Financial Performance - Total assets of the group reached RMB 234.14 billion by the end of 2021, with total deposits amounting to RMB 193.11 billion and total loans and advances of RMB 156.85 billion, resulting in a net profit of RMB 1.29 billion[10]. - The bank's total assets were RMB 165.32 billion, with total deposits of RMB 133.77 billion and customer loans and advances totaling RMB 111.37 billion, achieving a net profit of RMB 1.43 billion by the end of 2021[17]. - In 2021, the net interest income was RMB 6,176.4 million, an increase of 21.2% from RMB 5,098.5 million in 2020[65]. - The annual profit for 2021 was RMB 1,290.0 million, representing an increase of 7.5% compared to RMB 1,199.7 million in 2020[65]. - The basic earnings per share remained stable at RMB 0.24 in 2021, unchanged from 2020[67]. - The capital adequacy ratio improved to 11.63% in 2021 from 11.37% in 2020, reflecting a stronger capital position[67]. - The net interest margin increased to 2.91% in 2021, compared to 2.75% in 2020, indicating improved profitability[67]. - The total operating income of the group was RMB 6,362.3 million, an increase of 14.7% from RMB 5,546.8 million in 2020[74]. - The total amount of loans and advances was RMB 156,850.2 million, which represents a 20.6% increase year-on-year[74]. - The non-performing loan ratio increased to 1.88% in 2021 from 1.63% in 2020, indicating a decline in asset quality[67]. Strategic Focus and Development - The bank's focus on rural revitalization and support for small and micro enterprises contributed to its recognition as a "Top Ten Precision Poverty Alleviation Institution" in rural finance[10]. - The bank plans to continue its transformation and high-quality development in 2022, emphasizing the integration of rural finance, community finance, cooperative platforms, and public welfare[18]. - The bank aims to balance scale and efficiency, speed and quality, as well as returns and risks in its future operations[18]. - The group plans to enhance community financial services and expand retail banking operations as part of its strategic vision[73]. - The group aims to strengthen risk management and internal controls while focusing on high-quality development[73]. Product and Service Innovation - The bank launched new products such as "Sunshine Loan," "Red Hatch Loan," and "Ji Mu Bao," enhancing its product offerings and supporting community financial services[17]. - The company continues to enhance digital capabilities and customer acquisition through improved service quality and targeted marketing strategies[111]. Risk Management and Compliance - The bank's compliance and risk management capabilities have improved, maintaining all regulatory indicators in a compliant and stable manner[17]. - The company plans to continue optimizing its asset structure and increasing credit investments to support future growth[94]. - The provision for impairment losses on loans increased by 32.2% from RMB 3,501.9 million as of December 31, 2020, to RMB 4,628.1 million as of December 31, 2021, reflecting a cautious approach to potential risks[166]. Community Engagement and Social Responsibility - The bank's community engagement and social responsibility initiatives have been recognized, with various charitable projects supporting education, the elderly, and the disabled[9]. - The company was awarded for its outstanding contributions to social responsibility and rural financial support in Jilin Province[54]. - The company has been acknowledged for its excellent service in rural revitalization and inclusive finance in 2021[59]. Ownership and Investments - The company holds a 51.00% stake in Anci District Huimin Village Bank, which was established in December 2011[6]. - The company has a 28.17% ownership in Anping Huimin Village Bank, established in December 2013, with a voting agreement in place with other shareholders[6]. - The company owns 49.00% of Baicheng Taobei Huimin Village Bank, established in November 2015, and has a voting agreement with other shareholders[6]. - The company has a 38.80% stake in Changbai Mountain Rural Commercial Bank, established in December 2011[6]. - The company holds a 40.00% stake in Changchun Gaoxin Huimin Village Bank, established in September 2013, with a voting agreement with other shareholders[6]. - The company owns 51.20% of Changchun Nanguan Huimin Village Bank, established in January 2011[6]. - The company has a 51.46% stake in Da'an Huimin Village Bank, established in January 2011[6]. - The company holds a 42.85% stake in Fuyu Huimin Village Bank, established in December 2015, with a voting agreement with other shareholders[6]. - The company owns 56.70% of Gaomi Huimin Village Bank, established in May 2011[6]. - The company has a 51.00% stake in Guangzhou Huangpu Huimin Village Bank, established in February 2014[6]. - The company holds a 35.00% stake in Huizhou Huimin Village Bank, which is considered a subsidiary under its control[29]. - The company owns 46.00% of Jilin Chuanying Huimin Village Bank, also classified as a subsidiary[29]. - The company has a 14.50% ownership in Jilin Chunchen Rural Commercial Bank, with the remaining 85.50% held by other shareholders[29]. - The company controls Jilin Fengman Huimin Village Bank with a 46.00% stake, while other shareholders hold 54.00%[31]. - The company has a 20.20% stake in Jilin Gongzhuling Rural Commercial Bank, with 79.80% held by other shareholders[31]. - The company owns 30.29% of Jilin Jiuyin Financial Leasing Company, which is also a subsidiary[31]. - The company holds a 33.15% stake in Jingmen Dongbao Huimin Village Bank, classified as a subsidiary[31]. - The company has a 34.36% ownership in Liaoyuan Rural Commercial Bank, which is under its control[32]. - The company controls Lijiang Huimin Village Bank with a 60.00% stake, while other shareholders hold 40.00%[32]. - The company has a 45.25% stake in Qian'an Huimin Village Bank, which is also considered a subsidiary[34]. - Jiutai Rural Commercial Bank holds 58.82% equity in Qingdao Pingdu Huimin Village Bank, which was established on December 23, 2010[36]. - Jiutai Rural Commercial Bank owns 53.53% of Qingyuan Qingxin Huimin Village Bank, established on January 23, 2014[36]. - Jiutai Rural Commercial Bank has a 20.00% stake in Sanya Huimin Village Bank, which is considered a subsidiary due to a voting agreement[36]. - Jiutai Rural Commercial Bank controls Shuangcheng Huimin Village Bank with a 62.26% equity stake, established on January 25, 2010[38]. - Jiutai Rural Commercial Bank holds 40.80% of Songyuan Ningjiang Huimin Village Bank, established on January 19, 2011[38]. - Jiutai Rural Commercial Bank has a 40.83% stake in Taonan Huimin Village Bank, established on December 11, 2015[40]. - Jiutai Rural Commercial Bank owns 47.00% of Tianjin Binhai Huimin Village Bank, established on June 11, 2014[42]. - Jiutai Rural Commercial Bank holds 75.76% equity in Tongcheng Huimin Village Bank, established on September 19, 2012[42]. - Jiutai Rural Commercial Bank has a 36.00% stake in Wen'an County Huimin Village Bank, established on December 23, 2011[42]. - Jiutai Rural Commercial Bank controls Wuchang Huimin Village Bank with a 66.67% equity stake, established on November 11, 2010[42]. Awards and Recognition - The company received multiple awards in 2021, including being recognized as one of the top 100 banks in China by the China Banking Association[54]. - The company was recognized as a leading institution in precision poverty alleviation and received accolades for its innovative financial products[57]. - The company has received recognition for its information security practices and innovative capabilities in the banking sector[57]. - The company has been awarded for its contributions to the rural financial system and support for small and micro enterprises[62].

[Chairman and President's Address](index=5&type=section&id=%E8%87%B4%E8%BE%9E) [Chairman's Address](index=5&type=section&id=%E8%91%A3%E4%BA%8B%E9%95%BF%E8%87%B4%E8%BE%9E) Chairman Gao Bing noted 2020 was an extraordinary year, with the bank achieving high-quality development amidst the pandemic and complex external environment, supporting "San Nong" and SMEs, and reaching **RMB 1.2 billion** net profit, while aiming for first-class modern rural commercial bank status in 2021 2020 Year-End Group Key Financial Data | Indicator | Amount (RMB) | | :--- | :--- | | Total Assets | 2,003.63 billion RMB | | Total Deposits | 1,497.63 billion RMB | | Total Loans and Advances | 1,300.77 billion RMB | | Net Profit | 1.20 billion RMB | - The bank maintained its market positioning of serving "San Nong" and SMEs in 2020, deepening community finance, strengthening risk prevention and control, and actively participating in epidemic prevention and control and targeted financial poverty alleviation[22](index=22&type=chunk) - Looking ahead to 2021, the bank will integrate into the "dual circulation" development pattern, coordinating the "four-in-one" construction of "San Nong" finance, community finance, cooperation platforms, and public welfare and charity[22](index=22&type=chunk) [President's Address](index=7&type=section&id=%E8%A1%8C%E9%95%BF%E8%87%B4%E8%BE%9E) President Liang Xiangmin reviewed 2020 operations, highlighting the bank's stable progress despite challenges, achieving **RMB 1.098 billion** net profit, and significant results in supporting the real economy and risk management, with a focus on deepening reform and transformation in 2021 2020 Year-End Bank Key Financial Data | Indicator | Amount (RMB) | | :--- | :--- | | Total Assets | 1,430.71 billion RMB | | Total Deposits from Customers | 993.76 billion RMB | | Total Customer Loans and Advances | 925.21 billion RMB | | Net Profit | 1.098 billion RMB | - The bank diligently implemented the "six stabilities" and "six guarantees" initiatives, prioritizing financial resource allocation to support business resumption and overcome difficulties with market entities[26](index=26&type=chunk) - In terms of social responsibility, the bank fully supported epidemic prevention and control, with cumulative donations exceeding **RMB 9.5 million**, and diligently carried out targeted financial poverty alleviation[26](index=26&type=chunk) [Chapter 1 Definitions and Technical Terms](index=8&type=section&id=%E7%AC%AC%E4%B8%80%E7%AB%A0%20%E9%87%8B%E4%B9%89%E5%8F%8A%E6%8A%80%E6%9C%AF%E8%AF%8D%E6%B1%87) This chapter provides definitions for key terms and technical vocabulary used throughout the report [Chapter 2 Company Profile](index=20&type=section&id=%E7%AC%AC%E4%BA%8C%E7%AB%A0%20%E5%85%AC%E5%8F%B8%E7%AE%80%E4%BB%8B) [II. History of the Bank](index=23&type=section&id=II.%20%E6%9C%AC%E8%A1%8C%E5%8E%86%E5%8F%B2) The bank was established on **December 16, 2008**, through the restructuring of the former Jiutai City Rural Credit Cooperative Union, and its H-shares were listed on the HKEX on **January 12, 2017**, though it is not regulated by the HKMA - The bank was established on **December 16, 2008**, through the restructuring of the former Jiutai City Rural Credit Cooperative Union[46](index=46&type=chunk) - The bank's H-shares were listed on the Main Board of the Hong Kong Stock Exchange on **January 12, 2017**, with stock code **06122**[43](index=43&type=chunk)[46](index=46&type=chunk) [III. Major Awards and Honors in 2020](index=24&type=section&id=III.%202020%E5%B9%B4%E6%89%80%E8%8E%B7%E4%B8%BB%E8%A6%81%E5%A5%96%E9%A1%B9%E5%8F%8A%E8%8D%A3%E8%AA%89) In 2020, the Group received multiple awards and honors for its outstanding business performance and management, recognizing its contributions to financial services, innovation, inclusive finance, targeted poverty alleviation, and social responsibility - Recognized by The Banker magazine as one of the "**Top 1000 World Banks in 2020**"[47](index=47&type=chunk) - Awarded "Advanced Enterprise in the 'Ten Thousand Enterprises Helping Ten Thousand Villages' Targeted Poverty Alleviation Action" by the All-China Federation of Industry and Commerce and the State Council Leading Group Office of Poverty Alleviation and Development for its contributions to targeted poverty alleviation[49](index=49&type=chunk) - Awarded "Advanced Enterprise in Fighting the COVID-19 Epidemic" by the All-China Federation of Industry and Commerce for its outstanding performance in combating the COVID-19 epidemic[50](index=50&type=chunk) [Chapter 3 Financial Summary](index=28&type=section&id=%E7%AC%AC%E4%B8%89%E7%AB%A0%20%E8%B4%A2%E5%8A%A1%E6%91%98%E8%A6%81) [Financial Data Summary](index=28&type=section&id=%E8%B4%A2%E5%8A%A1%E6%95%B0%E6%8D%AE%E6%91%98%E8%A6%81) In 2020, the Group's total assets grew to **RMB 200.36 billion**, with net profit at **RMB 1.2 billion**, while asset quality remained stable with a slight decrease in the NPL ratio to **1.63%**, and capital adequacy ratios met regulatory requirements despite a slight decline Comparison of Key Financial Indicators 2019-2020 | Item (RMB million) | 2020 | 2019 | Change | | :--- | :--- | :--- | :--- | | **Operating Performance** | | | | | Operating Income | 5,546.8 | 5,311.4 | +4.4% | | Net Profit | 1,199.7 | 1,195.7 | +0.3% | | **Assets and Liabilities** | | | | | Total Assets | 200,363.3 | 173,275.5 | +15.6% | | Loans and Advances | 126,574.6 | 93,394.2 | +35.5% | | Deposits from Customers | 149,763.2 | 122,840.4 | +21.9% | | Total Equity | 16,251.2 | 15,660.1 | +3.8% | | **Profitability Indicators (%)** | | | | | Return on Assets | 0.64% | 0.71% | -0.07pp | | Return on Equity | 7.52% | 7.77% | -0.25pp | | Cost-to-Income Ratio | 47.96% | 51.08% | -3.12pp | | **Asset Quality Indicators (%)** | | | | | Non-Performing Loan Ratio | 1.63% | 1.68% | -0.05pp | | Provision Coverage Ratio | 164.82% | 167.58% | -2.76pp | | **Capital Adequacy Indicators (%)** | | | | | Core Tier 1 Capital Adequacy Ratio | 9.05% | 9.55% | -0.50pp | | Tier 1 Capital Adequacy Ratio | 9.15% | 9.66% | -0.51pp | | Capital Adequacy Ratio | 11.37% | 11.98% | -0.61pp | [Chapter 4 Management Discussion and Analysis](index=31&type=section&id=%E7%AC%AC%E5%9B%9B%E7%AB%A0%20%E7%AE%A1%E7%90%86%E5%B1%82%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) [4.1 Environment and Outlook](index=31&type=section&id=4.1%20%E7%8E%AF%E5%A2%83%E4%B8%8E%E5%B1%95%E6%9C%9B) The 2021 outlook anticipates global economic recovery amidst uncertainties, with China's "14th Five-Year Plan" driving strong domestic growth, offering development opportunities for rural commercial banks, as the bank focuses on serving the real economy and integrated development - 2021 marks the beginning of China's "14th Five-Year Plan", with prudent monetary policy and proactive fiscal policy expected to drive strong economic recovery[55](index=55&type=chunk) - The bank will coordinate the "four-in-one" construction of "San Nong" finance, community finance, cooperation platforms, and public welfare and charity, integrating into the new "dual circulation" development pattern[55](index=55&type=chunk) [4.2 Development Strategy](index=32&type=section&id=4.2%20%E5%8F%91%E5%B1%95%E6%88%98%E7%95%A5) The Group's strategic vision is to become a leading modern, branded rural commercial bank by consolidating its "San Nong" and SME service advantages, developing retail banking, expanding new businesses, and strengthening risk management and talent development - The strategic goal is to build a first-class modern and branded rural commercial bank in China[56](index=56&type=chunk) - Specific measures include: - Consolidating advantages in "San Nong" and SME banking services - Developing retail banking business - Expanding new businesses - Strengthening risk management and internal control - Building a high-quality talent team[56](index=56&type=chunk) [4.3 Overall Business Review](index=32&type=section&id=4.3%20%E6%95%B4%E4%BD%93%E4%B8%9A%E5%8A%A1%E5%9B%9E%E9%A1%B5) In 2020, the Group achieved stable operations with total operating income growing **4.4%** to **RMB 5.55 billion** and net profit increasing **0.3%** to **RMB 1.2 billion**, alongside significant asset expansion and stable asset quality with an NPL ratio of **1.63%** 2020 Group Overall Performance Overview | Indicator | 2020 (RMB) | 2019 (RMB) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Operating Income | 5.547 billion RMB | 5.311 billion RMB | +4.4% | | Net Profit | 1.200 billion RMB | 1.196 billion RMB | +0.3% | | Total Assets | 200.363 billion RMB | 173.276 billion RMB | +15.6% | | Total Loans and Advances | 130.077 billion RMB | 96.104 billion RMB | +35.3% | | Total Deposits from Customers | 149.763 billion RMB | 122.840 billion RMB | +21.9% | | Non-Performing Loan Ratio | 1.63% | 1.68% | -0.05pp | [4.3.a Consolidated Income Statement Analysis](index=33&type=section&id=4.3.a%20%E5%90%88%E5%B9%B6%E6%8D%9F%E7%9B%8A%E8%A1%A8%E5%88%86%E6%9E%90) In 2020, the Group's net profit slightly increased by **0.3%**, driven by a **22.4%** rise in net interest income from expanded interest-earning assets, despite declines in fee income and trading gains, and a **1.6%** decrease in operating expenses Changes in Major Items of Consolidated Income Statement 2019-2020 | Item (RMB million) | 2020 | 2019 | Change (%) | | :--- | :--- | :--- | :--- | | Net Interest Income | 5,098.5 | 4,165.4 | +22.4% | | Net Fee and Commission Income | 230.6 | 316.5 | -27.1% | | Net Trading Gains | 149.8 | 609.8 | -75.4% | | Operating Income | 5,546.8 | 5,311.4 | +4.4% | | Operating Expenses | (2,743.7) | (2,787.4) | -1.6% | | Asset Impairment Losses | (1,306.6) | (1,088.1) | +20.1% | | Profit Before Tax | 1,541.1 | 1,503.5 | +2.5% | | Profit for the Year | 1,199.7 | 1,195.7 | +0.3% | - Net interest income, the largest component of operating income, increased its share from **78.4%** to **91.9%**, driven by a **22.3%** increase in average interest-earning assets[62](index=62&type=chunk)[73](index=73&type=chunk) - Net interest margin decreased from **2.74%** to **2.58%**, while net interest yield remained at **2.75%**, primarily due to lower average loan yields in response to national fee reduction policies and LPR decline[67](index=67&type=chunk)[85](index=85&type=chunk) [4.3.b Consolidated Statement of Financial Position Analysis](index=51&type=section&id=4.3.b%20%E5%90%88%E5%B9%B6%E8%B4%A2%E5%8A%A1%E7%8A%B6%E5%86%B5%E8%A1%A8%E5%88%86%E6%9E%90) As of year-end 2020, total assets grew **15.6%** to **RMB 200.36 billion**, with net loans and advances increasing to **63.2%** of assets, while deposits rose **21.9%** to **RMB 149.76 billion** as the primary funding source 2020 Year-End Consolidated Statement of Financial Position Structure | Item (RMB million) | December 31, 2020 | Share of Total (%) | December 31, 2019 | Share of Total (%) | | :--- | :--- | :--- | :--- | :--- | | **Assets** | | | | | | Net Loans and Advances | 126,574.6 | 63.2% | 93,394.2 | 53.9% | | Investment Securities and Other Financial Assets | 30,499.0 | 15.2% | 39,218.2 | 22.6% | | Cash and Balances with Central Bank | 25,155.0 | 12.6% | 23,626.4 | 13.6% | | **Total Assets** | **200,363.3** | **100.0%** | **173,275.5** | **100.0%** | | **Liabilities** | | | | | | Deposits from Customers | 149,763.2 | 81.3% | 122,840.4 | 77.9% | | Debt Instruments Issued | 7,504.5 | 4.1% | 14,220.1 | 9.0% | | **Total Liabilities** | **184,112.1** | **100.0%** | **157,615.4** | **100.0%** | - Total loans and advances increased by **35.3%** year-on-year, primarily due to increased credit extended to SMEs to support epidemic prevention and control and business resumption[105](index=105&type=chunk)[107](index=107&type=chunk) - Investment securities and other financial assets decreased by **22.2%** year-on-year, mainly due to the Group's reduction in investments in bonds, asset management, and trust plans based on regulatory policies and market conditions[116](index=116&type=chunk) [4.3.c Asset Quality Analysis](index=60&type=section&id=4.3.c%20%E8%B5%84%E4%BA%A7%E8%B4%A8%E9%87%8F%E5%88%86%E6%9E%90) As of year-end 2020, the Group's asset quality remained stable, with the NPL ratio slightly decreasing to **1.63%** from **1.68%** due to rapid loan growth, though retail NPLs increased, primarily impacted by the pandemic and economic downturn Loan Five-Category Classification and NPL Ratio 2019-2020 | Loan Classification | 2020 (RMB million) | Share of Total% | 2019 (RMB million) | Share of Total% | | :--- | :--- | :--- | :--- | :--- | | Normal | 123,911.7 | 95.3% | 92,902.1 | 96.8% | | Special Mention | 4,040.1 | 3.1% | 1,584.9 | 1.6% | | Substandard | 577.1 | 0.4% | 521.0 | 0.5% | | Doubtful | 1,463.5 | 1.1% | 1,067.1 | 1.1% | | Loss | 84.1 | 0.1% | 28.9 | 0.0% | | **Total Non-Performing Loans** | **2,124.7** | **1.63%** | **1,617.0** | **1.68%** | - Corporate loan NPL ratio decreased from **1.60%** to **1.35%**, while retail loan NPL ratio increased from **1.94%** to **2.86%**, mainly due to a decline in repayment ability of some retail customers affected by the epidemic[133](index=133&type=chunk)[134](index=134&type=chunk) - As of year-end 2020, the loan balance to the top ten single borrowers was **RMB 10.15 billion**, accounting for **7.80%** of total loans, all classified as normal[131](index=131&type=chunk) [4.4 Business Review](index=67&type=section&id=4.4%20%E4%B8%9A%E5%8A%A1%E5%AE%A1%E8%A7%86) The Group primarily operates three segments: corporate banking, retail banking, and treasury business, with corporate banking revenue growing strongly to **77.5%** of total in 2020, while retail banking saw steady growth and treasury business declined due to market volatility Operating Income by Business Segment 2019-2020 | Business Segment | 2020 (RMB million) | Share of Total% | 2019 (RMB million) | Share of Total% | | :--- | :--- | :--- | :--- | :--- | | Corporate Banking Business | 4,298.4 | 77.5% | 3,391.8 | 63.9% | | Retail Banking Business | 642.0 | 11.6% | 566.3 | 10.7% | | Treasury Business | 586.6 | 10.5% | 1,157.0 | 21.8% | | Other | 19.8 | 0.4% | 196.3 | 3.6% | | **Total** | **5,546.8** | **100.0%** | **5,311.4** | **100.0%** | [4.4.a Corporate Banking Business](index=67&type=section&id=4.4.a%20%E5%85%AC%E5%8F%B8%E9%93%B6%E8%A1%8C%E4%B8%9A%E5%8A%A1) In 2020, corporate banking operating income grew **26.7%** to **RMB 4.3 billion**, driven by strong net interest income, with corporate loans increasing **44.2%** to **RMB 105.63 billion**, primarily supporting SMEs - Total corporate loans increased by **44.2%** to **RMB 105.63 billion**, with **2,378** SME loan customers and a total loan amount of **RMB 83.80 billion**[144](index=144&type=chunk)[147](index=147&type=chunk) [4.4.b Retail Banking Business](index=70&type=section&id=4.4.b%20%E9%9B%B6%E5%94%AE%E9%93%B6%E8%A1%8C%E4%B8%9A%E5%8A%A1) In 2020, retail banking operating income increased **13.4%** to **RMB 640 million**, with retail loans growing **7.1%** to **RMB 24.45 billion** and retail deposits rising **29.5%** to **RMB 105.56 billion**, while bank card business continued to develop - Retail loans increased by **7.1%** to **RMB 24.45 billion**, accounting for **18.8%** of total loans[157](index=157&type=chunk) - Retail deposits increased by **29.5%** to **RMB 105.56 billion**, accounting for **70.5%** of total deposits[158](index=158&type=chunk) [4.4.c Treasury Business](index=73&type=section&id=4.4.c%20%E8%B5%84%E9%87%91%E4%B8%9A%E5%8A%A1) In 2020, treasury business operating income decreased **49.3%** to **RMB 590 million**, mainly due to reduced trading and investment gains, leading to a **22.2%** decline in investment securities and other financial assets - Treasury business operating income decreased by **49.3%**, primarily due to reduced trading gains and investment income[166](index=166&type=chunk) - Total investment securities and other financial assets decreased from **RMB 39.22 billion** to **RMB 30.50 billion**, a **22.2%** decrease[173](index=173&type=chunk) [4.5 Risk Management](index=85&type=section&id=4.5%20%E9%A3%8E%E9%99%A9%E7%AE%A1%E7%90%86) The Group is committed to a comprehensive risk management system, with the Board as the ultimate decision-maker, managing credit, market, operational, and liquidity risks, and enhanced risk resilience through COVID-19 support measures and improved processes - The bank established a hierarchical comprehensive risk management system, with the Board as the highest decision-making body, managing eight major types of risks[196](index=196&type=chunk) - Credit risk management involves client access, credit exit, risk early warning, and non-performing asset disposal mechanisms, with a focus in 2020 on supporting epidemic prevention and control and business resumption[197](index=197&type=chunk)[198](index=198&type=chunk) - Liquidity risk management adheres to safe and prudent principles, ensuring overall liquidity stability through optimizing asset-liability structure, strengthening monitoring and early warning, and implementing stress tests[212](index=212&type=chunk)[213](index=213&type=chunk) - Legal and compliance risk management involves a three-year "compliance offensive" aimed at building a compliance and case prevention system covering all businesses and personnel[220](index=220&type=chunk) [4.6 Capital Adequacy Ratio Analysis](index=105&type=section&id=4.6%20%E8%B5%84%E6%9C%AC%E5%85%85%E8%B6%B3%E7%8E%87%E5%88%86%E6%9E%90) As of year-end 2020, all capital adequacy ratios met CBIRC regulatory requirements, with core Tier 1 at **9.05%**, Tier 1 at **9.15%**, and total capital adequacy at **11.37%**, though all declined from 2019 due to rapid growth in risk-weighted assets Capital Adequacy Ratios 2019-2020 | Capital Adequacy Ratio Indicator | December 31, 2020 | December 31, 2019 | Regulatory Requirement (2020) | | :--- | :--- | :--- | :--- | | Core Tier 1 Capital Adequacy Ratio | 9.05% | 9.55% | ≥7.5% | | Tier 1 Capital Adequacy Ratio | 9.15% | 9.66% | ≥8.5% | | Capital Adequacy Ratio | 11.37% | 11.98% | ≥10.5% | - The primary reason for the decline in capital adequacy ratios is the increase in total risk-weighted assets from **RMB 141.84 billion** to **RMB 161.21 billion**[235](index=235&type=chunk) [Chapter 5 Board of Directors' Report](index=107&type=section&id=%E7%AC%AC%E4%BA%94%E7%AB%A0%20%E8%91%A3%E4%BA%8B%E4%BC%9A%E6%8A%A5%E5%91%8A) [V. Profit and Dividends](index=109&type=section&id=%E4%BA%94%E3%80%81%E5%88%A9%E6%B6%A6%E4%B8%8E%E8%82%A1%E6%81%AF) The Board recommends a final dividend of **RMB 0.15** per share (tax inclusive) for 2020, totaling an estimated **RMB 659 million**, representing **54.9%** of annual profit, subject to shareholder approval 2020 Final Dividend Proposal | Item | Amount/Ratio | | :--- | :--- | | Cash Dividend Per Share | RMB 0.15 (tax inclusive) | | Total Dividend (Estimated) | RMB 659 million (tax inclusive) | | Cash Dividend as % of Annual Profit | 54.9% | [VI. Capital Reserve to Share Capital Conversion Plan](index=110&type=section&id=%E5%85%AD%E3%80%81%E8%B5%84%E6%9C%AC%E5%85%AC%E7%A7%AF%E8%BD%AC%E5%A2%9E%E8%82%A1%E6%9C%AC%E6%96%B9%E6%A1%88) The Board proposes a capital reserve to share capital conversion plan of **5 shares for every 100 shares** held, pending approval from shareholders and regulators - The proposed capitalization issue plan is **5 shares for every 100 shares**[245](index=245&type=chunk) [XLIII. Acquisitions and Disposals of Subsidiaries, Associates, Assets and Businesses / Corporate Mergers](index=125&type=section&id=%E5%9B%9B%E5%8D%81%E4%B8%89%E3%80%81%E6%94%B6%E8%B4%AD%E5%8F%8A%E5%87%BA%E5%94%AE%E9%99%84%E5%B1%9E%E5%85%AC%E5%8F%B8%E3%80%81%E8%81%94%E8%90%A5%E5%85%AC%E5%8F%B8%E8%B5%84%E4%BA%A7%E5%8F%8A%E4%B8%9A%E5%8A%A1%EF%BC%8F%E4%BC%81%E4%B8%9A%E5%90%88%E5%B9%B6%E6%83%85%E5%86%B5) During the reporting period, the Bank had no significant acquisitions or disposals, but optimized its investment portfolio by selling shares in several rural commercial banks, none of which were discloseable transactions under HKEX Listing Rules - After selling part of its shares in Liaoyuan Rural Commercial Bank, the shareholding ratio decreased to **56.09%**[291](index=291&type=chunk) - After selling part of its shares in Jilin Chuncheng Rural Commercial Bank, the shareholding ratio decreased to **15.23%**[292](index=292&type=chunk) - After selling part of its shares in Jilin Gongzhuling Rural Commercial Bank, the shareholding ratio decreased to **20.20%**[293](index=293&type=chunk) - All shares in Jilin Huancheng Rural Commercial Bank were fully sold, and the bank no longer holds any shares[294](index=294&type=chunk) [Chapter 6 Supervisory Board Report](index=129&type=section&id=%E7%AC%AC%E5%85%AD%E7%AB%A0%20%E7%9B%91%E4%BA%8B%E4%BC%9A%E6%8A%A5%E5%91%8A) [II. Independent Opinions of the Supervisory Board on Relevant Matters](index=132&type=section&id=%E4%BA%8C%E3%80%81%E7%9B%91%E4%BA%8B%E4%BC%9A%E5%B0%B1%E6%9C%89%E5%85%B3%E4%BA%8B%E9%A1%B9%E5%8F%91%E8%A1%A8%E7%9A%84%E7%8B%AC%E7%AB%8B%E6%84%8F%E8%A7%81) The Supervisory Board provided independent opinions on the Bank's 2020 performance, affirming the Board and senior management's diligent performance, legal compliance, fair financial reporting, effective internal controls, and no harm to shareholder interests from asset sales - The Board of Directors and senior management diligently performed their duties, and business decision-making procedures were legal and effective[305](index=305&type=chunk) - The financial report truly and fairly reflects the bank's financial position and operating results[306](index=306&type=chunk) - The internal control system is complete and reasonable, with no major defects found[306](index=306&type=chunk) [Chapter 7 Changes in Share Capital and Shareholder Details](index=135&type=section&id=%E7%AC%AC%E4%B8%83%E7%AB%A0%20%E8%82%A1%E6%9C%AC%E5%8F%98%E5%8A%A8%E5%8F%8A%E8%82%A1%E4%B8%9C%E8%AF%A6%E6%83%85) [II. Shareholder Details](index=136&type=section&id=II.%20%E8%82%A1%E4%B8%9C%E8%AF%A6%E6%83%85) As of year-end 2020, the Bank's shareholding structure was dispersed with no controlling shareholder, and Jilin Province Trust Co., Ltd. was the largest shareholder with **9.61%** ownership - The bank's shareholding structure is dispersed, with no controlling shareholder or actual controller[318](index=318&type=chunk) Top Three Domestic Shareholders as of December 31, 2020 | Rank | Shareholder Name | Number of Shares Held | Share of Total Share Capital (%) | | :--- | :--- | :--- | :--- | | 1 | Jilin Province Trust Co., Ltd. | 422,180,233 | 9.61% | | 2 | Changchun Huaxing Construction Co., Ltd. | 361,682,093 | 8.23% | | 3 | Changchun Huamei Tourism Culture Media Co., Ltd. | 200,502,603 | 4.56% | [Chapter 8 Directors, Supervisors, Senior Management, Employees and Organization](index=141&type=section&id=%E7%AC%AC%E5%85%AB%E7%AB%A0%20%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E3%80%81%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E5%B1%82%E3%80%81%E9%9B%87%E5%91%98%E5%8F%8A%E7%BB%84%E7%BB%87) [II. Changes in Directors, Supervisors and Senior Management](index=145&type=section&id=II.%20%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E5%8F%8A%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E5%8F%98%E5%8A%A8) There were no changes in directors or supervisors during the reporting period, but Ms. Song Xiaoping retired as Vice President, and Mr. Liang Xiangmin resigned as President post-period, with a new President appointed pending regulatory approval - Ms. Song Xiaoping retired and ceased to serve as Vice President effective **March 30, 2020**[326](index=326&type=chunk) - Mr. Liang Xiangmin resigned as President on **April 16, 2021**, and the Board has resolved to appoint Mr. Chen Xinzhe as his successor, effective upon regulatory approval[326](index=326&type=chunk) [VIII. Employees, Employee Remuneration Policy and Employee Training Programs](index=160&type=section&id=VIII.%E9%9B%87%E5%91%98%E3%80%81%E9%9B%87%E5%91%98%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96%E5%8F%8A%E9%9B%87%E5%91%98%E5%9F%B9%E8%AE%AD%E8%AE%A1%E5%88%92) As of year-end 2020, the Group had **6,419** full-time employees, with retail banking staff comprising **48%**, and implemented a performance-based remuneration system and extensive online and offline training programs totaling **6,445** participants - As of year-end 2020, the Group had **6,419** employees, with over **59%** holding a bachelor's degree or higher[352](index=352&type=chunk)[353](index=353&type=chunk) - In 2020, the Group conducted **6,445** employee training sessions through online and offline methods, and organized an online comprehensive business knowledge competition[495](index=495&type=chunk)[496](index=496&type=chunk) [Chapter 9 Corporate Governance Report](index=166&type=section&id=%E7%AC%AC%E4%B9%9D%E7%AB%A0%20%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86%E6%8A%A5%E5%91%8A) [II. Corporate Governance Overview](index=166&type=section&id=II.%20%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86%E6%A6%82%E8%A7%88) The Bank maintains high corporate governance standards with a modern structure including the Shareholders' Meeting, Board, Supervisory Board, and committees, fully complying with the HK Corporate Governance Code and implementing a board diversity policy - The bank has established a modern corporate governance structure, including the Shareholders' Meeting, Board of Directors, Supervisory Board, and eight committees under the Board[363](index=363&type=chunk) - During the reporting period, the bank fully complied with all code provisions of the Hong Kong Corporate Governance Code[363](index=363&type=chunk) [IV. Board of Directors](index=170&type=section&id=IV.%20%E8%91%A3%E4%BA%8B%E4%BC%9A) The Board, comprising **13** members including independent non-executive directors, is central to the Bank's governance, held **5** meetings to review major matters, and operates through eight specialized committees to enhance efficiency and professionalism - The Board of Directors consists of **13** members, with independent non-executive directors accounting for over one-third, meeting regulatory requirements[372](index=372&type=chunk)[373](index=373&type=chunk) - The Board has eight committees: Strategic Development, Audit, Connected Transactions Control, Risk Management, Nomination, Remuneration, Consumer Rights Protection, and "San Nong" Financial Services Committees[389](index=389&type=chunk) [V. Supervisory Board](index=190&type=section&id=V.%20%E7%9B%91%E4%BA%8B%E4%BC%9A) The Supervisory Board, consisting of **7** members including employee supervisors, oversees the performance of directors and senior management, financial activities, and internal controls, holding **5** meetings and operating through two committees to fulfill its oversight duties effectively - The Supervisory Board consists of **7** supervisors, with employee supervisors accounting for over one-third, in compliance with regulations[405](index=405&type=chunk) - The Supervisory Board has established a Nomination Committee and a Supervision Committee to enhance the professionalism of its oversight work[413](index=413&type=chunk) [Chapter 10 Risk Management, Internal Control and Internal Audit](index=208&type=section&id=%E7%AC%AC%E5%8D%81%E7%AB%A0%20%E9%A3%8E%E9%99%A9%E7%AE%A1%E7%90%86%E3%80%81%E5%86%85%E9%83%A8%E6%8E%A7%E5%88%B6%E5%8F%8A%E5%86%85%E9%83%A8%E5%AE%A1%E8%AE%A1) [Risk Management Organizational Structure and System](index=208&type=section&id=%E9%A3%8E%E9%99%A9%E7%AE%A1%E7%90%86%E7%BB%84%E7%BB%87%E6%9E%B6%E6%9E%84%E4%B8%8E%E5%88%B6%E5%BA%A6) The Group has established a comprehensive risk management system covering front, middle, and back offices, with the Board bearing ultimate responsibility, and an effective credit management system in place for systematic management of various risks, with no major defects found in internal controls - The bank established a comprehensive risk management organizational structure comprising the Board of Directors, Supervisory Board, senior management, and relevant departments[439](index=439&type=chunk)[440](index=440&type=chunk)[445](index=445&type=chunk)[446](index=446&type=chunk) - The credit management system implements separation of loan approval and review, and strengthens unified credit granting, business processes, loan classification, and employee risk awareness management for group clients[455](index=455&type=chunk) [Chapter 11 Environmental, Social and Governance Report](index=218&type=section&id=%E7%AC%AC%E5%8D%81%E4%B8%80%E7%AB%A0%20%E7%8E%AF%E5%A2%83%E3%80%81%E7%A4%BE%E4%BC%9A%E5%8F%8A%E7%AE%A1%E6%B2%BB%E6%8A%A5%E5%91%8A) [3. Appropriate Business Environment](index=224&type=section&id=3.%20%E5%90%88%E9%80%82%E8%90%A5%E5%95%86%E7%8E%AF%E5%A2%83) The Group fosters a compliant and stable business environment through robust anti-corruption and anti-money laundering measures, comprehensive risk management, customer rights protection, and information security, while also ensuring sound supply chain procurement management - The bank established a three-line-of-defense anti-money laundering management system to effectively prevent and combat money laundering risks[481](index=481&type=chunk) - The "Consumer Rights Protection Management Measures" were formulated and implemented to safeguard customer rights, with **17** complaints received and a **100%** resolution rate in 2020[485](index=485&type=chunk)[488](index=488&type=chunk) [5. Green and Low-Carbon Management](index=235&type=section&id=5.%20%E7%BB%BF%E8%89%B2%E4%BD%8E%E7%A2%B3%E7%AE%A1%E7%90%86) The Group actively practices green operations and green finance, reducing greenhouse gas emissions by approximately **16%** in 2020 through resource conservation and waste management, while directing credit towards green industries and restricting high-pollution sectors Greenhouse Gas Emissions Performance 2019-2020 | Greenhouse Gas Emissions Performance | Unit | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Total Greenhouse Gas Emissions | tons CO2e | 10,838.46 | 13,005.28 | | Emissions Intensity per Square Meter | tons CO2e/sqm | 0.027 | 0.037 | | Emissions Intensity per Employee | tons CO2e/employee | 1.69 | 2.09 | - The Group actively develops green finance, guiding credit funds towards green manufacturing, eco-tourism, and energy-saving and environmental protection industries, and establishing a green finance priority approval mechanism[513](index=513&type=chunk)[514](index=514&type=chunk) [6. Fulfillment of Social Responsibilities](index=242&type=section&id=6.%20%E5%B1%A5%E8%A1%8C%E7%A4%BE%E4%BC%9A%E8%B4%A3%E4%BB%BB) The Group actively fulfills social responsibilities by supporting COVID-19 response with over **RMB 9.5 million** in donations, promoting inclusive finance for "San Nong" and the real economy, and implementing targeted poverty alleviation programs through various models - Assisted in epidemic prevention and control: cumulative donations of over **RMB 9.5 million** for the year, and provided credit support to SMEs affected by the epidemic[516](index=516&type=chunk) - Assisted in targeted poverty alleviation: helped poor villages increase collective income by over **RMB 3.4 million** through industrial poverty alleviation, and prevented intergenerational poverty through educational programs like "Financial Poverty Alleviation Motivation Class"[518](index=518&type=chunk)[519](index=519&type=chunk) [Independent Auditor's Report and Consolidated Financial Statements](index=255&type=section&id=%E7%8B%AC%E7%AB%8B%E6%A0%B8%E6%95%B0%E5%B8%88%E6%8A%A5%E5%91%8A%E5%8F%8A%E5%90%88%E5%B9%B6%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) [Independent Auditor's Report](index=255&type=section&id=%E7%8B%AC%E7%AB%8B%E6%A0%B8%E6%95%B0%E5%B8%88%E6%8A%A5%E5%91%8A) The auditor, Shinewing (HK) CPA Limited, issued an unmodified opinion on the Group's 2020 consolidated financial statements, affirming their fair presentation in accordance with IFRS and HK Companies Ordinance, with key audit matters including consolidation basis, loan impairment, goodwill impairment, and IT outsourcing - The auditor issued a standard unmodified audit opinion on the Group's 2020 consolidated financial statements[538](index=538&type=chunk) - Key audit matters include: - **Basis of Consolidation**: Reviewing management's assessment of control over non-material subsidiaries, particularly the effectiveness of concerted action agreements - **Impairment of Loans and Advances**: Reviewing the assessment, methodology, and assumptions of the Expected Credit Loss (ECL) model - **Goodwill Impairment**: Challenging the valuation model, key assumptions (e.g., growth rates, discount rates), and input data used in impairment assessments - **IT System Outsourcing Arrangements**: Assessing the Group's controls over IT outsourcing arrangements and monitoring procedures for service providers[540](index=540&type=chunk) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=264&type=section&id=%E5%90%88%E5%B9%B6%E6%8D%9F%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E7%BB%BC%E5%90%88%E6%94%B6%E7%9B%8A%E8%A1%A8) For the year ended December 31, 2020, the Group achieved net interest income of **RMB 5.1 billion**, a **22.4%** increase, total operating income of **RMB 5.55 billion**, a **4.4%** increase, and a net profit of **RMB 1.2 billion**, a **0.3%** increase, with basic EPS of **RMB 0.25** 2020 Consolidated Income Statement Summary | Item (RMB thousand) | 2020 | 2019 | | :--- | :--- | :--- | | Net Interest Income | 5,098,430 | 4,165,427 | | Operating Income | 5,546,764 | 5,311,438 | | Profit Before Tax | 1,541,015 | 1,503,474 | | Profit for the Year | 1,199,663 | 1,195,695 | | Profit Attributable to Owners of the Bank | 1,104,416 | 1,042,146 | | Basic and Diluted Earnings Per Share (RMB) | 0.25 | 0.24 (restated) | [Consolidated Statement of Financial Position](index=266&type=section&id=%E5%90%88%E5%B9%B6%E8%B4%A2%E5%8A%A1%E7%8A%B6%E5%86%B5%E8%A1%A8) As of December 31, 2020, the Group's total assets were **RMB 200.36 billion**, with net loans and advances at **RMB 126.57 billion**, and total liabilities were **RMB 184.11 billion**, primarily from **RMB 149.76 billion** in deposits, with total equity at **RMB 16.25 billion** 2020 Year-End Consolidated Statement of Financial Position Summary | Item (RMB thousand) | December 31, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Assets** | | | | Loans and Advances | 126,574,552 | 93,394,198 | | Investment Securities and Other Financial Assets | 30,499,002 | 39,218,160 | | **Total Assets** | **200,363,270** | **173,275,544** | | **Liabilities** | | | | Deposits from Customers | 149,763,189 | 122,840,400 | | **Total Liabilities** | **184,112,085** | **157,615,368** | | **Equity** | | | | Total Equity Attributable to Owners of the Bank | 13,671,531 | 13,339,953 | | **Total Equity** | **16,251,185** | **15,660,176** | [Consolidated Statement of Cash Flows](index=270&type=section&id=%E5%90%88%E5%B9%B6%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) For the year ended December 31, 2020, the Group generated **RMB 8.0 billion** net cash from operating activities, **RMB 4.39 billion** net cash from investing activities, used **RMB 7.95 billion** in financing activities, resulting in a net increase of **RMB 4.44 billion** in cash and cash equivalents 2020 Consolidated Statement of Cash Flows Summary | Item (RMB thousand) | 2020 | 2019 | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 8,004,976 | 7,236,044 | | Net Cash Generated from Investing Activities | 4,388,371 | 1,450,464 | | Net Cash Used in Financing Activities | (7,951,600) | (7,962,418) | | **Net Increase in Cash and Cash Equivalents** | **4,441,747** | **724,090** | | Cash and Cash Equivalents at Beginning of Year | 16,820,070 | 16,095,980 | | **Cash and Cash Equivalents at End of Year** | **21,261,817** | **16,820,070** |

Financial Performance - The company reported a significant increase in total assets, reaching RMB 100 billion, representing a growth of 15% year-over-year[3]. - The company is targeting a net profit growth of 10% for the full year 2019, supported by increased lending and improved interest margins[3]. - Net interest income for the first half of 2019 was RMB 1,913.9 million, an increase of 9.1% compared to RMB 1,753.6 million in the same period of 2018[18]. - The bank's net profit attributable to owners for the first half of 2019 was RMB 454.7 million, representing a 22.8% increase from RMB 370.2 million in the first half of 2018[18]. - Net profit rose by 5.2% to RMB 499.4 million, up from RMB 474.5 million in the first half of 2018[25]. - The total operating income for the first half of 2019 was RMB 2,427.0 million, a 2.1% increase from RMB 2,376.9 million in the same period of 2018[25]. - The bank's total equity as of June 30, 2019, was RMB 14,897.0 million, a decrease of 1.4% from RMB 15,107.5 million at the end of 2018[19]. - The bank's total liabilities were RMB 148,638.8 million, down 0.3% from RMB 149,145.7 million at the end of 2018[19]. Asset Quality - Non-performing loan ratio improved to 1.5%, down from 2.0% in the previous year, indicating better asset quality management[7]. - Non-performing loan ratio remained stable at 1.85%[25]. - The non-performing loan (NPL) ratio increased to 1.85% as of June 30, 2019, compared to 1.75% as of December 31, 2018, primarily due to macroeconomic conditions and structural adjustments[88]. - The total amount of non-performing loans was RMB 1,611.3 million as of June 30, 2019, up from RMB 1,354.8 million at the end of 2018[95]. - The highest non-performing loan rates were in the accommodation and catering industry (3.79%), real estate (3.57%), and residents and other services (3.55%) as of June 30, 2019[91]. Customer Deposits and Loans - Customer deposits grew by 20% to RMB 80 billion, reflecting strong customer confidence and market expansion efforts[3]. - Customer loans and advances increased by 12.4% to RMB 84,694.7 million from RMB 75,354.5 million at the end of 2018[19]. - Total customer loans and advances reached RMB 87,296.8 million as of June 30, 2019, representing a 12.6% increase from RMB 77,527.7 million as of December 31, 2018[71]. - Retail loans grew by 5.6% from RMB 20,668.6 million as of December 31, 2018, to RMB 21,827.5 million as of June 30, 2019[73]. - The total amount of loans to small and micro enterprises reached RMB 65,469.3 million as of June 30, 2019, with 2,676 corporate loan customers[107]. Capital Adequacy - The bank's capital adequacy ratio stands at 12.5%, above the regulatory requirement, ensuring financial stability and growth potential[7]. - The capital adequacy ratio was maintained at a healthy level, with a capital return rate of 6.66%, up from 6.17% in the previous year[20]. - The core Tier 1 capital adequacy ratio was 8.85%, down from 9.40%[21]. - Tier 1 capital adequacy ratio was 8.94%, down from 9.50%[21]. - The bank's capital adequacy ratio was 11.25% as of June 30, 2019, down from 11.83% as of December 31, 2018[184]. Risk Management - The management emphasized a commitment to sustainable growth and risk management practices in the upcoming fiscal year[3]. - The bank's credit risk management includes a customer admission mechanism and a credit exit mechanism to regularly reassess credit ratings[158]. - The bank has enhanced its market risk management capabilities, focusing on early warning and effective measures to prevent market risks, with a particular emphasis on monitoring market dynamics[160]. - The bank's operational risk management framework includes daily monitoring, identification, assessment, and control of operational risks, with a focus on training and compliance[164]. - The bank established a compliance risk management framework to ensure legal and regulatory adherence, revising over 40 internal regulations in 2019[169]. Digital Banking and Innovation - The bank plans to launch a new digital banking platform by Q4 2019, aiming to enhance customer experience and operational efficiency[3]. - Research and development investments increased by 25% to enhance technology capabilities and product offerings[3]. - The bank successfully launched a new credit card product, "Fenbei Card," enhancing online card usage experience through the "Jiutai Rural Commercial Bank Credit Card" WeChat public account and "Jiushang Credit Card" mobile app[123]. Operating Expenses - Operating expenses decreased by 10.2% from RMB 1,288 million to RMB 1,156 million, driven by reductions in employee costs and general administrative expenses[58]. - Employee costs decreased by 8.6% from RMB 731 million to RMB 668 million, attributed to a reduction in the number of consolidated rural commercial banks[61]. - Income tax expense rose by 16.6% from RMB 946 million to RMB 1,103 million, driven by an increase in pre-tax profits and effective tax rate[67]. Shareholder Information - The total number of shares issued by the company is 4,184,037,577, with 81.0% being domestic shares and 19.0% being H shares[187]. - The top ten domestic shareholders hold a total of 1,638,733,544 shares, representing approximately 41.12% of the issued share capital[189]. - The largest domestic shareholder is Jilin Trust Co., Ltd. with 382,929,916 shares, accounting for 9.61% of the total issued shares[190]. - The company has a significant number of pledged or frozen shares, totaling 210,000,000 shares[189]. - The company's ownership structure is dispersed, with no controlling shareholder or actual controller identified[198].