Article 5
A credit cooperative shall evaluate credit assets on and off balance sheet in accordance with Articles 3 and 4 herein, and shall allocate sufficient loan loss provision and reserves against liability on guarantees. The minimum loan loss provision and guarantee reserve shall be 1% of the outstanding balance of Category 1 credit assets (excluding assets that represent claims against ROC government agencies, including central and local governments), 2% of the outstanding balance of Category 2 credit assets, 10% of the outstanding balance of Category 3 credit assets, 50% of the outstanding balance of Category 4 credit assets, and 100% of outstanding balance of Category 5 credit assets.
To strengthen the ability of credit cooperatives to bear the loss of specific credit assets, the central competent authority may, if deemed necessary, require credit cooperatives to raise loan loss provision and guarantee reserve for specific credit assets.

Article 7
"Non-Performing Loans" as referred to in the Regulations shall refer to those loans for which the principal or interest has been in arrears for three (3) months or more, and those loans which the principal or interest has not yet been in arrears for more than three (3) months, but with regard to which the credit cooperative has sought payment from primary/subordinate debtors or has disposed of collateral.
If a restructured loan meets certain conditions, the negotiated interest rate is not lower than the original loan or the rates of new loans in the same risk category, and the negotiated terms have been performed for over six (6) months, the loan may be exempted from reporting as a non-performing loan. However, if the negotiated installment payments are in arrears for three (3) months or more during the period of exemption as non-performing loans, the loan shall still be reported as such.
The "certain conditions" referred to in the preceding paragraph shall include the following circumstances:
1. Those were originally short-term loans with annual repayment of principal and interest generally over 10%. However, the maximum loan period shall be five (5) years.
2. Those were originally mid-/long-term loans with an installment payment period limited to twice the original remaining number of years. However, the maximum loan period shall be thirty (30) years. The installments paid within the original remaining number of years may not be less than 30% of the owed principal and interest. If a mid-/long-term has no remaining number of years, or twice the remaining number of years is less than five (5) years, the installment payment period may be extended to five (5) years, and the annual repayment of principal and interest shall generally be over 10%.
The term "payment period" in the first paragraph shall be the agreed-upon date for restructured loans and other extensions of credit. However, if the credit cooperative requests earlier repayment in accordance with the contract, the repayment period of which the credit cooperative notifies the debtor shall be the payment period.

Article 17-1
The minimum loan loss provision and reserves against liability on guarantees for Category1 credit assets for a credit cooperative that is calculated according to Paragraph 1 of Article 5 amended on January 28, 2014 shall be fully allocated within one year from the date the amendment is implemented. A credit cooperative with legitimate reasons may, before the aforementioned deadline and after it has obtained approval from its board of directors, apply to the central competent authority for an extension of not more than four years.

Article 18
These Regulations shall take effect on July 1, 2005.
These Regulations amended and promulgated on November 18, 2010 shall take effect on January 1, 2011.
These Regulations amended and promulgated on January 28, 2014 shall take effect on January 1, 2014.