BOC HONG KONG(02388)2024-03-28 08:31Financial Performance - The net operating income before impairment provisions for 2023 was HKD 65,498 million, an increase of 20.8% from HKD 54,215 million in 2022[4]. - Operating profit for 2023 reached HKD 42,558 million, up 22.0% compared to HKD 34,917 million in 2022[4]. - The annual profit attributable to shareholders was HKD 34,115 million, representing a 24.9% increase from HKD 27,330 million in 2022[4]. - The basic earnings per share for 2023 was HKD 3.0950, compared to HKD 2.4535 in 2022, reflecting a growth of 26.2%[4]. - The net profit after tax for the year was HKD 34,857 million, representing a 28.0% year-on-year increase[8]. - The annual profit reached HKD 34.86 billion, marking a 28.0% increase compared to the previous year[13]. - The pre-tax profit of the treasury business decreased by HKD 7.965 billion or 53.3% year-on-year to HKD 6.968 billion, primarily due to rising funding costs leading to a decline in net interest income[72]. - In 2023, the group's pre-tax profit reached HKD 40.914 billion, a 23.4% increase from HKD 33.162 billion in 2022[58]. Asset and Liability Management - Total assets as of year-end 2023 amounted to HKD 3,868,783 million, an increase from HKD 3,666,505 million in 2022[4]. - The total capital ratio stood at 21.18%, with both the Tier 1 capital ratio and common equity Tier 1 capital ratio at 19.02%[23]. - The total risk-weighted assets decreased by 1.0% to HKD 1,298.956 billion during the year[23]. - The average liquidity coverage ratio for 2023 was 189.68% in Q1, 188.89% in Q2, 193.47% in Q3, and 207.12% in Q4, indicating strong liquidity management[56]. - The total amount of green and sustainable development-linked loans increased by 86.9% compared to the end of 2022[1]. Operational Efficiency - The cost-to-income ratio improved to 25.35% in 2023 from 31.26% in 2022, demonstrating enhanced operational efficiency[4]. - Operating expenses decreased by 2.0% year-on-year, while net operating income before impairment provisions increased by 20.8%[22]. - The average return on total assets for 2023 was 0.90%, up from 0.75% in 2022[4]. - The average return on equity for 2023 was 10.60%, compared to 8.50% in 2022, indicating improved profitability[4]. Customer Growth and Market Expansion - Customer loans grew by 3.3% to HKD 1,702.30 billion, while customer deposits increased by 5.3% to HKD 2,503.84 billion, both exceeding market growth rates[8]. - The company is actively expanding its Southeast Asia business, with branches in multiple countries including Malaysia, Thailand, and Indonesia, enhancing its regional presence[2]. - The company continues to focus on business opportunities in Hong Kong, the Greater Bay Area, Southeast Asia, and overseas markets, enhancing customer service capabilities and digital product offerings[48]. - The customer deposit balance in Southeast Asia reached HKD 75.398 billion, representing a growth rate of 9.5% compared to the end of 2022[80]. Digital Transformation and Innovation - The company is expanding its digital financial services, enhancing mobile banking penetration, and improving online transaction capabilities[9]. - The company has optimized over 160 mobile banking functions, including the launch of a new one-stop IPO section "抽股易" to enhance customer experience[84]. - The company has successfully extended electronic foreign exchange trading to the China Foreign Exchange Trading Center, becoming an approved foreign currency market maker[84]. - The company is actively promoting digital transformation, focusing on data-driven and intelligent-driven strategies to enhance business development[82]. Risk Management - The group emphasizes the importance of effective risk management as a key element for business success, balancing risk control with business development[91]. - Credit risk primarily arises from lending, trade financing, and funding operations, with detailed management information available in financial statement note 4.1[92]. - The group maintains a robust liquidity risk management framework to ensure stable and sufficient cash sources under normal and stressed conditions[96]. - The group employs stress testing as a risk management tool to assess exposure under extreme adverse conditions[103]. Corporate Governance - The company has established a high-quality board of directors and has fully complied with the corporate governance code[164]. - The board consists of 11 members, with 7 independent non-executive directors, representing 63.6% of the board, exceeding the minimum requirement of one-third as per listing rules[185]. - The company has established a board diversity policy that considers various factors, including gender, age, cultural background, and professional experience[188]. - The board's composition reflects a strong commitment to risk management and audit oversight through dedicated committees[127][128]. Sustainability Initiatives - The company aims for "operational carbon neutrality" by 2030 and has published its first TCFD report to detail its sustainable development strategy[10]. - The company actively integrates green finance and ESG elements into product and service design to promote sustainable development in private banking[62]. - The balance of green mortgage loans increased approximately 2.7 times compared to the end of 2022, promoting carbon reduction and environmental sustainability[60]. - The company has implemented a zero-tolerance policy towards corruption and bribery, ensuring compliance with all relevant laws and regulations[175].