Chief Executive Officer Details Focused Initiatives to Further Accelerate                             Shareholder Value   

NEW YORK and SHENZHEN, China, Dec. 5 /PRNewswire-Asia-FirstCall/ -- China Finance, Inc. (OTC Bulletin Board: CHFI; the "Company"), a provider of financial support and services for China's large and rapidly expanding class of small and medium enterprises ("SMEs"), today released the following letter to shareholders from Ms. Ann Yu, Chief Executive Officer:

   December 5, 2008   My Fellow Shareholders:  

In light of the current turmoil in the global financial markets, and several exciting developments at our Company, I wanted to share some thoughts directly with you.

We believe that China Finance offers an opportunity that is unique among investment companies. While we are a publicly traded closed end fund, our flexible yet focused business model is designed to permit varied initiatives to maximize potential value for our shareholders. I believe that steps taken, planned and underway at the Company will significantly enhance our ability to grow revenues and earnings into 2009 and beyond.

While the main thrust of our business activities has been and will continue to be providing financial services (such as guarantee, loan and other financing services) to small and medium sized (SME) China-based companies, we have extended our investment strategy to include directly acquiring positions (including controlling positions) in enterprises where we see substantial growth and revenue potential. A case in point is our recently announced intention to purchase 80% of the shares of Wenxi Baiyu Magnesium for approximately $11.4 million. This potential purchase, which is still in negotiations, is representative of the type of direct investments we are looking to make in the future as we seek to expand our revenues and provide consistent and growing shareholder value. We expect our future direct investments to be in companies that have earned a minimum of $30 million in revenue during their most recent fiscal year.

As previously announced, we are also in the process of seeking a listing on the NYSE Alternext US (formerly the American Stock Exchange) that should increase our Company's visibility within the investment community, expose our Company to more investors, and raise our profile within our target markets to allow us to attract more (and potentially greater) revenue producing opportunities. While there can be no assurance that we will become listed, we are working with the NYSE to provide materials and information they have requested to keep the process moving forward.

As you know, the current global market turmoil has led to declines in stock markets around the world.