Financial Performance - Total operating revenue for the year ended December 31, 2024, was RMB 904,977,000, a decrease of 24.0% compared to RMB 1,190,457,000 in 2023[5] - Net interest income was negative RMB 56,270,000, down from positive RMB 100,235,000 in the previous year[5] - Net commission and fee income decreased to RMB 455,105,000 from RMB 766,122,000, representing a decline of 40.6%[5] - The company reported a net profit of RMB 142,795,000, down from RMB 158,633,000 in the previous year, a decrease of 10.0%[5] - The total comprehensive income attributable to equity holders of the parent was RMB 147,348,000, compared to RMB 155,110,000 in 2023, a decline of 5.0%[5] - The company achieved total operating revenue of RMB 905.0 million in 2024, a decrease of 24.0% year-on-year, with total profit of RMB 213.6 million, down 26.4% year-on-year[13] - The total revenue from trust business for the year ended December 31, 2024, was RMB 459 million, a decrease of 40.4% from RMB 771 million in 2023[20] - The total profit for 2024 was RMB 213.6 million, down from RMB 290.2 million in 2023, with an operating profit margin of 23.6%, slightly down from 24.4%[65] - Net profit for 2024 was RMB 142.8 million, a decrease from RMB 158.6 million in 2023, while the net profit margin improved from 13.3% to 15.8%[67] Asset and Liability Management - Total assets increased to RMB 14,279,338,000 in 2024 from RMB 14,168,884,000 in 2023, reflecting a growth of 0.8%[6] - Total liabilities decreased slightly to RMB 3,042,612,000 from RMB 3,079,506,000, a reduction of 1.2%[6] - The total assets of the group increased from RMB 14,168.9 million in 2023 to RMB 14,279.3 million in 2024, with significant assets including loans and advances, debt investments, and cash[77] - The total amount of loans and advances issued decreased slightly from RMB 2,428.7 million in 2023 to RMB 2,420.4 million in 2024, with net loans and advances amounting to RMB 2,159.1 million[79][80] - The company's total liabilities decreased slightly from RMB 3,079.5 million in 2023 to RMB 3,042.6 million in 2024[96] - The company's short-term borrowings amounted to RMB 280.5 million as of December 31, 2024, with repayment scheduled in April, June, and July 2025[97] Trust Business Overview - Trust business revenue accounted for 51.5% of total revenue, while proprietary business revenue accounted for 48.5%[15] - The number of financing trusts managed decreased from 238 to 227, with the asset scale dropping from RMB 43.85 billion to RMB 39.28 billion[17] - The number of investment trusts increased from 1,652 to 1,838, with the asset scale rising from RMB 84.73 billion to RMB 126.96 billion[17] - The company signed 21 new charitable trust agreements during the year, representing a year-on-year growth of 19.1%[11] - The total scale of family trusts, family service trusts, and insurance trusts reached RMB 51.92 billion, a year-on-year increase of 34%[11] - The trust fund collected from financing trust plans decreased from RMB 333.9 million as of December 31, 2023, to RMB 280.0 million as of December 31, 2024[100] - The total assets of consolidated trust plans increased from RMB 3,724.3 million as of December 31, 2023, to RMB 4,834.3 million as of December 31, 2024[103] Risk Management and Compliance - The company has implemented over 120 revisions to its internal control management systems to enhance risk management[12] - The company's risk management framework is comprehensive, covering all aspects of business operations to ensure stable development and effective risk identification[109] - The company has implemented a comprehensive credit risk management system to mitigate risks associated with client defaults in trust contracts[123] - The company actively monitors compliance with laws and regulations, continuously updating internal policies and conducting employee training programs[127] - The company has established a customer identification system to ensure compliance with anti-money laundering regulations, requiring employees to verify and update customer identity information[133] Strategic Initiatives and Future Outlook - The company aims to maintain a stable development trend while focusing on core business transformation and risk management amidst a complex external environment[10] - The company is committed to providing comprehensive management and investment services through an integrated information system covering the entire project lifecycle[31] - The company plans to actively support long-term rental housing and affordable housing construction in response to national macro policies, addressing residents' housing needs[32] - The company aims to enhance customized services and professional levels in the charitable trust sector to promote social welfare and common prosperity[37] - The company is expected to benefit from supportive fiscal and monetary policies aimed at promoting new productive forces and managing risks in key areas[137] - In 2025, the company aims to focus on high-quality development, emphasizing family trusts, retirement trusts, and real estate trust registration as core business opportunities[138] Corporate Governance and Management Changes - The company has adopted a corporate governance code to enhance shareholder rights and corporate accountability[153] - The company has confirmed compliance with the corporate governance code throughout the reporting period[155] - The board of directors has undergone changes, with new appointments and approvals from the Shandong Financial Regulatory Bureau[145][146] - The company will see a change in senior management, with the current general manager stepping down on June 27, 2024, and new vice general managers appointed[151]

Group 1 - The event on March 12 was guided by the Shandong Regulatory Bureau of the National Financial Supervision Administration and organized by the Shandong Banking Association to promote financial consumer rights protection [1] - Shandong Guoxin actively participated in the event, using various promotional materials to educate the public on financial knowledge and risk prevention in a fun and engaging manner [1] - During the "3·15" period, Shandong Guoxin will utilize both online and offline methods to guide financial consumers in learning about financial knowledge, including original comic series and interactive quiz activities [1] Group 2 - Shandong Guoxin aims to deepen the service concept of "consumer protection for the people" by integrating internal and external resources to build a comprehensive consumer rights protection system [2] - The company focuses on helping financial consumers to "learn finance, understand finance, and enjoy finance," contributing to a trustworthy and harmonious financial ecosystem [2]

Group 1 - The "2024 Cardiovascular Health Conference" was held in Beijing, focusing on the construction of seven scientific centers in the cardiovascular field and featuring over 20 academic forums [1] - The conference attracted more than 1,500 experts and scholars in the cardiovascular field, showcasing the latest technologies, products, and solutions related to cardiovascular diseases [1] - Keynote speeches were delivered by prominent figures in the field, including academicians from Fudan University and Tsinghua University, emphasizing the importance of cardiovascular health [1] Group 2 - Shanghai Shangqing Real Estate Development Co., Ltd. announced a donation of 1.647 million RMB to support the "Heart Guardian Rural Savior" project, aimed at enhancing the diagnostic and emergency response capabilities of rural doctors [2] - The project is expected to screen 24,000 individuals for heart conditions, treat 1,000 critical patients, and conduct 40,000 public health promotions, benefiting over 10,000 people in remote areas [2] - This initiative by Shandong Guoxin demonstrates a commitment to social responsibility and aims to alleviate the shortage of medical resources in rural areas, contributing to the health foundation of rural revitalization [2][3]

[Company Overview](index=3&type=section&id=Company%20Overview) [Company Profile, Shareholding Structure and Business Layout](index=3&type=section&id=Company%20Profile%2C%20Shareholding%20Structure%20and%20Business%20Layout) Shandong Guoxin, established in 1987, is a non-bank financial institution approved by the People's Bank of China and Shandong Provincial Government, listed on the Hong Kong Stock Exchange in 2017 as the first mainland trust company to enter the international capital market. Its controlling shareholder is Shandong Luxin Investment Holdings Group Co., Ltd. The company's business is structured around the "New Three Categories" reform, establishing three major divisions: Capital Market, Wealth Management, and Family Trust, covering family trusts, asset management, and asset services, with a network expanding to major cities like Jinan, Qingdao, Beijing, and Shanghai - The company positions itself as a professional wealth management institution based on asset allocation, committed to supporting the real economy, serving public welfare, and fulfilling social responsibilities[4](index=4&type=chunk)[8](index=8&type=chunk) - The company was listed on the Main Board of the Hong Kong Stock Exchange (stock code: 1697.HK) in 2017, becoming the first domestic trust company listed on the international capital market[7](index=7&type=chunk)[8](index=8&type=chunk) Shareholding Structure Overview (As of Mid-2024) | Shareholder Name | Shareholding Percentage | | :--- | :--- | | Shandong Luxin Investment Holdings Group Co., Ltd. | 48.13% | | CNPC Asset Management Co., Ltd. | 18.75% | | Jinan Jintou Holdings Group Co., Ltd. | 5.43% | | Shandong High-tech Venture Capital Co., Ltd. | 4.83% | | Shandong Gold Group Co., Ltd. | 1.72% | | Weifang Investment Group Co., Ltd. | 1.29% | | Jinan Energy Investment Co., Ltd. | 0.28% | | Other Public Shareholders | 19.57% | [Key Financial Indicators](index=9&type=section&id=Key%20Financial%20Indicators) [Financial Data Summary](index=9&type=section&id=Financial%20Data%20Summary) For the six months ended June 30, 2024, the company's total operating income was RMB 588 million, a year-on-year decrease. Total profit was RMB 253 million, slightly lower than the same period last year. Total assets remained relatively stable at RMB 13.70 billion Key Financial Data (RMB Million) | Indicator | H1 2024 | H1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Total Operating Income | 588 | 836 | -29.7% | | Fee and Commission Income | 273 | 421 | -35.2% | | Total Profit | 253 | 276 | -8.3% | | Total Assets (Period-end) | 13,700 | 13,704 | -0.03% | [Management Discussion and Analysis](index=10&type=section&id=Management%20Discussion%20and%20Analysis) [Environment and Business Review](index=10&type=section&id=Environment%20and%20Business%20Review) In H1 2024, facing a complex macro environment, the company maintained steady progress and firmly returned to its trust origins. Managed trust assets significantly grew to RMB 241.237 billion, up 19.77% from the beginning of the year, with securities investment trust business growing particularly fast at 73.10%. Family trust business also maintained strong growth, with existing scale increasing by 32% year-on-year. Despite business expansion, total operating income decreased by 29.7% to RMB 588 million, and net profit slightly decreased by 2.6% to RMB 171 million, due to reduced net fee and commission income and investment income - China's trust industry is accelerating its transformation from traditional private financing models to asset services and asset management models. As of the end of 2023, the industry's managed trust assets reached **RMB 23.92 trillion**[14](index=14&type=chunk) H1 2024 Key Business Scale Indicators | Business Indicator | Scale as of June-end 2024 (RMB Billion) | Change from Year-start/YoY | | :--- | :--- | :--- | | Managed Trust Assets | 241.237 | Up 19.77% from year-start | | Securities Investment Trust Business | >100 | Up 73.10% from year-start | | Family Trust Existing Scale | ≈47 | Up 32% YoY | | Green Trust Assets Existing Scale | 3.556 | - | H1 2024 Performance Overview (RMB Million) | Indicator | H1 2024 | H1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Total Operating Income | 587.8 | 836.2 | -29.7% | | Total Profit | 253.3 | 275.9 | -8.2% | | Net Profit | 170.5 | 175.1 | -2.6% | [Business Segment Performance](index=13&type=section&id=Business%20Segment%20Performance) The company's business is divided into trust business and proprietary business. In H1 2024, trust business accounted for 46.0% of revenue, and proprietary business for 54.0%. Within trust business, investment-type trust assets significantly grew by 50.2% to RMB 127.285 billion, becoming the largest asset category. For proprietary business, the company prudently utilized its own funds, achieving segment income of RMB 317 million in H1, a year-on-year decrease mainly due to reduced investment income H1 2024 Segment Revenue Composition | Business Segment | Revenue (RMB Thousand) | Percentage | | :--- | :--- | :--- | | Trust Business | 270,866 | 46.0% | | Proprietary Business | 317,348 | 54.0% | | **Total** | **588,214** | **100.0%** | [Trust Business](index=13&type=section&id=Trust%20Business) In H1 2024, trust business generated RMB 271 million in revenue. By management type, investment-type trust assets grew significantly from RMB 84.7 billion at the beginning of the year to RMB 127.3 billion, an increase of 50.2%, becoming the largest trust type by scale. Financing-type trusts remained the primary source of income, contributing RMB 151 million, accounting for 55.3% of trust business fee and commission income. The company made significant progress in core trust businesses such as family trusts, securities investment trusts, and charitable trusts Managed Asset Scale by Trust Type (RMB Million) | Trust Type | June 30, 2024 | December 31, 2023 | Change | | :--- | :--- | :--- | :--- | | Financing Trust | 41,627 | 43,845 | -5.1% | | Investment Trust | 127,285 | 84,725 | +50.2% | | Administration Trust | 50,825 | 56,982 | -10.8% | | **Total** | **219,737** | **185,552** | **+18.4%** | Income Generated by Trust Type (RMB Million) | Trust Type | H1 2024 Income | Percentage | H1 2023 Income | Percentage | | :--- | :--- | :--- | :--- | :--- | | Financing Trust | 151 | 55.3% | 263 | 62.5% | | Investment Trust | 77 | 28.2% | 82 | 19.5% | | Administration Trust | 45 | 16.5% | 76 | 18.0% | | **Total** | **273** | **100.0%** | **421** | **100.0%** | - Family trust business continues to lead, with over **4,600** cumulative setups and an existing scale of nearly **RMB 47 billion** as of June-end 2024[26](index=26&type=chunk) - Securities investment trust business expanded rapidly, with an existing scale exceeding **RMB 100 billion** as of June-end 2024[32](index=32&type=chunk) - Continuous innovation in public welfare and charitable trusts, including the first dual-trustee charitable trust in Shandong Province and the industry's first charitable trust with a foreign settlor, with **45** standardized charitable trusts established and a delivered scale of approximately **RMB 148 million**[36](index=36&type=chunk) [Proprietary Business](index=21&type=section&id=Proprietary%20Business) In H1 2024, the proprietary business segment generated RMB 317 million in revenue, a year-on-year decrease of 24.5%. This was primarily due to a significant reduction in investment income from RMB 134 million in the prior year to RMB 42.1 million, and net interest income turning negative. However, fair value change gains increased. In terms of asset allocation, the company continued to optimize its structure, with securities investments remaining the largest allocation at 79.7%, though the total amount decreased. Long-term equity investments increased - Proprietary business segment revenue decreased by **24.5%** year-on-year, mainly due to reduced investment income and net interest income turning negative, partially offset by increased fair value change gains[37](index=37&type=chunk) Proprietary Asset Allocation (RMB Thousand) | Asset Category | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Monetary Asset Investments | 788,662 | 628,173 | | Securities Investments | 9,187,712 | 10,019,091 | | Long-term Equity Investments | 1,269,530 | 1,153,095 | | Proprietary Fund Loans | 173,368 | 115,627 | | Trust Industry Guarantee Fund | 113,962 | 111,448 | | **Total** | **11,533,234** | **12,027,434** | - The company made strategic long-term equity investments in several financial institutions, including Sinotruk Auto Finance, Taishan Property Insurance, Dezhou Bank, and Minsheng Securities[43](index=43&type=chunk)[44](index=44&type=chunk) [Financial Review](index=27&type=section&id=Financial%20Review) In H1 2024, the group's net profit was RMB 171 million, a slight year-on-year decrease of 2.6%. Total operating income decreased by 29.7% to RMB 588 million, primarily due to significant year-on-year reductions in net fee and commission income and investment income. However, credit impairment losses decreased by 44.3% to RMB 155 million, and non-operating expenses significantly decreased due to reduced estimated litigation compensation, partially offsetting the negative impact on revenue. Consequently, operating profit margin increased from 33.0% to 43.1%, and net profit margin increased from 20.9% to 29.0% H1 2024 Consolidated Income Statement Summary (RMB Thousand) | Item | H1 2024 | H1 2023 | Reason for Change | | :--- | :--- | :--- | :--- | | **Total Operating Income** | **587,752** | **836,157** | Decrease in net fee and commission income, investment income | | Net Interest Income | -4,550 | 35,014 | Decrease in loan interest income | | Net Fee and Commission Income | 270,763 | 418,612 | Decrease in trust remuneration | | Investment Income | 42,144 | 133,775 | Decrease in investment income from financial assets held during the period | | Fair Value Change Gains | 241,813 | 212,071 | Increase in fair value change gains from equity investments, etc. | | **Total Operating Expenses** | **295,780** | **447,435** | Decrease in credit impairment losses, business and management expenses | | Credit Impairment Losses | 154,963 | 278,020 | Decrease in provisions based on credit risk assessment | | Non-operating Expenses | 39,107 | 115,722 | Significant decrease in estimated litigation compensation expenses | | **Total Profit** | **253,327** | **275,922** | Revenue decline partially offset by cost and expense decline | | **Net Profit** | **170,508** | **175,077** | Combined impact of total profit decline and reduced income tax expense | - Trust business total profit decreased from **RMB 137 million** to **RMB 102 million**, a **25.7%** decrease, mainly due to reduced income. Proprietary business total profit increased from **RMB 139 million** to **RMB 151 million**, a **9.2%** increase, mainly due to a significant reduction in credit impairment losses[62](index=62&type=chunk)[63](index=63&type=chunk)[65](index=65&type=chunk) - As of June 30, 2024, the group's total assets were **RMB 13.70 billion**, a **3.3%** decrease from the beginning of the year. Major assets include debt investments (**34.1%**), financial assets held for trading (**28.8%**), and loans and advances (**14.8%**)[67](index=67&type=chunk) - The company holds **579 million** A-shares of Zheshang Bank (representing **2.11%** of its total share capital), with a fair value of **RMB 1.562 billion** as of June 30, 2024, accounting for **11.4%** of the company's total assets[73](index=73&type=chunk) [Risk Management](index=45&type=section&id=Risk%20Management) The company has established a comprehensive risk management and internal control system, with an organizational structure covering the Board of Directors, Board of Supervisors, senior management, and various functional departments. Risk management encompasses credit risk, market risk, liquidity risk, compliance risk, operational risk, and reputational risk. During the reporting period, the company strictly adhered to regulatory requirements, utilized intelligent risk control systems to enhance decision-making capabilities, and continuously improved its anti-money laundering management mechanism. The Board of Directors has reviewed and deemed the group's risk management and internal control systems adequate and effective - The company has established a multi-level comprehensive risk management organizational structure covering the Shareholders' Meeting, Board of Directors, Board of Supervisors, General Manager's Office, and various functional departments[87](index=87&type=chunk)[88](index=88&type=chunk) - The company faces key risks including macroeconomic and financial market fluctuations, changes in the regulatory environment, business portfolio structure, market competition, and interest rate environment changes[90](index=90&type=chunk)[91](index=91&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk) - The company has formulated and implemented the "Anti-Money Laundering Management Measures," established an anti-money laundering working group, and set up customer identification and suspicious transaction reporting systems[106](index=106&type=chunk)[107](index=107&type=chunk) [Capital and Human Resources Management](index=53&type=section&id=Capital%20and%20Human%20Resources%20Management) The company manages capital based on net capital and risk capital to ensure compliance with regulatory requirements. As of June 30, 2024, all capital adequacy ratios met regulations. In human resources, the company continued to deepen market-oriented reforms, implementing a market-driven performance appraisal and incentive system. As of June 30, 2024, the company had 307 employees, a decrease of 27 from the same period last year, with 78.5% holding master's degrees or higher Capital Adequacy Ratios (As of June 30, 2024) | Indicator | Actual Value | Regulatory Requirement | | :--- | :--- | :--- | | Net Capital | Approx. RMB 9.0 billion | ≥ RMB 200 million | | Net Capital / Total Risk Capital | 280.2% | ≥ 100% | | Net Capital / Net Assets | 80.0% | ≥ 40% | Employee Structure (As of June 30, 2024) | Category | Number of Employees | Percentage | | :--- | :--- | :--- | | **Total Employees** | **307** | **100%** | | **By Function** | | | | Trust Business Employees | 122 | 39.74% | | Wealth Management Employees | 53 | 17.26% | | Risk Control and Audit Employees | 47 | 15.31% | | **By Education** | | | | Doctorate and Above | 5 | 1.63% | | Master's Degree | 236 | 76.87% | | Bachelor's Degree | 61 | 19.87% | [Future Outlook](index=59&type=section&id=Future%20Outlook) Looking ahead, despite global economic uncertainties, the fundamental long-term positive trend of the Chinese economy remains unchanged. The trust industry will accelerate its return to core business and transformation. Shandong Guoxin will continue to be guided by regulatory policies, firmly advance its transformation, focus on capital markets, family trusts, and wealth management as its three key business areas, enhance localized capabilities, serve the real economy and public welfare, and strive to build a new pattern of high-quality development - The company will focus on three key business areas: capital markets, family trusts, and wealth management, leveraging regional resources to excel in "five major articles" (tech finance, green finance, inclusive finance, elderly care finance, digital finance) in the future[113](index=113&type=chunk) [Share Capital Changes and Major Shareholder Holdings](index=59&type=section&id=Share%20Capital%20Changes%20and%20Major%20Shareholder%20Holdings) [Share Capital Structure and Major Shareholders](index=59&type=section&id=Share%20Capital%20Structure%20and%20Major%20Shareholders) As of June 30, 2024, the company's total share capital was 4,658,850,000 shares, with no changes during the reporting period, comprising 75% domestic shares and 25% H-shares. Among major shareholders, Shandong Provincial Department of Finance, through its controlled entities including Luxin Group, collectively held 52.96% of the company's shares, serving as the actual controller. CNPC Asset Management Co., Ltd. held 18.75% of the shares, making it the second-largest shareholder Share Capital Structure (As of June 30, 2024) | Share Class | Number of Shares | Percentage (%) | | :--- | :--- | :--- | | Domestic Shares | 3,494,115,000 | 75 | | H-Shares | 1,164,735,000 | 25 | | **Total** | **4,658,850,000** | **100** | Major Shareholder Holdings (As of June 30, 2024) | Shareholder Name | Share Class | Number of Shares Held | Percentage of Total Share Capital | | :--- | :--- | :--- | :--- | | Shandong Provincial Department of Finance (Interests of controlled corporations) | Domestic Shares | 2,467,202,580 | 52.96% | | CNPC Asset Management Co., Ltd. | Domestic Shares | 873,528,750 | 18.75% | | Jinan Jintou Holdings Group Co., Ltd. | H-Shares | 252,765,000 | 5.43% | [Directors, Supervisors and Senior Management](index=63&type=section&id=Directors%2C%20Supervisors%20and%20Senior%20Management) [Changes in Directors, Supervisors and Senior Management](index=63&type=section&id=Changes%20in%20Directors%2C%20Supervisors%20and%20Senior%20Management) During the reporting period, several changes occurred in the company's directors, supervisors, and senior management. Mr. Yue Zengguang officially assumed the role of Executive Director and Chairman on January 1, 2024. Following the Annual General Meeting in June 2024, the Board of Directors and Board of Supervisors underwent re-election, with several directors and supervisors not seeking re-election due to term expiry, and new members being elected. In senior management, Mr. Lin Guanwei was appointed as Deputy General Manager, while Mr. Cui Fang ceased to be Assistant General Manager due to term expiry - Mr. Yue Zengguang was approved by the Shandong Financial Regulatory Bureau on January 10, 2024, to officially serve as the company's Executive Director and Chairman[120](index=120&type=chunk) - The company completed the re-election of the Fourth Board of Directors and Board of Supervisors at the Annual General Meeting on June 27, 2024[120](index=120&type=chunk)[122](index=122&type=chunk) - Mr. Fang Hao ceased to be Executive Director and General Manager due to term expiry. Mr. Wang Zengye and Mr. Zhao Zikun did not seek re-election as Non-executive Directors due to term expiry[120](index=120&type=chunk) - Mr. Lin Guanwei was approved to serve as the company's Deputy General Manager on July 24, 2024[123](index=123&type=chunk) [Significant Matters](index=65&type=section&id=Significant%20Matters) [Corporate Governance and Internal Control](index=65&type=section&id=Corporate%20Governance%20and%20Internal%20Control) The company is committed to maintaining high standards of corporate governance and has adopted the HKEX Corporate Governance Code. During the reporting period, there was a brief deviation from the code's provision requiring separation of Chairman and Chief Executive roles due to the General Manager acting as Chairman and the Chairman acting as General Manager. The company has established a comprehensive risk management and internal control system, which the Board of Directors annually reviews and deems adequate and effective. Internal audit, led by the Audit Committee, conducts regular special inspections to ensure the company's healthy development - During the reporting period, due to personnel changes, the company briefly deviated from the Corporate Governance Code's provision on the separation of Chairman and Chief Executive roles, but the Board believes the checks and balances structure remains sufficient[125](index=125&type=chunk) - The Board of Directors bears ultimate responsibility for the establishment, soundness, and effective implementation of internal controls, and has reviewed and deemed the group's risk management and internal control systems adequate and effective[130](index=130&type=chunk)[133](index=133&type=chunk) - The company's Board of Directors does not recommend the distribution of an interim dividend for 2024[134](index=134&type=chunk) [Disclosure of Significant Matters](index=71&type=section&id=Disclosure%20of%20Significant%20Matters) During and after the reporting period, several significant matters occurred. The company's Articles of Association were revised in accordance with changes in Chinese regulations, removing provisions related to class shareholders and their meetings. Regarding litigation, as of June 30, 2024, the company was involved in 8 major lawsuits/arbitrations as plaintiff, totaling approximately RMB 1.72 billion; and 4 major lawsuits as defendant, totaling approximately RMB 794 million. Additionally, on August 8, 2024, the company reached an agreement with Guolian Securities to sell part of its equity in Minsheng Securities for approximately RMB 347 million, to be paid by issuing A-shares of Guolian Securities - The company revised its Articles of Association in accordance with changes in Chinese regulations and HKEX rules, removing provisions regarding class shareholders and the convening of class shareholder meetings[136](index=136&type=chunk)[137](index=137&type=chunk) Major Litigation and Arbitration Cases (As of June 30, 2024) | Role | Number of Cases | Amount Involved (RMB) | | :--- | :--- | :--- | | Plaintiff/Applicant | 8 cases | Approx. RMB 1.72 billion | | Defendant | 4 cases | Approx. RMB 794 million | - On August 8, 2024, the company entered into an agreement with Guolian Securities to sell **132,715,017** shares of Minsheng Securities for a consideration of **RMB 346.7 million**, to be paid by newly issued A-shares of Guolian Securities. This transaction constitutes a discloseable transaction[140](index=140&type=chunk) [Interim Financial Information Review Report](index=74&type=section&id=Interim%20Financial%20Information%20Review%20Report) [Auditor's Review Opinion](index=74&type=section&id=Auditor's%20Review%20Opinion) ShineWing Certified Public Accountants (Special General Partnership) reviewed the company's interim financial statements as of June 30, 2024. Based on the review, the auditor did not note any matters that would lead them to believe the financial statements were not prepared in all material respects in accordance with enterprise accounting standards, or that they failed to fairly present the company's financial position, operating results, and cash flows - ShineWing Certified Public Accountants issued an unmodified review conclusion, stating that the financial statements fairly present the company's financial position in all material respects[147](index=147&type=chunk)

Financial Performance - Total operating income for the six months ended June 30, 2024, was RMB 587,752,000, a decrease of 29.7% compared to RMB 836,157,000 in the same period of 2023[3]. - Net interest income was negative RMB 4,550,000, down from positive RMB 35,014,000 year-on-year[3]. - Net fee and commission income decreased to RMB 270,763,000, a decline of 35.4% from RMB 418,612,000 in the previous year[3]. - Investment income dropped to RMB 42,144,000, down 68.4% from RMB 133,775,000 in the same period last year[3]. - Total profit for the six months was RMB 253,327,000, a decrease of 8.2% compared to RMB 275,922,000 in 2023[3]. - Net profit for the period was RMB 170,508,000, slightly down from RMB 175,077,000 year-on-year[3]. - Total operating revenue for the first half of 2024 was RMB 587.8 million, a decrease of 29.7% year-on-year, while net profit was RMB 170.5 million, down 2.6%[12]. - The company's net profit for the first half of 2024 was RMB 170.5 million, a decrease of RMB 4.6 million or 2.6% compared to the same period last year[48]. - The total operating profit for the first half of 2024 was approximately 291.97 million, a decrease of 25% compared to 388.72 million in the same period of 2023[144]. - The company's total comprehensive income for the first half of 2024 was approximately 167.77 million, compared to 175.21 million in the same period of 2023, a decrease of about 4.3%[146]. Asset Management - Total assets as of June 30, 2024, were RMB 13,699,817,000, compared to RMB 14,168,884,000 at the end of 2023[5][6]. - As of June 30, 2024, the company's managed trust assets reached RMB 241.24 billion, an increase of RMB 39.82 billion, representing a growth of 19.77% since the beginning of the year[9]. - The asset management scale, including insurance trust scale, reached RMB 241,237 million as of June 30, 2024, up from RMB 201,421 million at the end of 2023[15]. - The total amount of securities investments as of June 30, 2024, was RMB 9,187,712 million, down from RMB 10,019,091 million as of December 31, 2023[36]. - The total amount of consolidated assets managed by the company was RMB 11,533,234 million as of June 30, 2024, compared to RMB 12,027,434 million as of December 31, 2023[36]. Trust Business - Trust business revenue accounted for 46.0% of total revenue, while proprietary business revenue made up 54.0%[12]. - Family trust assets reached nearly RMB 47 billion, with a year-on-year growth of 32%[9]. - The financing trusts generated revenue of RMB 151 million for the six months ending June 30, 2024, accounting for 55.3% of total trust business revenue, down from RMB 263 million and 62.5% in the same period of 2023[16]. - Investment trusts produced revenue of RMB 77 million, representing 28.2% of total revenue, compared to RMB 82 million and 19.5% in the previous year[16]. - The total profit from the trust business for the first half of 2024 was RMB 102.1 million, down from RMB 137.4 million in the first half of 2023[67]. - Trust business segment revenue decreased by 35.3% from RMB 418.7 million in H1 2023 to RMB 270.9 million in H1 2024[69]. Risk Management - The company has established a comprehensive risk management system, updating and revising 65 internal regulations to enhance compliance and operational stability[11]. - The company's risk management framework includes various committees and departments responsible for overseeing risk control and compliance[98]. - The company strictly adheres to credit risk management guidelines set by the financial regulatory authority, enhancing risk control in key areas to mitigate credit risk[109]. - Market risk is managed through a diversified and carefully selected investment portfolio, alongside a strict investment decision-making mechanism[112]. - The company actively manages reputation risk by enhancing customer loyalty through excellent wealth management capabilities and maintaining communication with stakeholders[116]. Regulatory Environment - The company is subject to credit risk from clients and counterparties failing to fulfill contractual obligations, which arises from both its trust and proprietary businesses[108]. - The company's trust business is significantly impacted by regulatory changes in China, which may affect the scale, revenue, and profitability of its trust services[102]. - Regulatory policies in the financial sector may indirectly affect the company's trust business, leading to increased competition from commercial banks and their wealth management subsidiaries[103]. - The company aims to diversify its trust products by designing customized trust products to meet different client needs, which is expected to significantly impact future financial performance[105]. Corporate Governance - The board of directors has undergone changes, with new appointments and re-elections taking place during the annual general meeting[127]. - The company has not declared or recommended any dividends for the six months ending June 30, 2024[168]. - The company has established a customer identification system to comply with anti-money laundering regulations, requiring employees to verify and update customer identity information[119]. - The audit committee reviewed the accounting principles and practices adopted by the company for the six-month interim results ending June 30, 2024[172]. Market Conditions - The overall economic and financial market conditions in China significantly impact the company's business operations and financial performance[100]. - The company anticipates that the structural transformation of the Chinese economy and macroeconomic policies will continue to pose challenges to its trust business[100]. - The company recognizes potential new business opportunities during the economic transition period, despite the challenges posed by economic slowdown[100]. - The company faces increased default risk from counterparties during economic downturns, which may affect its trust product demand[100].

在行业面临转变发展方式、优化业务结构的战之际，"信托业务三分类"及系列配套文件正式出炉，为整个信托行业的转型明确了方向。在监管指导及各方努力下，行业发展日益稳健。据信托业协会今年1月布数据，截至去年三季度末，中国信托资产规模余额为22.64万亿元，同比增7.45%。                                                                 （资料来源：公开信息） 在信托行业整体资产规模稳健增长同时，行业也在转型加速，优化业务结构，创新服务实体经济和民生。山东国信（01697.HK）作为地方国资信托公司代表，同时也是内地信托登陆国际资本市场第一股和港股信托第一股，始终牢记客户"信任之深和托付之重"坚持稳中求进，服务经济社会发展，构建广泛的发展格局，彰显国企社会责任。 回顾2023年，面对复杂严峻的国内外环境和行业变革，山东国信承压奋进，砥砺前行，以监管指引为导向，将信托本源业务作为战略转型重点稳步推进，积极应对超预期冲击，高效统筹发展与风险，整体稳中向好，工作取得新成效。 展望2024年，在推动高质量发展与助力新质生产力的号召下，信托行业充满机遇。山东国 ...

Financial Performance - As of the reporting period, the company's total consolidated assets amounted to RMB 14.169 billion, with total liabilities of RMB 3.080 billion and total equity of RMB 11.089 billion[30]. - The company achieved a pre-tax consolidated profit of RMB 290 million and a net profit attributable to shareholders of RMB 159 million for the year[30]. - In 2023, the total operating revenue of the group was RMB 1,190.5 million, a year-on-year decrease of 21.1%[91]. - The net profit for the group was RMB 158.6 million, representing a year-on-year decline of 43.4%[91]. - Total operating income for 2023 was RMB 1,190 million, a decline of 21% from RMB 1,509 million in 2022[110]. - The total profit for 2023 was RMB 290 million, a decrease of 51% compared to RMB 591 million in 2022[110]. - Commission and fee income for 2023 was RMB 771 million, down 22% from RMB 990 million in 2022[110]. - Interest income increased significantly to RMB 192 million in 2023, compared to RMB 63 million in 2022[110]. - Total operating costs decreased to RMB 781 million in 2023, down 15% from RMB 916 million in 2022[110]. Trust Business and Assets - The total trust scale managed by the company, including insurance trust scale, reached RMB 201.421 billion, with trust revenue of RMB 771 million for the year[30]. - The scale of standard product trusts reached RMB 74.349 billion, significantly enhancing profit contributions[59]. - The scale of self-issued trust plans in 2023 was RMB 29.367 billion, representing a year-on-year growth of 3.59%, with standard products accounting for RMB 13.893 billion[59]. - The scale of family trusts reached RMB 38.849 billion, a year-on-year increase of 47%, placing the company in the leading tier of the industry[59]. - The company managed 2,241 trusts as of December 31, 2023, with a total managed asset scale of RMB 185.552 billion, down from RMB 209.477 billion in 2022[126]. - The financing trust revenue was RMB 485 million, representing 62.9% of total trust revenue, while investment trust revenue was RMB 168 million, accounting for 21.8%[127]. - The company actively implemented the "dual carbon" strategy, with green trust assets reaching RMB 2.830 billion by year-end[61]. - The company added RMB 1.217 billion in new green trust business in 2023, with a total green trust asset scale of RMB 2.83 billion by year-end[90]. Charitable Trusts and Social Responsibility - The company signed 20 new charitable trusts during the year, setting a record in both number and scale, contributing to the public welfare sector[26]. - Charitable trust funds delivered a cumulative scale of RMB 136 million in 2023, reflecting a year-on-year growth of 56.38%, benefiting nearly 7,000 recipients[59]. - The company received several awards, including the "2023 Regional Influence Trust Company" and "Best Charity Trust Product Award," reflecting its strong market position[71]. Governance and Risk Management - The company is committed to enhancing governance and risk management, aligning with the "New Three Classifications" guidelines and the "14th Five-Year Plan" for high-quality development[28]. - The company has established a strong leadership structure to navigate regulatory guidance and risk management effectively[33]. - The board of directors is committed to maintaining high standards of corporate governance and operational efficiency, recognizing the importance of diversity for competitiveness and sustainable development[148]. - The company has established a comprehensive risk management system to identify and manage operational risks, ensuring stable business development[156]. - The company has strengthened its risk management framework, enhancing pre-approval risk prevention capabilities and optimizing internal control processes[130]. Innovation and Development - The company plans to focus on transformation and innovation, enhancing core competitiveness and sustainable business development in 2024[33]. - The company continues to develop innovative trust products and new investment channels to meet changing customer needs[94]. - The company has actively expanded its family trust business, launching innovative products such as the "Canadian Tax Resident Family Trust" and "Foreign Grantor Trust + Listed Company Stock" family trust[118]. - The company aims to enhance its proprietary business income through optimized asset allocation, which is anticipated to have a major impact on future operational performance[172]. Awards and Recognition - The company received the "Golden Bull Award" for the second consecutive year in 2023, recognizing its achievements in the trust industry[59]. - The company has been recognized with multiple awards, including "Best Innovative Trust Company" and "AAA Level" in performance evaluation for several consecutive years[97]. - The company received the "Fixed Income Product Golden Bull Award" for the Taishan Bao project, recognizing its management capabilities in the industry[118]. Corporate Structure and Leadership - The new chairman, Yue Zengguang, has been approved and will assume office on January 10, 2024, ensuring compliance with corporate governance codes[197]. - The board of directors has a clear division of roles between the chairman and the general manager to ensure effective governance[197]. - The company has established a balanced power structure within the board to protect the interests of the company and its shareholders[197]. - The board of directors is composed of one executive director, three non-executive directors, and three independent non-executive directors, ensuring adequate checks and balances[197]. - All newly appointed directors receive necessary training to understand their responsibilities and the company's operations[194]. - The independent directors' term is three years, with the possibility of re-election, but cannot exceed six years in total[200]. - The company will disclose detailed information about director candidates to shareholders prior to the annual general meeting[200]. - The company encourages continuous professional development for all directors to keep their knowledge and skills updated[194].

Financial Performance - The total revenue for the year 2023 was RMB 1,190.5 million, a decrease of 21.1% year-on-year[9]. - The total profit for the year was RMB 290.2 million, while net profit was RMB 158.6 million, reflecting a year-on-year decline of 43.4%[9]. - The total profit of the company decreased from RMB 591.2 million in 2022 to RMB 290.2 million in 2023, representing a decline of approximately 50.9%[28]. - The company's net profit for 2023 was RMB 158.6 million, with a net profit margin of 13.3%, down from RMB 280.4 million and a margin of 18.6% in 2022[31]. - The total operating revenue for the year ended December 31, 2023, was RMB 1,190,457 thousand, down from RMB 1,508,706 thousand in 2022[56]. - The total profit for 2023 was RMB 290,150 thousand, a significant decline from RMB 591,234 thousand in 2022, resulting in an operating profit margin of 24.4%, down from 39.2%[64]. - The company's net income from equity method investments was RMB 1,577 thousand in 2023, a decrease from RMB 239,059 thousand in 2022[53]. - The company's proprietary business segment revenue decreased by 18.9% to RMB 426.6 million in 2023 from RMB 526.2 million in 2022[99]. - The company's trust business revenue decreased from RMB 983.1 million in 2022 to RMB 766.8 million in 2023, representing a decline of approximately 22.1%[198]. - The proprietary business revenue also saw a decrease, with total revenue dropping from RMB 526.2 million in 2022 to RMB 426.6 million in 2023, a decline of about 19%[198]. - Net profit decreased significantly from RMB 280.4 million in 2022 to RMB 158.6 million in 2023, reflecting a reduction of approximately 43.4%[197]. Assets and Liabilities - The total assets as of December 31, 2023, amounted to RMB 14,168.884 million, down from RMB 14,458.132 million in 2022[3]. - The total liabilities decreased to RMB 3,079.506 million from RMB 3,523.864 million in the previous year[3]. - The total equity increased to RMB 11,089.378 million from RMB 10,934.268 million year-on-year[3]. - The total assets of the company decreased from RMB 14,458,132,272.78 at the beginning of the year to RMB 14,168,884,311.21 at the end of the year[67]. - The company's short-term borrowings decreased from RMB 2,005,323,555.59 in 2022 to RMB 974,779,055.55 in 2023[67]. - The company's total liabilities decreased from RMB 3,523,864,401.23 in 2022 to RMB 3,079,506,350.73 in 2023[67]. - The company's total liabilities significantly increased due to the inclusion of trust plan liabilities in the consolidated balance sheet, categorized as "other liabilities"[170]. - The group's total liabilities decreased from RMB 3,524 million in 2022 to RMB 3,080 million in 2023[142]. Revenue Sources - The financing trust revenue for 2023 was RMB 485 million, accounting for 62.9% of total revenue, while investment trust revenue was RMB 168 million, representing 21.8%[14]. - The net commission and fee income for the year ended December 31, 2023, was RMB 766.1 million, a decrease of 22.0% compared to RMB 981.7 million in 2022[80]. - Investment income for 2023 was RMB 72.4 million, down RMB 447.9 million from RMB 520.3 million in 2022, primarily due to a decrease in equity method investment income[83]. - The trust business revenue decreased to 49.6% in 2023 from 71.2% in 2022, while proprietary business losses were RMB 90.1 million in 2023 compared to RMB 108.6 million in 2022[97][99]. Business Operations - The company added RMB 1.217 billion in new green trust business in 2023, with a total green trust asset scale of RMB 2.83 billion by year-end[7]. - The company managed a total of 105 wealth management trusts for legal and non-legal entities, with a trust asset scale of approximately RMB 25.686 billion as of December 31, 2023[19]. - The company has established strategic partnerships with major commercial banks and is actively expanding cooperation with leading securities and insurance companies[17]. - The company has developed a new comprehensive management platform for family trusts, enabling full online management of client applications and asset inquiries[17]. - The company is focusing on supporting new infrastructure projects, including 5G networks and artificial intelligence, to enhance service to the real economy[45]. - The company aims to actively respond to national macro policies and support the construction of long-term rental and affordable housing[24]. - The company is expected to enhance its inherent business income through optimized asset allocation, which will significantly affect future operational performance[155]. - The company has maintained a focus on active management trust products, which typically yield higher trust fees compared to passive management products[154]. - The company is focusing on customized trust products to effectively compete with various financial institutions offering asset and wealth management services[184]. Risk Management - The company has established a comprehensive risk management system to ensure stable business development and effective risk identification and management[176]. - The company is committed to managing credit risk through thorough due diligence and strict internal approval processes[186]. - The company has implemented a smart risk control system to enhance investment decision-making and risk management capabilities[186]. Market Conditions - The company is facing challenges due to the economic slowdown and structural adjustments in China, which may reduce demand for various trust products[178]. - The company anticipates that the economic transformation may present new business opportunities, although uncertainties remain regarding its ability to respond effectively to changes in the overall economic and financial market conditions[178]. - Interest rate fluctuations are impacting the company's business performance, affecting client investment returns and the value of financial assets held[185]. - Regulatory changes in China are influencing the company's trust business structure and operational model, potentially affecting revenue and profitability positively or negatively[152]. Consolidation and Trust Plans - The total number of consolidated trust plans increased from 19 at the beginning of the year to 22 at the end of the year, with 7 new plans added and 4 plans terminated during the year[168]. - The impact of the consolidation of trust plans on the company's net profit was a reduction of RMB 75 million in 2023, compared to a reduction of RMB 4 million in 2022[171]. - The group's net profit after the consolidation of trust plans was RMB 159 million for the year ended December 31, 2023, down from RMB 280 million in 2022, indicating a decrease of 43.2%[171]. - The merger of trust plans has led to a reduction in the company's commission and fee income due to the elimination of trust fees, while interest income and expenses have increased, resulting in a minimal net profit impact[143].

Financial Performance - The company achieved a net interest income of RMB 35.0 million in the first half of 2023, a significant increase from a net interest expense of RMB 21.0 million in the same period last year, driven by a 100.3% rise in interest income to RMB 75.3 million[11]. - The company's net fee and commission income decreased by 18.8% to RMB 418.6 million in the first half of 2023, compared to RMB 515.6 million in the same period of 2022[13]. - Total investment income from financial assets held during the period was RMB 133.8 million, down from RMB 227.9 million in the previous year[14]. - Credit impairment losses dropped by 79.4% to RMB 278.0 million in the first half of 2023, compared to RMB 1,347.3 million in the same period last year[18]. - The total profit for the first half of 2023 was RMB 275.9 million, with an operating profit margin of 33.0%, a significant recovery from a loss of RMB 695.9 million and a margin of -86.4% in the previous year[20]. - The trust business's total profit decreased by 62.5% to RMB 137.4 million, with segment revenue falling by 19.0% to RMB 418.7 million[27]. - The proprietary business reported a profit of RMB 138.5 million in the first half of 2023, a turnaround from a loss of RMB 1,062.4 million in the same period last year, with segment revenue increasing by 45.2% to RMB 420.4 million[29]. - The group's net profit for the six months ended June 30, 2023, was RMB 175 million, compared to RMB 280 million for the same period in 2022, reflecting a decline of 37.5%[74]. Assets and Liabilities - The total assets of the group as of June 30, 2023, were RMB 13,704.4 million, down from RMB 14,458.1 million as of December 31, 2022[49]. - The company's total assets as of June 30, 2023, were RMB 12,907.9 million, compared to RMB 14,065.9 million as of December 31, 2022[49]. - The group's total liabilities as of June 30, 2023, were RMB 2,595 million, down from RMB 3,524 million as of December 31, 2022, representing a reduction of approximately 26.3%[72]. - The company's total equity as of June 30, 2023, was RMB 11,109 million, up from RMB 10,934 million as of December 31, 2022, showing an increase of approximately 1.6%[72]. - The trust plan's total assets increased from RMB 1,892 million as of December 31, 2022, to RMB 2,779 million as of June 30, 2023, indicating a growth of approximately 47%[70]. - The trust plan's total liabilities rose from RMB 234 million as of December 31, 2022, to RMB 290 million as of June 30, 2023, an increase of about 24%[72]. Corporate Governance - The company adopted Chinese Accounting Standards for financial reporting, which will not significantly impact its financial position, operating results, and cash flows for 2023 and beyond[40]. - The board of directors has established a comprehensive corporate governance structure, ensuring clear responsibilities among the shareholders' meeting, board of directors, supervisory board, and senior management[44]. - The company has revised its articles of association and governance rules to comply with regulatory requirements and improve corporate governance practices[41]. - The company plans to continue enhancing transparency in corporate governance to protect shareholder interests and increase corporate value[44]. - The company has adopted the Corporate Governance Code as per the listing rules, ensuring compliance with all provisions during the reporting period[45]. - The supervisory board focused on the authenticity, accuracy, and completeness of financial reports, guiding external audit work and monitoring internal control systems[52]. Risk Management - The company strictly adheres to credit risk management guidelines and has implemented a self-developed intelligent risk control system to enhance investment decision-making and risk management capabilities[114]. - The company has implemented strict risk control mechanisms to minimize operational risks and enhance the effectiveness of operational risk management[117]. - The company has established a comprehensive risk management system to ensure stable business development and effectively identify and manage operational risks[125]. - The company's management structure integrates comprehensive risk management across various levels, ensuring that all trust business departments bear primary risk management responsibilities[104]. - The company is expected to continue adjusting its trust business structure and operational model to comply with regulatory requirements, which may have both positive and negative impacts on its business scale and profitability[108]. Employee and Workforce Management - As of June 30, 2023, the total number of employees decreased to 334 from 385 a year earlier, representing a reduction of approximately 13.2%[159]. - The number of wealth management employees decreased by 29.2% from 89 to 63, indicating a significant shift in workforce allocation[159]. - The company has implemented a dual-channel development system for employee promotion, enhancing career development opportunities[182]. - The company continues to strengthen its internal mechanisms to attract financial talent, supporting its business transformation and development[182]. - Employees with a master's degree account for 75.15% of the workforce, an increase from 71.17% in the previous year[186]. Market and Economic Environment - The company anticipates ongoing challenges due to economic slowdown and structural adjustments in China, which may impact demand for various trust products[84]. - The company acknowledges ongoing global economic risks, including rising debt burdens and high inflation, which contribute to market uncertainty[188]. - The competitive landscape in the trust industry is intensifying, with many companies actively innovating and expanding their services, which may impact the company's market position[111]. - Interest rate fluctuations pose risks to the company's operations, as changes in deposit rates can influence client investment returns and the value of financial assets held[138]. Strategic Focus and Future Outlook - The company aims to capitalize on the growing wealth management demand from high-net-worth individuals as the middle-income group in China expands[162]. - The company is focusing on designing and developing more customized trust products to diversify its offerings and enhance active asset management services, which is expected to have a significant impact on future financial performance[111]. - The company aims to optimize asset allocation to seek further increases in proprietary business income, which is anticipated to significantly affect future operational performance and financial condition[111]. - The company has identified potential new business opportunities during the economic transition period, aiming to offset the impacts of economic downturns[84].

Financial Performance - The net income for the current period was 3,766,589,071.42, compared to 3,832,734,832.93 in the previous period, indicating a slight decline [33]. - In the first half of 2023, the company achieved total revenue of RMB 836.2 million, an increase of 3.8% year-on-year, with a net profit of RMB 175.1 million compared to a loss of RMB 474.3 million in the same period last year [92]. - The company reported a net profit of RMB 175.1 million, compared to a net loss of RMB 474.3 million in the same period last year [186]. - The company reported a total income of RMB 421 million for the first half of 2023, with financing trusts contributing 62.5% (RMB 263 million), investment trusts 19.5% (RMB 82 million), and management trusts 18.0% (RMB 76 million) [154]. - The proprietary business revenue increased from RMB 289.1 million in the previous year to RMB 417.4 million, reflecting a strong growth trajectory [94]. Assets and Liabilities - The company reported a total cash and cash equivalents of 249,949,949.65, a decrease from 2,240,590,484.12 at the beginning of the period [14]. - As of June 30, 2023, total assets amounted to RMB 13,704.35 million, a decrease from RMB 14,458.13 million as of December 31, 2022 [84]. - Total liabilities decreased to RMB 2,594.87 million from RMB 3,523.86 million year-over-year [84]. - The company’s total liabilities included short-term borrowings of 703,876,406.25, a decrease from 2,005,323,555.59 in the previous period, showing a reduction in debt [35]. - The company’s cash and cash equivalents, including bank deposits and other monetary funds, decreased significantly from RMB 2,208.30 million to RMB 180.49 million [148]. Income Sources - The company’s commission income for the current period was 421,228,725.81, down from 519,484,471.58 in the previous period, reflecting a decrease of approximately 19% [23]. - The company’s equity method investment income was reported at 10,152,591.24, down from 191,254,365.92 in the previous period, indicating a significant decline [37]. - The company’s interest income was RMB 35,014 thousand, a decrease from RMB 21,036 thousand in the previous year [188]. - Interest income for the first half of 2023 was RMB 75.3 million, an increase of 100.3% from RMB 37.6 million in the first half of 2022 [199]. - The company’s investment income for the first half of 2023 was RMB 133,775 thousand, down from RMB 227,918 thousand in the same period last year [191]. Expenses - Total expenses for the current period amounted to $163,970,832.11, up from $147,673,633.04 in the previous period, indicating an increase of about 10.9% [40]. - Employee compensation for the current period is $93,045,145.13, a slight decrease from $93,458,857.26 in the previous period, reflecting a reduction of approximately 0.44% [40]. - Depreciation and amortization expenses increased significantly to $31,832,465.83 from $17,157,104.72, representing an increase of approximately 85.5% [40]. - Legal and professional service fees decreased to $4,512,787.36 from $6,671,734.44, a reduction of approximately 32.4% [40]. - The total operating costs amounted to RMB 447,435 thousand, significantly lower than RMB 1,501,526 thousand in the previous year [195]. Risk Management and Compliance - The company strictly adheres to regulatory requirements regarding credit risk management, aiming to control and mitigate credit risks effectively [60]. - The company has established compliance policies to monitor and ensure adherence to legal and regulatory standards in its operations [61]. - The company is focusing on enhancing risk management systems and compliance, with a strong emphasis on anti-money laundering and anti-terrorist financing efforts [91]. - The company’s provisions for expected credit losses on principal increased to 2,368,004,290.13 from 2,176,001,905.89, indicating a rise in risk provisions [17]. - The company reported a credit impairment loss of RMB 278,020 thousand, down from RMB 1,347,287 thousand in the previous year [196]. Business Development and Strategy - The company is committed to enhancing its business development and financial innovation to improve profitability and competitive standing [59]. - The company is actively expanding its wealth management services, including the launch of the "Anxin" series of wealth management products [90]. - The company has established a comprehensive cooperation system with various financial institutions, including banks and securities companies, to strengthen its market position [88]. - The company aims to deepen reforms and improve management efficiency as part of its strategic initiatives to stimulate new growth momentum [120]. - The company is committed to supporting long-term rental housing and affordable housing construction in response to national macro policies [156]. Market Position and Competition - The company faces increased competition from other trust companies in China, which may impact its market position and profitability [59]. - The trust industry in China managed a total of RMB 21.22 trillion in trust assets as of the end of the first quarter of 2023, indicating a robust market environment [86]. - The company has formed strategic partnerships with major state-owned commercial banks and large securities firms to enhance customer service capabilities [131]. - The company is committed to consumer rights protection and financial knowledge promotion through various public awareness campaigns [90]. - The company is actively enhancing financial support for the real economy, particularly focusing on small and medium-sized enterprises and technological innovation [106]. Trust and Asset Management - The company reported a 46.29% increase in the scale of family trusts managed, reaching RMB 347.02 million by the end of June 2023 [88]. - The scale of actively managed standardized trust products increased to nearly RMB 400 million, positioning the company among the top in its category [88]. - The company has established nearly 2,500 family trusts with a total scale close to RMB 35 billion as of June 30, 2023, maintaining a leading position in the industry [160]. - The company has established 23 personal wealth management service trusts, with a total asset scale of approximately RMB 4.07 billion as of June 30, 2023 [140]. - The company has established five asset-backed securities projects with a cumulative scale of RMB 92.02 billion as of June 30, 2023 [141].