Hang Seng Bank : Consolidates Two MPF Schemes and Lowers Management Fees of Two Constituent Funds (25 March 2019)

25 March 2019

Hang Seng Consolidates Two MPF Schemes and Lowers

Management Fees of Two Constituent Funds

Hang Seng Bank today announced that the Hang Seng Mandatory Provident Fund - ValueChoice (ValueChoice) will be merged into the Hang Seng Mandatory Provident Fund - SuperTrust Plus (SuperTrust Plus) to create one MPF scheme that offers 20 constituent funds. The Bank also announced a reduction of management fees for two of the constituent funds under SuperTrust Plus.

The scheme consolidation and fee reduction are scheduled to take effect on 1 July 2019, while scheme consolidation is subject to relevant regulatory approval.

Six constituent funds under the current ValueChoice scheme-namely ValueChoice Balanced Fund, Global Equity Fund, ValueChoice US Equity Fund, ValueChoice European Equity Fund, ValueChoice Asia Pacific Equity Fund and Hang Seng China Enterprises Index Tracking Fund-will be established under the SuperTrust Plus. As a result, all constituent funds from both schemes will remain available after the scheme consolidation, providing Hang Seng MPF members with a more diverse choice of constituent fund offerings on one MPF platform to suit their own investment preferences and risk appetite. For the list of constituent funds that will be available under SuperTrust Plus with effect from 1 July 2019, please refer to Appendix I.

Also effective 1 July 2019, Hang Seng MPF will reduce the headline management fees for the European Equity Fund and the North American Equity Fund under SuperTrust Plus scheme from 1.35% to 1.30% per annum of net asset value (NAV). For details of the management fees of the constituent funds under SuperTrust Plus with effect from 1 July 2019, please refer to Appendix II.

Wilson Tang, Head of Insurance at Hang Seng Bank, said: "Hang Seng is committedto providing customers with total retirement planning and protection solutions. With the consolidation of our MPF schemes, our MPF members will enjoy a wider choice of constituent funds and improved MPF service efficiency. This is the seventh time that Hang Seng MPF has lowered its management fees for selected constituent funds since 2007, and reflects of our ongoing efforts to provide an attractive MPF proposition for customers. Going forward, we will continue to review and develop our MPFservices to enhance the customer experience and better meet their retirement needs."

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The impact of the fee reduction on Fund Expense Ratios (FERs) will be applied to the entire 2018/19 SuperTrust Plus financial year. According to figures published by the Fee Comparative Platform of the Mandatory Provident Fund Schemes Authority, as at 28 February 2019, the scheme average FER of SuperTrust Plus was 1.23%-below the average market FER of 1.52%.

For further details on the scheme consolidation and fee reduction, please refer to the information that will be uploaded towww.hangseng.com/empfin late March 2019 and late May 2019 respectively. Customers can also call the Hang Seng MPF Service Hotline [phone] or the Hang Seng MPF Employer Direct 2288 6822.

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About Hang Seng Bank

Founded in 1933, Hang Seng Bank operates around 280 service outlets serving both personal and business customers. The Bank also maintains branches in Macau and Singapore, and a representative office in Taipei.

Established in May 2007, wholly owned subsidiary Hang Seng Bank (China) Limited is headquartered in Pudong, Shanghai, and operates a mainland China network with outlets in the Pearl River Delta, the Yangtze River Delta, the Bohai Rim Region and midwest China.

With total assets of HK$1,571 billion as at 31 December 2018, Hang Seng Bank reported a profit attributable to shareholders of HK$24,211 million for 2018. Hang

Seng Bank is a principal member of the HSBC Group, one of the world's largestbanking and financial services organisations. For further information on Hang Seng Bank, please visit the Bank's website atwww.hangseng.com.

Important notes

• The Hang Seng Mandatory Provident Fund-SuperTrust Plus and ValueChoice are mandatory provident fund schemes.

• You should consider your own risk tolerance level and financial circumstances before making any investment choices. When, in your selection of funds, you are in doubt as to whether a certain fund is suitable for you (including whether it is consistent with your investment objectives), you should seek financial and/or professional advice and choose the fund(s) most suitable for you taking into account your circumstances.

• You should consider your own risk tolerance level and financial circumstances before investing in the MPF Default Investment Strategy. You should note that the DIS constituent funds, namely, the Core Accumulation Fund and the Age 65 Plus Fund, may not be suitable for you, and there may be a risk mismatch between the DIS constituent funds and your risk profile (the resulting portfolio risk may be greater than your risk preference). You should seek financial and/or professional advice if you are in doubt as to whether the DIS is suitable for you, and make the investment decision most suitable for you taking into account your circumstances.

• You should note that the implementation of the DIS may have an impact on your MPF investments and benefits. We recommend that you consult with the Trustee if you have doubts on how you are being affected.

• The Guaranteed Fund under Hang Seng Mandatory Provident Fund-SuperTrust Plus invests solely in an approved pooled investment fund in the form of an insurance policy provided by HSBC Life (International) Limited. The guarantee is also given by HSBC Life (International)

  Limited. Your investments in the Guaranteed Fund, if any, are therefore subject to the credit risks of HSBC Life (International) Limited. Pleaserefer to the 'Warning' section under 'Guaranteed Fund' in Part II - Fund Structure of the 'Principal Brochure' of Hang Seng Mandatory Provident

  Fund-SuperTrust Plus for details of the credit risk.

• The guarantee in the Guaranteed Fund only applies under certain conditions. Please refer to the

  'Guarantee features' section under 'Guaranteed Fund' in Part II - Fund Structure of the 'Principal Brochure' of Hang Seng Mandatory Provident Fund -SuperTrust Plus for full details of the

  guarantee features and Guarantee Conditions, including the guarantee features in the context of payment of benefits in instalments.

• MPF Benefits andAVC Benefits payable on a member's 65th birthday or early retirement on or

  after his/her reaching age 60 can be paid in one lump sum or in instalments, at the member'selection (in such form and on such terms as the Trustee may, to the extent not prohibited by the

  'MPF Ordinance' or General Regulation, prescribe). Please refer to the 'Payment of MPF BenefitsandAVC Benefits' section under 'Payment of benefits' in Part I -Product Information of therelevant 'Principal Brochure' for full details.

• You should not invest based on this news releasealone and should read the relevant 'Principal

  Brochure'.

• Investment involves risks. Past performance is not indicative of future performance. The value of financial instruments, in particular stocks and shares, and any income from such financial instruments, may go down as well as up. For further details including the product features and risks involved, please refer to the relevant 'Principal Brochure'.

• This news release is issued by Hang Seng Bank Limited.

Appendix I

Name of Constituent Fund	Before merger on 1 July 2019		After merger on 1 July 2019
	Available under Hang Seng Mandatory Provident Fund - ValueChoice	Available under Hang Seng Mandatory Provident Fund - SuperTrust Plus	Available under Hang Seng Mandatory Provident Fund - SuperTrust Plus
MPF Conservative Fund	√	√	√*
Global Bond Fund	√	√	√*
Guaranteed Fund	√	√
Age 65 Plus Fund	√	√	√*
Core Accumulation Fund	√	√	√*
Stable Fund	√	√
Balanced Fund	√	√
Growth Fund	√	√
ValueChoice Balanced Fund	√	√*
Global Equity Fund	√	√*
North American Equity Fund	√	√
European Equity Fund	√	√
Asia Pacific Equity Fund	√	√
Hong Kong and Chinese Equity Fund	√	√
Chinese Equity Fund	√	√
ValueChoice US Equity Fund	√	√*
ValueChoice FundEuropeanEquity	√	√*
ValueChoice Asia Pacific Equity Fund	√	√*
Hang Seng Index Tracking Fund	√	√	√*
Hang Seng China Enterprises Index Tracking Fund	√	√*

*The 11 constituent funds under SuperTrust Plus will have the same investment objectives and policies, fee levels, and fees and charges structure as the corresponding constituent funds under ValueChoice prior to the merger.

Appendix II

Available under Hang Seng MPF schemes (before 1 July 2019)^

HangSengMandatory

ProvidentFund-SuperTrustPlusand HangSengMandatory

ProvidentFund-

ValueChoice

Available

under Hang Seng MPF scheme (from 1 Jul 2019)^Name of Constituent Fund

MPF Conservative Fund4

Management Fees1,2,3

(As a percentage of NAV per annum)Current Level (before 1 July 2019)

0.75%

New Level (from 1 July 2019)

0.75%

Global Bond Fund Hang Seng Index Tracking Fund Core Accumulation Fund

0.79%

0.79%Up to 0.755%

0.75%

0.75%

HangSengMandatoryProvidentFund-

SuperTrustPlusHangSengMandatoryProvidentFund-SuperTrustPlus

Age 65 Plus Fund Guaranteed Fund5Stable Fund Balanced Fund Growth FundNorth American Equity Fund

1.275% 1.25% 1.35% 1.45%

1.275% 1.25% 1.35% 1.45%

European Equity Fund

Asia Pacific Equity Fund

Hong Kong and Chinese Equity Fund Chinese Equity Fund ValueChoice Balanced Fund*

1.45%

1.45%

HangSengMandatoryProvident

Fund-ValueChoice

Global Equity Fund* ValueChoice US Equity Fund*

0.79%

0.79%

ValueChoice European Equity Fund* ValueChoice Asia Pacific Equity Fund* Hang Seng China Enterprises Index Tracking Fund*

Up to 0.79%