Standard Chartered PLC — M&A Activity 2006

Oct 20, 2006

Standard Chartered

STANDARD CHARTERED PLC

(Registered in England and Wales number 966425)

STOCK CODE: 2888

RECOMMENDED TENDER OFFER FOR HSINCHU INTERNATIONAL BANK

DISCLOSEABLE TRANSACTION

THIS CIRCULAR IS FOR YOUR INFORMATION AND, OTHER THAN AS DESCRIBED IN THE FIRST PARAGRAPH BELOW, REQUIRES NO ACTION ON YOUR PART.

If you have sold or transferred all your shares in Standard Chartered PLC, you should at once hand this circular to the purchaser(s) or transferee(s) or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, 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 circular.

The Placing Shares (as defined on page 6 of this circular) have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and they may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

20 October 2006

---

CONTENTS

PAGE

LETTER FROM THE BOARD. 1
INTRODUCTION 1
TAIWAN AND HSINCHU 2
DETAILS OF THE ACQUISITION. 3
ACQUISITION RATIONALE AND BENEFITS 4
STANDARD CHARTERED IN TAIWAN 5
FINANCIAL IMPACT OF THE ACQUISITION. 5
CURRENT TRADING. 6
BUSINESS DESCRIPTION 7
CONCLUSION. 7
ADDITIONAL INFORMATION. 7
APPENDIX - GENERAL INFORMATION 8

This circular includes "forward-looking statements". All statements other than statements of historical facts included in this circular, including, without limitation, those regarding Standard Chartered's and Hsinchu's financial position, business strategy, plans and objectives of management for future operations, are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors which may cause the actual results, performance or achievements of Standard Chartered or Hsinchu, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding Standard Chartered's or Hsinchu's present and future business strategies and the environments in which Standard Chartered and Hsinchu will operate in the future and such assumptions may or may not prove to be correct. There are a number of factors which could cause actual results, performance of Standard Chartered or Hsinchu, or industry results to differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results, performance of Standard Chartered or Hsinchu, or industry results to differ materially from those described in the forward-looking statements are Standard Chartered's ability to successfully combine the business of Standard Chartered and Hsinchu and to realise expected synergies from that combination, changes in global, political, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax rates and future business combinations or dispositions. These forward-looking statements speak only as at the date of this circular. Standard Chartered expressly disclaims any obligation (except as required by the rules of the UK Listing Authority and the London Stock Exchange or the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited) or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in Standard Chartered's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

No statement in this circular is intended to be a profit forecast and no statement in this circular should be interpreted to mean that earnings per share of Standard Chartered for the current or future financial years would necessarily match or exceed the historical published earnings per share of Standard Chartered.

• i -

---

LETTER FROM THE BOARD

Standard Chartered

20 October 2006

Dear Shareholder

RECOMMENDED TENDER OFFER FOR HSINCHU INTERNATIONAL BANK

On 29 September 2006, Standard Chartered PLC ("Standard Chartered" or the "Company") announced that its subsidiary company, Standard Chartered Bank, launched on that day a recommended tender offer for 100 per cent of the issued and to be issued share capital of Hsinchu International Bank ("Hsinchu"), the seventh largest private sector bank in Taiwan by loans and deposits as at 30 June 2006. The tender offer price of NTD24.50 per share values Hsinchu's entire issued share capital at USD1.2 billion (GBP0.65 billion) on a fully diluted basis. The recommended tender offer, which is subject to a minimum acceptance condition of 51 per cent and to the satisfaction of remaining regulatory consents, is expected to be completed in November 2006.

The acquisition constitutes a discloseable transaction of the Company under the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Hong Kong Listing Rules").

The purpose of this circular is to give you further information regarding the acquisition and other information required by the Hong Kong Listing Rules for a discloseable transaction. This circular also complies with the Listing Rules of the UK Listing Authority (being the Financial Services Authority acting in its capacity as the competent authority for the purposes of Part VI of the Financial Services and Markets Act 2000) (the "UK Listing Rules").

INTRODUCTION

Standard Chartered's strategic intent is to be the world's best international bank, leading the way in Asia, Africa and the Middle East. Hsinchu provides Standard Chartered with an attractive opportunity to strengthen its position in Taiwan, creating a new engine for growth. The offer will result in the first outright acquisition of a Taiwanese bank by an international bank.

Taiwan is the fifth largest economy in Asia with GDP of USD15,200 per capita, comparable with Korea. Taiwan is the fourth largest banking market in Asia, with a revenue pool of approximately USD29 billion in 2005.¹ Although the banking industry in Taiwan continues to be affected by the significant downturn in the consumer credit cycle experienced since the second half of 2005, Standard Chartered believes that the cycle is turning and that Taiwan offers attractive growth prospects.

Through Hsinchu, Standard Chartered will be strongly positioned to capitalise on the huge expansion of trade and investment flows between Taiwan and the rest of Asia. Exports to mainland China increased by 750 per cent from 2001 to 2005, with exports to mainland China, Hong Kong and Korea accounting for approximately 39 per cent of total exports from Taiwan in 2005. Following the acquisition of Hsinchu, Standard Chartered's presence in the key North East Asian markets of Korea, Taiwan, Hong Kong and mainland China will be one of the largest of the international banks, with a network of over 580 branches, including 86 branches in Taiwan.

¹ Standard Chartered estimates

---

LETTER FROM THE BOARD

Hsinchu is a well managed bank with a strong presence in the three wealthiest regions of Taiwan: Taipei, Taoyuan and Hsinchu. As at 30 June 2006, Hsinchu had total assets of approximately USD13 billion. It has over 2.4 million consumer deposit accounts and over 115,000 corporate and small and medium sized enterprise ("SME") deposit accounts. Together with Standard Chartered's existing business, the acquisition of Hsinchu would have made Taiwan Standard Chartered's fourth largest market by income for the six months ended 30 June 2006.

Significant income synergies and incremental expense savings are expected to be achieved through the acquisition. Strong double digit income growth is expected in both Consumer and Wholesale Banking through the introduction of Standard Chartered's products and sales practices to Hsinchu and by leveraging Standard Chartered's international network.

The tender offer price of NTD24.50 per share represents: a premium of 40 per cent to Hsinchu's closing share price of NTD17.45 on 28 September 2006; 12.7 times Hsinchu's reported after tax earnings in 2005; and 2.3 times Hsinchu's reported net asset value as at 30 June 2006.

Standard Chartered will finance the acquisition using the proceeds of an institutional placing of Standard Chartered new ordinary shares which was completed on 4 October 2006 and raised net proceeds of approximately USD1.2 billion (GBP0.65 billion).

The acquisition of Hsinchu is expected to be earnings accretive and achieve double digit return on investment ("ROI") in 2008.

TAIWAN AND HSINCHU

Hsinchu represents an attractive opportunity to significantly enhance Standard Chartered's presence in Taiwan. Taiwan is the fifth largest economy in Asia and is Asia's fourth largest banking market, with a revenue pool of approximately USD29 billion in 2005. Taiwan has a population of approximately 23 million with an attractive demographic profile and its GDP per capita is one of the highest in Asia (comparable with that of Korea). Taiwan is integral to Standard Chartered's Asia strategy, with Taiwanese investment in mainland China and Taiwan-related trade flows having grown significantly in recent years. Exports to mainland China increased by 750 per cent from 2001 to 2005, and account for 21 per cent of total Taiwanese exports. Hong Kong accounted for a further 15 per cent of total Taiwanese exports in 2005. Following the acquisition of Hsinchu, Standard Chartered will have a significant presence in the key North East Asian markets of Korea, Taiwan, Hong Kong and mainland China with a network of over 580 branches, strengthening its position as one of the largest international banks in the region.

Hsinchu was established by three local families in 1948 as a savings association, and in 1983 was the first private sector bank to list on the Taiwan Stock Exchange. At 28 September 2006, Hsinchu had a market capitalisation of USD861 million. Hsinchu has a strong presence in the three wealthiest regions in Taiwan: Taipei, Taoyuan and Hsinchu. Some of the world's largest, and Taiwan's fastest growing, technology companies are located in Hsinchu's Science Park. Hsinchu:

• is the seventh largest private sector bank in Taiwan by loans and deposits as at 30 June 2006
• provides Consumer and Wholesale Banking products and services through its network of 83 branches
• provides its customers with a range of products and services including deposits, mortgages, consumer loans, credit cards, wealth management, trade finance and foreign exchange
• has an extensive customer base, consisting of over 2.4 million consumer deposit accounts and over 115,000 corporate and SME deposit accounts

• had more than 3,300 employees as at 30 June 2006

• 2 -

---

LETTER FROM THE BOARD

In recent years, Hsinchu's management has transformed the business, building a significant Consumer Banking business, investing in technology and prudently managing its loan portfolio. Hsinchu has a market share of approximately 10 per cent in both deposits and loans in the regions of Taoyuan and Hsinchu.

Based on Taiwanese GAAP accounts as at 30 June 2006, Hsinchu reported:

• total assets of approximately NTD419 billion (USD12.7 billion)
• total loans of approximately NTD298 billion (USD9.1 billion)
• net assets of approximately NTD17 billion (USD527 million)

For the 12 months ended 31 December 2005, Hsinchu recorded profit before tax of approximately NTD3,344 million (USD102 million) and profit after tax of approximately NTD3,191 million (USD97 million). For the equivalent period in 2004, Hsinchu recorded profit before tax of approximately NTD3,014 million (USD92 million) and profit after tax of approximately NTD2,808 million (USD85 million). For the six months ended 30 June 2006, Hsinchu recorded a loss before tax of approximately NTD3,132 million (USD95 million) and loss after tax of approximately NTD2,733 million (USD83 million) owing to provisions of approximately NTD6,276 million (USD191 million) primarily reflecting the consumer credit conditions experienced by all market participants.

Hsinchu's consumer loans represent 51 per cent of total assets, with mortgages representing 23 per cent, personal loans 13 per cent, SME loans 11 per cent and credit and cash cards less than 1 per cent of total assets respectively. Hsinchu's wholesale loans and other assets represent the remaining 49 per cent of total assets. Hsinchu had a non-performing loan ("NPL") ratio of 2.77 per cent as at 30 June 2006, 2.46 per cent as at 31 December 2005 and 2.83 per cent as at 31 December 2004. It had a total capital ratio of 9.81 per cent as at 30 June 2006. 25 per cent of unsecured consumer receivables in the Taiwanese banking sector are subject to restructuring under the government initiative "Interbank Debt Restructuring Programme", compared to less than 10 per cent of Hsinchu's unsecured consumer receivables which have elected to enter the scheme.

DETAILS OF THE ACQUISITION

On 29 September 2006, Standard Chartered launched a recommended tender offer for 100 per cent of the issued and to be issued share capital of Hsinchu. The tender offer price of NTD24.50 per share values Hsinchu's entire issued share capital at USD1.2 billion (GBP0.65 billion) on a fully diluted basis. The recommended tender offer, which is subject to a minimum acceptance condition of 51 per cent and satisfaction of remaining regulatory consents, is expected to be completed in November 2006. The tender offer price will be payable by Standard Chartered within five business days after the closing of the tender offer.

Hsinchu's board of directors has recommended shareholders to accept Standard Chartered's tender offer. In addition, Standard Chartered has received irrevocable undertakings to accept the tender offer from shareholders representing 23.64 per cent of Hsinchu's issued share capital (on a fully diluted basis), including a commitment from the Fubon Group of Companies of 6.79 per cent.

On 28 September 2006, Standard Chartered received regulatory approval from the Financial Supervisory Commission in Taiwan to acquire 51 to 100 per cent of the issued share capital of Hsinchu. In addition, the Fair Trade Commission has granted a waiver from the requirement to obtain the Commission's approval for the tender offer. The material outstanding regulatory approval is the approval for foreign investment from the Investment Commission of the Ministry of Economic Affairs.

• 3 -

---

LETTER FROM THE BOARD

It is the intention of Standard Chartered to delist Hsinchu, subject to regulatory consent and Hsinchu shareholder approval, and to acquire 100 per cent of the issued and to be issued share capital of Hsinchu. Standard Chartered intends to combine its existing Taiwanese operations with Hsinchu by late 2007.

To the best of the knowledge, information and belief of Standard Chartered's Directors, having made all reasonable enquiry, Hsinchu's shareholders are third parties, independent of Standard Chartered and connected persons or related parties of Standard Chartered.

ACQUISITION RATIONALE AND BENEFITS

Hsinchu represents an attractive opportunity for Standard Chartered:

• The Taiwanese economy is the fifth largest in Asia and continues to demonstrate good growth with forecast average annual real GDP growth of 4.3 per cent² between 2007 and 2010. This growth is underpinned by increasing trade flows, especially with mainland China and the rest of Asia (total Taiwanese exports increased by 57 per cent from 2001 to 2005, with export growth accelerating from 8 per cent in 2005 to 14 per cent in the first seven months of 2006). Taiwan also has one of the largest and highest growth technology sectors in the world and a young and increasingly affluent population, particularly in the Taoyuan and Hsinchu regions where Hsinchu has a leading market position.

• The Taiwanese banking revenue pool is the fourth largest in Asia with an estimated size in 2005 of USD29 billion. Hsinchu provides Standard Chartered with an opportunity for significant income and earnings growth in both Consumer and Wholesale Banking in Taiwan through the introduction of its sales practices and innovative products and by leveraging its international network, particularly in the North East Asia region.

• The acquisition will transform Standard Chartered's existing market position in Taiwan and further diversify Standard Chartered's earnings base. Together with Standard Chartered's existing business, the acquisition of Hsinchu would have made Taiwan Standard Chartered's fourth largest market by income for the six months ended 30 June 2006.

• Hsinchu has an impressive track record of growth driven by a strong local management team. The combination of Standard Chartered's existing business and Hsinchu will provide an excellent platform for expansion across Taiwan.

Standard Chartered will look to further grow Hsinchu's income and profits significantly in ways that will include:

Consumer Banking

• Using Standard Chartered's customer segmentation methodology to enable further penetration and cross-selling of more profitable products to the affluent customer segments.

• Using Standard Chartered's network management skills and processes to expand and enhance distribution through branch reconfiguration and relocation to the extent permissible under Taiwanese law, increased productivity and efficiency, and by developing an effective direct sales channel. Through the implementation of these skills and processes, Standard Chartered aims to significantly increase Hsinchu's deposits per branch from the current NTD4 billion towards the NTD12 billion reported by the top three banks in Taiwan.

• Using Standard Chartered's skills and experience, together with its performance-driven management model, to drive product and service development.

Standard Chartered estimates

---

LETTER FROM THE BOARD

• Implementing a broader suite of wealth management and bancassurance products and accelerating SME, credit card and mortgage strategies through product and service innovation. Standard Chartered's objective is to significantly grow the contribution of wealth management income. Wealth management contributed less than 15 per cent of Hsinchu's Consumer Banking income in 2005 and Standard Chartered will grow this towards the Group's average of over 30 per cent.
• Sharing best practice techniques in customer service, credit scoring and risk management.

Wholesale Banking

• Leveraging Standard Chartered's international network and relationship management expertise together with Taiwan's and Hsinchu's links with Hong Kong and mainland China (over 70 per cent of Hsinchu's corporate customers have operations in mainland China), to grow the client base in the global corporate and local corporate segments, and to improve Hsinchu's cross-selling capability.
• Building on Standard Chartered's international product expertise to realise opportunities in trade finance, global markets and regional cash management for Hsinchu's domestic corporate clients and for Standard Chartered's international clients.
• Leveraging Hsinchu's network and infrastructure to enhance services for global corporates.
• Reinvigorating the product and service offering to the local corporate segment and deepening relationships with companies from Hsinchu's technology sector.
• Growing fee-income products in global markets, such as foreign exchange, derivatives and structured finance, and capturing cross border trade flows.

Other

• Achieving incremental cost efficiencies, as Standard Chartered combines its existing business with Hsinchu. Standard Chartered anticipates that pre-tax cost synergies will amount to approximately USD20 million per year. This will be achieved through removing duplication in the two entities. Standard Chartered does not plan to reduce headcount, and will redeploy resources to support rapid growth in the business with controlled cost growth.
• Benefiting from reduced funding costs, as a result of Standard Chartered's stronger credit rating and broader access to funding.

STANDARD CHARTERED IN TAIWAN

Standard Chartered's presence in Taiwan was established in 1985. It operates today through three branches and has over 900 employees. As at 30 June 2006, it had assets of approximately USD3 billion. Standard Chartered has both Consumer and Wholesale Banking businesses in Taiwan.

FINANCIAL IMPACT OF THE ACQUISITION

On 29 September 2006, Standard Chartered Bank launched a recommended tender offer for Hsinchu's entire issued and to be issued share capital at NTD24.50 in cash per Hsinchu share. This values Hsinchu's entire issued share capital at USD1.2 billion, or GBP0.65 billion, on a fully diluted basis representing a premium of 40 per cent to Hsinchu's closing share price of NTD17.45 on 28 September 2006; 12.7 times Hsinchu's reported after tax earnings in 2005 and 2.3 times Hsinchu's reported net asset value as at 30 June 2006.

Standard Chartered prepares its financial statements in accordance with International Financial Reporting Standards as adopted by the EU (IFRS). Following completion of the transaction, Standard Chartered will make certain IFRS and fair value adjustments in respect of the Hsinchu balance sheet that will be included in Standard Chartered's

---

LETTER FROM THE BOARD

consolidated financial statements. In particular, in respect of the consumer loan portfolio, Standard Chartered estimates that were it to apply its IFRS policies and fair value adjustments as at 30 June 2006, the impact would be to reduce Hsinchu's tangible net assets by approximately USD100 million. However, the effect of the acquisition will be to increase the net assets of Standard Chartered based on the unaudited net assets of Hsinchu as at 30 June 2006.

Standard Chartered will finance the acquisition of Hsinchu with the proceeds of an institutional placing of new ordinary shares of USD0.50 each to raise approximately USD1.2 billion (GBP0.65 billion) (the "Placing"). Assuming that the acquisition of 100 per cent of the fully diluted share capital of Hsinchu and that the Placing had completed at 30 June 2006 and including the impact of the recently announced acquisition of Union Bank Limited of Pakistan and the increase in Standard Chartered's stake in PT Bank Permata Tbk, Standard Chartered's tier 1 ratio would have been in the range of 7.5 per cent to 7.7 per cent and its core equity ratio would have been in the range of 5.7 per cent to 5.9 per cent.

Based on Standard Chartered's forecasts for business growth and transaction benefits, the acquisition is expected to be earnings accretive and achieve double digit ROI in the full year ending 31 December 2008.

The Directors of Standard Chartered consider the terms of the acquisition to be fair and reasonable and that the transaction is in the interests of the Standard Chartered Group and its shareholders as a whole.

Funding

The consideration for the acquisition will be met out of the proceeds of an institutional placing of new Standard Chartered ordinary shares representing approximately $3.646\%$ of Standard Chartered's issued ordinary share capital prior to the Placing and $3.517\%$ of Standard Chartered's enlarged issued ordinary share capital immediately after the Placing. The placing of 48,500,000 new Standard Chartered ordinary shares ("Placing Shares") at a price of 1375 pence per Placing Share was completed and the Placing Shares issued on 4 October 2006. The Placing raised net proceeds of approximately USD1.2 billion (approximately GBP0.65 billion). Pursuant to applications made by Standard Chartered, the Placing Shares were admitted by the UK Listing Authority to its Official List and by the London Stock Exchange to trading on the London Stock Exchange's market for listed securities on 4 October 2006 and the Hong Kong Stock Exchange approved the listing of and granted permission to deal in the Placing Shares on the Hong Kong Stock Exchange on 6 October 2006. Dealings in the Placing Shares commenced in London on 4 October 2006 and in Hong Kong on 10 October 2006. The Placing Shares were credited as fully paid and rank pari passu in all respects with the existing ordinary shares of USD0.50 each in the capital of Standard Chartered including the right to receive all dividends and other distributions declared, made or paid after 4 October 2006 save they will not rank for the interim dividend of USD0.2083 per share in respect of the six months ended 30 June 2006 declared on 8 August 2006 and paid on 11 October 2006. All the Placing Shares were issued in uncertificated form.

The Placing Shares were issued under the general mandate granted by the Company's shareholders on 4 May 2006.

CURRENT TRADING

Overall, the Group's progress during the second half of 2006, including the credit outlook in Taiwan, continues to be in line with the guidance given at the Interim Results Presentation on 8 August 2006.

For the Group, the guidance stated that "the outlook is positive, and we expect continued good income momentum. We will maintain our focus on expense management and expense growth should be broadly in line with income growth for the full year. We will continue to take a balanced approach to risk, whilst recognising the changes in the external environment". For Taiwan the guidance stated "recent indications are that conditions continue to improve and it is expected that there will be a sharp reduction in the loan impairment charge in Taiwan in the second half of the year. However, given recent and prospective regulatory changes, there remains considerable uncertainty about the evolution of the consumer credit market".

---

LETTER FROM THE BOARD

BUSINESS DESCRIPTION

Standard Chartered PLC is listed on both the London Stock Exchange and the Hong Kong Stock Exchange and is consistently ranked in the top 25 among FTSE-100 companies by market capitalisation.

Standard Chartered has a history of over 150 years in banking and operates in many of the world's fastest-growing markets with an extensive global network of over 1,200 branches (including subsidiaries, associates and joint ventures) in over 50 countries in the Asia Pacific Region, South Asia, the Middle East, Africa, the United Kingdom and the Americas.

As one of the world's most international banks, Standard Chartered employs almost 50,000 people, representing over 90 nationalities, worldwide. This diversity lies at the heart of the Bank's values and supports the Bank's growth as the world increasingly becomes one market.

Standard Chartered derives over 90 per cent of profits from Asia, Africa and the Middle East.

CONCLUSION

The Directors consider the terms of the acquisition to be fair and reasonable and in the interests of the Company and its shareholders as a whole.

ADDITIONAL INFORMATION

Your attention is drawn to the additional information set out in the appendix to this circular.

Yours sincerely

On behalf of the Board
Bryan K Sanderson CBE
Chairman

As at the date of this circular, the Board of Directors of the Company comprises:

Executive Directors:
Mr Bryan Kaye Sanderson, CBE; Mr Evan Mervyn Davies, CBE; Mr Michael Bernard DeNoma; Mr Richard Henry Meddings; Mr Kaikhushru Shiavax Nargolwala; Mr Peter Alexander Sands; and

Independent Non-Executive Directors:
Mr Hugh Edward Norton; Sir C K Chow; Mr James Frederick Trevor Dundas; Ms Valerie Frances Gooding, CBE; Mr Rudolph Harold Peter Markham; Ms Ruth Markland; Mr Paul David Skinner; Mr Oliver Henry James Stocken; and Lord Adair Turner.

Standard Chartered PLC
1 Aldermanbury Square
London EC2V 7SB
Registered Office as above
Registered in England 966425

The following exchange ratios have been used in this circular:

USD1: NTD32.9
USD1: GBP0.53

---

APPENDIX

GENERAL INFORMATION

A. RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Hong Kong Listing Rules and the UK Listing Rules for the purpose of giving information with regard to the Company and the acquisition disclosed above. The Directors, whose names appear on page 7 of this circular, collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief there are no other facts the omission of which would make any statement herein misleading.

B. DISCLOSURE OF INTERESTS

The Company and its Directors, chief executives and shareholders have been granted a partial exemption from the disclosure requirements under Part XV of the Securities and Futures Ordinance (Cap.571 of the Laws of Hong Kong) ("SFO"). As a result of this exemption, Directors, chief executives and shareholders no longer have an obligation under the SFO to notify the Company of shareholding interests, and the Company is no longer required to maintain a register of Directors' and chief executives' interests under section 352 of the SFO nor a register of interests of substantial shareholders under section 336 of the SFO. The Company is, however, required to file with the Hong Kong Stock Exchange any disclosure of interests made in the UK. In addition, the Company has adopted a code of conduct regarding securities transactions by Directors in accordance with the UK and Hong Kong Listing Rules. As at 13 October 2006, which was the latest practicable date before publication of this circular (the "Latest Practicable Date"), the Directors, chief executives and substantial shareholders of the Company held the following interests based on the disclosure of interests made in the UK:

(i) Directors' Interests in Shares and Options

	Total interest in ordinary shares	Total interest in ordinary shares under option	Range of option exercise prices	Range of option exercise periods
B K Sanderson	233,275	303,902	Nil - 971p	2006 - 2015
E M Davies	200,419	1,476,283	Nil - 971p	2006 - 2016
Sir C K Chow	15,664	-	n/a	n/a
M B DeNoma	159,343	388,351	Nil - 971p	2007 - 2016
J F T Dundas	2,100	-	n/a	n/a
V F Gooding	2,049	-	n/a	n/a
R H P Markham	2,364	-	n/a	n/a
R Markland	2,139	-	n/a	n/a
R H Meddings	109,852	363,207	Nil - 1064p	2006 - 2016
K S Nargolwala	147,340	450,746	Nil - 971p	2006 - 2016
H E Norton	7,500	-	n/a	n/a
P A Sands	30,641	968,194	Nil - 971p	2006 - 2016
P D Skinner	3,206	-	n/a	n/a
O H J Stocken	10,000	-	n/a	n/a
Lord Turner	2,016	-	n/a	n/a

---

APPENDIX

GENERAL INFORMATION

(ii) Substantial Shareholders’ Interests in Shares

As far as the Directors are aware, Temasek Holdings (Private) Limited is the only shareholder as at the Latest Practicable Date with an interest of more than 10% in the Company’s issued ordinary share capital carrying rights to vote at any general meeting of the Company.

As at the Latest Practicable Date, the Company had recorded in its register of interests the following interests of 3% or more in its issued ordinary share capital:

Shareholder	Number of ordinary shares	Percentage of issued ordinary share capital
Temasek Holdings (Private) Limited	153,365,936	11.08%
Goodwood Park Hotel Limited*	153,365,936	11.08%
The estate of Tan Sri Khoo Teck Puat*	153,365,936	11.08%
Glen Holdings (Private) Limited**	153,365,936	11.08%
Fidelity Investments	92,628,893	6.69%
Legal & General Investment Management Limited	53,103,702	3.84%

• Temasek Holdings (Private) Limited owns 11.08% of the Company’s share capital. As a result of a sale and purchase agreement between Dover Investments Pte Ltd, a wholly owned subsidiary of Temasek Holdings (Private) Limited, and Goodwood Park Hotel Limited, the estate of Tan Sri Khoo Teck Puat and Glen Holdings (Private) Limited, Goodwood Park Hotel Limited, the estate of Tan Sri Khoo Teck Puat and Glen Holdings (Private) Limited are interested by attribution only (under technical UK Companies Act 1985 provisions) in the 11.08% of the Company’s shares owned by Temasek Holdings (Private) Limited until 20 January 2007.
  a Glen Holdings (Private) Limited is a wholly owned subsidiary of Goodwood Park Hotel Limited.

C. SERVICE CONTRACTS

All of the Group Executive Directors, are entitled to receive and required to give, 12 months’ notice. Each contract is subject to 12 months’ rolling notice but, in any event, terminates automatically at the first annual general meeting following the executive director’s 60th birthday. The contracts contain payment in lieu of notice (PILON) provisions which can be exercised at Standard Chartered Bank’s discretion. The PILON would comprise an amount equal to 12 months’ base salary, pension contributions/ entitlement and certain benefits and allowances (such as life assurance and car allowance). The amount of any bonus payable as part of the PILON is determined taking into consideration individual and Group performance. Any payment under the PILON would be paid in quarterly instalments and be subject to mitigation.

The Company’s Chairman, Mr B K Sanderson has a 12 month rolling contract which in any event expires on 14 October 2008. His contract contains clauses specifying payments in the event of early termination by Standard Chartered Bank. In such circumstances the contract provides for payment that would take account of his base salary and certain allowances but exclude non-cash benefits and performance related bonus for the relevant period of notice.

---

APPENDIX

GENERAL INFORMATION

The Independent Non-executive Directors do not have service contracts.

D. DIRECTORS' COMPETING INTERESTS

None of the Directors or their respective associates had, as at the Latest Practicable Date, any interest in a business which competes, or is likely to compete, either directly or indirectly, with the business of the Company and its subsidiaries as required to be disclosed pursuant to the Hong Kong Listing Rules.

E. LITIGATION

As at the Latest Practicable Date, neither the Company nor any of its subsidiaries are aware of any litigation, arbitration or claim, current, pending or threatened, that they are engaged in and that may have a material effect on the financial position or profitability of the Company and its subsidiaries.

F. GENERAL

(i) The secretary of the Company is Julie Bamford, a Chartered Secretary and a Fellow of the Institute of Chartered Secretaries and Administrators.

(ii) The qualified accountant of the Company for the purpose of Rule 3.24 of the Hong Kong Listing Rules is Simon Jeremy Glass, an Associate of the Institute of Chartered Accountants in England and Wales.

(iii) The branch share registrar and transfer office of the Company in Hong Kong is Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong.

(iv) Chinese Translation

If you would like a Chinese version of this circular please contact: Computershare Hong Kong Investor Services Limited at 46th Floor, Hopewell Centre, 183 Queen's Road East, Hong Kong.

通函之中文譯本可向香港中央證券登記有限公司索取，地址為香港皇后大道東183號合和中心46樓。

(v) In the event of any inconsistency between the English text and the Chinese text of this circular, the English version shall prevail.

© Standard Chartered PLC

October 2006

Registered Office: 1 Aldermanbury Square, London EC2V 7SB

Telephone: +44(0) 20 7280 7500. www.standardchartered.com

Principal Place of Business in Hong Kong: 32nd Floor, 4-4A Des Voeux Road Central, Hong Kong

Registered in England Number: 966425