DBSBANK ANNUAL REPORT 198 5 Financial Calendar

1984 final dividend paid 7th May 1985 1985 interim dividend paid 5th September 1985 Financial year-end 31st December 1985 Announcement of half-year results 1985 6th August 1985 Announcement of full-year results 1985 4th March 1986 Annual General Meeting 13th May 1986 Proposed payment date of 1985 final dividend 13th May 1986 Announcement of half-year results 1986 August 1986 Announcement of full-year results 1986 March 1987

CONTENTS Chairman's Statement 3 Review of Operations 7 Financial Report 15 Economic Review 41 Corporate Directory 44 DBS Bank Offices 46 Subsidiaries and Associated Companies 48 Notice of Annual General Meeting 50 In Brief

* Adjusted for the rights issue in 1984 and shares arising from conversion. **Figure for 1985 excludes employees of Raffles City Pte Ltd, which ceased to be a subsidiary in August 1985.

Earnings and Dividends Average Shareholders' Funds Average Assets and Return Declared and Return on Shareholders' on Assets Funds excluding contra

Net Dividends Declared and Return On Average Shareholders' Return on Average Assets Retained Earnings Funds excluding contra

Chairman's Statement

he Singapore economy, in a significant increase in the after two decades of Bank's market share of Singapore continuous growth, dollar deposits. contracted in 1985. Its In August 1985, the Bank's 28th TGDP, instead of attaining real branch, at Kent Ridge, was opened. growth, actually fell by 1.8%. The With the commissioning of 18 main domestic factors that affected more Autobanks in 1985, the total the poor economic performance number of Autobanks has been consisted of oversupply in the increased to 80, making this network property market, structural the largest among commercial banks problems in shipping, shipbuilding in Singapore. and marine-related and other In January 1986, the Bank industries, and high labour and launched DBS Autophone, a operating costs. The manufacturing telephone banking service. DBS and construction sectors expe- Autolink was introduced on a pilot rienced sharp declines in activities basis as a corporate terminal service in 1985. for customers in November 1985. Against this background, the Working in cooperation with the DBS Group's after-tax earnings per other major local banks, DBS Bank share declined to 29.7 cents as participated in the scheme for compared with 45.6 cents in 1984. electronic funds transfer at point-of- Return on average shareholders' sale (EFTPOS). Under this scheme, funds was also reduced from 8.0% in all ATM card-holders of the partici- 1984 to 5.1% in 1985. Total assets pating banks can pay for their (including contra items) grew by purchases at selected outlets using 24.2% to reach S$22,058.9 million at their ATM cards. year-end. The Bank continued to play a An interim dividend of 8% less leading role in the domestic capital income tax of 40% was paid in market in 1985. It accounted for 58% September 1985. In view of the of the funds raised by Singapore- continuing adverse trends in the incorporated companies on the local operating environment, the Stock Exchange. DBS Bank was the Directors have deemed it prudent to lead manager and underwriter of the recommend a smaller second and Singapore Airlines Limited (SIA) final dividend of 6% less income tax. public share offer. This offer of 100 This will bring the total dividend for million SIA shares at S$5 per share the year to 14% as against 16% for was the largest share offer made so 1984. far in Singapore. Though the public While banking income increased issue of SIA shares was marred by by 8.0% over 1984 with useful the year-end crisis in the stock contributions from fee-and market, the confidence shown by the commission-based operations and subscribers to the shares was most from securities transactions, non- encouraging and, to all intents and banking operations drastically purposes, this public offer was a declined. Dividend income was very resounding success. Although the much reduced. Rental income activity in the Asian Dollar Bond suffered severely due to lower rents market was subdued and there were from the Bank's and the Group's only four bond issues throughout properties even though the the year, DBS Bank co-managed two occupancy rates were held close to of these issues. 1984 levels. With the expected liberalisation The Bank's total loans and in the use of Central Provident Fund advances declined by 6.6%. There balances, the Bank can look forward was an increase in non-bank to new financial services, opportu- customer deposits of 24.6% resulting nities in funds management and

3 investment consultancy activities. In programme to modernise banking anticipation, it plans to establish a operations. The manhours spent in number of unit trusts to provide staff training increased by 7% in avenues for investment by Central 1985. Training programmes Provident Fund contributors and focussed mainly on job-specific other customers. The first of these technical skills and on enhancing unit trusts, the Shenton Growth and improving the attitudes of staff Fund, was launched in June 1985. to render new and better quality The local stock market closed the customer services. year on a tumultuous note. Over- During the year, further speculation in certain counters substantial investments were made caused a crisis to be developed in in computer resources to ensure the local stock market towards the efficiency and competitiveness in latter part of the year. Many stock- the longer term. An additional brokers who were actively involved mainframe computer was purchased in futures trading were in deep to extend the capacity for data trouble. When one of the speculative processing. Computer literacy was counters collapsed, the very founda- actively promoted among staff at all tions of the Singapore stock market levels. The use of computers, were shaken. The Stock Exchange wherever practical to improve resorted to the unprecedented efficiency, was extended in all areas action of suspending trading for of operations. Through a wide range three days in December 1985. The of training programmes, bank staff four major local banks were invited enjoyed easy access not only to to support the stock market so that appropriate computer hardware but the financial structure would not also to technical guidance, hands-on suffer from a crisis of confidence. experience and software. They were also to render every The real estate subsidiary of the possible assistance so as to prevent a Group, DBS Land, achieved satis- major financial catastrophe. Long factory levels of occupancy for its hours were spent hammering out shops, warehouses, residential what has since become known as the properties, and office spaces. "lifeboat" scheme to maintain However, profit after tax for DBS confidence and to maintain the Land and its subsidiaries declined smooth functioning of the local from S$7.6 million in 1984 to S$5.5 stock market. In return for their million in 1985. During the assistance, the Stock Exchange year, the corporate structure of the agreed to admit the four banks as DBS Land Group of companies was members, to help to restore stability streamlined. A partly-owned and confidence. DBS Securities investment holding subsidiary, Singapore Pte Ltd was set up and Raffles Holdings Pte Ltd, whose commenced trading on the Stock only investment was in shares in Exchange on 19th February 1986. Raffles City Pte Ltd (RCPL) was The Bank is investing voluntarily liquidated. The shares increasingly in trained manpower, were distributed to its shareholders, electronic equipment and techno- and RCPL ceased to be a subsidiary logy. This will enhance and widen of DBS Land. the range of sophisticated services DBS Finance was able to to its customers. It continued to increase its operating profit by recruit staff to further enhance its 10.2% to reach S$23.1 million. in-house specialist skills in new and However, as in the case of the Bank, expanding areas of business and it increased its general and specific financial services, particularly in the provisions. This resulted in a lower field of computers and electronic profit after tax of S$5.3 million equipment to support the compared with S$9.7 million in

4 1984. In line with its growing scale industries, uncompetitive pro- of operations, DBS Finance, in duction costs and a difficult December 1985, increased its issued business environment in South East and paid-up capital from S$5.2 Asia. However, recent Singapore million to S$12.0 million through a Government initiatives, fiscal bonus issue. measures, tax concessions, efforts to The Insurance Corporation of improve productivity, and other Singapore maintained profits at regulatory changes should present close to the previous year's level new growth opportunities. The with S$7.3 million in after-tax property sector may continue to be profits in 1985. Lower profits from gloomy but given the limitations of general insurance business were land in Singapore, and fewer new offset by increases in investment buildings being approved for income and in life insurance construction, the current depressed business. prices and rentals should not be On 14th February 1986, Mr regarded as a permanent phase in Chua Kim Yeow relinquished his the real estate cycle. In the longer executive appointment in the Bank term, the value of properties in to become Chairman of the Post Singapore should recover. Office Savings Bank. He continues 1985 was also a demanding year as Deputy Chairman on the Bank's for the staff of the Bank. On behalf Board of Directors. We would like of the Board, I must thank our staff to thank him for his many contri- at all levels for their dedicated butions as an executive of the Bank service and hard work. during the last seven years and wish him every success in his new appointment. Other changes in the composition of the Board took place early in 1985. Messrs Lien Ying Chow and Wee Cho Yaw, who served on the Board since the inception of the Bank, and Mr Christoph von der Decken who Howe Yoon Chong served since 1983, resigned in May Chairman of the Board 1985, together with their respective 8th March 1986 alternates, Messrs Lee Hee Seng, Tan Puay Hee and Heinz Guenter Jungjohann. We would like to record our appreciation for their invaluable services and to thank all of them for their support and contributions over so many years during which the Bank achieved rapid progress. The DBS Group is in the business of providing a wide range of financial services with significant investments in real estate. Both in financial services and in real estate investments, market conditions were unfavourable in 1985. The prospects for 1986 are likely to remain adverse due to economic uncertainty, changing demands for the products of Singapore

5 The Bank sets high standards in the quality of service delivered to customers . . . A Corporate Banking Officer (centre, left) discussing a client's business requirements during a regular visit to the client's premises. Review of Operations

CORPORATE BANKING rading conditions were more difficult during 1985 and demand for loans in general slowed. DBS Bank's total loans and advances stood at S$5,202.7 Industrial Distribution of DBS Bank's Loans and Advances million as at end-1985 compared to S$5,572.7 million in 1984. (End of Period) TThe drop in total loans and advances was due partly to loan repayments and prepayments. The manufacturing sector accounted for 21.6% of the loans and advances, building and construction 20.5%, transport, storage and com- munication 11.4%, financial institutions 14.1% and general commerce 8.3%. In the manufacturing sector, the electrical and electronics industry, which provided the impetus for growth in 1984, suffered a down-turn in 1985 principally due to the sharp decline in demand for electronic products in the United States. Total loans approved by the Bank under the Small Industries Finance Scheme reached S$186.3 million as at end-1985, representing 37.1% of all loans approved under the Scheme. Loans and advances to the building and construction sector showed some growth in 1985. This was due primarily to disbursements arising from Industrial Distribution of DBS Bank's Equity Investments previous commitments. New loan commitments were reduced in 1985. (End of Period) Loan demand is expected to remain depressed in 1986. Structural adjustments were initiated by the major shipbuilding and ship-repairing groups in Singapore to rationalise operations and reduce capacity. The Bank's outstanding loans to the industry decreased. With the contraction in the economy and a marked slowdown in international trade, loans to the general commerce sector remained at 1984 levels. Efforts to improve customer service continued in 1985. DBS Autolink, an electronic banking service for corporate customers, was launched on a pilot basis. DBS Autolink provides corporate customers with immediate information on their transactions and balances as well as information on deposit and exchange rates. Initial response was favourable and this service will be made available to more customers in 1986.

CONSUMER BANKING he Bank achieved satisfactory progress in consumer banking operations in 1985. Non-bank customer S$ deposits grew by 22.7% outpacing the industry's growth rate of 2.6%, and the number of non-bank customer accounts expanded by 19.4%. TThe demand for consumer financing as a whole moderated but the bank nevertheless registered growth rates of 43.4% and 127.8% in housing and personal loans respectively. DBS Bank's 28th domestic branch, at Kent Ridge, was opened in August 1985, bringing banking services closer to staff and students at the National University of Singapore. A new loan scheme for tertiary students was launched in conjunction with the opening of the branch. The DBS Autobank network expanded by another 18 automated teller machines (ATMs). The Bank now operates 80 ATMs, the largest ATM network among the commercial banks in Singapore. With the acquisition of a S$2.5 million front-end computer, new Autobank features such as fast cash withdrawals and multiple transaction facilities are now available. The number of ATM card-holders rose substantially with active promotion of the Autobank network and services, and increasing acceptance of self- service banking by customers. As at end-December 1985, 57.7% of individual customers were ATM card-holders. Utilisation of the Bank's ATMs continued to increase, reducing demands on the counter and releasing manpower for enhancement of various customer services. During the year, preparations were made to launch DBS Autophone, a service which allows customers to perform a range of routine banking transactions through the telephone. The Autophone service was introduced in January 1986. The Bank annually sets aside substantial reserves from profits to promote long-term growth . . . regular reports help to keep shareholders and investors informed of developments in the Bank. Following a successful pilot run, DBS Bank, together with four other Singapore banks, launched in January 1986, the Network for Electronic Transfers (NETs) to provide a service enabling electronic funds transfer at point-of-sale, EFTPOS. This service is available to ATM card-holders of the five participating banks. Response to the DBS Autopay service, an extension of the Inter-bank Giro scheme introduced in 1984, has also been encouraging. Efforts to cross-sell the Bank's investment and treasury services through the branch network were intensified. To this end, training programmes were organised to equip branch officers with the skills to provide personalised investment advisory services to customers. DBS Bank's commitment to raise the quality of customer service through staff training, harnessing the latest computer technology and by upgrading its physical facilities will continue. The thrust is towards providing convenient self-service facilities for routine banking transactions, complemented by personalised advisory services for more sophisticated banking needs. INTERNATIONAL he overseas offices performed satisfactorily. In Japan, the treasury operations of Tokyo Branch expanded. The branch handled an increasing volume of documentary trade transactions. In its first year of operations, Osaka Branch concentrated on trade financing Tand domestic lending to medium-sized corporations. In Seoul, trade financing and short-term lending continued to be profitable. In Taiwan, business activity in Taipei Branch slowed down considerably as the banking industry and the financial system came under severe strain. DBS Asia Ltd, the Bank's wholly-owned subsidiary in Hong Kong, performed satisfactorily following improvements in the operating environment resulting from the signing of the Sino-British agreement on the future of Hong Kong. Loan and trade financing activities slowed down at New York Agency. Treasury activities however increased considerably. Successful computeri- sation and integration of the Agency's money transfer, accounting and communications systems enabled the Agency to handle an almost ten-fold increase in money transfer volume. Los Angeles Agency saw greater contributions from documentary business. A gradual shift to fee-based activities is envisaged in 1986. London Branch continued to pursue a selective lending policy. Turnover of its foreign exchange and money market operations increased. Regulatory changes proposed in Hong Kong as well as liberalisation measures in Japan and the United Kingdom will shape the future scope and activities of DBS Bank's offices in these countries. DBS Bank's correspondent network continued to expand in 1985. As at end-1985, DBS Bank had 589 correspondents in 72 countries. TREASURY he year was marked by volatile movements in the foreign exchange market. Amid such conditions, the Bank stepped up its trading activities and sought new approaches in its operations. Turnover in foreign exchange transactions increased by about T37% with trading profits 25% higher than in 1984. The Bank also started to trade in European Currency Units (ECUs) in 1985. In the local money market, DBS Bank took the initiative to develop a more active secondary market for Singapore Government Registered Stocks and was the first bank to quote dealing prices for more than 15 issues. Besides making an institutional market in these bonds, the Bank also plans to retail them to its customers through its branches. The Bank's turnover in US treasury instruments in the cash and futures markets quadrupled in 1985. There was also active trading in Eurobonds. 9 Staff are encouraged to develop themselves to their fullest potential. . . both at work and in their leisure time. In 1985, DBS Bank raised 5 billion Yen by way of a syndicated loan. The Bank also obtained Yen via two six-month revolving Certificate of Deposit issuance facilities, each of 3 billion Yen. The funds raised were for the Bank's general operations. During the year, the Bank installed its computerised Global Limits System in Singapore, London, Tokyo, New York, Los Angeles and Hong Kong. This on-line, real-time system significantly improves the Bank's ability to monitor exposures arising from treasury operations. The system will be extended to the other overseas offices in 1986.

INVESTMENT BANKING he Bank continued to be the major mobiliser of S$ funds in the domestic capital market, accounting for approximately 58% of the funds raised by Singapore-incorporated companies on the Singapore Stock Exchange. TDBS Bank was the lead manager and underwriter of Singapore Airlines Limited's offer of shares. This issue, the largest in Singapore, raised S$500 million and attracted subscriptions of S$ 1.32 billion from the investing public, in Singapore and abroad. DBS Bank was also the joint lead manager for a S$20-million 8 percent Guaranteed Notes issue by Orient Leasing Singapore Limited. DBS Bank co-managed two of the four issues in the Asian Dollar Bond market. The Bank also participated in the underwriting of Eurodollar Bond and foreign equity issues and was one of the managers for an issue of 1 million Depository Receipts of Singapore by Yaohan Department Store Co Ltd, Japan. DBS Securities Singapore Pte Ltd, a wholly-owned subsidiary of DBS Bank, was set up to provide stockbroking services, an extension of the DBS Group's range of activities. DBS Securities started trading on the Stock Exchange of Singapore in February 1986. In response to the growing importance of Singapore as a regional funds- management centre and the impending liberalisation of the use of Central Provident Fund(CPF) funds, the scope of DBS Bank's investment management services was broadened and new products introduced. The Shenton Growth Fund, a unit trust fund invested in the Singapore stock market was launched in June 1985. It is the first of a family of unit trusts called DBS Evergreen Funds, designed to provide a wider range of investment alternatives for the Bank's customers. A Client Services unit was set up to provide personalised services to customers. In response to the growing commitment of customers' funds to overseas capital markets, a separate International Equities group was set up to provide wider and more specialised research coverage. An Information Technology unit was also established to co-ordinate the automation of the Bank's investment management operations. The year saw an increase of more than 30% in the number of institutional custodian customers.

PROPERTIES fter-tax profits for DBS Land and its subsidiaries declined from S$7.6 million in 1984 to S$5.5 million in 1985. In spite of keen competition from newly completed buildings, the DBS Group's office and shopping complexes continued to Aenjoy near-full occupancy. Demand for industrial space remained slow because of the economic downturn, but the leasing of the Group's bungalows at Cluny Hill Park and Ladyhill Park met with satisfactory response. Upgrading of facilities at DBS Building and Plaza Singapura progressed on schedule and is expected to be completed in 1986. The computerised car park system at Plaza Singapura was successfully commissioned in April 1985.

11 In support of the arts . . . a member of a Chinese orchestra at a classical music performance sponsored by DBS Bank. Construction of the Raffles City complex is nearing completion. The complex will be opened in phases. Tenants have moved into the 42-storey office tower — Raffles City Tower — which was completed in December 1985. The Westin Plaza Hotel opened in February 1986. The Westin Stamford as well as the Raffles City convention and shopping centres will open in the second half of 1986. During the year, the corporate structure of the DBS Land Group was streamlined with the voluntary liquidation of Raffles Holdings Pte Ltd. The assets of Raffles Holdings, primarily shares in Raffles City Pte Ltd, were distributed to the shareholders, Temasek Holdings Pte Ltd and DBS Land Ltd. FINANCE COMPANY The operating profits for DBS Finance reached S$23.1 million, an OPERATIONS increase of 10.2% over the preceding year. However, a signifi- cantly higher amount of S$l 1.7 million was set aside in 1985 against S$2.9 million in 1984 to cover possible diminution in the value of assets. This accounted for the decline in net profit after tax, from S$9.7 million in 1984, to S$5.3 million in 1985. Total assets of DBS Finance rose from S$677.1 million as at end-1984 to S$801.7 million as at end-1985. Loans and advances decreased from S$636.4 million in 1984 to S$627.3 million in 1985. Total deposits grew by S$161.2 million to reach S$586.6 million, a 37.9% increase. DBS Finance extended its factoring services to exports, being the first institution to offer such services under the Government's Small Industries Finance Scheme. In December 1985, DBS Finance increased its issued and paid-up capital from S$5.2 million to S$12.0 million, by way of a bonus issue, bringing the company's capital base more in line with its increased scale of operations. INSURANCE Intense competition in an environment of excess capacity in the insurance industry resulted in severe premium rate erosion. However, firmer rates were seen in the reinsurance market. Against this backdrop, The Insurance Corporation of Singapore (ICS) registered a net profit after tax and minority interest of S$7.3 million, a 2.3% decrease from 1984. Lower underwriting profits contributed to the decline in net profit after tax. Net investment income and profits from the life business were higher, compared to 1984. Gross premium income from general insurance was S$96.5 million compared to S$89.5 million in 1984. Premiums for marine cargo and hull continued to decline, indicative of depressed conditions in the marine- related industries. Premiums in the workmen's compensation class also decreased, due to retrenchments in labour-intensive industries such as construction and shipbuilding and repairing. However, growth was achieved in the other classes of general insurance, particularly in Fire and Miscellaneous Accident. A new department was formed to cater to the growing insurance needs of individuals. ICS' life business saw satisfactory growth. New Business Sums Assured grew by 25% to S$1261.8 million. Annual premiums net of reinsurances reached S$23.4 million, compared with S$21.0 million in 1984. The total value of life policies in force as at 31st December 1985 stood at S$4,307 million. During the year, ICS launched and saw good response to its Individual Disability Income Insurance Scheme, an extension of its Group Disability Income Insurance Scheme introduced in 1984 for employers. ICS' Annuity Scheme to meet the needs of those planning for retirement was also favourably received.

13

Financial Report

CONTENTS

Financial Review 17 Directors' Report 18 Balance Sheet 22 Profit and Loss Account 24 Statement of Changes in Financial Position 25 Notes to the Accounts 26 Statement by the Directors 35 Statutory Declaration 35 Auditors' Report 36 Shareholding Statistics 37 Five-Year Summary of Operations 38 Share Prices and Turnover 40

15 Simplified Group Financial Position excluding Acceptances) Guarantees and Other Obligations

Group Total Assets (Interest Earning and Non-Interest Earning) (percent) Financial Review

In 1985, net profit after tax for the DBS Group declined by 28.4% to SI86.2 million. After-tax profits for the Bank decreased by 29.4% to S$71.9 million. These results reflect the difficult economic environment in 1985. Banking income increased by 8.0% over 1984, due to contributions from fee-and commission-based operations and from securities transactions. Contributions from lending activities were maintained despite weak loan demand and declining interest rates resulting in reduced margins. Income from non-banking operations declined. Although occupancy rates of the Group's properties were maintained at close to 1984 levels, reduced rental rates led to lower rental income. The Group's dividend income also fell. The Bank made substantial investments in data resources in 1985, to ensure efficiency and competitiveness over the long term. Recruitment and training of staff continued, to meet needs in new and expanding areas of business in the financial services sector and to support the computerisation programme. These strategic investments in personnel and information technology accounted for most of the increase in "other expenses". The Group increased both general and specific provisions in view of the economy's uncertain outlook. Declines in property values and the poor performance of the manufacturing sector largely accounted for the increase in provisions. Increased earnings from Asian Currency Unit activities and investments in Singapore Government securities, which enjoy concessionary tax rates, accounted for the low tax rate in 1985. Total assets including acceptances, guarantees and other obligations of the Group rose by 24.2% due largely to an increase in the securities portfolio and contra items, principally foreign exchange contracts. Total assets, excluding contra items, increased by 9.5% to S$14,050.8 million. Total non-bank customer deposits grew by 27.1% to S$7,813.7 million. Total loans and advances for the Group declined by 5.9%. Group shareholders' funds increased to S$ 1,728.6 million as at 31st December 1985. The return on average shareholders' funds was 5.1% in 1985 compared with 8.0% in 1984. After-tax earnings per share declined to 29.7 cents compared with 45.6 cents in 1984. However, net tangible asset backing per share increased from S$5.79 as at end-December 1984 to S$5.95 as at end-December 1985. The Banking Act requires the transfer of stipulated proportions of after-tax profits to the general reserve fund. 25% of DBS Bank's after-tax profits, amounting to S$18.0 million, was transferred to the general reserve fund bringing the total in this fund to S$253.8 million as at end-1985. The Board of Directors deemed it prudent to recommend the payment of a smaller second and final dividend of 6%, compared to 8% in 1984, making a total distribution of 14% less 40% income tax, in respect of the financial year ended 31st December 1985.

Group Total Income (Interest Income and Non-Interest Income) (percent)

17 Directors' Report The Development Bank of Singapore Ltd and its Subsidiary Companies

The directors herewith submit their report to the members together with the audited accounts of DBS Bank and of DBS Group for the year ended 31st December 1985, which have been prepared in accordance with the provisions of the Companies Act, Cap 185, with certain modifications and exceptions as have been determined by the Monetary Authority of Singapore. Results for the furancial year

The results of the operations of DBS Bank and of DBS Group during the financial year have not been substantially affected by any item, transaction or event of a material and unusual nature.

Dividends The directors propose that a second and final dividend of 6% less income tax amounting to S$ 10,460,000 be paid. A second and final dividend of 8% less income tax amounting to S$ 13,932,894 provided in the 1984's accounts was paid in 1985. The dividend paid included an amount of S$3,437 on shares issued on conversion of the S$7½% Convertible Unsecured Loan Stock 1991 and US$5½% Convertible Bonds 1998 subsequent to 31st December 1984 not provided for in the accounts of that year. An interim dividend of 8% less income tax amounting to S$ 13,932,915 was paid in 1985. Principal Activities The principal activities of DBS Bank and of DBS Group consist of the business of banking and development financing, lease and hire-purchase financing, real estate investment and development, insurance and corporate advisory services. There have been no signficant changes in the nature of these activities during the year.

Share Options a The holders of the S$228,518,520 7 1/2% Convertible Unsecured Loan Stock 1991 have the option to convert the Loan Stock into fully paid shares of S$ 1.00 each in DBS Bank from 1st January 1982 to 31st May 1991 at a price of S$7.20 per share, after adjustment for issue of shares subsequent to the issue of the Loan Stock. Full conversion of the Loan Stock outstanding as at 31st December 1985 would require the issue of 31.4 million shares of S$ 1.00 each, subject to any further adjustment that may be made to the conversion price. b The holders of the US$70,000,000 5 1/2% Convertible Bonds 1998 have the option to convert the Bonds into fully paid shares of S$1.00 each in DBS Bank from 1st December 1983 to 13th November 1998 at a price of S$8.34 per share, after adjustment for issue of shares subsequent to the issue of the Bonds. For the purpose of this conversion, the exchange rate is fixed at S$2.1305 to US$1.00. Full conversion of the Bonds outstanding as at 31st December 1985 would require the issue of 13.9 million shares of S$1.00 each, subject to any further adjustment that may be made to the conversion price. c The holders of the above Loan Stock and Bonds have no right by virtue of the options to participate in any share issue of any other company.

18 Share Issues During the financial year, DBS Bank issued:- a 4,353 shares of S$ 1.00 each fully paid upon conversion of S$31,356 7 1/2% Convertible Unsecured Loan Stock 1991, and b 355,082 shares of S$1.00 each fully paid upon conversion of US$1,390,000 5'/2% Convertible Bonds 1998. The following subsidiaries issued shares as stated below:- a DBS Finance Ltd increased its issued and paid-up share capital from 5,200,000 to 12,000,000 ordinary shares of S$ 1.00 each by capitalising S$6,800,000 from the Share Premium Account, bringing the capital base in line with the company's increased scale of operations. b DBS Pte Ltd issued 68,049,998 ordinary shares of S$ 1.00 each fully paid in cash for its equity investment in Raffles City Pte Ltd. Note Option The holder of each of the 75,000 Warrants to purchase US$75,000,000 14%% Notes due 1989 has the right to purchase US$1,000 Notes between 13th August 1982 and 12th September 1986 at 100% of the principal amount thereof plus accrued interest from the 12th August next preceding the date of exercise.

3 Note Issue During the financial year, DBS Bank issued US$50,311,000 14 /8% Notes due 1989 upon exercise of 50,311 Warrants. Asset Values Before the profit and loss accounts and balance sheets were made out, the directors took reasonable steps:- a to ascertain the action taken in regard to writing off and providing for bad and doubtful debts and have satisfied themselves that all known bad debts have been written off and that adequate provision has been made for doubtful debts and b to ensure that any current assets which were unlikely to realise their book values in the ordinary course of business have been written down to their estimated realisable values. At the date of this report, the directors are not aware of any circumstances which would render:- a the amounts written off or provided for bad and doubtful debts in the accounts of DBS Bank and of DBS Group inadequate to any material extent, or b the values attributed to current assets in the accounts of DBS Bank and of DBS Group misleading. Subsequent Euents In the opinion of the directors, no item, transaction or event of a material and unusual nature has arisen which would affect substantially the results of the operations of DBS Bank and of DBS Group for the current financial year. At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report or accounts of DBS Bank and of DBS Group which would render any amounts stated in the accounts misleading. On 7th February 1986, DBS Securities Pte Ltd, a wholly-owned subsidiary, was set up to conduct stockbroking business.

19 Contingent Liabilities No contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinion of the directors, will or may affect the ability of DBS Bank or DBS Group to meet their obligations when they fall due. At the date of this report, there does not exist any:- a charge on the assets of DBS Bank or of DBS Group which has arisen since the end of the financial year which secures the liability of any other person, or b contingent liability which has arisen since the end of the financial year, other than those normally undertaken in the course of the activities of DBS Bank or of DBS Group.

Directors The directors in office at the date of this report are:- Howe Yoon Chong — Chairman Chua Kim Yeow — Deputy Chairman Patrick Yeoh Khwai Hoh— President Dirk van Hilten Koh Cher Siang Lim Siong Guan Ngiam Tong Dow Wong Hung Khim Frank Yung-Cheng Yung Since the end of the previous financial year, no director has received or has become entitled to receive a benefit under a contract which is required to be disclosed by Section 201(8) of the Companies Act, Cap 185. Pursuant to the DBS Bank Share Ownership Scheme, the object of which is to provide an opportunity for all eligible employees of the Group, including Directors holding salaried employment in the Group, to participate in the equity of DBS Bank under the Scheme, the following directors participated and had an interest in the following number of units in the Scheme: Number of Units in the Scheme As at 31.12.84 or date of As at 31.12.85 appointment Howe Yoon Chong 32,109 Chua Kim Yeow 86,912 62,292 Patrick Yeoh Khwai Hoh 77,175 54,457' The total number of units in the Scheme is computed in accordance with Clause 23 of the Scheme, and the position as at 31st December 1985 was as follows:-

20 Other than the aforesaid DBS Bank Share Ownership Scheme, during and as at the end of the financial year, DBS Bank was not a party to any arrangement, whose object is to enable the directors to acquire benefits through the acquisition of shares or debentures in DBS Bank or any other body corporate. According to the register of directors' shareholdings, the undermentioned persons who were directors of DBS Bank at the end of the financial year, had interest in shares and debentures in DBS Bank and related companies as detailed below:- Holdings in which Holdings registered Director is deemed in name of Director to have an interest As at As at 31.12.84 31.12.84 As at or date of As at or date of 31.12.85 appointment 31.12.85 appointment

Number of DBS Bank Shares of S$1.00 each Howe Yoon Chong 96,404 96,4042 Ngiam Tong Dow — — 5,000 5,000 Frank Yung-Cheng Yung 10,250 10,250 Amount of DBS Bank S$7!/2% Convertible Unsecured Loan Stock 1991 Chua Kim Yeow 20,000 Ngiam Tong Dow — 3,625 3,625 Frank Yung-Cheng Yung 8,000 8,000 Number of ICS 3 Shares of S$1.00 each Patrick Yeoh Khwai Hoh 6,000 6,000' — — 1 appointed wef 1st January 1985 2 appointed wef 1st February 1985 3 The Insurance Corporation of Singapore Ltd Directorate In accordance with Article 95, the following directors retire and, being eligible, offer themselves for re-election pursuant to Article 96:- Chua Kim Yeow Koh Cher Siang Wong Hung Khim Auditors Price Waterhouse have expressed their willingness to accept re-appointment.

On behalf of the Directors

Howe Yoon Chong

Chua Kim Yeow Directors 4th March 1986 Singapore

21 Balance Sheet as at 31st December 1985

US$/S$ exchange rate as at 31st December (See notes on pages 26 to 34, which form part of these accounts)

Profit and Loss Account Year Ended 31st December 1985

US$/S$ exchange rate as at 31st December (See notes on pages 26 to34, which form part of these accounts) Statement of Changes in Financial Position Year Ended 31st December 1985 Notes to the Accounts

Note 1 The following are the principal accounting policies applied by DBS Bank and its subsidiaries Principal Accounting policies and are consistent with those applied in the previous year. 1.1 Basis of consolidation The consolidated profit and loss account and balance sheet include the results, assets and liabilities of DBS Bank and all its subsidiaries made up to 31st December 1985. These subsidiaries are companies in which DBS Bank had an interest of over 50% in the issued share capital at balance sheet date. The share of results of all other companies in which the DBS Group had an interest has been included in the profit and loss account to the extent of dividends received or receivable. 1.2 Foreign Currencies Foreign currency assets and liabilities have been translated into Singapore dollars at the rates of exchange approximating those ruling at balance sheet date and transactions during the year are converted at the rates of exchange ruling on the transaction dates. Exchange differences arising from foreign currency translation are included in the profit and loss account with the exception of exchange differences on long-term borrowings and long-term loans which are included in the profit and loss account as and when realised. 1.3 Basis of valuation of loans, advances and investments 1.3.1 Loans and advances Loans and advances are stated after deduction of provisions for possible losses. These provisions comprise specific provisions against certain loans and advances and a general provision on the remaining loans and advances. Specific provision is based on the borrower's debt servicing ability and adequacy of security. 1.3.2 Equity and other investments (1) Unquoted investments are stated at cost less provisions. These provisions comprise specific provisions against certain investments and a general provision on the remaining investments. Specific provision is based on the earning capacity of the companies and their net tangible asset backing. (2) Investments in quoted shares, bonds and loan stocks are stated at the lower of total cost less provision and total market value at year end. The provision is based on the earning capacity of the companies and their net tangible asset backing. (3) Government Treasury bills and securities are stated at the lower of total cost and total market value at year end. (4) Shares in subsidiary companies are stated at cost less provision. The provision is based on the earning capacity of the companies and their net tangible asset backing. 1.4 Basis of valuation of current assets Provision has been made against other current assets not covered by 1.3 above so as to reduce them to their estimated realisable values. 1.5 Depreciation Assets are stated at cost or valuation less accumulated depreciation. The basis of depreciation is as follows:- 1.5.1 Leasehold land where the balance of the leasehold period is 100 years or less, is amortised over the remaining period of the lease. No amortisation is made on freehold land and on leasehold land where the unexpired lease period is more than 100 years. 1.5.2 Buildings, excluding plant and machinery installed therein, are depreciated on a straight-line basis over their useful lives estimated at 50 years or over the period of the respective leases, whichever is the shorter. 1.5.3 Other assets are depreciated on a straight-line basis over their estimated useful lives as follows:- Plant and machinery 2 — 20 years Office equipment 1 — 10 years Furniture and fittings 1 — 5 years 1.5.4 No provision for depreciation is made for properties in the course of development or completed properties held for sale. 26 1.6 Leasing and hire purchase transactions 1.6.1 Lease instalments received are apportioned into principal and interest in the ratio of principal to total interest. In previous years, lease instalments were taken wholly as income. The change in accounting policy has no material effect on the current year's profit. 1.6.2 Hire purchase instalments received are apportioned into principal and interest in the ratio of principal to total interest computed at the commencement of the hire purchase agreement. 1 7 Real estate transactions 1.7.1 Real estate is stated at cost or valuation. Cost includes interest on borrowings used to finance the purchase and construction of the projects and other direct expenditure and related overheads incurred during the construction period. Development is considered complete on issue of the temporary occupation licence. When completed, properties held for investment are classified as fixed assets and properties held for sale are classified as real estate. Completed properties for sale are stated at cost less proportionate cost of units sold. 1.7.2 Profits are recognised on issue of the temporary occupation licence on the individual units sold up to the percentage of the contract price due from the purchaser. 1.8 Taxation The taxation charged to the profit and loss account represents income tax at the current rate based on profits earned during the year. Deferred taxation in the balance sheet computed based on the liability method, represents tax at current rates on the timing differences between accounting income and taxable income. Timing differences are principally in respect of provision for diminution in value of assets, depreciation and certain classes of accrued income.

Note 2 2.1 Issued Share Capital

2.2 During the year, DBS Bank issued:- (1) 4,353 shares of S$1.00 each upon conversion of S$31,356 7 1/2% Convertible Unsecured Loan Stock 1991. (2) 355,082 shares of S$ 1.00 each upon conversion of US$1,390,000 5 1/2% Convertible Bonds 1998.

Note3 Share Premium Account Note 4 Capital Reserue

Note 5 General Reserue

The amounts transferred to the Reserve Fund comply with the Banking Act, Cap 182 and the Finance Companies Act, Cap 191.

Note 6 6.1 Convertible securities Long-term Borrowings 6.1.1 The following is a summary of convertible securities, all of which were due after 12 months as at 31st December:-

6.1.2 The S$7½% Convertible Unsecured Loan Stock 1991 and US$5½% Convertible Bonds 1998 are convertible into fully-paid shares of S$1.00 each in DBS Bank at the option of the holder at the price of S$7.20 and S$8.34 per share respectively. These prices have been adjusted for the issue of shares subsequent to the issue of the securities, in accordance with the provisions of the respective Trust Deeds. For the purpose of conversion of the US$5½% Bonds, the exchange rate is fixed at S$2.1305 to US$1.00. As at 31st December 1985, S$2,756,727 of the Loan Stock and US$15,745,000 of the Bonds had been converted to shares. 6.1.3 The issues may be redeemed prior to maturity, in whole or in part, in accordance with the provisions of the respective issue agreements. Unless previously redeemed or converted, the issues will be redeemed at par on maturity date. As at 31st December 1985, there had been no redemption.

28 6.2 Debt securities 6.2.1 The following is a summary of the debt securities. Except for the S$ Guaranteed Floating Rate Notes 1986 which were due within 12 months as at 31st December 1985, the other securities were due after 12 months as at 31st December:-

6.2.2 The US$15 1/2% Notes 1989 were issued together with an issue of Warrants to purchase US$1,000 principal amount of US$143/8% Notes 1989 of up to US$75 3 million at par. As at 31st December 1985, US$67,085,000 14 /8% Notes had been issued upon exercise of 67,085 Warrants. 6.2.3 The S$ Guaranteed Floating Rate Notes 1986 issued by Singapore Factory Development Ltd, a wholly-owned subsidiary, are guaranteed by DBS Bank. The interest, payable semi-annually, is determined every three months at the rate of 1/4% per annum above the three-month interbank offered rate for Singapore dollar deposits, subject to a minimum rate of 6% per annum. These notes will be redeemed on 4th April 1986. 6.2.4 Certain of the issues may be purchased and cancelled, or redeemed prior to maturity, in whole or in part, in accordance with the provisions of the respective issue agreements. Unless previously purchased and cancelled or redeemed, the issues will be redeemed at par on maturity date. As at 31st December 1985, there had been no purchase and cancellation or redemption. 6.3 Other borrowings 6.3.1 The periods and amounts of borrowings due for repayment under the various lines of credit granted by the Government of Singapore and borrowings from financial institutions at 31st December are tabulated below:-

6.3.2 As at 31st December 1985, out of the long-term lines of credit to DBS Bank, an amount of S$29.6 million (1984 S$226.1 million) was drawable but not drawn. The requirement for such funds has in the meantime been met by funds from other sources. 6.3.3 Out of the amount of S$l,915.2 million (1984 S$2,297.5 million) outstanding on total borrowings of DBS Group at 31st December 1985, an amount of S$410.5 million (1984 S$329.6 million) will be due for repayment after five years.

29 Note 7 7.1 The subsidiaries of DBS Bank are as follows:- Subsidiary Companies 7.2 Amounts owing by subsidiaries These amounts comprise secured loans and advances to subsidiary companies.On 27th August 1985, Raffles Holdings Pte Ltd and Raffles City Pte Ltd ceased to be subsidiaries. Loans granted by the Bank to Raffles City Pte Ltd included as amounts owing under "Subsidiary Companies" in 1984 have now been included as loans due after twelve months under "Loans & other Long-Term Investments". Note 8 The following amounts relating to current taxation have been included in this item:- Accounts Payable, Provisions and Accrued Charges

Note 9 The cost and market value of these investments at 31st December were as follows:- Government Treasury Bills and Securities, Quoted Investments Note 10 10.1 The net book value as at 31st December was as follows:- Real Estate

10.2 The leasehold property owned by Raffles City Pte Ltd included under "Properties in the course of development" in 1984 has been excluded from the Group's accounts as the Company ceased to be a subsidiary in 1985. Note 11 11.1 The net book value as at 31st December, at cost or valuation less accumulated Fixed Assets depreciation, was as follows:-

32 11.2 Included in "Fixed Assets" is Plaza Singapura which was revalued based on an appraisal by an independent firm of professional valuers in March 1982 when the property was transferred to a wholly-owned subsidiary as part of a restructuring exercise. The surplus on revaluation was taken directly to Capital Reserve. The current valuation of Plaza Singapura is lower than the March 1982 valuation. The current shortfall in valuation is not incorporated in the accounts as this is a long-term investment property. Other properties owned by the Group included in "Fixed Assets" are stated at cost. Total book value of all properties in the Group under "Fixed Assets" at balance sheet date was S$626 million (1984 SS606 million) and total market value was estimated at S$634 million (1984 S$755 million).

Note12 The amounts outstanding at 31st December comprise the following:- Acceptances, Guarantees and Other Obligations (Contra)

Note 13 Income Profit and Loss Account 13.1 Interest earned comprises interest arising from various types of lending activities and includes interest on securities. 13.2 Dividends from investment in shares include for DBS Bank, gross dividends of S$6.6 million (1984 S$6.0 million) from subsidiary companies. 13.3 Rental represents income on the tenanted areas of the buildings owned by DBS Bank and its subsidiaries. 13.4 Other income comprises commission, profits on exchange, merchant banking fees, insurance premiums, profits on sale of investments and real estate and all other income not reflected under any of the aforementioned items of income. Expenses 13.5 Interest expense comprises all interest incurred on deposits, bonds and borrowings from the Singapore Government and other sources. 13.6 Other expenses include amounts incurred in the maintenance and service of buildings owned by DBS Bank and its subsidiaries, general administration and other expenses. The following expenses have been included in this item:-

13.6.1 Directors' remuneration increased in 1985 due to the appointment of additional directors in executive positions.

33 13.7 Dividend The proposed dividend is based on the issued share capital at balance sheet date. Dividends payable on shares issued on conversion of the S$7½% Convertible Unsecured Loan Stock 1991 and US$5½% Convertible Bonds 1998 subsequent to balance sheet date and up to the date of closure of the Share Transfer Books and Register of Members are included in the profit and loss account when paid.

Note 14 Capital Commitments

Note 15 Certain of the comparative figures have been restated to conform with the current year's Comparative Figures treatment.

34 Statement by the Directors

We, Howe Yoon Chong and Chua Kim Yeow, two of the directors of The Development Bank of Singapore Ltd, state that in the opinion of the directors, the accompanying balance sheets, profit and loss accounts and the consolidated statement of changes in financial position together with the notes thereon as set out on pages 22 to 34, are drawn up so as to give a true and fair view of the state of affairs of DBS Bank and of DBS Group, consisting of DBS Bank and its subsidiaries, at 31st December 1985, the results of the business of DBS Bank and of DBS Group and the changes in financial position of DBS Group for the year ended on that date. On behalf of the Directors

Howe Yoon Chong

Chua Kim Yeow Directors 4th March 1986 Singapore

Statutory Declaration

I, Tan Bee Leng,Vice-President of The Development Bank of Singapore Ltd, do solemnly and sincerely declare that the accompanying balance sheets, profit and loss accounts and the consolidated statement of changes in financial position, together with the notes thereon as set out on pages 22 to 34, are to the best of my knowledge and belief, correct and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1835.

Tan Bee Leng (Miss) Vice-President Finance and Tax Department

Subscribed and solemnly declared by the above-named in Singapore on 4th March 1986.

Before me

Commissioner for Oaths Singapore

35 Auditors' Report

To the Members of The Development Bank of Singapore Ltd. We have audited the accounts set out on pages 22 to 34 in accordance with the Statements of Auditing Guideline and Statements of Auditing Practice. In our opinion:- (a) the accounts are properly drawn up in accordance with the provisions of the Companies Act, Cap 185 and the Statements of Accounting Standard, with such modifications and exceptions as have been determined by the Monetary Authority of Singapore and give a true and fair view of:- (i) the state of affairs of DBS Bank and of DBS Group as at 31st December 1985 and of the results of DBS Bank and of DBS Group and the changes in financial position of DBS Group for the year ended on that date; and (ii) the other matters required by Section 201 of the Act to be dealt with in the accounts; (b) the accounting and other records and the registers required by the Act to be kept by DBS Bank and by those subsidiaries incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act. We have considered the accounts and auditors' reports of all the subsidiaries of which we have not acted as auditors, being accounts that have been included in the consolidated accounts. The names of these subsidiaries are:- Audited by our associate firms:- DBS Asia Ltd Sapperton Ltd The Insurance Corporation of Singapore (UK) Ltd We are satisfied that the accounts of the subsidiaries that have been consolidated with the accounts of the holding company are in form and content appropriate and proper for the purposes of the preparation of the consolidated accounts, and we have received satisfactory information and explanations as required by us for those purposes. The auditors' reports on the accounts of the subsidiaries were not subject to any qualification and in respect of subsidiaries incorporated in Singapore did not include any comment made under subsection (3) of Section 207 of the Act.

Price Waterhouse Public Accountants Singapore

4th March 1986 Singapore

36 Shareholding Statistics as at 15th February 1986

Class of Shares — Ordinary Shares of S$1.00 each fully paid Voting Rights — One vote per share

Twenty Largest Shareholders (as shown in the Register of Members)

Directors' Shareholdings (as at 21st January 1986) DBS Bank Shares in which DBS Bank Shares registered Director is deemed to Name of Director in the name of Director have an interest Howe Yoon Chong 96,404 Ngiam Tong Dow — 5,000 Frank Yung-Cheng Yung 10,250

ICS' Shares in which ICS3 Shares registered Director is deemed to in the name of Director have an interest Patrick Yeoh Khwai Hoh 6,000

No of units in the DBS Bank Share Ownership Scheme Howe Yoon Chong 36,003 Chua Kim Yeow 89,716 Patrick Yeoh Khwai Hoh 79,776

1 Temasek Holdings Pte Ltd is a company wholly owned by Minister for Finance Incorporated. 2 Post Office Savings Bank of Singapore is a Statutory Board of the Government of Singapore. 3 The Insurance Corporation of Singapore Ltd

37 Five-Year Summary of Operations of DBS Bank

Notes: 1 Contra refers to acceptances, guarantees and other obligations. 2 Dividend per share and earnings per share after tax have been adjusted for the rights issue in 1984 and shares arising from conversion. 3 Liquid assets comprise cash, deposits and balances with banks and agents, money at call and short notice and Government securities. 4 Risk assets comprise all assets except cash,deposits and balances with banks and agents, money at call and short notice, Government securities, fixed assets and contra1.

38 Five-Year Summary of Operations of DBS Group

Notes: 1 Contra refers to acceptances, guarantees and other obligations. 2 Dividend per share and earnings per share after tax have been adjusted for the rights issue in 1984 and shares arising from conversion. 3 Liquid assets comprise cash, deposits and balances with banks and agents, money at call and short notice and Government securities. 4 Risk assets comprise all assets except cash, deposits and balances with banks and agents, money at call and short notice, Government securities, fixed assets and contra'. Shares Prices and Turnover

Notes: 1. Earnings are Group profit after taxation attributable to members. 2. Dividend per share, earnings per share and share prices have been adjusted for the rights issue in 1984 and shares arising from conversion. 3. Share prices reflect transactions recorded on the Stock Exchange of Singapore. 4. In calculating dividend yields and net price-earnings ratios, the average share prices have been used. Economic Review

International The industrialised countries as a whole registered real GNP growth of 2%% in 1985, down from 4.9% in 1984. This was largely due to sluggish US economic activity, weak domestic demand in other OECD countries and a marked slowdown in world trade. Inflation stabilised at 1984 levels as commodity prices remained depressed and wage adjustments were moderate. Current account imbalances and strong protectionist pressures continued to be major economic and political issues. The Group of Five accord in September, aimed at defusing protectionist sentiments and improving US competitive- GDP Growth ness, marked a turning point in the US stand on exchange rate determination. Slower growth in the world economy and weakening commodity prices adversely affected Third World countries, undermining the debt-servicing ability of some major borrowers. During the year, no significant improvement was evident in the international debt situation. However, new suggestions to ease the LDC debt problem were made, in the form of the Baker proposals, which include a funding package to be provided by the IMF/World Bank and private banks as well as a continuing surveillance role for the IMF. Since, to succeed, the Baker Plan requires a major concerted effort from a number of private and multilateral agencies, the task of securing consensus and commitment is likely to be difficult. Singapore Economic Developments The Singapore economy contracted for the first time since 1964. Real GDP declined by 1.8%, in contrast to the 8.2% growth in 1984. The poor performance was attributable to a combination of internal structural problems and weak global demand. Employment fell in all major sectors and the unemployment rate rose to 4.9%. Productivity growth in all major sectors, except construction, slowed down sharply, while in the manufacturing sector, it declined. Consumer price inflation moderated to 0.5% from 2.6% in 1984 and wholesale prices declined further by 2.3% in 1985. Business sentiment in general was pessimistic during the year. Investment commitments dropped by 37.8% to S$1.1 billion. Foreign investment commitments were only two-thirds that of 1984. The construction sector, the fastest growing sector since 1982, registered the most Growth of the Financial & severe decline of 14.3% in contrast to the 15.5% growth in 1984. This reflected the Business Services Sector depressed state of the property market, with the persistent glut in private residential and commercial space. The value of contracts awarded continued to fall sharply. Output of the manufacturing sector fell by 7.3% in 1985, after a growth of 8.8% a year ago. The petroleum refining, shipbuilding and shiprepairing, and oil rig construction industries were adversely affected by changes in the world oil market. With the slowdown in global trade and the sharp decline in domestic activity, the trade sector contracted by 1.5%, against an expansion of 5.8% in 1984. Total trade decreased by 4.0% to S$ 108.0 billion, compared with the previous year's growth of 6.4%. The trade deficit narrowed to S$7.6 billion from S$9.8 billion in 1984. The overall balance of payments recorded a surplus of SI3.0 billion, and official foreign reserves increased by 19.0% to reach S$27.1 billion at end-1985. Tourist arrivals, short of earlier expectations, registered only a marginal increase of 1.3% over 1984, while the supply of hotel rooms expanded by 12.7%. The average hotel occupancy rate fell to 65.9% in 1985 from 75.5% the previous year. Growth of the transport and communications sector slackened to 3.0% from 9.8% in 1984. The impetus to growth continued to be from telecommunications and air transport services. During the year, efforts to address the problems confronting the economy were intensified. The government introduced a financial package of about S$l billion to stimulate economic activity and reduce operating costs. Other measures that have been recognised as necessary to help regain international competitiveness include a temporary cut in the employers' contribution to the Central Provident Fund (CPF), wage restraint and a return to greater flexibility in wage determination. An Economic Committee was

41 ' formed to undertake an in-depth mid-term review of Singapore's development plan for the 1980s. The reports of the eight sub-committees have contributed to a deeper understanding of the economy's problems and prospects. On the basis of their recommendations and other inputs from the public, the Economic Committee has formulated a bold strategy to revitalise the economy and provide new directions for future growth. The government has accepted, in principle, the policy recommendations of the Economic Committee.

Industry's S$ Loans & Financial Sector Developments Growth of the financial and business services sector Advances Growth slackened to 2.6% from 14.4% in 1984, reflecting the slowdown in general business activity. Apart from the recession, 1985 will also be remembered for upheavals in the financial markets. In September, the Monetary Authority of Singapore (MAS) intervened in the foreign exchange market to deter speculative selling of the Singapore dollar. Another development was the three-day suspension of trading in the Stock Exchange of Singapore (SES) in December following events surrounding Pan-Electric Industries Ltd., which led to the end of self-regulation in the stock market. More fiscal incentives were introduced during the year to further develop Singapore as a financial centre. To promote the Asian Dollar Market and funds-management, tax incentives were extended to cover additional offshore financial transactions, funds- management services, and the syndication of loans and credit facilities. On the domestic banking scene, the use of electronic means to transfer funds was further extended with the introduction of SHIFT (System for Handling Interbank Funds Transfer) and EFTPOS (Electronic Funds Transfer at Point-of-Sale). During the year, regulatory changes were directed at improving standards of financial practice. The Insurance Act was amended to provide for stricter supervision of insurers and to protect policy holders in the event of insolvency of insurance companies. New guidelines on lending limits and investments were issued to merchant banks, in line with similar provisions in the Banking and Finance Companies Acts. The stockbroking industry is currently undergoing significant changes. A new Securities Industry Bill seeks to consolidate and amend the Securities Industry Act by making better provisions for the Industry's S$ Deposits supervision of the securities industry in the interests of investors. Provisions include the Growth transfer of the administration of the Act to the MAS. The four major local banks have been permitted to establish stockbroking firms and granted seats on the Committee of the SES. There is to be further liberalisation in the use of CPF savings, to include investment in trustee shares and stocks, unit trusts and gold. Growth of money supply averaged 2.6% in 1985 compared with 3.1% in the previous year. Reflecting the worldwide trend towards lower interest rates and the need to stimulate domestic economic growth, interest rates in Singapore declined for the greater part of the year before stabilising in the fourth quarter. The average minimum lending rate of leading banks fell to 7.20% p.a. at end-1985 from 9.40% p.a. at end-1984. During the year, the Singapore dollar depreciated by 3.0% against the US dollar and 3.1% against the Yen, while it maintained its value against the Pound Sterling, the Deutschemark and the Swiss Franc. Against the Malaysian Ringgit, it strengthened by 2.7%. The pace of banking activity slowed down significantly. Total balance sheet footings of commercial banks increased by only 7.5% to reach S$70.6 billion at end-1985, compared with the robust 16.2% growth in 1984. Given the recessionary environment, growth in non-bank loans and advances decelerated to 3.2% while bills financing declined by 12.0% in 1985. Total bank credit reached SI37.4 billion, an increase of 1.5% against 8.3% in 1984. The bulk of the increase consisted of loans to the building and construction sector (33.3%), professional and private individuals (25.7%), and financial institutions (15.6%). At end-

42 1985, non-bank deposits amounted to S$28.7 billion, an increase of 2.6% against 6.7% a year ago. Value of the Singapore In the Asian Dollar Market, loans grew by 10.9% in 1985, slightly below the rate Dollar Against Selected recorded in 1984. However, total assets increased by 21.3% to reach US$155.4 billion, Currencies compared with 14.5% a year ago. Deposits increased significantly by 30.2% in contrast to (December 1984 = 100) the previous year's 4.4% growth. Reduced funding requirements led to fewer new issues of US dollar Floating Rate Certificates of Deposit. Seven new issues amounting to US$245 million were floated against 15 new issues valued at US$375 million in 1984. In the Bond market, four issues aggregating US$235 million were floated in 1985 compared with eight issues valued at US$864 million in 1984. Total assets of finance companies declined by 4.2% in 1985 to S$6.9 billion in contrast to the previous year's 11.0% growth. Hire purchase financing dropped steeply by 29.9% compared with the fall of 7.9% in 1984, reflecting the continuing downtrend in the demand for car loans. With a weak property market and keen competition from banks, growth in housing loans slackened to 2.8% from 15.7% a year ago. Merchant banks' assets grew by 9.1% in 1985, almost maintaining the previous year's growth. Holdings of securities and equities expanded more than two-fold since 1984 while interbank activity rose moderately. Loans and advances to non-bank customers, however, declined by 7.2% in 1985 to S$12.7 billion. Trading in the stock market was generally subdued during the year as periodic rallies were not sustained. Turnover amounted to 3.02 billion units valued at S$6.3 billion against 3.04 billion units valued at S$8.2 billion in 1984. Investor confidence was adversely affected by the difficult domestic economic conditions. The suspension of trading in December further weakened sentiment. The SES All-Share Price Index registered a loss of Comparative 19.6% over the year. Interest Rates The volume of contracts traded on SIMEX has increased rapidly since its inception in (percent per annum) September 1984. During 1985, demand for Eurodollar contracts was heavy with trading amounting to 294,760 lots, more than half the total volume traded. Trading in Deutschemark, gold and Japanese Yen contracts reached 170,346,42,186 and 31,537 lots respectively. Trading in a new contract, the Nikkei Stock Average, is expected to commence in the second half of 1986.

Economic Prospects The performance of the Singapore economy is not expected to improve significantly in 1986 as both internal and external sources of growth will continue to be weak. All major sectors are likely to post negative or sluggish growth. With the persistent property glut, an early recovery in construction activity is not expected. The manufacturing sector will undergo further rationalisation with emphasis on regaining competitiveness and increasing productivity. In the commerce and transport and communications sectors, the outlook is for weak performance in view of the slowdown in world trade. The financial and business services sector will inevitably reflect the weakness in the other sectors. However, the measures introduced in 1985 to stimulate growth and to reduce operating costs, enhanced by implementation of the policy recommendations of the Economic Committee, should begin to exert favourable influences on the economy in the second half of 1986.

43 Corporate Directory as at 31st March 1986

BOARD OF DIRECTORS Principal Officers Administration, Credit Clementi Administration & Systems Manager Howe Yoon Chong CHAIRMAN Wong Choong Hoong Chairman Howe Yoon Chong Vice-President Crawford K C Selvadurai Chua Kim Yeow PRESIDENT Manager Deputy Chairman Ee Ho Inn Patrick Yeoh Khwai Hoh Assistant Vice-Presidents Patrick Yeoh Khwai Hoh Ho Hock Beng Goldhill EXECUTIVE VICE-PRESIDENTS President Arthur Tam Manager Lim Yong Wah Yeo Seh Boo Roger Leong Dirk van Hilten Michael Wee Koh Cher Siang Havelock SENIOR VICE-PRESIDENTS Lim Siong Guan Audit Manager N Ganesan Ngiam Tong Dow Soh Thian Sung Lau Chan Sin Vice-President Wong Hung Khim Lock Sai-Hung Tan-Oei Kim Hougang Frank Yung-Cheng Yung Ng Kee Choe Manager Soh Kim Soon Assistant Vice-President Joanne Kwan Oliver Tan Wee Wun Hua Executive Committee Jurong Tan Soo Nan Manager Bills & Remittances Howe Yoon Chong Ho Kum Koon Chairman VICE-PRESIDENTS Chan Choon Meng Vice-President Jurong East Patrick Yeoh Khwai Hoh Chan Mun Seng Deputy Chairman V Sivasubramaniam Manager Chong Kie Cheong Spencer Tan Ngiam Tong Dow Chow Kok Kee Assistant Vice-Presidents Tan Puay Hee Frank Chu Chan Ping Sum Katong Elsie Foh Ong Siew Mooi Manager Tan Boon Tuck Secretary Gan Kim Kok Shirley Loo-Lim Hong Tuck Kun Consumer Banking Kent Ridge Registrar Jen Shek Chuen Manager Barbinder & Co Pte Koh Kum Loon Senior Vice-President William Chia 9 Penang Road, #13-21 Koh Soo Boon Lau Chan Sin Supreme House Orchard Road Lee Koek Yong Singapore 0923 Vice-Presidents Manager Lim Kim Quee Chan Choon Meng Lam Siok Loon Auditors Lim Yin Kiat Elsie Foh Price Waterhouse Parkway Parade Loh Soo Eng Anthony Tan Public Accountants Manager Singapore Long Wil Kim Andrew Tan Shirley Loo-Lim Assistant Vice-Presidents Registered Office Ng Kim Leong Chia Hock Jin 6 Shenton Way Pickering Ong Hean Beng Law Yeu Leng Manager DBS Building Tan Tok Lan Singapore 0106 K C Selvadurai Pang Chee Seng Telephone: 2201111 V Sivasubramaniam Queensway Tan Bee Leng Singapore Banking Offices Manager Anthony Tan Ang Mo Kio Chua Whee Gek Tan-Oei Kim Manager Tan Keng Hock Catherine Phua Rochor Tan Soon Ann Manager Teng-Han Soon Lang Balestier Khoo Kee Cheok Thum Lay Chwan Manager Andrew Chong Shenton Way Tong Chi Lian Manager Raymond Wee Battery Road Janice Goh Yee-Tang Jee Hong Manager Jan Pang Tampines Manager Other Principal Officers Bedok Wong Zaza Manager The Insurance Corporation Lim Mui Cheng Tanjong Pagar of Singapore Ltd (Subsidiary) Manager Bukit Timah Janet Mohan GENERAL MANAGERS Manager Thomson Chew Loy Kiat Thomas Hung Manager Leong Teck Kut Buona Vista Ho Hai Yian Manager Wong Seok Chen

44 Toa Payoh Human Resources & New York DBS Finance Ltd, Singapore Manager Planning Agent (Subsidiary) Khoo Sor Hwa Ong Hean Beng Senior Vice-President General Manager Towner Road N Ganesan Deputy Agent Ng Kim Leong Manager Chia Teck Swee Serene Ho Human Resources Assistant General Manager Managers Shu Ting Hoe Woodlands Chia Hock Khee Manager Vice-President Fatimah Lee Tong Chi Lian Managers Alan Loke Osaka Kiat Jin Beow Assistant Vice-Presidents Koh Mui Lee World Trade Centre General Manager Ng Chik Hwa Lee Kheng Leong Manager Kong See Wah Lucy Tan R S Mohan Teresa Boon Teo Ek Kee Manager Nelson Choo Corporate Banking Legal & Secretariat DBS Land Ltd, Singapore Seoul General Manager (Subsidiary) Senior Vice-President Vice-President Long Wil Kim Ng Kee Choe Shirley Loo-Lim General Manager Assistant General Manager Loh Soo Eng Assistant Vice-Presidents Vice-Presidents Seow Kheng Hee Regina Teo Assistant General Managers Chow Kok Kee Lim Joke Mui M N J Vilcassim Manager Can Kim Kok Baek E-Hyun Tan Ah Bah Hong Tuck Kun Koh Soo Boon Planning, Economics, Taipei Senior Manager Kong Chan Wan Lim Kim Quee Research & Public Affairs General Manager Thum Lay Chwan Frank Chu Vice-President Managers Chan Kin Fai Assistant Vice-Presidents Chong Kie Cheong Deputy General Manager Sok Lee S Chandran Cheo Chai Hong Lam Kwong Chew Assistant Vice-Presidents Chua Tik Ngwen Er Sock Kian Heng Hong Ngoh Tokyo Henry Kiong Tay Thiam Hock Tan-Yeoh Chee Koon General Manager Joan Ting-Wong Kuang King Khoong Friedrich Wu Lim Yin Kiat Lee Siang Boon Assistant General Manager Loe Weng Wah Credit Review International S Vijayakumar James Ng Managers Assistant Vice-President Vice-President DBS Securities Singapore Pte Ltd Ho Bee Lian Tan Soon Ann Dolok Saut Tambunan Juichi Takagi (Subsidiary) Finance & Data Resources Assistant Vice-Presidents Shigeyoshi Yamashita Executive Director David Lim Jen Shek Chuen Tan Aik Hong Investment Banking Senior Vice-President Manager Soh Kim Soon Overseas Banking Offices Senior Vice-President Albert Lim Hock Seng Tan Soo Nan Finance & Tax Hong Kong DBS Asia Ltd (Subsidiary) The Insurance Corporation of Vice-Presidents General Manager Vice-President Lee Koek Yong Singapore Ltd, Singapore Tan Bee Leng Neo Poh Kiat Tan Keng Hock (Subsidiary) Manager Data Resources Tan Soon Pin Assistant Vice-Presidents Executive Director/ Eric Ang Chief Executive Vice-Presidents London Irene Fong Lock Sai-Hung Teng-Han Soon Lang General Manager V V Giri General Manager Raymond Wee Wee Guan Lee Esther Lim Yee-Tang Jee Hong (General Division) Deputy General Manager Tan Soek Bee Chew Loy Kiat Assistant Vice-Presidents Chang Lok Meng Cheng Kong Chit Treasury General Manager Managers (Life Division) Ho Fong Lian Leong Teck Kut Lim Lian Lian Edward William Jackson Senior Vice-President Jarrod Ong Sim Nga Hoon Oliver Tan Senior Managers Eugene Sing Los Angeles Vice-Presidents Ng Seng Leong Tan Ham Chiang Agent Chan Mun Seng Magdalene Teoh Peter Tan Koh Kum Loon Manager Assistant Agent Assistant Vice-Presidents Chan Kheng Hua Lum Foo Hong Tan Siew Kheng Wong Peck Sim

45 DBS Bank Offices

HEAD OFFICE SINGAPORE BRANCHES Jurong Branch Tanjong Pagar Branch 2 Corporation Road, #01-02 Block 1, Tanjong Pagar Road 6 Shenton Way, DBS Building Ang Mo Kio Branch NES Building #01-41/44 Tanjong Pagar Plaza Singapore 0106 Block 705, Ang Mo Kio Ave 8 Singapore 2261 Singapore 0208 Tel': 2201111 #01-2573/2575, Singapore 2057 Tel': 2653977 Tel: 2213488 Cable: DBSBANK Tel: 4525556 Telex: RS 24455 Jurong East Branch Thomson Branch Swift Dest: DBSSSGSG Balestier Branch Block 253, Jurong East Avenue 1 301 Upper Thomson Road Facsimile: 2251874 400 Balestier Road, #01-28/38 #01-245/247, Singapore 2260 #01-45.Thomson Plaza Balestier Plaza Tel: 5646622 Singapore 2057 Singapore 1232 Tel: 4547511 Tel: 2553211 Katong Branch 66 East Coast Road, #01-00 Toa Payoh Branch Battery Road Branch GRTH Building Block 187 Toa Payoh Central 9 Battery Road, #01-06 Singapore 1542 #01-346/348, Singapore 1231 Straits Trading Building Tel: 3448344 Tel: 2551422 Singapore 0104 Tel: 2245577 Kent Ridge Branch Towner Road Branch 5 Lower Kent Ridge Road, #01-01 Block 101, Towner Road, #01-238 Bedok Branch National University Hospital Singapore 1232 Block 210,NewUpperChangi Road Singapore 0511 Tel: 2509191 #01-707, Singapore 1646 Tel: 7796877 Tel: 4411122 Woodlands Branch Orchard Road Branch Block 5A Woodlands Centre Road Bukit Timah Branch 68 Orchard Road, #B 1-01/01-15 #01-180, Singapore 2573 1 Jalan Anak Bukit, #01-20 Plaza Singapura Tel: 2691011 Bukit Timah Plaza Singapore 0923 Singapore 2158 Tel: 3362244 World Trade Centre Branch Tel: 4682455 1 Maritime Square, #01-56 Parkway Parade Branch World Trade Centre Buona Vista Branch 80 Marine Parade Road, #01-12 Singapore 0409 Block 43, Holland Drive Singapore 1544 Tel: 2783300 #01-53/59, Singapore 1027 Tel: 3452422 Tel: 7787833 Pickering Branch Clementi Branch Block 3, Upper Pickering Street Block 450, Clementi Ave 3 #01-25, Singapore 0105 #01-293/295, Singapore 0512 Tel: 5324373 Tel: 7775788 Queensway Branch Crawford Branch Block 123, Bukit Merah Lane 1 Block 465, Crawford Lane #01-78 Alexandra Village #01-04/06, Singapore 0719 Singapore 0315 Tel: 2930077 Tel: 2736100

Goldhill Branch Raffles City Branch Goldhill Centre, #01-175 (to open in third quarter of 1986) Thomson Road, Singapore 1130 252 North Bridge Road, #01-11/12 Tel: 2500833 Raffles City Shopping Centre Singapore 0617 Havelock Branch Block 51, Chin Swee Road Rochor Branch #01-107/113, Singapore 0316 Rochor Road, #01-544 Tel: 917277 Rochor Centre Singapore 0718 Hougang Branch Tel: 2930714 Block 204, Hougang Street 21 #01-107/111, Singapore 1953 Shenton Way Branch Tel: 2823388 6 Shenton Way, DBS Building Singapore 0106 Tel: 2201111 Tampines Branch Block 139, Tampines Street 11 #01-44/48, Singapore 1852 Tel: 7821133

46 INTERNATIONAL United Kingdom OFFICES London Branch Hong Kong (Licensed Deposit-Taker) 2nd Floor, 19/21 Moorgate DBS Asia Ltd London EC2R 6BU (wholly-owned subsidiary) United Kingdom 20th Floor, Far East Finance Centre Tel: 01-628-8541 16, Harcourt Road Telex: 291711 DBSLDN G Hong Kong Facsimile: 005-44-1-5883203 Tel: 5-291720 Cable: DBSASIALTD United States of America Telex: 75389 DBSHK HX Facsimile: 005-852-5-292394 Los Angeles Agency Suite 1010, ManuLife Plaza Hong Kong Representative 515 South Figueroa Street Office Los Angeles CA 90071 20th Floor, Far East FinanceCentre United States of America 16, Harcourt Road Tel: (213)-627-0222 Hong Kong Telex: 4720760 DBSLA Tel: 5-291720 Cable: DBSASIALTD New York Agency Telex: 75389 DBSHK HX Suite 9057, One World Trade Center Facsimile: 005-852-5-292394 New York NY 10048 United States of America Japan Tel: (212)-839-9031 Telex: 235607/429656 DBS NY UR Osaka Branch Facsimile: 005-1-212-9380523 9F, Sanei Building Swift: DBSSUS33 6 Unagidani Nishino-cho Minami-ku Osaka 542 Tel: (06) 281-0381 Telex: J522-4776 DBSOSA Facsimile: 005-81-6-2430086

Tokyo Branch 708 Yurakucho Denki Building 7-1 Yurakucho, 1-Chome Chiyoda-ku, Tokyo, 100 Japan Tel: (03)-213-4411 Cable: DBSPORE Telex: J25869 DBS TOKYO Swift: DBSSJPJT Facsimile: 005-81-3-2134415 Republic of China

Taipei Branch 214, Tun Hwa North Road Tun Hwa Financial Building Taipei City, Taiwan Republic of China Tel: (02)-713-7711 Cable: DBSBANK TAIPEI Telex: 13064 and 13066 DBS TPE Facsimile: 005-886-2-713-7774 Republic of Korea

Seoul Branch KPO Box 394 14th Floor, Kyobo Building Chongro 1-ka Chongro-ku, Seoul Republic of Korea Tel: 732-9311/6 Telex: K22764 DBSEOUL Facsimile: 005-82-2-7327953

47 Subsidiaries and Associated Companies

FINANCIAL DBS Securities Nominees Singapore Factory ICS Reinsurance Pte Ltd SUBSIDIARIES Pte Ltd Development Ltd 80 Marine Parade Road, #17-00 Parkway Parade (wholly-owned) (wholly-owned) Singapore 1544 DBS Finance Ltd 6 Shenton Way, DBS Building 6 Shenton Way, DBS Building Tel: 3458555 (wholly-owned) Singapore 0106 Singapore 0106 Cable: INSCOR SINGAPORE Tel: 2201111 Tel: 2201111 6 Shenton Way, #02-07 Telex: RS 37770 Cable: DBSBANK Cable: DBSBANK Principal Activities: Reinsurance DBS Building, Singapore 0106 Telex: RS 24455 Telex: RS 24455 Tel: 2230355 Principal Activities: Nominee Principal Activities: Group Cable: DBSBANK Services Financing National Discount Company Telex: RS 24455 Facsimile: 2251874 Ltd Principal Activities: Finance DBS Securities Singapore The Insurance Corporation 6 Shenton Way, #38-01/02 Company DBS Building Pte Ltd of Singapore Ltd Singapore 0106 (wholly-owned) 80 Marine Parade Road, #17-00 Tel: 2205544 DBS Investment Research 6 Shenton Way, #06-27 Parkway Parade Telex: RS 22553 Singapore 1544 Pte Ltd DBS Building Principal Activities: Discount Singapore 0106 Tel: 3458555 Market Operation (wholly-owned) Tel': 2259677 Cable: INSCOR SINGAPORE 6 Shenton Way, DBS Building Cable: DBSBANK Telex: RS 37770 Singapore 0106 Telex: RS 20438 Facsimile: 3447719 Network for Electronic Tel: 2201111 Facsimile: 2256684 Principal Activities: General and Transfers (S) Pte Ltd Cable: DBSBANK Principal Activities: Life Insurance 10 Shenton Way, #11-06 Telex: RS 24455 Stockbroking Company MAS Building Principal Activities: Research The Insurance Corporation Singapore 0207 Services Tel: 2257222 DBS Trading Pte Ltd of Singapore (UK) Ltd Telex: RS 42191 NETS Three Quays Principal Activities: Marketing DBS Nominees Pte Ltd (wholly-owned) 6 Shenton Way, DBS Building Tower Hill & Operating Electronic Fund (wholly-owned) Singapore 0106 London EC3R 6DS Transfer at Point-of-sale Facility 6 Shenton Way, DBS Building Tel: 2201111 United Kingdom Singapore 0106 Tel: 01-6211727 Cable: DBSBANK Orient Leasing Singapore Tel: 2201111 Telex: RS 24455 Telex: 892454 Cable: DBSBANK Principal Activities: Gold Facsimile: 01-6233318 Ltd Telex: RS 24455 Trading, Financial Futures Principal Activities: General 1 Bonham Street, #28-01 Principal Activities: Nominee Trading Insurance and Reinsurance UOB Building Services Singapore 0104 RMCA Holdings Pte Ltd Tel: 912022 DBS Trustee Ltd Telex: OLSPL RS 21117 DBS Pte Ltd 21 Collyer Quay, #07-00 Facsimile: 5330032 (wholly-owned) The Hongkong Bank Building (wholly-owned) 6 Shenton Way, DBS Building Principal Activities: Lease Singapore 0104 Financing 6 Shenton Way, DBS Building Singapore 0106 Tel: 2210022 Singapore 0106 Tel: 2201111 Telex: RS 23044 RMCA Tel: 2201111 Cable: DBSBANK Facsimile: 2246016 RMCA Reinsurance Pte Ltd Cable: DBSBANK Telex: RS 24455 Principal Activities: Investment 21 Collyer Quay, #07-00 Telex: RS 24455 Principal Activities: Trustee Holding Principal Activities: Investment Services The Hongkong Bank Building Holding Singapore 0104 Reinsurance Management Tel: 2210022 General Investment Telex: RS 23044 RMCA DBS Securities Holding Corporation of Asia Pte Ltd Facsimile: 2246016 Management Ltd 21 Collyer Quay, #07-00 Pte Ltd Principal Activities: (wholly-owned) The Hongkong Bank Building Reinsurance (wholly-owned) 6 Shenton Way, DBS Building Singapore 0104 6 Shenton Way, DBS Building Singapore 0106 Tel: 2210022 Singapore 0106 Tel: 2201111 Telex: RS 23044 RMCA Venture Investment Tel: 2201111 Cable: DBSBANK Facsimile: 2246016 Management (S) Pte Ltd Cable: DBSBANK Telex: RS 24455 Principal Activities: Reinsurance 5 Shenton Way, #24-01 Telex: RS 24455 Principal Activities: Investment Management UIC Building Principal Activities: Investment Management Service Singapore 0106 Holding ASSOCIATED FINANCIAL Tel: 2255855 Sapperton Ltd Telex: RS 28805 INSTITUTIONS Principal Activities: Investment (wholly-owned) Management Services 20th Floor, Far East Finance Centre 16, Harcourt Road General Securities Hong Kong Investments Ltd Venture Investment (S) Ltd Tel: 5-291720 6 Shenton Way, DBS Building 5 Shenton Way, #24-01 Cable: DBSASIALTD Singapore 0106 UIC Building Telex: 75389 DBSHK HX Tel: 2201111 Singapore 0106 Principal Activities: Investment Cable: DBSBANK Tel: 2255855 Holding Telex: RS 24455 Telex: RS 28805 Principal Activities: Investment Principal Activities: Investment Holding Company

Heller Factoring (Singapore) Ltd 10 Shenton Way, #14-02 MAS Building Singapore 0207 Tel: 2247700 Telex: RS 23339 48 Principal Activities: Factoring Services REAL ESTATE National Engineering Swiss Club Park Pte Ltd ASSOCIATED REAL SUBSIDIARIES Services Pte Ltd (wholly-owned) ESTATE COMPANY (wholly-owned) 68 Orchard Road, #06-01 68 Orchard Road, #06-01 Plaza Singapura DBS Land Ltd Singapore 0923 Raffles City Pte Ltd Plaza Singapura 68 Orchard Road, #06-03 (wholly-owned) Singapore 0923 Tel: 3363300 68 Orchard Road, #06-01 Tel: 3363300 Cable: DBSLAND Plaza Singapura, Singapore 0923 Plaza Singapura Cable: DBSLAND Telex: RS 40031 Tel: 3387766 Singapore 0923 Telex: RS 40031 Facsimile: 3361204 (CCITT Telex: RS 40031 Tel: 3363300 Facsimile: 3361204 (CCITT Groups 1 & 2) Principal Activities: Real Estate Principal Activities: Real Estate Cable: DBSLAND Groups 1 & 2) Investment Telex: RS 40031 Principal Activities: Real Estate Investment and Development Facsimile: 3361204 (CCITT Investment Groups 1 & 2) Thomson Plaza Pte Ltd Singapore Treasury Principal Activities: Investment Building Pte Ltd Holding Plaza Singapura Pte Ltd (wholly-owned) 6 Shenton Way, #29-01 (wholly-owned) 68 Orchard Road, #06-01 Plaza Singapura DBS Building Cluny Hill Pte Ltd 68 Orchard Road, #06-01 Singapore 0106 Plaza Singapura Singapore 0923 Tel: 3363300 Tel: 2251355 (wholly-owned) Singapore 0923 Telex: RS 22654 THL 68 Orchard Road, #06-01 Tel: 3363300 Cable: DBSLAND Telex: RS 40031 Principal Activities: Real Estate Plaza Singapura Cable: DBSLAND Investment Singapore 0923 Telex: RS 40031 Facsimile: 3361204 (CCITT Tel: 3363300 Facsimile: 3361204 (CCITT Groups 1 & 2) Cable: DBSLAND Groups 1 & 2) Principal Activities: Real Estate Telex: RS 40031 Principal Activities: Real Estate Investment Facsimile: 3361204 (CCITT Investment Groups 1 & 2) Principal Activities: Real Estate Wan Tien Realty Pte Ltd Investment and Development Property Management (wholly-owned) Pte Ltd 68 Orchard Road, #06-01 Plaza Singapura DBS Realty Pte Ltd (wholly-owned) Singapore 0923 (wholly-owned) 68 Orchard Road, #06-01 Teh 3363300 68 Orchard Road, #06-01 Plaza Singapura Cable: DBSLAND Plaza Singapura Singapore 0923 Telex: RS 40031 Singapore 0923 Tel: 3363300 Facsimile: 3361204 (CCITT Tel: 3363300 Cable: DBSLAND Groups 1 & 2) Cable: DBSLAND Telex: RS 40031 Principal Activities: Real Estate Telex: RS 40031 Facsimile: 3361204 (CCITT Investment and Development Facsimile: 3361204 (CCITT Groups 1 & 2) Groups 1 & 2) Principal Activities: Real Estate Principal Activities: Real Estate Management and Consultancy Warehousing Investment Investment and Development Pte Ltd Raffles Centre Pte Ltd (wholly-owned) General Warehousing (wholly-owned) 68 Orchard Road, #06-01 Plaza Singapura Pte Ltd 68 Orchard Road, #06-01 Plaza Singapura Singapore 0923 (wholly-owned) Singapore 0923 Tel: 3363300 68 Orchard Road, #06-01 Cable: DBSLAND Tel: 3363300 Telex: RS 40031 Plaza Singapura Cable: DBSLAND Singapore 0923 Facsimile: 3361204 (CCITT Telex: RS 40031 Groups 1 & 2) Tel: 3363300 Facsimile: 3361204 (CCITT Cable: DBSLAND Principal Activities: Real Estate Groups 1 & 2) Investment Telex: RS 40031 Principal Activities: Real Estate Facsimile: 3361204 (CCITT Investment Groups 1 & 2) Glen Orchid Properties Principal Activities: Real Estate Investment Pte Ltd 21 Collyer Quay, #07-00 The Hongkong Bank Building Ladyhill Pte Ltd Singapore 0104 (wholly-owned) Tel: 2210022 68 Orchard Road, #06-01 Telex: RS 23044 RMCA Plaza Singapura Facsimile: 2246016 Singapore 0923 Principal Activities: Real Estate Tel: 3363300 Investment Cable: DBSLAND Telex: RS 40031 Facsimile: 3361204 (CCITT Groups 1 & 2) Principal Activities: Real Estate Investment and Development

49 Notice Of Annual General Meeting The Development Bank of Singapore Ltd Incorporated in the Republic of Singapore

To: All Shareholders

NOTICE IS HEREBY GIVEN that the Eighteenth Annual General Meeting of the shareholders of the Company will be held in the Board Room, 46th Storey, DBS Building, 6 Shenton Way, Singapore 0106 on Tuesday, 13th May 1986 at 11.00 a.m. to transact the following business:- 1 To receive and consider the Directors' Report and Audited Accounts for the year ended 31st December 1985 and the Auditors' Report thereon. 2 To declare a Second and Final Dividend of 6% less income tax, for the year ended 31st December 1985. 3 To sanction the amount proposed as Directors' Fees. 4 To re-elect the following Directors:- a Mr Chua Kim Yeow b Mr Koh Cher Siang c Mr Wong Hung Khim 5 To re-appoint Messrs Price Waterhouse as Auditors of the Company and to authorise Management to fix their remuneration. 6 As Special Business To consider and, if thought fit, to pass the following Resolution as an ORDINARY RESOLUTION:- "That pursuant to Section 161 of the Companies Act, Cap 185, approval be and is hereby given to the Directors to issue shares in the Company at any time and upon such terms and conditions and for such purposes as the Directors may in their absolute discretion deem fit provided that the aggregate number of shares to be issued pursuant to this Resolution does not exceed 10 per centum of the issued share capital of the Company for the time being." 7 Any other business.

By Order Of The Board

Shirley Loo-Lim (Mrs) Secretary

4th March 1986 Singapore

NOTES: A member of the Company entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and, on a poll, to vote in his stead. However, where a member of the Company is a corporation, its authorised representative or proxy shall also be entitled to vote on a show of hands.

A proxy need not be a member of the Company.

The Instrument appointing a proxy must be deposited at the Company's registered office at 6 Shenton Way, DBS Building, Singapore 0106 at least 48 hours before the time for holding the Meeting.

50 Proxy Form THE DEVELOPMENT BANK OF SINGAPORE LTD

Signature or Common Seal of Shareholder

Please affix 25 cents Revenue Stamp here

NOTES: A member of the Company entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and, on a poll, to vote in his stead. However, where a member of the Company is a corporation, its authorised representative or proxy shall also be entitled to vote on a show of hands. A proxy need not be a member of the Company. If the appointor is a corporation, this proxy must be executed under seal or the hand of its duly authorised officer or attorney. This proxy must be deposited at the Registered Office of the Company, 6 Shenton Way, DBS Building, Singapore 0106, not less than 48 hours before the time for holding the Meeting.

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