Helping Share Proceeds in International Financial Markets Easily

Product Factors

1.  Launch date: December 22, 2006 to January 17, 2007

2.  Investment currency: RMB Currency

3. Subscription threshold: RMB 50 thousand

4. Supplemental fund threshold: RMB 1000

5. Investment direction: Structured notes issued by Fortis Bank, which linking to bond basket, including:

     PIMCO Emerging Market Bond, accounting for 33.3%;

     PIMCO High Yield Bond, accounting fro 33.3%;

     PIMCO Total Return Bond, accounting for 33.4%.

6. Investment term: one year

7. Principal security: USD principal could be 100% secured upon maturity

8. Expected annual return: 70% × (33.3% × Appreciation of PIMCO Emerging Market Bond + 33.3% ×   Appreciation of PIMCO High Yield Bond + 33.4% × Appreciation of PIMCO Total Return Bond).

According to the previous performance of the bonds in PIMCO bond basket, the highest expected annual return of the structured notes could over 8%.

9. Management fee: USD principal × annual fee rate, the annual fee is payable in USD.

      For investment return between 0-7% (including 7%), the annual fee rate is 0.2%;

      For investment return between 7%-10% (including 10%), the annual fee rate is 0.3%;

      For investment return over 10%, the annual fee rate is 0.5%.

10.  Entrusting fee: USD principal × annual fee rate, the annual fee charged USD with rate of 0.19%.

Risk Reminding

Since the investment fund for the wealth management product was RMB, investors needed to undertake the RMB exchange rate risk. Before activating the product, investors needed to purchase USD for investment on designated date according to the exchange rate prevailing on the date of conversion; upon the maturity of the product, investors needed to convert the USD principal and profits into RMB on designated date according to the exchange rate prevailing on the date of conversion.

In the interest of avoiding client's exchange rate risk, Industrial Bank would offer forward foreign exchange settlement service for clients who desired to avoid the above risk. Investors could choose whether to accept the service or not in agreement.

Product advantages

• Advanced investment idea

Catering well to the investment opportunities of international bond markets; selecting for customers the trump bond products under best bond-fund management companies in a globalwide range; investing in the structured notes linking to bond basket.

• Prudent Assets management

After converting the wealth management fund into U.S. Dollar, the U.S. Dollar principal could be 100% secured.

• High expected return

The product profit pegged to the PIMCO Emerging Market Bond, PIMCO High Yield Bond, and PIMCO Total Return Bond. According to the previous performance of the bonds in PIMCO bond basket, the highest expected annual return of the structured notes could over 8%.

• Effective risk control

The product profit linked to 3 high-quality bond categories, achieving quick assets accretion and effective risk decentralization at the same time, offering sustained and stable investment return for investors.

• Flexible avoidance of exchange rate risk

According to their judgment of exchange rate between RMB and USD, investors could choose whether to accept the forward foreign exchange settlement service by our bank or not.