is a one-time adjustment arising from the difference in merger accounting treatment basis and does not affect current profit or loss or capital adequacy ratio. Overall operations and policyholder rights are not affected. (Editor: Pan Yi-ching) 1150514
At the end of last year, Shin Kong Life's foreign exchange reserve was NT$99.6 billion. On the opening day of the books on January 1 this year, it was NT$56.0 billion, a decrease of 43.7%, which attracted attention. Financial Supervisory Commission (FSC) Chairman Peng Chin-lung stated in response to questions at the Legislative Yuan's Finance Committee this week that the foreign exchange reserve is a statutory reserve, not an accounting issue. There are regulations for its appropriation and withdrawal, and withdrawal also requires FSC approval.
In response, Taishin Shin Kong FHC explained in a press release today that both the holding company parent and its subsidiary, Shin Kong Life, handled the merger accounting in accordance with accounting standards and related interpretations from the Accounting Research and Development Foundation, and that there was no adjustment or withdrawal of Shin Kong Life's foreign exchange reserve.
As for subsequent actions, Taishin Shin Kong FHC emphasized that for the additional requirements proposed by the FSC's Insurance Bureau for financial supervision, which differ from generally accepted accounting principles, Shin Kong Life expresses its respect and will cooperate in making the additional provisions.
Taishin Shin Kong FHC also explained that the difference in the measurement basis this time was the result of applying IFRS for merger accounting. When Shin Kong Life became a subsidiary of Taishin Shin Kong FHC on the merger date (July 24, 2025), the parent holding company was required to re-measure assets and liabilities at fair value (i.e., market price) in accordance with IFRS 3 'Business Combinations'.
Taishin Shin Kong FHC stated that on the merger date, the foreign exchange price fluctuation reserves on the books of both the parent and subsidiary were consistent. However, because Shin Kong Life must maintain its individual financial statements until it is dissolved upon merger on December 31, 2025, the accounting measurement basis applicable to its individual financial reports naturally differs from the group level. Subsequent exchange rate fluctuations led to a gap in the calculation basis for provisions, which in turn affected the expressed balance of the foreign exchange price fluctuation reserve; however, Shin Kong Life's foreign exchange reserve was not adjusted or withdrawn as a result.
Furthermore, Taishin Shin Kong FHC believes that this case is the first instance of a life insurance subsidiary consolidation after the merger of two Taiwanese financial holding companies, involving intersecting issues of merger accounting and insurance regulatory norms, which is unprecedented. To respect the supervisory principles of the competent authority, Shin Kong Life has complied by adjusting the relevant accounting treatment and disclosed it in its Q1 financial report.
Taishin Shin Kong FHC added that this adjustment is a one-time adjustment arising from the difference in merger accounting treatment basis and does not affect current profit or loss or capital adequacy ratio. Overall operations and policyholder rights are not affected. (Editor: Pan Yi-ching) 1150514