The strategy for our private equity investment business is to focus on managing client investments, as supplemented by investments with our own funds, and to become an investment manager for third-party funds. We operate our private equity investment business through Galaxy Capital, which was established in October 2009. Galaxy Capital makes direct equity investments with our own funds in private companies that we believe have potential for capital appreciation. In its capacity as an investment manager, Galaxy Capital also makes private equity investments with funds raised from third-party investors.

As of December 31, 2012, we had invested a total of approximately RMB442 million in eight private companies in the manufacturing, consumer goods, telecommunications, culture, and mining industries. Galaxy Capital generally makes direct equity investments as a financial investor and seeks to exit from its investments and capture capital appreciation through share transfers or IPOs.

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