[Important Notice](index=2&type=section&id=Item%20I.%20Important%20Notice) [Report Statement and Basis of Preparation](index=2&type=section&id=1.1-1.5%20Important%20Notice%20Content) The board, supervisory board, and senior management guarantee the report's truthfulness and completeness, approved on October 23, 2020, with unaudited financial statements prepared under Chinese accounting standards - The board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the report content[2](index=2&type=chunk) - The report was approved by the 16th meeting of the Fifth Board of Directors on **October 23, 2020**[2](index=2&type=chunk) - Financial statements are prepared in accordance with **Chinese accounting standards** and are **unaudited**[2](index=2&type=chunk) - Chairman Jin Yu, President Zhu Jian, and Vice President and CFO Shi Hongmin guarantee the truthfulness, accuracy, and completeness of the financial statements[2](index=2&type=chunk) [Company Profile](index=3&type=section&id=Item%20II.%20Company%20Profile) [Key Accounting Data and Financial Indicators](index=3&type=section&id=2.1%20Key%20Accounting%20Data%20and%20Financial%20Indicators) As of September 2020, total assets grew by 9.25% and net assets attributable to parent company shareholders by 5.72%, while January-September operating revenue slightly decreased by 0.91%, net profit fell by 7.99%, and operating cash flow turned positive | Item | Jan-Sep 2020 (RMB in thousands) | Jan-Sep 2019 (RMB in thousands) | YoY Change | | :----------------------------------- | :-------------------------- | :-------------------------- | :------------- | | Operating Revenue | 37,535,511 | 37,881,297 | -0.91% | | Net Profit Attributable to Parent Company Shareholders | 15,051,909 | 16,359,160 | -7.99% | | Net Cash Flow from Operating Activities | 15,168,781 | -12,547,328 | N/A | | Basic Earnings Per Share (RMB/share) | 1.06 | 1.15 | -7.83% | | Annualized Return on Average Assets | 0.86% | 1.04% | down 0.18 percentage points | | Annualized Weighted Average ROE Attributable to Parent Company Common Shareholders | 12.33% | 14.74% | down 2.41 percentage points | | Net Interest Margin | 1.92% | 1.93% | down 0.01 percentage points | | Net Interest Spread | 1.77% | 1.69% | up 0.08 percentage points | | Item | Sep 30, 2020 (RMB in thousands) | Dec 31, 2019 (RMB in thousands) | Change from Prior Year-End | | :----------------------------------- | :------------------------------ | :------------------------------- | :----------- | | Total Assets | 2,443,968,364 | 2,237,081,943 | 9.25% | | Net Assets Attributable to Parent Company Shareholders | 186,815,945 | 176,708,612 | 5.72% | | Net Assets Per Common Share Attributable to Parent Company Common Shareholders (RMB/share) | 11.75 | 11.03 | 6.53% | [Non-recurring Gains and Losses and Amounts](index=4&type=section&id=2.2%20Non-recurring%20Gains%20and%20Losses%20and%20Amounts) From January to September 2020, the company's net non-recurring gains and losses totaled RMB 125,304 thousand, with RMB 122,952 thousand impacting net profit attributable to parent company shareholders, primarily from other net gains and losses | Non-recurring Gains and Losses Item | Jan-Sep 2020 (RMB in thousands) | | :----------------------------------- | :-------------------------- | | Gains or Losses from Disposal of Non-current Assets | -284 | | Other Net Gains and Losses | 169,149 | | Income Tax Impact of Non-recurring Gains and Losses | -43,561 | | Net Amount of Non-recurring Gains and Losses | 125,304 | | Of which: Non-recurring Gains and Losses Affecting Net Profit Attributable to Parent Company Shareholders | 122,952 | | Non-recurring Gains and Losses Affecting Net Profit Attributable to Minority Shareholders | 2,352 | [Common Shareholder Information](index=4&type=section&id=2.3%20Common%20Shareholder%20Information) As of the end of the reporting period, the company had 128,528 common shareholders, with the top ten remaining stable, led by Shanghai United Investment Co., Ltd. at 14.68%, and some foreign corporate shareholders holding shares via Hong Kong Securities Clearing Company Limited - Total common shareholders at period-end were **128,528 accounts**[6](index=6&type=chunk) | Shareholder Name | Shares Held at Period-End (shares) | Percentage | | :----------------------------------- | :------------------ | :--- | | Shanghai United Investment Co., Ltd. | 2,085,100,328 | 14.68% | | Shanghai International Port Group Co., Ltd. | 1,178,744,443 | 8.30% | | Banco Santander, S.A. | 929,137,290 | 6.54% | | TCL Technology Group Corporation | 792,386,855 | 5.58% | | China Jianyin Investment Ltd. | 687,322,763 | 4.84% | | China Shipbuilding Trading Co., Ltd. | 579,764,799 | 4.08% | | Ping An Life Insurance Company of China, Ltd. – Universal – Individual Universal | 495,270,716 | 3.49% | | Shanghai Commercial Bank Limited | 426,211,240 | 3.00% | | HKSCC Nominees Limited | 339,307,668 | 2.39% | | Shanghai Jing'an District Finance Bureau | 290,856,868 | 2.05% | - The top ten shareholders list remained consistent with the beginning of the period, with some changes due to share increases or decreases[8](index=8&type=chunk) [Preferred Shareholder Information](index=5&type=section&id=2.4%20Preferred%20Shareholder%20Information) At period-end, the company had 24 preferred shareholders, with Jiangsu Bank Co., Ltd. - Jubao Wealth Caiyirong holding the largest stake at 15.25%, and the company preliminarily identified potential related party relationships among some preferred shareholders or with common shareholders - Total preferred shareholders at period-end were **24 accounts**[9](index=9&type=chunk) | Shareholder Name | Shares Held at Period-End (shares) | Percentage | | :----------------------------------- | :------------------ | :--- | | Jiangsu Bank Co., Ltd. – Jubao Wealth Caiyirong | 30,500,000 | 15.25% | | China Post & Capital Fund Management Co., Ltd. – Huaxia Bank – Huaxia Bank Co., Ltd. | 20,000,000 | 10.00% | | CICC Fund Management Co., Ltd. – China Merchants Bank – China Merchants Bank Co., Ltd. | 20,000,000 | 10.00% | | Changjiang Pension Insurance Co., Ltd. – Bank of China – China Pacific Life Insurance Co., Ltd. | 15,000,000 | 7.50% | | BOCOM Schroders Asset Management Co., Ltd. – Bank of Communications – BOCOM Schroders Asset Management Zhuoyuan No. 2 Collective Asset Management Plan | 15,000,000 | 7.50% | | Bank of Tianjin Co., Ltd. – Gangwan Wealth Closed Net Value Series Wealth Management Product | 14,980,000 | 7.49% | | Postal Savings Bank of China Co., Ltd. | 10,000,000 | 5.00% | | Ping An Life Insurance Company of China, Ltd. – Universal – Individual Universal | 10,000,000 | 5.00% | | Ping An Life Insurance Company of China, Ltd. – Participating – Individual Participating | 10,000,000 | 5.00% | | CCB Trust Co., Ltd. – Hengxin Antai Bond Investment Collective Fund Trust Plan | 10,000,000 | 5.00% | | Jiangsu International Trust Co., Ltd. – Jiangsu Trust MinSheng Wealth Single Fund Trust | 10,000,000 | 5.00% | - Based on public information, the company preliminarily determined that some preferred shareholders have **related party relationships**, such as Jiangsu Bank Co., Ltd. - Jubao Wealth Caiyirong and Jiangsu International Trust Co., Ltd. - Jiangsu Trust MinSheng Wealth Single Fund Trust[10](index=10&type=chunk) [Capital Adequacy Ratio](index=6&type=section&id=2.5%20Capital%20Adequacy%20Ratio) As of September 30, 2020, the Group's capital adequacy ratios remained robust and compliant, with Common Equity Tier 1 at 9.53%, Tier 1 at 10.71%, and total capital adequacy at 13.17%, all exceeding minimum regulatory requirements | Item | Sep 30, 2020 (Consolidated) | Dec 31, 2019 (Consolidated) | | :------------------- | :------------------------ | :------------------------- | | Common Equity Tier 1 Capital Adequacy Ratio | 9.53% | 9.66% | | Tier 1 Capital Adequacy Ratio | 10.71% | 10.92% | | Capital Adequacy Ratio | 13.17% | 13.84% | - Calculated according to the 'Measures for the Capital Management of Commercial Banks (Trial)', all capital adequacy ratios exceed the minimum regulatory requirements (**Common Equity Tier 1 5%**, **Tier 1 6%**, **Total Capital 8%**, **Capital Conservation Buffer 2.5%**)[11](index=11&type=chunk) [Leverage Ratio](index=7&type=section&id=2.6%20Leverage%20Ratio) As of September 30, 2020, the Group's leverage ratio was 6.69%, consistent with June 2020 but slightly lower than year-end 2019 | Item | Sep 30, 2020 | Dec 31, 2019 | | :------------------- | :----------------- | :------------------ | | Leverage Ratio | 6.69% | 6.92% | [Liquidity Coverage Ratio](index=7&type=section&id=2.7%20Liquidity%20Coverage%20Ratio) As of September 30, 2020, the Group's liquidity coverage ratio was 168.80%, a decrease from 178.25% at June 2020 but still maintained at a high level | Item | Sep 30, 2020 | Jun 30, 2020 | | :------------------- | :----------------- | :----------------- | | Liquidity Coverage Ratio | 168.80% | 178.25% | [Asset Quality](index=7&type=section&id=2.8%20Asset%20Quality) As of September 30, 2020, the Group's non-performing loan ratio was 1.22%, slightly up from year-end but remaining low and stable, with a high provision coverage ratio of 328.07% and loan loss provision ratio of 4.00%, indicating ample risk absorption capacity | Item | Sep 30, 2020 | Dec 31, 2019 | | :------------------- | :----------------- | :------------------ | | Non-performing Loan Ratio | 1.22% | 1.16% | | Provision Coverage Ratio | 328.07% | 337.15% | | Loan Loss Provision Ratio | 4.00% | 3.98% | - The non-performing loan ratio slightly increased from the prior year-end, but the fluctuation remained within a reasonable and controllable range, maintaining a **low and stable level**[14](index=14&type=chunk) - Both the overdue-to-NPL ratio and overdue loan ratio decreased from June-end, falling by **34 percentage points** and **0.35 percentage points**, respectively[18](index=18&type=chunk) [Discussion and Analysis of Operations](index=8&type=section&id=2.9%20Discussion%20and%20Analysis%20of%20Operations) From January to September 2020, Shanghai Bank actively responded to external economic conditions, served the real economy, promoted business transformation, strengthened risk control, achieved steady business growth, stable asset quality, and enhanced corporate and retail services through digital transformation, with rapid development in internet finance - The Group strengthened its analysis and response to external economic and financial conditions, seized opportunities in market trends, actively responded to national macroeconomic policy guidance, and **proactively served the real economy**[15](index=15&type=chunk) - Continuously promoted business transformation and structural adjustment, deepened specialized operations, strengthened risk prevention and non-performing asset resolution, and fully advanced the conclusion of this three-year plan[15](index=15&type=chunk) [Steady Business Growth, Increased Fee Reductions, and Positive Interaction with the Real Economy](index=8&type=section&id=%28%E4%B8%80%29%20%E5%90%84%E9%A1%B9%E4%B8%9A%E5%8A%A1%E7%A8%B3%E6%AD%A5%E5%A2%9E%E9%95%BF%EF%BC%8C%E5%8A%A0%E5%A4%A7%E5%87%8F%E8%B4%B9%E8%AE%A9%E5%88%A9%EF%BC%8C%E5%AE%9E%E7%8E%B0%E4%B8%8E%E5%AE%9E%E4%BD%93%E7%BB%8F%E6%B5%8E%E8%89%AF%E6%80%A7%E4%BA%92%E5%8A%A8) As of September 2020, the Group's total assets reached **RMB 2,443.97 billion**, up 9.25% from year-end, with customer loans and advances growing by 9.69% and deposits by 10.06%, optimizing the asset-liability structure and increasing credit to key areas like inclusive and supply chain finance - Total assets reached **RMB 2,443.97 billion**, an increase of **9.25%** from the prior year-end[16](index=16&type=chunk) - Total customer loans and advances were **RMB 1,066.74 billion**, up **9.69%** from the prior year-end, accounting for **43.65%** of total assets[16](index=16&type=chunk) - Total deposits were **RMB 1,305.38 billion**, up **10.06%** from the prior year-end, accounting for **57.85%** of total liabilities[16](index=16&type=chunk) - Increased credit support to key areas, with rapid growth in inclusive finance, supply chain finance, and livelihood finance loans, further **optimizing the credit structure**[16](index=16&type=chunk) [Overall Stable Operating Performance, Enhanced Risk Response, and Proactive Increase in Provisioning](index=8&type=section&id=%28%E4%BA%8C%29%20%E7%BB%8F%E8%90%A5%E4%B8%9A%E7%BB%A9%E6%80%BB%E4%BD%93%E7%A8%B3%E5%81%A5%EF%BC%8C%E5%8A%A0%E5%BC%BA%E9%A3%8E%E9%99%A9%E5%BD%A2%E5%8A%BF%E5%BA%94%E5%AF%B9%EF%BC%8C%E4%B8%BB%E5%8A%A8%E5%8A%A0%E5%A4%A7%E6%8B%A8%E5%A4%87%E8%AE%A1%E6%8F%90%E5%8A%9B%E5%BA%A6) From January to September 2020, the Group's operating revenue was **RMB 37.54 billion**, a slight decrease of 0.91% year-over-year; net interest income grew by 18.50%, with net interest margin widening by 0.08 percentage points; net profit attributable to parent company shareholders fell by 7.99% to **RMB 15.05 billion**, primarily due to a proactive 19.84% increase in provisions | Indicator | Jan-Sep 2020 | Jan-Sep 2019 | YoY Change | | :------------------- | :------------- | :------------- | :------- | | Operating Revenue | 37.54 billion RMB | 37.88 billion RMB | -0.91% | | Net Interest Income | up 4.07 billion RMB | - | +18.50% | | Net Interest Spread | 1.77% | 1.69% | up 0.08 percentage points | | Net Fee and Commission Income | up 0.36 billion RMB | - | +7.32% | | Net Profit Attributable to Parent Company Shareholders | 15.05 billion RMB | 16.36 billion RMB | -7.99% | | Provisioning Amount | up 19.84% | - | +19.84% | - Total other income decreased by **RMB 4.78 billion** year-over-year, mainly due to a decrease in fair value measured financial assets, declining market interest rates, and exchange rate fluctuations impacting valuation net gains/losses[17](index=17&type=chunk) [Stable Asset Quality, Ample Risk Provisions and Capital Levels](index=8&type=section&id=%28%E4%B8%89%29%20%E8%B5%84%E4%BA%A7%E8%B4%A8%E9%87%8F%E7%A8%B3%E5%AE%9A%E8%BF%90%E8%A1%8C%EF%BC%8C%E9%A3%8E%E9%99%A9%E6%8B%A8%E5%A4%87%E5%92%8C%E5%90%84%E7%BA%A7%E8%B5%84%E6%9C%AC%E6%B0%B4%E5%B9%B3%E5%85%85%E8%B6%B3) The Group's asset quality is stable and controllable, with a non-performing loan ratio of 1.22%, slightly up from year-end but remaining low; provision coverage ratio is 328.07% and loan loss provision ratio is 4.00%, indicating ample risk absorption capacity, while capital adequacy, Tier 1, and Common Equity Tier 1 ratios remain compliant and robust - Non-performing loan ratio was **1.22%**, slightly increased from the prior year-end, but remained within a reasonable and controllable range, maintaining a **low and stable level**[18](index=18&type=chunk) - Provision coverage ratio was **328.07%**, and loan loss provision ratio was **4.00%**, both maintained at a **high level**[18](index=18&type=chunk) - Capital adequacy ratio was **13.17%**, Tier 1 capital adequacy ratio **10.71%**, and Common Equity Tier 1 capital adequacy ratio **9.53%**, demonstrating **compliant and robust capital levels**[18](index=18&type=chunk) - Continuously strengthened risk management for large credit exposures, key regions, sectors, and clients, curbing new risk exposure, and **intensified efforts in non-performing asset resolution**[18](index=18&type=chunk) [Rooted in Regional Markets, Digital Transformation Enhances Corporate Business Service to the Real Economy](index=9&type=section&id=%28%E5%9B%9B%29%20%E6%89%8E%E6%A0%B9%E5%8C%BA%E5%9F%9F%E5%B8%82%E5%9C%BA%EF%BC%8C%E4%BB%A5%E6%95%B0%E5%AD%97%E5%8C%96%E8%BD%AC%E5%9E%8B%E6%8F%90%E5%8D%87%E5%85%AC%E5%8F%B8%E4%B8%9A%E5%8A%A1%E6%9C%8D%E5%8A%A1%E5%AE%9E%E4%BD%93%E7%BB%8F%E6%B5%8E%E8%83%BD%E7%BA%A7) The company deepened its presence in key regions like the Yangtze River Delta, enhancing corporate services to the real economy through digital transformation, with inclusive finance loan disbursements up 136.95%, supply chain finance credit support up 37.68%, and tech-enterprise loan balances up 6.12%; it actively participated in urban construction, with livelihood finance loan balances up 71.37% and debt financing instrument underwriting up 55.92% - Corporate customers totaled **233.6 thousand accounts**, an increase of **8.4 thousand accounts** from the prior year-end[19](index=19&type=chunk) - Inclusive finance loan disbursements amounted to **RMB 36.55 billion**, a year-over-year increase of **136.95%**; loan balance was **RMB 42.12 billion**, up **77.50%** from the prior year-end[19](index=19&type=chunk) - Supply chain finance credit support balance was **RMB 40.50 billion**, an increase of **37.68%** from the prior year-end[19](index=19&type=chunk) - Loans to technology-based enterprises totaled **RMB 90.03 billion**, up **6.12%** from the prior year-end[19](index=19&type=chunk) - Livelihood finance loan balance was **RMB 49.96 billion**, an increase of **71.37%** from the prior year-end[20](index=20&type=chunk) - Debt financing instrument underwriting volume was **RMB 141.29 billion**, a year-over-year increase of **55.92%**[20](index=20&type=chunk) [Technology Empowerment Drives High-Quality Development of Retail Business](index=9&type=section&id=%28%E4%BA%94%29%20%E5%9B%B4%E7%BB%95%E2%80%9C%E9%87%8D%E4%B8%AD%E4%B9%8B%E9%87%8D%E2%80%9D%E6%88%98%E7%95%A5%E5%AE%9A%E4%BD%8D%EF%BC%8C%E7%A7%91%E6%8A%80%E8%B5%8B%E8%83%BD%E9%A9%B1%E5%8A%A8%E9%9B%B6%E5%94%AE%E4%B8%9A%E5%8A%A1%E9%AB%98%E8%B4%A8%E9%87%8F%E5%8F%91%E5%B1%95) Retail business, a strategic priority, achieved high-quality development through technology empowerment, with personal loans and advances growing by 2.80%, including a 20.41% increase in housing mortgage loans; retail customer numbers rose by 9.61%, AUM by 13.93%, and wealth customers (AUM ≥ RMB 1 million) by 20.13%; cumulative credit card issuance exceeded **10 million**, up 16.04% - Personal loans and advances balance was **RMB 329.84 billion**, an increase of **2.80%** from the prior year-end[22](index=22&type=chunk) - Housing mortgage loan balance was **RMB 113.67 billion**, an increase of **20.41%** from the prior year-end[22](index=22&type=chunk) - Retail customer accounts totaled **17.65 million**, an increase of **9.61%** from the prior year-end[22](index=22&type=chunk) - Assets Under Management (AUM) for retail customers reached **RMB 724.49 billion**, an increase of **13.93%** from the prior year-end[22](index=22&type=chunk) - Wealth customers with average daily AUM of **RMB 1 million or more** totaled **144.4 thousand accounts**, an increase of **20.13%** from the prior year-end[22](index=22&type=chunk) - Cumulative credit card issuance reached **10.41 million cards**, an increase of **16.04%** from the prior year-end, achieving the strategic goal of a 'ten-million-card issuer' ahead of schedule[23](index=23&type=chunk) [Continuous Product and Service Innovation, Rapid Development of Internet Finance Business](index=10&type=section&id=%28%E5%85%AD%29%20%E6%8C%81%E7%BB%AD%E5%88%9B%E6%96%B0%E4%BA%A7%E5%93%81%E4%B8%8E%E6%9C%8D%E5%8A%A1%EF%BC%8C%E4%BA%92%E8%81%94%E7%BD%91%E9%87%91%E8%9E%8D%E4%B8%9A%E5%8A%A1%E4%BF%9D%E6%8C%81%E5%BF%AB%E9%80%9F%E5%8F%91%E5%B1%95) The company's internet finance business achieved rapid growth through product innovation and an open banking model, with online individual customers up 24.60% and annual active customers up 54.03%; average daily internet deposit balances increased by 51.73%, internet SME loan balances by 79.99%, internet fee and commission income by 37.87%, and mobile banking app monthly active users by 16.85% - Online individual customer accounts totaled **37.39 million**, an increase of **24.60%** from the prior year-end[25](index=25&type=chunk) - Annual active customer accounts reached **7.17 million**, a year-over-year increase of **54.03%**[25](index=25&type=chunk) - Average daily internet business deposit balance was **RMB 47.71 billion**, an increase of **51.73%** from the prior year's average daily balance[25](index=25&type=chunk) - Internet SME loan balance was **RMB 17.65 billion**, an increase of **79.99%** from the prior year-end[25](index=25&type=chunk) - Internet fee and commission income was **RMB 1.11 billion**, a year-over-year increase of **37.87%**[25](index=25&type=chunk) - Mobile banking app monthly active users reached **2.15 million**, an increase of **16.85%** from the prior year-end[25](index=25&type=chunk) [Significant Matters](index=12&type=section&id=Item%20III.%20Significant%20Matters) [Significant Changes and Reasons for Key Financial Statement Items and Indicators](index=12&type=section&id=3.1%20Significant%20Changes%20and%20Reasons%20for%20Key%20Financial%20Statement%20Items%20and%20Indicators) During the reporting period, several financial statement items experienced significant changes; derivative financial assets and liabilities increased due to exchange rate fluctuations, while other assets and liabilities rose due to pending settlements; trading financial liabilities sharply decreased due to reduced short selling, and net gains from fair value changes and exchange gains turned into losses, mainly impacted by declining equity instrument valuations and market interest and exchange rate fluctuations | Item | Sep 30, 2020 (RMB in thousands) | Dec 31, 2019 (RMB in thousands) | Change from Prior Year-End | Primary Reason for Change | | :------------------- | :-------------------------- | :-------------------------- | :----------- | :------------- | | Derivative Financial Assets | 24,670,581 | 16,443,915 | 50.03% | Valuation of foreign exchange derivative financial instruments affected by exchange rate fluctuations | | Other Assets | 30,138,943 | 14,024,086 | 114.91% | Increase in pending settlement items | | Trading Financial Liabilities | 20 | 400,427 | -100.00% | Decrease in short selling activities | | Derivative Financial Liabilities | 26,096,300 | 16,690,672 | 56.35% | Valuation of foreign exchange derivative financial instruments affected by exchange rate fluctuations | | Other Liabilities | 8,110,512 | 6,117,750 | 32.58% | Increase in pending settlement items | | Item | Jan-Sep 2020 (RMB in thousands) | Jan-Sep 2019 (RMB in thousands) | YoY Change | Primary Reason for Change | | :------------------- | :-------------------------- | :-------------------------- | :----------- | :------------- | | Net Gains/(Losses) from Fair Value Changes | -54,267 | 1,945,908 | -102.79% | Valuation of equity instruments affected by scale reduction and market interest rate fluctuations | | Net Gains/(Losses) from Exchange | -522,549 | 233,804 | -323.50% | Valuation of foreign exchange derivative financial instruments affected by exchange rate fluctuations | | Other Operating Income | 41,241 | 94,698 | -56.45% | Decrease in other operating income | | Income Tax Expense | -918,294 | -2,039,902 | -54.98% | Decrease in taxable income | | Minority Interest | 24,849 | 36,954 | -32.76% | Decrease in subsidiary profits | [Progress of Significant Matters](index=12&type=section&id=3.2%20Important%20Matters%20Progress%20and%20Analysis%20of%20Their%20Impact%20and%20Solutions) The company's application for public issuance of convertible corporate bonds is progressing, with a public disclosure of its response to the China Securities Regulatory Commission's feedback on July 18, 2020, though the plan still requires regulatory approval - The company's application for public issuance of convertible corporate bonds has received feedback from the **China Securities Regulatory Commission (CSRC)**, and the response has been publicly disclosed[28](index=28&type=chunk) - This issuance plan still requires approval from the **CSRC** and other regulatory bodies before implementation[28](index=28&type=chunk) [Overdue Unfulfilled Commitments](index=12&type=section&id=3.3%20Overdue%20Unfulfilled%20Commitments%20During%20the%20Reporting%20Period) During the reporting period, the company had no overdue unfulfilled commitments - There were **no overdue unfulfilled commitments** during the reporting period[28](index=28&type=chunk) [Warning of Significant Changes in Cumulative Net Profit](index=13&type=section&id=3.4%20Warning%20and%20Explanation%20of%20Potential%20Loss%20or%20Significant%20Change%20in%20Cumulative%20Net%20Profit%20from%20Year-Beginning%20to%20the%20End%20of%20the%20Next%20Reporting%20Period) The company has not issued any warning or explanation regarding potential losses or significant changes in cumulative net profit from the beginning of the year to the end of the next reporting period, indicating no such major risk is currently anticipated - The company has **not issued any warning** regarding potential losses or significant changes in cumulative net profit[29](index=29&type=chunk) [Changes in Accounting Policies](index=13&type=section&id=3.5%20Explanation%20of%20Changes%20in%20Accounting%20Policies) Effective January 1, 2020, the company adopted the revised 'Enterprise Accounting Standard No. 14 – Revenue,' a change approved and disclosed by the board, which has no significant impact on the company's revenue recognition methods or financial statements - The company adopted the revised **'Enterprise Accounting Standard No. 14 – Revenue'** effective **January 1, 2020**[30](index=30&type=chunk) - The change in accounting policy did not significantly alter the company's revenue recognition methods and had **no material impact** on the financial statements[30](index=30&type=chunk) [Appendix: Financial Statements Prepared Under Chinese Accounting Standards](index=14&type=section&id=Item%20IV.%20Appendix%20Financial%20Statements%20Prepared%20Under%20Chinese%20Accounting%20Standards) [Consolidated and Bank Balance Sheets](index=14&type=section&id=%E5%90%88%E5%B9%B6%E5%8F%8A%E9%93%B6%E8%A1%8C%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E8%A1%A8) This section presents the consolidated and bank balance sheets as of September 30, 2020, and December 31, 2019, detailing the composition and period-end balances of assets, liabilities, and shareholders' equity Consolidated Balance Sheet (Excerpt) | Item | Sep 30, 2020 (RMB in thousands) | Dec 31, 2019 (RMB in thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Total Assets | 2,443,968,364 | 2,237,081,943 | | Total Liabilities | 2,256,616,250 | 2,059,855,312 | | Total Equity Attributable to Parent Company Shareholders | 186,815,945 | 176,708,612 | [Consolidated and Bank Income Statements](index=17&type=section&id=%E5%90%88%E5%B9%B6%E5%8F%8A%E9%93%B6%E8%A1%8C%E5%88%A9%E6%B6%A6%E8%A1%A8) This section presents the consolidated and bank income statements for January-September 2020 and 2019, covering key financial performance indicators such as operating income, operating expenses, total profit, and net profit Consolidated Income Statement (Excerpt) | Item | Jan-Sep 2020 (RMB in thousands) | Jan-Sep 2019 (RMB in thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Operating Revenue | 37,535,511 | 37,881,297 | | Operating Profit | 15,885,945 | 18,296,855 | | Total Profit | 15,995,052 | 18,436,016 | | Net Profit | 15,076,758 | 16,396,114 | | Net Profit Attributable to Parent Company Shareholders | 15,051,909 | 16,359,160 | | Basic and Diluted Earnings Per Share (RMB) | 1.06 | 1.15 | [Consolidated and Bank Cash Flow Statements](index=19&type=section&id=%E5%90%88%E5%B9%B6%E5%8F%8A%E9%93%B6%E8%A1%8C%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) This section provides the consolidated and bank cash flow statements for January-September 2020 and 2019, detailing net cash flows from operating, investing, and financing activities, as well as period-end balances of cash and cash equivalents Consolidated Cash Flow Statement (Excerpt) | Item | Jan-Sep 2020 (RMB in thousands) | Jan-Sep 2019 (RMB in thousands) | | :----------------------------------- | :-------------------------- | :-------------------------- | | Net Cash Flow from Operating Activities | 15,168,781 | -12,547,328 | | Net Cash Flow from Investing Activities | -17,047,660 | -11,507,678 | | Net Cash Flow from Financing Activities | 11,263,222 | -7,630,024 | | Net Increase/(Decrease) in Cash and Cash Equivalents | 9,151,980 | -31,251,430 | | Cash and Cash Equivalents at Period-End | 56,460,993 | 54,150,335 |

Financial Performance - In 2019, Shanghai Bank achieved a net profit growth, with operating income and net profit continuing to grow rapidly, while maintaining stable asset quality[5]. - In 2019, the company achieved an operating income of 49.8 billion yuan, a year-on-year increase of 13.47%[13]. - Net profit attributable to shareholders exceeded 20 billion yuan, with a year-on-year growth of 12.55%[13]. - Total assets reached 2.24 trillion yuan, with loan and deposit balances increasing by 13.77% and 14.32% respectively compared to the previous year[13]. - The company reported a total cash dividend distribution of 5,682,611.48 thousand yuan, with a dividend of 4.00 yuan per 10 shares[2]. - Net interest income for 2019 reached RMB 30,320,609 thousand, a 1.28% increase from RMB 29,936,829 thousand in 2018[40]. - Total operating income was RMB 49,800,292 thousand, reflecting a 13.47% growth compared to RMB 43,887,822 thousand in 2018[40]. - The net profit attributable to shareholders for the year 2019 was CNY 20.30 billion, representing a year-on-year growth of 12.55%[50]. - The total assets of the company as of December 31, 2019, amounted to CNY 2,237.08 billion, reflecting a growth of 10.32% year-on-year[51]. - The capital adequacy ratio improved to 13.84%, up from 13.00% in 2018[43]. Retail and Consumer Finance - Retail financial business revenue proportion increased by 3.65 percentage points year-on-year, reflecting a focus on consumer finance and wealth management[6]. - Retail financial services revenue grew by 30.45% year-on-year, contributing significantly to overall income[13]. - The number of new pension customers grew by 15.84%, reaching a five-year high in new customer acquisition[8]. - Credit card issuance increased by 23.92% compared to the end of the previous year, demonstrating effective customer acquisition strategies[8]. - The retail financial services have seen a continuous optimization of business structure, with the core customer base and customer assets growing at the highest rate in four years, particularly in the wealth management sector[31]. - The retail customer base reached 15.57 million, an increase of 8.89% year-over-year[175]. - Comprehensive assets under management (AUM) for retail customers totaled 635.92 billion yuan, up 22.38% from the previous year[175]. - The total number of credit cards issued reached 8.9755 million, an increase of 23.92% compared to the previous year[188]. - Wealth management clients with average assets of 1 million yuan or more increased by 37.84% to 120,211 households[182]. Digital Transformation and Technology - The company is focusing on digital transformation, enhancing operational efficiency through technologies like RPA, OCR, and facial recognition[10]. - The company aims to build a digital open financial platform to improve customer experience and provide inclusive financial services[10]. - The company emphasizes the integration of technology and finance, planning to deepen the application of AI, big data, and blockchain in its operations[19]. - The company is enhancing its digital transformation capabilities, with increased investment in technology resources and deepening applications of AI and big data in customer marketing and risk control[32]. - The company launched a mobile banking platform that achieved a customer base of 5.7242 million, a growth of 29.15% year-on-year, with mobile banking product sales accounting for 63.62% of total sales, an increase of 13.23 percentage points[200]. - The company implemented a distributed architecture for its retail loan core system, supporting high concurrency and large transaction volumes in online retail loan business[198]. - The company is focusing on digital marketing strategies based on customer segmentation insights to improve online customer acquisition and engagement[194]. - The company invested CNY 1.433 billion in information technology during the reporting period, a year-on-year increase of 36.91%, accounting for 2.95% of total revenue[196]. Risk Management and Asset Quality - The risk management system was enhanced with a focus on maintaining asset quality and compliance, achieving an excellent level compared to peers[9]. - The non-performing loan ratio stood at 1.16%, slightly up from 1.14% in 2018[43]. - The overall asset quality remained stable, with the company enhancing risk management and credit structure optimization[99]. - The company has strengthened risk management and control measures to ensure that credit risks remain within a controllable range[112]. - The provision coverage ratio improved to 337.15%, an increase of 4.20 percentage points year-on-year[100]. - The non-performing loan ratio for personal loans was 0.88%, slightly up due to the rapid growth of consumer credit products in 2018[175]. Strategic Initiatives and National Development - The company emphasized the importance of aligning with national development strategies, such as the Yangtze River Delta integration and the Free Trade Zone[6]. - The company invested over 60 billion yuan in supporting national strategies such as the Yangtze River Delta integration and the Guangdong-Hong Kong-Macau Greater Bay Area[14]. - The bank is actively supporting small and micro enterprises and key national strategies, increasing credit resources to these sectors[27]. - The company continues to focus on supporting regional economic development and major national strategic plans, including the Belt and Road Initiative and the Greater Bay Area[110]. Awards and Recognition - The company has received multiple awards in 2019, including recognition for excellence in wealth management and risk control, highlighting its competitive position in the market[39]. - The company received multiple awards, including the "2019 Annual Innovative Credit Card Brand" from Huaxia Times[188].

Financial Performance - Net profit attributable to shareholders of the parent company for the first three quarters was RMB 14,276,443 thousand, up 22.46% year-on-year[6] - Operating income for the first three quarters was RMB 31,629,713 thousand, representing a growth of 29.48% compared to the same period last year[6] - Basic earnings per share increased to RMB 1.31, a rise of 22.43% from RMB 1.07 in the previous year[6] - Net profit attributable to shareholders reached RMB 14.28 billion, growing by 22.46% year-on-year[25] - The net profit attributable to shareholders of the parent company was RMB 14,276,443 thousand, representing a 22.5% increase from RMB 11,657,574 thousand in the same period of 2017[45] Asset and Liability Management - Total assets reached RMB 1,958,328,269 thousand, an increase of 8.33% compared to the end of last year[6] - Total assets amounted to RMB 1,958.33 billion, an increase of 8.33% compared to the end of the previous year[27] - The total liabilities amounted to approximately 1.80 trillion RMB, reflecting a significant increase from the previous year[40] - Total deposits exceeded RMB 1 trillion, reaching RMB 1,012.10 billion, up 9.58% from the previous year[27] - Customer loans and advances totaled RMB 831.48 billion, reflecting a growth of 25.22% year-on-year[27] Return on Investment - The annualized average return on assets improved to 1.01%, up 0.13 percentage points from the previous year[6] - The annualized weighted average return on equity increased to 14.30%, up 1.40 percentage points year-on-year[6] Shareholder Information - The total number of common shareholders at the end of the reporting period was 140,023[11] - The largest shareholder, Shanghai Lianhe Investment Co., Ltd., held 1,457,856,354 shares, accounting for 13.34% of total shares[11] - The total equity attributable to shareholders of the parent company reached RMB 157,918,666 thousand, up from RMB 146,985,136 thousand at the end of 2017, marking a growth of 7.9%[42] Non-Performing Loans and Provisions - The non-performing loan ratio improved to 1.08%, down from 1.15% at the end of the previous year[24] - The provision coverage ratio improved to 321.14%, an increase of 48.62 percentage points year-on-year[32] - The increase in asset impairment losses was 49.11%, amounting to 9.64 billion RMB due to increased loan provisions[36] Cash Flow Analysis - The net cash flow from operating activities was reported at -81,803,063 thousand, showing an improvement from -86,613,578 thousand in the previous year[6] - The bank reported a net increase in cash flow from operating activities of RMB 194,683,964 thousand, compared to RMB 107,672,435 thousand in the same period of 2017[47] - Cash outflow from operating activities totaled (276,487,027) in Q3 2018, up from (194,286,013) in Q2 2018[48] - Cash inflow from investment activities was 512,742,871 in Q3 2018, compared to 716,929,188 in Q2 2018[49] - Cash inflow from financing activities amounted to 695,074,079 in Q3 2018, compared to 385,346,958 in Q2 2018[49] Customer Growth and Engagement - The number of online personal customers reached 17.41 million, an increase of 35.31% compared to the end of the previous year[30] - Internet wealth management sales amounted to 22.77 billion RMB, representing a year-on-year growth of 74.57%[30] - Retail customer comprehensive assets (AUM) reached RMB 493.19 billion, increasing by 14.75% year-on-year[29] - The company’s pension client comprehensive assets grew to RMB 214.68 billion, a year-on-year increase of 17.14%[29] - The balance of loans to technology enterprises was RMB 63.33 billion, up 32.60% from the previous year[28] Operating Expenses - The bank's operating expenses totaled RMB 16,381,296 thousand, an increase of 31.1% from RMB 12,493,673 thousand year-on-year[44]

Financial Performance - The operating income for the first half of 2018 was RMB 19,749,818 thousand, representing a 28.28% increase compared to RMB 15,396,008 thousand in the same period of 2017[14]. - The net profit attributable to shareholders of the parent company reached RMB 9,371,747 thousand, a growth of 20.21% from RMB 7,795,857 thousand in the first half of 2017[14]. - The net interest income for the first half of 2018 was RMB 12,764,512 thousand, an increase of 38.66% compared to RMB 9,205,299 thousand in the same period of 2017[15]. - The basic earnings per share for the first half of 2018 was RMB 0.86, representing a 21.13% increase from RMB 0.71 in the first half of 2017[15]. - The company reported non-recurring gains of RMB 60,617,000 in H1 2018, after tax impacts[19]. - The company's operating revenue reached RMB 19.75 billion, a year-on-year increase of 28.28%, while net profit attributable to shareholders was RMB 9.37 billion, up 20.21%[33]. Asset and Liability Management - The total assets as of June 30, 2018, amounted to RMB 1,918,725,038 thousand, reflecting a 6.14% increase from RMB 1,807,766,938 thousand at the end of 2017[15]. - The total liabilities were RMB 1,765,547,321 thousand, up 6.34% from RMB 1,660,325,535 thousand at the end of 2017[15]. - The total deposits reached RMB 990,639,633 thousand, which is a 7.26% increase from RMB 923,585,324 thousand at the end of 2017[15]. - Customer loans and advances totaled RMB 780,322,052 thousand, marking a 17.51% increase from RMB 664,021,617 thousand at the end of 2017[15]. - The total assets of the group reached RMB 1,918.73 billion, an increase of RMB 111.96 billion or 6.14% compared to the end of the previous year[58]. - The total amount of loans and advances was RMB 780.32 billion, representing 40.67% of total assets, up from 36.73% at the end of the previous year[61]. Risk Management - The company has established a "three lines of defense" risk management system, enhancing risk management capabilities across credit, market, operational, liquidity, legal, reputation, strategic, and information technology risks[166]. - The company has improved asset quality through targeted risk management and a specialized mechanism for non-performing asset recovery, leading to a continuous improvement in asset quality[167]. - The company has implemented a unified risk management framework for subsidiaries, enhancing the overall risk management capabilities at the group level[168]. - The company has optimized credit risk management by establishing a unified credit policy and enhancing monitoring and early warning systems for credit risks[169]. - The company has established a comprehensive risk management system that covers all categories and areas of risk management, ensuring full coverage of risk management processes[166]. Capital Adequacy and Liquidity - The capital adequacy ratio stood at 13.44%, with the core tier 1 capital ratio at 10.07%, indicating a strong capital position to support business growth[39]. - The liquidity coverage ratio stood at 134.66% as of June 30, 2018, exceeding the regulatory requirement of 100%[20]. - The liquidity coverage ratio at the end of the reporting period was 134.66%, with qualified liquid assets amounting to RMB 197,803,772.40 and net cash outflows over the next 30 days at RMB 146,895,027.80[177]. Customer Growth and Engagement - The number of online personal customers reached 15.11 million, a growth of 17.44%, with internet consumer loan balance increasing by 132.61% to RMB 69.31 billion[37]. - The bank's customer base grew by 2.46% compared to the end of the previous year, indicating a sustainable development in company business[130]. - The total number of bank cards issued reached 16.59 million, a growth of 7.00% compared to the previous year, with card consumption amounting to CNY 108.57 billion, up 23.53% year-on-year[143]. Governance and Compliance - The company has strengthened its governance mechanisms and improved information disclosure management during the reporting period[190]. - The company is focused on compliance with relevant laws and regulations, enhancing investor relations management[190]. - The company has implemented a rigorous governance structure to ensure diligent and compliant operations[190]. - The company held the 2017 annual general meeting on June 22, 2018, where 13 proposals were approved, including the financial budget for 2018[191]. Operational Efficiency - The cost-to-income ratio improved to 20.26% in H1 2018, down from 24.13% in H1 2017, a decrease of 3.87 percentage points[17]. - Business and management expenses rose by 7.72% to RMB 4,002.08 million, mainly due to increased employee costs and administrative expenses[55]. - The company launched a fully online personal consumption loan service, significantly reducing processing time to seconds and handling peak transactions exceeding 500,000 daily[150].