S E A Holdings Limited — M&A Activity 2000

May 10, 2000

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from, or in reliance upon, the whole or any part of the contents of this announcement.

LIPPO LIMITED LIPPO CHINA RESOURCES LIMITED

力寶有限公司 力寶華潤有限公司

("Lippo") ("LCR")

(Incorporated in Hong Kong with limited liability) (Incorporated in Hong Kong with limited liability)

Connected transaction Connected transaction

THE HONG KONG BUILDING AND LOAN

AGENCY LIMITED

THE HKCB BANK HOLDING COMPANY LIMITED 香港建屋貸款有限公司

("HKCB Holding") ("HKBLA")

(Incorporated in Bermuda with limited liability) (Incorporated in Hong Kong with limited liability)

Major and connected transaction Major and connected transaction

JOINT ANNOUNCEMENT

CONDITIONAL PURCHASE OF MORTGAGE LOANS FROM HKBLA BY HKCB

CONDITIONAL PURCHASE OF CONTROLLING STAKE

IN HKBLA FROM HKCB BY LCR

POSSIBLE MANDATORY GENERAL OFFER BY SOMERLEY

ON BEHALF OF LCR

FOR ALL THE ISSUED SHARES IN HKBLA NOT ALREADY OWNED BY LCR

OR PARTIES ACTING IN CONCERT WITH IT

The boards of directors of Lippo, LCR, HKCB Holding and HKBLA announce that agreements were signed on 9th May, 2000 in respect of the Proposals, which comprise three main elements:

(i) the Mortgage Agreement, whereby HKBLA has agreed to sell to HKCB certain mortgages with a principal amount before provisions of approximately HK$905 million (net of provisions - approximately HK$886 million) for a consideration of approximately HK$841.7 million, representing a discount of 5% to the principal amount (net of provisions), subject to adjustment. HKBLA will use substantially all the proceeds to repay the Syndicated Loan, which has a principal amount outstanding and due for repayment on 12th June, 2000 of HK$832.5 million;

(ii) the Share Acquisition Agreement, whereby LCR has agreed to acquire an indirect controlling interest of approximately 58.6% in HKBLA from HKCB for a cash sum of approximately HK$176.2 million, payable as described below, equivalent to HK$1.337 per HKBLA Share. HKCB will retain 11,250,000 HKBLA Shares (5%) for investment purposes; and

(iii) the possible Offer which will be made by LCR for all HKBLA Shares not owned by LCR or parties acting in concert with it at HK$1.337 per HKBLA Share if the above two agreements complete. If made, the Offer would be an unconditional offer in cash for HKBLA Shares ex the recommended 1999 final dividend of HK$0.08 per HKBLA Share (i.e. accepting shareholders would be entitled to receive and retain such dividend).

Trading in HKBLA Shares was suspended with effect from 10:00 a.m. on 17th April, 2000 and will be resumed with effect from 10:00 a.m. on 10th May, 2000.

INTRODUCTION

The Lippo Board, LCR Board, HKCB Holding Board and HKBLA Board announce that they have reached agreement on conditional proposals relating to the transfer of assets from HKBLA to HKCB, the transfer of a controlling interest in HKBLA from HKCB to LCR and for a possible general offer to be made by LCR for HKBLA Shares.

Because of the shareholding structure of the Lippo Group as set out in the chart below, the Proposals constitute connected transactions for each of Lippo, LCR, HKCB Holding and HKBLA. They are therefore subject to, inter alia, approval by the independent shareholders of such companies. The Mortgage Agreement and the Share Acquisition Agreement are major transactions for HKCB Holding and for HKBLA. The Mortgage Agreement and the Share Acquisition Agreement are also special deals for HKBLA under Rule 25 of the Code.

The following is a summary of the three principal elements of the Proposals:

(i) Mortgage Agreement dated 9th May, 2000

Vendor: HKBLA

Purchaser: HKCB

Assets sold: The Mortgage Loans with an aggregate outstanding principal amount as at 31st March, 2000 (net of provisions for bad and doubtful debts) of approximately HK$886 million presently owned by HKBLA, subject to adjustment for any repayments of principal and any new loans made by HKBLA prior to completion out of proceeds of such repayments.

Consideration: HK$841,685,000 payable in cash on completion from the proceeds of sale of HKCB Corporation and the internal resources of HKCB, representing approximately a 5% discount to the aggregate outstanding principal amount of the Mortgage Loans as at 31st March, 2000 (net of provisions for bad and doubtful debts), subject to adjustment for any repayments of principal and any new loans made by HKBLA prior to completion out of proceeds of such repayments. A 5% discount was considered by the parties as an appropriate discount for a bulk purchase of long-term receivables such as the Mortgage Loans.

Conditions: (i) approval by the independent shareholders of each of Lippo, LCR, HKCB Holding and HKBLA, if and as required under the Listing Rules and/or the Code;

(ii) the Share Acquisition Agreement becoming unconditional in all respects, except for the condition relating to the Mortgage Agreement becoming unconditional; and

(iii) all necessary consents and approvals being obtained including, without limitation, under the Syndicated Loan.

The parties shall use all reasonable endeavours to procure that the conditions are satisfied by a long stop date no later than 30th June, 2000 or, in the event that the parties agree, a later date.

Completion: 9th June, 2000, being the last Business Day prior to the maturity date of the Syndicated Loan, or such other date as the parties may agree. HKCB may nominate any wholly-owned subsidiary of HKCB Holding to take its place for the purposes of completion and such nominee shall, subsequent to completion and upon the obtaining of the requisite approval from the Hong Kong Monetary Authority, transfer the Mortgages to HKCB Finance Limited, a wholly-owned subsidiary of HKCB.

HKBLA is an indirect 63.6% owned subsidiary of HKCB. The Mortgage Agreement constitutes a connected transaction for both HKCB Holding and HKBLA under the Listing Rules, and is therefore subject to approval of the independent shareholders of HKCB Holding and HKBLA at their respective general meetings. It also constitutes a major transaction for HKCB Holding and for HKBLA, and a connected transaction for Lippo and LCR, as HKCB and HKBLA are their non wholly-owned subsidiaries. As the terms of the Mortgage Agreement apply only to HKCB and cannot be extended to all HKBLA shareholders, the Mortgage Agreement is considered a special deal under Rule 25 of the Code and requires the consent of the Executive. Such consent will normally be given if, inter alia, the special deal is approved by a resolution of independent shareholders of HKBLA taken on a poll.

The effect of the Mortgage Agreement on the mortgage portfolio of HKBLA as at 31st March, 2000 may be analysed as follows:

Sale of

As at 31st Mortgage Retained

March, 2000 Loans to HKCB Mortgages

HK$ million HK$ million HK$ million

Mortgage loans 1,115 (905 ) 210

Less: provisions for bad and

doubtful debts (36 ) 19 (17 )

1,079 (886 ) 193

(ii) Share Acquisition Agreement dated 9th May, 2000

Vendor: HKCB

Purchaser: LCR

Assets sold: HKCB's entire interest in its wholly-owned subsidiary, HKCB Corporation, which will on completion of the Share Acquisition Agreement own 131,818,755 HKBLA Shares, representing approximately 58.6% of the present issued share capital of HKBLA of 225,000,000 HKBLA Shares.

Holding of HKBLA HKCB Corporation presently owns 143,068,755 HKBLA Shares.

Shares by HKCB: Prior to completion of the Share Acquisition Agreement, 11,250,000 HKBLA Shares (5%) will be transferred to HKCB, to be retained for investment purposes.

Consideration: HK$176,241,675.44, payable in cash in two instalments:

(i) as to HK$96,241,675.44, at completion; and

(ii) as to HK$80 million, less the aggregate amount due from HKCB to HKBLA in respect of any retained mortgages as at 30th December, 2000 required to be purchased (for the reasons set out below) by HKCB from HKBLA on 30th December, 2000. A period of approximately six months has been allowed as a reasonable period after completion for any of the repayment conditions specified below (e.g. failure to make repayments) to become apparent.

The consideration is equivalent to HK$1.337 per HKBLA Share.

The consideration was based on arm's length negotiations, bearing in mind, inter alia, the 1999 earnings of HKBLA of HK$48.0 million (equivalent to earnings per share of HK$0.21) and the pro forma net assets of HKBLA on completion of the Mortgage Agreement of approximately HK$1.242 per HKBLA Share.

Conditions: (i) approval by the independent shareholders of each of Lippo, LCR, HKCB Holding and HKBLA, if and as required under the Listing Rules and/or the Code;

(ii) the Mortgage Agreement becoming unconditional in all respects, except for the condition relating to the Share Acquisition Agreement becoming unconditional;

(iii) consent of the Executive to a special deal under Note 4 to Rule 25 of the Code;

(iv) all necessary consents and approvals being obtained; and

(v) the listing and trading of HKBLA Shares on the Stock Exchange not having been withdrawn or cancelled and the HKBLA Shares being continuously traded prior to the completion date (save for any temporary suspension pending any public announcement) and the Stock Exchange not having indicated that such listing is likely to be withdrawn or conditions being attached thereto and the SFC not having indicated that it will object to such continued listing.

The parties shall use all reasonable endeavours to procure that the conditions are satisfied by a long stop date no later than 30th June, 2000 or, in the event that the parties agree, a later date.

Completion: 9th June, 2000, being the last Business Day prior to maturity date of the Syndicated Loan, or such other date as the parties may agree.

Purchase of retained LCR and/or HKBLA can require HKCB to purchase mortgages

mortgages: retained by HKBLA (i.e. the approximately HK$193 million principal amount (net of provisions) not being disposed of under the Mortgage Agreement) if at any time on or before 20th December, 2000, it is shown that such retained mortgages do not satisfy certain specified conditions and HKCB fails to remedy such non-compliance within 10 days. The specified conditions are principally to the effect that the mortgages are properly secured and insured, not regarded by HKBLA as irrecoverable to any extent and there is no outstanding payment due for more than 30 days which has not been provided for.

The audited net profit before taxation of HKBLA for the years ended 31st December, 1999 and 1998 was HK$55.3 million and HK$40.4 million respectively.

The relationship between Lippo, LCR, HKCB Holding and HKBLA is set out in the section headed "Shareholding structure of Lippo Group before the Proposals". The Share Acquisition Agreement constitutes a connected and major transaction under the Listing Rules for HKCB Holding and HKBLA and constitutes a connected transaction for Lippo and LCR. It is therefore subject to approval of the independent shareholders of HKCB Holding, HKBLA, Lippo and LCR at their respective general meetings. As the terms of the Share Acquisition Agreement relating to the purchase of retained mortgages set out above cannot be extended to all HKBLA shareholders, the Share Acquisition Agreement is considered a special deal under Rule 25 of the Code and requires the consent of the Executive. Such consent will normally be given if, inter alia, the special deal is approved by a resolution of independent shareholders of HKBLA taken on a poll.

(iii) Possible mandatory general offer

If the Share Acquisition Agreement becomes unconditional and is completed, Somerley will, on behalf of LCR, make an unconditional cash offer for all the issued HKBLA Shares, other than those acquired indirectly by LCR through its acquisition of the entire issued share capital of HKCB Corporation and those held by parties acting in concert with LCR, including HKCB, on the following basis:

For each HKBLA Share HK$1.337 in cash

HKBLA has no warrants, options or convertible securities outstanding.

Basis of Offer price

The Offer price is equivalent to the consideration payable by LCR under the Share Acquisition Agreement.

Effect of accepting the Offer

The HKBLA Shares will be acquired free of all liens, charges and encumbrances and together with all rights attaching thereto at the date of this announcement, other than the recommended final dividend for the year ended 31st December, 1999 of HK$0.08 per HKBLA Share, payable to HKBLA shareholders on 9th June, 2000.

Stamp duty

Stamp duty at a rate of HK$1.125 for every HK$1,000 or part thereof on the amount payable in respect of acceptances of the Offer will be deducted from the amount payable to HKBLA shareholders who accept the Offer.

Funding

The consideration payable under the Offer will be funded by LCR from its own internal resources. Somerley has confirmed that it is satisfied that sufficient financial resources are available to LCR to satisfy acceptance of the Offer in full.

Comparison with net assets/market price

The Offer price of HK$1.337 per HKBLA Shares represents:

(i) a discount of approximately 7.1% to the audited net asset value per HKBLA Share of HK$1.439 as at 31st December, 1999;

(ii) a premium of approximately 7.6% to the audited net asset value as at 31st December, 1999, adjusted for the discount on the Mortgage Loans negotiated as part of the Mortgage Agreement of HK$1.242 per HKBLA Share;

(iii) a premium of approximately 5.3% to the value of HKBLA based on the closing price per HKBLA Share (less the recommended final dividend of HK$0.08 per share) of HK$1.27 on 14th April, 2000, being the last day of trading prior to the suspension of trading on 17th April, 2000; and

(iv) a premium of approximately 16.2% to the value of HKBLA based on the average ex-dividend closing price per HKBLA Share of HK$1.151 for the last 10 trading days up to the suspension of trading on 17th April, 2000.

Warning: The Offer will only be made if the Mortgage Agreement and the Share Acquisition Agreement, which are subject to a number of conditions, are completed. Accordingly, the Offer is a possibility only. HKBLA shareholders are urged to exercise caution in dealing in the HKBLA Shares.

There have been no dealings in the HKBLA Shares by LCR or any parties acting in concert with LCR for the six months prior to the date of this announcement.

SHAREHOLDING STRUCTURE OF LIPPO GROUP BEFORE THE PROPOSALS

The shareholding structure of the Lippo Group before the Proposals is as follows:

listed on the Stock Exchange

* based on management accounts as at 31st March, 2000

REASONS FOR THE PROPOSALS

(i) HKBLA - Sale of the Mortgage Loans

The principal business of HKBLA is the provision of mortgage finance to owner occupiers of residential flats in the middle income group.

The HKBLA Board has been considering various alternatives in light of the maturity of the Syndicated Loan, of which HK$832,500,000 remains outstanding, due for repayment in one lump sum on 12th June, 2000. It has concluded that the best course of action for HKBLA and its shareholders would be the sale of approximately 82% of its mortgage loan portfolio, sufficient to repay the Syndicated Loan fully. As at 31st March, 2000, the total mortgage loan portfolio of HKBLA was approximately HK$1,115 million, before provisions of HK$36 million, resulting in a net principal outstanding of approximately HK$1,079 million. The sale of the Mortgage Loans will eliminate the high level of gearing of HKBLA, which currently has borrowings representing approximately 250% of net assets. HKBLA will retain an ungeared portfolio of mortgages of approximately HK$193 million (net of provisions) generating cash flow and which will remain the principal business of HKBLA for the time being. However, with a view to enhancing the profitability and future prospects of HKBLA, the HKBLA Board is examining the possibility of utilising cash flow and cash deposits not required to support its mortgage business to make investments in high-technology applications related principally to financial services, but no concrete proposals are yet under study.

The unaudited profit before taxation attributable to the Mortgage Loans for the years ended 31st December, 1999 and 1998 was HK$45.3 million and HK$33.1 million respectively, on the basis that 82% of the profitability of HKBLA for those years can be attributed to the Mortgage Loans. The Mortgage Loans represent approximately 82% of the principal amount outstanding (net of provisions) of HKBLA's mortgage portfolio as at 31st March, 2000. The terms of the Mortgage Agreement including the consideration were arrived at after arm's length negotiations and based on normal commercial terms. The proceeds from the sale of Mortgages of approximately HK$841.7 million will be substantially used by HKBLA to fund the repayment of the Syndicated Loan of HK$832.5 million. The balance of approximately HK$9.2 million will be retained by HKBLA as working capital. The sale of the Mortgage Loans is expected to generate a loss on book value of approximately HK$44 million for HKBLA for the year ending 31st December, 2000.

(ii) HKCB Holding - Purchase of the Mortgage Loans and Sale of HKCB Corporation

The principal businesses of HKCB Holding, its subsidiaries and associates are the provision of commercial banking, mortgage finance, securities broking, insurance and other related financial services.

Recognising the growth potential of the consumer finance sector, one of the strategic goals of HKCB Holding is to diversify its financial services it provides to consumers, either through organic growth or by acquisitions. Towards this end, HKCB Holding announced on 25th April, 2000 that its wholly-owned subsidiary, HKCB Financial Services Limited, had agreed to acquire Newcourt Credit Hong Kong Limited, a consumer finance company based in Hong Kong with a loan portfolio of approximately HK$1.4 billion.

In furtherance of its strategic goal of expanding its consumer finance businesses, the HKCB Holding Board considers that HKCB Holding would benefit mainly in the following respects from the Proposals, the completion of which will result in HKCB's direct ownership of approximately 82% of HKBLA's mortgage portfolio instead, at present, of an indirect 63.6% interest through its shareholding in HKBLA:

• In view of the high capital adequacy ratio and strong liquidity position of HKCB, the necessary funding required to finance the Mortgage Loans can be provided by HKCB directly and more economically than in the existing case of HKBLA, thereby improving the net return that HKCB can expect to earn from the Mortgage Loans.

• The enlarged loan book of HKCB after the purchase of the Mortgage Loans is expected to result in an improved risk profile and will provide opportunities for economies of scale in its underlying operations.

The HKCB Board has decided to retain a 5% interest in HKBLA for investment purposes. Such HKBLA Shares will not be assented to the Offer.

The terms of the Mortgage Agreement including the consideration were arrived at after arm's length negotiations and are based on normal commercial terms. The consideration for the purchase of the Mortgage Loans will be funded partly by the proceeds of sale of HKCB Corporation of approximately HK$176.2 million, and the remaining amount of approximately HK$665.5 million will be funded by the internal resources of HKCB. The purchase of the Mortgage Loans under the Mortgage Agreement and the sale of HKBLA Shares under the Share Acquisition Agreement are not expected to generate any material net consolidated profit or loss for HKCB Holding for the year ending 31st December, 2000.

(iii) LCR - Purchase of HKCB Corporation and the Offer

The principal activities of LCR and its subsidiaries are property investment and development, estate management, food businesses and a wide range of financial services.

The LCR Board wishes to facilitate the rationalisation of the corporate structure and businesses of its indirect subsidiaries, HKCB Holding and HKBLA, as set out above. It also wishes to acquire direct control of HKBLA as a separate listed vehicle to provide an additional means of diversifying LCR's own business. HKBLA is already an indirect subsidiary of LCR. The purchase of the controlling stake from HKCB simplifies the group structure and brings HKBLA more directly under LCR's control.

(iv) Lippo

Lippo acts principally as a holding company for the Lippo Group.

The Lippo Board considers that the Proposals will streamline the group structure and help rationalise its businesses. Although Lippo is not directly a party to the Proposals, as holding company of the Lippo Group, it should benefit from the advantages summarised above accruing to its various subsidiaries from the Proposals.

CHANGES TO THE SHAREHOLDING STRUCTURE OF LIPPO GROUP

The relevant changes to the shareholding structure of the Lippo Group on completion of the Proposals can be summarised as follows:

listed on the Stock Exchange

* before acceptances of the Offer

** based on management accounts as at 31st March, 2000

INTENTIONS OF LCR FOR HKBLA

(i) Business

As noted above, on completion of the Proposals, HKBLA will continue to manage a significant portfolio of mortgages. Following the repayment of the Syndicated Loan, the retained mortgages will generate available cash flow. LCR supports intentions of the HKBLA Board to utilise these funds and its available cash deposits for its existing business and to diversify into related areas, as set out in the section headed "Reasons for the Proposals" above.

As illustrated by the shareholding chart of the Lippo Group, the Proposals do not involve any change in the ultimate controlling shareholder of HKBLA. In such circumstances, it is normally possible for LCR to obtain a waiver from the obligation under the Code to make a mandatory cash offer. However, as LCR supports HKBLA's intention as set out above to diversify to some extent from its traditional line of business, LCR wishes to offer HKBLA shareholders the opportunity to realise their investments if they so wish.

(ii) Management and staff

It is the intention of LCR that there will be no material change to the existing management and employees of HKBLA by reason of the Offer only.

MAINTAINING THE LISTING OF HKBLA

It is the intention of LCR to maintain the listing of HKBLA on the Stock Exchange after the closing of the Offer (if made). The directors of LCR will undertake to the Stock Exchange that appropriate steps will be taken to ensure that sufficient public float exists for the HKBLA Shares. The directors of HKBLA will also jointly and severally undertake to the Stock Exchange that appropriate steps will be taken to ensure that sufficient public float exists for the HKBLA Shares.

The Stock Exchange has stated that it will closely monitor trading in the HKBLA Shares if, at the close of the Offer (if made), less than 25% of the HKBLA Shares are held by the public.

If the Stock Exchange believes that:

* a false market exists or may exist in the HKBLA Shares; or

* there are too few HKBLA Shares in public hands to maintain an orderly market,

it will consider exercising its discretion to suspend trading in the HKBLA Shares.

If HKBLA remains listed on the Stock Exchange, any acquisition or disposal of assets will be subject to the provisions of the Listing Rules. Pursuant to the Listing Rules, the Stock Exchange has the discretion to require HKBLA to issue a circular to shareholders irrespective of the size of the proposed acquisitions and disposals by HKBLA, particularly where such proposed acquisitions and disposals by HKBLA represent a departure from the principal activities of HKBLA. The Stock Exchange also has the power to aggregate a series of acquisitions and disposals by HKBLA and any such transactions may result in HKBLA being treated as if it were a new listing applicant and subject to the requirements for new listing application as set out in the Listing Rules.

SUSPENSION AND RESUMPTION OF TRADING

At the request of HKBLA, trading in HKBLA Shares on the Stock Exchange was suspended with effect from 10:00 a.m. on 17th April, 2000 pending the issue of this announcement. Application has been made by HKBLA to the Stock Exchange for the resumption of trading in the HKBLA Shares on the Stock Exchange with effect from 10:00 a.m. on 10th May, 2000.

GENERAL

An independent board committee of HKCB Holding will be formed to consider the Proposals. As regards Lippo, LCR and HKBLA, there are no directors who are not either salaried employees or also directors of other listed companies in the Lippo Group, so no independent board committees can be formed for these companies. Independent financial advisers will be appointed to advise the independent board committee of HKCB Holding and the independent shareholders of Lippo, LCR and HKBLA regarding the Proposals.

Somerley has been appointed to advise LCR in connection with the Offer and to make the Offer on its behalf.

Circulars of Lippo, LCR, HKCB Holding and HKBLA containing, among other things, details on the Proposals and a notice of general meeting will be sent to their shareholders as soon as practicable. An offer document to HKBLA shareholders containing, among other things, the terms of the Offer and the advice of the independent financial adviser in relation to the Offer, together with the relevant forms of acceptance and transfer, will be despatched within 7 days after completion of the Mortgage Agreement and the Share Acquisition Agreement. Application will be made to the Executive for a consent to despatch the Offer document on a date more than 21 days after the date of this announcement as the making of the Offer is subject to completion of the Share Acquisition Agreement and the Mortgage Agreement which is expected to take place in June 2000.

DEFINITIONS

"Business Day" a day upon which banks are open for business in Hong Kong, other than a Saturday, a Sunday and a public holiday

"Code" The Hong Kong Code on Takeovers and Mergers

"Executive" the Executive Director of the Corporate Finance Division of the SFC (or any delegate of the Executive Director)

"HKBLA" The Hong Kong Building and Loan Agency Limited, a company incorporated in Hong Kong with limited liability, the shares of which are listed on the Stock Exchange

"HKBLA Board" the board of directors of HKBLA

"HKBLA Share(s)" share(s) of HK$1.00 each in the issued share capital of HKBLA

"HKCB" The Hongkong Chinese Bank, Limited, a licensed bank incorporated in Hong Kong with limited liability and a wholly-owned subsidiary of HKCB Holding

"HKCB Board" the board of directors of HKCB

"HKCB Corporation" HKCB Corporation Limited, a company incorporated in the British Virgin Islands with limited liability and a wholly-owned subsidiary of HKCB

"HKCB Holding" The HKCB Bank Holding Company Limited, a company incorporated in Bermuda with limited liability, the shares of which are listed on the Stock Exchange

"HKCB Holding Board" the board of directors of HKCB Holding

"HKCB Holding Group" HKCB Holding and its subsidiaries

"LCR" Lippo China Resources Limited, a company incorporated in Hong Kong with limited liability, the securities of which are listed on the Stock Exchange

"LCR Board" the board of directors of LCR

"Lippo" Lippo Limited, a company incorporated in Hong Kong with limited liability, the shares of which are listed on the Stock Exchange

"Lippo Board" the board of directors of Lippo

"Lippo Group" Lippo and its subsidiaries

"Listing Rules" Rules Governing the Listing of Securities on the Stock Exchange

"Mortgage Agreement" the agreement dated 9th May, 2000 between HKBLA and HKCB relating to the sale and purchase of the mortgage portfolio of HKBLA

"Mortgage Loans" certain specified loans made by HKBLA to finance in whole or in part the purchase or remortgage of properties in Hong Kong, Kowloon and the New Territories with an aggregate outstanding principal amount (net of provisions) as at 31st March, 2000 of approximately HK$886 million, and secured by the Mortgages

"Mortgages" the Mortgage Loans and first fixed legal charges or first fixed legal mortgages in connection therewith from time to time granted in favour of HKBLA as mortgagee as security for Mortgage Loans

"Offer" the possible cash offer to be made by Somerley on behalf of LCR for the HKBLA Shares other than those owned by HKCB Corporation and HKCB and parties acting in concert with them, in accordance with the Code

"Proposals" the Mortgage Agreement, the Share Acquisition Agreement and the Offer

"SFC" Securities and Futures Commission

"Share Acquisition Agreement" the agreement between HKCB, LCR and HKBLA dated 9th May, 2000 relating to the acquisition of the entire issued share capital of HKCB Corporation

"Somerley" Somerley Limited, an investment adviser and exempt dealer registered under the Securities Ordinance (Chapter 333 of the laws of Hong Kong)

"Stock Exchange" The Stock Exchange of Hong Kong Limited

"Syndicated Loan" the HK$1.2 billion secured transferable loan facility made available to HKBLA by a syndicate of commercial banks pursuant to the loan agreement dated 30th May, 1997

By Order of the Board By Order of the Board

Lippo Limited Lippo China Resources Limited

Davy Lee Millie Luk

Secretary Secretary

By Order of the Board By Order of the Board

The HKCB Bank Holding Company Limited The Hong Kong Building and Loan Agency Limited

Andrew Hau Chan Wai Lam

Secretary Secretary

Hong Kong, 9th May, 2000

The directors of Lippo jointly and severally accept full responsibility for the accuracy of the information contained in this announcement and confirm, after having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

The directors of LCR jointly and severally accept full responsibility for the accuracy of the information contained in this announcement and confirm, after having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

The directors of HKCB Holding jointly and severally accept full responsibility for the accuracy of the information contained in this announcement and confirm, after having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

The directors of HKBLA jointly and severally accept full responsibility for the accuracy of the information contained in this announcement and confirm, after having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

"Please also refer to the published version of this announcement in the Hong Kong Standard"