Delivering Excellence Serving Society Ordinary H-Share Stock Code: 3988 Ordinary H-Share 4601 Share Stock Code: Offshore Preference
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Ordinary H-Share Stock Code: 3988 Offshore Preference Share Stock Code: 4601 1 Fuxingmen Nei Dajie, Beijing, China, 100818 Tel: (86) 10-6659 6688 Fax: (86) 10-6601 6871 Customer Service and Complaint Hotline: (86) Area Code-95566 http://www.boc.cn Annual Report 2014 Serving Society Delivering Excellence Stock Code: 3988 / 4601 2014 Annual Report STOCKHOLM GLASGOW HAMBURG MOSCOW DUBLIN MANCHESTER BERLIN BIRMINGHAM ROTTERDAM WARSAW LONDON DUSSELDORF CALGARY AKTOBE BRUSSELS PARIS FRANKFURT KHABAROVSK VANCOUVER MUNICH ALMATY ULAANBAATAR LYON BUDAPEST MILAN MONTREAL LUXEMBOURG VLADIVOSTOK TORONTO ROME ISTANBUL CHICAGO NEW YORK LISBON KOBE SEOUL DAEGU TOKYO ANSAN LOS ANGELES YOKOHAMA OSAKA NAGOYA BAHRAIN DUBAI TAIPEI ABU DHABI MACAU HONG KONG GRAND CAYMAN BANGKOK MANILA PHNOM PENH HO CHI MINH CITY COLON PENANG PANAMA KLANG KUALA LUMPUR JOHOR BAHRU MEDAN KUCHING NAIROBI PUCHONG SINGAPORE MUAR LUANDA JAKARTA SURABAYA KITWE LUSAKA RIO DE JANEIRO SAO PAULO JOHANNESBURG BRISBANE PERTH SYDNEY AUCKLAND MELBOURNE Bank of China Global Network Bank of China is the most internationalised bank in China. After establishing the London Agency in 1929, which was the first overseas institution of Chinese financial institutions, the Bank gradually expanded its overseas network to major global financial centres including Tokyo, Singapore and New York. At present, the Bank provides a comprehensive range of financial services to customers across the Chinese mainland as well as 41 countries and regions. STOCKHOLMSTOCKHOLM GLASGOWGLASGOW HAMBURGHAMBURG MOSCOWMOSCOW DUBLINDUBLIN MANCHESTERMANCHESTERBERLINBERLIN BIRMINGHAMBIRMINGHAMROTTERDAMROTTERDAM WARSAWWARSAW LONDONLONDON DUSSELDORFDUSSELDORF CALGARYCALGARY AKTOBEAKTOBE BRUSSELSBRUSSELSPARISPARIS FRANKFURTFRANKFURT KHABAROVSKKHABAROVSK VANCOUVERVANCOUVER MUNICHMUNICH ALMATYALMATY ULAANBAATARULAANBAATAR LYONLYON BUDAPESTBUDAPEST MILANMILAN MONTREALMONTREAL LUXEMBOURGLUXEMBOURG VLADIVOSTOKVLADIVOSTOK TORONTOTORONTO ROMEROME ISTANBULISTANBUL CHICAGOCHICAGO NEWNEW YORK YORK LISBONLISBON KOBEKOBE SEOULSEOULDAEGUDAEGU TOKYOTOKYO ANSANANSAN LOSLOS ANGELES ANGELES YOKOHAMAYOKOHAMA OSAKAOSAKANAGOYANAGOYA BAHRAINBAHRAIN DUBAIDUBAI TAIPEITAIPEI ABUABU DHABI DHABI MACAUMACAU HONGHONG KONG KONG GRANDGRAND CAYMAN CAYMAN BANGKOKBANGKOK MANILAMANILA PHNOMPHNOM PENH PENH HO HOCHI CHI MINH MINH CITY CITY COLOCOLON N PENANGPENANG PANAMAPANAMA KLANGKLANG KUALAKUALA LUMPUR LUMPUR JOHORJOHOR BAHRU BAHRU MEDANMEDAN KUCHINGKUCHING NAIROBINAIROBI PUCHONGPUCHONG SINGAPORESINGAPORE MUARMUAR LUANDALUANDA JAKARTAJAKARTA SURABAYASURABAYA KITWEKITWE LUSAKALUSAKA RIO RIODE JANEIRODE JANEIRO SAOSAO PAULO PAULO JOHANNESBURGJOHANNESBURG BRISBANEBRISBANE PERTHPERTH SYDNEYSYDNEY AUCKLANDAUCKLAND MELBOURNEMELBOURNE Introduction Bank of China was formally established in February 1912 following the approval of Dr. Sun Yat-sen. From 1912 to 1949, the Bank served consecutively as the country’s central bank, international exchange bank and specialised international trade bank. Fulfilling its commitment to serving the public and developing China’s financial services sector, the Bank rose to a leading position in the Chinese financial industry and developed a good standing in the international financial community, despite many hardships and setbacks. After 1949, drawing on its long history as the state-designated specialised foreign exchange and trade bank, the Bank became responsible for managing China’s foreign exchange operations and provided vital support to the nation’s foreign trade development and economic infrastructure by its offering of international trade settlement, overseas fund transfer and other non-trade foreign exchange services. During China’s reform and opening up period, the Bank seized the historic opportunity presented by the government’s strategy of capitalising on foreign funds and advanced technologies to boost economic development, and became the country’s key foreign financing channel by building up its competitive advantages in foreign exchange business. In 1994, the Bank was transformed into a wholly state-owned commercial bank. In August 2004, Bank of China Limited was incorporated. The Bank was listed on the Hong Kong Stock Exchange and the Shanghai Stock Exchange in June and July 2006 respectively, becoming the first Chinese commercial bank to launch an A-Share and H-Share initial public offering and achieve a dual listing in both markets. In 2014, Bank of China was designated again as a Global Systemically Important Bank, becoming the sole financial institution from emerging economies to be designated as a Global Systemically Important Bank for four consecutive years. As China’s most internationalised and diversified bank, Bank of China provides a comprehensive range of financial services to customers across the Chinese mainland as well as 41 countries and regions. The Bank’s core business is commercial banking, including corporate banking, personal banking and financial markets services. BOC International Holdings Limited, a wholly owned subsidiary, is the Bank’s investment banking arm. Bank of China Group Insurance Company Limited and Bank of China Insurance Company Limited, both wholly owned subsidiaries, run the Bank’s insurance business. Bank of China Group Investment Limited, a wholly owned subsidiary, undertakes the Bank’s direct investment and investment management business. Bank of China Investment Management Co., Ltd., a controlled subsidiary, operates the Bank’s fund management business. BOC Aviation Pte. Ltd., a wholly owned subsidiary, is in charge of the Bank’s aircraft leasing business. Bank of China has upheld the spirit of “pursuing excellence” throughout its hundred-year history. With adoration of the nation in its soul, integrity as its backbone, reform and innovation as its path forward and “people first” as its guiding principle, the Bank has built up an excellent brand image that is widely recognised within the industry and by its customers. Faced with new historic opportunities, the Bank will meet its social responsibilities, strive for excellence, and make further contributions to achieving the China Dream and the great rejuvenation of the Chinese nation. 1 2014 Annual Report Development Strategy Core Values Pursuing excellence Integrity Performance Responsibility Innovation Harmony Strategic Goal Serving Society, Delivering Excellence Overall Requirements of the Development Strategy To build Bank of China into an excellent bank driven by the pursuit of noble values, a bank that shoulders significant responsibility for the nation’s revival, a bank that possesses competitive edges in the globalisation process, a bank that leads lifestyle changes in technological innovations, a bank that earns customer loyalty in market competition and a bank that meets the expectations of shareholders, employees and society in the course of its sustained development. 2014 Annual Report 2 Contents 4 Definitions 88 Directors, Supervisors and 5 Important Notice Senior Management Members 6 Honours and Awards 104 Corporate Governance 7 Financial Highlights 120 Report of the Board of Directors 10 Corporate Information 126 Report of the Board of Supervisors 11 Message from the Chairman 129 Significant Events 15 Message from the President 132 Independent Auditor’s Report 19 Message from the Chairman of 134 Consolidated Financial Statements the Board of Supervisors 321 Unaudited Supplementary Financial 21 Management Discussion and Analysis Information 21 — Financial Review 324 Supplementary Information — 37 — Business Review Differences Between CAS and IFRS 60 — Risk Management Consolidated Financial Statements 71 — Organisational Management, 325 Unaudited Supplementary Information — Human Resources Development Global Systemically Importance and Management Assessment Indicators of 73 — Outlook Commercial Banks 75 Corporate Social Responsibilities 326 Reference for Shareholders 78 Changes in Share Capital and 329 Organisational Chart Shareholdings of Shareholders 331 List of Major Branches and Subsidiaries 3 2014 Annual Report Definitions In this report, unless the context otherwise requires, the following terms shall have the meaning set out below: The Bank/the Group Bank of China Limited or its predecessors and, except where the context otherwise requires, all of the subsidiaries of Bank of China Limited A Share Domestic investment share(s) in the ordinary share capital of the Bank, with a nominal value of RMB1.00 each, which are listed on SSE (Stock Code: 601988) Articles of Association The performing Articles of Association of the Bank Basis Point 0.01 of a percentage point BOC Aviation BOC Aviation Pte. Ltd. BOC Insurance Bank of China Insurance Company Limited BOCG Insurance Bank of China Group Insurance Company Limited BOCG Investment Bank of China Group Investment Limited BOCG Life BOC Group Life Assurance Co., Ltd. BOCHK Bank of China (Hong Kong) Limited, an authorised financial institution incorporated under the laws of Hong Kong and a wholly-owned subsidiary of BOCHK (Holdings) BOCHK (Holdings) BOC Hong Kong (Holdings) Limited, a company incorporated under the laws of Hong Kong and the ordinary shares of which are listed on the Hong Kong Stock Exchange BOCI BOC International Holdings Limited BOCIM Bank of China Investment Management Co., Ltd. BOCI China BOC International (China) Limited CBRC China Banking Regulatory Commission Central and Southern China The area including, for the purpose of this report, the branches of Henan, Hubei, Hunan, Guangdong, Shenzhen, Guangxi and Hainan Company Law The Company