Xiamen International Bank Co., Ltd. 2018 Annual Report 厦门国际银行股份有限公司 2018 年年度报告 Important Notice The Bank's Board of Directors, Board of Supervisors, directors, supervisors, and senior management hereby declare that this report does not contain any false records, misleading statements or material omissions, and they assume joint and individual responsibilities on the authenticity, accuracy and completeness of the information herein. The financial figures and indicators contained in this annual report compiled in accordance with China Accounting Standards, unless otherwise specified, are consolidated figures calculated based on domestic and overseas data in terms of RMB. Official auditor of the Bank, KPMG Hua Zhen LLP (special general partnership), conducted an audit on the 2018 Financial Statements of XIB compiled in accordance with China Accounting Standards, and issued a standard unqualified audit report. The Bank’s Chairman Mr. Weng Ruotong, Head of Accounting Affairs Ms. Tsoi Lai Ha, and Head of Accounting Department Mr. Zheng Bingzhang, hereby ensure the authenticity, accuracy and completeness of the financial report contained in this annual report. Notes on Major Risks: No major risks that can be predicted have been found by the Bank. During its operation, the key risks faced by the Bank include credit risks, market risks, operation risks, liquidity risks, compliance risks, country risks, information technology risks, and reputation risks, etc. The Bank has taken measures to effectively manage and control the various kinds of operational risks. For relevant information, please refer to Chapter 2, Discussion and Analysis of Business Conditions. Forward-looking Risk Statement: This Report involves several forward-looking statements about the financial position, operation performance and business development of the Bank, such as “will”, “may”, “strive”, “endeavor”, “plan to”, “goal” and other similar words used herein. Such statements are based on current plans, estimates and forecasts and they do not constitute substantial commitment of the Bank. Please maintain adequate awareness of risk and understand differences among plans, forecasts and commitments. 1 Xiamen International Bank Co., Ltd. Annual Report 2018 Table of Contents Important Notice ................................................................................................................ 1 Definitions ......................................................................................................................... 3 Chairman’s Statement ....................................................................................................... 4 President’s Report ............................................................................................................. 6 Chapter I Company Profile and Major Financial Indicators ............................................. 9 Chapter II Discussion and Analysis of Business Conditions ............. 错误!未定义书签。 Chapter III Changes to Capital Stock and Shareholders ................................................. 64 Chapter IV Overview of Directors, Supervisors, Senior Officers and Employees ......... 68 Chapter V Corporate Governance ................................................................................... 82 Chapter VI Major Events ............................................................................................... 111 Chapter VII Financial Report ........................................................................................ 114 Chapter VIII List of Documents for Reference ............................................................. 114 2 厦门国际银行股份有限公司 2018 年年度报告 Definitions In this annual report, unless the context otherwise specified, the following terms shall bear the respective meanings as following: Term Definitions The Bank, the Company, Xiamen Xiamen International Bank Co., Ltd. International Bank, XIB Articles of Association, these Articles The Articles of Association of Xiamen of Association, the Company’s International Bank Co., Ltd. Articles of Association CBRC China Banking Regulatory Commission CBIRC China Banking and Insurance Regulatory Commission CBIRC Xiamen Xiamen Office of China Banking and Insurance Regulatory Commission Yuan RMB yuan Institutions in Chinese Mainland All offices that XIB has established in Chinese Mainland, including the head office of Xiamen International Bank Co., Ltd. Overseas Institutions Luso International Banking Ltd. (LIB), Chiyu Banking Corporation Limited (CYB), and subsidiaries included in the Bank’s consolidated financial statements including Xiamen International Investment Co., Ltd. Luso International Bank, LIB Luso International Banking Ltd. Chiyu Bank, CYB Chiyu Banking Corporation Ltd. The Fourth Five-Year Plan The Fourth Five-Year Plan (2016–2020) of Xiamen International Bank Co., Ltd. The reporting period January 1, 2018 – December 31, 2018 3 Chairman’s Statement In 2018, facing complex and volatile economic and financial situations at home and abroad, XIB continued to maintain a robust and positive development trend under the strong leadership of the Board of Directors of the Bank. As of the end of 2018, the Bank’s total assets registered RMB 806.1 billion, representing a 13.14% growth compared with the end of previous year; annual after-tax profit amounted to RMB 5.824 billion, an increase by 7.86% from the end of previous year; ordinary customer deposits reached RMB 537.2 billion, representing a 14.13% year-on-year growth; non-performing loan ratio across the Bank was 0.73%. Overall asset quality of the Bank was maintained at a good level. Over the past year, the Bank has actively implemented policies of state and regulatory authority, returned to the origin of serving the real economy and took the initiative to develop small and micro-sized enterprises, retail business and other inclusive finance businesses. Adhering to the high-quality development path, its businesses showed positive development trend with quality, benefits and efficiency advancing together. In accordance with the concept of “developing by the people and benefits for the people”, the Bank was committed to social undertakings for public interest, actively fulfilled its social responsibilities and meticulously created a corporate brand image featured with “promising development and strong sense of responsibility”. Meanwhile, the Bank actively responded to the national strategies such as the “Belt and Road Initiative”, “Guangdong-Hong Kong-Macao Greater Bay Area” and expanding financial reform and opening up. Chiyu Bank, one of its affiliated company, successfully established its Shenzhen Branch, with total assets exceeding HKD 100 billion; Luso International Bank, also one of its affiliated company, successfully established two sub-branches off Macao – Foshan Sub-branch and Dongguan Sub-branch, with the interbank ranking among the top 3 banks in Macao in terms of key indicators; and Luso International Bank was listed as a systemically important bank in Macao. For the above achievements, on behalf of the Board of Directors, I would like to extend my sincerest gratitude to those who have always cared about and supported us, including all levels of governments, regulators, customers, shareholders and the 4 厦门国际银行股份有限公司 2018 年年度报告 community. I also would like to express my heartful thanks to all the employees of the Bank, for all their hard work! In 2019, guided by the spirits of conferences including the 19th National Congress of the Communist Party of China (CPC) and National Financial Work Conference, XIB will continue to adhere to the strategic mindset of “operating with integrity and business acumen, navigating risks, and pursuing lean management”, judge in depth the challenges and opportunities in the new situation to accelerate transformation and development. Under the premise of quality assurance, the Bank will continue to support the real economy and the development of medium, small and micro-sized enterprises, so that it can push its business development to a new height. 5 President’s Report In 2018, faced against complex and volatile economic and financial situations at home and abroad, XIB thoroughly studied and implemented the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and the spirits of the 19th National Congress of the Communist Party of China (CPC) and the Third Plenary Session of the 19th CPC Central Committee. In accordance with the decisions and deployment of the Board of Directors centering on the annual work policy of “consolidating and upgrading, and quality and benefit”1, the Bank has deepened transformation, transition and upgrading, gave play to its advantage in characteristic operation and management, actively promoted its strategic layout while adhering to the high quality development path to achieve stable development in all businesses. As of the end of 2018, the Bank’s total asset increased by 13.14% compared with the end of the previous year; balance of deposits and loans grew by 14.13% and 26.27% respectively from the end of the previous year; full-year after-tax profits increased by 7.86% from the end of the previous year; year-end non-performing loan ratio was 0.73%. The Bank’s asset quality was maintained at a stable and good level, realizing balanced development of quality, benefits and efficiency. In 2018, XIB ranked the 165th in terms of total assets and the 204th in terms of tier I capital among the World’s Top 1000 Banks in 2018 as published by the British magazine The Banker.