JIUTAI RCB(06122)

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九台农商银行(06122) - 2023 - 中期财报
2023-09-26 12:05
Financial Performance - Jilin Jiutai Rural Commercial Bank reported a significant increase in net profit for the first half of 2023, reaching RMB 1.2 billion, representing a 15% year-on-year growth[3]. - Future guidance indicates a target net profit growth of 10-12% for the full year 2023[3]. - The bank's pre-tax profit for the first half of 2023 was RMB 95.8 million, down 87.6% from RMB 774.9 million in the same period last year[21]. - Basic earnings per share decreased by 78.6% to RMB 0.03 from RMB 0.14 year-on-year[21]. - Net profit for the first half of 2023 was RMB 128.1 million, down 80.4% from RMB 653.6 million in the first half of 2022[32]. - The total operating income for the first half of 2023 was RMB 2,517.5 million, a decrease of 20.1% compared to RMB 3,151.8 million in the same period of 2022[29]. Asset and Liability Management - The bank's total assets grew to RMB 100 billion, an increase of 10% compared to the previous year[3]. - Total assets as of June 30, 2023, were RMB 267,276.7 million, reflecting a slight increase of 0.1% from RMB 267,000.7 million at the end of 2022[22]. - Total liabilities stood at RMB 248,488.0 million, showing no significant change from RMB 248,381.4 million at the end of 2022[22]. - The capital adequacy ratio stands at 12.5%, above the regulatory requirement, ensuring financial stability for future growth[3]. - The capital adequacy ratio was 10.98% as of June 30, 2023, down from 11.50% at the end of 2022[23]. Loan and Deposit Growth - Customer deposits increased by 12% to RMB 80 billion, reflecting strong customer confidence and market position[3]. - The total amount of loans and advances issued reached RMB 179,208.3 million as of June 30, 2023, representing a growth of 4.2% compared to December 31, 2022[86]. - Retail loans grew from RMB 26,984.8 million as of December 31, 2022, to RMB 27,514.0 million as of June 30, 2023, marking a 2.0% increase[88]. - Retail deposits totaled RMB 190,375.6 million as of June 30, 2023, an increase from RMB 173,073.1 million as of December 31, 2022, representing 81.7% and 76.1% of total deposits, respectively[147]. Non-Performing Loans and Asset Quality - The bank's non-performing loan ratio improved to 1.5%, down from 1.8% in the previous year, indicating better asset quality management[3]. - The non-performing loan ratio increased to 2.28% as of June 30, 2023, compared to 1.98% at the end of 2022, indicating a deterioration in asset quality[23]. - Non-performing loans (NPLs) reached RMB 4,080.9 million as of June 30, 2023, resulting in an NPL ratio of 2.28%, up from 1.98% as of December 31, 2022[107][108]. Digital Transformation and Innovation - The bank is investing in digital banking technologies, with a budget of RMB 200 million allocated for the development of new mobile banking features[3]. - The group has launched a digital banking initiative, including the introduction of a television bank and the establishment of unmanned banking locations[169]. - The company has received 6 software copyrights from the National Copyright Administration and a total of 33 software copyrights as of June 30, 2023, indicating a strong focus on intellectual property protection[181]. Risk Management - The company has established a comprehensive risk management system, focusing on credit risk, market risk, operational risk, liquidity risk, and compliance risk to achieve strategic and operational goals[185]. - In the first half of 2023, the bank implemented strict market risk limit management, continuously monitoring trading limits, stop-loss limits, and risk limits to provide early warnings for potential risks[192]. - The bank's operational risk management is overseen by the board of directors, with a focus on identifying, assessing, and controlling operational risks through various departments[198]. Branch Expansion and Market Presence - Jilin Jiutai plans to expand its branch network by 20% over the next year to enhance customer accessibility and service[3]. - The bank is exploring potential mergers and acquisitions to strengthen its market presence in the region[3]. Awards and Recognition - The bank received multiple awards in the first half of 2023, including recognition for its exemplary case in rural revitalization services[19]. Customer Service and Communication - The bank's customer service hotline is +86 (431) 96888, and its official website is www.jtnsh.com[15]. - The group had a total of 3,081,845 customers using telephone and SMS banking services as of June 30, 2023[171].
九台农商银行(06122) - 2023 - 中期业绩
2023-08-30 23:00
Financial Performance - For the six months ended June 30, 2023, the bank reported net interest income of RMB 2,417.1 million, a decrease of 18.0% compared to RMB 2,947.6 million for the same period in 2022[5]. - The net profit attributable to the bank's owners for the first half of 2023 was RMB 149.3 million, down 79.6% from RMB 732.1 million in the same period last year[5]. - The bank's operating profit for the first half of 2023 was RMB 93.4 million, a significant decline of 88.0% from RMB 781.3 million in the same period of 2022[5]. - The total operating income for the six months ended June 30, 2023, was RMB 2,517.5 million, a decrease of 20.1% compared to RMB 3,151.8 million for the same period in 2022[12]. - Net profit for the same period dropped 80.4% to RMB 128.1 million from RMB 653.6 million in the previous year[12]. - The pre-tax profit for the first half of 2023 was RMB 95.8 million, down 87.6% from the previous year[14]. - The diluted earnings per share for the first half of 2023 were RMB 0.03, down 78.6% from RMB 0.14 in the same period of 2022[4]. Asset and Liability Management - The bank's total assets as of June 30, 2023, were RMB 267,276.7 million, reflecting a slight increase of 0.1% from RMB 267,000.7 million at the end of 2022[7]. - The bank's total liabilities were RMB 248,488.0 million as of June 30, 2023, showing no change from RMB 248,381.4 million at the end of 2022[7]. - The total amount of loans and advances issued increased by 4.2% from RMB 172,029.4 million as of December 31, 2022, to RMB 179,208.3 million as of June 30, 2023[58]. - The net amount of loans and advances increased by 2.7% to RMB 175,234.7 million compared to the beginning of the year[12]. - Total deposits increased by 2.5% to RMB 233,138.5 million since the beginning of the year[12]. Non-Performing Loans and Risk Management - The bank's non-performing loan ratio increased to 2.28% as of June 30, 2023, compared to 1.98% at the end of 2022, representing a rise of 15.2%[8]. - The non-performing loans (NPLs) amounted to RMB 4,080.9 million, resulting in an NPL ratio of 2.28%, up from 1.98% as of December 31, 2022[75][76]. - The company noted that the rise in NPLs was primarily due to macroeconomic downturns and difficulties faced by some corporate clients in cash flow and debt repayment capabilities[76]. - The impairment loss provision for loans and advances rose by 14.4% from RMB 5,359.5 million as of December 31, 2022, to RMB 6,128.9 million as of June 30, 2023[64]. Income and Expense Analysis - The bank's net fee and commission income decreased by 74.7% to RMB 7.7 million for the first half of 2023, compared to RMB 30.4 million in the same period last year[5]. - Non-interest income for the six months ended June 30, 2023, was RMB 39.4 million, a decrease of 37.6% from RMB 63.1 million in 2022, with significant declines in various fee income categories[39]. - Operating expenses increased by 4.4% from RMB 1,322.1 million for the six months ended June 30, 2022, to RMB 1,380.2 million for the six months ended June 30, 2023, primarily due to increases in employee costs and general administrative expenses[47]. - Employee costs increased by 8.8% from RMB 847.1 million for the six months ended June 30, 2022, to RMB 921.6 million for the six months ended June 30, 2023, mainly due to increases in salaries and social insurance[49]. Capital Adequacy and Equity - The bank's capital adequacy ratio stood at 10.98% as of June 30, 2023, down from 11.50% at the end of 2022[8]. - As of June 30, 2023, total equity reached RMB 18,788.7 million, an increase from RMB 18,619.3 million as of December 31, 2022[73]. - The core tier 1 capital adequacy ratio as of June 30, 2023, is 8.51%, down from 8.91% as of December 31, 2022[167]. - The total capital adequacy ratio as of June 30, 2023, is 10.98%, compared to 11.50% as of December 31, 2022[167]. Strategic Initiatives and Future Outlook - The company aims to strengthen its position in the agricultural and small to medium enterprise banking sectors while expanding retail banking services[11]. - The bank's strategy focuses on community financial construction and digital transformation to enhance customer acquisition capabilities[71]. - The company is committed to enhancing consumer rights protection and has strengthened its product and service management to raise public awareness of financial knowledge[149]. - The company is focused on maintaining its capital adequacy to support future business development and meet regulatory requirements[175]. Governance and Compliance - The bank has maintained a high standard of corporate governance, adhering to best practices to protect shareholder interests and enhance corporate value[169]. - The bank has fully complied with all applicable provisions of the Corporate Governance Code during the reporting period[170]. - The internal audit department operates independently, focusing on risk management, compliance, and governance effectiveness to promote the company's stable development[159].
九台农商银行(06122) - 2022 - 年度财报
2023-04-26 13:00
Financial Performance - Jilin Jiutai Rural Commercial Bank reported a significant increase in net profit for 2022, reaching RMB 1.2 billion, representing a growth of 15% year-over-year[1]. - The bank's total assets grew to RMB 100 billion, an increase of 10% compared to the previous year[2]. - Customer deposits increased by 12% to RMB 80 billion, reflecting strong customer confidence and market position[3]. - In 2022, the net interest income was CNY 6,514.9 million, an increase from CNY 6,176.4 million in 2021, representing a growth of 5.5%[24]. - The annual profit attributable to shareholders was CNY 1,683.3 million in 2022, compared to CNY 1,129.4 million in 2021, reflecting a significant increase of 49.0%[24]. - The basic earnings per share rose to CNY 0.33 in 2022, up from CNY 0.22 in 2021, marking a growth of 50.0%[25]. - The total operating income for the year ended December 31, 2022, was RMB 6,597.1 million, an increase from RMB 6,362.3 million in 2021[102]. - The pre-tax profit for 2022 was RMB 1,982.7 million, a significant increase of 136.1% compared to RMB 839.7 million in 2021[109]. Asset and Liability Management - The bank's total liabilities amounted to CNY 248,381.4 million in 2022, an increase from CNY 216,365.2 million in 2021, which is a growth of 14.8%[25]. - The capital adequacy ratio stands at 12.5%, above the regulatory requirement, ensuring financial stability and growth capacity[10]. - The total assets of the bank as of December 31, 2022, amounted to RMB 267,000.7 million, showing a significant increase from RMB 234,140.2 million in the previous year[168]. - The bank's asset-liability gap was RMB 18,619.3 million, indicating a stable management of interest rate risk[169]. - The bank's cash and deposits with the central bank totaled RMB 34,642.8 million, reflecting a strong liquidity position[179]. Loan and Deposit Growth - The net amount of loans and advances increased by 11.8% to RMB 170,597.4 million compared to the previous year[29]. - Total deposits amounted to RMB 227,345.1 million, marking a 17.7% increase from the previous year[29]. - The total amount of loans and advances issued by the group reached RMB 172,029.4 million as of December 31, 2022, an increase of 9.7% compared to RMB 156,850.2 million in 2021[72]. - The total amount of corporate loans as of December 31, 2022, was RMB 145,044.6 million, representing 84.3% of total loans and advances issued[111]. Risk Management - The bank's risk management framework is structured with the board of directors as the highest decision-making body, focusing on various risks including credit, market, operational, liquidity, reputation, legal compliance, and information technology risks[159]. - The bank has implemented a mechanism for the disposal of non-performing assets, ensuring accountability in managing credit risk[162]. - The bank's market risk management strategy includes strict limit management and regular stress testing to adjust strategies based on market conditions[164]. - The bank has integrated anti-money laundering (AML) risk management into its comprehensive risk management system, with the board of directors bearing ultimate responsibility for AML risk management[189]. Digital Transformation and Innovation - New digital banking services are set to launch in Q2 2023, aiming to increase user engagement by 25%[5]. - The company has established a comprehensive online financial service platform utilizing cloud-native design, big data, and AI to enhance service efficiency and security[156]. - The group aims to enhance digital transformation by implementing new community banking models and increasing the deployment of smart counters[145]. - The company launched the "Agricultural Machinery Loan" product, which allows for online processing from application to disbursement, aimed at supporting agricultural production organizations[156]. Awards and Recognition - Jilin Jiutai Rural Commercial Bank was awarded as the Most Socially Responsible Listed Company by Zhitong Finance and Tonghuashun Finance in 2022[21]. - The bank ranked among the top 100 in China's banking industry and the top 1000 globally in 2022, as recognized by the China Banking Association and The Banker magazine respectively[21]. - The bank received the Outstanding Contribution Award for Financial Services to the Real Economy in 2022 from Daily Economic News[21]. - The bank's intelligent security SDN platform was awarded as an Excellent Case in Cybersecurity by the third selection of outstanding cases for technology innovation in rural small and medium financial institutions[21]. Corporate Strategy - The bank plans to expand its branch network by 20% in the next fiscal year to enhance customer accessibility[4]. - Future guidance estimates a revenue growth of 10-12% for 2023, driven by increased lending and service diversification[7]. - The strategic vision includes transforming the company into a leading modern and branded rural commercial bank in China[28]. - The group plans to continue expanding its market presence and enhancing its financial services in response to regulatory policies and market demands[31].
九台农商银行(06122) - 2022 - 年度业绩
2023-03-30 22:30
Financial Performance - For the year ended December 31, 2022, the total operating income was RMB 14,382.7 million, an increase of 14.8% compared to RMB 12,524.3 million in 2021[5]. - Net interest income for 2022 was RMB 6,514.9 million, representing a growth of 5.5% from RMB 6,176.4 million in 2021[5]. - The net profit attributable to the owners of the bank for 2022 was RMB 1,970.0 million, up from RMB 1,719.0 million in 2021, reflecting a year-on-year increase of 14.6%[5]. - The bank's total assets reached RMB 98.6 billion by the end of 2022, compared to RMB 87.3 billion in 2021, marking a growth of 10.5%[5]. - The bank's fee and commission income for 2022 was RMB 1,983.5 million, an increase from RMB 1,747.5 million in 2021, indicating a growth of 13.5%[5]. - The bank's investment securities net income was RMB 1,672.0 million for 2022, compared to RMB 1,290.0 million in 2021, reflecting a significant increase of 29.6%[5]. - The total operating income for 2022 was RMB 6,597.1 million, an increase of 3.7% from RMB 6,362.3 million in 2021[10]. - Net profit rose by 29.6% to RMB 1,672.0 million in 2022, up from RMB 1,290.0 million in 2021[10]. - Total assets reached RMB 267,000.7 million, reflecting a year-on-year growth of 14.0%[10]. - The net amount of loans and advances was RMB 170,597.4 million, which represents an 11.8% increase compared to the previous year[10]. Asset Quality - The bank's non-performing loan ratio was reported at 1.8% for 2022, a slight increase from 1.7% in 2021[5]. - The non-performing loan ratio was 1.98%, an increase of 0.1 percentage points year-on-year[10]. - Non-performing loans amounted to RMB 3,405.2 million as of December 31, 2022, categorized into substandard, doubtful, and loss categories[77]. - The non-performing loan (NPL) ratio increased from 1.88% as of December 31, 2021, to 1.98% as of December 31, 2022, primarily due to external economic conditions and the impact of the COVID-19 pandemic[79]. - The manufacturing sector had the highest NPL rate at 4.08% as of December 31, 2022, followed by the wholesale and retail sector at 1.29%[81]. - The NPL ratio for retail loans increased from 3.27% as of December 31, 2021, to 4.36% as of December 31, 2022, primarily due to ongoing impacts of COVID-19 and slower recovery of personal income stability[85]. Capital and Liquidity - The core Tier 1 capital adequacy ratio was 8.91%, slightly up from 8.83% in 2021[10]. - The total capital adequacy ratio as of December 31, 2022, was 11.50%, slightly down from 11.63% as of December 31, 2021[179]. - The net core tier 1 capital increased to RMB 17,240.2 million as of December 31, 2022, from RMB 15,896.7 million as of December 31, 2021[179]. - The total risk-weighted assets amounted to RMB 193,589.1 million as of December 31, 2022, up from RMB 180,086.9 million as of December 31, 2021[179]. - The bank's liquidity risk management framework includes a board of directors responsible for approving policies and strategies, with a focus on proactive management and maintaining overall liquidity stability[157]. - The bank's cash and deposits with the central bank reached RMB 34,642.8 million, a significant increase from RMB 30,998.0 million, reflecting a growth of approximately 11.88%[148]. Operational Changes and Strategy - The bank plans to expand its market presence by enhancing digital banking services and increasing customer engagement through new technology initiatives[2]. - The bank's board has confirmed the resignation of the chairman, Gao Bing, effective immediately, which may lead to changes in strategic direction[2]. - The bank is currently in the process of changing its legal representative, which may impact its governance structure moving forward[2]. - The company plans to continue expanding its loan offerings to meet diverse financial service needs, contributing to steady growth in net interest income[18]. - The company aims to enhance financial services and improve online service accessibility in response to the challenges posed by the COVID-19 pandemic[193]. - The company plans to continue focusing on local market development and risk control to achieve high-quality growth[193]. Risk Management - The bank's comprehensive risk management framework addresses credit, market, operational, liquidity, reputational, legal compliance, information technology, and anti-money laundering risks[139]. - The company has established a comprehensive credit risk management system involving the board, risk management committees, and various departments to enhance credit risk oversight[140]. - The company has strengthened its anti-money laundering (AML) framework, integrating it into the overall risk management system and enhancing the monitoring and reporting processes[170]. - The company has improved its AML risk management level by enhancing internal controls and conducting self-inspections to prevent and mitigate money laundering activities[170]. Shareholder Information - The board of directors has recommended not to distribute a final dividend for the year ending December 31, 2022, pending approval at the upcoming annual general meeting[188]. - The company has a total share capital of 5,074,191,569 shares, with 4,107,690,457 domestic shares (81.0%) and 966,501,112 H shares (19.0%)[192]. - The company is obligated to withhold a corporate income tax of 10% on dividends distributed to non-resident corporate shareholders[190]. - The annual general meeting for shareholders is scheduled for June 16, 2023, with a suspension of H share transfer registration from May 17 to June 16, 2023[191].
九台农商银行(06122) - 2022 - 中期财报
2022-09-22 08:30
Ownership and Control of Banks - Jilin Jiutai Rural Commercial Bank holds a 51.00% stake in Anci District Huimin Village Bank, which was established in December 2011[3] - The bank has a 28.17% stake in Anping Huimin Village Bank, established in December 2013, with a voting agreement in place with other shareholders[3] - Jilin Jiutai Rural Commercial Bank controls Baicheng Taobei Huimin Village Bank with a 49.00% stake, established in November 2015, and has a voting agreement with other shareholders[3] - The bank has a 38.80% stake in Changbai Mountain Rural Commercial Bank, established in December 2011[5] - Jilin Jiutai Rural Commercial Bank holds a 40.00% stake in Changchun Gaoxin Huimin Village Bank, established in September 2013, with a voting agreement with other shareholders[5] - The bank has a 51.20% stake in Changchun Nanguan Huimin Village Bank, established in January 2011[6] - Jilin Jiutai Rural Commercial Bank controls Daan Huimin Village Bank with a 51.46% stake, established in January 2011[6] - The bank has a 42.85% stake in Fuyu Huimin Village Bank, established in December 2015, with a voting agreement with other shareholders[6] - Jilin Jiutai Rural Commercial Bank holds a 56.70% stake in Gaomi Huimin Village Bank, established in May 2011[6] - The bank 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[8] - The company owns 46.00% of Jilin Chuanying Huimin Village Bank, also classified as a subsidiary[8] - The company has a 20.20% ownership in Jilin Gongzhuling Rural Commercial Bank, with the remaining 79.80% held by 532 other shareholders[9] - The company controls 33.15% of Jingmen Dongbao Huimin Village Bank, which is classified as a subsidiary[9] - The company has a 17.87% stake in Leizhou Huimin Village Bank, with 82.13% held by other shareholders[10] - The company owns 34.36% of Liaoyuan Rural Commercial Bank, which is also considered a subsidiary[10] - The company holds a 60.00% stake in Lujiang Huimin Village Bank, with the remaining 40.00% held by 49 other shareholders[11] - The company has a 45.25% ownership in Qian'an Huimin Village Bank, classified as a subsidiary[11] - The company has established voting agreements with various shareholders across its subsidiaries, ensuring control over board meetings and shareholder meetings[8][9][10][11] Financial Performance - Interest income for the first half of 2022 was RMB 6,759.5 million, an increase of 18.9% compared to RMB 5,686.7 million in the same period of 2021[23] - Net interest income reached RMB 2,947.6 million, reflecting an 8.6% growth from RMB 2,715.3 million year-on-year[23] - Total assets as of June 30, 2022, amounted to RMB 259,460.1 million, representing a 10.8% increase from RMB 234,140.2 million at the end of 2021[24] - Total liabilities were RMB 241,005.0 million, up 11.4% from RMB 216,365.2 million at the end of 2021[24] - The bank's net profit for the first half of 2022 was RMB 653.6 million, a 27.5% increase from RMB 512.5 million in the same period of 2021[23] - Basic earnings per share for the first half of 2022 were RMB 0.14, up 55.6% from RMB 0.09 in the first half of 2021[23] - Total equity as of June 30, 2022, was RMB 18,455.1 million, a 3.8% increase from RMB 17,775.0 million at the end of 2021[24] - The bank's total loans and advances amounted to RMB 168,340.3 million, reflecting a 10.3% increase from RMB 152,642.7 million at the end of 2021[24] - The bank's commission and fee income was RMB 63.1 million, slightly down by 1.4% from RMB 64.0 million in the previous year[23] - For the six months ended June 30, 2022, the total operating income was RMB 3,151.8 million, an increase of 14.5% compared to RMB 2,752.0 million for the same period in 2021[29] - Net profit rose by 27.5% to RMB 653.6 million for the six months ended June 30, 2022, up from RMB 512.5 million for the same period in 2021[29] - Net interest income increased by 8.6% to RMB 2,947.6 million for the six months ended June 30, 2022, compared to RMB 2,715.3 million for the same period in 2021[29] - As of June 30, 2022, total assets amounted to RMB 259,460.1 million, reflecting a growth of 10.8% since the beginning of the year[29] - The net amount of loans and advances increased by 10.3% to RMB 168,340.3 million compared to the beginning of the year[29] - The non-performing loan ratio was 1.96%, an increase of 0.08 percentage points from the beginning of the year[29] - Total deposits reached RMB 217,528.1 million, representing a growth of 12.6% since the beginning of the year[29] - The cost-to-income ratio improved to 40.64%, down from 44.24% in the previous year, indicating better operational efficiency[25] - The core tier 1 capital adequacy ratio was 8.51%, slightly down from 8.83% in the previous year, reflecting a focus on maintaining capital strength[25] Loan and Asset Management - The company plans to enhance community financial services and expand retail banking operations to capture growth potential in personal financial services[28] - The company expanded its loan issuance to support the real economy, rural revitalization, and small and medium enterprises, contributing to the growth in net interest income[30] - Operating expenses and asset impairment losses increased, partially offsetting the gains in net interest income[30] - The average interest rate on interest-earning assets was 5.49%, slightly down from 5.56% in the previous year[31] - The company plans to continue expanding its funding channels based on market conditions to enhance capital utilization efficiency[30] - The average balance of interest-earning assets rose from RMB 204,698.7 million to RMB 246,200.2 million, contributing to the increase in interest income[40] - The interest income from loans and advances accounted for 85.2% of total interest income in the six months ended June 30, 2022, up from 80.5% in the same period of 2021[41] - Interest income from loans and advances grew by 25.8% to RMB 5,757.1 million, driven by an increase in average balance from RMB 144,393.4 million to RMB 171,652.8 million[42] - The average yield on loans and advances increased from 6.34% to 6.71% due to a higher proportion of medium to long-term loans[42] - Interest income from investment securities and other financial assets decreased by 21.1% to RMB 664.3 million, primarily due to a drop in average yield from 5.96% to 4.14%[43] - Interest income from interbank placements fell by 1.0% to RMB 95.1 million, with the average yield declining from 1.62% to 1.38%[44] - Interest income from repurchase agreements surged by 125.5% to RMB 115.0 million, attributed to an increase in average balance from RMB 3,225.1 million to RMB 10,398.1 million[45] - Interest income from deposits with the central bank increased by 4.7% from RMB 105.3 million for the six months ended June 30, 2021, to RMB 110.3 million for the six months ended June 30, 2022, due to an increase in average balance from RMB 16,162.3 million to RMB 17,298.5 million, despite a slight decrease in average yield from 1.30% to 1.28%[46] - Interest income from funds lent out rose by 3.5% from RMB 17.1 million for the six months ended June 30, 2021, to RMB 17.7 million for the six months ended June 30, 2022, driven by an increase in average balance from RMB 810.1 million to RMB 936.9 million, although offset by a decline in average yield from 4.22% to 3.78%[47] - The net interest margin decreased to 2.29% from 2.52% in the previous year[34] - The company aims to enhance credit support for enterprises affected by the pandemic, focusing on meeting reasonable credit demands[79] - The company has implemented stricter credit assessment standards for guaranteed loans, primarily accepting guarantees from listed companies or guarantee companies[83] Risk Management - The bank has established a comprehensive risk management system to mitigate uncertainties affecting strategic and operational goals[162] - Credit risk management focuses on corporate loans, retail loans, and funding operations, with a structured organization involving various committees and departments[163] - In the first half of 2022, the bank enhanced credit risk management processes, ensuring asset quality and timely identification of credit risks[165] - Market risk management aims to control potential market losses within acceptable levels while maximizing risk-adjusted returns[166] - The bank employs tools such as sensitivity analysis, duration, and Value at Risk (VaR) to measure and manage market risks effectively[167] - Interest rate risk management addresses risks from mismatches in the timing of asset and liability repricing, with a focus on maintaining controllable risk levels[168] - The bank strengthened interest rate risk management by enhancing internal fund transfer pricing (FTP) and loan pricing systems (RPM), optimizing resource allocation and improving risk control capabilities[169] - In the first half of 2022, the bank conducted regular stress tests on interest rate risk, assessing the impact of interest rate fluctuations on economic value under various scenarios[169] - The bank implemented measures to manage foreign exchange risk, including real-time monitoring of foreign exchange positions and hedging strategies to minimize exposure and stabilize earnings[170] - The bank's liquidity risk management framework was reinforced, ensuring stability in liquidity levels despite external pressures such as the pandemic[173] - The bank increased the proportion of core liabilities and enhanced the reserve of high-quality liquid assets to reduce reliance on interbank financing[174] - The bank conducted regular liquidity stress tests to evaluate cash flow gaps and financing capabilities under extreme scenarios, improving its response to liquidity risks[174] - The bank's operational risk management included quarterly checks on employee behavior and accounting practices to mitigate potential risks[172] - The bank's information management systems maintained 100% availability, ensuring operational resilience against power outages and equipment failures[172] - The bank's risk management policies were aligned with its development strategy and shareholder value requirements, balancing growth and risk effectively[169] Shareholder and Capital Structure - The bank's capital adequacy ratios must meet specific regulatory requirements, with a minimum capital adequacy ratio of 10.5% and a minimum Tier 1 capital ratio of 8.5% as of June 30, 2022[191] - The number of shares outstanding as of June 30, 2022, was 4,612,901,427, with domestic shares accounting for 81.0% and H shares for 19.0%[194] - The company issued additional shares, increasing the total to 5,074,191,569 shares post-capitalization[195] - The top ten domestic shareholders held a combined total of 1,805,590,338 shares, representing approximately 39.13% of the issued capital[197] - The largest shareholder, Jilin Trust Co., Ltd., held 443,289,245 shares, accounting for 9.61% of the total[198] - The second-largest shareholder, Changchun Huaxing Construction Co., Ltd., held 379,766,198 shares, representing 8.23%[198] - The company reported an increase in undistributed profits to RMB 2,166.6 million from RMB 1,436.8 million year-over-year[192] - The tier 1 capital ratio was 8.60%, down from 8.96% in the previous year[192] Operational Developments - The bank's data center achieved 100% availability in its overall operation and maintenance as of June 30, 2022[159] - The bank conducted 8 emergency drills in the first half of 2022, enhancing its emergency response capabilities[160] - The bank's technology personnel obtained 14 advanced certifications and qualifications, including RPA Engineer Certification and PMP[161] - The online financial comprehensive service platform project won the "IT Architecture Innovation Excellent Case Award" in 2022[161] - The bank established six service centers in various provinces to support the operations of its village banks[155] - The bank is actively developing a digital banking platform and enhancing self-service equipment functionalities as part of its financial technology innovation plan[158] - The group operated 383 business outlets as of June 30, 2022, with 175 directly managed by the group and the rest by subsidiaries[147] - The group had 395 self-service business outlets and 989 self-service devices as of June 30, 2022, enhancing customer convenience[148] - The number of telephone and SMS banking customers reached 2,829,820 as of June 30, 2022, indicating a significant customer base for remote banking services[149] - Online banking customers totaled 468,205 as of June 30, 2022, reflecting the group's digital service adoption[150] - The group reported 964,243 mobile banking customers as of June 30, 2022, showcasing the popularity of mobile banking services[151] Wealth Management and Retail Banking - The total amount of wealth management products sold to retail customers was RMB 4,719.7 million for the six months ended June 30, 2022, compared to RMB 3,198.1 million for the same period in 2021, representing a growth of 47.5%[131] - The total amount of investment securities and other financial assets increased by 7.9% from RMB 30,806.5 million as of December 31, 2021, to RMB 33,240.5 million as of June 30, 2022[140] - The group’s net fee and commission income for the six months ended June 30, 2022, was RMB 20.4 million, compared to RMB 0.3 million in the same period of 2021, indicating a significant increase[133] - The group’s total assets under management for wealth management services included customized financial services amounting to RMB 360.0 million for the six months ended June 30, 2022, compared to RMB 331.5 million in the same period of 2021[131] - The company is committed to expanding its retail banking services and enhancing customer engagement through various financial products[124] - The total number of retail loan customers reached 69,756, with total loans and advances amounting to RMB 27,279.9 million as of June 30, 2022[124] - Retail banking operating income was RMB 1,444.3 million in 2022, reflecting a 13.5% increase from RMB 1,272.1 million in 2021[125] - Retail deposits totaled RMB 168,964.3 million as of June 30, 2022, compared to RMB 143,412.8 million as of December 31, 2021, representing 77.7% of total deposits[127] Corporate Banking and Client Relationships - The company aims to strengthen long-term relationships with corporate clients, particularly focusing on small and medium-sized enterprises[116] - The company has partnered with various financial institutions to provide comprehensive financial services to corporate clients[116] - The company reported a pre-tax profit of RMB 559.6 million for corporate banking, a significant increase from a loss of RMB 92.9 million in the previous year[114] - The net interest income for corporate banking was RMB 2,045.7 million in 2022, a 47.8% increase from RMB 1,384.5 million in 2021[114] - The operating income from corporate banking increased to RMB 2,051.8 million in 2022, up 45.1% from RMB 1,413.7 million in 2021[114] - As of June 30, 2022, the total loan amount for corporate clients reached RMB 144,577.5 million, representing an increase from RMB 130,241.9 million as of December 31, 2021, accounting for 84.1% of total loans issued[116]
九台农商银行(06122) - 2021 - 年度财报
2022-04-26 13:13
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].
九台农商银行(06122) - 2020 - 年度财报
2021-04-26 08:48
[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** |
九台农商银行(06122) - 2019 - 年度财报
2020-04-24 13:14
[Chairman's Statement](index=5&type=section&id=Chairman%27s%20Statement) The Chairman reviews the Bank's strategic focus on credit, private enterprises, and SMEs, achieving stable performance in 2019 - In 2019, facing complex economic and financial conditions, the Bank maintained strategic focus, promoting structural adjustment, risk prevention, strengthened management, and transformation, achieving stable and improving performance. The Bank remained committed to its core lending business, allocating more resources to the private economy, SMEs, and agriculture, rural areas, and farmers sectors[22](index=22&type=chunk) Key Financial Data of the Group as of End of 2019 | Indicator | Amount (RMB billion) | | :--- | :--- | | Total Assets | 173.28 | | Total Deposits | 122.84 | | Total Loans and Advances | 96.10 | | Net Profit | 1.20 | [President's Statement](index=7&type=section&id=President%27s%20Statement) The President highlights the Bank's steady progress in 2019 through its "four-in-one" strategy, optimizing asset-liability structure - In 2019, the Bank's management fully implemented the "four-in-one" strategy of "agriculture, rural areas, and farmers finance, community finance, cooperation platform, and public welfare and charity," maintaining stable and improving operational momentum. Business transformation yielded significant results, reducing interbank business scale and further optimizing the asset-liability structure[26](index=26&type=chunk) Key Financial Data of the Bank as of End of 2019 | Indicator | Amount (RMB billion) | | :--- | :--- | | Total Assets | 124.79 | | Total Deposits | 77.85 | | Total Loans and Advances | 64.24 | | Net Profit | 0.95 | [Chapter 1 Definitions and Technical Terms](index=8&type=section&id=Chapter%201%20Definitions%20and%20Technical%20Terms) This chapter provides definitions of key terms and technical vocabulary used throughout the report [Chapter 2 Company Profile](index=20&type=section&id=Chapter%202%20Company%20Profile) This chapter outlines the Bank's fundamental information, historical development, and key achievements in 2019 [I. Basic Information of the Bank](index=20&type=section&id=I.%20Basic%20Information%20of%20the%20Bank) This section provides key details of Jilin Jiutai Rural Commercial Bank, including registration, address, contact, listing, and advisors - The company's Chinese abbreviation is "Jiutai Rural Commercial Bank," and its H shares are listed on the Hong Kong Stock Exchange with stock code **06122**[42](index=42&type=chunk)[43](index=43&type=chunk) [II. History of the Bank](index=23&type=section&id=II.%20History%20of%20the%20Bank) The Bank was restructured from the former Jiutai City Rural Credit Cooperative Union on December 16, 2008, and its H shares were listed on the HKEX on January 12, 2017 - The Bank was formally 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**[46](index=46&type=chunk) [III. Major Awards and Honors in 2019](index=24&type=section&id=III.%20Major%20Awards%20and%20Honors%20in%202019) In 2019, the Group received multiple important industry awards for its outstanding performance in agriculture, inclusive finance, and targeted poverty alleviation - The Bank received numerous accolades, including "2019 Excellent Competitiveness Agriculture, Rural Areas, and Farmers Financial Service Bank," "2019 Inclusive Finance Business Bank of the Year," and "2019 Golden Precision Poverty Alleviation Bank Institution of the Year"[49](index=49&type=chunk) - In interbank market trading, the Bank was recognized as "2018 Top 300 Interbank Local Currency Market Trader" and "2018 Top 100 Interbank RMB Foreign Exchange Market Trader"[48](index=48&type=chunk) [Chapter 3 Financial Highlights](index=28&type=section&id=Chapter%203%20Financial%20Highlights) This chapter presents a summary of the Group's key financial performance and ratios for 2018 and 2019 2018-2019 Group Financial Performance Highlights | Indicator (RMB million) | 2019 | 2018 | YoY Change | | :--- | :--- | :--- | :--- | | **Operating Performance** | | | | | Operating Income | 5,311.4 | 5,037.6 | +5.4% | | Net Interest Income | 4,165.4 | 3,520.1 | +18.3% | | Profit for the Year | 1,195.7 | 1,183.6 | +1.0% | | Profit Attributable to Owners of the Bank | 1,042.2 | 982.9 | +6.0% | | **Assets/Liabilities** | | | | | Total Assets | 173,275.5 | 164,253.2 | +5.5% | | Net Loans and Advances to Customers | 93,394.2 | 75,354.5 | +24.0% | | Deposits from Customers | 122,840.4 | 109,521.2 | +12.2% | | Total Equity | 15,660.1 | 15,107.5 | +3.7% | 2018-2019 Key Financial Ratios | Indicator (%) | 2019 | 2018 | Change | | :--- | :--- | :--- | :--- | | **Profitability** | | | | | Return on Assets | 0.71% | 0.67% | +0.04pp | | Return on Equity | 7.77% | 7.45% | +0.32pp | | Net Interest Margin | 2.74% | 2.36% | +0.38pp | | Net Interest Spread | 2.75% | 2.22% | +0.53pp | | Cost-to-Income Ratio | 51.08% | 54.72% | -3.64pp | | **Capital Adequacy** | | | | | Core Tier 1 Capital Adequacy Ratio | 9.55% | 9.40% | +0.15pp | | Capital Adequacy Ratio | 11.98% | 11.83% | +0.15pp | | **Asset Quality** | | | | | Non-performing Loan Ratio | 1.68% | 1.75% | -0.07pp | | Provision Coverage Ratio | 167.58% | 160.41% | +7.17pp | [Chapter 4 Management Discussion and Analysis](index=31&type=section&id=Chapter%204%20Management%20Discussion%20and%20Analysis) This chapter provides an in-depth review of the Group's operating environment, strategic direction, business performance, and risk management in 2019 [4.1 Environment and Outlook](index=31&type=section&id=4.1%20Environment%20and%20Outlook) Looking ahead to 2020, despite economic downturn and COVID-19 impacts, China's long-term economic fundamentals remain positive, guiding the Bank's stable development - The world economy is expected to slow down in 2020, but China's long-term positive economic fundamentals remain unchanged, with the government implementing various counter-cyclical policies to address the pandemic and downward pressure[55](index=55&type=chunk) - The Bank will adhere to the principle of seeking progress while maintaining stability, deeply implementing the "four-in-one" strategy of "agriculture, rural areas, and farmers finance, community finance, cooperation platform, and public welfare and charity," focusing on its core business, adjusting structure, and preventing risks[55](index=55&type=chunk) [4.2 Development Strategy](index=32&type=section&id=4.2%20Development%20Strategy) The Group aims to become a leading modern and branded rural commercial bank, consolidating its strengths in agriculture and SME services while expanding retail and new businesses - The Group's strategic goal is to build a leading modern and branded rural commercial bank in China[56](index=56&type=chunk) - To achieve its goals, the Group plans to: - Consolidate its advantages in "agriculture, rural areas, and farmers" and SME banking services - Develop retail banking business - Expand emerging businesses and promote transformation of growth models - Strengthen risk management and internal control - Recruit, cultivate, and incentivize high-quality talent[56](index=56&type=chunk) [4.3 Overall Business Review](index=32&type=section&id=4.3%20Overall%20Business%20Review) In 2019, the Group maintained stable and progressive development, with operating income growing 5.4% and net profit increasing 1.0%, alongside asset expansion and improved asset quality 2019 Key Operating Indicators | Indicator | 2019 | YoY Growth | | :--- | :--- | :--- | | Total Operating Income | RMB 5.31 billion | +5.4% | | Net Profit | RMB 1.20 billion | +1.0% | | Total Assets | RMB 173.28 billion | +5.5% | | Total Loans and Advances | RMB 96.10 billion | +24.0% | | Total Deposits | RMB 122.84 billion | +12.2% | | Non-performing Loan Ratio | 1.68% | -0.07 percentage points | [4.3 (a) Consolidated Income Statement Analysis](index=33&type=section&id=4.3%20%28a%29%20Consolidated%20Income%20Statement%20Analysis) In 2019, the Group's pre-tax profit grew 4.4% to RMB 1.50 billion, and profit for the year increased 1.0% to RMB 1.20 billion, driven by strong net interest income growth - Net interest income, the largest component of operating income, increased by **18.3%** to **RMB 4.17 billion**, rising from **69.9%** to **78.4%** of total operating income, serving as the primary driver of profit growth[60](index=60&type=chunk)[61](index=61&type=chunk) - Net interest margin expanded from **2.36%** to **2.74%**, and net interest spread increased from **2.22%** to **2.75%**, primarily due to a rise in the average yield on interest-earning assets and a slight decrease in the average cost of interest-bearing liabilities[83](index=83&type=chunk) - Net fee and commission income decreased by **15.7%** year-on-year, mainly due to reduced fee income from syndicated loans, settlement and clearing, and wealth management businesses[86](index=86&type=chunk) - Asset impairment losses increased by **22.2%** year-on-year to **RMB 1.09 billion**, primarily due to increased provisions corresponding to loan growth and higher impairment provisions for financial assets measured at amortized cost in response to the economic environment[100](index=100&type=chunk) [4.3 (b) Consolidated Statement of Financial Position Analysis](index=49&type=section&id=4.3%20%28b%29%20Consolidated%20Statement%20of%20Financial%20Position%20Analysis) As of end-2019, the Group's total assets reached RMB 173.28 billion, with a significant shift towards credit business, and deposits remaining the primary funding source - Total loans and advances increased by **24.0%** year-on-year to **RMB 96.10 billion**, with corporate loans growing by **28.9%** and retail loans by **10.5%**[105](index=105&type=chunk)[107](index=107&type=chunk)[108](index=108&type=chunk) - Investment securities and other financial assets decreased by **15.6%** year-on-year to **RMB 39.22 billion**, primarily due to reduced investments in bonds and asset management plans in accordance with regulatory policies and market conditions[115](index=115&type=chunk) - Total deposits increased by **12.2%** year-on-year to **RMB 122.84 billion**, primarily benefiting from strengthened pricing management, improved service levels, and increased marketing efforts[120](index=120&type=chunk) [4.3 (c) Asset Quality Analysis](index=57&type=section&id=4.3%20%28c%29%20Asset%20Quality%20Analysis) The Group's asset quality remained stable with slight improvement, as the non-performing loan ratio decreased, though loan concentration increased Loan Five-Category Classification and NPL Ratio | Classification | Amount as of 2019-end (RMB million) | Proportion (%) | Amount as of 2018-end (RMB million) | Proportion (%) | | :--- | :--- | :--- | :--- | :--- | | Normal | 92,902.1 | 96.8 | 75,021.0 | 96.8 | | Special Mention | 1,584.9 | 1.6 | 1,151.9 | 1.5 | | Substandard | 521.0 | 0.5 | 363.6 | 0.5 | | Doubtful | 1,067.1 | 1.1 | 965.0 | 1.2 | | Loss | 28.9 | 0.0 | 26.2 | 0.0 | | **Total Non-performing Loans** | **1,617.0** | **1.68** | **1,354.8** | **1.75** | - The non-performing loan ratio for corporate loans decreased from **1.88%** to **1.60%**, while for retail loans it increased from **1.38%** to **1.94%**, mainly due to the impact of slowing economic growth causing difficulties for some customers[134](index=134&type=chunk) - The loan concentration for the top ten single borrowers increased to **46.62%** from **42.79%** in 2018, approaching the **50%** regulatory limit[129](index=129&type=chunk)[131](index=131&type=chunk) [4.4 Business Review](index=65&type=section&id=4.4%20Business%20Review) The Group's business is primarily divided into corporate banking, retail banking, and treasury operations, with corporate banking becoming the main growth driver in 2019 Operating Income Proportion by Business Segment | Business Segment | 2019 Income Proportion | 2018 Income Proportion | | :--- | :--- | :--- | | Corporate Banking Business | 63.9% | 49.7% | | Retail Banking Business | 10.7% | 19.7% | | Treasury Business | 21.8% | 26.3% | | Other | 3.6% | 4.3% | - Corporate banking business pre-tax profit significantly increased by **196.1%** to **RMB 1.11 billion**, primarily due to strong growth in net interest income[144](index=144&type=chunk) - Retail banking business shifted from a pre-tax profit of **RMB 240 million** in 2018 to a pre-tax loss of **RMB 130 million** in 2019, mainly due to a **44.5%** decrease in net interest income and a **137.7%** increase in asset impairment losses[155](index=155&type=chunk) - Treasury business pre-tax profit decreased by **32.0%** year-on-year to **RMB 390 million**, primarily affected by a decrease in other operating net income and an increase in asset impairment losses[165](index=165&type=chunk) [4.5 Risk Management](index=82&type=section&id=4.5%20Risk%20Management) The Group has established a comprehensive risk management system covering various risks, with the Board bearing ultimate responsibility and implementing a three-line defense model - Credit Risk Management: Managed through four mechanisms—customer access, credit exit, risk early warning, and non-performing asset disposal; in 2019, the focus was on optimizing credit allocation and intensifying efforts to recover and dispose of non-performing assets[195](index=195&type=chunk)[196](index=196&type=chunk) - Market Risk Management: Primarily exposed to interest rate risk and exchange rate risk. The Bank enhances interest rate risk control through internal funds transfer pricing (FTP) and loan pricing systems, and manages exchange rate risk using foreign exchange exposure analysis and sensitivity analysis[198](index=198&type=chunk)[199](index=199&type=chunk)[206](index=206&type=chunk) - Liquidity Risk Management: Ensures stable liquidity indicators and sufficient standby capacity by optimizing asset-liability structure (increasing deposits, reducing interbank liabilities), strengthening position management, and conducting stress tests[210](index=210&type=chunk) - Anti-Money Laundering Management: Integrates AML risk into the comprehensive risk management system; in 2019, the Bank conducted risk self-assessments, customer information governance, specialized training, and public awareness campaigns to enhance risk prevention and control capabilities[222](index=222&type=chunk)[223](index=223&type=chunk) [4.6 Capital Adequacy Ratio Analysis](index=101&type=section&id=4.6%20Capital%20Adequacy%20Ratio%20Analysis) As of end-2019, the Group's capital adequacy ratios met regulatory requirements and showed slight improvements, maintaining a robust capital base Capital Adequacy Ratio Indicators | Indicator | December 31, 2019 | December 31, 2018 | Regulatory Requirement (2019) | | :--- | :--- | :--- | :--- | | Core Tier 1 Capital Adequacy Ratio | 9.55% | 9.40% | ≥ 7.50% | | Tier 1 Capital Adequacy Ratio | 9.66% | 9.50% | ≥ 8.50% | | Capital Adequacy Ratio | 11.98% | 11.83% | ≥ 10.50% | [Chapter 5 Board of Directors' Report](index=103&type=section&id=Chapter%205%20Board%20of%20Directors%27%20Report) The Board of Directors reports on the Bank's financial performance, dividend proposals, capital plans, and significant transactions for the year - The Board of Directors recommends a final dividend of **RMB 0.18** per share (tax inclusive) for the year ended December 31, 2019, totaling an estimated **RMB 753 million**[244](index=244&type=chunk) - The Board of Directors proposes a capitalization issue of **5 shares for every 100 shares** from capital reserves, which will increase the total share capital to **4.393 billion shares** upon completion[246](index=246&type=chunk) - During the reporting period, the Bank sold part of its equity in Jilin Dehui Rural Commercial Bank, reducing its stake from **45%** to **9.9%**, primarily to optimize its external investment portfolio[293](index=293&type=chunk) - The Bank plans to issue Tier 2 capital bonds not exceeding **RMB 1.3 billion** and capital replenishment bonds not exceeding **RMB 4 billion** to supplement its capital[286](index=286&type=chunk) - The Bank intends to conduct a non-public offering of not more than **50 million** overseas preference shares to raise funds equivalent to not more than **RMB 5 billion** for supplementing other Tier 1 capital[287](index=287&type=chunk) [Chapter 6 Supervisory Board Report](index=124&type=section&id=Chapter%206%20Supervisory%20Board%20Report) The Supervisory Board reports on its oversight activities in 2019, including meetings, review of proposals, and independent opinions on the Bank's operations - During the reporting period, the Supervisory Board held **4** meetings, reviewed **77** proposals, and effectively supervised the performance of the Board of Directors and senior management, financial status, internal control, risk management, and compliance operations[299](index=299&type=chunk) - The Supervisory Board issued an independent opinion, affirming that the Bank's operations were legal and compliant, the directors and senior management diligently performed their duties, the financial reports were true and fair, related-party transactions did not harm the Bank's interests, and the internal control system had no significant defects[303](index=303&type=chunk)[304](index=304&type=chunk) [Chapter 7 Share Capital Changes and Shareholder Details](index=129&type=section&id=Chapter%207%20Share%20Capital%20Changes%20and%20Shareholder%20Details) This chapter details the Bank's share capital structure and major shareholders as of December 31, 2019 Share Capital Structure as of December 31, 2019 | Share Class | Number of Shares | Approximate Percentage (%) | | :--- | :--- | :--- | | Domestic Shares | 3,387,087,577 | 81.0 | | H Shares | 796,950,000 | 19.0 | | **Total** | **4,184,037,577** | **100.0** | Top Three Domestic Shareholders as of December 31, 2019 | Shareholder Name | Number of Shares Held | Proportion of Total Share Capital (%) | | :--- | :--- | :--- | | Jilin Province Trust Co., Ltd. | 402,076,412 | 9.61 | | Changchun Huaxing Construction Co., Ltd. | 344,459,136 | 8.23 | | Changchun Huamei Tourism Culture Media Co., Ltd. | 189,115,914 | 4.52 | - The Bank's equity structure is dispersed, with no controlling shareholder or actual controller. The largest shareholder is Jilin Province Trust Co., Ltd., holding **9.61%** of the shares[314](index=314&type=chunk) [Chapter 8 Directors, Supervisors, Senior Management, Employees, and Organization](index=134&type=section&id=Chapter%208%20Directors%2C%20Supervisors%2C%20Senior%20Management%2C%20Employees%2C%20and%20Organization) This chapter provides an overview of changes in the Bank's Board, senior management, and employee structure in 2019 - Changes in Board members during the reporting period: Ms. Guo Yan resigned, and Mr. Cui Qiang was appointed as a non-executive director; Mr. Li Beiwei resigned, and Ms. Zhang Qiuhua was appointed as an independent non-executive director[322](index=322&type=chunk) - Changes in senior management: Mr. Zhang Haishan no longer served as President, with Executive Director Mr. Liang Xiangmin taking over. Mr. Chen Xinzhe was appointed as Vice President[323](index=323&type=chunk) - As of December 31, 2019, the Group had **6,219** full-time employees, with retail banking staff accounting for the highest proportion (**48%**). Over **59%** of employees held a bachelor's degree or above[350](index=350&type=chunk)[351](index=351&type=chunk) [Chapter 9 Corporate Governance Report](index=159&type=section&id=Chapter%209%20Corporate%20Governance%20Report) This chapter details the Bank's adherence to corporate governance principles, including Board and Supervisory Board structures and their respective committees - During the reporting period, the Bank fully complied with all code provisions contained in the Hong Kong Corporate Governance Code[361](index=361&type=chunk) - The Board of Directors comprises **13** members, including **3** executive directors, **5** non-executive directors, and **5** independent non-executive directors, meeting regulatory requirements. The Board has eight specialized committees: Strategy and Development, Audit, Connected Transactions Control, Risk Management, Nomination, Remuneration, Consumer Rights Protection, and Agriculture, Rural Areas, and Farmers Financial Services[367](index=367&type=chunk)[386](index=386&type=chunk) - The Supervisory Board consists of **7** supervisors and has a Nomination Committee and a Supervision Committee, overseeing the Bank's financial activities, risk management, internal control, and the performance of directors, supervisors, and senior management[401](index=401&type=chunk)[402](index=402&type=chunk)[410](index=410&type=chunk) [Chapter 10 Risk Management, Internal Control, and Internal Audit](index=201&type=section&id=Chapter%2010%20Risk%20Management%2C%20Internal%20Control%2C%20and%20Internal%20Audit) This chapter describes the Group's comprehensive risk management framework, internal control systems, and internal audit functions - The Group has established a comprehensive risk management system covering front, middle, and back offices. The Board of Directors bears ultimate responsibility, with specialized oversight by committees such as the Risk Management Committee and Audit Committee. The Supervisory Board oversees the Board of Directors and senior management's performance in risk management[436](index=436&type=chunk)[439](index=439&type=chunk)[444](index=444&type=chunk) - The senior management has five specialized committees: Risk Management and Control, Credit Approval, Information Technology, Asset-Liability Management, and Financial Management, responsible for implementing specific risk management measures[446](index=446&type=chunk) - The Bank has established an authorization management system and a credit management system, implementing separation of credit approval and strengthening management of credit business processes, loan classification, and corporate clients[452](index=452&type=chunk)[453](index=453&type=chunk) [Chapter 11 Environmental, Social, and Governance Report](index=211&type=section&id=Chapter%2011%20Environmental%2C%20Social%2C%20and%20Governance%20Report) This chapter outlines the Group's commitment and performance in environmental protection, social responsibility, and corporate governance - The Group established an ESG task force, coordinated by the President, responsible for identifying, reviewing, and supervising significant ESG matters, and reporting regularly to the Board of Directors[467](index=467&type=chunk) - In environmental protection, the Group promotes a low-carbon culture and green office practices. In 2019, total greenhouse gas emissions were **13,005 tonnes of CO2 equivalent**, a year-on-year decrease of approximately **12.3%**. Total electricity consumption and total water consumption also decreased by approximately **12.1%** and **9.9%**, respectively[496](index=496&type=chunk)[503](index=503&type=chunk)[506](index=506&type=chunk) - In social responsibility, the Group practices inclusive finance, serving "agriculture, rural areas, and farmers" and small and micro enterprises; it aids targeted poverty alleviation, forming a new model of "enterprise linkage, financial support, industry cultivation, and farmer benefit"; and actively engages in charitable activities, investing over **RMB 7.5 million** during the reporting period[513](index=513&type=chunk)[518](index=518&type=chunk)[525](index=525&type=chunk) [Independent Auditor's Report](index=244&type=section&id=Independent%20Auditor%27s%20Report) The independent auditor, Shinewing (HK) CPA Limited, issued an unmodified opinion on the Group's 2019 consolidated financial statements - Shinewing (HK) CPA Limited, the auditor, issued a standard unmodified opinion on the Group's 2019 consolidated financial statements[539](index=539&type=chunk) - Key audit matters included: - **Basis of Consolidation**: Reviewing management's assessment of control over non-principal subsidiaries, particularly the effectiveness of concerted action agreements - **Impairment of Loans and Advances**: Evaluating the expected credit loss (ECL) model, including the reasonableness of methodologies, assumptions, and data - **Goodwill Impairment**: Questioning key assumptions in the value-in-use calculation for cash-generating units, such as future cash flow forecasts, growth rates, and discount rates - **Information Technology System Outsourcing Arrangements**: Assessing the Group's controls over IT outsourcing arrangements and monitoring procedures for service providers[542](index=542&type=chunk)[543](index=543&type=chunk)[545](index=545&type=chunk)[549](index=549&type=chunk)[551](index=551&type=chunk) [Consolidated Financial Statements](index=253&type=section&id=Consolidated%20Financial%20Statements) This section presents the Group's consolidated financial statements, including the income statement, statement of financial position, statement of changes in equity, and cash flow statement [Consolidated Income and Other Comprehensive Income Statement](index=253&type=section&id=Consolidated%20Income%20and%20Other%20Comprehensive%20Income%20Statement) For the year ended December 31, 2019, the Group's operating income reached RMB 5.31 billion, a 5.4% increase, with net profit of RMB 1.20 billion, up 1.0% 2019 Consolidated Income Statement Summary | Item (RMB thousand) | 2019 | 2018 | | :--- | :--- | :--- | | Net Interest Income | 4,165,427 | 3,520,049 | | Net Fee and Commission Income | 316,466 | 375,604 | | Operating Income | 5,311,438 | 5,037,577 | | Operating Expenses | (2,787,448) | (2,851,399) | | Asset Impairment Losses | (1,088,080) | (890,169) | | Profit Before Tax | 1,503,474 | 1,439,740 | | **Profit for the Year** | **1,195,695** | **1,183,664** | | Profit Attributable to Owners of the Bank | 1,042,146 | 982,940 | [Consolidated Statement of Financial Position](index=255&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of December 31, 2019, the Group's total assets were RMB 173.28 billion, total liabilities RMB 157.62 billion, and total equity RMB 15.66 billion 2019 Consolidated Statement of Financial Position Summary | Item (RMB thousand) | December 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | **Assets** | | | | Loans and Advances to Customers | 93,394,198 | 75,354,549 | | Investment Securities and Other Financial Assets | 39,218,160 | 46,453,676 | | **Total Assets** | **173,275,544** | **164,253,276** | | **Liabilities** | | | | Deposits from Customers | 122,840,400 | 109,521,161 | | Debt Securities Issued | 14,220,057 | 20,552,182 | | **Total Liabilities** | **157,615,368** | **149,145,638** | | **Total Equity** | **15,660,176** | **15,107,638** | [Consolidated Statement of Changes in Equity](index=257&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) As of end-2019, equity attributable to owners of the Bank increased to RMB 13.34 billion from RMB 12.96 billion at the beginning of the year - Equity attributable to owners of the Bank increased from **RMB 12.96 billion** at the beginning of the year to **RMB 13.34 billion** at year-end[561](index=561&type=chunk) - Key changes included: an increase of **RMB 1.042 billion** from profit for the year, a decrease of **RMB 717 million** from dividend distribution, and an increase of **RMB 199 million** from capitalization of reserves[561](index=561&type=chunk) [Consolidated Cash Flow Statement](index=259&type=section&id=Consolidated%20Cash%20Flow%20Statement) In 2019, the Group generated a net cash inflow of RMB 7.24 billion from operating activities, a significant improvement from the prior year's net outflow 2019 Consolidated Cash Flow Statement Summary | Item (RMB thousand) | 2019 | 2018 | | :--- | :--- | :--- | | Net Cash from/(used in) Operating Activities | 7,236,044 | (2,450,438) | | Net Cash from Investing Activities | 1,450,464 | 3,429,586 | | Net Cash used in Financing Activities | (7,962,418) | (1,237,757) | | **Net Increase/(Decrease) in Cash and Cash Equivalents** | **724,090** | **(258,609)** | | Cash and Cash Equivalents at Year-end | 16,820,070 | 16,095,980 |