THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this Circular or as to the action you should take, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Limited, you should at once hand this Circular and the accompanying Form of Proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Limited take no responsibility for the contents of this Circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular.

PROPOSALS RELATING TO GENERAL MANDATES TO ISSUE SHARES AND TO REPURCHASE SHARES, RE-ELECTION AND ELECTION OF DIRECTORS, AND REMUNERATION OF DIRECTORS AND NOTICE OF 2011 AGM

Hang Seng Bank Limited (Incorporated in Hong Kong with limited liability) (Stock Code: 11)

The notice convening the 2011 AGM of the Bank to be held at Hang Seng Bank Headquarters, 83 Des Voeux Road Central, Hong Kong on Friday, 13 May 2011 at 3:30 pm, at which, among others, the proposals relating to general mandates to issue Shares and repurchase Shares of the Bank will be considered, is set out on pages 12 to 14 of this Circular.

The action to be taken by Shareholders is set out on page 5 of this Circular. Whether or not you propose to attend the 2011 AGM, you are requested to complete and return the Form of Proxy to the Bank’s Registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not later than 3:30 pm on Wednesday, 11 May 2011 or not less than 48 hours before the time appointed for holding any adjourned meeting (as the case may be). Such Form of Proxy can also be downloaded from the Bank’s website (www.hangseng.com) or HKEX’s website (www.hkexnews.hk). Submission of a Form of Proxy will not preclude a Shareholder from attending and voting in person at the 2011 AGM.

30 March 2011 DEFINITIONS

In this Circular, unless the context otherwise requires, the following expressions have the following meanings: “2011 AGM” the annual general meeting of the Bank to be held on Friday, 13 May 2011 at 3:30 pm at Hang Seng Bank Headquarters, 83 Des Voeux Road Central, Hong Kong or any adjournment thereof “AGM” annual general meeting the “Bank” or “Company” Hang Seng Bank Limited, a company incorporated in Hong Kong with limited liability, the shares of which are listed on the Stock Exchange (Stock Code: 11) “Board” or “Directors” the Board of Directors of the Bank “Committees” the Board committees established by the Board from time to time “Companies Ordinance” the Companies Ordinance, Chapter 32 of the Laws of Hong Kong “corporate communications” any document(s) issued or to be issued by the Bank for the information or action of any holders of its securities, including but not limited to (a) the directors’ report and annual accounts together with a copy of the auditor’s report and, where applicable, a summary financial report; (b) the interim report and, where applicable, a summary interim report; (c) a notice of meeting; (d) a listing document; (e) a circular; and (f) a form of proxy “HKEX” Hong Kong Exchanges and Clearing Limited “Hong Kong” the Hong Kong Special Administrative Region of The People’s Republic of China “HSBC” The Hongkong and Shanghai Banking Corporation Limited, a wholly owned subsidiary of HSBC Holdings plc (which is incorporated in England with limited liability and the holding company of HSBC Group and the shares of which are listed on the Stock Exchange (Stock Code: 5)) “INED” Independent Non-executive Director of the Bank “Latest Practicable Date” 23 March 2011, being the latest practicable date prior to the printing of this Circular for ascertaining certain information contained herein “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange “NED” Non-executive Director of the Bank “Repurchase Mandate” a general mandate to repurchase Shares on the Stock Exchange representing up to 10% of the aggregate nominal amount of the issued share capital of the Bank as at the date of passing the resolution for approving the Repurchase Mandate “SFO” the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong “Share(s)” fully paid Ordinary Share(s) at a nominal value of HK$5.00 each in the share capital of the Bank “Shareholder(s)” holder(s) of the Shares “Stock Exchange” The Stock Exchange of Hong Kong Limited “Takeovers Code” the Hong Kong Codes on Takeovers and Mergers — 1 — letter from the chairman

Hang Seng Bank Limited (Incorporated in Hong Kong with limited liability)

Directors: Registered Office: Dr Raymond K F Ch’ien GBS, CBE, JP, Chairman* 83 Des Voeux Road Central Mrs Margaret Leung JP, Vice-Chairman and Chief Executive Hong Kong Dr John C C Chan GBS, JP* Dr Marvin K T Cheung GBS, OBE, JP* Ms L Y Chiang* Mr Jenkin Hui* Ms Sarah C Legg# Mr William W Leung BBS, JP Dr Eric K C Li GBS, OBE, JP* Dr Vincent H S Lo GBS, JP# Mr Mark S McCombe OBE# Mrs Dorothy K Y P Sit# Mr Richard Y S Tang BBS, JP* Mr Peter T S Wong JP# Mr Michael W K Wu*

* Independent Non-executive Directors # Non-executive Directors

30 March 2011

To the Shareholders

Dear Sir or Madam

PROPOSALS RELATING TO GENERAL MANDATES TO ISSUE SHARES AND TO REPURCHASE SHARES, RE-ELECTION AND ELECTION OF DIRECTORS, AND REMUNERATION OF DIRECTORS AND NOTICE OF 2011 AGM

INTRODUCTION

The purpose of this Circular is to seek your approval of the proposals to (i) grant to the Board general mandates to issue Shares and to repurchase Shares; (ii) re-elect or elect (as the case may be) the retiring Directors; and (iii) fix the remuneration of Directors, and to provide you with information in connection with such proposals. Shareholders’ approval on such proposals will be sought at the 2011 AGM.

GENERAL MANDATES TO ISSUE SHARES AND TO REPURCHASE SHARES

Similar to the AGM of the Bank held on 14 May 2010, ordinary resolutions will be proposed at the 2011 AGM to grant general mandates to the Board (i) to repurchase

— 2 — letter from the chairman

Shares on the Stock Exchange of up to 10% of the aggregate nominal amount of the issued share capital of the Bank as at the date of passing the resolution for approving the relevant mandate, and (ii) to allot, issue and otherwise deal with additional Shares up to a limit equal to, where the additional Shares are to be allotted wholly for cash, 5% and, in any other case, 20% of the aggregate nominal amount of the issued share capital of the Bank as at the date of passing the resolution for approving the relevant mandate. The purpose of the general mandate to issue Shares is to enable the Board to issue additional Shares should the need arise (for example, in the context of a transaction which has to be completed speedily). The Board considers it a good corporate governance practice for the Bank to impose a limit of 5% where additional Shares are allotted wholly for cash. The 20% limit to the general mandate to issue additional Shares is imposed pursuant to the Listing Rules. No Shares have been repurchased and no Shares have been allotted, issued or otherwise dealt with pursuant to the general mandates granted by the Shareholders at the last AGM. The Board has no present intention to exercise the general mandates to issue additional Shares or to repurchase Shares.

As at the Latest Practicable Date, the issued share capital of the Bank comprised 1,911,842,736 Shares. On the basis that no further Shares are issued and/or repurchased by the Bank following the Latest Practicable Date and up to the date of the 2011 AGM, the Bank would be allowed under the general mandate to issue Shares to allot and issue up to 382,368,547 Shares representing 20% of the aggregate nominal amount of the issued share capital of the Bank as at the date of the 2011 AGM.

Under the terms of the Companies Ordinance and the Listing Rules, the general mandates granted to the Board at 2010 AGM will lapse upon the conclusion of the 2011 AGM, unless renewed at the 2011 AGM. The Board takes the view that it would be in the interests of the Bank and its Shareholders as a whole if the general mandates were renewed. In this connection, resolutions will be proposed to renew these mandates and the explanatory statement giving certain information regarding the Repurchase Mandate as required by the Listing Rules is set out in Appendix I to this Circular.

RE-ELECTION AND ELECTION OF DIRECTORS

In accordance with Articles 100 to 102 of the Bank’s Articles of Association, Dr Raymond K F Ch’ien, Dr Marvin K T Cheung and Mr Jenkin Hui, all of whom were last re-elected by the Shareholders in 2008, will retire by rotation and, being eligible, offer themselves for re- election by the Shareholders at the 2011 AGM.

Further, pursuant to Article 106 of the Bank’s Articles of Association, the following Directors will retire and, being eligible, offer themselves for election by the Shareholders at the 2011 AGM:

Name Date of appointment Ms L Y Chiang 20 September 2010 Mr Michael W K Wu 20 September 2010 Mr Mark S McCombe 14 February 2011 Ms Sarah C Legg 14 February 2011

Particulars of the above mentioned Directors offering for re-election or election (as the case may be) at the 2011 AGM are set out in Appendix II to this Circular.

— 3 — letter from the chairman

REMUNERATION OF DIRECTORS

The current scale of the Directors’ fees of the Bank, which is HKD360,000 per annum for Chairman and HKD280,000 per annum for other NEDs, was recommended by the Board and approved by the Shareholders at the Bank’s AGM held on 24 April 2008.

Having regard to the recent market trend, and the ever demanding regulatory requirements and industry best practices applicable to the Bank which have significantly expanded the responsibilities and commitments of the Bank’s Directors, a resolution will be proposed under Agenda Item No. 3 of the 2011 AGM to increase the fees payable by the Bank to the Chairman and the NEDs to HKD440,000 per annum and HKD340,000 per annum respectively. If approved by the Shareholders, the proposed increase in the fees payable to the Chairman and the NEDs will become effective retrospectively as from 1 January 2011.

The remuneration packages of the Executive Directors are determined with reference to the remuneration policy of the Bank. No Directors’ fees are payable to those Directors who are full time employees of the Bank or its subsidiaries.

In arriving at the above proposal, the Board has considered:

(a) the time and effort that a NED has to spend in discharging his/her duties to the Bank; and

(b) the levels of Directors’ fees paid by other leading financial institutions and listed companies in Hong Kong which are similar in size and nature with those of the Bank.

The proposed increments as aforesaid will make the amount of the Chairman’s fee and the NEDs’ fees comparable to the medians of the fees paid by some other leading financial institutions and listed companies. The difference in the amount of fees payable to the Chairman and NEDs is to reflect the heavier workload and responsibilities of the Chairman, in line with the practice adopted by other major listed companies.

POLL VOTING AT THE 2011 AGM

Pursuant to Rule 13.39(4) of the Listing Rules, all resolutions set out in the notice of the 2011 AGM will be decided by poll at the 2011 AGM. The Chairman of the 2011 AGM will demand a poll on each of the resolutions in accordance with Article 63 of the Bank’s Articles of Association.

Article 69 of the Bank’s Articles of Association provides that on a poll, every Shareholder present in person or by proxy shall have one vote for every Share held by that Shareholder. An explanation of the detailed procedures of conducting a poll will be provided to the Shareholders at the 2011 AGM.

— 4 — letter from the chairman

ACTION TO BE TAKEN

A notice of the 2011 AGM is set out on pages 12 to 14 of this Circular. At the 2011 AGM, the following ordinary resolutions, among others, will be proposed for consideration and approval by the Shareholders to:

(a) grant to the Board a general mandate to allot, issue and deal with additional Shares up to 20% of the aggregate nominal amount of the issued share capital of the Bank as at the date of passing the resolution for approving the said mandate provided that the additional Shares to be allotted by the Board pursuant to this mandate wholly for cash shall not in aggregate exceed 5% of the aggregate nominal amount of the issued share capital; and

(b) grant to the Board the Repurchase Mandate.

A Form of Proxy for use at the 2011 AGM is enclosed with the Annual Report and audited financial statements for the year ended 31 December 2010 of the Bank. Such Form of Proxy can also be downloaded from the Bank’s website (www.hangseng.com) or HKEX’s website (www.hkexnews.hk). Whether or not you intend to attend the 2011 AGM, you are requested to complete the Form of Proxy and return it to the Bank’s Registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not later than 3:30 pm on Wednesday, 11 May 2011 or not less than 48 hours before the time appointed for holding any adjourned meeting (as the case may be). The return of a Form of Proxy will not preclude a Shareholder from attending and voting in person at the 2011 AGM.

RECOMMENDATION

The Board believes that the proposed general mandate to issue Shares and the Repurchase Mandate, re-election and election of Directors, and remuneration of the Directors are in the best interests of the Bank and its Shareholders as a whole. Accordingly, the Board recommends that all Shareholders vote in favour of the resolutions to be proposed at the 2011 AGM.

Yours faithfully

Raymond K F Ch’ien Chairman

— 5 — APPENDIX I EXPLANATORY STATEMENT

This Appendix serves as an explanatory statement, as required by the Listing Rules, and also a memorandum of the terms of a proposed repurchase, as required by section 49BA(3)(b) of the Companies Ordinance, to provide information to Shareholders with regard to the Repurchase Mandate.

1. SHARE CAPITAL

As at the Latest Practicable Date, the issued share capital of the Bank comprised 1,911,842,736 Shares. Subject to the passing of the necessary ordinary resolution and on the basis that no further Shares are issued and/or repurchased prior to the 2011 AGM, exercise in full of the Repurchase Mandate could accordingly result in up to 191,184,273 Shares being repurchased by the Bank from the date of the 2011 AGM until the next AGM to be held in 2012.

2. REASONS FOR REPURCHASES

The Board believes that it is in the best interests of the Bank and its Shareholders as a whole to have a general authority from the Shareholders to enable the Board to repurchase Shares in the market. Such repurchases may, depending on market conditions and funding arrangements at the time, lead to an enhancement of the net asset value of the Bank and/or net assets per Share and/or earnings per Share and will only be made when the Board believes that such repurchases will benefit the Bank and its Shareholders as a whole.

3. FUNDING OF REPURCHASES

Repurchases of Shares will be funded entirely from the Bank’s available cash flow or working capital facilities, and will, in any event, be made out of funds legally available for the repurchase in accordance with the Memorandum and Articles of Association of the Bank and the applicable laws of Hong Kong.

The Board does not propose to exercise the Repurchase Mandate to such an extent as would, in the circumstances, have a material adverse effect on the working capital requirements of the Bank or the gearing levels which, in the opinion of the Board, are from time to time appropriate for the Bank. However, there might be a material adverse effect on the working capital requirements or gearing levels of the Bank (as compared with the position disclosed in the audited financial statements contained in the Annual Report for the year ended 31 December 2010) in the event that the Repurchase Mandate is exercised in full at any time.

4. GENERAL

None of the Directors, nor, to the best of their knowledge having made all reasonable enquiries, any of their associates, have any present intention to sell any Shares to the Bank if the Repurchase Mandate is approved by the Shareholders.

The Board has undertaken to the Stock Exchange that (so far as the same may be applicable) it will only exercise the Repurchase Mandate in accordance with the Listing Rules and the applicable laws of Hong Kong.

— 6 — APPENDIX I EXPLANATORY STATEMENT

The Board is not aware of any consequences which could arise under the Takeovers Code as a consequence of any repurchases pursuant to the Repurchase Mandate. As at the Latest Practicable Date, HSBC beneficially owned Shares representing approximately 62.14% of the issued share capital of the Bank. If the Board was to exercise the Repurchase Mandate in full, the percentage shareholding of HSBC would be increased to approximately 69.05% of the issued share capital of the Bank. Such an increase would not give rise to an obligation to make a mandatory offer under Rule 26 of the Takeovers Code.

No purchase has been made by the Bank of its Shares in the six months prior to the Latest Practicable Date (whether on the Stock Exchange or otherwise).

HSBC, the immediate holding company of the Bank, has undertaken not to sell any Shares to the Bank if the Repurchase Mandate is approved by the Shareholders and exercised by the Board. Save as aforesaid, no connected person (as defined in the Listing Rules) has notified the Bank that he or she has a present intention to sell Shares to the Bank, or has undertaken not to sell any Shares to the Bank, if the Repurchase Mandate is approved by the Shareholders.

5. SHARE PRICES

The highest and lowest prices at which the Shares were traded on the Stock Exchange during each of the previous 12 months were as follows:

Highest Lowest HK$ HK$

March 2010 115.20 107.60 April 2010 110.80 106.80 May 2010 108.50 101.00 June 2010 106.30 101.50 July 2010 107.90 103.80 August 2010 110.80 106.50 September 2010 116.00 106.50 October 2010 118.00 112.90 November 2010 130.60 113.40 December 2010 131.50 125.00 January 2011 133.90 128.00 February 2011 134.40 120.00 1 to 23 March 2011 130.40 120.10

— 7 — APPENDIX II PARTICULARS OF DIRECTORS

Particulars of the retiring Directors subject to re-election or election (as the case may be) at the 2011 AGM are set out below:

Dr Raymond CH’IEN Kuo Fung GBS, CBE, JP Independent Non-executive Chairman Aged 59

Joined the Board since August 2007

Other position held within Hang Seng Group Hang Seng Bank Limited (Note 1) – Member of the Remuneration Committee

Other major appointments CDC Corporation (Note 1) – Chairman CDC Software Corporation (Note 1) – Director China.com Inc (Note 1) – Chairman China Resources Power Holdings Company Limited (Note 1) – INED Convenience Retail Asia Limited (Note 1) – INED Federation of Hong Kong Industries – Honorary President Hong Kong Mercantile Exchange Limited – INED MTR Corporation Limited (Note 1) – Non-executive Chairman Swiss Reinsurance Company Limited (Note 1) – INED The Hongkong and Shanghai Banking Corporation Limited – INED The Hong Kong/European Union Business Cooperation Committee – Chairman The Tianjin Municipal Committee of the Chinese People’s Political Consultative Conference – Member of Standing Committee The Wharf (Holdings) Limited (Note 1) – INED University of Pennsylvania, USA – Trustee

Past major appointments The APEC Business Advisory Council – Hong Kong Member (2004 – 2009) Inchcape plc (Note 1) – INED (1997 – 2009) HSBC Holdings plc (Note 1) – INED (1998 – 2007) HSBC Private Equity (Asia) Limited – Chairman (1997 – 2010) Independent Commission Against Corruption – Chairman of Advisory Committee on Corruption (1998 – 2006) Executive Council of HKSAR Government – Member (1997 – 2002) Executive Council of Hong Kong, then under British Administration – Member (1992 – 1997)

Qualification Doctoral Degree in Economics – University of Pennsylvania, USA

Major awards Chevalier de l’Ordre du Merite Agricole of France (2008) (1999) Commander in the Most Excellent Order of the British Empire (1994) Justice of the Peace (1993)

Dr Marvin CHEUNG Kin Tung GBS, OBE, JP Independent Non-executive Director Aged 63

Joined the Board since May 2004

Other position held within Hang Seng Group Hang Seng Bank Limited (Note 1) – Member of Audit Committee

Other major appointments Airport Authority Hong Kong – Chairman Barristers Disciplinary Tribunal – Member

— 8 — APPENDIX II PARTICULARS OF DIRECTORS

Executive Council of HKSAR Government – Non-official Member HKR International Limited (Note 1) – INED Hong Kong Exchanges and Clearing Limited (Note 1) – INED Hong Kong University of Science and Technology – Chairman of the Council HSBC Holdings plc (Note 1) – INED; Audit Committee member The Tracker Fund of Hong Kong – Chairman of the Supervisory Committee

Past major appointments Limited (Note 1) – INED (2007 – 2009) Independent Commission Against Corruption – Member of Operations Review Committee (2004 – 2009) KPMG Hong Kong – Chairman and Chief Executive Officer (1996 – 2003)

Qualifications Fellow – Hong Kong Institute of Certified Public Accountants Fellow – Institute of Chartered Accountants in England and Wales Doctor of Business Administration (Honours) – Hong Kong Baptist University

Major awards Gold Bauhinia Star (2008) (2000) Officer of the Most Excellent Order of the British Empire (1993) Justice of the Peace (1991)

Ms CHIANG Lai Yuen Independent Non-executive Director Aged 45

Joined the Board since September 2010

Other major appointments Chen Hsong Holdings Limited (Note 1) – Executive Director; Chief Executive Officer Chen Hsong Investments Limited – Director China Shenzhen Machinery Association – Vice-President Directorate Salaries and Conditions of Service of HKSAR Government – Member of Standing Committee Shenzhen Federation of Industrial Economics – Vice-Chairman The Hong Kong University of Science and Technology – Member of the Council The Open University of Hong Kong – Member of the Council The Shenzhen Committee of the Chinese People’s Political Consultative Conference – Member of Standing Committee The Toys Manufacturers’ Association of Hong Kong – Vice-President

Past major appointment Disciplined Services Salaries and Conditions of Service of HKSAR Government – Member of Standing Committee (retired in December 2010)

Qualification Bachelor Degree of Arts – Wellesley College, USA

Major award “Young Industrialist Awards of Hong Kong” by the Federation of Hong Kong Industries (2004)

Mr Jenkin HUI Independent Non-executive Director Aged 67

Joined the Board since August 1994

Other position held within Hang Seng Group Hang Seng Bank Limited (Note 1) – Member of Remuneration Committee

— 9 — APPENDIX II PARTICULARS OF DIRECTORS

Other major appointments Central Development Limited – Director Hongkong Land Holdings Limited – Director Jardine Matheson Holdings Limited – Director Jardine Strategic Holdings Limited – Director Pointpiper Investment Limited – Chief Executive

Ms Sarah Catherine LEGG Non-executive Director Aged 43

Joined the Board since February 2011

Other major appointments The Hongkong and Shanghai Banking Corporation Limited – Chief Financial Officer HSBC Bank Bahamas Limited – President (subject to approval of The Central Bank of Bahamas) HSBC Markets (Bahamas) Limited – President HSBC Securities Investments (Asia) Limited – Director The Hong Kong Society for Rehabilitation – Honorary Treasurer Director of other subsidiaries in HSBC Group

Past major appointments The Hongkong and Shanghai Banking Corporation Limited – Chief Accounting Officer (2006 – 2010) HSBC Holdings plc (Note 1) – Senior Manager, Finance Transformation (2003 – 2006) HSBC Bank plc – Head of Product Control, Global Banking and Markets (1999 – 2003)

Qualifications Master of Arts – King’s College, Cambridge University Fellow – Chartered Institute of Management Accountants Member – Association of Corporate Treasurers

Mr Mark Seumas MCCOMBE OBE Non-executive Director Aged 45

Joined the Board since February 2011

Other major appointments HSBC Holdings plc (Note 1) – Group General Manager The Hongkong and Shanghai Banking Corporation Limited – Chief Executive Officer, Hong Kong HSBC Global Asset Management (Hong Kong) Limited – Chairman and Director HSBC Insurance (Asia) Limited – Director HSBC Jintrust Fund Management Company Limited – Vice-Chairman and Director HSBC Life (International) Limited – Director HKICL Services Limited – Chairman and Director Hong Kong Association of Banks – Member of the Committee Hong Kong Exchanges and Clearing Limited (Note 1) – Member of the Risk Management Committee Hong Kong Interbank Clearing Limited – Chairman and Director Hong Kong Monetary Authority – Member of Banking Advisory Committee

Past major appointments HSBC Trinkaus & Burkhardt AG – Director and Audit Committee Member (2009 – 2010) HSBC Global Asset Management – Global Chief Executive Officer (2007 – 2010) HSBC Private Bank, UK, Channel Islands and Luxembourg – Chief Executive Officer (2006 – 2007) HSBC Private Bank (UK) Limited – Chief Executive (2005 – 2006) HSBC Turkey – Deputy Chief Executive Officer (2003 – 2005) HSBC Republic Bank, France – Chief Executive Officer (2000 – 2003)

— 10 — APPENDIX II PARTICULARS OF DIRECTORS

Qualification Master of Arts – Aberdeen University

Major award Officer of the Most Excellent Order of the British Empire (2006)

Mr Michael WU Wei Kuo Independent Non-executive Director Aged 40

Joined the Board since September 2010

Other major appointments Hongkong Caterers Limited – Executive Director and Company Secretary Hong Kong Retail Management Association – Executive Committee Member Maxim’s Caterers Limited – Chairman and Managing Director The Community Chest of Hong Kong – Board Member

Qualification Bachelor of Science in Applied Mathematics and Economics – Brown University, USA

Major Award “Executive Award” of the DHL/SCMP Hong Kong Business Awards (2008)

Notes:

1 The securities of these companies are listed on a securities market in Hong Kong or overseas.

2 The interests of the retiring Directors in the Shares, if any, within the meaning of Part XV of the SFO as at 31 December 2010 are disclosed in the section “Directors’ and Alternate Chief Executives’ Interests” of the Report of the Directors set out in the Bank’s 2010 Annual Report. Their interests remain unchanged as at the Latest Practicable Date.

3 Some retiring Directors (as disclosed above) are also Directors of HSBC Holdings plc (“HSBC”) and/or its subsidiaries. HSBC, through its wholly owned subsidiaries, has an interest in the Shares under the provisions of Divisions 2 and 3 of Part XV of the SFO, the details of which are disclosed in the section “Substantial Interests in Share Capital” of the Report of the Directors set out in the Bank’s 2010 Annual Report.

4 Save as disclosed above, the retiring Directors (a) have not held any directorships in other publicly listed companies, whether in Hong Kong or overseas, during the last three years; and (b) do not hold any other positions in the Bank and its subsidiaries; and (c) do not have any other relationships with any Directors, senior management or substantial or controlling shareholders of the Bank except that Mr Michael W K Wu’s spouse is the niece of Dr Vincent H S Lo, a Non-executive Director of the Bank.

5 All the retiring Directors (except those Directors who are full time employees of the Bank or its subsidiaries) will receive Directors’ fees in the amounts approved from time to time by the Shareholders at the AGMs of the Bank. The current amounts of Directors’ fees have been determined with reference to market rates, directors’ workload and required commitment. A Director will also receive a fee for duties assigned to and services provided by him/her as Chairman or member of various Committees of the Bank. Such fees have been determined with reference to the remuneration policy of the Bank.

6 The details of the emoluments of the retiring Directors on a named basis are disclosed in Note 19 of the Bank’s Financial Statements as contained in the Bank’s 2010 Annual Report.

7 None of the retiring Directors has signed service contracts with the Bank. However, the Bank’s Articles of Association provide that each Director is required to retire by rotation once every three years and that one- third (or the number nearest to one-third) of the Directors shall retire from office every year at the Bank’s AGM. A Director’s specific term of appointment, therefore, cannot exceed three years. Each retiring Director shall be eligible for re-election or election (as the case may be) at the 2011 AGM of the Bank.

8 Save as disclosed above, none of the retiring Directors has any information which is required to be disclosed under Rules 13.51(2)(h)-(v) of the Listing Rules, and there are no other matters relating to the re-election or election (as the case may be) of the retiring Directors that need to be brought to the attention of the Shareholders.

9 Biographical details of Directors of the Bank are also available on the website of the Bank (www.hangseng.com).

— 11 — NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Annual General Meeting (“AGM”) of the shareholders of Hang Seng Bank Limited (the “Bank” or the “Company”) will be held at Hang Seng Bank Headquarters, 83 Des Voeux Road Central, Hong Kong on Friday, 13 May 2011 at 3:30 pm to transact the following ordinary business: (1) to receive and consider the audited financial statements and the Reports of the Directors and of the Auditor for the year ended 31 December 2010; (2) to re-elect or elect (as the case may be) the following retiring Directors: (a) Dr Raymond K F Ch’ien; (b) Dr Marvin K T Cheung; (c) Ms L Y Chiang; (d) Mr Jenkin Hui; (e) Ms Sarah C Legg; (f) Mr Mark S McCombe; and (g) Mr Michael W K Wu; (3) to fix the remuneration of the Directors; (4) to re-appoint KPMG as Auditor and to authorise the Directors of the Company to fix their remuneration; and, by way of special business, to consider and, if thought fit, pass the following Resolutions as Ordinary Resolutions: (5) “THAT (a) subject to paragraph (b) of this Resolution, the exercise by the Directors of the Company during the Relevant Period of all the powers of the Company to purchase shares of the Company be and is hereby generally and unconditionally approved; (b) the aggregate nominal amount of shares which may be purchased on The Stock Exchange of Hong Kong Limited or any other stock exchange recognised for this purpose by the Securities and Futures Commission of Hong Kong and The Stock Exchange of Hong Kong Limited under the Hong Kong Code on Share Repurchases pursuant to the approval in paragraph (a) of this Resolution shall not exceed 10% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing this Resolution, and the said approval shall be limited accordingly; (c) for the purpose of this Resolution, “Relevant Period” means the period from the date of passing this Resolution until whichever is the earliest of: (i) the conclusion of the next Annual General Meeting of the Company; (ii) the expiration of the period within which the next Annual General Meeting of the Company is required by the Companies Ordinance to be held; and (iii) the revocation or variation of the authority given under this Resolution by ordinary resolution of the shareholders in general meeting.”; and

— 12 — NOTICE OF ANNUAL GENERAL MEETING

(6) “THAT

(a) subject to paragraph (c) of this Resolution, pursuant to Section 57B of the Companies Ordinance, the exercise by the Directors of the Company during the Relevant Period of all the powers of the Company to allot, issue and deal with additional shares in the share capital of the Company and to make or grant offers, agreements and options which might require the exercise of such powers be and is hereby generally and unconditionally approved;

(b) the approval in paragraph (a) of this Resolution shall authorise the Directors of the Company during the Relevant Period to make or grant offers, agreements and options which might require the exercise of such powers after the end of the Relevant Period;

(c) the aggregate nominal amount of share capital allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the Directors of the Company pursuant to the approval in paragraph (a) of this Resolution, otherwise than pursuant to (i) a Rights Issue, (ii) the exercise of rights of subscription or conversion under the terms of any warrants issued by the Company or any securities which are convertible into shares of the Company, (iii) any option scheme or similar arrangement for the time being adopted for the grant or issue to officers and/or employees of the Company and/or any of its subsidiaries of shares or rights to acquire shares of the Company, or (iv) any scrip dividend or similar arrangement providing for the allotment of shares in lieu of the whole or part of a dividend on shares of the Company in accordance with the Articles of Association of the Company, shall not exceed, where the shares are to be allotted wholly for cash, 5% and in any event 20% of the aggregate nominal amount of the issued share capital of the Company as at the date of passing this Resolution, and the said approval shall be limited accordingly; and

(d) for the purpose of this Resolution:

“Relevant Period” means the period from the date of passing this Resolution until whichever is the earliest of:

(i) the conclusion of the next Annual General Meeting of the Company;

(ii) the expiration of the period within which the next Annual General Meeting of the Company is required by the Companies Ordinance to be held; and

(iii) the revocation or variation of the approval given by this Resolution by ordinary resolution of the shareholders in general meeting; and

“Rights Issue” means an offer of shares open for a period fixed by the Directors of the Company to holders of shares of the Company or any class thereof on the register on a fixed record date in proportion to their then holdings of such shares or class thereof (subject to such exclusion or other arrangements as the Directors of the Company may deem necessary or expedient in relation to fractional entitlements or having regard to any

— 13 — NOTICE OF ANNUAL GENERAL MEETING

restrictions or obligations under the laws of, or the requirements of any recognised regulatory body or any stock exchange in, any territory outside Hong Kong).”

By Order of the Board

C C Li Secretary

Hong Kong, 30 March 2011

Notes:

1 A shareholder entitled to attend and vote at the AGM (or at any adjournment thereof) is entitled to appoint one or more proxies to attend and vote instead of the shareholder. A proxy needs not also be a shareholder of the Bank.

2 The Directors of the Bank had declared a fourth interim dividend of HK$1.90 per share for 2010. The Register of Shareholders of the Bank was closed on Tuesday, 15 March 2011 for the purpose of ascertaining shareholders’ entitlement to the fourth interim dividend. The fourth interim dividend will be payable on Wednesday, 30 March 2011 to shareholders on the Register of Shareholders of the Bank on Tuesday, 15 March 2011.

3 Brief biographical details of all the Directors to be re-elected or elected (as the case may be) at the AGM are set out in Appendix II to the Circular of which this notice forms part.

4 Pursuant to Rule 13.39(4) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, all resolutions set out in this notice will be decided by poll at the AGM. Article 69 of the Bank’s Articles of Association provides that on a poll, every shareholder present in person or by proxy shall have one vote for every share held by that shareholder. An explanation of the detailed procedures of conducting a poll will be provided to shareholders at the AGM.

5 If Typhoon Signal No.8 or above is expected to be hoisted or a Black Rainstorm Warning Signal is expected to be in force any time between 11:00 am and 5:00 pm on the date of the 2011 AGM, then the 2011 AGM will be postponed and the Shareholders will be informed of the date, time and venue of the postponed meeting by a supplementary notice, posted on the Bank’s website at www.hangseng.com and the website of Hong Kong Exchanges and Clearing Limited at www.hkexnews.hk.

If Typhoon Signal No.8 or above or a Black Rainstorm Warning Signal is cancelled at or before 11:00 am on the date of the 2011 AGM, and where conditions permit, the 2011 AGM will be held as scheduled.

The 2011 AGM will be held as scheduled when an Amber or Red Rainstorm Warning Signal is in force.

Shareholders should decide on their own whether they would attend the 2011 AGM under bad weather condition bearing in mind their own situations and if they do so, they are advised to exercise care and caution.

6 As at the date hereof, the Board of Directors of the Bank comprises Dr Raymond K F Ch’ien* (Chairman), Mrs Margaret Leung (Vice-Chairman and Chief Executive), Dr John C C Chan*, Dr Marvin K T Cheung*, Ms L Y Chiang*, Mr Jenkin Hui*, Ms Sarah C Legg#, Mr William W Leung, Dr Eric K C Li*, Dr Vincent H S Lo#, Mr Mark S McCombe#, Mrs Dorothy K Y P Sit#, Mr Richard Y S Tang*, Mr Peter T S Wong# and Mr Michael W K Wu*.

* Independent Non-executive Directors # Non-executive Directors

— 14 — THIS CIRCULAR in both English and Chinese is now available in printed form and on the Bank’s website (www.hangseng.com) and HKEX’s website (www.hkexnews.hk).

Shareholders who: A) browse this Circular on the Bank’s website and wish to receive a printed copy; or B) receive this Circular in either English or Chinese and wish to receive a printed copy in the other language version, may send a request form, which can be obtained from the Bank’s Registrar or downloaded from the Bank’s website (www.hangseng.com) or HKEX’s website (www.hkexnews.hk), to the Bank’s Registrar:

Computershare Hong Kong Investor Services Limited 17M Floor, Hopewell Centre 183 Queen’s Road East Wanchai, Hong Kong Facsimile: (852) 2529 6087 Email: [email protected]

If Shareholders who have chosen (or are deemed to have chosen) to read this Circular on the Bank’s website have difficulty in reading or gaining access to this Circular via the Bank’s website for any reason, the Bank will promptly send this Circular in printed form free of charge upon the Shareholder’s request.

Shareholders may change their choice of means of receipt or language of the Bank’s future corporate communications at any time, free of charge, by giving the Bank c/o the Bank’s Registrar reasonable notice in writing or by email to hangseng@computershare. com.hk.

HANG SENG BANK LIMITED 83 Des Voeux Road Central, Hong Kong

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