Major Shareholder:

• Tan Sri Khoo Teck Puat ¡V 13.51% interest

The Company is the ultimate holding company of Standard Chartered Bank, a leading international banking and financial services company particularly focused on the markets of Asia Pacific, the Middle East and South Asia and Africa. The Company has no significant operations or assets other than its 100% interest in Standard Chartered Bank. The Group is headquartered in the United Kingdom, and has a network of over 500 branches and offices in more than 50 countries and about 28,100 employees. The Asia Pacific region is currently Standard Chartered¡¦s largest region, and Hong Kong is its largest single market.

Standard Chartered operates two business divisions: Consumer Banking and Wholesale Banking. Consumer Banking offers banking services, deposit taking services, credit cards, personal loans, mortgages, auto finance and wealth management services to individuals and small and medium-sized businesses in a number of Standard Chartered¡¦s markets. Wholesale Banking provides debt capital markets, treasury, advisory services and structured trade services, cash management and custody services, as well as more traditional lending and trade finance services, to a wide range of corporate and institutional clients.

Standard Chartered was created from the merger in 1969 of The Chartered Bank and The Standard Bank Limited. Both banks were established in the mid-nineteenth century and their origins lie in financing trade in the emerging markets of Asia and Africa. Standard Chartered has a long history in these markets. The Chartered Bank opened its first branch in Hong Kong in 1859 and was given a license to issue Hong Kong bank notes in 1862.

Shares of the company have been admitted to the Official List and have been traded on the London Stock Exchange since 30th January. 1970, and the Company is a long established member of the FTSE 100 index.

The Directors believe that the Group has the following competitive advantages:

• Standard Chartered is an international bank with a strong brand in the markets of Asia, the Middle East and Africa. Standard Chartered offers customers and potential customers the products services, reliability and transparency of a leading international bank through an extensive local distribution network;

• The markets in which Standard Chartered operates in general represent fast growing markets for banking services, and offer significant opportunities for banks to provide a range of basic and sophisticated banking products and services to the growing affluent populations in these markets. Standard Chartered believes it is positioned to grow with these markets;

• Standard Chartered has the scale to become a low cost provider, including in its credit cards and wealth management businesses. It also has scale in terms of distribution outlets, customer base and market share;

• Standard Chartered has demonstrated its ability to manage effectively the credit quality of its assets during periods of difficult economic conditions such as the Asian economic crises of 1997 to 1999; and

• Standard Chartered has an experienced management team. Many of its senior team, including two Group executive Directors, are located in Asia, close to its key markets and customers.

• Standard Chartered operates in many emerging markets, and these operations expose it to risks that could adversely affect its financial condition and results of operations.
• Standard Chartered is facing significant competition, which may have an adverse effect on its financial condition and results of operations.
• Standard Chartered is operating in a highly regulated industry and bank regulatory restrictions and other laws and regulations could impair its operations.
• Standard Chartered is expanding its operations and this growth might represent a risk if not managed effectively.

Building market share in Consumer Banking Standard Chartered believes that there is significant growth potential in Consumer Banking products in the markets in which it operates. It is seeking to increase market share by offering innovative products through its wide branch distribution network. This is particularly true of its credit cards and wealth management businesses, with mortgages also providing attractive opportunities.

Repositioning the Wholesale Banking business to increase returns Standard Chartered is actively seeking to increase returns from Wholesale Banking by increasing cross selling of products, which provide higher returns. These products include Global Markets (including debt capital markets and treasury) and cash management products. Standard Chartered intends to direct both capital and investment resources in the Wholesale Banking business to these products and is also capping the overall amount of economic capital in Wholesale Banking.

Driving cost efficiency in technology and operations Standard Chartered has made good progress with its efficiency programme, which was ahead of target at the end of 2001. As a result, the original targets for the programme have been revised upwards. Performance was in line with these revised targets during the first half of 2002.

Controlling risk Standard Chartered is enhancing its control of risk. It has reviewed its customer portfolio to identify areas of high risk. It has also taken action to address the problem caused by the significant increase in personal bankruptcies in Hong Kong, including tightening its loan approval criteria and developing early warning trigger mechanisms. Standard Chartered is reviewing its Latin American operations, which have suffered significant bad debt problems. It has strengthened its market and operational risk teams.

The net proceeds of the Share Offer (after deduction of underwriting fees and estimated expenses payable by the Company in relation to the Share Offer, assuming the Over-allotment Option is not exercised and assuming a price of HK$79.30 per Share, being the Hong Kong dollar equivalent of the closing price of the Shares on the London Stock Exchange on the Latest Practicable Date), are estimated to be approximately HK$2,268 million (U.S.$291 million) (or if the Over-allotment Option is exercised in full, are estimated to be approximately HK$2,619 million (U.S.$336 million)).

The net proceeds from the Share Offer will be used to support ongoing growth of the Group and may be applied in active capital management, which could include repurchases of capital related securities.