Bank of Kaohsiung Co. Ltd (First Year Implementation)

Bank of Kaohsiung officially became a member of the Equator Principles Association on March 25, 2025.

To guide enterprises in emphasizing environmental protection and social responsibility, the Bank has formulated the “Bank of Kaohsiung Guidelines for Loans Applicable to the Equator Principles” on October 7, 2024, and integrated these guidelines into the credit review process.

• Roles and Responsibilities of Reviewers

Recognizing that the business units serve as the Bank’s first line of defense and are the entities most directly and frequently in contact with clients, these units are responsible for conducting Equator Principles assessments. The Credit Management Department’s Review Section established an Environmental and Social Risk Task Force to act as the review body, with participation from colleagues who have educational or professional backgrounds in environmental education or environmental engineering.

When a business unit receives a credit application, it must complete the “Equator Principles Applicability Checklist” to determine whether the case falls within the scope of the Equator Principles. For credit cases that qualify as “Project Finance” or “Project-Related Corporate Loans,” the unit must fill out the “Environmental and Social Risk Assessment Form” for evaluation, and the Review Section conducts the review.

• Project Classification

• Financing Review Process

For credit cases classified as Category A or B, the business unit must obtain an Environmental and Social Risk Assessment Report issued by an independent third-party organization. After the initial review, the unit must prepare an Environmental and Social Risk Review Report and submit it to the Credit Management Department for deliberation and approval.Furthermore, for credit cases requiring ongoing monitoring as specified in the Review Report, the business unit shall, during the loan period, at least once per year, request the borrower to provide an Environmental and Social Risk Monitoring Report issued by an independent third-party organization, along with relevant documentation.

To identify and assess potential environmental and social risks, the Bank has developed an “Environmental and Social Risk Assessment Form.”

This framework categorizes evaluations into five major types — location impact, environmental impact, social impact, and integrated assessment.

It further examines eight thematic issues, including biodiversity, resource efficiency and pollution prevention, labor conditions, and employment opportunities, encompassing a total of 18 risk factors for a comprehensive assessment of environmental and social risks.

• Employee Training

In terms of training, Bank of Kaohsiung conducted a total of three internal training sessions on the Equator Principles in 2024 (Year 113): January 16 (1.5 hours), July 8 (1 hour), and December 13 (1.5 hours). The cumulative training time was 4 hours, with 234 total participants. The Bank will continue to conduct such annual internal training sessions to strengthen awareness and implementation of the Equator Principles among employees.