XN000022-1991-08-01 — Page 2

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THURSDAY, AUGUST 1, 1991

STATEMENT BY PROVISIONAL LIQUIDATOR TO CREDITORS AND OTHERS INTERESTED IN BANK OF CREDIT AND COMMERCE HONG KONG LIMITED ("BCCHK"} (IN PROVISIONAL LIQUIDATION)

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1991

AND ENABLE THE SUBSTANTIAL UK DEPOSIT

THE HIGH COURT IN LONDON HAS ADJOURNED UNTIL 2ND DECEMBER THE BANK OF ENGLAND'S PETITION TO WIND UP THE BANK OF CREDIT COMMERCE INTERNATIONAL SA. THE ADJOURNMENT WAS GRANTED TO MAJORITY SHAREHOLDER, THE RULER OF ABU DHABI, TO MAKE A CASH LOAN, TO BE RECOVERED AT A LATER DATE EITHER FROM THE PROTECTION BOARD IF A WINDING-UP ORDER IS EVENTUALLY MADE OR FROM A RESTRUCTURED BCCI IF A WINDING-UP ORDER IS NOT MADE, TO ENABLE AN EARLY PAYMENT TO BE MADE TO SMALL DEPOSITORS.

THIS RECENT DEVELOPMENT REGARDING BCCI IN THE UNITED KINGDOM ALTHOUGH NO MORE THAN A LOAN ARRANGEMENT, MAY BE AN INDICATION THAT THE MAJORITY SHAREHOLDER STILL RETAINS AT LEAST SOME INTEREST IN THE BCC GROUP OF COMPANIES. IT MAY JUST BE, THEREFORE, THAT IF A WORKABLE SCHEME FOR TAKING OVER OR RESTRUCTURING BCCHK COULD BE PUT TOGETHER IN HONG KONG THE MAJORITY SHAREHOLDER MIGHT, AND I PUT IT NO FURTHER THAN THAT, BE PREPARED TO GIVE SUPPORT BY WAY OF A GUARANTEE AGAINST UNRECORDED LIABILITIES OR IN SOME OTHER FORM THAT WOULD FACILITATE THE CONTINUATION OF ITS BANKING BUSINESS LOCALLY.

I MUST EMPHASISE, HOWEVER, THAT NO CLEAR INDICATION EXISTS AT PRESENT THAT ASSISTANCE IN ANY FORM WILL BE FORTHCOMING FOR BCCHK FROM THE MAJORITY SHAREHOLDER AND THAT THE DIFFICULTIES IN PUTTING A WORKABLE PROPOSAL TOGETHER SHOULD NOT BE UNDERESTIMATED.

THE ACCOUNTS OF BCCHK, AUDITED BY MESSRS PRICE WATERHOUSE, FOR THE YEAR ENDED 31ST DECEMBER 1990 SHOW THAT AS AT THAT DATE THE BANK HAD GROSS ASSETS OF $13.9 BILLION, INCLUDING LOANS AND ADVANCES TO CUSTOMERS OF $6.7 BILLION, DEPOSIT LIABILITIES OF $12.7 BILLION, OTHER LIABILITIES OF $0.7 BILLION AND NET SHAREHOLDERS' EQUITY OF $0.5 BILLION.

BASED ON THE UNAUDITED ACCOUNTS OF THE BANK AS AT 30TH JUNE 1991 PREPARED BY THE BANK'S OWN MANAGEMENT ("THE MANAGEMENT ACCOUNTS"} THERE DOES NOT APPEAR ΤΟ THE SPECIAL MANAGERS TO HAVE BEEN ANY MATERIAL DETERIORATION IN THE FINANCIAL POSITION OF THE BANK SINCE THAT DATE.

I MUST STRESS THAT THE MANAGEMENT ACCOUNTS TO JUNE 1991 HAVE YET TO BE VERIFIED BY THE SPECIAL MANAGERS FROM KPMG PEAT MARWICK. THE SPECIAL MANAGERS HAVE BEEN WORKING AS A MATTER OF THE UTMOST PRIORITY TO ASCERTAIN THE PRECISE FINANCIAL POSITION OF BCCHK AS AT THE PRESENT TIME AND HAVE NOT YET COMPLETED THEIR WORK. UNAVOIDABLY THIS MUST BE A PAINSTAKING AND TIME-CONSUMING EXERCISE WHICH, I AM INFORMED, IS UNLIKELY TO BE CONCLUDED BEFORE ABOUT 4 TO 6 WEEKS.

/THE SPECIAL