China Construction Bank Corporation

Ladies and gentlemen, welcome to the meeting. Now let's give the floor to the moderator, distinguished investors, analysts, and friends from the media. Ladies and gentlemen, good afternoon. Welcome to CCB's Q3 Press Performance Release. Thank you for your attention and support and interest in CCB. Today we have with us Chief Finance Officer, Mr. Sheng Liu Rong, Board Office, Asset and Liability Management Department, Finance and Accounting Department, Asset Liability Management Department, Credit Risk Management Department, Corporate Finance Department, Financial Inclusion Department, Personal Finance Department, Housing Finance Department, Credit Card Center, Financial Market Department, Asset Management Department, FinTech Department, Corporate and Cultural Development. I'm Li Jianjiang, Vice President of CCB. Since now we've announced our Q3 results, I'd like to briefly report to you the performance. CCB has been insisting on President Xi Jinping's philosophy and to implement the requirements and arrangements of the central government and fulfill our responsibility as a large state-owned bank. We also aim at developing high-quality development and also fully serve the real economy and to seek high-quality development. By the end of the third quarter of 2024, the total assets stood at $40.9 trillion, up by .87% from the end of 2023. The loans and advances is around $25.7 trillion. In terms of liability, the total liability is $37.6 trillion, up by .9% from that of end of last year. The total equity deposits is around $28.5 trillion. For the first three quarters, our net profit stood at $257.1 billion on the yuan, up by .7% -on-year. The average ROA is around the 0.87%. ROE, 11.03%. MPL ratio stood at 1.35%, slightly down, that is .02% points compared with the year-end of last year. The PCR stood at 237.03%. TTL or provision to loan ratio, 3.2%. Since this year, we have also been making progress in serving the rich and the real economy and to better serve the people. We have strengthened our investment to further promote the high-quality development of the economy. At the end of the third quarter, the corporate loan stood at $14.6 trillion. Personal loan, $8.4 trillion. So we will focus on the financial services for priority areas to support, to modernize the infrastructure development. And also in transportation, inventory, and etc. And also including manufacturing, the long-term, -long-term support for the manufacturing industry. And also to support the priority strategies of the central government and to focus on the main areas, like the Green Bay area and etc. to support the development. So this year, we have been also trying to do a better job in the five priorities of the financial sector. We built the financial service system to develop a lot of integrated financial solutions to support financial and innovative enterprises, especially offering them differentiated solutions. At the end of the third quarter, for strategic new emerging industry, the loan extended is $2.4 trillion. So these have actually achieved rapid growth. In terms of green finance, we saw the different green finance development to promote economic and social development, especially in a green manner. At the end of the third quarter, the green finance loan is around $4.5 trillion, up by 17.95%. For our own proprietary bond investment, especially to green finance, it has also made great achievements. For ESG rating, our rating is much higher than the marketeers. For financial inclusion, we focus on micro-small enterprises and to better serve the agri-related customers, focusing their needs and demands to better serve those clients. At the end of the third quarter, financial inclusive loans is around $3.9 trillion, agri-related is $3.35 trillion. In terms of pension finance, we found strong support for the pension industry, offered differentiated solutions, thus to implement the national strategies on this part. We guide our credit resources to the pension-related industries and to better promote the pension finance and also the pension services to create the pension-related ecology. In terms of digital finance, we continuously promote the mobile phone-related development, the digitalized development of our services. For example, we have the DualStar APP, and we're also trying to support the digital economy. For Q3, the total loans stood at over $750 billion, up by 15.98%. Since this year, we've continuously strengthened the granularized management at the group level. We stick to the commercialized and sustainable development of the bank to continuously improve the digital transformation of the bank and to enhance the granularized management of the group. We've also strengthened the affidavit management, and we established the enterprise to offer integrated financial services. In terms of the business management, in terms of the net income, it's better than our peers. In terms of fee structure, we've also optimized the fee structure. In terms of capital management, we've increased the -to-income ratio, -to-income ratio, stood at 25.25%. We've also strengthened the intensive capital management to continuously improve the capital efficiency and to guide capital or resources to the asset-light and high-return industries. The car ratio stood at .35% to provide a very solid foundation to serve the real economy. And also, we continuously put to strengthen the FinTech development to actually allocate our FinTech resources to satisfy the customer's needs and also strengthen the risk prevention and etc. And also to strengthen the digital asset management, optimize the service solutions to our customers to improve the efficiency and the customer experience. Since this year, we've also been trying to enhance the comprehensive risk management and stick to the concept of risk prevention as the priority and uphold the principle of stability, prudence, and comprehensive risk management and to establish a comprehensive, active, proactive, and intelligent modern risk management system. And to strengthen the active management of asset quality, we have dissolved the risk in key areas and to strengthen the IT risk management and ESG-related risk as well as other new emerging risks. At the end of the third quarter, the NPL ratio is around 1.35%, maintaining stable asset quality. Currently, the global economy momentum is a little bit weak with major economies exhibiting different or divergent performances. For example, like U.S. and developed economies, they are in their interest rate in the downward cycle. And to guard against risk in key areas, we have made achievements in this aspect. And also we have promoted high quality development so as to provide very good conditions for the sound development of the banking sector. Going forward, CCB will continue to promote high quality development to continuously strengthen the risk awareness, comprehensive awareness, customer centered awareness, and et cetera. And we will also try to stick to innovation to focus on our main businesses and we'll shoulder our responsibility of the financial sector and to improve people's well-being and we'll take real actions to continuously bring return to our stakeholders and also the shareholders. Thank you. Now we're entering into the Q&A session. In order to enable more investors, analysts to have opportunities to ask questions, I suggest you limit yourself to one question and identify yourself before asking questions. Thank you. Ladies and gentlemen, we're now into the Q&A session. If you want to raise a question, please press the asterisk plus one and wait for us to queue you. The first question from Morgan Stanley, JP Morgan. Thank you. Can you hear me? Yes, we can. Thank you. Thank you for this opportunity to raise a question. He's the first one to raise the question. I would like to know the profitability of the first three quarters and in changes to the first half of the year. So how can we view the performance for the first three quarters? For this question, I would like to invite Mr. Shen to answer the question. Thank you. Thank you for your question. And also I'd like to welcome all the analysts and investors for joining us at the meeting because it's actually not the working hours right now. So thank you for your time. And thank you for Madam Li's question. This year, since 2024, in accordance with the central government work arrangements, we focus on high quality development as our first priority. Especially we focus on our main businesses and to solve the high quality development of the real economy. And during the process, we've also realized a benign development of the economy. So we have maintained stable operations. The net profit has increased by 0.65%. The key financial indicators have also been quite good. For ROAs, 0.87%, ROE, 11.03%. According to our knowledge, we are in a leading position among our peers. So generally speaking, in terms of operating performance, there are several features. Let's look at the revenue and the cost. There are four features. The first one is the net interest income maintained stable. The the first three quarters, the interest earnings interest rates have been up by 0.81%. You can also see that actually for the loans and bonds, all these assets, they have actually accounted for a large share. So for the first three quarters, the loans and bonds investment, the percentage has been up by .92% points. So we're also trying to expand the value loans and control the cost of capital. And thirdly, we've tried to enhance the refined management of the loan pricing. For the first three quarters, the NIEM was 1.52%. We're

still

ranking among the top among our peers. So compared with that of last year, NIEM has been lowering down, has been decreasing. We can also see that for a lot of the loans, we can see there has been a lot of decreasing in terms of the interest of the loans. And then in terms of serving the comprehensive services of the customers, the non-interest income has also been increasing, has been decreasing. We can see that for the total banking sector, the fee and commissions of the banking sector have been dropping. And also we can see