Bank Of China Unsp/Adr

Dear investors, analysts, and media friends, good afternoon. This is the Bank of China. 2022 Annual Results Release. And my name is Yu Ke, the Securities Affairs Representative and General Manager of the Secretariat Department of BOC Board of Directors. And today, I, myself, and my colleague, Mr. Jia, Spokesman and also Director of the General Office of the BOC, will co-chair. Let me introduce the officials. Today, we have President Liu Jing with us and Vice President Zhang Yi. And also joining us in Boao, we have Vice President Zhang Xiaodong and Risk Management Director Liu Qiandong and Business Management Director Zhao Rong and Chief Information Officer Meng Qian. In accordance with regulatory requirements, we also have specifically invited Mr. Jiang Guohua on behalf of independent directors attending the release as well. Also, Mr. Lin Zhenming, President of BOC Hainan Branches. is also joining us in Boao. Today we set up a venue in Boao because of the participation of President Liu Qing in the Boao Forum for Asia. The forum has attracted great attention at home and abroad, and President Liu only returned to Beijing last night. Next, let's invite President Liu to talk with you about the feelings of attending the forum. Investors, analysts, and media friends, good afternoon. Vice President Zhang Xiaodong and I myself yesterday took part in the plenary session of Boao Forum for Asia, as well as other activities, and I just came back to Beijing for today's event. And Vice President Xiaodong is still in Boao, and he's joining us online. Boa Forum for Asia this year has attracted guests from different parts of the world and also different sectors. People are appealing for cooperation and aspire for greater cooperation. And I heard Premier Li Qiang said at the opening ceremony that the potential for Chinese development is very great and also the momentum is also good. And with that, China can inject more certainties for the world economic recovery. I also can feel that the Chinese-style modernization not only will provide different types of new opportunities for China, but also new concepts, new mindsets, as well as new targets for the whole world. And Boya Forum for Asia this year takes the mission as to synthesize positive energies for Asia as well as for the whole world. And for this year, people appeal for even higher level of opening up, that is the Chinese voice. And also steady progress of Hainan Free Trade Island is a very important landmark for China's opening up. And today, in Beijing, Hong Kong, as well as in Boao, we have three different venues – And the purpose is that, as I mentioned before, as you can see, our Vice President Chang and other colleagues are joining us in Boao. So with that, I hope that you can see and you can feel the momentum of Chinese economic recovery as well as the potential brought by China's reform and opening up as well as the role BOC can play in contributing to China's further opening up. Next step, Bank of China will continue to be a global bank and a specialized bank, a very capable bank in delivering different types of businesses. We try to serve the dual circulation as a national strategy in China and will continuously to serve high-level opening up of China. Thank you. Thank you, President Liu. President Liu not only shared with us the positive energy from Boao Forum, but also conveyed the message in terms of confidence of a further development of BOC. Next, let's move to the official agenda. First of all, we want to invite President Liu to present on the annual results of the company and then followed by a Q&A session. And it should be noted that all the financial figures presented today are prepared in accordance with international financial reporting standards unless otherwise specified. The presentation can now be downloaded from BOC official website or viewed at the bottom of the live page. Now let's give the floor to President Liu who will present the results of Bank of China. investors, analysts, and media friends. Looking back on 2022 for Bank of China, it can be called a fruitful and wonderful year. On February the 4th last year, on that specific day, we started supporting Winter Olympic Games by providing financial services, and then the next day, the 5th of February, we celebrated the 110th anniversary of the bank. During the whole year, we made overall plans to promote services to support real economy and also to fight against financial risks, deepen reform and innovation, prevent pandemic, and also achieve sustained and steady growth in our businesses, and we successfully hit all the annual targets. Next, I want to be more detailed in introducing the business performance of Bank of China in 2022. First of all, steady progress in terms of financial results. The annual operating income was 619.139 billion RMB and after-tax profit and profit attributable to shareholders increased by 4.47 and 5.02 respectively. Among them, net interest income increased by 8.36%. Net interest margin remained stable and cost control achieved good results as well. Secondly, assets and liabilities continue to be optimized. The growth rate of assets and liabilities of the group reached 8.2% and 8.1% respectively. And the increment of domestic RMB loans and deposits both reached record highs in China, and also business structure continued to be optimized. The proportion of net loans to customers increased by 1.86 percentage points. The volume and the price of RMB customers' deposits in China have developed in accordance Denation and a proportion of high-cost deposits has further declined. Personal deposits have also surpassed corporate deposits for the first time. Third, the foundation for further development continues to be improved. The number of active corporate customers increased by 9.1% year-on-year, and total number of personal customers was nearly 510 million, and the highest growth rate in comparable industry, the number of monthly active customers of personal mobile banking increased by 7.2% year-on-year, Number of corporate internet banking and corporate mobile banking customers increased by 9.8%, 24.11% respectively. And also, our asset quality remained stable, and NPR ratio was 1.32%, and provision coverage ratio was 188.73%, up by 1.68 percentage points from the end of 2021. That's the result of a internal development as well as external supplementation and capital adequacy ratio reached 17.52% off by 0.99% compared with the year before. In 2022, Bank of China continued to strengthen the implementation of the group's 14th five-year plan and truly served the stability of the overall economy with our strategic tasks and also moved ahead in terms of high-quality development. First of all, we tried to stabilize the overall economy. We formulated action plans to support the real economy and introduced more than 40 measures in eight different aspects. Domestic RMB loan increased month over month and also year over year as well. Annual increase of more than 1.8 or rather 1.58 20 yuan. We set up a special loan to stabilize and expand jobs and launched a service plan of inclusive employment loan. and we rigorously support catering, retail, tourism, transportation, and other industries, and also support key industrial sectors and work links in the national economy. The balance of medium and long-term loans in the manufacturing industry increased by 6.23% compared with the beginning of the year, and loan for private enterprises increased by over 19%, and also respond to the national policy of ensuring the delivery of apartments and stabilize people's livelihoods. and also actively provide customers with multi-channel financing services and maintain market leadership in bond underwriting, and also custodian services have been developing very fast. As the main bank for cross-border finance, we have been increasing financial support for stabilizing foreign trade and investment so as to serve the overall economic development and trade. And domestic international settlement volume was $3.4 trillion, and the market share increased of international trade settlement ranked first in the industry. Direct investment in import and export trade financing increased by 15% year-on-year. Cross-border guarantee business maintained leading position in the industry. Secondly, we try to support the economic and social development and made great progress in five different areas of financial support. The eight areas as a concept in recent several years, especially in our release activities, has already been introduced and explained by me in a very comprehensive way. And in terms of our finance for science and technology, we have provided more than 1 trillion yuan of credit support to nearly 50,000 companies in the science and technology sector. The total amount of financial support for technology companies was about 455.9 billion RMB, and also the number of branches featuring technology finance increased To 184, we improved our product and service system, developed our own evaluation method for technology-based enterprises, and optimized our credit granting process, and also provided credit to over 18,000 specialized innovative companies with more than 345 pending RMB. And also, the Science and Innovation Mother Fund was successfully prepared. We launched the Yangtze River Delta and the Hengqing Science and Innovation Fund as well. Continue to deepen the cooperation with the government agencies and carry out in-depth cooperation in the fields of science and innovation as well as IP, financial services, national strategic science and technology innovation, etc. And in terms of green finance, we constantly optimize the governance structure and the mechanisms and the policies and deeply participate in global green governance in 2022. The balance of green credit reached 1.98 trading RMB with a 41.08% year-over-year increase and will continue to lead the market in terms of underwriting, insurance, and investment. Actively participate in benchmark. and landmark green projects with international influence relying on advantages of our globalized market as was comprehensive management to create the so-called POC green color. We continue to promote green and low-carbon technology as world's development takes the lead in completing our carbon inventory and also make sure to integrate the concept of green and low-carbon development into all aspects of our daily operation, try to build an environmentally friendly low-carbon bank. In terms of inclusive financing, we follow the concept of financial services for the benefits of people, continue to improve the quality and efficiency of our services. And by the end of 2022, the growth rate of inclusive loan to small and micro enterprises reached... 39.3% and also number of customers increased by 20.87%. We developed 17 online products. And the new online inclusive loan accounts for more than 62% of the total new loan. We released a Hui Ru Yuan app. so as to build an intelligent service ecosystem. We strengthen the services for key customers and carry out micro enterprise assistance program, maintain first place intellectual property rights financial support businesses. We also provided comprehensive service programs, especially for individual entrepreneurs and commercial entities, et cetera. and also continue to deepen cross-border services. And in terms of cross-border finance, the market share of international settlement, cross-border IMB settlement, clearing settlement, and sales of foreign exchange, et cetera, in these different aspects, we have maintained number one. And the volume of cross-border IMB settlement of domestic institutions was 10.4 trillion dollars. RMB and cross-border receipt and payment for new foreign trade customers exceeded 280 billion yuan in the whole year with 85% increase rate and more than 900 corporate credit projects have been followed up in countries that are part of the BRI and also total credit support exceeded 269 billion US dollar. We formulated and issued 20 action plans to adjust and stabilize foreign trade across different cycles, continue to provide high quality services to different expos.

In the Consumer Goods Fair in Hainan, the Canton Fair in Guangzhou, the Survey Trade Fair in Beijing, and other large-scale national exhibitions, VOC is a strategic partner in all those events. Yesterday, when I was attending the Boao Forum for Asia in Boao City, it was a national-level fair, but it seems like... BOC's fair because it is the employees of BOC everywhere and the BOC logo everywhere and BOC customers signing agreements with us or releasing information on different activities. We organized 150-plus events in more than 30 regions across the country, directly serving and matching more than 33,000 foreign trade enterprises, accelerating digital innovation. BOC was the first to convert foreign currency notes into digital R&B through self-service exchange machines. That is about cross-border finance. In the past year's results release, it was always a release by the president and vice presidents. Every time during the release, I will highlight the internationalization and distinctive features of BOC among all the financial institutions in China. If you say BOC is differentiated from our peers, first is our internationalization, our global operations. Therefore, we have been emphasizing in terms of the co-indicators of foreign exchange and the promotion of cross-border finance and cross-border IMB settlement. We are resolute to be the first among the peers, keeping our professionalism in different areas. in the high-level opening up of China in financial markets opening in... globalization and internationalization of financial services were always there for the country, for the customers. In the area of consumer finance, we took a number of measures to help expand domestic demand with the scale of consumer finance loans growing steadily and the customer base further strengthened. We also helped to ensure the stable operation of the real estate market and actively cooperated with local governments to promote the guaranteed house delivery, focusing on the promotional consumption We accelerated product innovation and upgrading, focusing on special customer segments such as agriculture-related and with an increase of 50% in non-housing consumer loans. We promoted the transformation of our product lines into online products with a significant increase in the coverage rate of personal online loans, reading 82.63%. Credit card auto installments amounted to 115.4 billion RMB, an increase of 7.2% year-on-year, leading the market in terms of volume and growth rate of accounts receivable balances. In terms of wealth finance, we continue to enhance the level of inclusiveness, continue to enrich our product shelves, increase the supply of inclusive products, and implemented a preferential rate policy. We have upgraded our professional capabilities and relied on our information service system to provide more comprehensive and intelligent asset allocation structure, diagnosis, and optimization solutions to our clients. We improved the customer companionship app and built an open platform for wealth management with 31 external institutions cooperating with mobile banking's Caifu Hao platform. And by the end of 2022, the total number of personal customers was... 510 million of which the number of mid to high-end customers grew by over 14%. The scale of financial assets of personal customers was nearly 13 trillion RMB of which the market share of investment financial assets of domestic banks increased. There were 159,600 private banking customers and the scale of AOM of private banking customers reached 2.42 trillion RMB. Just now I have mentioned mobile banking of BOC. In recent years, press release of our annual results, I have conducted a lot of publicity for two projects of BOC. One is number one project, that is our mobile banking project. I used to work in several financial institutions. I also have personal housing mortgage loan. I also have other financial service needs. So I have the mobile banking apps of several banks. So I have my personal customer experience. And now I'm president of BOC. So first of all, I would like to talk about the BOC's mobile banking app. It is the most convenient, most easy to use mobile banking app. Together with our customer experience experts, we are soliciting opinions for further improvements. What we want to hear are negative opinions. so we can make improvements. But at the same time, we are receiving myriads of positive evaluations in different mobile banking areas. We have different functions to meet different customers' needs. It's user-friendly interface with very convenient services. So this is the number one project, mobile banking project of the OC. Another project is called number one plus project. That is the enterprise level architecture. We call it Oasis project. which I will talk about in greater details later. In terms of supply chain finance, firstly, BOC helped to preserve and stabilize the supply chain, providing liquidity support to core supply chain enterprises amounting to nearly 2.5 billion RMB in 2022 and providing on- and off-balance sheet trade finance support to upstream and downstream enterprises amounting to over 2.2 trillion RMB, representing a year-on-year increase of 14% and 31% respectively. Secondly, we strengthen our tech capabilities to launch innovative online financing products and put into operation new online supply chain financing services, such as easy credit, providing customers with a digital scenario-based and intelligent supply chain finance experience. Thirdly, we launched a brand-new sub-chain, BOC Smart Chain, to extend quality supply chain financial services to national strategies and key areas, such as logistics, greenness, aviation, and home appliances. In the area of county finance, we focused on consolidating the achievements of poverty eradication and supporting rural industries in the countries to promote the comprehensive revitalization of the countryside with the power of finance. In 2022, county institutions achieved a significant growth in deposits, loans, revenue, and profit before provisioning. The balance of agricultural-related loans and inclusive agricultural-related loans grew by 20%, 38% respectively. 160 key pairing-off counties recorded loan growth rates of over 17%, and financial services such as credit, consumer assistance, mobile banking, and national student loans reached 157 key pairing-off counties. In 2022, 28 new county institutions were opened by BOC, including three in key support counties. More than 550 rural revitalization outlets have been established with a coverage rate of over 63% in the counties. The number of monthly active customers for mobile banking in counties grew rapidly, and the beautiful countryside version of mobile banking project was launched. The bank launched a seed industry loan and agricultural machinery loan and put into operation the Credit Village Farming Express loan online product with regional characteristics. BOC Fullerton has maintained its position of being rooted in the county, supporting agriculture and small businesses, and continue to leverage its advantages as the largest village bank in China. So these are the measures that we have taken in supporting counties through financial services. in ESG and that is the CSR external rating. BOC is receiving a higher and higher rating. You know, MSCI, MSCI ESG rating for BOC has been elevated to A. Domestically, More and more organizations are conducting research on green finance and green development and are also conducting rating in those regards. Corporate social responsibility is fully reflected in county finance and inclusive finance as important components of CSR. Inclusive finance and county finance should be incorporated into ESG and corporate social responsibility ratings. and many of our peers in terms of inclusive finance and county finance. We have a lot of pairing of counties to help for rural revitalization and a lot of achievements have been made. So in terms of corporate social responsibility rating, those achievements should be fully reflected. Thirdly, we deeply integrated into the new development pattern of dual circulation with one mainstay and two engines developing in a synergistic manner In 2022, we fully supported the construction of the country's dual circulation and the opening up to the outside world at a high level, enhanced our integrated global service capacity around the Chinese elements, optimized the global account manager system, focused on core customer groups such as Fortune 500 enterprises in China and large Chinese enterprises going global, and strived to build a system of one point of access, global response, and comprehensive services. The BOC has also been working on the development and security of overseas markets, grasping structural opportunities and revising its one bank, one policy differentiated development strategy. The global service network continued to be optimized and BOC Macau Limited was opened. Significant progress was made in the construction of overseas regional headquarters with the IPO regional headquarters in the EU successfully established and operating internationally. Regional synergy development steadily was promoted and overseas institutions operate safely and smoothly. The group's profit contribution stabilized and rebounded as overseas commercial banks recovered well. The comprehensive operating companies responded appropriately to changes in the external environment, strengthening the competitiveness of key institutions in the market and further enhancing their business expansion capability and group synergy. Fourthly, the group's digital transformation progressed solidly and operational efficiency continued to improve. We continued to invest in technology and focused on building 10 new digital talent teams. The OASIS project was iteratively promoted. The value of digital assets was accelerated and elevated, and digital processes, data, and mechanisms were continuously enriched and improved. We continue to upgrade our new technology platform and achieve the richer results in the FinTech application. We further enhanced our network security operation capability and continue to ensure business continuity. We accelerated the upgrade and iteration of online and mobile services, iterated mobile banking to version 8.0, released a white paper on financial scenario 2.0, and launched digital inclusion, digital CIE, and smart enterprise treasury. apps and platforms. We have explored a wide range of digital financial solutions in different industries and fields, and our tech-enabled financial services have continued to improve in quality and efficiency. Fifthly, we integrated development and safety and security and continue to improve our comprehensive risk management capabilities. We have promoted the construction of a comprehensive risk management system, gradually established a multilevel and comprehensive risk and emergency management mechanism, continued to optimize the closed-loop risk management and accelerated the construction of an intelligent risk control system. The forward-looking and practical nature of industry policies continue to improve. Guiding the continued optimization of the credit structure, we improved our early warning and monitoring and asset quality control system, insisting on early identification, early warning, early detection, and early disposal, and maintain stable asset quality. Market risk and liquidity risk management were actively and effectively managed, while internal control and operational risk management continued to be strengthened, and the group's major risk indicators were in line with regulatory requirements. The year of 2023 is the first year for the full implementation of the spirit of the 20th CPC National Congress and the key year to the group's 14th five-year plan. Our risk management culture is being strengthened, both at the macro and micro level. Capabilities have been further improved in BOC. Recently, in the financial sector, there have been high volatility. First, it started with SVB, Silicon Valley Bank, and then Credit Suisse. its merger with UBS and also the risk incidents encountered by some other financial institutions. For Chinese financial institutions risk management, it offers a warning bell. So the risk management business line, the risk management department and other related departments obviously have quickly responded to offer an active and fast response and timely conducted objective comprehensive and in depth risk analysis and judgment in various domestic and overseas business areas. We conducted stress testing immediately and reported to the regulators. This has fully reflected our professionalism and our capabilities to respond to risks, especially market risks. As I mentioned just now, the year 2023 is the first year for the full implementation of the spirit of the 20th CPC National Congress and a key year for the group's 14th five-year plan. We will continue to promote the implementation of the plan and serve the high-quality development, both in terms of economic development and also societal development.

Support the development of key sectors and key areas as well as the weak links by providing credit support and also follow closely the strategy of expanding domestic consumption and also effective measures will be taken. Secondly, we will actively seize strategic opportunities to consolidate our advantages around the whole world and also improve our market competitiveness as well as the group contribution. And third is to deepen the integration of business technologies and improve the efficiency of our services. And next is better risk management to make it more sensitive and also effective. And pay close attention to cross-contagion, making sure that there will be no systematic risks and Bank of China will continue to strive to build a world-class modern banking group with a sense of mission and a sense of urgency as well as a sense of responsibility. We will continue to follow the road of developing ourselves as the top financial institution in the world so as to create greater values for shareholders, customers, employees, as well as the whole society. Thank you. Thank you, President Liu, for the fantastic presentation. Next, we'll move to the Q&A session. And we want to invite investors and analysts to raise questions. But please identify your name as well as the organization before raising the questions. And if you want to raise a question, please raise your hand. Okay. Mr. Dai. Thank you, management. And my name is Dai Zhifeng. First of all, I want to congratulate the management. Given the complex business environment, such a financial result is very good. Yesterday, we actually looked at the results, and we felt that over the years, the asset of Bank of China has been growing in such a positive way, especially last year. The domestic RMB loan has increased to such a level. So we want to ask... For 2023, what is the target for credit growth? And also, how about the demand for credit? And specifically, what would be the strategies for credit allocation for Bank of China? For example, what is the pace and what is the structure and what would be the industries and regions that you want to prioritize? Thank you. Thank you for your question. Well, credit allocation is a major approach for banks to serve the real economy, and data on this topic really has been something that the market has been paying close attention to. And we want to invite Vice President Zhang Xiaodong in Boao to answer a question. Thank you for your question. Well, yesterday in Boao, together with President Liu and other colleagues, we took part in the plenary session of the Boao Forum, and also we took part in other activities today, and we can feel the momentum and vitality of China's economy, and that strengthens our confidence in serving China's people. Thank you very much. in terms of dual circulation and also accelerate the construction of our strategy of one body, two wings and increase financial support in key eight areas and to implement our structural reform from the supply side so as to better to the development of our national economy. 2023 is the first year in terms of implementing the spirit of the 20th National Congress of the CPC, and several key tasks have been mentioned in the government work report. We will center our work on that, and the overall tone is to keep stability while making progress. We follow the overall asset growth target of the group. We estimate growth rate of 8% to 10% and maintain steady growth of IMB loan increase the vitality of RMB bond investment. We want to expand our advantages in terms of foreign exchange businesses for high-quality development. Since the beginning of the year, China's economy has been accelerating its recovery and also the total scale of financing has increased and the credit demand has been on the rise and also there has been marginal increase for the credit from residents and domestic RMB loan for Bank of China has increased more than last year. and plan for this year. First of all, steady growth of credit on the premise of meeting macroprudential management requirements will continue to support the real economy, and we will moderately expand the scale of new loans and maintain overall growth rate of loan at a reasonable level. And secondly, credit structure should be continuously optimized. If we look at industries, We will focus on the eight areas for support and support the key areas and also weak links of our economic development and increase support for scientific innovation, manufacturing, green and energy, supply, private economy, et cetera. We will also enhance inclusive financial support for MSEs as well as rural revitalization and county economy. And from a regional perspective, we will implement the national plan major regional strategies as well as regional coordinated development strategy improve the credit support in key areas, for example, Yangtze River Delta, Greater Bay Area, Beijing, Tianjin, Hebei, as well as the Xiong'an New Area, and also make sure that credit demand in remote and backward areas, revolutionary bases, and ethnic minority areas will be and promote the balanced and coordinated development of the eastern, central, western and northeastern regions in China. In terms of credit for personal individuals, we focus on the strategic deployment of stabilizing the housing market. On one hand, we follow the city-specific policy, increase investment. in personal housing loans and ensures improved housing demand will be met and make differentiated credit policies. On the other hand, what will support the upgrading of residence consumption, improve people's demands for different types of services, centering on the new consumption, new scenarios, et cetera, to promote the expansion of non-housing consumption loan. Thirdly, to reasonably arrange the pace of credit supply, what will carry out the requirements of a monetary policy, and also adjust the pace of credit supply according to the demand of the real economy so as to make accurate decisions. And we want to make sure that we'll have a reasonable growth of credit, making sure that we will be a stabilizer of the real economy to serve the development of the real economy. Thank you. Thank you, Mr. Xiaodong. Next question, please. Mr. Wang from China Life Insurance Asset Management. Thank you for the opportunity. My name is Wang Napong. This is a great opportunity for me to ask a question about net interest margin. In the past one year, Bank of China has been supporting real economy. However, you performed pretty well in NIM. So I wonder whether you can elaborate the reasons behind. And also, With multiple rounds of LPR declining, how would you expect the trend of NIM in 2023? Thank you for your recognition. Let me invite Vice President Zhang Yi to answer a question. Thank you, Mr. Wang, for your interest in this topic. As you mentioned before, last year, the NIM of the group was 1.76%. That was an increase. instead of a decrease. So the stability of NIM from Bank of China perspective was way better. And if you look at the factors, last year, actually, there were negative factors, but also positive factors. And in terms of negative factors, as you mentioned before, LPR were decreased for many times for one-year LPR and three-year LPR. And actually, the return rate of RMB asset actually dropped quite a lot, 16 base points. And that actually lowered the interest margin of the group by 12.29 base points. And if we look at positive factors, there are two as well. First of all, our own management, and secondly, the market condition. In terms of the management, we have been voluntary in optimizing our asset and liability structure. By doing this, we can improve NIM by 7.52 base points. And in terms of asset structure, the growth of low-yield interbank lending and other assets was controlled and the investment of high-yield assets was increased. So the average balance of loans accounted for actually 63.82% increase of 1.31% of the previous years. And then debt structure, the point is that to focus on the marketing of demand loans by building platforms and expanding channels of businesses by using technologies, the percentage of demand RMB deposits has been increased. And also, high-cost deposits as a proportion has been reduced. So, in another word, For example, we have different types of agreement-based deposits, deposits with more than five-year maturity, et cetera. And over the years, we are talking about one percentage point declining. And because of that, domestic RMB liability cost has been decreased a lot, and domestic RMB deposit cost has been down as well. And as President Liu Jin mentioned Bank of China is quite international. Last year, with the multiple rounds of interest hike in overseas markets, that actually led to improvement of our foreign currency spreads and increased our group interest spreads by 5.14 basis points. Most foreign currency loans of the bank are priced at floating interest rates, while a high proportion of foreign currency customer deposits are priced at listed interest rates. So the asset duration is shorter than the liability duration. These are several reasons. Looking into 2023, this year there is still great pressure in terms of NIM, and from IMB perspective, LPR declining to us in terms of the impact will be greater than that of last year. For Bank of China, as one example, RMB loan, actually, for the fixed rate, it accounts for over 90%. And in terms of the foreign currency interest margin, last year actually was good. But this year, as everybody estimates, that Fed's interest hike will slow down. Another thing is that foreign currency debt, as time goes on, in terms of repricing, It will only accelerate, so the cost for this part will increase. And the level of improvement in this regard will be weaker than last year. Overall speaking, overall NIM for Bank of China will be declining to a certain extent. However, despite the pressure, we will continue. provide quite active management. First of all, we want to focus on both the quality as well as the quantity. I am relatively new to the management, and the first meeting was led by President Liu in terms of improving the strategy for liability and RMB deposit cost of Bank of China is 1.88%. There is still room for improvement. First of all is to manage price, look at the market interest and also to improve our internal pricing mechanism, look at the demand cost and also maturity so as to manage this in a better way. On the other hand, manage the structure. take the eight areas as the starting point to improve our products and also to increase the outreach to key customers and also upstream and downstream customers. So we could do better in this aspect and increase the percentage of low-interest asset. And another part is about the optimization of the asset structure. On top of supporting a real economy, we probably will. increase the investment in retail loans so as to support consumption expansion, and also to activate the existing assets to reduce the proportion of low-return assets, making sure that our name will be within a reasonable range. Thank you. Thank you. Vice President Zhang Yi, next question, please. Mr. Ma? Sorry, Ms. Ma, thank you for the opportunity. My name is Ma Tingting. I have a question. Actually, we have noticed that the Central Economic Work Conference and the latest Government Work Report both pointed out that for this year the priority of our economic work is to expand both domestic and international demand. So domestic consumption and the recovery of the consumption would be considered as a priority. And also for the first time it has proposed the concept of consumption for everybody as was the scenario-based consumption. So I want to ask, What measures have been taken by BOC and also in terms of consumer finance, what would be further measures to be taken? Thank you. Let's invite President Liu Jin to answer this question.