The Central Bank of China

PRESS RELEASE Release Date: July 19, 2002




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Important Measures in June, 2002

In line with the policy of liberalization and internationalization, and for further development of foreign exchange business, the Central Bank of China (CBC) took the following measures in June, 2002:

1. Lower the marginal required reserve ratio on foreign currency deposits (those made since December 8, 2000) to 0.125% form 2.5%, effective form June 28, 2002.

2. Approved Taipei Forex Inc. and Cosmos Foreign Exchange International Co., Ltd. to operate the brokerage business of inter-bank NT Interest Rate Swaps (IRS).

3. Approved the following Authorized Banks to operate derivates business:

(1) Cathay United Bank operates NTD/FCY Cross Currency Swaps business

(2) JinSun International Bank operates Foreign Currency Structured Deposits business, which is composed of Foreign Currency Deposits and Foreign Currency Options, Foreign Currency Structured Deposits business, which is composed of Foreign Currency Deposits and FCY/ FRA.

(3) Taishin International Bank operates NT Dollar Structured Deposits business, which is composed of NT Dollar Deposits and Foreign Currency options.

(4) The Standard Bank of South Africa operates NTD/FCY Options business.

(5) China Development Industrial Bank commences the business of Foreign Currency Trust Funds Earmarked for Investment in Foreign Securities.

4. .Approved Chinfon Bank to commence internet banking business involving foreign currencies.

5. Authorized 2 branches of 2 domestic banks to operate foreign exchange business. In addition, 2 non-authorized foreign exchange banks were approved to sell/buy foreign currency banknotes and traveler's checks. As of the end of June, there were 999 authorized foreign exchange banks, including 933 domestic banks and 66 foreign banks.