OCFT(OCFT) - 2022 Q4 - Annual Report

Foreign Currency and Financial Risk Management - The company is primarily exposed to foreign currency risk from USD/RMB exchange rate fluctuations, managing this risk through spot-forward derivative financial instruments [877]. - Interest rate risk is mainly associated with term deposits and short-term borrowings, all maturing within one year, with management strategies in place to match interest rate terms [879]. - The company mitigates credit risk by transacting with state-owned or reputable financial institutions, assessing credit quality, and implementing shorter credit periods [881]. - Liquidity risk is managed by maintaining adequate cash reserves and monitoring cash flows, ensuring sufficient funds for working capital and capital expenditures for the next 12 months [883]. - The company has developed independent procedures to review credit applications and manage credit risk on a portfolio basis, with annual limits approved by management [882]. Impact of COVID-19 on Credit Assets - In 2022, the quality of credit assets was impacted by COVID-19, prompting the company to enhance prudential management and technological empowerment [880]. Public Offerings and Financial Proceeds - The company completed its initial public offering in December 2019, issuing 31,200,000 ADSs, raising approximately US$311.0 million in net proceeds [897]. - In August 2020, the company completed a follow-on offering of 20,700,000 ADSs, raising US$372.6 million in net proceeds [898]. - A total of RMB1,499.1 million (US$217.3 million) was used for general corporate purposes from the proceeds of the public offerings [899]. - The company has not paid any of the net proceeds from its public offerings to directors, officers, or their associates [899]. - The follow-on offering included the full exercise of the underwriters' option to purchase additional ADSs [898]. - The initial public offering was underwritten by major financial institutions including Morgan Stanley and Goldman Sachs [897]. - The company intends to use the remaining proceeds from its public offerings as disclosed in its registration statements [899]. - The total number of ordinary shares represented by the ADSs issued in the initial public offering was 93,600,000 [897]. ADR Holders and Depositary Responsibilities - ADR holders are responsible for any taxes or regulatory charges related to their holdings, with the depositary having the right to deduct such amounts from distributions [892]. - The depositary may refuse services to ADR holders with unpaid fees or charges until such amounts are settled [890]. - The company did not receive any distributions from the depositary for the year ended December 31, 2022 [891]. Foreign Exchange Transactions - The company utilizes foreign exchange transactions to convert foreign currency into U.S. dollars, with rates determined by published benchmarks or third-party providers [888].