1. 1 Our Mission n Understanding the business environment for foreign banks in China/Shanghai n Market strategy of Deutsche Bank n Market strategies of other foreign banks n Regulatory framework and impact on market entry n Outlook for Shanghai vis-à-vis other Financial Centres Foreign Banks in China Critical Success Factors and Lessons Learnt Masayoshi Odaka Arati Varma Prof. Ramin Cooper Maysami Susann Naomi Israel Gabriel Rüeck

2. 2 Meetings n Bank of America: Shawn Xue (Treasurer) n Bank of Communications: Dr. Zhou Kunping (Deputy Manager) n DBS Bank: Choy Mun Loong (Senior Manager) Sam Yang (Account Manager) Chi Ho Ng (MBA Internship) n Deutsche Bank SGP: Frank Hamer (General Manager) Ned Perry (Head of Legal & Compliance Asia) n Dresdner Bank: Dr. Hans J. Schniewind (General Manager) n gic AHK DIHK: Holger Morneweg (Representative) Foreign Banks in China Critical Success Factors and Lessons Learnt

3. 3 Our Conclusions: Banking Business in Shanghai n Limited scope for foreign banks n Legal framework is still immature n Relationships play an important role n Primary reliance on servicing foreign companies n No short-term profits n Qualified and motivated staff at affordable costs n Risk management still to be improved n E-banking is growing and important Foreign Banks in China Critical Success Factors and Lessons Learnt

4. 4 Our Conclusions: Market Entry Strategies of Foreign Banks n Foreign enterprises are the initial customer base n Strategy matches strengths, no uniform strategy among banks n RMB license is important (competitive advantage) n Partnership, alliance and shareholding questionable n Early market entry is important n Premium products at a premium price n Focus on niche markets Foreign Banks in China Critical Success Factors and Lessons Learnt

5. 5 Our Conclusions: Regulations n Regulation changes are unpredictable and frequent n Access to rules difficult n Little transparency n High costs for licensing products n Exchange rate control and interest control limit business n Not yet up to Singapore or Hong Kong standards Foreign Banks in China Critical Success Factors and Lessons Learnt