UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-06686
JF China Region Fund, Inc.
(Exact name of registrant as specified in charter)
73 Tremont Sreet
Boston, MA 02108
(Address of principal executive offices) (Zip code)
Cleary, Gottlieb Steen & Hamilton
1 Liberty Plaza
New York, NY 10036
(Name and Address of Agent for Service)
Registrant’s telephone number, including area code: (800) 441-9800
Date of fiscal year end: December 31
Date of reporting period: January 1, 2008 through June 30, 2008
ITEM 1. REPORTS TO STOCKHOLDERS.
The following is a copy of the report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1).
![](https://capedge.com/proxy/N-CSRS/0001145443-08-002579/d23577frtcov.jpg)
Objectives | 1 | |||||
Management | 1 | |||||
Forward-Looking Statements | 2 | |||||
Market Information | 2 | |||||
Highlights | 3 | |||||
Chairman’s Statement | 4 | |||||
Investment Advisers’ Report | 5 | |||||
Top Ten Holdings | 8 | |||||
Investment Portfolio | 9 | |||||
Statement of Assets and Liabilities | 11 | |||||
Statement of Operations | 12 | |||||
Statement of Changes in Net Assets | 13 | |||||
Financial Highlights | 14 | |||||
Notes to Financial Statements | 15 | |||||
Results of the Annual Stockholders’ Meeting | 20 | |||||
Other Information | 20 | |||||
Fund Management | 21 | |||||
Dividend Reinvestment and Cash Purchase Plan | 23 | |||||
Directors and Administration | 24 |
• | The Wall Street Journal (daily online at www.WSJ.com/Free) |
• | The Wall Street Journal under “Closed-End Funds” (every Saturday) |
• | www.jfchinaregion.com |
JUNE 30, 2008 US$ (Unaudited) | DECEMBER 31, 2007 US$ (Audited) | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Net Assets | $ | 104.6 | million | $138.6 | million | |||||||||
Net Asset Value Per Share | $ | 22.82 | $30.24 | |||||||||||
Market Data | ||||||||||||||
Share Price on the New York Stock Exchange | $ | 19.85 | $25.47 | |||||||||||
Discount to Net Asset Value | 13.0 | % | 15.8 | % | ||||||||||
Total Return for the Six Months Ended June 30, 2008 (Unaudited) | ||||||||||||||
Net Asset Value | –24.5 | % | ||||||||||||
Share Price | –22.1 | % | ||||||||||||
JFC Benchmark Index* | –19.4 | % | ||||||||||||
MSCI Hong Kong Index (Total) | –22.1 | % | ||||||||||||
MSCI China Index (Total) | –26.3 | % | ||||||||||||
MSCI Taiwan Index (Total) | –5.8 | % |
![](https://capedge.com/proxy/N-CSRS/0001145443-08-002579/d23577line.jpg)
* | JFC Benchmark: MSCI Golden Dragon Index (Total). The MSCI Golden Dragon Index is comprised of 24.1% of the MSCI Hong Kong Index, 42.7% of the MSCI China Index and 33.2% of the MSCI Taiwan Index. Prior to March 2001, 25% Taiwan Weighted Index, 20% BNP Paribas China Index, 50% MSCI Hong Kong, 5% HSBC; Prior to March 1999, 60% Hong Kong All Ordinaries, 30% Credit Lyonnais Securities Asia All China B Index, 10% Taiwan Weighted Index; Prior to January 1997, Peregrine Greater China Index |
** | Commencement of operations Source: JPMorgan Asset Management |
JUNE 30, 2008
Chairman
AT JUNE 30, 2008 (Unaudited)
| % OF NET ASSETS | |||||
---|---|---|---|---|---|---|
China Mobile Ltd. China Mobile, Limited through its subsidiaries, provides cellular telecommunications services in the People’s Republic of China and Hong Kong SAR. | 7.9 | |||||
Taiwan Semiconductor Manufacturing Co., Ltd. (’TSMC’) TSMC manufactures and markets integrated circuits. The Company provides the following services; wafer manufacturing, wafer probing, assembly and testing, mask production and design services. The Company’s integrated circuits are used in computer, communication, consumer electronics, automotive and industrial equipment industries. | 5.6 | |||||
China Construction Bank Corp. ‘H’ China Construction Bank Corporation provides a complete range of banking services and other financial services to individual and corporate customers. The Bank’s services include retail banking, international settlement, project finance and credit card services. | 5.4 | |||||
Cheung Kong Holdings, Ltd. Cheung Kong Holdings, Limited, through its subsidiaries, develops and invests in real estate. The Company also provides real estate agency and management services, operates hotels and invests in securities. | 4.2 | |||||
CNOOC, Ltd. CNOOC, Limited, through its subsidiaries, explores, develops, produces, and sells crude oil and natural gas. | 3.6 | |||||
China Petroleum & Chemical Corp. ‘H’ China Petroleum and Chemical Corporation (’Sinopec’) explores for and produces crude oil and natural gas in China. The Company also owns refineries that make petroleum and petrochemical products such as gasoline, diesel, jet fuel, kerosene, ethylene, synthetic fibers, synthetic rubber, synthetic resins, and chemical fertilizers. In addition, Sinopec trades petrochemical products. | 3.2 | |||||
Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Limited manufactures and markets personal computer (’PC’) connectors and cable assemblies used in desktop PCs and PC servers. | 3.1 | |||||
China Life Insurance Co., Ltd. ‘H’ China Life Insurance Company, Limited offers a wide range of life, accident and health insurance products and services. | 3.1 | |||||
China Merchants Bank Co., Ltd. ‘H’ China Merchants Bank Co., Limited provides a wide range of commercial banking services including deposit, loan, bill discount, government bonds underwriting and trading, interbank lending, letter of credit, bank guarantee, and other related services. | 3.0 | |||||
Chinatrust Financial Holding Co., Ltd. Chinatrust Financial Holding Co., Limited is a holding company. Through its subsidiaries, the Company provides a variety of banking and financial services including deposit, loan, guarantee, International banking, trust banking, credit card, investment banking, safety deposit box, and internet banking services. | 2.9 |
AT JUNE 30, 2008 (Unaudited)
DESCRIPTION | | Holdings (in shares) | | Market Value (in US$) | |||||||
---|---|---|---|---|---|---|---|---|---|---|---|
COMMON STOCKS — (unless otherwise noted) | |||||||||||
CHINA (29.7%) | |||||||||||
Beverages (0.6%) | |||||||||||
Yantai Changyu Pioneer Wine Co. ‘B’ | 104,623 | 657,479 | |||||||||
Commercial Banks — (8.4%) | |||||||||||
China Construction Bank Corp. ‘H’ | 6,950,000 | 5,597,615 | |||||||||
China Merchants Bank Co., Ltd. ‘H’ | 1,007,000 | 3,164,128 | |||||||||
8,761,743 | |||||||||||
Construction & Engineering (0.7%) | |||||||||||
China Railway Construction Corp. ‘H’ (a) | 551,000 | 777,325 | |||||||||
Construction Materials (1.3%) | |||||||||||
Asia Cement China Holdings Corp. (a) | 970,000 | 625,746 | |||||||||
China National Building Material Co., Ltd. ‘H’ | 382,000 | 734,875 | |||||||||
1,360,621 | |||||||||||
Health Care Equipment & Supplies (0.0%) | |||||||||||
Health Asia Medicentres (a) † † | 1,000,000 | — | |||||||||
Hotels, Restaurants & Leisure (0.7%) | |||||||||||
Ajisen China Holdings, Ltd. | 189,000 | 188,340 | |||||||||
Ctrip.com International, Ltd. ADR | 12,167 | 557,005 | |||||||||
745,345 | |||||||||||
Insurance (3.1%) | |||||||||||
China Life Insurance Co., Ltd. ‘H’ | 914,000 | 3,200,128 | |||||||||
Internet Software & Services (1.5%) | |||||||||||
Tencent Holdings, Ltd. | 194,800 | 1,506,485 | |||||||||
Marine (1.9%) | |||||||||||
China Shipping Container Lines, Co., Ltd. ‘H’ | 2,388,000 | 934,098 | |||||||||
China COSCO Holdings, Co., Ltd. ‘H’ | 421,300 | 1,028,767 | |||||||||
1,962,865 | |||||||||||
Metals & Mining (0.6%) | |||||||||||
Zijin Mining Group Co., Ltd. (a) | 790,000 | 671,737 | |||||||||
Multiline Retail (1.1%) | |||||||||||
Parkson Retail Group, Ltd. | 150,000 | 1,094,616 | |||||||||
Oil, Gas & Consumable Fuels (5.7%) | |||||||||||
China Petroleum & Chemical Corp. ‘H’ | 3,624,000 | 3,392,888 | |||||||||
China Shenhua Energy Co., Ltd. ‘H’ | 655,000 | 2,570,522 | |||||||||
5,963,410 | |||||||||||
Real Estate Management & Development (2.9%) | |||||||||||
China Vanke Co., Ltd. ‘B’ | 1,833,360 | 2,339,534 | |||||||||
Guangzhou R&F Properties Co., Ltd. ‘H’ | 395,200 | 736,953 | |||||||||
3,076,487 | |||||||||||
Software (0.5%) | |||||||||||
Perfect World Co., Ltd. ADR (a) | 21,038 | 525,740 | |||||||||
Specialty Retail (0.7%) | |||||||||||
Belle International Holdings, Ltd. | 857,000 | 771,572 | |||||||||
TOTAL CHINA | 31,075,553 | ||||||||||
HONG KONG (37.3%) | |||||||||||
Airlines (0.8%) | |||||||||||
Cathay Pacific Airways, Ltd. | 413,000 | 787,095 | |||||||||
Commercial Banks (3.9%) | |||||||||||
BOC Hong Kong Holdings, Ltd. | 220,500 | 583,966 | |||||||||
Dah Sing Financial Holdings, Ltd. | 79,600 | 642,129 | |||||||||
Hang Seng Bank, Ltd. | 136,800 | 2,886,095 | |||||||||
4,112,190 | |||||||||||
Diversified Financial Services (1.2%) | |||||||||||
Hong Kong Exchanges & Clearing, Ltd. | 89,300 | 1,305,614 | |||||||||
Diversified Telecommunication Services (1.7%) | |||||||||||
China Netcom Group Corp Hong Kong, Ltd. | 643,500 | 1,753,743 | |||||||||
Electric Utilities (1.5%) | |||||||||||
Cheung Kong Infrastructure Holdings, Ltd. | 383,000 | 1,620,956 | |||||||||
Independent Power Producers & Energy Traders (1.0%) | |||||||||||
China Resources Power Holdings Co. | 432,000 | 1,052,679 | |||||||||
Investment Company (1.9%) iShares Asia Trust — iShares FTSE/Xinhua A50 China Tracker (exchange traded fund) (a) | 1,050,800 | 1,940,623 | |||||||||
Leisure Equipment & Products (1.0%) | |||||||||||
Li Ning Co., Ltd. | 453,500 | 1,046,908 | |||||||||
Multiline Retail (0.4%) | |||||||||||
Lifestyle International Holdings, Ltd. | 317,000 | 445,583 | |||||||||
Oil, Gas & Consumable Fuels (3.6%) | |||||||||||
CNOOC, Ltd. | 2,192,000 | 3,772,694 |
AT JUNE 30, 2008 (Unaudited) (continued)
DESCRIPTION | | HOLDINGS (IN SHARES) | | MARKET VALUE (IN US$) | |||||||
---|---|---|---|---|---|---|---|---|---|---|---|
COMMON STOCKS — continued | |||||||||||
Real Estate Management & Development (10.3%) | |||||||||||
Cheung Kong Holdings, Ltd. | 324,000 | 4,367,232 | |||||||||
Great Eagle Holdings, Ltd. | 171,000 | 504,409 | |||||||||
Hang Lung Properties, Ltd. | 438,000 | 1,404,341 | |||||||||
Kerry Properties, Ltd. | 252,800 | 1,327,668 | |||||||||
Sun Hung Kai Properties, Ltd. | 138,000 | 1,872,507 | |||||||||
Wharf Holdings, Ltd. | 303,000 | 1,268,774 | |||||||||
10,744,931 | |||||||||||
Specialty Retail (1.3%) | |||||||||||
Esprit Holdings, Ltd. | 133,200 | 1,383,719 | |||||||||
Wireless Telecommunication Services (8.7%) | |||||||||||
China Mobile, Ltd. | 615,500 | 8,272,711 | |||||||||
Hutchison Telecommunications International, Ltd. (a) | 581,000 | 824,119 | |||||||||
9,096,830 | |||||||||||
TOTAL HONG KONG | 39,063,565 | ||||||||||
TAIWAN (32.1%) | |||||||||||
Chemicals (2.1%) | |||||||||||
Formosa Plastics Corp. | 566,000 | 1,364,979 | |||||||||
Taiwan Fertilizer Co., Ltd. | 213,000 | 799,987 | |||||||||
2,164,966 | |||||||||||
Commercial Banks (4.7%) | |||||||||||
Chinatrust Financial Holding Co., Ltd. (a) | 3,155,000 | 3,045,547 | |||||||||
First Financial Holding Co., Ltd. | 1,720,000 | 1,886,996 | |||||||||
4,932,543 | |||||||||||
Computers & Peripherals (3.1%) | |||||||||||
Acer, Inc. | 739,000 | 1,455,942 | |||||||||
High Tech Computer Corp. | 59,000 | 1,321,780 | |||||||||
Wistron Corp. | 340,000 | 486,146 | |||||||||
3,263,868 | |||||||||||
Construction Materials (0.9%) | |||||||||||
Asia Cement Corp. | 632,760 | 948,525 | |||||||||
Diversified Telecommunication Services (2.4%) | |||||||||||
Chunghwa Telecom Co., Ltd. | 955,000 | 2,469,855 | |||||||||
Electronic Equipment & Instruments (6.7%) | |||||||||||
AU Optronics Corp. | 1,551,000 | 2,437,410 | |||||||||
Chroma ATE, Inc. | 383,000 | 801,255 | |||||||||
Electronic Equipment & Instruments — continued | |||||||||||
Hon Hai Precision Industry Co., Ltd. | 650,740 | 3,205,141 | |||||||||
Tripod Technology Corp. | 233,000 | 582,634 | |||||||||
7,026,440 | |||||||||||
Insurance (2.8%) | |||||||||||
Cathay Financial Holding Co., Ltd. | 1,335,000 | 2,902,843 | |||||||||
Machinery (0.1%) | |||||||||||
Shin Zu Shing Co., Ltd. | 17,000 | 89,892 | |||||||||
Real Estate Management & Development (0.5%) | |||||||||||
Ruentex Development Co., Ltd. | 667,000 | 517,506 | |||||||||
Semiconductors & Semiconductor Equipment (8.8%) | |||||||||||
MediaTek, Inc. | 142,000 | 1,637,400 | |||||||||
Powertech Technology, Inc. | 243,000 | 852,617 | |||||||||
Siliconware Precision Industries Co. | 604,000 | 890,489 | |||||||||
Taiwan Semiconductor Manufacturing Co., Ltd. (a) | 2,714,538 | 5,813,098 | |||||||||
9,193,604 | |||||||||||
TOTAL TAIWAN | 33,510,042 | ||||||||||
TOTAL INVESTMENTS (99.1% of Net Assets) (Cost $108,513,140) | 103,649,160 | ||||||||||
Assets in Excess of Other Liabilities (0.9% of Net Assets) | 976,394 | ||||||||||
NET ASSETS (100.0%) | 104,625,554 | ||||||||||
As of June 30, 2008, aggregate cost for Federal income tax purposes was $108,513,140. The aggregate unrealized gain for all securities is as follows: | |||||||||||
Excess of market value over cost | 5,094,226 | ||||||||||
Excess of cost over market value | (9,958,206 | ) | |||||||||
Net unrealized loss | (4,863,980 | ) |
NOTES TO INVESTMENT PORTFOLIO:
(a) | Non-income producing security. |
B | Chinese security traded on Shenzhen Stock Exchange or Shanghai Stock Exchange. |
H | Chinese security traded on Hong Kong Stock Exchange. |
†† | At fair value as determined under the supervision of Board of Directors. |
AT JUNE 30, 2008 (Unaudited)
| (in US$) | |||||
---|---|---|---|---|---|---|
ASSETS: | ||||||
Investments in non-affiliates, at value (cost $108,513,140) | 103,649,160 | |||||
Cash (including foreign currencies with a cost of $228,525 and value of $228,701) | 236,949 | |||||
Receivable for securities sold | 1,207,602 | |||||
Dividends receivable | 203,566 | |||||
Prepaid expenses | 41,170 | |||||
Total Assets | 105,338,447 | |||||
LIABILITIES: | ||||||
Payables | ||||||
Payable for securities purchased | 439,042 | |||||
Accrued liabilities | ||||||
Investment advisory fees | 123,766 | |||||
Administration fees | 48,914 | |||||
Custodian and accounting fees | 4,937 | |||||
Directors’ fees | 74,032 | |||||
Other | 22,202 | |||||
Total Liabilities | 712,893 | |||||
Net Assets | 104,625,554 | |||||
Net assets consist of: | ||||||
Common stock, $0.01 par value (100,000,000 shares authorized; 4,585,160 shares issued and outstanding) | 45,852 | |||||
Paid-in capital | 83,945,330 | |||||
Undistributed (distribution in excess of) net investment income | (2,875,748 | ) | ||||
Accumulated realized gain on investments and foreign currency transactions | 28,371,686 | |||||
Accumulated net unrealized appreciation on investments, foreign currency holdings, and other assets and liabilities denominated in foreign currencies | (4,861,566 | ) | ||||
Net Assets | 104,625,554 | |||||
Net Asset Value Per Share ($104,625,554 ÷ 4,585,160) | 22.82 |
JUNE 30, 2008 (Unaudited)
| (in US$) | |||||
---|---|---|---|---|---|---|
INVESTMENT INCOME: | ||||||
Dividends (net of foreign withholding tax of $0) | 904,741 | |||||
Interest | 27,479 | |||||
Total Investment Income | 932,220 | |||||
EXPENSES: | ||||||
Investment advisory fees | 581,868 | |||||
Directors’ fees and expenses | 124,122 | |||||
Custodian and accounting fees | 103,421 | |||||
Administration fees | 75,534 | |||||
Insurance fees | 28,512 | |||||
Shareholder service fees | 21,090 | |||||
Shareholder report fees | 23,758 | |||||
Professional fees | 104,972 | |||||
NYSE listing fee | 12,467 | |||||
Total Expenses | 1,075,744 | |||||
Net Investment Loss | (143,524 | ) | ||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FOREIGN CURRENCY HOLDINGS AND OTHER ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES: | ||||||
Net realized gain | ||||||
Investments in non-affiliates | 4,856,532 | |||||
Investments in affiliates | 1,986,383 | |||||
Foreign currency transactions | 169,945 | |||||
Net realized gain | 7,012,860 | |||||
Net change in unrealized appreciation (depreciation) | ||||||
Investments in non-affiliates | (38,262,671 | ) | ||||
Investments in affiliates | (2,615,459 | ) | ||||
Foreign currency translations | 1,827 | |||||
Change in net unrealized depreciation | (40,876,303 | ) | ||||
Net realized and unrealized loss on investments, foreign currency holdings and other assets and liabilities denominated in foreign currencies | (33,863,443 | ) | ||||
Net Decrease in net assets resulting from operations | (34,006,967 | ) |
FOR THE PERIODS INDICATED
| Six Months Ended June 30, 2008 (Unaudited) (in US$) | | Year Ended December 31, 2007 (in US$) | |||||||
---|---|---|---|---|---|---|---|---|---|---|
INCREASE (DECREASE) IN NET ASSETS: | ||||||||||
Operations | ||||||||||
Net investment (loss) income | (143,524 | ) | 502,668 | |||||||
Net realized gain on investment transactions | 7,012,860 | 47,940,664 | ||||||||
Net change in unrealized (depreciation) appreciation on investments, foreign currency holdings and other assets and liabilities denominated in foreign currencies | (40,876,303 | ) | 9,536,774 | |||||||
Net (decrease) increase in net assets resulting from operations | (34,006,967 | ) | 57,980,106 | |||||||
DISTRIBUTIONS TO STOCKHOLDERS: | ||||||||||
Net investment income (loss) | — | (5,730,716 | ) | |||||||
Net realized gains (loss) | — | (18,240,775 | ) | |||||||
Total distributions to stockholders | — | (23,971,491 | ) | |||||||
Total (decrease) increase in net assets | (34,006,967 | ) | 34,008,615 | |||||||
NET ASSETS: | ||||||||||
Beginning of period | 138,632,521 | 104,623,906 | ||||||||
End of period (including distributions in excess of net investment income of $(2,875,748) and $(2,732,224), respectively) | 104,625,554 | 138,632,521 |
FOR THE PERIODS INDICATED
| For the Six Months Ended June 30, 2008 (Unaudited) (in US$) | | For the Year Ended December 31, 2007 (in US$) | | For the Year Ended December 31, 2006 (in US$) | | For the Year Ended December 31, 2005 (in US$) | | For the Year Ended December 31, 2004 (in US$) | | For the Year Ended December 31, 2003 (in US$) | |||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
For a share outstanding throughout each year: | ||||||||||||||||||||||||||
Net asset value, beginning of period | 30.24 | 22.82 | 16.04 | 14.06 | 13.93 | 7.47 | ||||||||||||||||||||
Net investment (loss) income | (0.03 | ) | 0.11 | 0.07 | 0.13 | 0.04 | (0.02 | ) | ||||||||||||||||||
Net realized and unrealized (loss) gain | (7.39 | ) | 12.54 | 6.80 | 1.91 | 0.09 | 6.48 | |||||||||||||||||||
Total from investment operations | (7.42 | ) | 12.65 | 6.87 | 2.04 | 0.13 | 6.46 | |||||||||||||||||||
Dividends from net investment income | — | (1.25 | ) | (0.09 | ) | (0.06 | ) | — | — | |||||||||||||||||
Distributions from net realized gains | — | (3.98 | ) | — | — | — | — | |||||||||||||||||||
Total dividends | — | (5.23 | ) | (0.09 | ) | (0.06 | ) | — | — | |||||||||||||||||
Dilutive effect of shares repurchased | — | — | — | — | — | —* | ||||||||||||||||||||
Net asset value, end of period | 22.82 | 30.24 | 22.82 | 16.04 | 14.06 | 13.93 | ||||||||||||||||||||
Market value, end of period | 19.85 | 25.47 | 22.80 | 13.71 | 12.80 | 18.08 | ||||||||||||||||||||
Total Investment Return | ||||||||||||||||||||||||||
Per share market value** | (22.1%) | 35.0 | % | 67.1 | % | 7.6 | % | (29.2%) | 178.2 | % | ||||||||||||||||
Per share net asset value*** | (24.5%) | 54.3 | % | 43.0 | % | 14.5 | % | 0.9 | % | 86.5 | % | |||||||||||||||
RATIOS/SUPPLEMENTAL DATA | ||||||||||||||||||||||||||
Net assets, end of period | 104,625,554 | 138,632,521 | 104,623,906 | 73,558,649 | 64,487,971 | 63,882,635 | ||||||||||||||||||||
Ratios of total expenses to average net assets | 1.84 | % | 1.54 | % | 1.95 | % | 2.08 | % | 2.22 | % | 2.54 | % | ||||||||||||||
Ratios of net investment (loss) income to average net assets | (0.25%) | 0.39 | % | 0.36 | % | 0.90 | % | 0.31 | % | (0.19%) | ||||||||||||||||
Portfolio turnover rate | 128.2 | %**** | 118.8 | % | 192.4 | % | 121.8 | % | 168.6 | % | 162.5 | % | ||||||||||||||
Number of shares outstanding at end of period (in thousands) | 4,585 | 4,585 | 4,585 | 4,585 | 4,585 | 4,585 |
* | Less than $0.01 per share. |
** | The total investment return excludes the effect of commissions. Dividends and distributions, if any, are assumed for the purpose of this calculation to be reinvested at prices obtained under the Fund’s dividend reinvestment plan. |
*** | The total investment return excludes the effect of commissions. Dividends and distributions, if any, are assumed for the purpose of this calculation to be reinvested using the net asset value of the ex-date of the dividend. |
**** | Annualized for periods less than one year. |
JUNE 30, 2008 (Unaudited)
• | Level 1 — quoted prices in active markets for identical securities |
• | Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) |
• | Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments) |
Valuation Inputs | | Investments in Securities | | Other Financial Instruments* | ||||||
---|---|---|---|---|---|---|---|---|---|---|
Level 1 | $103,649,160 | $ — | ||||||||
Level 2 | — | — | ||||||||
Level 3 | — | — | ||||||||
Total | $103,649,160 | $ — |
* | Other financial instruments include futures, forwards and swap contracts. |
JUNE 30, 2008 (Unaudited) (continued)
• | investments, other assets, and liabilities at the prevailing rates of exchange on the valuation date; |
• | investment transactions and investment income at the prevailing rates of exchange on the dates of such transactions. |
Value at | Purchase | Sales | Realized | Shares at | Value at | |||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Affiliate | | December 31, 2007 | | Cost | | Proceeds | | Gain/(Loss) | | June 30, 2008 | | June 30, 2008 | ||||||||||||||
JF China Pioneer A-Share Fund | $ | 4,631,588 | $ | 0 | $ | 4,002,511 | $ | 1,986,383 | 0 | $ | 0 |
JUNE 30, 2008 (Unaudited) (continued)
Tax Basis Ordinary Income | $ | 6,652,182 | ||||||||
Tax Basis Long-Term Capital Gain | 14,871,886 | |||||||||
Tax Unrealized Appreciation on Investments and Foreign Currencies | 33,262,897 | |||||||||
Other Cumulative Temporary Differences | (145,626 | ) | ||||||||
Net Assets (Excluding Paid-In Capital) | $ | 54,641,339 |
Nominee | | Votes For | | Votes Withheld | | Non-Voting Shares | | Total Voting Shares | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Julian M.I. Reid | 3,457,372 | 145,271 | 937,780 | 4,585,160 |
(Unaudited)
Name, (DOB), Address and Position(s) with Fund | | Term of Office and Length of Time Served | | Principal Occupation(s) During Past 5 Years | | Number of Portfolios in Fund Complex Overseen by Director* | | Other Trusteeships/Directorships Held by Director | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Independent Directors | |||||||||||||||||||
The Rt. Hon. The Earl of Cromer (June 3, 1946) Finsbury Dials 20 Finsbury Street London, EC2Y 9AQ United Kingdom Chairman and Director | Three year term ends in 2009; Chairman and Director since 1994. | Chairman of the Board of the Fund; Chief Executive Officer of Cromer Associates Limited (family business). Director of Schroder Asia Pacific Fund Limited (financial), Business Link Somerset Limited (financial services), Cambridge Asia Investments Limited (financials), Pedder Street Asia Absolute Return Fund Limited (financial); Chairman of Japan High Yield Property Fund Limited (financial), China IPO Group Limited (financial) and Western Provident Association (insurance). | 1 | See Principal Occupation. | |||||||||||||||
Alexander Reid Hamilton (October 4, 1941) P.O. Box 12343 General Post Office Hong Kong Director | Three year term ends in 2010; Director since 1994. | Director of Citic Pacific Limited (infrastructure), China Cosco Holdings Company Limited (shipping), Esprit Holdings Limited (clothing retail), Shangri-La Asia Limited (hotels), Octopus Cards Limited (financial services) and China Central Properties Limited (property). | 1 | See Principal Occupation. | |||||||||||||||
Julian M. I. Reid (August 7, 1944) Finsbury Dials, 20 Finsbury Street London, EC2Y 9AQ United Kingdom Director | Three year term ends in 2011; Director since 1998. | Chief Executive Officer of 3a Asset Management Limited (financial); Director and Chairman of Morgan’s Walk Properties Limited (property); Director and Chairman of Prosperity Voskhod Fund (financial); Director of ASA Limited (financial) and Director of 3a Global Growth Fund Limited (financial). | 1 | Director and Chairman of The Korea Fund, Inc. |
* | The Fund is the only fund in the Fund Complex. |
(Unaudited) (continued)
Name, (DOB), Address and Position(s) with Fund | | Term of Office and Length of Time Served | | Principal Occupation(s) During Past 5 Years | |||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Officers who are not Directors | |||||||||||
Simon J. Crinage (May 10, 1965) Finsbury Dials, 20 Finsbury Street London, EC2Y 9AQ United Kingdom President | Since 2003** | President of the Fund; Managing Director, JPMorgan Asset Management. | |||||||||
Michael J. James (May 11, 1967) Finsbury Dials, 20 Finsbury Street London, EC2Y 9AQ United Kingdom Treasurer | Since 2006** | Treasurer of the Fund; Vice President, JPMorgan Asset Management. | |||||||||
Christopher D. Legg (March 12, 1982) Finsbury Dials, 20 Finsbury Street London, EC2Y 9AQ United Kingdom Secretary | Since 2008** | Secretary of the Fund; Associate, JPMorgan Asset Management since September 2005. |
** | The officers of the Fund serve at the discretion of the Board. |
(Unaudited)
a) | shareholders may elect to receive dividend and capital gain distributions in the form of additional shares of the Fund (the Share Distribution Plan). |
b) | shareholders may make optional payments (any amount between $100 and $3,000) which will be used to purchase additional shares in the open market (the Share Purchase Plan). |
Computershare Trust Company, N.A. P. O. Box 43010 Providence, RI 02940-3010 USA Telephone No.: 800-426-5523 (toll-free) www.computershare.com |
(Unaudited)
Officers and Directors | The Rt. Hon. The Earl of Cromer — Director and Chairman of the Board Alexander R. Hamilton — Director Julian M. I. Reid — Director Simon J. Crinage — President Michael J. James — Treasurer Christopher D. Legg — Secretary* | |||||||||
Investment Adviser | JF International Management Inc. P.O. Box 3151 Road Town, Tortola British Virgin Islands | |||||||||
Administrator | J.P. Morgan Investor Services, Co. 73 Tremont Street, 11th Floor Boston, Massachusetts 02108 U.S.A. | |||||||||
Custodian | JPMorgan Chase Bank N.A. 73 Tremont Street, 11th Floor Boston, Massachusetts 02108 U.S.A. | |||||||||
Independent Registered Public Accounting Firm | PricewaterhouseCoopers LLP 300 Madison Avenue New York, New York 10017 U.S.A. | |||||||||
Legal Counsel | Cleary Gottlieb Steen & Hamilton LLP New York: 1 Liberty Plaza New York, New York 10006 U.S.A. | |||||||||
Hong Kong: Bank of China Tower 1 Garden Road Hong Kong | ||||||||||
Registrar, Transfer Agent, and Dividend Paying Agent | Computershare Trust Company, N.A. P. O. Box 43010 Providence, Rhode Island 02940-3010 U.S.A. |
* | Christopher D. Legg replaced Philip Jones as Fund Secretary effective March 6, 2008. |
![](https://capedge.com/proxy/N-CSRS/0001145443-08-002579/jpmorganchinalogo-k.jpg)
© JPMorgan Chase & Co., 2008 All rights reserved. June 2008. |
ITEM 2. CODE OF ETHICS.
(a) The JF China Region Fund, Inc. has adopted a code of ethics that applies its officers, directors and employees.
(b) There have been no amendments, during the period covered by this report, to a provision of the code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, and that relates to any element of the code of ethics description.
(c) The registrant has not granted any waivers, including an implicit waiver, from any provision of the code of ethics.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The Fund’s Board of Directors has determined that it does not have an "audit committee financial expert" serving on its audit committee. While the Fund believes that each of the members of its audit committee has sufficient knowledge of accounting principles and financial statements to serve on the audit committee, none has the requisite experience to qualify as an "audit committee financial expert" as such term is defined by the Securities and Exchange Commission.
Not applicable to a semi-annual report.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
The Fund incorporates by reference the information disclosed under the caption “Independent Registered Public Accounting Firm” from its definitive proxy statement that will be filed with the Commission no later than 120 days after the end of the fiscal year covered by this report.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The Fund has a separately designated audit committee consisting of all the independent directors of the Fund. The members of the audit committee are: The Rt. Hon. The Earl of Cromer, Alexander R. Hamilton and Julian M.I. Reid.
ITEM 6. SCHEDULE OF INVESTMENTS
Included in Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on this Form N-CSR must, unless it invests exclusively in non-voting securities, describe the policies and procedures that it uses to determine how to vote proxies relating to portfolio securities, including the procedures that the company uses when a vote presents a conflict between the interests of its shareholders, on the one hand, and those of the company’s investment adviser; principal underwriter; or any affiliated person (as defined in Section 2(a)(3) of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules thereunder) of the company, its investment adviser, or its principal underwriter, on the other. Include any policies and procedures of the company’s investment adviser, or any other third party, that the company uses, or that are used on the company’s behalf, to determine how to vote proxies relating to portfolio securities.
Not applicable to a semi-annual report.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
(a) Not applicable to a semi-annual report.
(b) There has been no change, as of the date of this filing, in any of the portfolio managers identified in response to paragraph (a) (1) of this Item in the registrant’s most recently filed annual report on Form N-CSR.
ITEM 9. PURCHASE OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders may recommend nominees to the Fund’s board of directors since the Fund filed its last form NCSR
ITEM 11. CONTROLS AND PROCEDURES.
The Fund's principal executive and principal financial officers have concluded that the Fund’s disclosure controls and are effective, as of June 30, 2008, based on their evaluation of these controls and procedures.
There were no changes in the Fund's internal control over financial reporting that occurred during the last fiscal quarter covered by this report that have materially affected, or are reasonably likely to materially affect, the Fund's internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) The code of ethics that is the subject of the disclosure required by Item 2 is incorporated by reference from EX-99.CODE ETH to the Fund's N-CSR, filed with the Commission on March 10, 2006.
| (a)(2) Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940. |
| (b) Certifications pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 are attached hereto. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
JF China Region Fund, Inc.
By: | /s/_____________________________ |
Simon Crinage
President and Principal Executive Officer
September 5, 2008
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: | /s/___________________________ |
Simon Crinage
President and Principal Executive Officer
September 5, 2008
By: | /s/____________________________ |
Michael J. James
Treasurer and Principal Financial Officer
September 5, 2008