Sheng Yuan : CONTINUING CONNECTED TRANSACTIONS INVESTMENT ADVISORY AGREEMENTS

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

(Incorporated in Bermuda with limited liability)

(Stock Code: 851)

CONTINUING CONNECTED TRANSACTIONS

INVESTMENT ADVISORY AGREEMENTS

The Board is pleased to announce that, on 14 February 2020, Sheng Yuan Asset Management (a wholly-owned subsidiary of the Company) has entered into the First Investment Advisory Agreement and the Second Investment Advisory Agreement with Yuanyin International and Yuanyin Asset Management, respectively, pursuant to which Sheng Yuan Asset Management will provide investment advisory services to Yuanyin International and Yuanyin Asset Management, respectively.

IMPLICATIONS UNDER THE LISTING RULES

As at the date of this announcement, Yuanyin Holdings held 1,011,000,000 Shares, representing 26.47% of the issued share capital of the Company and is a substantial Shareholder. Each of Yuanyin International and Yuanyin Asset Management is a wholly- owned subsidiary of Yuanyin Holdings, and is therefore each a connected person of the Company. Accordingly, the transactions contemplated under each of the Investment Advisory Agreements constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

As all the applicable ratios are less than 25% and the aggregate advisory fee under the Investment Advisory Agreements is less than HK$10 million, the transactions under the Investment Advisory Agreements are subject to reporting and announcement requirement, but are exempted from the independent shareholders' approval requirement under Chapter 14A of the Listing Rules.

- 1 -

INTRODUCTION

The Board is pleased to announce that, on 14 February 2020, Sheng Yuan Asset Management (a wholly-owned subsidiary of the Company) has entered into the First Investment Advisory Agreement and the Second Investment Advisory Agreement with Yuanyin International and Yuanyin Asset Management, respectively, pursuant to which Sheng Yuan Asset Management will provide investment advisory services to Yuanyin International and Yuanyin Asset Management, respectively.

INVESTMENT ADVISORY AGREEMENTS

The principal terms of the First Investment Advisory Agreement are as follows:

Date:	14 February 2020
Parties:	(1)	Sheng Yuan Asset Management
	(2)	Yuanyin International
Scope of services:	Sheng Yuan Asset Management will provide investment advisory
	services regarding the investment opportunities in respect of the
	Portfolio, including:
	(i)	to provide an analysis of the progress of all Investments within
		the Portfolio;
	(ii)	to render advice on Investments within the Portfolio in the form
		of a research report;
	(iii) to provide advice on matters related to Investments in the
		Portfolio; and
	(iv)	to provide information and assistance as may be required in
		connection with the valuation of any Investments within the
		Portfolio.
Term:	For an initial term of three years commencing from the date of the
	First Investment Advisory Agreement, which may thereafter be
	renewed upon the written agreement between the parties for
	successive three year periods upon each expiry.
Service fees:	Annual service fee of HKD3,905,258.
Time of payment:	The annual service fee shall be payable on or before 31 March of
	each financial year.

- 2 -

On the same date, Sheng Yuan Asset Management and Yuanyin Asset Management entered into the Second Investment Advisory Agreement, pursuant to which Sheng Yuan Asset Management will provide investment advisory services to Yuanyin Asset Management for a term of three months effective from the signing date of the Second Investment Advisory Agreement, with a service fee of HKD1,000,000, payable within 30 day(s) from the date of the Second Investment Advisory Agreement. Save for (i) the term of the agreement; (ii) the amount of the service fee and (iii) the time of payment as disclosed above, the remaining principal terms of the Second Investment Advisory Agreement are identical to the First Investment Advisory Agreement as described above.

PROPOSED ANNUAL CAPS

The Group has not previously engaged in any transaction of provision of investment advisory services to Yuanyin International or Yuanyin Asset Management prior to the entering into of the Investment Advisory Agreements.

The table below sets out the respective proposed annual caps for the Investment Advisory Agreements:

	Year ending		Year ending	Year ending
	31 December		31 December	31 December
	2020	2021	2022
	Proposed		Proposed	Proposed
	annual cap		annual cap	annual cap
	(HKD)		(HKD)	(HKD)
The First Investment Advisory Agreement	3,905,258	3,905,258		3,905,258
The Second Investment Advisory Agreement	1,000,000		-	-
Aggregate Annual Cap
4,905,258		3,905,258	3,905,258

The above proposed annual caps have been determined with reference to the service fees payable pursuant to the respective Investment Advisory Agreements, which in turn have been determined by the parties after arm's length negotiations with reference to (i) the total investment amount of the Portfolios; (ii) the annual advisory fee rate of 2%, which is in line with normal market terms for similar investment advisory services; and (iii) market price and no less favorable than those offered by Independent Third Party.

- 3 -

REASONS FOR AND BENEFITS OF THE INVESTMENT ADVISORY AGREEMENTS

The Directors consider that the entering into of the Investment Advisory Agreements will allow the Group to leverage on the extensive investment advisory experiences of the advisory team at Sheng Yuan Asset Management and is in line with the Company's objective to enhance revenue generated from the investment advisory business of the Group, and diversify its revenue sources.

The Directors (including the independent non-executive Directors) are of the view that the Investment Advisory Agreements have been entered into on normal commercial terms, in the ordinary and usual course of business of the Group, and together with the respective proposed annual caps for the three years ending 31 December 2022, are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Mr. Liu Yang and Mr, Zhou Quan, who are executive Directors, are also a director of Yuanyin Holdings Limited and a managing director of Yuanyin Finance Limited (a wholly- owned indirect subsidiary of the Yuanyin Holdings), respectively. Mr. Zhao Yun, who is the non-executive Director, is the board secretary of Yuanyin Holdings Limited. As such, each of Mr. Liu Yang, Mr, Zhao Quan and Mr. Zhao Yun was deemed to have a material interest in, and they have abstained from voting on, the resolutions passed by the Board to approve the Investment Advisory Agreements and the transactions contemplated thereunder. Save as disclosed above, none of the Directors has any material interest in, or is required to abstain from voting on the resolutions passed by the Board to approve the Investment Advisory Agreements and the transactions contemplated thereunder.

INFORMATION ON THE GROUP, SHENG YUAN ASSET MANAGEMENT, YUANYIN INTERNATIONAL, YUANAYIN ASSET MANAGEMENT AND YUANYIN HOLDINGS

The Group

The Company is an investment holding company incorporated in Bermuda. The Group is principally engaged in the provision of securities brokerage and financial services, asset management services and investment holding.

Sheng Yuan Asset Management

Sheng Yuan Asset Management is a limited liability company incorporated under the laws of Hong Kong. It is principally engaged in the provision of investment advisory and management services and is a corporation licensed by the Securities and Futures Commission to carry on type 4 (advising on securities) and type 9 (asset management) regulated activities. It is a wholly-owned subsidiary of the Company.

Yuanyin International

Yuanyin International is a limited liability company incorporated under the laws of Hong Kong and principally engaged in investment holding. It is a wholly-owned subsidiary of Yuanyin Holdings.

- 4 -

Yuanyin Asset Management

Yuanyin Asset Management is a limited liability company incorporated under the laws of Hong Kong and principally engaged in the provision of asset management services. It is a wholly-owned subsidiary of Yuanyin Holdings.

Yuanyin Holdings

Yuanyin Holdings is a limited liability company incorporated in the British Virgin Islands and principally engaged in investment holding. Yuanyin Holdings does not have controlling shareholders, and is ultimately owned by corporate and individual investors including China First Capital Group Limited, AMTD Group Company Limited, Mr. Jiao Yunlei (焦雲雷), Mr. Ma Baojun (馬寳軍), Mr. Xu Dajiang (許大江), Mr. Zhang Fushun (張付順), Mr. Zhang Chunmin (張春敏), Mr. Huang Shuanggang (黃雙剛), Mr. Liu Zhenjiang (劉鎮江),

Mr. Ma Jie, Mr. Fu Qinglin (付慶林), Mr. Chen Xingming (陳星明) and Mr. Hao Xiaohui (郝曉暉).

IMPLICATIONS UNDER THE LISTING RULES

As at the date of this announcement, Yuanyin Holdings held 1,011,000,000 Shares, representing 26.47% of the issued share capital of the Company and is a substantial Shareholder. Each of Yuanyin International and Yuanyin Asset Management is a wholly- owned subsidiary of Yuanyin Holdings, and is therefore each a connected person of the Company. Accordingly, the transactions contemplated under each of the Investment Advisory Agreements constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

As all the applicable ratios are less than 25% and the aggregate advisory fee under the Investment Advisory Agreements is less than HK$10 million, the transactions under the Investment Advisory Agreements are subject to reporting and announcement requirement, but are exempted from the independent shareholders' approval requirement under Chapter 14A of the Listing Rules.

DEFINITIONS

In this announcement, unless the context otherwise requires, the following expressions have the following meanings:

''Board''	the board of Directors
''Company''	Sheng Yuan Holdings Limited, a company incorporated in
	Bermuda and its shares are listed on the Main Board of the
	Stock Exchange (stock code: 851)
''connected person(s)''	has the meaning ascribed to it under the Listing Rules
''Director(s)''	directors of the Company

- 5 -

''First Investment Advisory Agreement

''Group'' ''HKD'' ''Hong Kong''

''Independent Third Party''

''Investment''

''Investment Advisory Agreements''

''Listing Rules''

''Portfolio''

''Second Investment Advisory Agreement''

''Share(s)''

''Shareholder(s)''

''Sheng Yuan Asset Management''

''Stock Exchange''

''Yuanyin Asset Management''

the investment advisory agreement dated 14 February 2020 entered into between Sheng Yuan Asset Management and Yuanyin International in respect of the provision of investment advisory services

the Company and its subsidiaries

Hong Kong dollars, the lawful currency of Hong Kong

the Hong Kong Special Administrative Region of the People's Republic of China

a person or entity who is not a connected person of the Company

investments in various types of financial products including securities and real estate investment scheme (as defined under Part 1, Schedule 1 of the Securities and Futures Ordinance)

collectively, the First Investment Advisory Agreement and the Second Investment Advisory Agreement

the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited

the portfolio of Investments of Yuanyin International or Yuanyin Asset Management (as the case may be) as set out in the respective Investment Advisory Agreements

the investment advisory agreement dated 14 February 2020 entered into between Sheng Yuan Asset Management and Yuanyin Asset Management in respect of the provision of investment advisory services

the share(s) of the Company

holder(s) of the Share(s)

Sheng Yuan Asset Management Limited, a company incorporated under the laws of Hong Kong and a wholly- owned subsidiary of the Company

The Stock Exchange of Hong Kong Limited

Yuanyin Asset Management Limited, a company incorporated under the laws of Hong Kong and a wholly- owned subsidiary of Yuanyin Holdings

- 6 -

''Yuanyin Holdings''	Yuanyin Holdings Limited, a limited liability company
	incorporated in the British Virgin Islands and a controlling
	Shareholder
''Yuanyin International''	Yuanyin International Limited, a company incorporated
	under the laws of Hong Kong and a wholly-owned
	subsidiary of Yuanyin Holdings
''%''	per cent
	By order of the Board
	Sheng Yuan Holdings Limited
	Liu Yang
	Chairman
Hong Kong, 14 February 2020
As at the date of this	announcement, the Board consists of Mr. Liu Yang and

Mr. Zhou Quan (all being executive Directors), Mr. Mu Hao and Mr. Zhao Yun (all being non-executive Directors), Ms. Fang Fang, Mr. Fung Tze Wa and Mr. An Dong (all being independent non-executive Directors).

- 7 -