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1、Bank of China LimitedThe print version of the Banks 2023 Interim Report,to be published in September 2023,will supersede this version.Stock Code:3988(Ordinary H-Share)4619(Offshore Preference Share)2023 Interim Report1Definitions2Important Notice5Corporate Information6Financial Highlights8Business O
2、verview10Management Discussion and Analysis13Financial Review13Business Review26Risk Management58Capital Management69Outlook71Environmental and Social Responsibilities73Changes in Shares and Shareholdings of Shareholders82Directors,Supervisors,Senior Management Members and Staff87Corporate Governanc
3、e91Significant Events97Report on Review of Interim Financial Information103Interim Financial Information104Contents2In this report,unless the context otherwise requires,the following terms shall have the meanings set out below:The Bank/the GroupBank of China Limited or its predecessors and,except wh
4、ere the context otherwise requires,all of the subsidiaries of Bank of China LimitedArticles of AssociationThe performing Articles of Association of the BankA ShareDomestic investment share(s)in the ordinary share capital of the Bank,with a nominal value of RMB1.00 each,which are listed on the SSE(St
5、ock Code:601988)Basis Point(Bp,Bps)Measurement unit of changes in interest rate or exchange rate.1 basis point is equivalent to 0.01 percentage pointsBOC Asset InvestmentBOC Financial Asset Investment Co.,Ltd.BOC AviationBOC Aviation Limited,a public company limited by shares incorporated in Singapo
6、re under the Singapore Companies Act,the shares of which are listed on the Hong Kong Stock ExchangeBOC Consumer FinanceBOC Consumer Finance Co.,Ltd.BOC Financial TechnologyBOC Financial Technology Co.,Ltd.BOC Fullerton Community BankBOC Fullerton Community Bank Co.,Ltd.BOC InsuranceBank of China Ins
7、urance Company LimitedBOC LifeBOC Group Life Assurance Co.,Ltd.BOCG InsuranceBank of China Group Insurance Company LimitedBOCG InvestmentBank of China Group Investment LimitedBOCHKBank of China(Hong Kong)Limited,an authorised financial institution incorporated under the laws of Hong Kong SAR and a w
8、holly-owned subsidiary of BOCHK(Holdings)Definitions3BOCHK(Holdings)BOC Hong Kong(Holdings)Limited,a company incorporated under the laws of Hong Kong SAR,the ordinary shares of which are listed on the Hong Kong Stock ExchangeBOCIBOC International Holdings LimitedBOCIMBank of China Investment Managem
9、ent Co.,Ltd.BOCI ChinaBOC International(China)Co.,Ltd.,a company incorporated in the Chinese mainland,the ordinary shares of which are listed on the SSEBOCLBOC Financial Leasing Co.,Ltd.BOC-Samsung LifeBOC-Samsung Life Ins.Co.,Ltd.BOC Wealth ManagementBOC Wealth Management Co.,Ltd.CASChinese Account
10、ing StandardsCentral and Southern ChinaThe area including,for the purpose of this report,the branches of Henan,Hubei,Hunan,Guangdong,Shenzhen,Guangxi and HainanCompany LawThe Company Law of PRCCSRCChina Securities Regulatory CommissionEastern ChinaThe area including,for the purpose of this report,th
11、e branches of Shanghai,Jiangsu,Suzhou,Zhejiang,Ningbo,Anhui,Fujian,Jiangxi,Shandong and QingdaoHKEXHong Kong Exchanges and Clearing LimitedHong Kong Listing RulesThe Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong LimitedHong Kong Stock ExchangeThe Stock Exchange of Hong
12、 Kong Limited4H ShareOverseas-listed foreign investment share(s)in the ordinary share capital of the Bank,with a nominal value of RMB1.00 each,which are listed on the Hong Kong Stock Exchange and traded in Hong Kong dollars(Stock Code:3988)IFRSInternational Financial Reporting StandardsIndependent D
13、irectorIndependent director under the listing rules of the SSE and the Articles of Association,and independent non-executive director under the Hong Kong Listing RulesMOFMinistry of Finance,PRCNAFRNational Administration of Financial Regulation and its predecessorsNortheastern ChinaThe area includin
14、g,for the purpose of this report,the branches of Heilongjiang,Jilin,Liaoning and DalianNorthern ChinaThe area including,for the purpose of this report,the branches of Beijing,Tianjin,Hebei,Shanxi,Inner Mongolia and the Head OfficePBOCThe Peoples Bank of ChinaPRCThe Peoples Republic of ChinaRMBRenmin
15、bi,the lawful currency of PRCSFOSecurities and Futures Ordinance(Chapter 571 of the Laws of Hong Kong SAR)SSEThe Shanghai Stock ExchangeWestern ChinaThe area including,for the purpose of this report,the branches of Chongqing,Sichuan,Guizhou,Yunnan,Shaanxi,Gansu,Ningxia,Qinghai,Tibet and Xinjiang5The
16、 Board of Directors,the Board of Supervisors,directors,supervisors and senior management members of the Bank warrant that the information in this report is authentic,accurate and complete,contains no false record,misleading statement or material omission,and jointly and severally accept full respons
17、ibility for the information in this report.The 2023 Interim Report and Interim Results Announcement of the Bank have been reviewed and approved at the meeting of the Board of Directors of the Bank held on 30 August 2023.The number of directors who should attend the meeting is 13,with 11 directors at
18、tending the meeting in person.Vice Chairman,Executive Director Mr.LIU Jin did not attend the meeting in person due to other important business engagements and appointed Executive Director Mr.LIN Jingzhen as his authorised proxy to attend and vote on his behalf.Independent Director Mr.E Weinan did no
19、t attend the meeting in person due to other important business engagements and appointed Independent Director Mr.JIANG Guohua as his authorised proxy to attend and vote on his behalf.13 directors of the Bank exercised their voting rights at the meeting.The supervisors and senior management members o
20、f the Bank attended the meeting as non-voting attendees.The 2023 interim financial statements prepared by the Bank in accordance with CAS and IFRS have been reviewed by PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers in accordance with Chinese and international standards on review e
21、ngagements,respectively.Legal Representative and Chairman of the Board of Directors GE Haijiao,Vice President ZHANG Yi,who is also responsible for the Banks finance and accounting,and General Manager of the Financial Management Department DONG Zonglin,warrant the authenticity,accuracy and completene
22、ss of the financial statements in this report.As considered and approved by the 2022 Annual General Meeting,the Bank distributed the 2022 cash dividend of RMB2.32 per ten shares(before tax)to ordinary shareholders whose names appeared on the register of members of the Bank as at market close on 14 J
23、uly 2023,amounting to approximately RMB68.298 billion(before tax)in total.The Bank did not distribute an interim dividend on ordinary shares for 2023,nor did it propose any capitalisation of capital reserve into share capital.During the reporting period,there was no misappropriation of the Banks fun
24、ds by its controlling shareholder or other related parties for non-operating purposes and no material guarantee business that violated the applicable regulations and procedures.Important NoticeThis report may contain forward-looking statements that involve risks and future plans.These forward-lookin
25、g statements are based on the Banks own information and information from other sources that the Bank believes to be reliable.They relate to future events or the Banks future financial,business or other performance and are subject to a number of factors and uncertainties that may cause the actual res
26、ults to differ materially.Any future plans mentioned do not constitute a substantive commitment by the Bank to its investors.Investors and people concerned should be fully aware of the risks and understand the differences between plans,forecast and commitment.The Bank is faced with risks arising fro
27、m changes in the macroeconomic environment and from political and economic conditions in different countries and regions as well as risks arising from its day-to-day operations,including the risk arising from changes in the credit status of borrowers,adverse changes in market prices and operational
28、risk.It shall at the same time meet regulatory and compliance requirements.The Bank actively adopts adequate measures to effectively manage all types of risks.Please refer to the section“Management Discussion and Analysis Risk Management”for details.6Corporate InformationRegistered Name in Chinese中國
29、銀行股份有限公司(“中國銀行”)Registered Name in EnglishBANK OF CHINA LIMITED(“Bank of China”)Legal Representative and ChairmanGE HaijiaoVice Chairman and PresidentLIU JinListing Affairs RepresentativeYU KeOffice Address:No.1 Fuxingmen Nei Dajie,Xicheng District,Beijing,ChinaTelephone:(86)10-6659 2638E-mail:Regis
30、tered AddressNo.1 Fuxingmen Nei Dajie,Xicheng District,Beijing,ChinaOffice AddressNo.1 Fuxingmen Nei Dajie,Xicheng District,Beijing,China,100818Telephone:(86)10-6659 6688Facsimile:(86)10-6601 6871Website:Customer Service and Complaint Hotline:(86)Area Code-95566Place of Business in Hong Kong SARBank
31、 of China Tower,1 Garden Road,Central,Hong Kong,ChinaSelected Newspapers for Information Disclosure(A Share)China Securities Journal,Shanghai Securities News,Securities Times,Securities DailyWebsite of the SSE for Publication of the Interim RWebsite of the HKEX for Publication of the Interim Reportw
32、ww.hkexnews.hkPlace where Interim Report Can Be ObtainedHead Office of Bank of China LimitedShanghai Stock ExchangeRegistered CapitalRMB294,387,791,241Securities InformationA ShareShanghai Stock ExchangeStock Name:中國銀行Stock Code:601988H ShareThe Stock Exchange of Hong Kong LimitedStock Name:Bank of
33、ChinaStock Code:3988Domestic Preference ShareShanghai Stock ExchangeThird TrancheStock Name:中行優3Stock Code:360033Fourth TrancheStock Name:中行優4Stock Code:3600357Offshore Preference Share Second TrancheThe Stock Exchange of Hong Kong LimitedStock Name:BOC 20USDPREFStock Code:4619A-Share RegistrarShang
34、hai Branch of China Securities Depository and Clearing Corporation LimitedOffice Address:188 South Yanggao Road,Pudong New Area,Shanghai,ChinaTelephone:(86)21-4008 058 058H-Share RegistrarComputershare Hong Kong Investor Services LimitedOffice Address:17M Floor,Hopewell Centre,183 Queens Road East,W
35、an Chai,Hong Kong,ChinaTelephone:(852)2862 8555Facsimile:(852)2865 0990Domestic Preference Share RegistrarShanghai Branch of China Securities Depository and Clearing Corporation LimitedOffice Address:188 South Yanggao Road,Pudong New Area,Shanghai,ChinaTelephone:(86)21-4008 058 0588Note:The financia
36、l information in this report has been prepared in accordance with IFRS.The data are presented in RMB and reflect amounts related to the Group,unless otherwise noted.Unit:RMB millionNoteFor the six-month period ended 30 June 2023For the six-month period ended 30 June 2022(after restatement)For the si
37、x-month period ended 30 June 2022(before restatement)For the six-month period ended 30 June 2021Results of operationsNet interest income233,992223,380223,993208,773Non-interest income285,71570,14289,61894,082Operating income319,707293,522313,611302,855Operating expenses(104,300)(89,777)(108,912)(102
38、,357)Impairment losses on assets3(60,581)(52,725)(52,810)(52,945)Operating profit154,826151,020151,889147,553Profit before income tax154,919151,200152,069148,302Profit for the period127,688123,555124,303118,547Profit attributable to equity holders of the Bank120,095119,165119,924112,813Net cash flow
39、s from operating activities635,282(135,438)(126,740)688,576Basic earnings per share(RMB)0.370.370.370.36Key financial ratiosReturn on average total assets(%)40.850.900.910.93Return on average equity(%)510.6011.5611.6211.97Net interest margin(%)61.671.761.761.76Non-interest income to operating income
40、(%)726.8123.9028.5831.07Cost to income ratio(calculated under regulations in the Chinese mainland,%)825.7726.3425.0824.06Credit cost(%)90.680.560.560.65As at 30 June 2023As at 31 December 2022(after restatement)As at 31 December 2022(before restatement)As at 31 December 2021Statement of financial po
41、sitionTotal assets31,085,24028,893,54828,913,85726,722,408Loans,gross19,264,68417,552,76117,554,32215,712,574Allowance for loan impairment losses10(465,108)(437,241)(437,241)(390,541)Investments116,732,6276,435,2446,445,7436,164,671Total liabilities28,423,47726,330,24726,346,28624,371,855Due to cust
42、omers22,449,31420,201,82520,201,82518,142,887Capital and reserves attributable to equity holders of the Bank2,515,4642,423,9732,427,5892,225,153Share capital294,388294,388294,388294,388Net assets per share(RMB)127.196.986.996.47Capital ratios13Net common equity tier 1 capital2,049,4681,991,3421,991,
43、3421,843,886Net additional tier 1 capital411,673381,648381,648329,845Net tier 2 capital648,903573,481573,481525,108Common equity tier 1 capital adequacy ratio(%)11.2911.8411.8411.30Tier 1 capital adequacy ratio(%)13.5614.1114.1113.32Capital adequacy ratio(%)17.1317.5217.5216.53Asset qualityCredit-im
44、paired loans to total loans(%)141.281.321.321.33Non-performing loans to total loans(%)151.281.321.321.33Allowance for loan impairment losses to non-performing loans(%)16188.39188.73188.73187.05Allowance for loan impairment losses to total loans(%)172.422.502.502.49Financial Highlights9Notes:1 The Gr
45、oup has adopted International Financial Reporting Standard No.17 Insurance Contracts(“IFRS 17”)as issued by the International Accounting Standards Board(“IASB”)with the initial application date 1 January 2023,which resulted in restatement of the comparative figures for the previous period starting f
46、rom 1 January 2022 in accordance with the transitional provisions of IFRS 17.In this report,relevant comparative figures starting from 1 January 2022 have been restated accordingly.Comparative figures for other periods have not been restated.2 Non-interest income=net fee and commission income+net tr
47、ading gains/(losses)+net gains/(losses)on transfers of financial assets+other operating income.3 Impairment losses on assets=Credit impairment losses+Impairment losses on other assets.4 Return on average total assets=profit for the period average total assets 100%,annualised.Average total assets=(to
48、tal assets at the beginning of reporting period+total assets at the end of reporting period)2.5 Return on average equity=profit attributable to ordinary shareholders of the Bank weighted average capital and reserves attributable to ordinary shareholders of the Bank 100%,annualised.Calculation is bas
49、ed on No.9 Preparation and Reporting Rules of Information Disclosure of Public Offering Companies Calculation and Disclosure of Return on Average Equity and Earnings per Share(Revised in 2010)(CSRC Announcement 2010 No.2)issued by the CSRC.6 Net interest margin=net interest income average balance of
50、 interest-earning assets 100%,annualised.Average balance is average daily balance derived from the Groups management accounts(unreviewed).7 Non-interest income to operating income=non-interest income operating income 100%.8 Cost to income ratio is calculated in accordance with the Measures of the Pe
51、rformance Evaluation of Financial Enterprises(Cai Jin 2016 No.35)formulated by the MOF.9 Credit cost=impairment losses on loans average balance of loans 100%,annualised.Average balance of loans=(balance of loans at the beginning of reporting period+balance of loans at the end of reporting period)2.T
52、otal loans are exclusive of accrued interest when being used to calculate credit cost.10 Allowance for loan impairment losses=allowance for loans at amortised cost+allowance for loans at fair value through other comprehensive income.11 The investments include financial assets at fair value through p
53、rofit or loss,financial assets at fair value through other comprehensive income and financial assets at amortised cost.12 Net assets per share=(capital and reserves attributable to equity holders of the Bank at the end of reporting period other equity instruments)number of ordinary shares in issue a
54、t the end of reporting period.13 The capital ratios are calculated in accordance with the Capital Rules for Commercial Banks(Provisional)(Y.J.H.L.2012 No.1)and related regulations,under the Advanced Approaches.14 Credit-impaired loans to total loans=credit-impaired loans at the end of reporting peri
55、od total loans at the end of reporting period 100%.Total loans are exclusive of accrued interest when being used to calculate credit-impaired loans to total loans.15 Non-performing loans to total loans=non-performing loans at the end of reporting period total loans at the end of reporting period 100
56、%.Total loans are exclusive of accrued interest when being used to calculate non-performing loans to total loans.16 Allowance for loan impairment losses to non-performing loans=allowance for loan impairment losses at the end of reporting period non-performing loans at the end of reporting period 100
57、%.Total loans are exclusive of accrued interest when being used to calculate allowance for loan impairment losses to non-performing loans.17 Allowance for loan impairment losses to total loans=allowance for loan impairment losses at the end of reporting period total loans at the end of reporting per
58、iod 100%.Total loans are exclusive of accrued interest when being used to calculate allowance for loan impairment losses to total loans.10Business OverviewSince the beginning of 2023,amid a complex and challenging external environment,the Bank has faithfully implemented the decisions and plans of th
59、e CPC Central Committee,pressed ahead with reform and prioritised high-quality development,and devoted substantial efforts to serving the real economy,preventing and mitigating risks,and advancing reform and innovation.As a result,it made fresh progress in business development and improved its finan
60、cial performance.Improving development quality and efficiency while gaining ground in financial performanceThe Bank continued to pursue growth while ensuring stability and worked consistently to improve its development quality and efficiency.Its assets and liabilities continuously grew,financial per
61、formance steadily improved,and key financial indicators were kept within a reasonable range.As at 30 June 2023,the Groups total assets stood at RMB31,085.240 billion,up 7.59%compared with the prior year-end.Total liabilities amounted to RMB28,423.477 billion,up 7.95%compared with the prior year-end.
62、In the first half of 2023,the Group recorded operating income of RMB319.707 billion and a profit for the period of RMB127.688 billion,up 8.92%and 3.35%respectively compared with the same period of the prior year.Return on average total assets(ROA)was 0.85%and return on average equity(ROE)was 10.60%.
63、Net interest margin was 1.67%and the cost to income ratio(calculated in accordance with regulations in the Chinese mainland)was 25.77%.Proactively aligning with the strategies and priorities of the country and making new breakthroughs in serving high-quality developmentUpholding the political and pe
64、ople-centred nature of financial work,the Bank focused on serving the real economy and strengthened support to the key areas and weak links of economy.It fully supported the construction of a modern industrial system,increasing its loans to strategic emerging industries and medium and long-term loan
65、s to manufacturing sector by 45.46%and 22.56%respectively from the prior year-end.Its balance of green loans exceeded RMB2.62 trillion,up nearly 31.99%from the prior year-end.The Bank promoted the regional development strategies,with loan growth in key regions such as the Beijing-Tianjin-Hebei regio
66、n,Yangtze River Delta and Guangdong-Hong Kong-Macao Greater Bay Area outpacing the Banks overall loan growth rate.It contributed to the development of inclusive finance and implemented rural revitalisation strategies.Its balance of inclusive loans to micro and small-sized enterprises1 topped RMB1.55
67、 trillion,up 40.35%compared with the same period of the prior year,while its balance of agriculture-related loans grew by 16.75%compared with the beginning of the year and the balance of rural infrastructure loans grew by 31.86%compared with the prior year-end.The Bank granted more than USD290.0 bil
68、lion of credit facilities to projects in countries involved in the Belt and Road Initiative(BRI),contributing to new achievements in the high-quality development of BRI.It also maintained the largest market share in cross-border RMB settlement and clearing volumes,as well as in the number of RMB Cro
69、ss-Border Interbank Payment System(CIPS)direct participants and indirect participants.1 Inclusive finance loans granted to micro and small-sized enterprises are measured in accordance with the Circular of the General Office of China Banking and Insurance Regulatory Commission on Further Strengthenin
70、g the Quality of Financial Services for Micro and Small-sized Enterprises in 2023(Yin Bao Jian Ban Fa 2023 No.42).11Further consolidating the customer base,making new progress in both quality and quantityThe Bank devoted full efforts to serving its customers and strived to improve the compatibility,
71、comprehensiveness and convenience of its financial services.In this way,it enhanced both the quality and quantity of its customer base.Giving full play to finances pivotal role in resource allocation,the Bank provided targeted and effective customer services to meet the diverse needs of different in
72、dustries and customer groups,thereby continually elevating customer satisfaction.It guided relationship managers to uphold a“product neutral”approach and ensured comprehensive product promotion coverage.In terms of corporate banking,it attached equal importance to micro,small,medium and large-sized
73、customers and promoted coordinated expansion of customer accounts.In personal banking,the Bank focused on activating new customers,nurturing regular customers and retaining existing customers so as to consolidate its customer base and accelerate the onboarding of new customers.To meet customer needs
74、,it promoted product innovation,process optimisation and scenario integration in a coordinated manner while increasing financial support to the clothing,food,housing,transportation,shopping,recreation,education and health sectors,thus making its financial services more convenient.As at 30 June 2023,
75、the number of active corporate and personal customers increased by 10.52%and 4.85%respectively year on year.Reinforcing its characteristic advantages and driving new progress in globalised and integrated operationsThe Bank strengthened its advantages in globalised operations and expanded its market
76、share in domestic foreign-currency corporate deposits and loans,international trade settlement and overseas institutional deposits.The Bank ranked first in the market in terms of global underwriting volumes for HKD-denominated bonds.It further consolidated its leading position in featured businesses
77、 such as Panda bonds,offshore China bonds and Cross-Boundary Wealth Management Connect.It refined its professional capabilities in customer segmentation to sharpen its diversified competitive advantages.In the first half of the year,the Banks comprehensive operation companies showed solid recovery m
78、omentum.BOC Wealth Managements asset management scale,BOC Fullerton Community Banks deposit and loan scale,BOC Consumer Finances loan scale and the insurance premium scale of BOCG Insurance,BOC Insurance and BOC-Samsung Life all grew in terms of market share.12Adhering to the guiding role of technol
79、ogy and making new progress in innovation and digital transformationThe Bank focused on key and core technologies,advanced digital transformation in all aspects and supported the modernisation of the industrial system.It expedited the building of its enterprise-level architectures and successfully c
80、ompleted the nationwide implementation of new-generation debit card and credit card systems.It re-engineered and upgraded the Groups integrated anti-money laundering(AML)system,and rolled out a total of 23 related application components.The Bank further reinforced its technological foundations,intro
81、duced its new multi-centre basic platform in four initial locations,and migrated 23 thousand servers to a cloud-based system.It achieved promising early results in the application of its enterprise-level technological platform,with its distributed structure handling more than 2 billion transactions
82、per day.The Bank continued to advance outlet transformation and data governance,establishing over 5,000 featured outlets for key businesses.Strengthening comprehensive risk control and improving risk management capabilityThe Bank refined its risk management system,accelerated the building of intelli
83、gent risk control system,and integrated non-traditional risks into its comprehensive risk management system,such as internet and data security risks and employee and production safety risks.It effectively managed credit risk and intensified customer credit risk identification and potential risk reso
84、lution,thus steadily advancing the disposal of non-performing assets.As at 30 June 2023,the Groups non-performing loans(NPLs)totalled RMB246.882 billion,the NPL ratio was 1.28%,and the coverage ratio of allowance for loan impairment losses to NPLs was 188.39%.The Bank responded effectively to market
85、 fluctuations,improved its ability to monitor market dynamics,kept liquidity risk and market risk under overall control,and maintained major risk indicators at a stable level.It continually improved its operational risk management capabilities and consolidated the foundations of its AML and sanction
86、s compliance management,fostering a strong compliance culture that supports robust business development.Steadily replenishing capital from external sources,the Bank successfully issued RMB30.0 billion of undated capital bonds and RMB60.0 billion of tier 2 capital bonds in the first half of 2023,furt
87、her enhancing its capital strength.13Management Discussion and AnalysisFINANCIAL REVIEWEconomic and Financial EnvironmentIn the first half of 2023,the global economy outperformed expectations although the economic outlook is now skewed towards downside risks.The gradual recovery of the global supply
88、 chain eased inflationary pressures in some economies.The US economy maintained moderate growth,albeit with clear divergence between the services and manufacturing sectors.Europes economy remained in mild recession and faced a bleak outlook.Japans economy saw signs of recovery,although uncertainties
89、 persist regarding its future trajectory.Exports from emerging economies declined,with some facing sovereign debt pressures.International financial markets experienced a volatile adjustment period.Major economies continued to tighten their monetary policies,albeit at a slower pace.Market interest ra
90、tes crept up,putting pressure on global liquidity.The US dollar index remained strong,while the currencies of some emerging economies faced greater depreciation pressures.Global stock markets witnessed divergent performance,amid sluggish growth and tight money supply.Government bond yields soared wo
91、rldwide,with the inversion of long and short-end US treasury yields deepening further.The Chinese government promoted high-quality economic development and put in place macro policies designed to ensure stability while seeking progress through coordinated efforts.Production demand steadily improved,
92、employment and commodity prices were generally stable,and economic operations continued to recover.In the first half of 2023,Chinas gross domestic product(GDP)grew by 5.5%year-on-year,value-added of industrial enterprises above a designated size increased by 3.8%year-on-year,total retail sales of co
93、nsumer goods(TRSCG)grew by 8.2%year-on-year,total fixed asset investments(TFAI)(excluding those by rural households)increased by 3.8%year-on-year,and total exports climbed by 3.7%year-on-year(in RMB terms),with a trade surplus of RMB2.82 trillion.The consumer price index(CPI)rose by 0.7%year-on-year
94、.The PBOC implemented a sound monetary policy in a targeted and effective manner and stood firm in contributing to the overall recovery of the economy.Chinas financial markets operated smoothly,liquidity was kept at an adequate and reasonable level,and RMB exchange rates remained generally stable at
95、 an adaptive and equilibrium level.As at 30 June 2023,the outstanding broad money supply(M2)grew by 11.3%year-on-year to RMB287.3 trillion.Outstanding RMB loans increased by 11.3%year-on-year to RMB230.6 trillion.Aggregate financing to the real economy(AFRE)increased by 9.0%year-on-year to RMB365.5
96、trillion.The Shanghai Stock Exchange Composite Index stood at 3,202,up 3.7%from the prior year-end.The central parity rate of RMB against USD was 7.2258,a depreciation of 3.6%compared with the prior year-end.14Chinas banking sector promoted the construction of the nations new development pattern,sup
97、ported high-quality economic development and boosted the overall recovery in economic operations.It stepped up support for key areas and weak links in the economy and increased loans to the manufacturing sector,micro and small-sized enterprises and private enterprises.It strongly supported technolog
98、ical innovation and green development,deployed more funds to strategic emerging industries such as new energy,AI and bio-manufacturing,and backed the nations efforts to achieve self-reliance and self-improvement in science and technology.The banking sector demonstrated strong risk prevention capabil
99、ities,with major risk regulatory indicators maintained within a reasonable range.As at 30 June 2023,the total assets of Chinas banking sector grew by 10.4%from the same period of the prior year to RMB406.2 trillion,while total liabilities increased by 10.8%to RMB373.6 trillion.Commercial banking ins
100、titutions recorded a profit for the period of RMB1.3 trillion,a year-on-year increase of 2.6%.As at 30 June 2023,outstanding NPLs stood at RMB3.2 trillion,the NPL ratio was 1.62%,the allowance for loan impairment losses to non-performing loans was 206.13%,and the capital adequacy ratio was 14.66%.In
101、come Statement AnalysisThe Bank adhered to the principle of pursuing progress while ensuring stability,thus making steady progress in business performance.In the first half of 2023,the Group achieved a profit for the period of RMB127.688 billion,an increase of 3.35%compared with the same period of t
102、he prior year.It realised a profit attributable to equity holders of the Bank of RMB120.095 billion,an increase of 0.78%compared with the same period of the prior year.Return on average total assets(ROA)was 0.85%and return on average equity(ROE)was 10.60%.The principal components and changes of the
103、Groups consolidated income statement are set forth below:Unit:RMB million,except percentagesItemsFor the six-month period ended30 June 2023For the six-month period ended30 June 2022ChangeChange(%)Net interest income233,992223,38010,6124.75%Non-interest income85,71570,14215,57322.20%Including:net fee
104、 and commission income46,37644,4461,9304.34%Operating income319,707293,52226,1858.92%Operating expenses(104,300)(89,777)(14,523)16.18%Impairment losses on assets(60,581)(52,725)(7,856)14.90%Operating profit154,826151,0203,8062.52%Profit before income tax154,919151,2003,7192.46%Income tax expense(27,
105、231)(27,645)414(1.50%)Profit for the period127,688123,5554,1333.35%Profit attributable to equity holders of the Bank120,095119,1659300.78%15Net Interest Income and Net Interest MarginIn the first half of 2023,the Group achieved net interest income of RMB233.992 billion,an increase of RMB10.612 billi
106、on or 4.75%compared with the same period of the prior year.Specifically,interest income grew by RMB88.608 billion or 21.18%to RMB507.001 billion,and interest expense stood at RMB273.009 billion,an increase of RMB77.996 billion or 40.00%compared with the same period of the prior year.Interest IncomeI
107、n the first half of 2023,interest income on loans was RMB367.920 billion,an increase of RMB55.995 billion or 17.95%compared with the same period of the prior year,which was primarily attributable to increases in loan scale and interest rates of foreign currency loans.Interest income on investments a
108、mounted to RMB91.141 billion,an increase of RMB11.896 billion or 15.01%compared with the same period of the prior year,mainly attributable to increases in investment scale and the interest rate of foreign currency investments.Interest income on balances with central banks and due from and placements
109、 with banks and other financial institutions was RMB47.940 billion,an increase of RMB20.717 billion or 76.10%compared with the same period of the prior year,mainly due to the interest rate rises.Interest ExpenseIn the first half of 2023,interest expense on due to customers was RMB212.538 billion,an
110、increase of RMB70.032 billion or 49.14%compared with the same period of the prior year,primarily attributable to higher interest rates on foreign currency deposits.Interest expense on due to and placements from banks and other financial institutions was RMB38.637 billion,an increase of RMB8.110 bill
111、ion or 26.57%compared with the same period of the prior year,mainly due to higher interest rates.Interest expense on bonds issued was RMB21.834 billion,a decrease of RMB0.146 billion or 0.66%compared with the same period of the prior year,which was mainly due to lower interest rates.16Net Interest M
112、arginIn the first half of 2023,the Groups net interest margin was 1.67%,a decrease of 9 basis points compared with the same period of the prior year.The average interest rate of the Groups interest-earning assets increased by 32 basis points.This was mainly attributable to an increase in the interes
113、t rates of the Groups foreign currency assets owing to interest rate rises in overseas markets.In addition,the proportion of the average balance of RMB medium and long-term loans within its total RMB loans in the Chinese mainland was 74.84%,up by 0.13 percentage points compared with the same period
114、of the prior year.Conversely,the average interest rate of domestic RMB assets declined,due to a lower loan prime rate(LPR).The average interest rate of the Groups interest-bearing liabilities increased by 47 basis points,primarily because rising foreign currency interest rates pushed up the interest
115、 rates of foreign currency liabilities.The Bank continued to strengthen funding cost control,realising a steady decrease in the interest rate of domestic RMB liabilities.The average balances2 and average interest rates of the major interest-earning assets and interest-bearing liabilities of the Grou
116、p,as well as the impact on interest income/expense of variances in the volume factor and the interest rate factor3,are summarised in the following table:Unit:RMB million,except percentagesFor the six-month period ended 30 June 2023For the six-month period ended 30 June 2022Analysis of changes in int
117、erest income/expenseItemsAverage balanceInterest income/expenseAverage interest rateAverage balanceInterest income/expenseAverage interest rateVolume factorInterest rate factorTotal Interest-earning assetsLoans18,302,776367,9204.05%16,311,192311,9253.86%38,12217,87355,995Investments5,918,38591,1413.
118、11%5,523,09979,2452.89%5,6656,23111,896Balances with central banks and due from and placements with banks and other financial institutions4,100,46147,9402.36%3,790,81627,2231.45%2,22618,49120,717Total28,321,622507,0013.61%25,625,107418,3933.29%46,01342,59588,608Interest-bearing liabilitiesDue to cus
119、tomers20,959,921212,5382.04%18,410,058142,5061.56%19,72550,30770,032Due to and placements from banks and other financial institutions3,464,05638,6372.25%3,850,59530,5271.60%(3,067)11,1778,110Bonds issued1,435,65021,8343.07%1,416,22321,9803.13%302(448)(146)Total25,859,627273,0092.13%23,676,876195,013
120、1.66%16,96061,03677,996Net interest income233,992223,38029,053(18,441)10,612Net interest margin1.67%1.76%(9)BpsNotes:1 Investments include debt securities at fair value through other comprehensive income,debt securities at amortised cost,investment trusts and asset management plans,etc.2 Balances wi
121、th central banks and due from and placements with banks and other financial institutions include mandatory reserves,surplus reserves,other placements with central banks and due from and placements with banks and other financial institutions.3 Due to and placements from banks and other financial inst
122、itutions include due to and placements from banks and other financial institutions,due to central banks and other funds.2 Average balances are average daily balances derived from the Groups management accounts(unreviewed).3 The impact on interest income/expense of variances in the volume factor is c
123、alculated based on the changes in average balances of interest-earning assets and interest-bearing liabilities during the reporting period.The impact on interest income/expense of variances in the interest rate factor is calculated based on the changes in the average interest rates of interest-earni
124、ng assets and interest-bearing liabilities during the reporting period.The impact relating to the combined changes in both the volume factor and the interest rate factor has been classified as a change in the interest rate factor.17The average balances and average interest rates of loans and due to
125、customers in the Chinese mainland,classified by business type,are summarised in the following table:For thesix-month period ended 30 June 2023For thesix-month period ended 30 June 2022ChangeItemsAveragebalanceAverageinterestrateAveragebalanceAverageinterestrateAveragebalanceAverageinterestrate RMB b
126、usinesses in the Chinese mainlandUnit:RMB million,except percentagesLoansCorporate loans8,731,3173.59%7,255,9174.03%1,475,400(44)BpsPersonal loans5,679,8614.62%5,509,1104.89%170,751(27)BpsTrade bills509,9171.54%371,9732.17%137,944(63)BpsTotal14,921,0953.91%13,137,0004.34%1,784,095(43)BpsIncluding:Me
127、dium and long-term loans11,167,1364.25%9,814,9194.73%1,352,217(48)BpsShort-term loans within 1 year and others3,753,9592.90%3,322,0813.17%431,878(27)BpsDue to customersCorporate demand deposits4,342,8601.03%3,881,7430.90%461,11713 BpsCorporate time deposits3,226,8172.64%2,785,4532.82%441,364(18)BpsP
128、ersonal demand deposits2,800,1850.24%2,513,6010.33%286,584(9)BpsPersonal time deposits5,079,1962.74%4,034,7552.99%1,044,441(25)BpsOther776,9662.98%767,1213.16%9,845(18)BpsTotal16,226,0241.84%13,982,6731.91%2,243,351(7)BpsForeign currency businesses in the Chinese mainlandUnit:USD million,except perc
129、entagesLoans47,6244.05%55,9641.21%(8,340)284 BpsDue to customersCorporate demand deposits57,3291.66%81,2800.16%(23,951)150 BpsCorporate time deposits45,5694.25%39,4420.60%6,127365 BpsPersonal demand deposits24,2720.02%27,0340.01%(2,762)1 BpPersonal time deposits17,5401.33%15,7810.33%1,759100 BpsOthe
130、r2,2011.92%3,1941.52%(993)40 BpsTotal146,9112.16%166,7310.28%(19,820)188 BpsNote:“Due to customers Other”includes structured deposits.18Non-interest IncomeIn the first half of 2023,the Group reported non-interest income of RMB85.715 billion,an increase of RMB15.573 billion or 22.20%compared with the
131、 same period of the prior year.Non-interest income represented 26.81%of operating income.Net Fee and Commission IncomeThe Group achieved net fee and commission income of RMB46.376 billion,an increase of RMB1.930 billion or 4.34%compared with the same period of the prior year.Net fee and commission i
132、ncome represented 14.51%of operating income.The Bank proactively seized opportunities arising from the economic recovery and rapidly expanded its business scale,realising growth in fees income from businesses such as bank card and consultancy and advisory business.Please refer to Note III.2 to the C
133、ondensed Consolidated Interim Financial Statements.Other Non-interest IncomeThe Group realised other non-interest income of RMB39.339 billion,an increase of RMB13.643 billion or 53.09%compared with the same period of the prior year.This was primarily attributable to a rapid increase in net trading g
134、ain,due to fluctuations in market interest rates and exchange rates.Please refer to Notes III.3,4,5 to the Condensed Consolidated Interim Financial Statements.Operating ExpensesIn the first half of 2023,the Groups operating expenses amounted to RMB104.300 billion,an increase of RMB14.523 billion or
135、16.18%compared with the same period of the prior year.The Groups cost to income ratio(calculated in accordance with regulations in the Chinese mainland)was 25.77%,a decrease of 0.57 percentage points compared with the same period of the prior year,remaining at a relatively low level.The Bank continu
136、ed to operate its business in a prudent manner.It proactively optimised its cost structure,focused on refined management,allocated more resources to key areas and regions,and enhanced input and output efficiency.Please refer to Notes III.6,7 to the Condensed Consolidated Interim Financial Statements
137、.Impairment Losses on AssetsIn the first half of 2023,the Groups impairment losses on assets totalled RMB60.581 billion,an increase of RMB7.856 billion or 14.90%compared with the same period of the prior year.Specifically,impairment losses on loans and advances amounted to RMB61.997 billion,an incre
138、ase of RMB16.421 billion or 36.03%compared with the same period of the prior year.The Bank continued to improve its comprehensive risk management system and maintained a proactive and forward-looking approach to risk management,ensuring relatively stable credit asset quality.At the same time,it rigo
139、rously implemented a prudent and solid risk provisioning policy to maintain an adequate risk resistance capability.Please refer to the section“Risk Management Credit Risk Management”and Notes III.8,16 and Note IV.1 to the Condensed Consolidated Interim Financial Statements for more information on lo
140、an quality and the allowance for loan impairment losses.19Financial Position AnalysisThe Bank followed requirements on high-quality development,remained committed to the nations new development philosophy,dynamically adjusted its business strategies and continually improved its business structure,th
141、us achieving steady growth in assets and liabilities.As at 30 June 2023,the Groups total assets amounted to RMB31,085.240 billion,an increase of RMB2,191.692 billion or 7.59%compared with the prior year-end.The Groups total liabilities amounted to RMB28,423.477 billion,an increase of RMB2,093.230 bi
142、llion or 7.95%compared with the prior year-end.The principal components of the Groups consolidated statement of financial position are set out below:Unit:RMB million,except percentagesAs at 30 June 2023As at 31 December 2022ItemsAmount%of totalAmount%of totalAssetsLoans and advances to customers,net
143、18,799,93960.48%17,116,00559.24%Investments6,732,62721.66%6,435,24422.27%Balances with central banks2,351,1567.56%2,313,8598.01%Due from and placements with banks and other financial institutions2,027,5676.52%1,924,4546.66%Other assets1,173,9513.78%1,103,9863.82%Total assets31,085,240100.00%28,893,5
144、48100.00%LiabilitiesDue to customers22,449,31478.98%20,201,82576.72%Due to and placements from banks and other financial institutions and due to central banks3,571,05112.56%3,622,51613.76%Other borrowed funds1,325,6794.66%1,565,8405.95%Other liabilities1,077,4333.80%940,0663.57%Total liabilities28,4
145、23,477100.00%26,330,247100.00%Note:“Other borrowed funds”includes bonds issued and other borrowings.20Loans and Advances to CustomersThe Bank diligently fulfilled its responsibilities as a large state-owned bank and increased its credit support to the real economy,achieving solid growth in its lendi
146、ng business.It served nations regional development strategies,reinforced its support for the building of a modern industrial system and the development of key areas such as inclusive finance,green finance,strategic emerging industries,manufacturing and rural revitalisation,while continually improvin
147、g its credit structure.As at 30 June 2023,the Groups loans and advances to customers amounted to RMB19,264.684 billion,an increase of RMB1,711.923 billion or 9.75%compared with the prior year-end.Specifically,RMB loans and advances to customers totalled RMB15,831.376 billion,an increase of RMB1,488.
148、406 billion or 10.38%compared with the prior year-end,while its foreign currency loans amounted to USD475.146 billion,an increase of USD14.274 billion or 3.10%compared with the prior year-end.The Bank continually improved its comprehensive risk management framework,closely monitored changes in the m
149、acroeconomic situation,effectively strengthened risk identification and control in key areas,and stepped up efforts to dispose of non-performing assets(NPAs),thus maintaining relatively stable asset quality.As at 30 June 2023,the balance of the Groups allowance for loan impairment losses amounted to
150、 RMB465.108 billion,an increase of RMB27.867 billion compared with the prior year-end.The balance of the Groups restructured NPLs amounted to RMB42.350 billion,an increase of RMB13.933 billion compared with the prior year-end.The structure of the Groups loans and advances to customers is set out bel
151、ow:Unit:RMB million,except percentagesAs at 30 June 2023As at 31 December 2022ItemsAmount%of totalAmount%of totalCorporate loansChinese mainland:RMB9,922,52351.51%8,523,46348.56%Foreign currency378,0681.96%295,1211.68%Hong Kong(China),Macao(China),Taiwan(China)and other countries and regions2,390,16
152、312.41%2,280,23912.99%Subtotal12,690,75465.88%11,098,82363.23%Personal loansChinese mainland:RMB5,740,96829.80%5,681,11032.36%Foreign currency1,2970.01%1,0890.01%Hong Kong(China),Macao(China),Taiwan(China)and other countries and regions779,6884.04%724,7714.13%Subtotal6,521,95333.85%6,406,97036.50%Ac
153、crued interest51,9770.27%46,9680.27%Total loans19,264,684100.00%17,552,761100.00%21InvestmentsThe Bank closely tracked domestic and overseas financial market dynamics in order to capture opportunities from market timing and adjusted portfolio dynamically.As at 30 June 2023,the Group held investments
154、 of RMB6,732.627 billion,an increase of RMB297.383 billion or 4.62%compared with the prior year-end.Specifically,the Groups RMB investments totalled RMB5,110.852 billion,an increase of RMB104.674 billion or 2.09%compared with the prior year-end,while foreign currency investments totalled USD224.442
155、billion,an increase of USD19.252 billion or 9.38%compared with the prior year-end.The classification of the Groups investment portfolio is shown below:Unit:RMB million,except percentagesAs at 30 June 2023As at 31 December 2022ItemsAmount%of totalAmount%of totalFinancial assets at fair value through
156、profit or loss594,5638.83%613,1059.53%Financial assets at fair value through other comprehensive income2,853,17142.38%2,500,21638.85%Financial assets at amortised cost3,284,89348.79%3,321,92351.62%Total6,732,627100.00%6,435,244100.00%Investments by CurrencyUnit:RMB million,except percentagesAs at 30
157、 June 2023As at 31 December 2022ItemsAmount%of totalAmount%of totalRMB5,110,85275.91%5,006,17877.79%USD959,14314.25%832,75712.94%HKD358,2705.32%295,3464.59%Other304,3624.52%300,9634.68%Total6,732,627100.00%6,435,244100.00%22Top Ten Financial Bonds by Value Held by the GroupUnit:RMB million,except pe
158、rcentagesBond NamePar ValueAnnual RateMaturity DateImpairmentAllowanceBond issued by policy banks in 201916,4273.48%2029-01-08Bond issued by policy banks in 201915,1743.65%2029-05-21Bond issued by policy banks in 202213,2702.82%2027-06-17Bond issued by policy banks in 201812,7104.98%2025-01-12Bond i
159、ssued by policy banks in 201811,6574.88%2028-02-09Bond issued by policy banks in 201711,6504.39%2027-09-08Bond issued by policy banks in 202210,9752.50%2027-08-24Bond issued by policy banks in 201810,7304.73%2025-04-02Bond issued by policy banks in 201910,1253.75%2029-01-25Bond issued by policy bank
160、s in 20239,5402.73%2028-01-11Note:Financial bonds refer to debt securities issued by financial institutions in the bond market,including bonds issued by policy banks,other banks and non-bank financial institutions,but excluding restructured bonds and PBOC bills.Due to CustomersThe Bank optimised the
161、 balance between deposit growth and cost control while continually enhancing its financial services offering,leading to a record high in the increase of domestic RMB deposits.It actively expanded its demand deposit base by focusing on key deposit products such as salary payment agency,cash managemen
162、t,quick payment service and social security cards.It also improved the quality of its deposit business by reducing the scale of high-cost deposits such as structured deposits and negotiated deposits,resulting in a steady decrease in the funding cost of RMB deposits.As at 30 June 2023,the Groups due
163、to customers amounted to RMB22,449.314 billion,an increase of RMB2,247.489 billion or 11.13%compared with the prior year-end.Specifically,the Groups RMB due to customers totalled RMB17,696.789 billion,an increase of RMB1,817.355 billion or 11.44%compared with the prior year-end,while its foreign cur
164、rency due to customers stood at USD657.716 billion,an increase of USD37.093 billion or 5.98%compared with the prior year-end.23The structure of the Groups due to customers is set out below:Unit:RMB million,except percentagesAs at 30 June 2023As at 31 December 2022ItemsAmount%of totalAmount%of totalC
165、orporate depositsChinese mainland:RMB8,461,11837.69%7,532,87837.29%Foreign currency772,7023.44%628,4433.11%Hong Kong(China),Macao(China),Taiwan(China)and other countries and regions2,154,0449.60%1,999,6669.90%Subtotal11,387,86450.73%10,160,98750.30%Personal depositsChinese mainland:RMB8,624,30538.42
166、%7,752,56538.38%Foreign currency307,8771.37%305,6191.51%Hong Kong(China),Macao(China),Taiwan(China)and other countries and regions1,451,2486.46%1,338,5126.62%Subtotal10,383,43046.25%9,396,69646.51%Certificates of deposit and others678,0203.02%644,1423.19%Total deposits22,449,314100.00%20,201,825100.
167、00%Note:“Certificates of deposit and others”includes accrued interest.EquityAs at 30 June 2023,the Groups total equity stood at RMB2,661.763 billion,an increase of RMB98.462 billion or 3.84%compared with the prior year-end.This was primarily attributable to the following factors:(1)In the first half
168、 of 2023,the Group realised a profit for the period of RMB127.688 billion,of which profit attributable to equity holders of the Bank amounted to RMB120.095 billion.(2)The Bank pushed forward its external capital replenishment projects in a proactive and prudent manner,successfully issuing RMB30.0 bi
169、llion of undated capital bonds.(3)As per the 2022 dividend distribution plan approved at the Annual General Meeting,a cash dividend of RMB68.298 billion was paid out on ordinary shares.(4)The Bank paid a dividend on its preference shares of RMB5.162 billion and interest on undated capital bonds of R
170、MB7.025 billion.Please refer to the“Condensed Consolidated Interim Statement of Changes in Equity”in the Condensed Consolidated Interim Financial Statements.Cash Flow AnalysisAs at 30 June 2023,the balance of the Groups cash and cash equivalents was RMB2,258.245 billion,an increase of RMB166.779 bil
171、lion compared with the prior year-end.In the first half of 2023,net cash flow from operating activities was an inflow of RMB635.282 billion,as compared to an outflow of RMB135.438 billion in the same period of the prior year.This was mainly attributable to an increase in due to customers.24Net cash
172、flow from investing activities was an outflow of RMB258.776 billion,a net increase of RMB181.936 billion compared with the same period of the prior year.This was mainly attributable to a decrease in proceeds from the disposal and maturing of financial investments.Net cash flow from financing activit
173、ies was an outflow of RMB254.636 billion,as compared to an inflow of RMB77.116 billion in the same period of the prior year.This was mainly due to a decrease in proceeds from the issuance of bonds.Segment InformationThe Group manages its operations on both geographic and business segment lines.From
174、a geographic perspective,the Group operates in three principal regions:the Chinese mainland;Hong Kong(China),Macao(China)and Taiwan(China);and other countries and regions.From a business perspective,the Group provides financial services through six main business segments:corporate banking,personal b
175、anking,treasury operations,investment banking,insurance and other operations.Operating income for the main geographical segments of the Group is set forth in the following table:Unit:RMB million,except percentagesFor the six-month periodended 30 June 2023For the six-month periodended 30 June 2022Ite
176、msAmount%of totalAmount%of totalChinese mainland258,29380.27%248,23884.16%Hong Kong(China),Macao(China)and Taiwan(China)49,10015.26%35,38212.00%Other countries and regions14,3914.47%11,3353.84%Elimination(2,077)_(1,433)_Group319,707100.00%293,522100.00%Note:Percentages of operating income for each g
177、eographic segment are calculated based on the amount before elimination.Operating income for the main business segments of the Group is set forth in the following table:Unit:RMB million,except percentagesFor the six-month periodended 30 June 2023For the six-month periodended 30 June 2022ItemsAmount%
178、of totalAmount%of totalCommercial banking business298,95493.51%279,78895.32%Including:Corporate banking131,97441.28%107,87036.75%Personal banking141,03044.11%117,28739.96%Treasury operations25,9508.12%54,63118.61%Investment banking and insurance13,6154.26%4,7131.61%Others and elimination7,1382.23%9,
179、0213.07%Group319,707100.00%293,522100.00%Please refer to Note III.32 to the Condensed Consolidated Interim Financial Statements for more detailed information related to the Groups other operating results and financial position in terms of geographic and business segment categories.25Fair Value Measu
180、rementMovement of Financial Instruments Measured at Fair Value:Unit:RMB millionItemsAs at30 June2023As at31 December2022ChangePlacements with and loans to banks and other financial institutions at fair value17,24112,3334,908Financial assets at fair value through profit or lossDebt securities372,9553
181、98,100(25,145)Equity instruments106,541112,582(6,041)Fund investments and other115,067102,42312,644Loans and advances to customers at fair value576,872587,256(10,384)Financial assets at fair value through other comprehensive incomeDebt securities2,823,7152,473,380350,335Equity instruments and other2
182、9,45626,8362,620Derivative financial assets197,427152,03345,394Derivative financial liabilities(179,888)(135,838)(44,050)Due to customers at fair value(43,663)(36,701)(6,962)Bonds issued at fair value(2,149)(2,080)(69)Financial liabilities held for trading(48,365)(53,868)5,503The Bank has put in pla
183、ce a sound internal control mechanism for fair value measurement.In accordance with the Guidelines on Market Risk Management in Commercial Banks,the Regulatory Guidelines on Valuation of Financial Instruments in Commercial Banks,CAS and IFRS,with reference to the New Basel Capital Accord,and drawing
184、 on the best practices of international banks regarding valuations,the Bank formulated the Valuation Policy of Financial Instrument Fair Values of Bank of China Limited to standardise the fair value measurement of financial instruments and enable timely and accurate financial information disclosure.
185、Please refer to Note IV.4 to the Condensed Consolidated Interim Financial Statements for more detailed information related to fair value measurement.Other Financial InformationThere are no differences between the shareholders equity and profit for the period prepared by the Bank in accordance with I
186、FRS and those prepared in accordance with CAS.Please refer to Supplementary Information I to the Interim Financial Information for detailed information.26BUSINESS REVIEWDuring the reporting period,the Bank earnestly put national strategies and plans into action and pushed forward the implementation
187、of the 14th Five-Year Plan,thus ensuring sound strategic execution.It thoroughly,fully and accurately applied the nations new development philosophy in all of its endeavours and took decisive steps to deepen supply-side structural reform in the financial sector.It facilitated positive interplay with
188、in the domestic economy and between the domestic and international economic circulations,and made constant efforts to contribute to the high-quality development of the real economy.Embracing the digital era,the Bank deepened the adoption of various technologies such as big data,artificial intelligen
189、ce,and blockchain to expedite its digital transformation.Adhering strictly to bottom-line thinking in risk management,the Bank built stronger lines of defence against risks and addressed risk-related challenges,thereby reinforcing robust implementation in comprehensive risk management.Commercial Ban
190、king in the Chinese MainlandThe Banks commercial banking business in the Chinese mainland supported the nations strategic development priorities in line with its original aspiration and mission of serving the country and the public through finance.Focusing on key areas,key businesses and key project
191、s,the Bank achieved remarkable results in promoting high-quality development while serving the real economy.In the first half of 2023,the Groups commercial banking business in the Chinese mainland recorded an operating income of RMB251.849 billion,an increase of RMB9.976 billion or 4.12%compared wit
192、h the same period of the prior year.Details are set forth below:Unit:RMB million,except percentagesFor the six-month period ended 30 June 2023For the six-month period ended 30 June 2022ItemsAmount%of totalAmount%of totalCorporate banking business108,68143.15%95,83639.62%Personal banking business126,
193、17950.10%111,42946.07%Treasury operations17,8047.07%35,71214.76%Others(815)(0.32%)(1,104)(0.45%)Total251,849100.00%241,873100.00%Corporate BankingThe Bank upheld its responsibility to serve the real economy and pushed forward the transformation of its corporate financial services.It prioritised cred
194、it support for key areas such as technology innovation,green finance,inclusive finance,rural revitalisation,strategic emerging industries and manufacturing.It also proactively contributed to the systematic development of advanced manufacturing and digital economy-related industries.In addition,the B
195、ank accelerated progress towards the coordinated development of the Beijing-Tianjin-Hebei region,the Yangtze River Delta,the Guangdong-Hong Kong-Macao Greater Bay Area,the Hainan Free Trade Port and other key regions,utilising its financial resources to support major regional strategies.The Bank imp
196、lemented differentiated precision marketing and services based on the refined classification of customer groups,and consolidated its development foundations.It provided integrated service solutions covering the entire product suite of“investment,loans,bonds,equity,insurance and leasing”to meet custo
197、mers diverse financing needs.In the first half of 2023,the Groups corporate banking business in the Chinese mainland recorded an operating income of RMB108.681 billion,an increase of RMB12.845 billion or 13.40%compared with the same period of the prior year.27Corporate DepositsThe Bank adhered to sc
198、ientific classification and adopting precise measures,focused on building a comprehensive and tiered marketing management system to optimise the balance between deposit growth and cost control through scientific classification and targeted policy.Centred on customers diverse financial needs,it furth
199、er enhanced its cross-industry services,comprehensive marketing awareness and all-round service capabilities.The Bank proactively integrated into the domestic and international“dual circulation”pattern by connecting its business product channels for domestic settlement and international settlement,i
200、ncreasing business volumes in payments and settlements,and enhancing fund retention capacity.The Bank highlighted the strategic positioning of its administrative institution business,and pressed ahead with the building of a smart government services ecosystem.It strengthened the“Head Office-to-headq
201、uarters”connection,enhanced the financial service capability for related market entities,and consolidated the customer base.As at 30 June 2023,RMB corporate deposits of the Groups commercial banking business in the Chinese mainland totalled RMB8,460.910 billion,an increase of RMB928.196 billion or 1
202、2.32%compared with the prior year-end,representing the highest increase in ten years.Its market share of daily average deposits also grew.Foreign currency corporate deposits amounted to USD106.937 billion,an increase of USD16.703 billion or 18.51%compared with the prior year-end,securing the Banks l
203、eading position in the industry.Corporate LoansThe Bank actively fulfilled its responsibilities,thoroughly implemented national development strategies and improved the quality and efficiency of its service to the real economy.Serving the innovation-driven development strategy,it shifted its service
204、focus from traditional industries to new industries,new business forms and new business models,and increased credit support for strategic emerging industries,in a bid to support the establishment of modern industrial system.To serve the nations major regional strategies,the Bank supported the buildi
205、ng of key regions including the Beijing-Tianjin-Hebei region,the Yangtze River Economic Belt,the Guangdong-Hong Kong-Macao Greater Bay Area,the Yangtze River Delta,the Yellow River basin,the Chengdu-Chongqing region and Hainan,providing new impetus to the high-quality development of Chinas regional
206、economies.It supported the national strategy to expand domestic demand,advanced supply-side structural reform,strengthened its inclusive finance services,accelerated the creation of scenario-based ecosystems,and achieved breakthroughs in online products.It also contributed to the national rural revi
207、talisation strategy by providing support for agricultural modernisation and consolidating its achievements in poverty alleviation.To serve the nations ecological conservation strategy,it further boosted the expansion of green credit and improved related products and services,which in turn supported
208、the sustainable development of the economy and society and helped build the Banks brand reputation for green finance.The Bank contributed to the mutually beneficial opening-up of the Chinese economy by providing solid financial services support to the BRI countries and Chinese enterprises“Going Glob
209、al”efforts,as well as by strengthening overseas economic and trade cooperation.As at 30 June 2023,RMB corporate loans of the Banks operations in the Chinese mainland totalled RMB9,873.195 billion,an increase of RMB1,397.524 billion or 16.49%compared with the prior year-end.Foreign currency corporate
210、 loans totalled USD52.322 billion,an increase of USD9.948 billion or 23.48%compared with the prior year-end,maintaining the Banks leading position among peers.28Financial Institutions BusinessThe Bank continued to strengthen its integrated financial services platform and deepen cooperation with vari
211、ous types of financial institutions,retaining a leading position in terms of financial institution customer coverage.By the end of the first half of 2023,it has kept correspondent relationships with nearly 1,200 institutions around the world and has opened 1,438 cross-border RMB clearing accounts fo
212、r correspondent banks from 112 countries and regions,establishing itself as a leader among domestic banks.The Bank promoted the RMB Cross-Border Interbank Payment System(CIPS)and has formed indirect participant partnerships with 626 domestic and overseas financial institutions,capturing the largest
213、market share among peers.Its custodian service for Qualified Foreign Investors(QFI)and its agency service for overseas central banks and other sovereign institutions led the industry in terms of both customer base and business scale.It also ranked first in the amount under custody of bonds invested
214、by overseas institutions in the China interbank bond market(CIBM).The Bank facilitated the official launch of Swap Connect by serving as the sole major participating bank for central counterparty clearing and completed several initial participations across the Group on the first day of launch.It suc
215、cessfully launched an e-CNY programme for spot commodity clearing at Shanghai Clearing House,becoming one of the first spot commodity clearing members to provide digital currency clearing.As the main foreign exchange settlement bank under Hong Kong Stock Connect and the sole clearing bank under Shan
216、ghai Stock Connect and Shenzhen Stock Connect,the Bank supported the official launch of the optimised trading calendar of Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect,thus further enhancing stock market connectivity mechanisms between the Chinese mainland and Hong Kong.The B
217、ank also provided one-stop comprehensive financial services to the Asian Infrastructure Investment Bank(AIIB),BRICS New Development Bank(NDB)and other multilateral development institutions.Serving as lead underwriter,it assisted both the AIIB and BRICS NDB with the issuance of Panda bonds.As at 30 J
218、une 2023,the Bank maintained the largest market share in foreign currency deposits from financial institutions,and further increased its market share in terms of third-party funds under custody.Transaction BankingThe Bank fully implemented national development strategies and proactively integrated i
219、nto digitalised development wave,promoting high-quality development of transaction banking business.It stepped up efforts to stabilise scale and optimise structure of foreign trade.It enhanced both financial and non-financial support to help Chinese enterprises attract overseas business,maintained a
220、 leading market position in terms of international trade settlement,cross-border RMB settlement,cross-border guarantee and cross-border cash pooling business for domestic institutions,and achieved steady growth in import and export trade finance.It stepped up efforts in product and service innovatio
221、n to support new foreign trade patterns,achieving rapid growth in settlement volume.Collaborating at the highest level with partners,the Bank constantly sought to build financial bridges to enable foreign economic and trade cooperation.It provided high-quality services to the 3rd China International
222、 Consumer Products Expo(CICPE)and the 133rd China Import and Export Fair(Canton Fair),and fully supported preparations for the China International Import Expo(CIIE),China International Fair for Trade in Services(CIFTIS)and China International Fair for Investment and Trade(CIFIT).It accelerated the d
223、igital transformation of its transaction banking business and effectively improved its online penetration 29capabilities.Utilising its Next-generation Commercial Bill System,the Bank reconstructed business processes for services such as electronic bill acceptance,issuance,endorsement,discounting and
224、 payment,etc.,across their entire lifecycle,thus implementing a new type of full-scope processing for sub-contractable bills.To enhance scenario-based services for corporate banking,the Bank iterated and upgraded its“BOC Corporate e-Manager”service and developed a one-stop“non-financial+financial”se
225、rvice platform based on high-frequency scenarios in the daily operation and management of enterprises.It also formulated and published the Bank of China Global Digital Financial Service Solutions for Corporate Treasury Business to support the building of treasury management systems for central state
226、-owned enterprises(SOEs).Inclusive FinanceThe Bank continued to meet the specific financial needs of micro and small-sized enterprises,thus actively contributing to economic and social development.It focused on stabilising employment,ensuring peoples wellbeing and providing high-quality services to
227、the real economy.The Bank deepened long-acting mechanisms for stabilising and expanding employment,and provided RMB120.0 billion of special-purpose loans to help 27 thousand micro and small-sized enterprises stabilise and expand employment,benefiting 1.40 million workers.It enhanced financial servic
228、es for self-employed individuals and new urban residents,introducing special service plans to help new urban residents start businesses or find jobs.The Bank shored up its strategies,focused on key links and provided high-quality services in key areas.It supported the growth needs of sci-tech micro
229、and small-sized enterprises,provided lifecycle services to specialised and sophisticated enterprises involved in producing new and unique products,and boosted Chinas pursuit of self-reliance in science and technology.It provided scenario-based batch services based on“circles,chains and groups”,enhan
230、cing its ability to stabilise,strengthen and reinforce the industrial and supply chains.Through the“Micro and Small Foreign Trade Services”campaign,the Bank gave full play to its advantages in cross-border matchmaking to ensure smooth economic circulation and stable foreign trade.The Bank continuall
231、y improved products and expanded service scenarios to promote high-quality digital inclusive finance.It promoted better connection and application of external data,launched online inclusive finance products such as“E-Renewal Loan”and franchise merchant loans,and continued to improve the functions of
232、 its existing products and services.It developed a comprehensive service ecosystem for inclusive finance based on the“BOC Inclusive Finance”app.Utilising technological empowerment,the Bank developed an intelligent operation platform for inclusive finance business to enhance its service quality and e
233、fficiency.As at the end of June 2023,the Banks outstanding inclusive finance loans granted to micro and small-sized enterprises reached RMB1,550.906 billion,an increase of 40.35%compared with the same period of the prior year and an increase of 26.27%compared with the prior year-end,outpacing the gr
234、owth rate of the Banks total loans.It served nearly 0.9 million micro and small-sized business customers,up from the beginning of the year.The average interest rate of new inclusive finance loans granted to micro and small-sized enterprises in the first half of 2023 was 3.64%,and the asset quality o
235、f such loans remained stable and manageable.30Pension BusinessThe Bank actively supported national strategies to address Chinas aging population.With a focus on constructing the national elderly care security system,the Bank advanced the strategic layout of its pension business,developed and improve
236、d pension products and services for the elderly,offered a series of products including enterprise annuities and occupational annuities,and fully supported the development of the silver economy.As at 30 June 2023,pension funds held in trust by the Bank reached RMB191.684 billion,an increase of RMB21.
237、441 billion or 12.59%compared with the prior year-end.Enterprise annuity individual accounts held by the Bank reached 3.9962 million,an increase of 97.5 thousand or 2.50%compared with the prior year-end.Pension assets under custody amounted to RMB972.828 billion,an increase of RMB66.226 billion or 7
238、.30%compared with the prior year-end.The Bank provided enterprise annuity services for more than 17.6 thousand institutional clients.Digital Transformation of Corporate BankingThe Bank further empowered its management,made solid efforts to popularise its global service platform of corporate banking
239、customers,and continued to improve its platform functions.It focused on improving its differentiated management model for corporate customers and enhancing its penetrating and refined management capabilities,improving its customer service ability.In addition,it improved its big data mining capabilit
240、ies and conducted precision marketing based on customer personas.By utilising digital tools to expand,acquire and activate customers,the Bank continued to consolidate its customer base.Personal BankingThe Bank aimed to provide high-quality services for customers.Focusing on customer needs,it continu
241、ed to integrate products and services,deeply promoted digital transformation,and spared no effort to become a leading bank for delivering full-stack personal financial services.In the first half of 2023,the Banks personal banking business in the Chinese mainland realised an operating income of RMB12
242、6.179 billion,an increase of RMB14.750 billion or 13.24%compared with the same period of the prior year.Account Management BusinessBearing in mind the people-centeredness of financial work,the Bank piloted debit cards for new citizens while also providing them with inclusive,high-quality account man
243、agement services.It improved its personal pension business system by upgrading system functions across the entire lifecycle of account opening,deposit and withdrawal,and product purchase,providing customers with all-round high-quality personal pension services.31Wealth Finance BusinessAdhering to it
244、s customer-centric service philosophy,the Bank achieved steady development in its wealth management business by striving to enhance customers sense of happiness and prosperity,thus strengthening its brand reputation.As at 30 June 2023,the Groups financial assets under management for personal custome
245、rs approached RMB14 trillion,with steady growth in both the number of medium and high-end customers and the size of related financial assets under management.The Bank built a diversified wealth management product shelf,offered selected high-quality products from“Market-wide+Group-wide”,and steadily
246、expanded partnerships with wealth management companies.As at 30 June 2023,the Bank had established cooperation with 10 wealth management companies and further increased its market share among peers in terms of the balance of wealth management products for personal customers.Developing a full journey
247、 companion service model,the Bank accelerated its transformation towards services that meet customers needs before,during and after their investments.The Bank optimised“BOC Investment Strategy”,a global investment strategy information service system,covering major asset categories,which offers daily
248、,weekly,monthly,quarterly and annual reports.The Bank improved services such as“wealth classroom”,product performance review,and optimised its“Fortune”mobile banking community.It strengthened investor education and provided more supplementary services for customers holding investments.As at 30 June
249、2023,41 cooperating financial institutions covering funds,insurance,brokerage firms and wealth management were operating in the“Fortune”community.The Bank has established 8,235 wealth management centres and 1,016 prestigious wealth management centres in the Chinese mainland.Consumer Finance Business
250、The Bank continued to expand its consumer finance business and improved the quality and efficiency of its financial services to the real economy.By making timely adjustments and refinements to its housing credit policies,it provided differentiated housing credit services and supported the steady and
251、 healthy development of the real estate market.For non-housing consumer loans,it stepped up efforts to promote online migration and explored cooperation opportunities based on consumer finance scenarios,aiming to offer more accessible and convenient consumer finance services and thus stimulate consu
252、mption and domestic demand.Focusing on large-amount consumption scenarios,the Bank exerted the advantage of its featured auto instalment loans and promoted cross-selling between the corporate and retail sectors in order to support a recovery in automobile consumption,while sparing no effort to conso
253、lidate its business foundations in key consumer service areas.It integrated its“BOC E-instalment”product into strategic scenarios,developed its customer group service plan for teachers,launched a financial service plan for new urban residents,and supported various consumption upgrade needs of reside
254、nt households.The Bank also proactively implemented the interest exemption and deferred repayment policy for government-sponsored student loans,expanding the scope of services for students by promoting the integrated development of student loans granted from where the campus located and student-orig
255、in-based loans.As at 30 June 2023,the balance of personal RMB loans of the Groups commercial banking business in the Chinese mainland was RMB5,740.968 billion,an increase of RMB59.858 billion or 1.05%compared with the prior year-end.32Private Banking BusinessBy adhering to the principle of“private b
256、anking driven by the Groups strengths”,the Bank integrated various capabilities within the Group to improve its private banking product and service systems and created sustainable lifecycle wealth management solutions covering multiple scenarios.It improved its investment strategy information servic
257、e system and created tailored solutions based on individual customer needs and specific product features,thus supporting customers throughout their investment journey.The Bank accelerated growth in its family trust business,achieving an increase of 52.59%in family trust clients from the end of last
258、year.It continued to improve its“Entrepreneur Office”services and delivered agile product and service innovations covering entrepreneur clients needs,including the implementation of innovative cases such as employee share ownership plans(ESOPs)and enterprise-established charitable trusts.Moreover,th
259、e Bank enhanced its overseas private banking services and consolidated its strengths in integrated global services.It accelerated the training and development of private banking professional teams centred on private advisors and investment consultants,and now established 175 private banking centres
260、in the Chinese mainland.As at 30 June 2023,the Group had 172.9 thousand private banking customers with RMB2.69 trillion of financial assets under management.In the first half of 2023,the Banks private banking business received various awards including the“Best Private Bank National(Gold Award)”,“Bes
261、t Private Bank UHNW(Gold Award)”,and“Best Private Bank Investment Services and Research(Gold Award)”from Asian Private Banker,the“Best Private Bank for International Network”from Asiamoney and the“Jinzhen Award|Best Domestic Private Bank Customer Service”from Wealth Management.Personal Foreign Excha
262、nge BusinessThe Bank continually improved its personal foreign exchange services,accelerated product and service innovation and promoted the construction and upgrading of currency exchange systems.It also successfully achieved the digital transformation of traditional service processes.The Banks sel
263、f-service foreign exchange machines support e-CNY exchange and offer foreign exchange services in eight languages covering 21 currencies and 169 denominations.In addition,its foreign exchange cash reservation service is available in major cities in the Chinese mainland and via multiple channels such
264、 as mobile banking,WeChat banking and online banking.As at 30 June 2023,the Bank continued to lead its domestic peers in terms of personal cross-border business income,volumes of personal foreign currency exchange against RMB,and foreign currency personal deposits.It also remained the leading positi
265、on among domestic peers in terms of personal deposit-withdrawal currency coverage,offering 25 currencies,and personal foreign currency cash exchange coverage,offering 39 currencies.33Bank Card BusinessThe Bank enhanced its comprehensive service capabilities and effectively tapped into its developmen
266、t potential.It established an integrated online and offline service model for social security,optimising physical social security card services while vigorously promoting electronic social security cards.As at 30 June 2023,it had issued a total of 120.5098 million physical and 22.8215 million electr
267、onic social security cards.To help improve the quality and efficiency of railway passenger transportation,the Bank expanded the application of offline scan-to-ride services for Railway e-Cards.As at 30 June 2023,this service had been successfully rolled out to 80 railway lines,covering key regions s
268、uch as the Beijing-Tianjin-Hebei region,Yangtze River Delta and Guangdong-Hong Kong-Macao Greater Bay Area,facilitating over 20 million journeys.Responding to the national rural revitalisation strategy,the Bank promoted debit cards themed on rural revitalisation with a total number of 2.22 million d
269、ebit cards issued as at 30 June 2023.To meet the differentiated needs of various customer groups,the Bank introduced a series of digital cards targeting business travel,fashion,sports and other sectors,enhancing its capability to acquire and activate more customers through vertical markets.The Bank
270、adopted a new development pattern for scenario-based instalment business,focusing on large-amount automobile consumption and providing auto financial services for nearly 10 thousand auto dealers.At the same time,the Bank expanded its footprint in the field of new energy vehicle consumption instalmen
271、t business,achieving steady growth in auto instalment loans.Using mobile payment as a key driver of customer consumption,the Bank launched the“gifts for quick payment”campaign and collaborated with mainstream payment institutions to roll out card-binding and“discount upon purchase”marketing activiti
272、es.During peak consumption periods such as public holidays and e-commerce shopping festivals,it introduced exclusive“discount upon purchase”offers on e-commerce platforms to facilitate the recovery of consumption.Moreover,recognising the fundamental purpose of consumption,the Bank focused on consump
273、tion related to peoples livelihood by meeting customers real consumption needs through joint“discount upon purchase”programmes with large shopping malls,catering,tourism,transportation and petrol stations.As at 30 June 2023,the Bank had issued a total of 660.4291 million debit cards and 142.3786 mil
274、lion credit cards.In the first half of 2023,credit card transaction volume amounted to RMB690.228 billion and the total instalment volume of credit cards stood at RMB165.842 billion.Digital Transformation of Personal BankingThe Bank continued to advance the digital transformation of its personal ban
275、king business to support high-quality development.It enhanced its customer tagging system and upgraded data analysis tools to improve digitally-driven precision marketing.The Bank also promoted online and intelligent wealth management,added investor education and market insights to product pages,lau
276、nched fund screening tools such as fund metrics and popular sectors,established product evaluation models for funds and other products,and constructed a multi-dimensional product tagging system.It continued to improve the mobile banking customer experience by streamlining the registration and login
277、process and optimising cross-border remittance,security authentication and other basic functions.By upgrading the“Lucky Virtual Travel”simulation game,the Bank guided customers from light-touch gaming tasks to financial missions,enhancing customer engagement.In the first half of 2023,the volume of t
278、he Banks mobile banking transactions reached RMB31.72 trillion,up 38.27%compared with the same period of the prior year.The number of monthly active mobile banking customers stood at 81.71 million in June.34Financial Markets BusinessThe Bank closely tracked global financial market dynamics as well a
279、s the development direction of the real economy.It stepped up efforts to ensure prudent and compliant operations and continuously adjusted its business structure,thus achieving high-quality development in its financial markets business and consolidating its leading position in the sector.Securities
280、Investment BusinessRegarding RMB bond investment,the Bank strengthened its professional forecasting and analysis of macroeconomic and financial market trends and focused on achieving a balance between safety,liquidity and profitability,recording positive portfolio performance.It improved active port
281、folio management,dynamically optimised its investment structure and continued to enhance its capacity to serve the real economy.It supported Chinas major regional strategies and local economic development,promoted infrastructure construction and maintained its investment in local government bonds.Th
282、e Bank pushed forward the green transition and high-quality development of Chinas economy,steadily increasing investments in green bonds and retaining its position as a leading investor in green debt financing instruments.It actively implemented the nations rural revitalisation strategy by continuou
283、sly increasing bond investment in the field of rural revitalisation.Regarding foreign currency securities investment,the Bank seized market opportunities amid rising interest rates and strived to improve portfolio yields.It took active measures to mitigate the adverse impact of the inverted US treas
284、ury yield curve,continually optimised its investment structure in terms of products and currencies,and dynamically adjusted its portfolio structure in terms of duration.It also acted decisively to prevent risks,manage market risk and credit risk,and refine the risk structure of its investment portfo
285、lios.Trading BusinessThe Bank actively fulfilled its responsibilities as a core market-maker and enhanced its comprehensive customer service capabilities to support national strategies and systematically optimise its financial markets business.It sharpened its advantages in financial markets,outperf
286、orming the market in terms of volume of foreign currency exchange against RMB,providing 40 currency pairs available for exchange and leading the domestic market in terms of the total number of tradable foreign currencies.The Bank was recognised as“Best RMB Foreign Exchange Market Maker”,“Best Foreig
287、n Currency Pair Market Maker”and“Excellent Currency Trading Institution along the Belt and Road”in interbank foreign exchange market rankings.In addition,it maintained the leading position in market-making rankings for precious metals on the Shanghai Gold Exchange and Shanghai Futures Exchange.The B
288、anks derivatives business for new benchmark interest rates developed steadily,receiving the accolade of“Bond Market Leading Institution of the Year”from China Central Depository&Clearing Co.,Ltd.To serve the real economy,the Bank actively promoted the concept of FX risk neutrality and offered compre
289、hensive financial market trading solutions by using of financial market trading instruments to help enterprises enhance their exchange rate risk management.New service 35models for micro,small and medium-sized enterprises were launched to help them prevent FX risk in extreme circumstances,and inclus
290、ive finance hedging services were steadily improved in terms of quality and efficiency.Furthermore,the Bank provided high-quality market-making quotation services for green bonds,with the volume of green bond transactions rising year-on-year.Seizing opportunities arising from the two-way opening up
291、of financial markets,the Bank expanded its overseas institutional investor customer base and promoted quotation services for domestic bonds and derivatives,based on a multi-tier service system integrating trading,sales and research.It successfully launched cross-border“Swap Connect”business,maintain
292、ed consistent market leadership in cash bond trading with overseas institutions,and won the“Northbound Top Market Maker”award under Bond Connect.To effectively guard against risks,the Bank further improved its risk control and management capabilities in order to conduct more forward-looking,proactiv
293、e and professional analysis of financial markets.In response to market volatilities and risk events in the first half of 2023,it improved its risk screening,risk control system and risk management mechanisms,taking steps to respond to risks quickly and effectively and thus ensure smooth business ope
294、rations.Investment Banking BusinessThe Bank centered on diversified financing needs of customers,fully leveraged the advantages of its globalised operations and diversified business platform to offer clients comprehensive,professional and customised“onshore+offshore”and“financing+intelligence”integr
295、ated financial services plans.These plans included financial products and services such as bond underwriting and distribution,asset-backed securitisation(ABS)and professional financial advisory services,and so on.To support the development of Chinas multi-layered capital markets and facilitate direc
296、t financing for customers,the Bank underwrote bonds in the China interbank market of a total amount of RMB681.106 billion in the first half of the year.Its sales volume of National Association of Financial Market Institutional Investors(NAFMII)credit bonds continued to rank first among peers.The Ban
297、k actively promoted its asset-backed securitisation(ABS)underwriting business,maintaining a leading market share in the China interbank bond market.It also pushed forward its credit asset-backed securitisation business,issuing five NPL-based credit asset-backed securitisations with a total issuance
298、volume of RMB3.445 billion during the first half of the year.Furthermore,the Bank promoted the issuance of green bonds by both financial and non-financial institutions,underwriting a total volume of RMB229.040 billion of green bonds and ranking first in the China interbank market.It further sharpene
299、d its competitive advantages in cross-border underwriting business,maintaining the largest market share in both offshore China bond underwriting and Panda bond underwriting.As a result,the brand influence of“BOC Debt Capital Markets”was continuously enhanced.The Bank strived to strengthen its cooper
300、ation with the comprehensive operation companies,supported clients needs for mergers and acquisitions,equity financing,project financing,debt restructuring,asset divestitures,cross-border investment and financing,market analysis,policy interpretation,etc.,and optimised its professional financial adv
301、isory service system.36Asset Management BusinessThe Asset Management Business Committee of the Bank is responsible for the overall management and top-level design of the Groups asset management business,while the newly established Asset Management Department promotes the implementation and coordinat
302、ed development of the Groups asset management business strategy.During the first half of the year,the Bank captured market opportunities brought about by the nations new development stage,in particular continuous growth in personal wealth and the development of“third pillar”private pensions within t
303、he retirement system.To achieve this,it strengthened resource integration within the Group,promoted digital transformation,enriched its product lines,enhanced personnel training and bolstered risk penetration management with the goal of systematically advancing the high-quality development of its as
304、set management business and improving customer service efficiency and effectiveness.Actively responding to development trends in the international asset management market,the Bank facilitated the deepening of financial reforms and the two-way opening-up of the financial sector,push forwarded the con
305、struction of overseas asset management platforms,and built up the Bank of China Asset Management(Global)brand.Through the coordinated development of asset management institutions within the Group,it provided individual and institutional investors with a wide range of asset classes,diverse investment
306、 strategies and complete investment cycles across both domestic and foreign currency products.As at the end of June 2023,the Banks AUM stood at RMB3.02 trillion.Custody BusinessThe Bank continued to enhance its core operational competitiveness and promote the high-quality development of custody busi
307、ness.It deepened its involvement in pension insurance custody business,establishing seven new pension FOFs in the first half of 2023 and ranking first among Chinese peers.The Bank actively participated in the innovative development of mutual funds and successfully served as custodian for the first h
308、ybrid valuation method fund in the market as well as the largest state-owned enterprise reform-themed fund of the year.It responded positively to the transformation and development of the trust industry,achieving rapid growth in the scale of its asset servicing trust property custody business.In add
309、ition,the Bank developed innovative service capabilities and supported the optimisation of the Hong Kong Stock Connect trading calendar as well as the full implementation of registration-based IPO system reform.The Bank was recognised as“Best Private Fund Administrator”by The Asset in 2022,becoming
310、the first Chinese banking institution to receive this award.As at 30 June 2023,total assets of the Groups custody business reached RMB16.48 trillion.Digital Transformation of Financial MarketsThe Bank continuously enhanced its online service capabilities to offer more convenient customer transaction
311、s and proactively advanced key technology projects to accelerate the digital transformation of its financial markets business.In addition,it made steady progress in building its quantitative trading platform,improved its quantitative trading infrastructure,enriched its automated trading strategies a
312、nd strengthened trading capacity.37Village BankBOC Fullerton Community Bank actively implemented the development concept of“focusing on county area development,supporting farmers and small-sized enterprises,and growing together with communities”.It remained committed to providing modern financial se
313、rvices to county-level micro and small-sized enterprises,individual merchants,wage earners and farmers,developing inclusive finance,and facilitating rural revitalisation.As at 30 June 2023,BOC Fullerton Community Bank controlled 134 village banks with 189 sub-branches in 22 provinces(including munic
314、ipalities directly under the Central Government),of which 90 banks with legal person status were located in the mid-west region.It continually improved its product and service system to further,steadily expanding its business scale.As at 30 June 2023,the balances of total deposits and loans of these
315、 banks stood at RMB71.778 billion and RMB77.950 billion respectively.The NPL ratio was 2.11%,and the ratio of allowance for loan impairment losses to NPLs was 191.15%.During the first half of 2023,BOC Fullerton Community Bank achieved a profit of RMB158 million.38Globalised OperationAs the most glob
316、alised Chinese bank,BOC continued to advance its globalisation agenda and enhance its global services.It actively supported Chinas new development pattern and high-standard opening up,boosting the domestic economy and facilitating the positive interplay between domestic and international economic fl
317、ows.The Bank persistently explored development opportunities to promote the steady and orderly development of all its businesses and further increase its market influence.The Bank helped foster the beneficial interactions between domestic and international markets and resources,promoted trade and in
318、vestment cooperation,and improved its ability to create value by aligning its own growth with the local economic and social development of the countries and regions in which it operates.In the course of developing its globalised operations,it strengthened its risk management,compliance and safety ca
319、pabilities,thus ensuring business continuity.In addition,the Bank has been an active contributor to bilateral and multilateral international financial organisations in the formulation of international standards and rules,and used its presence at high-level international conferences to increase China
320、s financial influence.As at 30 June 2023,the Banks overseas commercial banking business realised customer deposits and loans of USD544.308 billion and USD442.337 billion respectively,an increase of 4.78%and 2.65%compared with the prior year-end.In the first half of 2023,the Banks overseas commercial
321、 banking business achieved a profit before income tax of USD4.536 billion,an increase of 23.09%compared with the same period of the prior year,contributing to 20.22%of the Groups total profit before income tax.To meet the financial services needs of its global clients,the Bank continued to optimise
322、its global network.As at 30 June 2023,the Bank had established 532 overseas institutions covering 63 countries and regions outside the Chinese Mainland,including 43 BRI partner countries.In June 2023,the Bank of China Representative Office in Papua New Guinea was officially open for business.The Ban
323、k continued to enhance the regionalised management and integrated development of its overseas operations,making steady progress in establishing overseas regional headquarters and implementing mechanisms for improved synergy between institutions in the region.BOCHK strengthened management of its Sout
324、heast Asian branches and subsidiaries.Bank of China(Europe)S.A.also made progress in regionalised management and integrated operations;and the launch of the BOC EU Shared Service Centre further improved the quality and efficiency of financial services in the region.In addition,the mechanism for regi
325、onal synergistic development has been carried out in Latin America,South Asia,and the South Pacific,improving synergy between institutions and enhancing competitiveness in these regions.The Bank continued to categorise its branches and subsidiaries outside the Chinese mainland based on their distinc
326、tive local conditions to invigorate their development.The Bank also reviewed and revised its market-by-market differential development strategies to further strengthen the foundation of safe development,enhance the synergistic services of the Group.In this way,the Bank enhanced its capabilities to s
327、upport the global development of its customers,and provide high-quality financial services for their“Bringing In”and“Going Global”efforts.39Corporate BankingThe Bank gave full play to its advantages in globalised and integrated operations,kept a close eye on changes in global markets,strengthened it
328、s analysis of market trends and risk management,and took effective measures in line with local conditions to ensure the stable and sustainable development of its overseas corporate banking business,and facilitate the establishment of a“dual circulation”new development pattern,thus making positive co
329、ntributions to both Chinas economic development and the global economic recovery.The Bank maximised the advantages of its global institution network and fostered comprehensive cooperation with various types of financial institutions in areas such as clearing,settlement,lending,investment,custody,tre
330、asury operations and comprehensive capital market services.As a result,it further expanded its customer base and enhanced its international influence.Responding in a more agile and forward-looking manner to market fluctuations,the Bank provided market advice to overseas institutional customers and p
331、romoted the investment value of RMB to medium and long-term investors around the world,resulting in steady growth in its overseas institutional investor customer base.Moreover,the Bank made full use of its international partnership network,drew on advanced global expertise and deepened peer communic
332、ation and cooperation mechanisms to continually strengthen its participation in ESG-related fields worldwide.The Bank pushed forward the establishment of an integrated service mechanism,promoting business linkage and expansion between domestic and overseas corporate banking.In addition,focusing on b
333、ilateral trade and customers,the Bank explored business opportunities in bilateral trade and investment and prioritised support to“Bringing In”and“Going Global”customers within its global development.It achieved steady growth in overseas international settlement and trade finance business,further improved its global strategic synergies and enhanced the quality and efficiency of its customer servic