Nordea Bank AB, Shanghai Branch 北欧银行瑞典有限公司上海分行

Nordea Bank AB, Shanghai Branch 北欧银行瑞典有限公司上海分行

Nordea in China Long history of doing business with China Beijing Representative office established 1984 Shanghai Branch in operation since 1 st of April 2008 Expert in Nordic soft loans The only Nordic bank that has signed general framework loan agreements with the major Chinese banks for Danish and Finnish soft loans Good and long-standing relationship with Chinese authorities & local banks 2

Nordea Bank AB, Shanghai Branch 15 people Foreign Currency license Focus on: Home market companies Selected Global industries Business Areas Financing Trade Finance Deposits Cash Management 3

Foreign Investment Limited inflow of foreign capital Important definitions: Total Investment Borrowing Gap & Foreign Debt Registered Capital Total Investment Borrowing Gap Registered Capital 4 Total Investment (USD) Registered Capital (minimum requirement) < 3 mil > 70% of TI > 3 mil < 4.2 mil > 2.1 mil > 4.2 mil < 10 mil > 50% of TI > 10 mil < 12.5 mil > 5 mil > 12.5 mil < 30 mil > 40% of TI > 30 mil < 36 mil > 12 mil > 36 mil > 33.3% of TI

Lending / Financing Early decisions can affect later financing needs Each financing alternative offers advantages and disadvantages A mix of alternatives are often used, for example: SAFE approval is necessary Trade Off-shore On-shore Equity Credits Borrowing Gap Fulfilled Foreign guarantees included in Borrowing Gap Advance & deferred payment ratios Borrowing Gap or Total Investment SAFE approval is necessary Foreign Invested Enterprise (FIE) 5

CNY Convertibility Restricted conversion to RMB FCY Registered Capital Settlement from Trade Foreign Debt Onshore Loan > 50,000 USD Directly to beneficiary No limitation Approval from SAFE Proof of no FCY Proof of no FCY CNY Account 6

CNY Convertibility: Cross-border Trade Settlement July 2009: Pilot Program for Cross-border Trade Settlement in RMB First steps include the following possibilities: companies may sign trade-related contracts denominated in RMB residents may pay and receive trade related RMB payments to and from non-residents non-residents may open RMB accounts in outside China in qualified countries Nordea can offer RMB accounts to Non-China-resident customers through Nordea Singapore 7

Cash Management: Accounts Corporate client Local Currency Foreign Currency (CNY) (USD, EUR etc) Non-Resident - Not inside China 1. Temporary Capital account - Not outside China 2. Offshore account - Exceptions: Pilot, HK Resident - At banks with CNY license - Not outside China 1. Capital Account 2. Current Account 3. Foreign Debt Account 4. Domestic Loan Account 5. Deposit Account 8

Cash Management: Payments Type Current item Capital item Currency Domestic Company to Company no restrictions Company to individual supporting documents needed (e.g. salary) - Main rule: CNY - Exception: Free trade zone, certain industries Cross- - Supporting documents - Approval and/or - Main rule: Foreign currency border - Trade in goods - Supporting documents - Exception: Pilot programme - Trade in services 9

Deposits in Foreign Currency For deposits < 3 MUSD: fixed maximum deposit rates by PBoC For deposits > 3 MUSD: rates can be negotiated Deposit rates for < 3 MUSD USD EUR JPY HKD Current 1.150 0.100 0.0001 1.000 7 days notice 1.375 0.375 0.005 1.250 1 month 2.250 0.750 0.0100 1.875 3 month 2.750 1.000 0.0100 2.375 6 month 2.875 1.125 0.0100 2.500 1 year 3.000 1.250 0.0100 2.625 10

Deposit and Loan rates in RMB Decided by PBoC Loan (+/- 10% discount) Deposit (maximum) Current - 0.36 3 month - 1.71 6 month 4.86 1.98 1 year 5.31 2.25 2 year 5.40 2.79 3 years 5.40 3.33 5 years 5.76 3.60 > 5 years 5.94-11

Products Offered LENDING DEPOSITS CASH MANAGEMENT Onshore Loans For Short- and Long-Term Maturities in Foreign Currencies Rules: 1) No RMB Conversion 2) Can only be used to pay beneficiaries: i) in free trade zone in China, or ii) located overseas Time & Call Deposits with Different Maturities Rules: Accounts in Foreign Currencies < 3mUSD; maximum rates decided by PBoC > 3mUSD; rates possible to negotiate bilaterally a) Capital Account b) Settlement Account c) Foreign Debt Account for off-shore financing d) Domestic Loan Account for on-shore financing Payments & Foreign Exchange a) Domestic & International Payments in Foreign Currencies b) Foreign Currency Exchange (Spot & Forward) to RMB Accounts by Local Banks TRADE FINANCE Letter of Credits in Foreign Currencies Guarantees in Foreign Currencies Cross border documentary and clean collections 12

Additionally Offers support and explanations to rules and regulations affecting transactions and bank business in China Provides China research and regulation updates when available Professional customer contacts speaking Norwegian, Danish, Finnish, Swedish, English and Chinese One Nordea team ensure customers are treated in the same way all over the world 13

Nordea Bank AB Shanghai Branch R.4806, Raffles City, 268 Xi Zang Middle Road 北欧银行瑞典有限公司上海分行上海市西藏中路 268 号来福士广场 4806 室. 200001 Tel: +86 21 6340 5111 Fax: +86 21 6340 5222 Email: shanghai@nordea.com 14