REPLY OF THE CHINA BANKING REGULATORY COMMISSION CONCERNING LAUNCHING THE BUSINESS OF INTER-BANK ENTRUSTED LOANS AMONG FINANCIAL INSTITUTIONS BY THE AGRICULTURAL DEVELOPMENT BANK OF CHINA

Reply of the China Banking Regulatory Commission concerning Launching the Business of Inter-bank Entrusted Loans among Financial Institutions
by the Agricultural Development Bank of China

Agricultural Development Bank of China:

The Request for Letters on Launching the Business of Inter-bank Entrusted Loans by the Agricultural Development Bank of China (Nong
Fa Yin Fa [2005] No. 333) has been received. Upon consideration, a reply hereby is given as follows:

1.

You are granted to launch the business of inter-bank entrusted loans among financial institutions. You should not undertake any relevant
credit risk for the trustor or do so in a disguised form for the purpose of launching this business.

2.

The scope of trustors for you to launch the business of inter-bank entrusted loans among financial institutions shall be restricted
to policy banks, commercial banks and rural credit cooperative institutions. You must catty out the report system to extend entrusted
loans to the enterprises that have opened accounts, and you shall, within 10 days as of the said business is launched, make a report
to this Commission. The entrusted loans business shall be restricted to providing financial services for the field of “three problems
of agriculture”.

3.

You shall intensify the management of this business, set up and improve internal control system and operational procedures, and report
related risks and problems faced in implementation of this business to this Commission in a timely manner.

The China Banking Regulatory Commission

June 21, 2006