Q：When was China Construction Bank Corporation (“CCB”) formed?

 

A：Our history dates back to 1954, when the People's Construction Bank of China was founded as a wholly state-owned bank under the direction of the Ministry of Finance of the PRC to administer and disburse government funds for construction and infrastructure related projects under the state economic plan. In 1996, the People's Construction Bank of China changed its name to China Construction Bank and became a full service commercial bank. China Construction Bank Corporation was formed as a joint-stock commercial bank in September 2004 as a result of a separation procedure undertaken by our predecessor, China Construction Bank, under the PRC Company Law.

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Q：When was CCB listed?

 

A：H-shares of CCB were listed on the Main Board of the Stock Exchange of Hong Kong Limited on 27 Oct. 2005. A-shares were listed on Shanghai Stock Exchange on 25 Sep. 2007.

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Q：What is the ticker symbol for CCB and on which exchange does it trade?

 

A：H-shares of CCB are traded on the Main Board of the Stock Exchange of Hong Kong Limited under the ticker symbol “939”. A-shares are traded on Shanghai Stock Exchange under the ticker symbol “601939”.

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Q：Who is the Company’s Share Registrar?

 

A：The Company’s Share Registrar is Computershare Hong Kong Investor Services Ltd. Below is their contact information:

46/F., Hopewell Centre

183 Queen’s Road East

Hong Kong

Tel. No. (852)2862-8628

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Q：How many shares are there in one block of CCB shares?

 

A：There are (1,000) shares in one block H-shares and (100) shares in one block A-shares of CCB.

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Q：Should I contact your company in cases of loss of share certificate, change of beneficiary owners name and / or address, transfer of shares, etc.?

 

A：For matters relating to your shareholdings with our company, please contact our company’s Share Registrar the contact details of which is shown above.

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Q：How could I find out when CCB would announce its financial results?

 

A：You may refer to Corporate Calendar under Investor Relations to find out all upcoming events.

 

  Q.   Responses to Shareholders’ Recent Questions

  A.      

CCB made good headway in tapping New Finance and achieved fruitful results in 2019

Over the past year, in the face of the complex situation of rising risks and challenges at home and abroad, CCB earnestly implemented the important directives of President Xi Jinping on financial reform and development. In line with the requirements of the country’s macro-economic and financial policies, the Bank responded calmly to these risks and challenges, adhered to good practices and pursued innovation, strengthened the “Three Capabilities” while serving the real economy, forged ahead the “Three Major Strategies” while supporting social development, promoted the financial supply-side structural reform and embarked on the journey of the “Second Curve” with New Finance actions. The stable improvement in bank-wide business growth and operating performance has come along with the all-out efforts to support the economic and social development and satisfy the people’s increasing financial needs.

Adhering to the original mission of serving the real economy and backing the supply-side structural reform. CCB capitalized on its traditional strengths to actively support major national development projects. At the end of 2019, the loans to infrastructure sectors were RMB3.68 trillion, up 6.5% over the previous year. To support the country’s major initiatives on development of key regions, we increased the amount of corporate loans to the Guangdong-Hong Kong-Macao Greater Bay Area, the Yangtze River Delta and the Beijing-Tianjin-Hebei region by 19.0%, 9.8% and 12.3% respectively. We accelerated the restructuring of existing financial assets, the optimization of incremental financial assets and the transformation of growth drivers, and actively served the financing needs in sectors including advanced manufacturing, energy conservation and environmental protection, and services concerning people’s livelihood. The loans to strategic emerging industries, green finance and loans to private enterprises grew by 38.4%, 12.8% and 14.2% respectively. Debt-for-equity swaps amounted to RMB314.6 billion, continuously leading the market.

House rental business progressing on all fronts and the chain reaction of the business continuously expanding. We gradually established online channels for the house rental platform, with a total of over 20 million properties listed online. The “house deposit” business accelerated the revitalization of idle housing resources, and the number of contracted apartments exceeded 800,000 units on a cumulative basis. The “Digital Real Estate” system has helped enhance the management of the residential construction sector, and has been promoted to more than 40 cities across the country. With the additional supply of houses, including the Jianrong apartments for long-term leasing and new residences in urban villages, we helped more people realize their dreams of having a home to settle down.

Promoting inclusive finance across the board and leading the market with innovative models. CCB reported a total balance of inclusive loans of nearly RMB1 trillion for over 1.3 million customers. We continued to optimize the “Huidongni” platform and enhance the credit service experience. The mix of online products featuring new models like the “Quick Loan for Small and Micro Businesses” series was continuously enriched, with a loan balance of more than RMB590 billion. We implemented intelligent risk control over these products which yielded marked results while ensuring the high-quality development of inclusive finance business. We continued to expand the scope of inclusive finance. With over 600,000 inclusive finance service outlets of “CCB Yunongtong”, we have basically covered all administrative villages across the country. We launched the “Mingonghui” platform with innovative application of blockchain and big data, which has served over four million customers on a cumulative basis.

Empowering with FinTech solutions which continuously created spillover effects. With a consolidated FinTech foundation, CCB actively promoted the development of FinTech-based platforms including AI, blockchain and Internet of Things, and continuously introduced innovative financial products and services to enhance customer experience. We have developed collaborative smart finance solutions to promote the enhancement of internal digital operation and management capabilities. To empower external partners with the concept of openness and sharing, we have built a new ecosystem for Government, Business and Customer communities. Moreover, we created a smart government affairs service platform and promoted the platform in over 140 counties, cities and provinces to facilitate the modernization of social governance system.

The “Workers’ Harbours” project was fully launched, creating strong social resonance. Upholding the concept of openness and sharing, CCB provided outdoor workers and other general public with a more comprehensive and more caring suite of services and facilities for the convenience of the people. With a total of 14,300 service outlets, we have served workers over 100 million times on a cumulative basis. The “Workers’ Harbours” project was awarded the “Service Station for Outdoor Workers”, the first co-developed brand granted by the All-China Federation of Trade Unions. The Bank released the “Workers’ Harbours” APP which aimed at enriching the service content for the benefit of the people.

Seeing all-round development of CCB University and extensive promotion of “industry-education integration”. CCB built an online & offline open education and training platform, integrating internal and external education and training resources and covering domestic and overseas institutions. We established the Industry-Education Integration Alliance for New Financial Talents with a shared vision. While standardizing and deepening the training of employees’ comprehensive skills, we expanded the “Financial Literacy Promotion” Project for the general public and provided external training sessions with a total attendance of 1.35 million. We organized the “Summer Practice in Rural Areas for Ten Thousand Students”, which set up a scenario for college and university students to become familiar with the new rural development in the new era.

While exploring New Finance, we have gradually formed a new business model: capturing opportunities from solving pain points in the society and serving the people’s livelihood, pursuing technological innovation, serving consumer needs, building the ecosystem, attracting a new generation of customers, expanding the sources of income and undertaking social responsibilities. Practice has proven that the New Finance action powered and elevated the Bank’s business development and operating performance: At the end of 2019, the Group’s total assets reached RMB25.4 trillion, an increase of 9.5% over 2018; deposits and loans totaled RMB18.4 trillion and RMB15.0 trillion, up 7.4% and 9.0% over a year ago; net profit was RMB269.2 billion, an increase of 5.3% over 2018; return on average assets was 1.11%, return on average equity was 13.18%, and profitability maintained the leading position among domestic and international peers; non-performing loan ratio dropped to 1.42%, and asset quality remained stable with steady improvement; total capital ratio was 17.52%, providing a firmer foundation for development.

CCB fulfilled the responsibilities as a large bank while adhering to its original mission, and made progress on all fronts while serving the economy and society. We delivered a stable, balanced and high-quality performance to all the shareholders. According to the 2019 profit distribution plan approved at the Annual General Meeting, CCB maintained a 30% dividend payout ratio in spite of the current complex situation. The cash dividend of RMB0.32 per share marked a 4.6% increase over the prior year.

CCB took on financial responsibilities in the battle against COVID-19 and maintained stable development

Since this year, the sudden outbreak of the COVID-19 pandemic has brought unprecedented challenges to the economy and society. The pandemic prevention and control of CCB and our business development amid the outbreak have all along been a concern of our shareholders. We unswervingly implemented the decisions and plans of the Party Central Committee, took the initiative and acted swiftly to cope with the challenges brought about by the pandemic, earnestly took on and fulfilled responsibilities and strove to support the battle against the pandemic and the economic and social development with technology-enabled, well-targeted financial services. At the same time, we also realized the stable growth of the business indicators.

Swiftly implemented the directives and formulated deployment actions. We set up a leading task force for COVID-19 prevention and control immediately after the outbreak, and took the lead in introducing “Ten Measures” of financial services and “Twenty Rules” for pandemic prevention and staff caring in our outlets. We quickly started the emergency plan, rolled out a flexible work system, provided our employees with anti-pandemic materials such as masks and disinfectants, and helped to maintain the safety and health of our employees and their families while preventing disruptions in financial services. Moreover, taking the initiative to assume social responsibilities, CCB searched for medical supplies from multiple sources via its domestic and overseas institutions and donated them to relevant medical organizations and communities in Hubei and other affected areas to assist the frontline in the fight against the pandemic. We provided free insurance coverage and hospitalization allowance to health workers in Hubei and those going to Hubei to lend assistance via our subsidiary CCB Life, and mobilized all our employees to donate money and materials to support the battle against the pandemic.

Providing assistance to the frontline and fully satisfying the funding needs of key sectors. We implemented differentiated credit policies, released 26 special measures for supporting Hubei and gave a sufficient amount of credit support to those enterprises which were temporarily experiencing hardships due to the pandemic. We established a “Green Channel” for loan approval to respond quickly to emergency needs, and swiftly provided credit support to the construction of Huoshenshan and Leishenshan, two coronavirus hospitals. We focused our efforts in supporting the credit needs of enterprises working on pandemic prevention and control and cumulatively granted more than RMB100 billion loans to these enterprises since the outbreak.

Applying technology in the fight against COVID-19 to enhance digital prevention, control and governance capabilities. We vigorously promoted digital operations and services by virtue of our technical strengths and exported technologies to empower local government departments, enterprises and public institutions. We promoted the government’s “Anti-virus Health Code” and developed an online anti-virus supplies assurance management system. With the smart government affairs service platform for 144 counties, cities and provinces, we made it possible to inquire and handle nearly 400,000 matters online and rolled out the pandemic prevention and control service functions on the platform. We released the “Smart Community Management Platform” which covered 2.46 million communities and 50 million corporate users. CCB opened a free-of-charge, real-time rescue platform in conjunction with professional medical institutions, introduced the “Online Vegetables Basket” service, provided the public with the online “anti-virus lectures” through CCB University, and helped the rural areas to combat the pandemic through more than 600,000 service outlets of “Yunongtong” nationwide.

Working in solidarity to assist and support pandemic prevention and control abroad. Since March when domestic pandemic prevention and control became stable and the spread of the coronavirus accelerated across the world, CCB has taken the initiative to shoulder responsibilities at the call of the government and actively donated anti-virus materials to the localities of overseas institutions while guiding these institutions to control the pandemic and strengthen employee protection. A “Special Column on Global Anti-virus Supplies” was established in the international version of the “Intelligent Matching Platform for Enterprises”, aimed at bridging the supply and procurement demand of anti-virus materials at home and abroad. Furthermore, we provided “green channel” credit support, free-of-charge cross-border settlement, low-cost trade finance and other supportive financial services for the export of these anti-virus materials. CCB fights the pandemic hand in hand with people from around the world and overcome the difficulties together, which is a profound demonstration of building a community of shared future for mankind with real actions.

Promoting the resumption of work and production and making every effort to help ensure stability on the six fronts and security in the six areas. CCB actively supported key areas of the national economy and people’s livelihood, and increased the credit support to key enterprises in the railway, civil aviation, power and energy sectors. To precisely shore up the weak links of the real economy, we launched “four mechanisms” and “eight measures” to serve small and micro enterprises. We further reduced the financing costs of small and micro enterprises, and helped tens of thousands of enterprises experiencing hardships to pull through with measures such as extension of loan terms and loan renewal. We served the transformation and upgrade of the manufacturing industry and supported the accelerated development of strategic emerging industries. We fully expanded the supply chain financial business, and strove to accelerate the recovery of industrial and supply chains. We supported the reopening of merchants and household consumption and increased the granting of credit card and consumer loans. We stepped up the promotion of online trade finance service and provided sound services for export-oriented enterprises.

It can be said that COVID-19 is a comprehensive stress test on the operation and management of CCB. Relying on the support of advanced technology systems, perfect management mechanism and digital business model, the Bank’s businesses ran smoothly with good development momentum. During the period of pandemic control, our employees were able to remotely handle business and credit approval to ensure the smoothness and stability of day-to-day operations; they were able to provide various financial products and services online to accurately support our customers and offer solutions; they were able to coordinate well the business arrangements and solidly promote peak season marketing through well-devised remote office and conference systems. This has also strengthened our confidence and determination to further deepen our FinTech strategy and accelerate the digitalization of operations. At the same time, CCB adhered to its prudent business philosophy, actively assessed the impact of the pandemic, reinforced active risk prevention and control, enhanced sustainable development and the capability to fend off risk, promoted stable asset quality, further improved the loan loss reserve ratio, and maintained it at a high level versus internationally comparable peers, thereby laying a solid foundation for stable, balanced and sustainable development. At the end of the first quarter, CCB reported total assets of RMB27.1 trillion, up 6.6% from the beginning of the year; deposits and loans were RMB19.7 trillion and RMB16.0 trillion respectively, an increase of 7.3% and 6.4% from the beginning of the year; net profit for the quarter was RMB80.98 billion, of which net profit attributable to equity shareholders of the Bank was RMB80.86 billion, up 3.9% and 5.1% year-on-year respectively.

Identifying, responding to and pursuing changes; opening up new horizons amid a changing environment

So far, China has achieved major strategic outcomes in combating the pandemic under the strong leadership of the Party Central Committee and thanks to the concerted efforts of all the Chinese people. However, the pandemic is still rampaging through the rest of the world, disrupting international economic and trade activities as well as industrial and supply chains, posing downside economic risks and bringing new challenges to the operations management of CCB. During the two sessions, President Xi Jinping prescribed endeavors to “cultivate new opportunities in crisis and open up new horizons amid drastic changes”, setting the direction for us to cope with the current complex environment. Consistent with the government’s policies and plans and the economic and social development requirements, CCB will apply FinTech to bring its distinctive advantages into play, make all-out efforts to support and serve the normalized pandemic prevention and control as well as the resumption of work and production, galvanize the smooth completion of the tasks of ensuring stability on the six fronts and security in the six areas, assist the alleviation of poverty and the building of a moderately prosperous society in all respects, and make steady and long-term progress while undertaking and fulfilling responsibilities.

Solidying the foundation with prudent operation and facing up to new challenges. Many international institutions have predicted a global recession in this year and a substantial slowdown of the Chinese economy. In spite of the risks and challenges, CCB will adhere to prudent operation, continue to reinforce digital, intelligent and intensive risk control, maintain ample liquidity, play well the “stabilizing” role as a large bank and timely analyze and respond to the volatility in domestic and foreign financial markets to ensure steady operation of its businesses.

Examining the situation with a development outlook and identifying the main thrusts. CCB will continue to carry out the directives of President Xi Jinping and the spirits of the two sessions, further enhance our stance and grasp the general trend, focus on the priorities of economic and social development and endeavor to provide agile, effective, precise and well-targeted financial services. We will proactively serve the new infrastructure and new urbanization initiatives and other major projects; actively support the development of digital economy, intelligent manufacturing, life and health, new materials and other strategic emerging industries; double the efforts to serve the strategy of expanding domestic demand and financially empower the gradual creation of a new development pattern where domestic and foreign markets can boost each other, with domestic market as the mainstay. With a focus on the tasks of ensuring stability on the six fronts and security in the six areas, we will provide innovative financial services and offer solutions, and promote the all-round development of our businesses while serving the economy and society.

Adhering to the development layout of New Finance and grasping new opportunities. While unswervingly serving the real economy and adhering to prudent operation, CCB will open up new horizons by grasping new opportunities and using the ideas, technologies, products and services of New Finance. We will forge ahead with the “Three Major Strategies”, increase the coverage and expand the portfolio of houses for rental, actively promote the development of the “house deposit” business, accelerate the duplication of mature models and scale up the new ecosystem of house rental; leveraging technology and digital platforms, we will further expand the scope of services for inclusive finance, support the recovery of small and micro enterprises, the quicker restoration and improvement of industrial and supply chains, the alleviation of poverty and vitalization of rural areas, and make new breakthroughs in New Finance; we will get closer to the ecosystem scenarios, deepen internal and external empowerment, promote digitalization and take FinTech to new heights. We will continue to address customer needs by bringing forth innovative products and services, reengineer the business processes and business formats and foster the digital business capabilities in a data- and technology-driven way. We will make overall planning and promote high-quality and sustainable development with new Finance actions in an effort to draw the “Second Curve” of CCB.

CCB remains long committed to “creating greater value for shareholders”. At this crucial moment when COVID-19 prevention and control becomes normalized and the national economy is recovering at a faster speed, CCB will, under the care and support of our shareholders and investors, actively play the role as a large bank, support the growth of real economy, provide customers with high-quality services and superb experience while achieving sustainable development. We will also take consideration of the medium- and long-term value creation for our shareholders. In return to our shareholders for their trust and support, we will make endeavors to enhance the long-term investment value of CCB through delivering stable, balanced and sustainable business results.

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Q.   Do you hold Shareholders Meetings?

 

A.   CCB holds Shareholders Meeting every year and all shareholders will be invited to attend the Annual General Meeting (AGM).  If there is any important issue that needs to be decided upon before the next AGM, shareholders may be called to an Extraordinary General Meeting.

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Q.   When will the next AGM be held?

 

A.    Please refer to our Corporate Calendar for upcoming events and date.

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Q.    Am I eligible to vote in the AGM if my shares are deposited with the Hong Kong Securities Clearing Company Limited?

 

A.    If you would like to attend the AGM in person and your shares are deposited with the Hong Kong Securities Clearing Company Limited, your must obtain a proxy form duly signed by HKSCC appointing you as a proxy.  You may contact your stockbroker for further assistance.

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Q.    Can I vote in the AGM if I could not attend the AGM?

 

  A.    CCB will send you a proxy form before the meeting. If you would like to vote on each of the resolutions, you can either nominate a representative to go to the AGM and vote on your behalf.  Alternatively, you may indicate whether you vote for or against each of the resolutions due to be decided at the AGM on the Proxy form.

 

Q.    Where can I obtain some financial information about CCB?

 

A.    You may click on Financial Highlights under Investor Relations to view the financial information about CCB or you can click onto Annual and Interim Reports to obtain a detailed financial report of the company.

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Q.    Who are the external auditors of CCB?

 

A.    Ernst & Young Hua Ming LLP as the domestic accounting firm of CCB and the onshore subsidiaries, Ernst & Young as the international accounting firm of CCB and the offshore subsidiaries.

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Q.    Does CCB have an audit committee to monitor the company’s financials?

 

A.    The Board of Directors has set up 5 specialised Board Committees and one of them being the Audit Committee.  You may click on Board of Directors under Corporate Governance to find out about the name of the committee members and their responsibilities.

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Q.    When does CCB report its financial results?

 

A.    You may click on Corporate Calendar under Investor Relations for upcoming events and dates.

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Q.    Is the result announcements presentation available for viewing?

 

  A.    You may click on Results Announcements and Presentation under Investor Relations for result announcements presentation.  

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  Q.   Main measures for supporting pandemic prevention and control and assisting economic and social development

  A.    

Since the beginning of the year, the sudden outbreak of COVID-19 has brought unprecedented challenges to the economy and society. CCB proactively responded to challenges arising from the COVID-19 pandemic, conscientiously discharged its responsibilities as a large bank, strove to promote pandemic prevention and control and serve the coordinated development of Chinese economy and society based on digitalised operating models.

Quickly sprang into actions and implemented the directives. After the outbreak emerged, CCB immediately set up a leading group on pandemic prevention and control, and took the lead in introducing "Ten Measures" of financial services and "Twenty Rules" for pandemic prevention and staff caring in its outlets. CCB has given full support to Hubei and Wuhan, the main battlefields of the pandemic. Domestic and overseas institutions of CCB gathered supplies from multiple sources to support front-line personnel combating the pandemic. Through its subsidiary CCB Life, CCB provided free insurance coverage and hospitalization subsidies to Hubei medical workers and those from other provinces participating in the fight against the pandemic in Hubei, and offered free "COVID-19 Prevention Insurance" to frontline workers nationwide combating the pandemic. CCB mobilized its employees to actively support the fight against the pandemic. Since the outbreak, CCB has made over RMB250 million in donations and contributions in kind.

Increased credit support and gave precision assistance in upholding stability on the six fronts and security in the six areas. CCB increased support to meet funding demands in fields relating to pandemic prevention and control. During the first quarter of 2020, loans granted to domestic enterprises engaged in pandemic prevention and control totaled RMB96.9 billion. In securing key areas concerning the national economy and the people's livelihood, CCB increased credit support to key enterprises and major infrastructure projects in sectors such as railway, civil aviation, power and energy, etc. Leveraging its advantages in comprehensive financial services, CCB provided support for the coordinated resumption of work and production of industrial chain and supply chain enterprises through its network supply chain financing service. In supporting the reopening of commercial businesses and household consumption, CCB increased lending in credit cards and personal loans. It also initiated the establishment of a RMB5 billion fund for the battle against the pandemic and stable development, mobilizing social capital to actively participate.

Adopted differentiated credit polices to help enterprises overcome difficulties. CCB offered preferential interest rates to loans newly granted to inclusive small and micro enterprises and reduced the lending rate to no more than 4.5%p.a.. For industries relating to pandemic prevention and control, CCB further reduced the annual lending rate by 0.4 percentage point. CCB established a green channel for loan approval to quickly respond to emergency needs. It launched exclusive products such as "Yunyi Loan". CCB rolled out 26 special support measures for Hubei, giving sufficient credit support to enterprises who were temporarily experiencing hardships due to the pandemic.

Enhanced digital prevention and control and governance capabilities in the fight against the pandemic through technology. CCB adopted the national "Epidemic Prevention Health Code" and added the epidemic prevention and control service function on its smart government service platform. It launched the “CCB Smart Community Management Platform", providing a coverage of 2.46 million urban communities, villages and enterprises, and over 50 million users by the end of April. In cooperation with specialized internet medical institutions, CCB established the "COVID-19 Real-time Assistance Platform". It launched the "Online Vegetables Basket" service to help merchants run business online and make it convenient for residents to shop at home. Through 610,000 "Yunongtong" service outlets in more than 500,000 towns and administrative villages across China, CCB promoted pandemic prevention and control and supported poverty alleviation in rural areas. Leveraging the advantages of CCB University in online training, CCB offered online "pandemic prevention classes" for the public. CCB promoted "online operation toolkit for enterprises" to assist enterprises in resumption of work and production.

With the spread of COVID-19 overseas, while ensuring pandemic prevention and control and employee protection, overseas institutions of CCB proactively donated pandemic prevention supplies to support the local fight against the pandemic. On the international version of the "Intelligent Enterprise Matching Platform", CCB established a special section for "Global Pandemic Prevention Supplies" to match domestic and overseas supply and procurement demand of pandemic prevention materials. For export of such materials, CCB provided "green channel" credit support, free cross-border settlement, low-cost trade financing and other financial services support.

Next, the Group will pay close attention to the development of the COVID-19 pandemic and changes in macro-policy, continue to promote refined management, enhance digital operation, effectively satisfy customer demand, promote the orderly development of businesses, and firmly hold the bottom line of risk prevention and control, while supporting COVID-19 pandemic prevention and control as well as resumption of work and production, and making due contributions to the high-quality development of the economy. 

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  Q.   Earnings in Q1 2020 and main influencing factors

  A.    

In the first quarter of 2020, the Group reaped net profit of RMB80,981 million, up 3.92% over the same period last year. The main factors are as follows:

Net interest income was RMB133,499 million, up 6.74% over the same period last year. The stable growth of interest-earning assets offset the year-on-year decrease in net interest margin.

Net fee and commission income was RMB45,376 million, up 5.45% over the same period last year, which was mainly attributed to increased deployment of online products, driving key fee-based business products to grow rapidly.

Other net non-interest income (International Accounting Standards) was RMB7,530 million, down 29.76% from the same period last year, which was mainly due to the impact of the pandemic. The fluctuations in financial markets resulted in changes in valuation of relevant assets.

Operating expenses (International Accounting Standards) were RMB38,887 million, down 1.28% from the same period last year. Cost-to-income ratio (International Accounting Standards) decreased by 1.02 percentage points to 20.16% over the same period last year. Asset impairment losses were RMB49,167 million, up 12.78% over the same period last year.

The Group will adhere to the general principle of pursuing progress while ensuring stability and the new development philosophy; spare no effort in providing financial services support for ensuring pandemic prevention and control and maintaining stable economic operation and social development; steadily advance the “Three Major Strategies” of house rental, inclusive finance and FinTech; effectively invigorate the “three communities”, i.e. the government (G-community), businesses (B-community) and customers (C-community); strengthen refined management; gather forces to improve quality and efficiency; enhance comprehensive and proactive risk management; strive to overcome the impact of the coronavirus pandemic and realize stable, balanced development.

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  Q.   Loans in Q1 2020 and key allocation areas

  A.   

The Group actively addressed challenges brought by the pandemic, increasing efforts in granting of credit loans, focusing on promoting pandemic prevention and control and serving the coordinated development of Chinese economy and society. As at the end of the first quarter of 2020, the Group's gross loans and advances to customers were RMB15.98 trillion, up 6.39% over the end of last year.

Corporate loans and advances were RMB8.73 trillion, up 9.93% over the end of last year. They were mainly granted to key areas such as infrastructure and inclusive finance. By increasing credit granting, CCB effectively supported pandemic prevention and control. During the first quarter, it granted a total of RMB96.9 billion to domestic enterprises engaged in pandemic prevention and control. Following closely national key strategic projects, CCB increased efforts to serve the credit demands of the Beijing-Tianjin-Hebei Region, the Guangdong-Hong Kong-Macao Greater Bay Area and the Yangtze River Delta. (At the end of 2019, loans to the infrastructure sectors reached RMB3.68 trillion, up 6.49% over the beginning of 2019; inclusive finance loans amounted to RMB963,155 million, up 57.88% over the beginning of 2019; loans to strategic emerging industries were RMB533,551 million, up 38.38% over the beginning of 2019.)

Personal loans were RMB6.71 trillion, up 2.43% over the end of last year. Credit card loans and personal housing loans grew steadily. (At the end of 2019, personal housing loans were RMB5.31 trillion, up 11.60% over the beginning of 2019; credit card loans were RMB741,197 million, up 13.79% over the beginning of 2019.)

Discounted bills were RMB499,073 million, up 1.29% over the end of last year. Such notes were mainly used to support enterprises' short-term capital turnover needs.

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  Q.   Inclusive finance loans

  A.   

At the end of 2019, the Group’s inclusive finance loans were RMB963,155 million, up 57.88% over the beginning of 2019; the number of inclusive finance loan borrowers reached 1,325,100, an increase of 307,200 over the beginning of 2019; interest rate of loans to inclusive small and micro enterprises granted within the year was 4.95%.

The Group adhered to its platform-based operation. Guided by the development concept of "digitalisation, platform, ecosystem and empowerment", the Group continuously explored new, smart and eco-friendly modes for inclusive finance, promoted digital precision marketing and carried out digital, whole-process, refined risk management and control, which has ensured high-quality development of its inclusive finance business. As at the end of 2019, new mode products represented by “Quick Loan for Small and Micro Businesses” amounted to over RMB1.7 trillion on a cumulative basis, benefiting nearly 1.03 million small and micro businesses.

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  Q.   Development of deposit business in Q1 2020

  A.   

The Group achieved good deposit growth through the implementation of  digital operation and active peak season marketing.

As at the end of the first quarter of 2020, deposits from customers of the Group were RMB19.71 trillion, an increase of RMB1,340.5 billion or 7.30% over the end of last year; its proportion in total liabilities was 79.54%, up 0.38 percentage point over the end of last year. In terms of deposit mix:

Time deposits were RMB8.72 trillion, an increase of RMB694,185 million or 8.65% over the end of last year; demand deposits were RMB10.77 trillion, an increase of RMB634,938 million or 6.26% over the end of last year.

Personal deposits were RMB9.78 trillion, an increase of RMB865,051 million or 9.70% over the end of last year; corporate deposits were RMB9.70 trillion, an increase of RMB464,072 million or 5.02% over the end of last year.

The Group will proactively adapt to the situation, adhere to and improve the digital operation model and strengthen its systematic network-based deposit stabilizing and growth strategy in order to promote steady growth of deposit business throughout the year.

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  Q.   Net interest margin in Q1 2020 and main influencing factors

  A.   

In the first quarter of 2020, the net interest margin (NIM) of the Group was 2.19%, down 10 basis points from the same period last year.

The main positive factor was the decrease in interest cost of other interest-bearing liabilities such as interbank deposits and debt securities issued. The main negative factors were increase in costs of general deposits, decrease in loan yield, falling yields in bond and money markets, and changes in asset-liability mix such as decline in proportions of general deposits, loans and bonds.

Affected by multiple factors such as the impact of COVID-19 pandemic, overall downward trend of market interest rates, steady implementation of loan interest rate liberalization and increased competition in deposit business, the Group's NIM is expected to face pressure in 2020.

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  Q.   Growth of fee-based business in Q1 2020

  A.   

The Group leveraged its advantages in FinTech and digital operation, analyzed customer demand in depth, seized market opportunities, increased deployment of online products, and accelerated the development of major fee-based business products.

In the first quarter of 2020, the Group realized net fee and commission income of RMB45,376 million, up 5.45% over the same period last year. Commission on trust and fiduciary activities saw rapid growth, and settlement and clearing business and bank card business, etc. grew steadily.

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  Q.   Investment in FinTech and achievements

  A.   

The Group continued to increase investment in FinTech. In 2019, the Group's investment in FinTech was RMB17,633 million, accounting for 2.60% of operating income (International Accounting Standards). At the end of 2019, the Group had 10,178 technological personnel, accounting for 2.75% of the Groups’ total headcount. In 2020, the Group plans to arrange a total budget for investment in fixed assets of RMB19 billion. Promoting innovation in FinTech and development of new operation models are one of the key focuses of the budget arrangement.

The Group put forth effort to promote the construction of intelligent platforms. It built an enterprise-wide network and information security management system. It established a smart operation maintenance platform with real-time perception, intelligent decision-making and automatic control functions. It also built an AI platform which supports 18 components and covers 381 business scenarios. An Internet of Things platform was put in place to support the application of 5G+ intelligent banking, smart vault, and smart cash box.

The Group used its Fintech strengths to support business development. It built a “scenario-oriented, personalised and intelligent” model of new retail banking, new corporate banking featuring “seamless integration of transactional businesses and emerging businesses”, and “intelligent, efficient and stringent risk control” inclusive finance services. It also established a “comprehensive, intelligent, targeted, timely, proactive and prospective” risk control system.

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  Q.   Asset quality in Q1 2020

  A.   

The outbreak of COVID-19 has brought upon greater uncertainty to the operating businesses of banks. The Group actively evaluated the impact of the pandemic on business operation and asset quality, strengthened the level of refined process management, enhanced proactive risk prevention and control, and improved sustainable development and risk mitigation capabilities.

In the first quarter of 2020, the asset quality of the Group remained stable. The NPL ratio was 1.42%, staying flat compared to the end of last year. The capability to offset risks improved steadily. The ratio of allowances to non-performing loans was 230.27%, up 2.58 percentage points from the end of last year.

The Group will pay close attention to the development of the pandemic and changes in macro-policy, continue to promote comprehensive, proactive, and intelligent risk management, enhance credit governance capability, focus on asset quality control, strive to reduce the impact of the pandemic and ensure key indicators of asset quality are stable, balanced and sustainable throughout the year.

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  Q.   Dividends

  A.   

The Group determines the dividend payout ratio after taking into full account the capital accumulated, regulatory requirements on capital and reasonable investment return to shareholders.

The Group plans to pay an annual cash dividend for 2019 of RMB0.320 per share (inclusive of taxes) to all its shareholders. The total amount of cash dividend is RMB80,004 million, accounting for 30% of the FY2019 after-tax profit attributable to equity shareholders of the Bank on a consolidated basis.

The above-mentioned proposal has been reviewed and approved by the Board of Directors and will be submitted to the 2019 Annual General Meeting for consideration. If it is approved, dividends will be paid to holders of A- and H-shares whose names appear on the register of members of the Group at the close of the market on 9 July 2020. Cash dividends of A-shares for 2019 are expected to be paid on 10 July 2020, and cash dividends of H-shares on 30 July 2020.

 

 

Q.       Do you have a set of Corporate Governance in place?

 

  A.    Yes.  You may click on Corporate Governance under Investor Relations to find out more about CCB Corporate Governance.