New China Life Insurance Company Ltd.

Ladies and gentlemen, good afternoon. NCI 2025 Annual Results Announcement will officially start. Thank you for the investors, analysts, and friends from the media for your participation from online and offline platforms. I'm the host of the meeting. First, let me introduce the senior management participating in today's meeting. They are Chairman Ms. Yang Yucheng, Vice President Financial Principal, Mr. Gong Xinfeng. Vice President, Mr. Qian Hongbo. Vice President, Mr. Wang Yanwen. We also invited Mr. Chen Yijing, NCAAM president and NCAAM Hong Kong chairman to participate in the meeting. We also have the honor to invite the independent directors of the committee to participate online. This meeting is divided into two parts, the presentation and Q&A session. We will provide simultaneous interpretation. Let's move to the presentation part. Please welcome Ms. Yang Yucheng to introduce 2025 business performance of the company. Dear investors, analysts, and media friends, welcome to 2025 Annual Results Announcement of NCI. We thank you for your long-term support to our company. The year 2025 marks the final year of the 45-year plan, and it is also an extraordinary year for NCI. Facing a highly stressful and complex internal and external environment, all employees have worked hard throughout the year. Our business performance has reached new heights, building on a high base. Multiple core indicators such as total assets, gross return premium, EV net profit, share values, and total market value have all reached record highs, presenting the most outstanding performance since the company's establishment. The company's operation is characterized by excellent performance, optimal structure, rising value, stable returns, abundant vitality, and strong resilience. In 2025, the company's total assets was close to 1.9 trillion yuan, up by 12.2%. Growth rate and premium was 195.9 billion yuan, up by 14.9%. EV was 287.8 billion yuan, up by 11.4%. Non-profit was 36.3 billion yuan, up by 38.3%. The company attests to shareholder returns and share the fruits of its business development with investors. In 2025, the combined cash dividends of the company reached 2.73 yuan per share, totaling 8.5 billion yuan, up by 600 million yuan compared with last year, up by 7.9%. Since its listing 15 years ago, the company has distributed dividend to shareholders totaling 44.5 billion yuan. Relaying on excellent performance, our stock price has continued to strengthen through the year. With the increase leading the sector in both markets, the total market value surpassed 200 billion yuan. In 2025, the company's comprehensive strength reached a new level and achieved fruitful results. The operating revenue reached 157.8 billion yuan, up by 19% year-on-year. Net assets reached 111.5 billion yuan, up by 16%. RE reached 34.7%, up by 8.8 percentage points. New business value reached 9.8 billion yuan, up by 57.4%. NPV margin was 16.2%, up by 1.5 percentage points. The total investment yield was 104.3 billion yuan, up by 31%. Total investment yield was 6.6%, up by 0.8 percentage points. Our solvency has remained adequate. We have impact on our high quality development parts of growth in premium and value and optimization of structure and quality. Both premiums and business value have seen comprehensive growth. FYP from long-term business increased by 48.9%. FYRP rose by 36.7%. An NBA margin and EV have all achieved significant improvements. From structural perspective, FYRP and FYP exceeded 60%. Renewal premiums continue to play a stabilizing role. We have won the battle of transformation to power insurance. Power insurance proportion over our regular payment business increased quarter by quarter. In the fourth quarter, it reached 77%. 13-month persistence rate was 97.1%, up by 1.4 percentage points. 24-month persistence rate was 93.3%, increased by 7.1 percentage points. Surrender rate was 1.5%, decreased by 0.4 percentage points. The company's service to national strategy reached new heights. We improved our management system for serving national strategies, established special groups, and formulated implementation plan. We invested in serving the five major areas in finance exceeded 360 billion yuan. For inclusive finance, we improved inclusive finance products. Underrated 46 Huiminbao projects, investment in the inclusive field has reached 55.6 billion. About pension finance, the second and third pillars of pension have been vigorously developed. The total premium of the third pillar commercial insurance annuity exceeded 60 billion yuan. For technology finance, we provided over 1.2 trillion yuan in risk protection for 14,000 technology enterprises with investments reaching 140 billion yuan. The company has leveraged its patient capital advantage to support technological innovation. Our medium and long-term fund entering the market project was selected as an outstanding case in the 2025 CTV Finance. For green finance, the focus was on investing in areas such as green bonds and public rates for clean energy, with investment reaching 75.1 billion yuan. We have been awarded as an outstanding ESG case by the Publicity of Education Centre of the Ministry of Ecology and Environment. For digital finance, we supported for the development of digital industry enterprises, with investment balance exceeding 68 billion yuan. By 2025, we have fulfilled social responsibilities and demonstrated the commitment of a state-owned enterprise. New achievements were made in rural revitalization, with a total investment of over 17 million yuan. For nine consecutive years, a public welfare project to care for sanitation workers has been carried out, benefiting 6.7 million people. Resources will eventually be exhausted, but the culture endures and thrives. The 2025 was designed as the year for promoting the company's corporate structure. The company practiced a new era of corporate structure. Our corporate value is accomplished first, hard work as a foundation, openness and inclusiveness, and success in action. Our NCI professional and army spirit was professional and army pursuit of excellence, benevolence and virtue, inheritance and innovation. Through organizing honor evaluations, speech contests, special lectures, and lectures by renowned teachers, we have widely carried out 150 cultural promotion activities. among employees and agents, held the 2026 Agents Summit and rewarded outstanding teams and individuals under the inspiration of the corporate culture. Enthusiasm of employees is high, morale of the sales team is high, and coherence of the company has reached a new high. Our brand awareness and reputation has been improved. Sponsored has been real. Over 20 marathon events provided full support for Suzhou Super League and WTT table tennis tournament. Launched brand app PC Libo. Then trading a brand image that is substantial, grand, full of vitality and strength, with stable operation and outstanding service, the coherence and influence of the company culture has been enhanced, ranking among the Fortune Global 500 and Top 50 global life insurance companies. After more than two years of hard work, the company has made considerable and gratifying progress in all aspects. The dividend reform has been released. The momentum of value growth has been strong. Business structure has been optimized. Quality of development has been enhanced. Looking back at the development in the past year, we have carried out the following key tasks. We strengthened strategic planning and made systematic and in-depth arrangements, attach great importance to top-level design. In the beginning of last year, we initiated the formulation of the 15th Five-Year Plan on the basis of thoroughly analyzing market changes and industry transformation trends. After extensive research and three rounds of seminars, we proposed the development vision of building a first-class financial service group in China with insurance business at its core. We formed the three strategic lines, customer-centered, team-based, and employee-partner-oriented. We aim to provide enduring protection, better life, and greater health to customers, create a cause of great love, and fulfill the dreams of entrepreneurs for our team, strive for growth, consistently innovate and support, and realize the ideal of serving the country and the people of our employees, let better products, better services, and better life with NCI. We clearly focus on the coordination of the three fronts, promote reform and innovation, Moving towards the direction set by our strategy, centering on strategic main lines, deepening and solidifying the coordinated development of insurance plus service plus investment, and further promoting professional and market-oriented systematic reform, launched a series of combined measures for reform and development, one initiative in market completion. Firmly grasped the flagship products, promoted transportation to power products. We made efforts to optimize our business structure. We have established a dedicated team with highly With highly competitive products and driving force, we provided systematic support for the transformation in terms of team training, ecological collaboration and assessment guidance. Over the past year, the company's power insurance has been gradually made breakthrough and reached a favorable state, achieving a FYP of 11.9 billion yuan. increased nearly 12 times year-on-year. Substantial and significant progress has been made in product transformation. We will make an effort to enhance the competitiveness of our products, establish a diversified product matrix centered on customers and covering the entire life circle, enrich a variety of wealth management products and pension products, launch innovative products such as Yiyao Wuyou and Kanghu Wuyou, Deeply integrated insurance claim settlement with medical service and nursing services achieve a transformation from traditional claim settlement to product service ecosystem. Adhering to the concept of financial people, we improved the inclusive product system, launched over 20 inclusive products and rural revitalization products, covering multiple groups, built a comprehensive, high-quality, and refined diversified product system. We did our efforts in China and team-building accelerating breakthrough in business transformation. In individual training, we have strengths in the system-based management and self-dependent operation. We advanced to build a high-performing team with strong units. Longtong Feng and the WRP entrepreneurship support team, these efforts have solidified the foundation for our team. We have built an ecosystem scenario and a benefit system. established a wide-stop digital marketing platform, deeper development of the new modern marketing concept of product plus service plus scenario plus technology. The company's FYP from long-term insurance in the individual channel grew by 43.8% NPV. grew by 19.4%. The workforce size stabilized. Average monthly comprehensive productivity per capita rose by 43%. We have elevated the Bank of China to a strategic level since the policy opportunity continue to deepen product transformation and team building. Based on significant optimization of cost structure, total bank premium reached 72.1 billion yuan, growing by 40%. FYP from long-term business reached 37.9 billion, up by 52%. MBV reached 5.27 billion, a substantial increase of 111%. The bank channel contribution to new business value has surpassed that of the individual channel, accounting for a significant share. We improved our service ecosystem and advanced the service empowerment system from scratch, from basic to excellent. Upgraded our five major service brands that cover the ten areas. This ecosystem is designed to deliver excellence in medical care, health management, senior living and cultural tourism, providing diversified personalized service to clients and families, enhance service capabilities and improving client engagement service. It covers over 4 million individuals with increasing awareness and usage. Through the development of this service ecosystem, we aim to upgrade the empowerment experience, guiding the team to transition from traditional marketing to the modern marketing concept of products plus service plus scenario plus technology. Help agents enhance their self-dependent operational capability and realize their entrepreneurial dreams. Increase our investment in AI and technology to enhance customer service capabilities. leveraging technology to empower operation, providing ultra-fast service to agents and clients. The company's one-minute completion rate for policy service stands at 96%. We paid out more than $42 billion in maturities and annuities over the year, and $14.7 billion in claims. We launched 11 large-model intelligent agents, and the NCI Digital Human Ambassador all have empowered service improvement and business growth. We have enhanced our investment research capabilities, built a comprehensive edge on the investment side, strengthening our ability to deliver enduring protection. In 2025, our total investment income reached 104.3 billion yuan. up by 30.9%. Total investment yield was 6.6%, up by 0.8%. Ranking among the industry leaders, the company improved investment, management, and asset liability coordination. We continue to improve investment, We expanded our team of investment professionals, cultivated and recruited outstanding talent, established an investment research allocation system capable of capturing policy, market and industry opportunities. We increased allocation to OCI, long-term equity investment, and PE, addressing the past shortcoming of having a bond base but lacking an equity base on the fixed income asset income. We invested in convertible bonds, bond fund rates, and other diversified assets, reducing negative interest rate spread and reinvestment risks. In response to the requirement of long-term capital to under-market, we established three pilot funds with China Life for a total contribution of 46.25 billion yuan. We strengthen the development of our investment ecosystem, enhance coordination with various institutions with good use of financial resources, reinforce investment risk management, control credit risk, market risk, optimize multi-layer risk buffer system, build robust investment management capabilities, striving to achieve excess returns on the basis of long-term stability. focus on strengthening foundation management to satisfy the company's high quality development. They are the powerful co-authors, clearing the role of head office for design, institution for execution, took the lead in strengthening strategic guidance, resource allocation, upgraded strong foundation project, committed to lay a solid foundation for long-term benefit, empower branches across six dimensions, help them upgrade and elevate their overall competitiveness, optimize resource allocation, launch the re-energizing talent initiative, improve talent allocation with a focus on efficiency, Establish a proper assessment evaluation system for branches and work diligently to enhance return on investment. Improve risk control system. Execute penetrating full coverage and integrate risk control framework. Refine authorization system. Achieve group level management goal of clear authority and responsibility. The year 2026 marks the beginning of the 15th February plan and the company's 30th anniversary. Demographic shift, technological innovation, industrial upgrading and transfer of household wealth allocation will accelerate transformation, imposing higher demand for the company's operations. At this starting point, We will keep in mind original aspiration and mission of finance for the people and for the country, take corporate culture as the soul, take strategic planning as the directional guide, seize market opportunities, improve the synergy across the three fronts, focus on core business, continue to deepen reforms, enhance our development capacity, and persistently build a powerful new kind of life. First, integrate and serve the broader national agenda. We will practice the big insurance philosophy, committed to the vision of becoming a first-class financial service group in China, with insurance at its core. Fulfill our social functions. Eject more patient capital into the strategy of achieving technological self-reliance and self-strengthening. expand the supply of pension finance, inclusive finance, accelerate digital transformation, focus on car business and strengthen our life insurance business, adhere to a value and profit-centered approach, optimize business mix and revenue structure, drive optimization of business and profit sources. Develop power insurance and other floating return products. Enrich the supply of long-term and health products. Create a close loop of health insurance and health management. Accelerate channel transformation and team development. Enhance the core component of life insurance business. Elevate organizational development to a strategic level. Enhance the value of Bank of China. Build an integrated online-offline internet ecosystem. Upgrade the profit model of group insurance business. Leveraging the powerful synergy of one NCI will transform the company's strength into market competitiveness. Establish a new model marketing concept and practice the new marketing model. enhance capabilities and standards in serving customers, build a service ecosystem that's more quality-driven and more closely aligned with customer needs, become a comprehensive financial service provider for customers. We will use our concrete action, put in practice the value proposition of finance for all the people, delivering enduring protection, better life and greater health. We will be a modern insurance company that's professional, warm, mission-driven, and worthy of long-term trust. Fifth, leverage the advantages of patient capital and long-term capital. We will optimize the asset allocation structure, improve the investment research system, build a multilevel investment portfolio, highly value asset allocation, enhance investment management, and elaborate coordination. cultivate long-term value creation, become true patient capital and high-end level capital. Six, remain committed to laying solid foundation for long-term benefit. We will build a stronger headquarter which will lead the branch office to become stronger. We will balance development and security stress and implementation improvement of risk control system. We will increase technology investment and reinforce full scenario AI empowerment. Going forward, we will adopt a courageous competitive stance and a spirit of striving for excellence. Pursue boundaries through innovation, enhance long-term competitiveness. achieve a solid start to the 15th five-year plan. The above is my presentation of the company's business performance. Thank you, Mr. Yang. Next, we move to the Q&A session. Due to time limit, each person is limited to two questions. Please let us know your name and the institution you work for.

Thank you for the presentation. I'm from Social Security. First, I want to congratulate on your performance last year. I have two questions. First is about the abilities. We can see you have reached record high last year, and I want to ask on a high base last year, how do you – comment on the growth expectation in 2026 and what is your product strategy. And also I want to ask about the participating insurance, what is your goal and plan for the transition to participating business. And the second question I want to ask about the asset. In the past three years, we are in a low-rate environment, and the net investment yield of the peer companies is going down, and I want to And we can see the total and the comprehensive U.S. and EU, the lead industry in 2025. And I want to ask the management team how do you view the interest rate and equity market, and what is your strategy in your asset allocation? Thank you for your question. First, let's see if I can answer your first question. Thank you. For 2025, we have yield remarkable results. The total GWP increased by 15%, FYRP grew by 15%, and in 2024 and 2025 has realized a very fast growth and laid a high base for our future growth, but we are confident on a high base we can maintain a steady growth. In 2026, we will further serve the national strategy and to embark on the road of high-quality growth road featured both value and volume growth and structure and quality improved and we will focus on the key areas that drive the value growth, speed up the channel development transition, and to consolidate our business capabilities. And in 2026, we will provide the best business performance to celebrate our 30-year anniversary and reward the trust of our customers and the support of the investors and all walks of the society. In 2026, we will stick to the customer-centered development strategy. For the individual insurance channel and the bankership channel, groups channel, as well as the internet channel, we will make full efforts, strengthen the combo sales of products to meet the diversified demand of the customers. In the past, we have done a good job in the sales of whole life insurance, and we are confident to make efforts in the sales of the participating and health insurance, and we will return to the assets of insurance to consolidate our business quality and to realize sound growth of both MBV and premium income. And more specifically about the product you definition, as well as the competition strategy, I want to emphasize the following. First, we will implement the new marketing concept of integrating the scenario, product, service, and technology by virtue of the high-quality medical resources. We will focus on the treatment, medical care, and nursing as the center and provide a multi-level tiered and diversified products combining the insurance products and the health service and we will combine the wealth management products with the aged care community and the tourism resources to build our insurance plus aged care community and also as I mentioned management strengthen the coordination to empower the floating benefit products. And in 2026 we will emphasize the sales of participating whole life insurance but this is not the sole product we will provide. We will also introduce measures to promote other wealth management products including the annuity insurance and health insurance and also we will fully leverage on the tax benefit policies and pension policies of the country and to introduce products and we will include the important products including the whole life annuity and the aged care pension products to include in the individual pension products and we will provide the whole life circle to whole life circle health solutions to customer including the prevention beforehand in process control and rehabilitating afterwards and will provide diversified product pipeline and we will seek the policy opportunities and the sales and provide and explore the products, including the participant health insurance, the consumption and medical care insurance, the specific medicines, the disability and the unit-linked products, et cetera. And about the transition to participant business, I want to emphasize in 2025, we have, we are we are determined in this transition and have a good start and for example in the sales we have made breakthroughs and in last year the sales of participating business is 12 billion and given that we haven't sold the participating business for many years and this is a hard-won result and especially in the third and fourth quarter last year we have strengthened our efforts and yield expected results. And on the other hand, in terms of our management system, we have effectively coordinated resources of the front and the back office and introduced incentive policies, trainings, products, publicity, compliance support, and asset liability matching measures to establish a sound management portfolio and a system for the future participating business. But in 2025 is just a beginning. We will continue our participating business transition focusing on the product portfolio expansion. For example, we will strengthen sales of annuity insurance products, strengthen the product innovation, and seek the policy opportunities of participating health insurance. And we will try to sell the right products to the right customers, avoid the misleading sales. And also we will try to coordinate the SLA ability measurement, and we will try to reward the customers with sound business performance and let the customers have a higher sense of gain and satisfaction. Thank you. This is my answer.

Thank you for your recognition for our business performance in 2025. Our total investment yield reached 6.6%. After considering some other indicators, we could make it to 6.9%. This is due to the fact that we have continued to uphold long-term and value investment values. Your question regarding two areas, first on the interest rate trend and second on the active market. First, about the trend in interest rate. We believe in short-term it will experience fluctuations. The credit spread will tighten, term spread will widen. Short-term funding conditions will be loose and have more certainties, but actual long-term bonds will more fluctuate. Long-term and short-term interest rates will diverge in low interest rate environment. How to get favorable returns? We need to consider the interest rate trend rightly. About active market, we have confidence for the medium and long-term development of China's capital market. We pay attention to three themes. First, up-performing sectors in up-circle. Second, those confronted to the national strategies, especially new productive forces. Third, high dividend. strategy in low interest rate environment. Based on the above judgment about the capital market for the SAA, we will carry out the following principles first. As a liability matching principle, we will think about the future of liabilities. Make sure the investment return can cover the liability cost. Second, we will continue to uphold diversified allocation philosophy in fixed income, equity, and alternative assets. We will make a rational structure. enhance the profitability elasticity. Second, return orientation. In the market fluctuations, we will pay attention to margin of safety, grasp phased opportunities, and bring sound investment returns to customer and customers. The uncertainty in macro environment and financial market will pose both challenges and opportunities to the company. We will follow the macroeconomic changes and policy changes, we will seem to bring stable return to the market. I'm from Shanghai Securities. I have two questions. NCI has established three pilot funds with peers. What's the actual result? Will you further increase your diversification asset allocation? Second question is how would you view AI's impact on the company? What's your future plan for AI empowerment? Thank you for your question. Regarding three pilot plans, we started from March 2024 to now. In the past two years, we have achieved both social result and economic result. We have been fully carried out the central government decision. Under guidance of NFRA, we responded to the requirement to enter the market. With peers, we established three pilot funds. Our total investment reached 46.25 billion yuan. The target fund is conducted to the asset management about your second question about diversification investment. This is our key strategy. We will based on the following three considerations. First, in the low interest rate environment, We must make diversified investments to increase our long-term returns. Second, in the 15th five-year plan, our company is undergoing a transformation with the improvement of capital market. We have been presented with opportunities to participate in the capital market. We have improved our professionalism, including our improvement in the front office and back office, which all lay good foundation for us to engage in diversified investment. We are confident we can provide sustainable returns to shareholders and customers. Thank you for your question. This is a very fancy question about AI. I'd love to share with you our view about our thinking about AI for 2025 from the top level to the grassroots operations. we are confident that we all embrace AI. AI is not a vision of the future, but it's fundamentally reshaping the industry. The key in the transformation does not only make us tailor-made pricing, but also enables us to provide customized service and real-time responding. also unable to real-time warning and monitoring. In the past year, we have been impacted fundamentally by AI. In customers, AI make us know customers really. Secondly, in operation, AI makes us reshape the service process. Third, for risk management, AI let us guard our risk bottom lines. We have awarded 12 authoritative awards from authorities such as PBOC, China Academy of Information and Communication Technology. We have got ISO Business Continuity Management System certification. And passed the DCMM false terror recognition. And make our service better. whether the illustration system, AI proposed 258,000 proposals about AI makers for improvement in qualification inspection. We put on 111 AI agents with 97% solvency ratio. Accuracy ratio hit 100%, covering 3,500 counter staff and over 100,000 agents. those measures improve our digital customer engagement liabilities for 2026. We will make measures in the four areas. First, we will implement the 15th February plan in technology. Secondly, in expansion of AI applications, we will build seven virtual employees covering seven areas through the large-small model synergy. We would like to have digital productivity equivalent to 3,000 people. Make machine do their own stuff and make people do more valuable stuff. Dig data value deeper. We would empower data from visibility to true value. Make data core assets to drive business performance. This year our focus is on the development of corporate cloud. We aim to establish one cloud multi-chip infrastructure resource framework. Technology empowerment has been through every corner of corporate operation. We will maintain our strategic resolve. and to make AI more productive for the 15th failure plan.