Company Overview - China Huarong Asset Management Co., Ltd. was established in November 1999 and is one of the four major state-owned financial asset management companies in China[7]. - The company primarily engages in distressed asset management, financial services, and investment management, with distressed asset management being its core business[7]. - As of December 31, 2021, the company had approximately 33 subsidiaries and a workforce of around 10,000 employees[7]. - The company has a significant shareholder structure, including the Ministry of Finance and China CITIC Group[7]. - The company operates a service network covering 30 provinces, autonomous regions, and municipalities in China, as well as Hong Kong and Macau[7]. Financial Performance - The total revenue for 2021 was RMB 93,066.9 million, an increase from RMB 75,405.1 million in 2020, representing a growth of approximately 23.5%[20]. - The net profit attributable to shareholders for 2021 was RMB 378.5 million, recovering from a loss of RMB 102,903.0 million in 2020[21]. - The interest income for 2021 was RMB 35,023.7 million, a slight decrease from RMB 36,489.2 million in 2020, reflecting a decline of about 4.0%[20]. - The company reported a significant reduction in credit impairment losses, totaling RMB 16,678.0 million in 2021, compared to RMB 97,298.4 million in 2020, indicating a decrease of approximately 82.9%[20]. - The total expenses for 2021 were RMB 83,633.6 million, down from RMB 176,938.6 million in 2020, marking a reduction of about 52.8%[20]. - The company achieved a pre-tax profit from continuing operations of RMB 6,898.5 million in 2021, a significant recovery from a loss of RMB 102,880.5 million in 2020[21]. - The average return on equity for 2021 was 1.0%, a significant recovery from a negative 147.6% in 2020[25]. - The average asset return for 2021 was 0.1%, improving from a negative 6.4% in 2020[25]. - Basic earnings per share for 2021 was RMB 0.01, recovering from a loss of RMB 2.63 in 2020[25]. - The company reported a net asset change attributable to other holders of consolidated structured entities of RMB (2,669.4) million in 2021, worsening from RMB (500.5) million in 2020[21]. Asset and Liability Management - Total assets as of December 31, 2021, amounted to RMB 1,568,421.8 million, a decrease of 4.4% from RMB 1,641,467.0 million in 2020[22]. - Total liabilities reached RMB 1,464,437.4 million, down 7.1% from RMB 1,577,210.1 million in 2020[24]. - The company's equity totaled RMB 103,984.4 million, an increase of 62% from RMB 64,256.9 million in 2020[24]. - The debt-to-asset ratio improved to 93.4% in 2021 from 96.1% in 2020[25]. - The company reported a significant reduction in financial liabilities measured at fair value through profit or loss, decreasing to RMB 683.7 million from RMB 3,301.5 million in 2020[24]. Non-Performing Asset Management - The main business of managing non-performing assets accounted for nearly 60% of the company's revenue, with 50% of the scale contributing to this income[28]. - The company successfully disposed of 93 bankruptcy restructured projects, reducing debts for enterprises by over 500 billion yuan[31]. - The scale of acquired non-performing asset packages reached 77.9 billion yuan, maintaining a leading market share in the industry[31]. - The non-performing asset management segment generated total revenue of RMB 51,747.6 million, a decrease of 14.3%, but achieved a pre-tax profit of RMB 7,206.3 million, an increase of 135.4%[38]. - The total amount of non-performing loans acquired in 2021 was RMB 86,902.2 million, a decrease of 55.8% from RMB 196,177.3 million in 2020[108]. Risk Management - The company is focused on risk management and capital management strategies to navigate the economic and regulatory environment[9]. - The group established a comprehensive risk management system to address challenges such as delayed annual report disclosures and liquidity stability[170]. - Credit risk management is crucial for the group, particularly in areas like bad debt acquisition and restructuring, trust business, and consumer finance[173]. - The company implemented a risk management mechanism, including a dynamic monitoring system for customer risk and asset quality, enhancing risk warning and assessment mechanisms[175]. - The expected credit loss model is used for impairment assessment of debt instruments, considering factors such as credit risk, collateral value, and borrower guarantees[178]. Strategic Development - The company plans to enhance its core competitiveness by optimizing product structure and asset layout, actively participating in the bulk transfer market for non-performing assets[29]. - The company aims to deepen risk management by utilizing various methods such as substantial restructuring and debt-to-equity swaps to enhance the value of existing assets[30]. - The company anticipates entering a new development phase following the successful introduction of strategic investors, aiming for high-quality development[30]. - The company emphasizes the importance of aligning with national development strategies and enhancing service quality to support the real economy[28]. - The company aims to enhance its role as a resource integrator and comprehensive solution provider in the "big non-performing" industry[107]. Employee Management - As of December 31, 2021, the total number of employees in the group was 10,904, with 2,567 employed by the company and 8,337 by subsidiaries[165]. - The educational background of employees indicates that 58.59% hold a bachelor's degree, while only 1.51% have a doctoral degree[167]. - The group emphasizes a performance-based compensation system, aligning salary distribution with job responsibilities and employee contributions[168]. - In 2021, the group focused on enhancing training programs to improve employee capabilities and operational skills[169]. Shareholder Structure - The Ministry of Finance holds 9,901,084,435 domestic shares, representing 12.34% of the total share capital[195]. - China CITIC Group holds 18,823,529,411 domestic shares, accounting for 23.46% of the total share capital[195]. - Warburg Pincus Financial International Ltd directly holds 2,060,000,000 H-shares of the company[197]. - Fabulous Treasure Investments Limited and Shining Grand Limited directly hold 1,716,504,000 H-shares and 54,906,000 H-shares respectively[198]. Future Outlook - The company anticipates that the global economic recovery in 2022 will face risks and uncertainties, with high inflation expected to decline gradually[190]. - The company expects the scale of non-performing assets in the economic financial system to continue to rise in 2022 due to the lingering effects of the pandemic and economic downturn[190]. - The company will implement proactive fiscal policies to support enterprise relief, stabilize employment, and promote consumption[190]. - The company emphasizes a high-quality development path, focusing on the integration of business transformation and asset management[191].

Financial Performance - The company reported a total revenue of RMB 10.5 billion for the first half of 2021, representing a year-on-year increase of 15%[12]. - The net profit attributable to shareholders was RMB 2.1 billion, up 20% compared to the same period last year[12]. - Total revenue for the six months ended June 30, 2021, was RMB 46,062.5 million, a slight increase from RMB 45,687.8 million in the same period of 2020, representing a growth of 0.82%[16]. - Interest income for the period was RMB 18,468.7 million, compared to RMB 18,412.2 million in the previous year, showing a marginal increase of 0.31%[16]. - The company reported a pre-tax profit of RMB 4,296.4 million, up from RMB 3,886.9 million in the prior year, reflecting an increase of 10.54%[16]. - Net profit attributable to shareholders was RMB 158.3 million, down from RMB 209.9 million in the same period last year, indicating a decrease of 24.54%[16]. - The company achieved total revenue of RMB 46,062.5 million in the first half of 2021, representing a year-on-year growth of 0.8%[23]. - Net profit for the period was RMB 1,624.2 million, a significant increase of 105.0% compared to the previous year[23]. - The company reported a decrease in net profit attributable to shareholders of RMB 158.3 million, down 24.6% year-on-year[23]. Asset and Liability Management - The company’s total assets reached RMB 300 billion, with a return on average assets (ROAA) of 0.7%[12]. - Total assets as of June 30, 2021, amounted to RMB 1,605,617.2 million, a decrease from RMB 1,641,467.0 million at the end of 2020, representing a decline of 2.18%[17]. - Total liabilities were RMB 1,539,863.9 million, down from RMB 1,577,210.1 million at the end of 2020, reflecting a decrease of 2.36%[18]. - The debt-to-asset ratio was reported at 95.9%, slightly improved from 96.1% at the end of 2020[19]. - Total liabilities decreased by 2.4% from RMB 1,577,210.1 million as of December 31, 2020, to RMB 1,539,863.9 million as of June 30, 2021[50]. - The equity attributable to shareholders increased by 5.8% from RMB 18,154.7 million as of December 31, 2020, to RMB 19,212.2 million as of June 30, 2021[50]. Risk Management - The company is actively managing risks associated with economic fluctuations and regulatory changes to ensure stable growth[12]. - The group focused on risk management, establishing a comprehensive risk management system to enhance risk monitoring and control[139]. - Credit risk management was strengthened, with measures to tighten client risk limits and improve risk identification capabilities[142]. - The company enhanced its legal risk prevention system, optimizing legal review processes and strengthening contract management[146]. - The company implemented a centralized liquidity management mechanism to ensure that the degree of asset-liability mismatch remained within acceptable liquidity risk levels[145]. Business Strategy and Expansion - The company plans to expand its market presence in Southeast Asia, targeting a 25% increase in regional revenue by 2023[12]. - New product offerings in asset management are expected to contribute an additional RMB 1 billion in revenue by the end of 2022[12]. - The company has identified potential acquisition targets in the fintech sector to diversify its service offerings[12]. - The company plans to continue its business transformation and actively manage asset disposals to improve financial performance[28]. - The company continues to focus on strategic emerging industries and technology innovation enterprises, optimizing its business layout[110]. Non-Performing Assets - The company has successfully converted RMB 5 billion of non-performing loans into equity through its debt-to-equity swap program[12]. - The total amount of non-performing assets as of June 30, 2021, was RMB 529,137.3 million, a decrease from RMB 551,409.6 million as of December 31, 2020, representing a decline of approximately 4.0%[82]. - The total amount of non-performing assets decreased by 5.7% from RMB 364,624.1 million on December 31, 2020, to RMB 343,663.6 million on June 30, 2021[99]. - The total cost of newly acquired non-performing assets in 2021 was RMB 48,548.3 million, down 48.2% from RMB 93,769.4 million in 2020[86]. - The company achieved a realized income of RMB 3,895.8 million from the disposal of non-performing assets in the first half of 2021, representing a 77.9% increase from RMB 2,190.1 million in the same period of 2020[95]. Corporate Governance - The company has a governance structure that includes 11 board members, with independent non-executive directors accounting for over one-third of the board[173]. - The company is committed to enhancing corporate governance and compliance with relevant laws and regulations[172]. - The company held 2 board meetings during the reporting period, discussing 15 proposals including the appointment of the new president and chief risk officer[173]. - The company has established a sanctions risk blacklist that is updated daily, and has engaged lawyers to assess sanctions risk every six months[179]. Employee Management - As of June 30, 2021, the total number of employees in the group was 11,013, with 2,628 employed by the company and 8,385 by subsidiaries[133]. - Employee age distribution shows that 46.9% are 35 years old or younger, while 5.2% are 56 years old or older[134]. - The educational background of employees indicates that 58.0% hold a bachelor's degree or above, while only 1.6% have a doctoral degree[135]. - In the first half of 2021, the group enhanced its training programs, implementing an annual training plan to improve employee capabilities[137]. Legal and Compliance - The company completed the 2020 anti-money laundering report on time and implemented the latest regulatory requirements for anti-money laundering[149]. - The company conducted regular audits and special audits on subsidiaries, focusing on governance, key business areas, and risk management[148]. - The company has not experienced any significant litigation or arbitration matters that adversely affect its business or financial status during the reporting period[182].

Financial Performance - The company reported a significant increase in total assets, reaching RMB 1.2 trillion, representing a growth of 15% year-over-year[15]. - The net profit for the first half of the year was RMB 5 billion, a 10% increase compared to the same period last year[15]. - Total revenue for the six months ended June 30, 2020, was RMB 45,687.8 million, a decrease of 19.6% from RMB 56,810.2 million in the same period of 2019[17]. - Net profit for the period was RMB 792.1 million, down 71.8% from RMB 2,812.2 million year-on-year[17]. - The company has set a performance guidance of 12% revenue growth for the next fiscal year[15]. - The company reported a significant reduction in interest expenses to RMB (27,992.3) million from RMB (30,280.2) million, reflecting cost management efforts[17]. - The total revenue for the group in the first half of 2020 was RMB 45,687.8 million, a decrease from RMB 56,810.2 million in the same period of 2019[91]. Asset Quality and Risk Management - The company’s non-performing loan ratio improved to 2.5%, down from 3.0% in the previous year[15]. - Impairment losses under expected credit loss model decreased to RMB 6,079.7 million from RMB 12,544.3 million, indicating improved asset quality[17]. - Risk management strategies have been enhanced, focusing on reducing exposure to high-risk sectors by 30%[15]. - The company achieved a significant reduction in expected credit loss provisions, down 51.5% to RMB 6,079.7 million[26]. - The company has implemented measures to address potential increases in non-performing loans due to the economic impact of COVID-19[24]. - The company continues to focus on risk resolution and project recovery, leading to significant reversals of impairment provisions[51]. Business Strategy and Expansion - The company plans to expand its market presence in Southeast Asia, targeting a 25% market share by 2025[15]. - New product launches are expected to contribute an additional RMB 1 billion in revenue by the end of the fiscal year[15]. - The company has allocated RMB 500 million for research and development of new technologies in the upcoming year[15]. - A strategic acquisition of a fintech startup is anticipated to enhance the company’s digital service offerings[15]. - The company is focusing on strategic emerging industries such as information technology, high-end equipment, new materials, new energy, and biomedicine for future growth[127]. Non-Performing Assets - The total amount of non-performing assets increased to RMB 184,959.2 million as of June 30, 2020, representing a growth of 6.9% from RMB 173,071.7 million on December 31, 2019[71]. - The total amount of non-performing loans was RMB 540,660.3 million as of June 30, 2020, down from RMB 551,813.7 million on December 31, 2019[95]. - The company’s acquisition and disposal business accounted for 25.4% of the total acquisition cost of non-performing assets, while the restructuring business accounted for 74.6%[105]. - The total amount of newly acquired non-performing assets was RMB 23,828.6 million in 2020, compared to RMB 16,884.7 million in 2019, indicating a year-over-year increase of 41.0%[109]. Corporate Governance - The company has a board of directors including executive and non-executive members, ensuring governance and oversight[185]. - The company continuously improves its corporate governance system, integrating party leadership with corporate governance practices[195]. - The company emphasizes compliance with laws and regulations, enhancing risk management and internal controls to protect stakeholder interests[198]. - The company held 4 board meetings during the reporting period, approving 37 proposals, including the 2019 annual performance announcement and financial settlement plan[197]. Employee and Training Initiatives - As of June 30, 2020, the total number of employees in the group was 10,687, with 2,639 employed by the company and 8,048 by subsidiaries[153]. - The group focused on enhancing professional training, implementing an annual training plan, and establishing an online learning platform in the first half of 2020[157]. - The group aims to build a high-quality talent team to support its strategic goals and improve employee engagement and performance[152]. Economic Outlook and Challenges - The International Monetary Fund (IMF) forecasts a global economic contraction of 4.9% for 2020, indicating significant economic challenges ahead[171]. - The company anticipates a rise in non-performing loans due to economic downturn effects, with a focus on seizing business opportunities in liquidity assistance and restructuring[171].

Company Overview - In 2019, China Huarong ranked 83rd in the Fortune 500 China list and was included in the top 300 of the interbank market trading list[11]. - The company aims to focus on its core business of non-performing asset management, serving the real economy, and preventing financial risks[11]. - China Huarong has established 31 subsidiaries, providing services across 30 provinces, autonomous regions, and municipalities in China, including Hong Kong and Macau[10]. - The company is committed to building a sustainable business model and achieving high-quality development[11]. - The total number of employees in the group is approximately 10,000[10]. - China Huarong's main business includes non-performing asset management, financial services, and investment management[10]. - The company was restructured into a joint-stock company in September 2012, with its shares listed on the Hong Kong Stock Exchange in October 2015[10]. - The company is one of the four major state-owned financial asset management companies established to address financial risks and promote state-owned bank reforms[10]. - The company plans to deepen reforms and transformations in the future[11]. Financial Performance - The company reported a cash dividend of RMB 0.110 per share for the fiscal year 2019, subject to shareholder approval[20]. - The financial report for 2019 was audited by Deloitte with a standard unqualified opinion[20]. - Total revenue for 2019 reached RMB 112,656.5 million, an increase from RMB 107,253.1 million in 2018, representing a growth of approximately 2.5%[26]. - Interest income decreased to RMB 38,530.0 million in 2019 from RMB 44,809.2 million in 2018, a decline of about 14%[26]. - The company reported a net profit of RMB 2,269.3 million for 2019, up from RMB 1,509.0 million in 2018, marking an increase of approximately 50%[26]. - The total assets as of December 31, 2019, were RMB 1,705,012.4 million, slightly down from RMB 1,710,086.7 million in 2018[27]. - The company’s cash and deposits with central banks increased to RMB 30,774.7 million in 2019 from RMB 29,909.1 million in 2018, reflecting a growth of about 2.9%[27]. - The provision for credit impairment losses rose to RMB 24,966.2 million in 2019, compared to RMB 17,297.8 million in 2018, indicating an increase of approximately 44%[26]. - The company’s equity attributable to shareholders was RMB 1,424.4 million in 2019, down from RMB 1,575.5 million in 2018, a decrease of about 9.6%[26]. - The company’s financing lease income decreased to RMB 5,911.6 million in 2019 from RMB 6,784.4 million in 2018, a decline of approximately 12.8%[26]. - The company’s investment income for 2019 was RMB 44,179.7 million, significantly higher than RMB 24,678.4 million in 2018, representing an increase of approximately 79%[26]. - The company’s total liabilities decreased to RMB 1,705,012.4 million in 2019 from RMB 1,710,086.7 million in 2018, indicating a slight reduction[27]. Business Segments - The company achieved a market share of 30% in asset package acquisitions, maintaining a leading position in the industry[34]. - The income from non-performing asset management business grew by 7.8% to RMB 69.791 billion, with its contribution to total group revenue increasing by 1.6 percentage points to 62.0%[34]. - The financial services segment generated total revenue of RMB 335.76 billion, reflecting a year-on-year increase of 10.9%[34]. - The pre-tax profit for the financial services segment was RMB 57.43 billion, which is a 27.6% increase from the previous year[34]. - The total revenue from the distressed asset management segment increased by 7.8% to RMB 69,790.8 million, while the financial services segment revenue rose by 10.9% to RMB 33,575.5 million[74]. Risk Management and Compliance - The company strengthened internal management and risk control, achieving growth in both bank credit scale and external financing balance[36]. - The company is committed to improving risk management capabilities and establishing a comprehensive risk management system[38]. - The company aims to gradually reduce non-core and non-advantageous business assets to consolidate its core business advantages[38]. - The group has established a three-tiered risk management system, integrating governance structure, professional teams, and operational defenses[179]. - The group has enhanced its credit risk management system, focusing on improving risk identification and control capabilities, and has made significant progress in risk asset disposal efficiency in 2019[180]. - The group established a dedicated internal control compliance department to strengthen operational risk management and conducted stress tests to identify and mitigate key operational risk areas in 2019[185]. Shareholder Information - The total number of shares outstanding as of December 31, 2019, was 39,070,208,462, with H shares accounting for 64.10% and domestic shares for 35.90%[193]. - The Ministry of Finance holds 9,901,084,435 domestic shares, representing 70.59% of the domestic share capital and 25.34% of the total share capital[195]. - The National Social Security Fund Council received a one-time transfer of 2,475,271,109 domestic shares, accounting for 17.65% of the domestic share capital and 6.34% of the total share capital[195]. - China Life Insurance (Group) Company holds 1,650,000,000 domestic shares, which is 11.76% of the domestic share capital and 4.22% of the total share capital[195]. - The proportion of shares held by major shareholders exceeding 5% has increased with the addition of the National Social Security Fund Council during the reporting period[200].

Company Overview - China Huarong Asset Management Co., Ltd. was established on November 1, 1999, and was listed on the Hong Kong Stock Exchange on October 30, 2015[7]. - The company operates 31 branches and provides financial services across 30 provinces, autonomous regions, and municipalities in China, including asset management and financial leasing[7]. Financial Performance - Total revenue for the year 2018 was RMB 107,253.1 million, a decrease of 16.3% compared to RMB 128,070.6 million in 2017[43]. - The company reported a net profit of RMB 1,509.0 million for 2018, a decline of 94.3% from RMB 26,587.7 million in 2017[43]. - The average return on equity dropped to 1.3% in 2018 from 18.1% in 2017, a decrease of 16.8 percentage points[48]. - Basic earnings per share fell to RMB 0.04 in 2018 from RMB 0.56 in 2017, a decline of 92.9%[48]. - The company’s tax expenses for the year were RMB 4,502.9 million, down from RMB 10,014.0 million in 2017[43]. Revenue Breakdown - Interest income increased significantly to RMB 79,258.8 million, up 6.4% from RMB 74,425.0 million in 2017[43]. - The company’s commission and fee income was RMB 4,693.3 million, a decrease of 64.1% from RMB 13,039.1 million in 2017[43]. - The company reported a significant increase in financing lease income to RMB 6,784.4 million, up from RMB 6,181.2 million in 2017[43]. - The non-performing asset management segment generated revenue of RMB 64,770.7 million, accounting for 60.4% of total revenue, while the financial services segment contributed RMB 30,274.7 million, or 28.2%[140]. Asset and Liability Management - Total assets decreased to RMB 1,710,086.7 million in 2018 from RMB 1,870,260.3 million in 2017, a decline of approximately 8.6%[44]. - Total liabilities decreased to RMB 1,541,481.7 million in 2018 from RMB 1,687,625.4 million in 2017, a decline of approximately 8.6%[47]. - The debt-to-asset ratio remained stable at 90.1% in 2018 compared to 90.2% in 2017[48]. - The total equity decreased to RMB 168,605.0 million in 2018 from RMB 182,634.9 million in 2017, a decline of approximately 7.7%[47]. Risk Management and Strategy - The company emphasizes the importance of risk control and reform transformation in its future strategy[9]. - The company is committed to ensuring the accuracy and completeness of its financial reports, taking legal responsibility for any misstatements[38]. - The company plans to enhance project recovery and risk mitigation efforts in response to the increased impairment losses[94]. - The company aims to strengthen its core business in non-performing assets and improve service to the real economy in 2019[60]. Investment and Capital Structure - The company has a total of 200 million preferred shares planned for issuance in overseas markets, with a total value not exceeding RMB 20 billion[35]. - The company issued USD 1.1 billion in overseas bonds and CNY 10 billion in secondary capital bonds, reflecting strong market confidence[51]. - The capital adequacy ratio stood at 13.62%, meeting regulatory requirements and improving compared to the same period last year[51]. Non-Performing Assets - The scale of non-performing asset business reached CNY 866.25 billion, generating revenue of CNY 64.77 billion, increasing its share of total revenue from 53.8% to 60.4%[51]. - The total amount of non-performing loans was RMB 532,946.4 million, an increase from RMB 468,892.2 million in 2017[142]. - The net profit from non-performing assets in 2018 amounted to RMB 8,652.8 million, up from RMB 4,583.1 million in 2017, indicating an increase of 88.8%[160]. Operational Challenges - The company faced increased interest expenses and market risks, leading to a substantial decline in profitability[67]. - The company reported a significant increase in other asset impairment losses, which rose by 203.3% to RMB 2,769.0 million[70]. - The actual tax rate increased significantly from 27.4% in 2017 to 74.9% in 2018, largely due to losses incurred by certain subsidiaries[99]. Future Outlook - The company plans to accelerate its transformation and development in 2019, aiming for high-quality growth and value creation for stakeholders[54]. - The company aims to enhance the value of non-performing assets through personalized restructuring methods, targeting companies with temporary liquidity issues[163]. - The company plans to adjust its strategy for special opportunity investments based on non-performing assets to mitigate existing risks and enhance collaboration with the parent company's non-performing asset business[185].