Fund Rating Suspension for the Matthews Asia - Asia Small Companies fund

Following the news that there have been significant redemptions from the Matthews Asia - Asia Small Companies fund this year, reducing assets under management in this investment vehicle to c.$5 million, we have taken the action to suspend our A rating. Although our conviction in the firm, investment manager and fund remain, at its current size the strategy could be deemed to be sub-scale by many investors.

We believe Matthews Asia has managed these divestments in a sensible manner so far and that the manager remains committed to this strategy. We are further comforted by the fact that this fund is managed in an identical manner to a US domiciled fund, which has assets of c.$456m (as at end January 2018).

However, there are clearly areas we would like to explore further, especially regarding how the fund grows from here. As such we we have therefore decided to monitor developments over the coming months.