泸州银行(01983) - 2025 - 中期财报

Company Profile Luzhou Bank, established in 1997 and listed on the HKEX in 2018, is a commercial bank with 41 branches and a substantial asset base Company Overview Luzhou Bank Co., Ltd. was registered in Luzhou, Sichuan Province, China on September 15, 1997, with its H-shares listed on the HKEX in 2018 - Legal Chinese name: Luzhou Bank Co., Ltd., Legal English name: LUZHOU BANK CO., LTD[8] - Registered capital: RMB 2,717,752,062[8] - H-shares listed on the main board of the Hong Kong Stock Exchange on December 17, 2018, stock code 1983[8][10] Company Status Luzhou Bank operates 41 branches, reporting total assets of RMB 192.254 billion and customer deposits of RMB 155.082 billion - The bank operates 41 branches, including Chengdu, Meishan, and Suining branches[9] Key Scale Indicators as of the End of the Reporting Period | Indicator | Amount (RMB billion) | | :--- | :--- | | Total Assets | 192.254 | | Total Customer Loans | 117.594 | | Total Customer Deposits | 155.082 | Financial Highlights Luzhou Bank reported increased net profit and asset growth for H1 2025, with improved loan quality and stable capital ratios Financial Highlights For H1 2025, Luzhou Bank achieved RMB 902 million net profit, 11.65% YoY growth, with assets up 12.43% and deposits up 14.61% Operating Performance for the Six Months Ended June 30 (RMB thousand) | Item | 2025 | 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Interest Income | 1,897,023 | 1,757,680 | 7.93 | | Net Fee and Commission Income | 78,660 | 82,592 | (4.76) | | Operating Income | 2,422,775 | 2,835,908 | (14.57) | | Operating Expenses | (968,254) | (898,069) | 7.82 | | Expected Credit Losses / Other Asset Impairment Losses | (215,577) | (903,809) | (76.15) | | Profit Before Tax | 1,239,926 | 1,035,133 | 19.78 | | Net Profit | 902,489 | 808,336 | 11.65 | | Net Profit Attributable to Shareholders | 902,489 | 808,336 | 11.65 | | Basic Earnings Per Share (RMB) | 0.30 | 0.26 | 0.04 | Scale Indicators as of June 30, 2025 (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | Change Rate (%) | | :--- | :--- | :--- | :--- | | Total Assets | 192,253,762 | 170,999,572 | 12.43 | | Net Customer Loans | 111,900,229 | 98,585,035 | 13.51 | | Total Liabilities | 179,260,751 | 158,559,168 | 13.06 | | Customer Deposits | 155,081,860 | 135,314,340 | 14.61 | | Equity Attributable to Shareholders | 12,993,011 | 12,440,404 | 4.44 | Asset Quality and Capital Adequacy Ratios as of June 30, 2025 (%) | Indicator | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Non-performing Loan Ratio | 1.18 | 1.19 | (0.01) | | Provision Coverage Ratio | 411.53 | 435.19 | (23.66) | | Core Tier 1 Capital Adequacy Ratio | 8.01 | 8.27 | (0.26) | | Tier 1 Capital Adequacy Ratio | 9.82 | 10.15 | (0.33) | | Capital Adequacy Ratio | 12.66 | 13.12 | (0.46) | Management Discussion and Analysis This section covers Luzhou Bank's operating environment, strategy, financial performance, asset quality, capital, and risk management Environment and Outlook H1 2025 saw weak global recovery, while China's economy grew 5.3% and Sichuan's GDP 5.6%, with banking facing challenges - H1 2025 China's GDP reached RMB 66.1 trillion, a 5.3% year-on-year increase[13] - Sichuan Province's GDP reached RMB 3.2 trillion, a 5.6% year-on-year increase, 0.3 percentage points higher than the national average[13] - The banking industry faces multiple challenges, including continuous narrowing of net interest margins and intensified "involutionary" competition[14] Development Strategy Luzhou Bank will focus on high-quality development, business transformation, asset optimization, and risk control in H2 2025 - Anchor high-quality development goals, unswervingly promote business transformation, and continuously optimize asset structure[15] - Continuously reduce liability costs through innovative measures and increase the proportion of high-quality customers[15] - Further strengthen full-process credit risk control and proactively prevent reputational risks[15] - Continue to increase investment in financial technology and solidify the financial technology foundation[15] - Closely align with the Chengdu-Chongqing economic circle and Luzhou's "one body, two wings" development strategy, actively integrating into the regional economic development landscape[15] Income Statement Analysis H1 2025 profit before tax grew 19.78% to RMB 1.24 billion, net profit rose 11.65% to RMB 902 million, despite revenue decline Impact of Major Profit and Loss Items on Profit Before Tax (RMB thousand) | Item | Amount | | :--- | :--- | | Profit Before Tax for the Six Months Ended June 30, 2024 | 1,035,133 | | Change in Net Interest Income | 139,343 | | Change in Net Fee and Commission Income | (3,932) | | Change in Net Gains from Trading Activities, Financial Investments, and Other Operating Income | (548,544) | | Change in Operating Expenses | (70,185) | | Change in Expected Credit Losses / Other Asset Impairment Losses | 688,232 | | Change in Share of Profit of Associates | (121) | | Profit Before Tax for the Six Months Ended June 30, 2025 | 1,239,926 | Financial Performance Summary H1 2025 profit before tax increased by 19.78% to RMB 1.24 billion, and net profit grew by 11.65% to RMB 902 million - Profit before tax RMB 1.24 billion, a 19.78% year-on-year increase[18] - Net profit RMB 902 million, an 11.65% year-on-year increase[18] Operating Income H1 2025 operating income decreased by 14.57% to RMB 2.423 billion, with net interest income comprising 78.30% - H1 2025 operating income RMB 2.423 billion, a 14.57% year-on-year decrease[20] Operating Income Composition (%) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Net Interest Income | 78.30 | 61.98 | | Net Fee and Commission Income | 3.25 | 2.91 | | Net Gains from Trading Activities, Financial Investments, and Other Operating Income | 18.45 | 35.11 | | Total | 100.00 | 100.00 | Net Interest Income H1 2025 net interest income grew 7.93% to RMB 1.897 billion, driven by asset growth and lower liability costs, despite margin decline - Net interest income RMB 1.897 billion, a 7.93% year-on-year increase[22] - Net interest margin 2.44%, a 0.11 percentage point year-on-year decrease; net interest spread 2.71%, a 0.06 percentage point year-on-year decrease[27] Net Interest Income Change Analysis (RMB thousand) | Item | Scale Factor | Interest Rate Factor | Net Change (Increase/Decrease) | | :--- | :--- | :--- | :--- | | Change in Interest Income | 466,459 | (339,869) | 126,590 | | Change in Interest Expense | 292,072 | (304,825) | (12,753) | | Change in Net Interest Income | 174,387 | (35,044) | 139,343 | Interest Income H1 2025 interest income grew 3.38% to RMB 3.872 billion, primarily from interest-earning asset growth, with customer loan interest up - Interest income RMB 3.872 billion, a 3.38% year-on-year increase, primarily due to growth in interest-earning assets[30] - Customer loan interest income RMB 3.354 billion, a 7.15% year-on-year increase[31] - Investment interest income RMB 421 million, a 19.46% year-on-year decrease, mainly due to a decline in average investment yield[34] Interest Expense H1 2025 interest expense decreased 0.64% to RMB 1.975 billion, mainly due to lower average cost of interest-bearing liabilities - Interest expense RMB 1.975 billion, a 0.64% year-on-year decrease, primarily due to a decline in the average cost of interest-bearing liabilities[37] - Customer deposit interest expense RMB 1.713 billion, a 2.79% year-on-year increase[38] - Interbank and other financial institutions' deposit and borrowing interest expense RMB 38 million, a 45.85% year-on-year decrease[41] - Interest expense on issued bonds RMB 172 million, an 8.84% year-on-year decrease[42] Net Non-Interest Income H1 2025 net non-interest income significantly decreased by 51.24% to RMB 526 million - Net non-interest income RMB 526 million, a 51.24% year-on-year decrease[44] Net Fee and Commission Income H1 2025 net fee and commission income decreased by RMB 3.932 million to RMB 78,660 thousand - Net fee and commission income RMB 78,660 thousand, a RMB 3,932 thousand year-on-year decrease[45] Fee and Commission Income Composition (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Wealth Management Business Fee Income | 78,907 | 94,274 | | Agency Business Fee Income | 5,301 | 1,254 | | Guarantee and Commitment Business Fee Income | 13,342 | 3,991 | Net Gains from Trading Activities, Financial Investments, and Other Operating Income H1 2025 combined net gains from trading activities, financial investments, and other operating income totaled RMB 447 million, a 55.09% decrease - Net gains from trading activities, financial investments, and other operating income totaled RMB 447 million, a 55.09% year-on-year decrease[48] Composition of Net Gains from Trading Activities, Financial Investments, and Other Operating Income (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Net Gains from Trading Activities | 321,174 | 492,091 | | Net Gains from Financial Investments | 88,745 | 197,435 | | Other Operating Income | 37,173 | 306,110 | Operating Expenses H1 2025 operating expenses increased by 7.82% to RMB 968 million, primarily due to higher staff costs - Operating expenses RMB 968 million, a 7.82% year-on-year increase[50] Major Components of Operating Expenses (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Staff Costs | 478,589 | 444,107 | | Business and Administrative Expenses | 281,049 | 296,844 | | Depreciation and Amortization | 99,327 | 84,888 | Expected Credit Losses / Other Asset Impairment Losses H1 2025 expected credit losses and other asset impairment losses significantly decreased by 76.15% to RMB 216 million - Expected credit losses / other asset impairment losses RMB 216 million, a 76.15% year-on-year decrease[53] - Expected credit losses on loans (including bill discounts) RMB 452 million, a 28.60% year-on-year decrease[55] Analysis of Key Balance Sheet Items As of June 2025, Luzhou Bank's total assets grew 12.43% to RMB 192.254 billion, liabilities 13.06% to RMB 179.261 billion, and equity 4.44% to RMB 12.993 billion - As of the end of June 2025, total assets RMB 192.254 billion, a 12.43% increase from the end of the previous year[56] - As of the end of June 2025, total liabilities RMB 179.261 billion, a 13.06% increase from the end of the previous year[77] - As of the end of June 2025, shareholders' equity RMB 12.993 billion, a 4.44% increase from the end of the previous year[83] Assets As of June 2025, total assets grew 12.43% to RMB 192.254 billion, with net customer loans up 13.51% and corporate loans at 88.26% Total Assets Composition (RMB thousand) | Item | June 30, 2025 Amount | Percentage of Total % | | :--- | :--- | :--- | | Net Customer Loans | 111,900,229 | 58.20 | | Financial Investments - Financial Assets at Fair Value Through Profit or Loss | 35,550,571 | 18.49 | | Financial Investments - Measured at Amortized Cost | 20,638,532 | 10.74 | | Cash and Balances with Central Bank | 11,334,465 | 5.90 | | Total Assets | 192,253,762 | 100.00 | - Total customer loans RMB 117.594 billion, a 13.15% increase from the end of the previous year[60] - Corporate loans totaled RMB 103.784 billion, a 15.78% increase from the end of the previous year, accounting for 88.26% of total customer loans[62] - Personal loans RMB 12.845 billion, a 4.37% decrease from the end of the previous year, accounting for 10.92% of total customer loans[64] - Investment book value RMB 63.610 billion, a 9.88% increase from the end of the previous year[65] Liabilities As of June 2025, total liabilities grew 13.06% to RMB 179.261 billion, with customer deposits up 14.61% to RMB 155.082 billion Total Liabilities Composition (RMB thousand) | Item | June 30, 2025 Amount | Percentage of Total % | | :--- | :--- | :--- | | Customer Deposits | 155,081,860 | 86.51 | | Issued Bonds | 14,366,963 | 8.01 | | Borrowings from Central Bank | 5,609,509 | 3.13 | | Total Liabilities | 179,260,751 | 100.00 | - Total customer deposits RMB 155.082 billion, a 14.61% increase from the end of the previous year[79] - Issued bonds RMB 14.367 billion, a 12.72% increase from the end of the previous year[82] Shareholders' Equity As of June 2025, shareholders' equity increased by 4.44% to RMB 12.993 billion - Shareholders' equity RMB 12.993 billion, a 4.44% increase from the end of the previous year[83] Other Financial Information At period-end, Luzhou Bank's off-balance sheet credit commitments were RMB 4.042 billion, with no overdue debt and some pledged assets - Credit commitment balance RMB 4.042 billion[85] - At the end of the reporting period, the bank had no overdue and unpaid debts[86] - At the end of the reporting period, some of the bank's assets were pledged to the central bank as collateral in accordance with agreements[87] Loan Quality Analysis Total loans grew 13.13% to RMB 116.829 billion, NPL ratio slightly down 0.01 percentage points to 1.18%, with coverage at 411.53% - At the end of the reporting period, total loans RMB 116.829 billion, a 13.13% increase from the end of the previous year[88] - Total non-performing loans RMB 1.384 billion, an increase of RMB 156 million from the end of the previous year; non-performing loan ratio 1.18%, a 0.01 percentage point decrease from the end of the previous year[88] Loan Distribution by Five-Category Classification (RMB thousand) | Item | June 30, 2025 Amount | Percentage of Total % | | :--- | :--- | :--- | | Normal Loans | 113,599,469 | 97.24 | | Special Mention Loans | 1,845,647 | 1.58 | | Total Non-performing Loans | 1,384,379 | 1.18 | | Total Customer Loans | 116,829,495 | 100.00 | - Corporate non-performing loans primarily include real estate, leasing and business services, and construction industries, accounting for 88.10% of total corporate non-performing loans[92] - Retail loan non-performing loan ratio increased by 0.52 percentage points to 4.18% from the end of the previous year[98] - At the end of the reporting period, overdue loans RMB 1.788 billion, an increase of RMB 238 million from the end of the previous year; the ratio of overdue loans to total loans was 1.53%, an increase of 0.03 percentage points from the end of the previous year[108] - Strengthen post-loan management and risk early warning to promptly identify risk hidden dangers[111] - Formulate "one household, one policy" disposal plans to improve collection efficiency[111] - Revitalize existing judicial resources and unblock litigation collection channels[111] Capital Adequacy Ratio Analysis Luzhou Bank's capital adequacy ratios exceed regulatory standards despite a slight decline due to slower capital growth relative to risk-weighted assets - The bank's capital management aims to meet regulatory requirements and continuously improve capital risk resilience and capital returns[114] Capital Adequacy Ratio Related Indicators (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Net Capital | 16,722,739 | 16,025,971 | | Core Tier 1 Capital Adequacy Ratio | 8.01% | 8.27% | | Tier 1 Capital Adequacy Ratio | 9.82% | 10.15% | | Capital Adequacy Ratio | 12.66% | 13.12% | - During the reporting period, the growth rate of the bank's net capital was slightly lower than the growth rate of risk-weighted assets, leading to a decrease in capital adequacy ratios compared to the end of the previous year, but all levels of capital adequacy ratios remained above regulatory standards[117] - The liquidity ratio was 76.30%, 51.30 percentage points higher than the regulatory requirement[119][131] Risk Management Luzhou Bank manages credit, operational, market, and liquidity risks through optimized structures, enhanced approvals, internal controls, and stress testing - The bank's risk management policy aims to identify, analyze, set limits, monitor, and control various financial risks[351] - The Board of Directors is the highest risk management body for the entire bank, and senior management is responsible for the overall implementation of risk management[352] Credit Risk Luzhou Bank strengthens credit risk management through optimizing credit allocation, enhancing approvals, intensifying post-loan management, and NPL recovery - Adhere to policy guidance, optimize and adjust credit structure, and promote the continuous healthy development of credit business[120] - Strengthen credit approval, strictly implement hierarchical authorization management for credit business, and enhance group credit management[120] - Strengthen post-loan management, strictly control risks in the post-loan stage, and promptly identify adverse changes and take control measures[123] - Strengthen monitoring of overdue loans and risk early warning loans, formulate "one household, one policy" plans, and intensify collection and disposal efforts[123] Operational Risk Luzhou Bank strengthens operational risk prevention, aiming for zero major events by solidifying internal controls, promoting compliance, and enhancing tech risk control - As of the end of the reporting period, major operational risk events and case-related risk events were zero[122] - Solidify internal control levels, improve systems, processes, and standards, and strengthen special inspections and risk assessments[125] - Promote compliance culture, embedding the philosophy of "internal control first, compliance as fundamental"[125] - Strengthen case risk control, regularly investigate abnormal employee behavior, and conduct special screening work[125] - Enhance technological risk control, ensure secure system operation, and guarantee the completeness, compliance, and effectiveness of information technology outsourcing management[125] Market Risk Luzhou Bank manages interest rate and exchange rate risks within reasonable limits through a comprehensive market risk management system - The market risks faced by the bank primarily include interest rate risk and exchange rate risk[126] - Interest rate risk is primarily managed by regularly measuring interest rate sensitivity gaps, assessing the impact of interest rate changes on net profit and net worth, and adjusting asset-liability product portfolios and maturity structures[127] - Exchange rate risk primarily arises from temporary conversion risks due to exchange rate fluctuations in interbank and customer foreign exchange settlement and sales businesses, currently within controllable limits[128] Liquidity Risk Luzhou Bank manages liquidity risk to ensure sufficient funds in all scenarios, with ratios significantly exceeding regulatory requirements - The purpose of liquidity risk management is to ensure sufficient funds in both normal operating scenarios and stressed conditions to meet maturing debt payments and business operating capital needs[129] Liquidity Indicators (%) | Indicator | June 30, 2025 | Regulatory Requirement | | :--- | :--- | :--- | | Liquidity Ratio | 76.30 | 25.00 | | High-Quality Liquid Assets Adequacy Ratio | 143.16 | 100.00 | | Liquidity Matching Ratio | 154.76 | 100.00 | - Strengthen deposit marketing efforts, promote growth in various deposits, and improve the overall stability of liabilities[133] - Continuously monitor various liquidity risk indicators and limit management through the liquidity risk management information system[133] - Regularly conduct liquidity risk stress tests[133] Information Technology Risk Management Luzhou Bank's IT risk management ensures stable system operation, with zero major events, by addressing cybersecurity, business continuity, and outsourcing risks - As of the end of the reporting period, major information technology risk events were zero[132] - Implement strict network segmentation, logically isolating internet information systems from internal systems, and regularly conduct system penetration tests and vulnerability scans[135] - Develop a business continuity management system, identify important businesses and information systems, and formulate business continuity plans and emergency response plans[135] - Strengthen outsourcing management, ensure data security through de-sensitization technology, and formulate and exercise outsourcing emergency plans[135] Segment Reporting Luzhou Bank reports results across corporate, retail, financial markets, and other segments, with corporate banking contributing 50.14% of PBT Profit Before Tax by Business Segment (RMB thousand) | Item | 2025 Segment Profit Before Tax | 2025 Percentage % | 2024 Segment Profit Before Tax | 2024 Percentage % | | :--- | :--- | :--- | :--- | :--- | | Corporate Banking Business | 621,731 | 50.14 | 601,212 | 58.08 | | Retail Banking Business | 108,804 | 8.78 | 117,248 | 11.33 | | Financial Markets Business | 479,902 | 38.70 | 307,217 | 29.68 | | Other | 29,489 | 2.38 | 9,456 | 0.91 | | Total | 1,239,926 | 100.00 | 1,035,133 | 100.00 | Operating Income by Business Segment (RMB thousand) | Item | 2025 Segment Operating Income | 2025 Percentage % | 2024 Segment Operating Income | 2024 Percentage % | | :--- | :--- | :--- | :--- | :--- | | Corporate Banking Business | 1,596,677 | 65.90 | 1,732,096 | 61.07 | | Retail Banking Business | 344,775 | 14.23 | 323,213 | 11.40 | | Financial Markets Business | 444,148 | 18.33 | 769,010 | 27.12 | | Other | 37,175 | 1.54 | 11,589 | 0.41 | | Total | 2,422,775 | 100.00 | 2,835,908 | 100.00 | Business Review Luzhou Bank's business segments developed steadily, with corporate loans up 15.78%, retail deposits up 7.73%, and bond investments up 24.09% Corporate Banking Business Corporate banking loans grew 15.78% to RMB 103.784 billion, with small and micro enterprise loans at 59.46% and customer accounts up 7.53% - Corporate loan balance RMB 103.784 billion, a 15.78% increase from the beginning of the year[141] - Small and micro enterprise loans RMB 61.714 billion, accounting for 59.46% of total corporate loans[141] - Corporate banking customer accounts totaled 57,671, a 7.53% increase from the beginning of the year[146] - Inclusive small and micro loan balance RMB 14.411 billion, with 8,492 accounts, and a weighted average interest rate of 5.09%[147] Retail Banking Business Retail banking serves 1.5283 million customers, with deposits up 7.73% to RMB 85.892 billion, and RMB 8.617 billion in wealth products sold - As of June 30, 2025, the bank had 1.5283 million retail banking customers[148] - Retail deposit balance RMB 85.892 billion, a 7.73% increase from the end of the previous year[149] - Total retail loans RMB 12.845 billion[150] - In H1 2025, the bank sold wealth management products totaling RMB 8.617 billion, and agency-sold trust schemes totaling RMB 989 million[152][153] Financial Markets Business Financial markets business remained stable, with bond investments up 24.09% to RMB 49.380 billion, while SPV investments decreased 26.68% - Placements with other banks and financial institutions balance RMB 1.571 billion, a 584.45% increase from the beginning of the year[158] - Interbank loans had no balance, a RMB 300 million decrease from the beginning of the year, a 100.00% reduction[159] - Bond investment scale RMB 49.380 billion, a 24.09% increase from the beginning of the year[164] - Special purpose vehicle investment scale RMB 11.664 billion, a 26.68% decrease from the beginning of the year, mainly due to reduced public fund investments[165] Financial Consumer Rights Protection Luzhou Bank enhances consumer rights protection by integrating it into governance, establishing systems, upholding customer-centric service, and managing across the product lifecycle - Incorporate consumer rights protection into corporate governance, corporate culture construction, and business development strategies[167] - Establish and improve a consumer rights protection system that matches the bank's organizational structure and business development[168] - Adhere to the philosophy of "customer-centric" and "service creates value," providing "standardized, rigorous, honest, and reliable" financial services[169] - Achieve full-process, full-coverage, and all-round management of consumer rights protection in product design, service items, pricing management, agreement formulation, approval access, and marketing promotion[170] Share Capital Changes and Shareholder Information This section details Luzhou Bank's stable share capital structure, with no changes during the reporting period, and provides an overview of its major shareholders - As of the end of the reporting period, the bank's total shares were 2,717,752,062, comprising 1,964,632,062 domestic shares and 753,120,000 H-shares[173] Share Capital Changes Luzhou Bank's share capital remained unchanged during the reporting period - The bank's share capital remained unchanged during the reporting period[171] Shareholding Structure Table As of June 30, 2025, Luzhou Bank's total share capital was 2,717,752,062 shares, with domestic shares at 72.29% and H-shares at 27.71% Shareholding Structure (shares, %) | Item | June 30, 2025 Quantity | June 30, 2025 Proportion | | :--- | :--- | :--- | | Total Share Capital | 2,717,752,062 | 100.00 | | Domestic Corporate Shares | 1,914,695,969 | 70.45 | | Domestic Individual Shares | 49,936,093 | 1.84 | | H-shares | 753,120,000 | 27.71 | Purchase, Sale or Redemption of the Bank's Listed Securities During the reporting period, Luzhou Bank did not purchase, sell, or redeem any of its listed securities and held no treasury shares - During the reporting period, the bank did not purchase, sell, or redeem any of its listed securities[172] - As of the end of the reporting period, the bank held no treasury shares[172] Shareholder Details As of period-end, Luzhou Bank had 2,717,752,062 total shares, with Luzhou Laojiao Group as the largest domestic shareholder at 14.37% Top 10 Domestic Shareholders Luzhou Laojiao Group Co., Ltd. held 14.37% of domestic shares, while Sichuan Jiale Enterprise Group Co., Ltd. and Luzhou Xinfu Mining Group Co., Ltd. each held 11.97% Top 10 Domestic Shareholders (shares, %) | No. | Shareholder Name | Number of Shares Held | Shareholding Proportion | | :--- | :--- | :--- | :--- | | 1 | Luzhou Laojiao Group Co., Ltd. | 390,528,000 | 14.37 | | 2 | Sichuan Jiale Enterprise Group Co., Ltd. | 325,440,000 | 11.97 | | 3 | Luzhou Xinfu Mining Group Co., Ltd. | 325,440,000 | 11.97 | | 4 | Luzhou Municipal Finance Bureau | 193,853,760 | 7.13 | | 5 | Luzhou State-owned Assets Management Co., Ltd. | 173,568,000 | 6.39 | Interests and Short Positions of Major Shareholders and Other Persons in Shares and Underlying Shares under Hong Kong Regulations Luzhou Laojiao Group and its controlled entities held 15.97% of shares, Sichuan Jiale Enterprise Group and associates held 11.97%, and OTX ADVISORY HOLDINGS, INC. held 4.99% of H-shares - Luzhou Laojiao Group Co., Ltd. directly and indirectly held 433,920,000 domestic shares, accounting for 15.97% of the bank's issued shares[175] - Sichuan Jiale Enterprise Group Co., Ltd. beneficially owned 325,440,000 domestic shares, accounting for 11.97% of the bank's issued shares[175] - OTX ADVISORY HOLDINGS, INC. beneficially owned 135,672,000 H-shares, accounting for 4.99% of the bank's issued shares[178] Major Shareholders of the Bank Major shareholders are those holding over 5% of shares or voting rights, or having significant influence on management - A major shareholder of a commercial bank refers to a shareholder who holds or controls more than 5% of the commercial bank's shares or voting rights, or who holds less than 5% of the total capital or shares but has a significant influence on the commercial bank's operation and management[185] Directors, Supervisors, Senior Management, and Employees This section outlines the composition of Luzhou Bank's governance bodies, personnel changes, compliance, and employee demographics, training, and compensation Directors, Supervisors, Senior Management, and Employees Luzhou Bank's Board has 11 directors, the Supervisory Board has 5 supervisors, and senior management comprises 11 members - The Board of Directors has 11 directors, including 2 executive directors, 4 non-executive directors, and 5 independent non-executive directors[188] - The Board of Supervisors has 5 supervisors, including 1 shareholder supervisor, 2 employee supervisors, and 2 external supervisors[189] - The bank has 11 senior management members, including the President, Vice Presidents, Chief Information Officer, and Board Secretary[190] Changes in Directors, Supervisors and Senior Management Mr. Fan Jingdong became an independent non-executive director in April 2025, Mr. Wang Chong was appointed vice president, and Mr. Luo Huoming assumed new leadership roles - Mr. Fan Jingdong was elected as an independent non-executive director by the general meeting and took office on April 27, 2025, after obtaining approval for his qualifications[192] - There were no changes in supervisory board members during the reporting period and up to the latest practicable date[194] - Mr. Wang Chong was appointed as Vice President by the bank's Board of Directors on January 23, 2025, and will officially assume duties after obtaining regulatory approval[195] - Mr. Luo Huoming, the bank's non-executive director, has served as Chairman of Luzhou Development Holdings Group Co., Ltd., Chairman of Luzhou Industrial Development Investment Group Co., Ltd., and concurrently Chairman of Luzhou Tianhua (Group) Co., Ltd. since April 2025[196] Securities Transactions by Directors and Supervisors Luzhou Bank adopted the Model Code for directors' and supervisors' securities transactions, with all confirming compliance during the period - The bank has adopted the Model Code as the code governing securities transactions by its directors and supervisors[197] - All directors and supervisors of the bank confirmed their compliance with the Model Code during the reporting period[197] Employee Information As of June 30, 2025, Luzhou Bank had 1,615 employees with an average age of 34.80, 64.71% holding bachelor's degrees or higher - As of June 30, 2025, the bank had a total of 1,615 employees, with an average age of 34.80 years[198] Employee Age Distribution | Age Group | Number of People | Percentage % | | :--- | :--- | :--- | | 20 (inclusive) to 30 years old | 490 | 30.34 | | 30 (inclusive) to 40 years old | 762 | 47.18 | | 40 (inclusive) to 50 years old | 238 | 14.74 | | 50 (inclusive) and above | 125 | 7.74 | Employee Education Distribution | Education Level | Number of People | Percentage % | | :--- | :--- | :--- | | Master's Degree and Above | 345 | 21.36 | | Bachelor's Degree | 1,045 | 64.71 | | Junior College and Below | 225 | 13.93 | - The bank has a total of 158 technology professionals, accounting for 9.78% of the total workforce[202] Employee Training Luzhou Bank's employee training aligns with its strategy, expanding platforms, enriching resources, and optimizing programs, with 120 sessions for 6,000+ participants - The bank's employee training is conducted in conjunction with its development strategic goals and the actual capabilities of its employees, continuously expanding training platforms, enriching training resources, optimizing training programs, and improving talent development mechanisms[204] - During the reporting period, approximately 120 types of internal and external training sessions were organized, with over 6,000 participants[204] Employee Compensation Policy In 2025, Luzhou Bank implemented a market-oriented compensation system with dual career paths, linking pay to performance and providing comprehensive benefits - In 2025, the bank implemented a market-oriented compensation system based on position salary, with performance-based compensation that can fluctuate upwards or downwards[205] - The bank established dual career paths for employee salary progression based on dual career development paths, expanding salary progression opportunities for professional series employees[205] - Position salary is closely linked to position value and individual ability, while performance-based compensation is closely linked to value creation, performance contribution, and performance[205] - The bank contributes to "five insurances and one housing fund" for employees, purchases supplementary medical insurance, and establishes an enterprise annuity plan[205] - A mechanism for deferred payment and clawback of performance-based compensation has been established[205] Significant Matters This section covers Luzhou Bank's corporate governance, 2024 dividend, absence of major litigation or penalties, and interim financial review Corporate Governance Luzhou Bank strictly complied with laws and Listing Rules, continuously improving its corporate governance structure and adopting the Corporate Governance Code - During the reporting period, the bank strictly adhered to laws and regulations such as the "Company Law of the People's Republic of China" and the "Commercial Bank Law of the People's Republic of China," as well as relevant provisions of the "Listing Rules," continuously improving its corporate governance structure and enhancing its corporate governance level[206] - The bank has also adopted Part 2 of the Corporate Governance Code in Appendix C1 of the "Listing Rules," meeting the management requirements and corporate governance standards for domestic commercial banks[206] Dividend Distribution Luzhou Bank distributed a RMB 326.13 million final dividend for 2024 on July 29, 2025, and has no plans for a H1 2025 interim dividend - The bank distributed a final dividend for 2024 of RMB 1.2 per 10 shares (tax inclusive), totaling RMB 326.13 million (tax inclusive), to shareholders registered on the bank's share register as of July 11, 2025[208] - The bank has not declared and has no plans to declare an interim dividend for the six months ended June 30, 2025[209] Major Litigation and Arbitration Matters During the reporting period, Luzhou Bank had no litigation or arbitration matters that significantly impacted its operations - During the reporting period, the bank had no litigation or arbitration matters that significantly impacted its operations[210] Penalties Imposed on the Bank, its Directors, Supervisors, and Senior Management During the reporting period, Luzhou Bank and its directors, supervisors, and senior management received no significant penalties from regulatory bodies - During the reporting period, the bank and all its directors, supervisors, and senior management were not subject to investigations, administrative penalties, public criticisms by the China Securities Regulatory Commission or public condemnations by the Hong Kong Stock Exchange, nor did they receive any other penalties from regulatory bodies that had a significant impact on the bank's operations[211] Major Contracts and Their Performance During the reporting period, Luzhou Bank had no major contracts or their performance to report - During the reporting period, the bank had no major contracts or their performance to report[212] Review of Interim Results Luzhou Bank's unaudited H1 2025 financial information was reviewed by Deloitte Touche Tohmatsu, receiving an unmodified report, and approved by the Audit Committee and Board - The bank's unaudited interim financial information for 2025, prepared in accordance with International Financial Reporting Standards, has been reviewed by Deloitte Touche Tohmatsu, which issued an unmodified review report[214] - The bank's 2025 interim report and unaudited interim financial information for 2025 have been reviewed by the bank's Audit Committee and Board of Directors[215] Major Asset Acquisitions, Disposals, and Business Combinations During the reporting period, Luzhou Bank did not engage in any major asset acquisitions, disposals, or business combinations - During the reporting period, the bank did not engage in any major asset acquisitions, disposals, or business combinations[216] Major Post-Balance Sheet Events From the end of the reporting period to the latest practicable date, Luzhou Bank had no major post-balance sheet events - From the end of the reporting period to the latest practicable date, the bank had no major post-balance sheet events[217] Independent Auditor's Report This section presents the independent auditor's report on Luzhou Bank's interim condensed financial statements, confirming the scope of review and an unmodified conclusion Introduction Deloitte Touche Tohmatsu reviewed Luzhou Bank's H1 2025 interim condensed financial statements, prepared under HKEX Listing Rules and IAS 34 - Deloitte Touche Tohmatsu reviewed the interim condensed financial statements of Luzhou Bank Co., Ltd[218] - The interim condensed financial statements were prepared in accordance with the requirements of the "Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited" and "International Accounting Standard 34 – Interim Financial Reporting"[218] Scope of Review The review, conducted under ISRE 2410, involved inquiries and analytical procedures, being less extensive than an audit, thus no audit opinion is expressed - The review was conducted in accordance with "International Standard on Review Engagements 2410 – Review of Interim Financial Information Performed by the Independent Auditor of the Entity"[219] - The scope of a review is substantially less than that of an audit conducted in accordance with International Standards on Auditing, and consequently, we do not express an audit opinion on these financial statements[219] Conclusion Based on the review, no matters were identified suggesting the interim condensed financial statements were not prepared in all material respects under IAS 34 - Based on our review, nothing has come to our attention that causes us to believe that the interim condensed financial statements are not prepared, in all material respects, in accordance with International Accounting Standard 34[220] Financial Statements and Notes This section includes Luzhou Bank's interim condensed financial statements and detailed notes, providing essential context on its financial position and performance - The bank's main business lines include corporate banking, retail banking, and financial markets business[230] - This unaudited interim condensed financial statement is prepared in accordance with the requirements of "International Accounting Standard 34 – Interim Financial Reporting" issued by the International Accounting Standards Board, and the disclosure requirements of the "Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited"[232] - The bank has not adopted any new standards, amendments, or interpretations that are not yet effective for the current accounting period[235] Interim Condensed Statement of Profit or Loss and Other Comprehensive Income H1 2025 net profit was RMB 902,489 thousand, total comprehensive income RMB 874,170 thousand, with net interest income up but overall operating income down Interim Condensed Statement of Profit or Loss and Other Comprehensive Income Summary (RMB thousand) | Item | 2025 (Unaudited) | 2024 (Unaudited) | | :--- | :--- | :--- | | Net Interest Income | 1,897,023 | 1,757,680 | | Operating Income | 2,422,775 | 2,835,908 | | Expected Credit Losses | (214,757) | (903,775) | | Net Profit | 902,489 | 808,336 | | Total Comprehensive Income Attributable to Shareholders | 874,170 | 766,349 | | Basic and Diluted Earnings Per Share (RMB) | 0.30 | 0.26 | Interim Condensed Statement of Financial Position As of June 30, 2025, total assets were RMB 192,253,762 thousand, total liabilities RMB 179,260,751 thousand, and total shareholders' equity RMB 12,993,011 thousand Interim Condensed Statement of Financial Position Summary (RMB thousand) | Item | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Total Assets | 192,253,762 | 170,999,572 | | Customer Loans | 111,900,229 | 98,585,035 | | Financial Investments - Financial Assets at Fair Value Through Profit or Loss | 35,550,571 | 32,867,602 | | Total Liabilities | 179,260,751 | 158,559,168 | | Customer Deposits | 155,081,860 | 135,314,340 | | Total Shareholders' Equity | 12,993,011 | 12,440,404 | Interim Condensed Statement of Changes in Equity As of June 30, 2025, total shareholders' equity reached RMB 12,993,011 thousand, driven by RMB 902,489 thousand net profit and RMB 874,170 thousand comprehensive income - As of June 30, 2025, total shareholders' equity (unaudited) was RMB 12,993,011 thousand[225] - Net profit for the period was RMB 902,489 thousand, and total comprehensive income was RMB 874,170 thousand[225] - Capital contributed by holders of other equity instruments was RMB 1,799,667 thousand[225] - Dividends paid to ordinary shareholders were RMB 326,130 thousand[225] Interim Condensed Statement of Cash Flows H1 2025 operating activities generated RMB 1,030,248 thousand net cash inflow, investing activities had RMB 1,439,896 thousand net outflow, and financing activities had RMB 1,438,126 thousand net inflow Interim Condensed Statement of Cash Flows Summary (RMB thousand) | Item | 2025 (Unaudited) | 2024 (Unaudited) | | :--- | :--- | :--- | | Net Cash Inflow from Operating Activities | 1,030,248 | 5,495,278 | | Net Cash (Outflow) / Inflow from Investing Activities | (1,439,896) | 455,878 | | Net Cash Inflow / (Outflow) from Financing Activities | 1,438,126 | (2,710,242) | | Net Increase in Cash and Cash Equivalents | 1,028,245 | 3,240,934 | | Cash and Cash Equivalents at End of Period | 4,550,408 | 6,321,672 | Notes to the Interim Condensed Financial Information These notes detail Luzhou Bank's background, accounting policies, financial item changes, risk management, related party transactions, and fair value measurements General Information Luzhou Bank Co., Ltd., established in 1997 and renamed in 2019, was listed on the HKEX in 2018, with core businesses in corporate, retail, and financial markets - The bank was listed and traded on the main board of The Stock Exchange of Hong Kong Limited on December 17, 2018[229] - The bank's main business lines include corporate banking business, retail banking business, and financial markets business[230] Basis of Preparation and Accounting Policies The unaudited interim condensed financial statements are prepared under IAS 34 and HKEX Listing Rules, reviewed by Deloitte, with no significant impact from IAS 21 (amendment) - This unaudited interim condensed financial statement is prepared in accordance with the requirements of "International Accounting Standard 34 – Interim Financial Reporting" issued by the International Accounting Standards Board, and the disclosure requirements of the "Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited"[232] - This interim condensed financial statement is unaudited but has been reviewed by the bank's independent auditor, Deloitte Touche Tohmatsu, in accordance with "International Standard on Review Engagements 2410 – Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the International Auditing and Assurance Standards Board[232] - The adoption of "International Accounting Standard 21 (Amendment): Lack of Exchangeability" has not had a significant impact on the bank's financial position and financial performance[234] Net Interest Income H1 2025 net interest income was RMB 1,897,023 thousand, an increase from prior year, mainly from customer loans and financial investments Net Interest Income Composition (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Total Interest Income | 3,871,606 | 3,745,016 | | Total Interest Expense | (1,974,583) | (1,987,336) | | Net Interest Income | 1,897,023 | 1,757,680 | Net Fee and Commission Income H1 2025 net fee and commission income was RMB 78,660 thousand, a decrease from prior year, with wealth management fees as the main component Net Fee and Commission Income Composition (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Total Fee and Commission Income | 102,556 | 104,615 | | Fee and Commission Expense | (23,896) | (22,023) | | Net Fee and Commission Income | 78,660 | 82,592 | Net Gains from Trading Activities H1 2025 net gains from trading activities were RMB 321,174 thousand, a decrease from prior year, mainly from realized bond gains Net Gains from Trading Activities Composition (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Bonds - Realized Gains/Losses | 436,561 | 403,354 | | Bonds - Unrealized Gains/Losses | (111,110) | 86,094 | | Exchange Gains/Losses | (4,277) | 2,643 | | Total | 321,174 | 492,091 | Net Gains from Financial Investments H1 2025 net gains from financial investments were RMB 88,745 thousand, a significant decrease, mainly due to unrealized FVTPL gains turning to losses Net Gains from Financial Investments Composition (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Realized Gains/Losses on Financial Assets at Fair Value Through Profit or Loss | 114,766 | 137,272 | | Unrealized Gains/Losses on Financial Assets at Fair Value Through Profit or Loss | (29,286) | 59,945 | | Trading Spreads on Financial Assets at Fair Value Through Other Comprehensive Income | 3,265 | 218 | | Total | 88,745 | 197,435 | Other Operating Income H1 2025 other operating income was RMB 37,173 thousand, a significant decrease from prior year, mainly due to lower non-current asset disposal gains Other Operating Income Composition (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Rewards and Subsidies | 34,649 | 6,248 | | Rental Income | 1,396 | 4,582 | | Gains from Disposal of Non-current Assets | 95 | 294,603 | | Total | 37,173 | 306,110 | Operating Expenses H1 2025 operating expenses increased to RMB 968,254 thousand, with staff costs being the largest component, including higher salaries and defined contribution plan expenses Major Components of Operating Expenses (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Staff Costs | 478,589 | 444,107 | | Business and Administrative Expenses | 281,049 | 296,844 | | Depreciation and Amortization | 99,327 | 84,888 | | Total | 968,254 | 898,069 | Staff Costs Composition (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Salaries and Bonuses | 332,072 | 327,282 | | Defined Contribution Plans | 53,038 | 45,676 | | Employee Welfare Expenses | 32,183 | 35,126 | | Total | 478,589 | 444,107 | Expected Credit Losses / Other Asset Impairment Losses H1 2025 expected credit losses and other asset impairment losses significantly decreased to RMB 215,577 thousand, with customer loan ECL remaining the largest component Expected Credit Losses / Other Asset Impairment Losses Composition (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Expected Credit Losses on Customer Loans Measured at Amortized Cost | 451,919 | 630,126 | | Expected Credit Losses on Credit-related Financial Investments | (231,868) | 22,072 | | Expected Credit Losses on Financial Investments Measured at Amortized Cost | 4,446 | 248,389 | | Total | 214,757 | 903,775 | | Other Asset Impairment Losses | 820 | 34 | Income Tax Income tax is calculated at a 25% statutory rate, with differences from theoretical amounts due to tax-exempt income and non-deductible expenses - Income tax is calculated based on the estimated taxable income for each corresponding year/period at a statutory rate of 25% as determined by Chinese income tax laws[246] Income Tax Reconciliation (RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Profit Before Tax | 1,239,926 | 1,035,133 | | Tax Calculated at 25% | 309,982 | 258,783 | | Tax Impact of Tax-Exempt Income | (35,943) | (36,924) | | Tax Impact of Non-Deductible Expenses | 52,481 | 4,938 | | Income Tax Expense | 337,437 | 226,797 | Basic and Diluted Earnings Per Share H1 2025 basic earnings per share increased to RMB 0.30, with no difference from diluted EPS due to no potential dilutive shares - Basic earnings per share is calculated by dividing the net profit attributable to the bank's shareholders for the period by the weighted average number of ordinary shares outstanding during the period[248] Earnings Per Share Calculation (RMB) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Net Profit Attributable to Ordinary Shareholders | 807,389 | 713,236 | | Weighted Average Number of Ordinary Shares (thousand shares) | 2,717,752 | 2,717,752 | | Basic Earnings Per Share (RMB) | 0.30 | 0.26 | - As the bank has no potential dilutive shares, there is no difference between basic and diluted earnings per share[249] Cash and Balances with Central Bank As of June 30, 2025, cash and central bank balances totaled RMB 11,334,465 thousand, with statutory reserve deposits as the main component Cash and Balances with Central Bank Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash | 132,694 | 104,095 | | Statutory Reserve Deposits with Central Bank | 7,991,905 | 7,028,146 | | Excess Reserve Deposits with Central Bank | 3,168,501 | 2,924,529 | | Total | 11,334,465 | 10,234,384 | - Statutory reserve deposits are general deposit reserves and foreign exchange risk reserves deposited by the bank with the People's Bank of China as required, and cannot be used for the bank's daily operating activities[250] Placements with and Loans to Banks and Other Financial Institutions As of June 30, 2025, placements with and loans to banks and other financial institutions totaled RMB 1,572,590 thousand, a significant increase Placements with and Loans to Banks and Other Financial Institutions Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Placements with Banks and Other Financial Institutions | 1,570,689 | 229,482 | | Loans to Banks | – | 300,000 | | Debt Instruments Purchased Under Resale Agreements | – | 200,000 | | Total | 1,572,590 | 729,137 | Customer Loans As of June 30, 2025, net customer loans were RMB 111,900,229 thousand, with total ECL provisions of RMB 5,693,367 thousand Customer Loans Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Loans Measured at Amortized Cost | 117,393,334 | 103,725,354 | | Less: Loan Credit Loss Provisions Measured at Amortized Cost | (5,693,367) | (5,342,538) | | Loans (Bill Discounts) at Fair Value Through Other Comprehensive Income | 200,262 | 202,219 | | Net Customer Loans | 111,900,229 | 98,585,035 | Financial Investments - Credit-related Financial Assets As of June 30, 2025, credit-related financial investments totaled RMB 2,803,825 thousand, primarily corporate loans via trust and asset management schemes Financial Investments - Credit-related Financial Assets Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trust and Asset Management Schemes | 2,903,598 | 2,449,967 | | Less: Expected Credit Loss Provisions | (257,272) | (513,551) | | Total | 2,803,825 | 2,110,510 | Financial Investments - Financial Assets at Fair Value Through Profit or Loss As of June 30, 2025, FVTPL financial assets totaled RMB 35,550,571 thousand, with unlisted assets, particularly short-term financing and commercial bank bonds, as the main components Financial Investments - Financial Assets at Fair Value Through Profit or Loss Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Listed Outside Hong Kong | 5,343,561 | 6,048,815 | | Unlisted | 30,207,010 | 26,690,603 | | Total | 35,550,571 | 32,867,602 | Unlisted Financial Assets Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Short-term Financing Bonds | 10,033,870 | 4,069,953 | | Commercial Bank Bonds | 9,240,839 | 7,495,494 | | Fund Investments | 5,125,284 | 9,725,797 | | Total | 30,207,010 | 26,690,603 | Financial Investments - Financial Assets at Fair Value Through Other Comprehensive Income As of June 30, 2025, FVOCI financial assets totaled RMB 4,617,080 thousand, with unlisted assets, particularly government and local government bonds, as the main components Financial Investments - Financial Assets at Fair Value Through Other Comprehensive Income Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Listed Outside Hong Kong | 45,869 | 478,718 | | Unlisted | 4,498,825 | 2,773,642 | | Total | 4,617,080 | 3,349,139 | Unlisted Financial Assets Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Government Bonds | 2,007,882 | 1,246,036 | | Local Government Bonds | 1,826,881 | 213,945 | | Policy Bank Bonds | 437,084 | 1,043,228 | | Total | 4,498,825 | 2,773,642 | Financial Investments - Financial Assets at Amortized Cost As of June 30, 2025, net financial assets at amortized cost totaled RMB 20,638,532 thousand, with unlisted assets, particularly policy bank and government bonds, as the main components Financial Investments - Financial Assets at Amortized Cost Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Listed Outside Hong Kong | 2,593,594 | 2,701,168 | | Unlisted | 18,213,075 | 17,009,362 | | Less: Expected Credit Loss Provisions | (581,941) | (577,495) | | Net Amount | 20,638,532 | 19,564,015 | Unlisted Financial Investments Composition (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Policy Bank Bonds | 10,783,165 | 11,341,242 | | Government Bonds | 3,437,623 | 2,133,428 | | Collective Trust Schemes | 1,924,828 | 1,758,196 | | Total | 18,213,075 | 17,009,362 | Investments in Associates As of June 30, 2025, investments in associates totaled RMB 58,524 thousand, primarily in Luxian Yuantong Rural Bank, with a 30% stake - As of June 30, 2025, investments in associates totaled RMB 58,524 thousand[278] - The bank invested in Luxian Yuantong Rural Bank on April 8, 2009, holding a 30% stake[279] - The share of profit after tax for the current period was RMB 982 thousand[278] Property and Equipment As of June 30, 2025, net book value of property and equipment was RMB 1,069,651 thousand, with buildings as the main component Property and Equipment Net Book Value (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Buildings | 641,115 | 662,180 | | Electronic Equipment | 53,526 | 66,370 | | Construction in Progress | 349,862 | 298,682 | | Total | 1,069,651 | 1,054,569 | Deferred Income Tax As of June 30, 2025, net deferred income tax assets totaled RMB 1,628,913 thousand, mainly from asset impairment provisions and employee compensation Deferred Income Tax Assets and Liabilities Composition (RMB thousand) | Item | June 30, 2025 Deferred Income Tax Assets / (Liabilities