11:07     TAI FOOK SEC<00665> - Announcement (1)                              

    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.                                                             
                                                                              
    TAI FOOK SECURITIES GROUP LIMITED                                         
    (Incorporated in Bermuda with limited liability)                          
    (Stock Code: 00665)                                                       
    CONTINUING CONNECTED TRANSACTIONS                                         
                                                                              
    On 1 April 2005, the following two master agreements have been            
    entered into for a fixed term commencing from 1 April 2005 up             
    to 31 December 2007:                                                      
                                                                              
    (i)     the master agreement between the Company on the one hand,         
    and CTFE on the other hand; and                                           
                                                                              
    (ii)    the master agreement between the Company on the one hand,         
    and Mr. Lo on the other hand.                                             
                                                                              
    In view of the business nature of the Group, the Directors                
    consider that the entering into of the respective Master                  
    Agreements are in the interests of the Group and the Independent          
    Shareholders as a whole.                                                  
                                                                              
    Each of the Master Agreements and the transactions contemplated           
    thereunder constitute continuing connected transactions for the           
    purpose of the Listing Rules. Since the applicable percentage             
    ratios in respect of the Master Agreements, on an annual basis,           
    exceed 2.5%, both of the Master Agreements are subject to the             
    reporting, announcement and annual review requirements and the            
    approval by the Independent Shareholders by poll at the SGM under         
    the Listing Rules.                                                        
                                                                              
    A circular containing, among other things, the details of the             
    terms of the Master Agreements and the transactions contemplated          
    thereunder, a letter of recommendation from the Independent               
    Board Committee to the Independent Shareholders, a letter of              
    advice by the independent financial adviser to the Independent            
    Board Committee and the Independent Shareholders, and a notice            
    of the SGM will be despatched to the Shareholders as soon as              
    practicable in accordance with the requirements of the Listing            
    Rules.                                                                    
                                                                              
                                                                              
    BACKGROUND                                                                
                                                                              
    At the time of listing of the Company on the Stock Exchange,              
    the Company had applied for, and the Stock Exchange had granted           
    on 6 August 1996, the Waiver from compliance with the connected           
    transactions requirements of the then Listing Rules in respect            
    of certain continuing connected transactions for an indefinite            
    period (the details of which were disclosed in the Company's              
    prospectus dated 23 July 1996). In view of the changes to the             
    Listing Rules in relation to continuing connected transactions            
    which took effect on 31 March 2004, the Group has entered into            
    the Master Agreements.                                                    
                                                                              
    MASTER AGREEMENTS                                                         
                                                                              
    Background and nature of the transactions                                 
                                                                              
    Apart from providing financial advisory services to and acting            
    as placing agent, underwriter and/or sub-underwriter for                  
    independent clients, the Group, from time to time, has provided           
    financial advisory services to and act as placing agent,                  
    underwriter and/or sub-underwriter for the Connected Clients.             
    In compliance with the revised Listing Rules in relation to               
    continuing connected transactions, the Company has entered into           
    two