Huatai Holds a Press Conference on Business
and Financial Data Consolidation

<中文版>

On December 21, 2005, Huatai Insurance Company (hereinafter referred to as “Huatai”) held a press conference on business and financial data consolidation. Mr. Pei Guang, Deputy Director of Statistical Information Department of China Insurance Regulatory Commission (CIRC); Mr. Wang Zimu ,Chairman & CEO of Huatai;Mr. Elton Chang, Executive Deputy General Manager& Insurance COO of Huatai; Mr. Zheng Xiaocong, Vice President of IBM Greater China; Mr. Shao Kai, Executive Director of UFIDA Software Co., Ltd& President of UFIDA Engineering Co., Ltd.’s attended the conference. More than 70 media in Bejing were present at the conference.

The conference was presided by Mr. Zhang Bojiang, Assistant Deputy General Manager & Secretary of the Board of Directors of Huatai. Mr. Elton Chang, Mr. Zheng Xiaocong and Mr. Shao Kai delivered remarks at the conference.

The live report of the press conferrence is as follows.

On the spot of the press conference on Huatai insurance business and financial data consolidation.	Chairman Wang Zimu, Dr.Pei Guang and Ms. Deng Qunwei, the Secretory of Board of Directors of Sino-pec, were present at the conference.

(Presider, Mr. Zhang Bojiang):

Distinguished Dr. Pei Guang,
distinguished guests,
all the friends from Beijing media,

Good Morning,

I’m the Secretary of the Board of Directors & the Assistant Deputy General Manager of Huatai , and am very honored to preside this press conference. First of all, I’d like to introduce our distinguished guests present at this meeting who are:

Dr. Pei Guang, Deputy Director, Statistical Information Department, CIRC
Mr. Wang Zimu, Chairman & CEO of Huatai,
Mr. Elton Chang, Executive Deputy General Manager & Insurance COO of Huatai,
Mr. Zheng Xiaocong, Vice President of IBM Greater China,
Mr. Shao Kai, Executive Director of UFIDA Software Co., Ltd. and President of UFIDA Engineering Co., Ltd.,
Mr. Song Mingsan,Yankuang, Investment Corporation’s General Manager,
the representatives of Huatai’s shareholders including Sinopec, China State Construction Engineering Corporation, China State Shipping Corporation, the Capital Automobiles Co., Ltd., and the representatives of China National Tobacco Corporation and our other clients as well.
We have also invited reporters of more than 70 media in Beijing.
On behalf of Huatai, I’d like to express our warmly welcome to you all.

It has become a major concern of insurance companies how to improve their competitive capability facing up to the fast-paced internalization and market-orientation of China insurance industry. Huatai has continuously made hard endeavor to improve its own competitive capability. The press conference today is an opportunity we take to inform you all of our remarkable results in reducing business risks and improving corporate competitiveness by refining our information management system. With three years’ efforts, Huatai realized its business and financial data consolidation and real time conversion on July 31, 2005, which has been proved to be successful after several months’ pilot operation. Via the data center in Beijing head office, the human resources, business and financial data can be managed in a comprehensive, timely and centralized way.

However, what kind of system is it? We’d like to invite Mr. Elton Chang, Executive Deputy General Manage& Insurance COO of Huatai to make a brief introduction.

(Elton Chang, Executive Deputy Manager & Insurance COO of Huatai): When I joined Huatai, I wondered why meetings were frequently held in the meeting room beside my office and why the meetings were attended by people from all departments as well as experts from IBM, UFIDA and ACE Group. I was told that those meetings were held for studying Huatai’s business and financial data consolidation project, which started three years ago. With three years’ endeavor, Huatai successfully completed the Business and Financial Data Consolidation and Real-time Conversion Project on July 31, 2005. All the business and financial data, which were decentralized in 17 branches’ systems in the past have been consolidated in the data center in Beijing head office. As early as 2003, Huatai realized the centralization of human resources data. Huatai’s Business and Financial Data Consolidation and Real-time Conversion Project is a highly complicated and hard to implement one. Huatai senior management has attached great importance and concern to this project. Lots of money and manpower were invested. Almost all the departments and branches were involved in the project. Besides, about 18 external consultants joined the project. For example, IBM, our long-term partner joined the development and implementation of People Soft system; UF Soft, our strategic partner, joined the development and implementation of the billing and reinsurance system. Therefore, it was a great challenge to Huatai to realize good coordination, communication and management. It turned out that Huatai succeeded in the test and a remarkable management team has been formed. After data centralization, Huatai has cancelled the original data centers of branches. All branches’ business, financial and human resources data processing has realized real-time conversing and simultaneous operation with the Beijing-based national data center through computer and trans-regional computer network. Any business data once is input in the system, will be automatically processed in underwriting, claims, or reinsuring, billing and ultimate financial reporting. The management can check the real-time business, financial and human resources data of all the branches at any time. Some business that could be realized in the former decentralized systems, such as key clients’ trans-regional underwriting and claims, co-insurance business of different branches, nation-wide underwriting and claims service can be fulfilled under the present centralized system. Data centralization has brought great convenience to our clients and help to enhance our competitiveness. Huatai will accelerate its speed of information construction rather than rest content with its existing achievements. Now, we have put the focus of our work on the construction of a client-focused IT platform and the relevant aspects, including the promotion of the relevant core service systems’ functions, the exploration of data and the management and control of risks after data center consolidation. To be definite, we will lay particular stress on the transformation of the functions of call center and business insurance systems, the improvement of data warehouse and the construction of a disaster recovery system for the purpose of strengthening Huatai’s core competitive edges and providing our clients with satisfactory service.

Thank you, Mr. Chang.

Mr. Chang has just introduced the content, process and significance of the data consolidation project. The implementation of the project has showed Huatai management’s courage, intelligence, self-confidence and determination.

To realize a fast development by using modern technologies is important for Huatai’s development and innovation, which could not succeed without strong technical support. IBM has always taken a global leading position in IT aspect and has never failed to provide us with strong technical support since the establishment of Huatai. As one of our trustworthy partners, IBM is the main service provider for the data consolidation project. Now, let’s invite Mr. Zheng Xiaocong, Vice President of IBM Greater China to make remarks.

(Zheng Xiaocong, Vice President of IBM Greater China): It’s a pleasure for me to attend this press conference and share with you all here Huatai’s success in information construction. This conference is actually also a victory celebration for the advancement of Huatai’s business to a new stage due to the promotion in information construction. We see that the success of Huatai’s data consolidation project has made Huatai become China’s first insurance enterprise that has successfully realized insurance business and financial data consolidation and real-time conversion throughout the country. At the same time, Huatai’s success has also pointed out a new orientation for the development of the domestic insurance industry and thereby has a huge demonstrative significance. Huatai has rich experience of IT application in the insurance industry. IBM’s mature software and hardware platforms and rich industrial experience will provide a reliable platform for Huatai’s further development of products and service. The cooperation between Huatai and IBM for joint expansion in the insurance industry is a natural association between strong enterprises. We believe that Huatai’s rich experience in operation, quality service and advanced IT solutions will certainly enable it to take a leading position in the insurance industry. Thank you.

(Presider, Mr. Zhang Bojiang):

Thank you, Mr. Zheng.

From Mr. Zheng’s remarks, we can learn more about IBM’s capability in IT service for the insurance industry. His speech also proves that our choice of service provider is correct. We believe that IBM will certainly provide more excellent service for and contribute more to the information construction of Huatai, as well as China’s insurance industry.

Another important participant’s in Huatai’s data consolidation project is UFIDA Engineering Co., Ltd., who played an important role in the process of this project. Now, I would like to give the floor to (let’s invite) UFIDA Software Co., Ltd.’s Executive Director and UFIDA Engineering Co., Ltd.’s President Mr. Shao Kai (to make a speech).

(Shao Kai, UFIDA Software Co., Ltd.’s Executive Director and UFIDA Engineering Co., Ltd.’s President): First, on behalf of UFIDA Group and UFIDA Engineering Co., Ltd., I’d like to congratulate Huatai on the commissioning of its new financial system and the realization of its insurance and financial data consolidation and real-time docking. The success of the project is of great significance for Huatai. For the current Huatai, standardized data have become a strategic resource for the enterprise to carry out operation and management. Meanwhile, the success of the project has made things very easy for Huatai’s clients and strengthened Huatai’s competitiveness on the market. Our customer Huatai is one of the fully reinforced insurance companies and the most courageous insurance company in China. Huatai’s foreign investor is one of the leading American insurance companies. We may say that Huatai has created a miracle in the IT construction of China’s domestic insurance industry. The success of the data center consolidation project symbolizes Huatai has reached a very high level in IT construction and IT project management. Once again, I want to thank you all for your presence here and wish we could jointly spend a memorable day. Thank you.

(Presider, Mr.Zhang Bojiang):　　

Thank you, Mr. Shao.

Mr. Shao has spoken highly of Huatai’s data consolidation from technically angle. As Mr. Shao said just now, UFIDA feels Huatai is the most courageous insurance company. Thank you for your observation. I believe that it would be proved in the future. From Mr. Shao’s speech we have also learnt more about UFIDA. Here, I’d like to say that the cooperation between Huatai and UFIDA has always been smooth and pleasant over the past years. Huatai is very grateful to UFIDA for its cooperative spirit.

In particular, we want to thank China Insurance Regulatory Commission (CIRC), especially the officials of CIRC Statistical Information Department. It’s under their diligent instruction and vigorous promotion that the information construction of China’s insurance industry has been unfolded. Today, Dr. Pei Guang, Deputy Director of CIRC Statistical Information Department, is also present here, indicating his support and affirmation to our work. Now, let’s invite Dr. Pei Guang to make a speech.　　　　

(Dr. Pei Guang, Deputy Director of CIRC Statistical Information Department): It’s a pleasure for me to attend Huatai’s press conference on its data consolidation today. After three years of hard work, Huatai Insurance Company has completed its insurance business and financial data consolidation and realized the real-time data docking. This achievement has made Huatai realize development by leaps in the aspects of statistics and information construction, risk control and business management, enabled Huatai to take a leading position in China’s insurance industry, and laid a solid foundation for Huatai’s more rapid and efficient development in the future. From an industrial point of view, the realization of data consolidation is also a significant innovation in the management of the insurance industry. Hereby, on behalf of the Statistical Information Department of CIRC, I want to extend our warm congratulations to Huatai. In the past over three years, CIRC has paid great attention to the work of information construction and data management and always taken the strengthening of information construction as an important means for promoting the development of the insurance industry and preventing industrial risks. CIRC has also proposed to take the level of a company’s information construction as an important criterion for evaluating the company’s core competitive edges. You may know that data consolidation is a very important task in information construction. Before the realization of data consolidation, a company’s data are scattered in various branches. Such a state is unfavorable for the company’s integration of information and resources, unfavorable for the company’s realization of matched management of assets and liabilities, and unfavorable for the company’s realization of scientific accounting analysis. Therefore, CIRC has vigorously advocated and promoted consolidated data management and put forth definite requirements in this aspect. more>>

(Presider, Mr. Zhang Bojiang):　　

Thank you, Dr. Pei.

From the angle of an official supervisor of China’s insurance industry, Dr. Pei Guang fully affirms Huatai’s data consolidation project and holds Huatai’s implementation of the project is a significant management innovation in the insurance industry. This is the greatest encouragement and impetus for us. We will continuously carry out exploration and innovation to improve the our quality, provide our clients with the best service and make Huatai become an excellent brand in China’s insurance industry.

As you all know, It is more than nine years since Huatai was founded. (has established for nines years. Since its extablishment,) For the nine years, with the guidance of CIRC, the support of all our shareholders and clients, as well as our own endeavor. Huatai become the only insurance company which has achieved profits and distributed dividends to shareholders in nine consecutive years Nowadays, Huatai has entered a period of pursuing for fine management, excellent quality and famous brand. One month ago, Huatai entrusted all the responsibilities for the collection, keeping and clearing of its insurance funds to the Industrial and Commercial Bank of China, becoming the first and the only insurance company that implements the full-process and full-amount trust of insurance funds in China’s insurance industry. This move has enabled Huatai to control the risks of insurance fund operation from the source, greatly increased the safety and service efficiency of funds and won high commendation from CIRC and China Banking Regulatory Commission. Building up Huatai’s brand and trying to grow to be the best from the excellent are our persistent goals. We will adhere to the principle of “intensive management, specialized operation and quality and development with quality and profitability”. We also wish to get support from you all here during our development in the future. Hereby, on behalf of Huatai, I would like to express our sincere gratitude to you.

Dear friends,
The busy and splendid year 2005 will come to the end and a more challenging year 2006 is coming soon. At the junction of the Old Year and the New Year, please allow me to, on behalf Huatai’s management and employees as well as Mr. Zheng from IBM and Mr. Shao from UFIDA, extend our early New Year’s greetings to you. We wish you all a happy holiday and much more happiness in the New Year. We also wish you and your families good health, happiness and success in carrier.
Thank you.