10:07     INTL BK OF ASIA<00636> - Announcement (5)                           

    4.      AGGREGATE ANNUAL FEE CAP                                          
                                                                              
    The fees payable by (a) the Company and IBA Credit to members             
    of the Fubon Group and (b) Taipei Fubon to the Company, under             
    the Business Co-operation Agreements will vary depending on the           
    number and nature of the Services provided by the relevant                
    parties. However, each Business Co-operation Agreement contains           
    a clause whereby the parties agree that the maximum aggregate             
    annual fees (the "Annual Cap") payable by (a) the Company and             
    IBA Credit to members of the Fubon Group and (b) Taipei Fubon             
    to the Company, under the Business Co-operation Agreements                
    (taken together) will not exceed an annual aggregate amount of            
    HK$10,000,000.                                                            
                                                                              
    If the Annual Cap of HK$10,000,000 were to be exceeded, the               
    thresholds set out in Rules 14A.34(2) of the Listing Rules would          
    be breached (as set out in Section 3 above). Therefore, the               
    parties to the Business Co-operation Agreements have agreed that          
    the Annual Cap will not be exceeded without the approval of the           
    independent shareholders of the Company first being sought. Any           
    shareholder of the Company with a material interest in the                
    Business Co-operation Agreements (and its associates) will be             
    required to abstain from voting on any resolution to approve              
    the Business Co-operation Agreements.                                     
                                                                              
    Further, as provided in the Listing Rules, should the Annual              
    Cap be exceeded the Company will comply with the requirements             
    under Rule 14A.36 of the Listing Rules.                                   
                                                                              
    The Annual Cap has been determined by reference to the projected          
    annual level of Services to be entered into under the Business            
    Co-operation Agreements in the next three financial years. As             
    the parties have not entered into similar arrangements                    
    previously, no reliable historical data exists on which to base           
    such projections.                                                         
                                                                              
    Therefore, the projected amounts were determined on the basis             
    of a reasonable estimate by the parties of the level of Services          
    to be provided by (a) the Fubon Group to the Company and IBA              
    Credit and (b) the Company to Taipei Fubon, with the Company              
    having taken into account the business development objectives             
    reflected in the Company's 2005 financial budget which was                
    formally approved by the Board of Directors of the Company on             
    7 December 2004. Further, in determining the reasonableness of            
    the projected amounts the Company has made direct reference to            
    the net profit of the Company for the six-month period ended              
    30 June 2004 as stated in the Company's published 2004 interim            
    report. Also taken into consideration was (A) the Fubon Group's           
    knowledge of the past demand for financial services in Hong Kong          
    of the Fubon Group's customers, (B) the size and nature of the            
    Fubon Group's customer base with known business interests in              
    Hong Kong, (C) the Company's knowledge of the past demand for             
    financial services in Taiwan of the Company's customers, and              
    (D) the size and nature of the Company's customer base with known         
    business interests in Taiwan.                                             
                                                                              
    The projections were also made on the principal underlying                
    assumptions that, for the duration of the projected period, (i)           
    the business of the Company and IBA Credit and the Fubon Group            
    remains consistent with previous patterns, (ii) there will not            
    be any adverse change or disruption in market conditions,                 
    operation and business environment or government policies which           
    materially affect the business of the Company, IBA Credit or              
    the Fubon Group, and (iii) the industries in which the Company,           
    IBA Credit and the Fubon Group operate remain stable.                     
                                                                              
    5.      PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY, IBA CREDIT AND      
    THE FUBON GROUP