BANK of SUZHOU CO., LTD Annual Report 2012

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BANK OF SUZHOU CO., LTD

Annual Report 2012

CONTENTS

IMPORTANT NOTICE……………………………………………………..…3

PRESIDENT’S ADDRESS…………………………………………………….4

ANNUAL AWARDS RECEIVED……………………………………………..5

CHAPTER І COMPANY INFORMATION………………………………….6

CHAPTER II FINANCIAL SUMMARY……………………………………..7

CHAPTER III EQUITY STRUCTURE AND SHAREHOLDERS………..12

CHAPTER IV DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT

& EMPLOYEES………………………………………………………………17

CHAPTER V COMPANY MANAGEMENT……………………………….32

CHAPTER VI GENERAL MEETING OF SHAREHOLDS…………...... 59

CHAPTER VII IMPORTANT ISSUES……………………………………..61

CHAPTER VIII CORPORATE SOCIAL RESPONSIBILITY……………63

CHAPTER IX FINANCIAL REPORT (SEETHE APPENDIX)…………..65

Important Notice

The Board of Directors, the Board of Supervisors, Directors, Supervisors and Senior Management members of Bank of Suzhou Co., Ltd undertake that the information in this report contains no false record, misleading statement or material omission, and assume individual and joint and several liabilities to the authenticity, accuracy and completeness of the information in this report.

This Annual Report was passed through voting by correspondence in the 27th conference of the 1st session of board of directors on Apr. 28, 2013.

The terms of “this Company”, “this bank” and “Bank of Suzhou” herein shall refer to Bank of Suzhou Co., Ltd.; “this Group” shall refer to Bank of Suzhou Co., Ltd. and its affiliated companies.

The financial data and indices herein are prepared in accordance with Chinese Accounting Standards, and expressed in RMB currency.

The auditor of this Company, Ernst & Young has conducted an audit of the financial report 2012 prepared in accordance with Chinese Accounting Standards, and issued a standard audit report with unreserved assent.

The Board of Directors of Bank of Suzhou Co., Ltd.

Apr. 28, 2013

The Board Chairman Wang Lanfeng, President Xu Ting, Vice-President Gu Ping in charge of accounting guarantee that the contents of financial report are true, accurate and complete.

PRESIDENT’S ADDRESS

2012 is a year when China encountered serious challenges in economy as well as deep-going transforms in finance. In 2013, by keeping with the tide of the times and with the enterprising and stable-yet-progressive spirit, Bank of Suzhou exploits the advantages of being a medium-and-small bank and characteristic bank, and following the concept of “small uppermost and people orientated”, commits to carrying out the tenet of “serving the medium-and-small enterprises, the public and the regional economy”, moving towards the development road of modern commercial banks in a vibrant manner.

In the year 2012 just closed, thanks to the great concerns of municipal committee and government, the firm support from our shareholders, and the strenuous efforts of all our staff, Bank of Suzhou received encouraging results, and the market status and influence got remarkably improved. As to the end of 2012, the overall assets of this bank totaled up to 128.42 billion Yuan, the total deposit balance in RMB and foreign currency reached 70.662 billion Yuan, the loan balance in RMB and foreign currency reached 42.999 billion Yuan; the total profit came up to 1.763 billion Yuan, hit another new high; while realizing the profit growth, this bank maintains excellent key supervision indices and stable assets quality, and has the provision coverage ratio, capital adequacy ratio and core capital adequacy ratio kept at 300.73%, 17.53% and 16.77% respectively.

In the future, Bank of Suzhou will centers on the people's livelihood, pursues new opportunities of business development, and takes advantage of the sustaining financial innovation, high-quality customer service, moderate operation style and excellent business achievements, in order to become a leading enterprise of Suzhou in regional financial development with great core competitiveness and individual operation characteristics, so as to create more value and higher return for the investors, society and employees.

President: Wang Lanfeng

Bank of Suzhou Co., Ltd.

April 28, 2013

Annual Awards Received

2012 is a harvest year for this Company in brand equity, social evaluation and reputation. By virtue of the moderate operation performance, good corporate culture and strong management capability, this Company received ten significant awards, including:

 National Excellent Settlement Member on Inter-bank Bond Market in 2012;

 Top 100 Banks in RMB Market Transactions in 2012;

 Preferred Financial Service Bank for Medium and Small Enterprises for Suzhou Merchants in 2012;

 Advanced Unit for Duty-related Crimes Prevention in Suzhou 2010-2012;

 Class-A Bank in Foreign Exchange Control Policy Enforcement in Suzhou 2012;

 Advanced Unit in Foreign Exchange Administration of Direct Investments in Suzhou 2012;

 Municipal Advanced Unit in Financial IC Card Application 2012;

 Municipal Advanced Unit in Cash Management 2012;

 Advanced Group Member of Suzhou Financial Institute;

 Advanced Group of SIP Financial Safety.

Chapter I Company Information

I. Legal Chinese name of the Company: 苏州银行股份有限公司（“苏州银行” for short） Legal English name of the Company: BANK OF SUZHOU CO., LTD（ “BSZ” for short）

II. Legal representative: Wang Lanfeng

III. BOD secretary: Jiang Li

IV. Contact address: 728 Zhongyuan Road, Suzhou City, Jiangsu Province Postal code: 215028 Tel: 86-512-69868130 Fax: 86-512-69868124 Email: [email protected]

V. Registered address: 143 N. Dongwu Road, Suzhou City, Jiangsu Province Postal code: 215128 Website: www.suzhoubank.com Email: [email protected]

VI. Information disclosure website designated by the Company: www.suzhoubank.com Annual report deposit place: BOD office of the Company

VII. Counselor in Chinese Mainland: Jiangsu Wuzhou Xinyou Lawyer’s Office

VIII. Chinese CPA office: Ernst & Young Shanghai Office (special general partnership) Office address: 50F, Shanghai World Financial Center, 100 Century Avenue, Pudong New Area, Shanghai

IX. Date of initial registration: Dec. 24, 2004 Address of initial registration: 143 N. Dongwu Road, Suzhou City, Jiangsu Province

X. Corporation Business License No.: 320500000039152

XI. Tax Registration Certificate No.: SZGSD Zi 320500768299855

SDS Zi 320500768299855

Chapter II Financial Summary

I. Major Financial Data and Indices

1. Consolidated basis

During the report period 2012 2011 2012 vs 2011 Operating achievements (in million RMB Yuan) Growth rate (%) Net interest income 3,192.45 2,348.85 35.92 Net non-interest income 262.38 78.73 233.25 Operating income 3,454.83 2,427.58 42.32 Business and management fee 1,232.16 805.06 53.05 Asset impairment loss 293.82 80.55 264.75 Operating profit 1,721.17 1,418.10 21.37 Total profits 1,763.29 1,429.30 23.37 Net profit 1,383.33 1,132.62 22.14 Net profit attributed to the shareholders of 1,356.46 1,119.28 21.19 parent company Net profit after deduction of non-recurring 1,351.74 1,124.22 20.24 profit and loss Net profit attributed to the shareholders of parent company after deduction of 1,359.40 1,115.09 21.91 non-recurring profit and loss Net cash flow from operating activities 20,339.50 10,132.19 100.74 Per share (RMB Yuan/ share) Growth rate (%) Earnings per share 0.46 0.38 22.14 Earnings per share after deduction of 0.45 0.37 20.24 non-recurring profit and loss Net cash flow from operating activities per 6.78 3.38 100.74 share Profit ability indices (%) Changes in percentage Average rate of return on total assets 1.31 1.63 -0.33 Weighted average rate of return on 9.63 8.44 1.19 common stockholders' equity Weighted average rate of return on common stockholders' equity after 9.56 8.38 1.18 deduction of non-recurring profit and loss Cost-to-income ratio 35.98 33.21 2.77 Proportion of handling charge and 5.07 1.92 3.15 commission income in operating income Net profit margin 2.56 2.89 -0.33 Net interest margin 3.09 3.46 -0.37 At the end of report period 2012 2011 2012 vs 2011 Scale indices (in million RMB Yuan) Growth rate (%) Total assets 128,420.26 83,474.43 53.84

Total loans and advances 42,999.30 32,305.72 33.10 Total debts 113,509.69 69,655.04 62.96 Total money deposits received 70,662.18 52,906.49 33.56 Equities attributed to the shareholders of 14,759.77 13,692.49 7.79 parent company Net assets per share attributed to the shareholders of parent company (RMB 4.92 4.56 7.79 Yuan/ share) Assets quality indices (%) Changes in percentage Non-performing loan ratio 0.85 N/A N/A Provision coverage 300.73 N/A N/A Loan provision coverage 2.57 2.57 0.00 Capital adequacy indices (%) Capital adequacy ratio 17.53% N/A N/A Core capital adequacy ratio 16.77% N/A N/A Total equities to total assets ratio 11.61 16.56 -4.95 Notes: 1. Average rate of return on total assets =Net profit /Average balance of opening and closing total assets. 2. Weighted average rate of return on common stockholders' equity = Net profit / Weighted average balance of owner’s equities 3. Cost-to-income ratio = (Business & management fee + other business cost) /Operating income. 4. Net profit margin=Average rate of return on interest-bearing assets – Average cost rate of interest-bearing debts. 5. Net interest margin= Net interest income / Average balance of interest-bearing assets. 6. Non-performing loan ratio = Non-performing loan balance/ Total loans and advances. 7. Provision coverage = Loans impairment reserve / Non-performing loan balance. 8. Loan provision coverage = Loans impairment reserve / Total loans and advances. 9. Capital adequacy ratio is unaudited. 2. Parent company’s basis

During the report period 2012 2011 2012 vs 2011 Operating achievements (in million RMB Yuan) Growth rate (%) Net interest income 3,024.55 2,231.46 35.54 Net non-interest income 267.45 78.72 239.76 Operating income 3,292.01 2,310.18 42.50 Business and management fee 1,166.39 757.30 54.02 Asset impairment loss 250.82 59.10 324.37 Operating profit 1,674.19 1,374.14 21.84 Total profits 1,670.27 1,379.73 21.06 Net profit 1,315.00 1,095.90 19.99 Net profit after deduction of 1,317.95 1,091.71 20.72 non-recurring profit and loss Net cash flow from operating activities 21,178.68 11,474.80 84.57 Per share (RMB Yuan/ share) Growth rate (%) Earnings per share 0.44 0.37 19.99 Net cash flow from operating activities 7.06 3.82 84.57 per share Profit ability indices (%) Changes in percentage Average rate of return on total assets 1.26 1.61 -0.35 Weighted average rate of return on 9.28 8.24 1.03 common stockholders' equity

Cost-to-income ratio 35.77 32.83 2.93 Proportion of handling charge and 5.29 1.98 3.31 commission income in operating income Net profit margin 2.44 2.76 -0.32 Net interest margin 2.98 3.35 -0.37 At the end of report period 2012 2011 2012 vs 2011 Scale indices (in million RMB Yuan) Growth rate (%) Total assets 126,316.78 81,865.34 54.30 Total loans and advances 40,370.48 30,636.95 31.77 Total debts 111,626.63 68,201.01 63.67 Total money deposits received 67,803.50 50,545.02 34.14 Assets quality indices (%) Changes in percentage Non-performing loan ratio 0.87 N/A N/A Provision coverage 292.34 N/A N/A Loan provision coverage 2.55 2.60 -0.05 Capital adequacy indices (%) Capital adequacy ratio 17.64 N/A N/A Core capital adequacy ratio 17.03 N/A N/A Total equities to total assets ratio 11.63 16.69 -5.06 Notes: 1. Average rate of return on total assets =Net profit /Average balance of opening and closing total assets. 2. Weighted average rate of return on common stockholders' equity = Net profit / Weighted average balance of owner’s equities 3. Cost-to-income ratio = (Business& management fee + other business cost) /Operating income. 4. Net profit margin=Average rate of return on interest-bearing assets – Average cost rate of interest-bearing debts. 5. Net interest margin= Net interest income / Average balance of interest-bearing assets. 6. Non-performing loan ratio = Non-performing loan balance/ Total loans and advances. 7. Provision coverage = Loans impairment reserve / Non-performing loan balance. 8. Loan provision coverage = Loans impairment reserve / Total loans and advances. 9. Capital adequacy ratio is unaudited. II. Supplementary Financial Data and Indices 1. Consolidated basis (Currency: million RMB Yuan) Non-recurring profit and loss items 2012 2011 Non-operating income 52.61 13.31 Incl.: Assets disposal gains 0.00 0.00 Government subsidy income 52.15 10.16 Others 0.46 3.14 Non-operating expenditure 10.49 2.12 Incl.: Donation and sponsorship fee 9.63 0.22 Assets disposal loss 0.00 0.01 Others 0.86 1.88 Net non-operating income and expenditure 42.12 11.20 Less: Tax effect of non-recurring profit and loss items 10.53 2.80 Net after-tax effect of non-recurring profit and loss items 31.59 8.40 Incl.: Non-recurring profit and loss affecting the net profit of -2.94 4.19 parent company Non-recurring profit and loss affecting the net profit of 34.53 4.20 minority shareholders 9

2. Parent company’s basis

(Currency: million RMB Yuan) Non-recurring profit and loss items 2012 2011 Non-operating income 1.92 7.60 Incl.: Assets disposal gains 0.00 0.00 Government subsidy income 1.49 5.66 Others 0.43 1.93 Non-operating expenditure 5.84 2.01 Incl.: Donation and sponsorship fee 5.33 0.20 Assets disposal loss 0.00 0.01 Others 0.51 1.80 Net non-operating income and expenditure -3.92 5.59 Less: Tax effect of non-recurring profit and loss items -0.98 1.40 Net after-tax effect of non-recurring profit and loss items -2.94 4.19

III. Capital Adequacy Ratio Analysis

The Administrative Measures for the Capital of Commercial Banks (for Trial Implementation) (Hereinafter referred to as “New Measures”) was put in force since Jan. 1, 2013. As of the end of December 2012, the capital adequacy ratios of the Group and the Company at all levels have met the regulatory requirements during the transition period as stipulated in the New Measures.

1. Capital structure The net core Tier 1 capital and net Tier 1 capital of our bank by the end of 2012 are 14,499.64 (million RMB) respectively, and the net total capital amounts to 15,234.64 (million RMB).

The core Tier 1 capital amounts to 14,698.23 (million RMB), regulatory capital deductions for core Tier 1 capital 198.59 (million RMB), Tier 2 capital 7,345.00 (million RMB), other Tier 1 capital, regulatory capital deduction for other Tier 1 capital and regulatory capital deductions for Tier 2 capital 0. For the core Tier 1 capital, the paid-up capital that can be included in is 3,000.00 (million RMB), capital reserve 8,723.81(million RMB), surplus reserve 635.77(million RMB), general risk provision 755.58 (million RMB), and undistributed profit 1,583.07 (million RMB). Among the regulatory capital deductions for core Tier 1 capital, the net amount of other intangible assets (land-use right excluded) after related deferred tax liabilities is 43.37 (million RMB), and the core Tier 1 capital investment to financial institutions which are subject to the control right of the bank but not included into the financial statements amounts to 155.23 (million RMB). In the Tier 2 capital, the over loan loss provision is 7,345.00 (million RMB).

2. Paid-up capital

There is no change in the paid-up capital that can be included in during the year 2012, specifically as below:

Currency: million RMB Disclosure frequency: timely disclosure Items Paid-up capital Beginning balance 3,000.00 Current period increment 0 10

Current period decrease 0 Ending balance 3,000.00

3. Significant capital investment behavior The bank has no significant capital investment behavior during the year 2012.

Chapter III Equity Structure and Shareholders

I. Equity Structure Unit: individual share, 10,000 shares As of Dec. 31, 2011 Proportion (%) As of Dec. 31, 2012 1. Number of shareholders 3,678 3,685 (1) Number of corporate shareholders 122 3.32% 122 (2) Number of individual shareholders 3,556 96.68% 3,563 2. Amount of equity capital 300,000 300,000 (1) Equity capital of corporate 232,936.9772 77.65% 232,936.9772 shareholder (2) Equity capital of individual 67,063.0228 22.35% 67,063.0228 shareholder

II. Information of Shareholders

1. Equities held by the top 10 shareholders are shown as below: Unit: 10,000 Yuan, % Increase/ Total equities at the decrease in % of total Name of shareholder end of report the report capital stock period(10,000 Yuan) period (I) Suzhou International Development - 30,000 10.00 Group Co., Ltd. (II) Zhangjiagang Hongda Transport Co., - 19,500 6.50 Ltd. (III) SIP Economic Development Co., Ltd. - 18,000 6.00 (IV) Jiangsu Wuzhong Group Co., Ltd. - 13,538 4.51 (V) Bosideng Holdings Co., Ltd. - 13,300 4.43 (VI) Shenghong Group Co., Ltd. - 8,500 2.83 (VII) Suzhou Urban Construction & - 7,400 2.47 Investment Development Co., Ltd. (VIII) Jiangsu Guotai International Group - 7,000 2.33 Co., Ltd. (IX) Suzhou Xinxu Investment and - 5,000 1.67 Development Co., Ltd. (X) Suzhou Xiangcheng Jiangnan Chemical - 5,000 1.67 Fiber Group Co., Ltd.

2. Increase and decrease in registered capital, separation or merger

NONE.

3. Equity pledged and frozen of the shareholders holding 5% of total equities and more

Pledger Pledgee Obligor No. Name Original shares Pleged shares Current shares Name Name Period of pledge 12

Suzhou Suzhou Bank of International International Communication May 23, 2011 1 Development 300,000,000 50,000,000 250,000,000 Developmen s Suzhou – Jan. 1, 2014 Group Co., t Group Co., Branch Ltd. Ltd. Suzhou Suzhou International International COFCO Trust Dec. 4, 2012 2 Development 250,000,000 183,000,000 67,000,000 Developmen Co., Ltd. -Dec. 3, 2015 Group Co., t Group Co., Ltd. Ltd.

4. Information on controlling shareholders and actual controller

NONE.

5. Information on the shareholders holding 5% of total equities and more

(1) Suzhou International Development Group Co., Ltd. (hereinafter referred to as “SIDG”) SIDG was established in Aug. 1995, and was authorized the function of state-owned assets investment body by Suzhou Municipal People’s Government upon the approval of Jiangsu Provincial People’s Government at the end of 2001. During the municipal state-owned assets restructuring in 2003, Suzhou Municipal Committee and Government decided to build SIDG into a state-owned holding company with the financial investment as its main business. Through the past 5-year operation, SIDG has grown into a wholly state-owned company which combines such functions as financial service, capital management and assets management together, etc., with a “six-in-one” local financial platform integrating “bank, securities, insurance, trust, guarantee and venture” services.

With a registered capital of 1 billion Yuan, the group company has a board of directors set in line with the modern enterprise system. Since its establishment, the group company has maintained stable operation and steady development in the equity investment management, and achieved excellent economic benefits. As of the end of 2010, the total assets and net assets of the group company reached 25.2 billion Yuan and 6.6 billion Yuan respectively. (2) Zhangjiagang Hongda Transport Co., Ltd.: Established in Oct. 1993, Zhangjiagang Hongda Transport Co., Ltd. is a supplier of Sha Gang Group in the transport service of iron ore, coal, coke and accessories required in the production of all member factories, as well as such finished products as hot rolled steel coils, wide and thick plates, deformed steel bars, wires, plate blanks, square billets, etc.. The company follows the Sha Gang-centered concept, makes efforts to develop and promote the logistics management level of surrounding enterprises, so as to be a high-class supplier of logistics service for the mass customers.

At present, the company has 1,151 vehicles, including 549 heavy-duty vehicles, 10 medium ones, and 125 social vehicles are put into use. Steyr and Huizhong are the major suppliers of these vehicles. Meanwhile, the company is equipped with 9 sets of 25-45t imported Kalmar and Hyster large forklifts, 6 imported Komatsu trimming bulldozers, 8 sets of 25-100t mobile cranes, 1 set of 200t motor cranes, 7 sets of 8-50t motor cranes, 28 loaders and 35 sets of 8-10t forklifts, yielding an annual transport capacity as high as 13 million tons.

The company is currently engaged in the transporting and warehousing of steel and other general cargo, the loading, unloading and warehousing of raw materials and accessories, as well as the loading, 13

unloading and transporting of super large and super heavy goods such as various equipment and facilities, etc., and has reached a relatively high level in the loading, unloading and transporting capacity of medium and heavy plates and equipments, in a position to meet the requirements of various customers on professional logistics.

The company avails itself of and uses for reference the advanced experience on dock management both at home and abroad, and constantly taps the potentials, improves the capabilities and maintains strict management, resulting in an increasingly rising transport amount and loading efficiency.

For the purpose of making the best of social logistics resources and improving the management level and efficiency of the company, Hongda Transport Company makes active utilization and integration of social logistics resources, to develop the power and effect of social logistics resources to the full, and in this way, increase the logistics management level of Hongda Transport Company. The company presently applies the partial labor outsourcing, specifically, the outsourcing of partial general cargo loading, unloading and transporting, etc., improving the dock working efficiency; the outsourcing of partial dock transporting, greatly reducing the logistics cost of the company and improving the working efficiency; and the commission of management and operation of shipping agent and freight forwarding agent for exports and imports given to professional logistics companies, improving the logistics management level and efficiency of the company.

Looking into the future, Hongda Transport Company will establish the working measures towards the target of improving the logistics level and reducing the logistics cost, so as to get involved into the international logistics platform. Such measures are made from the following six aspects: first, reinforcing and improving the information management of logistics, and developing a professional logistics information operation system; second, integrating the existing logistics resources and adding partial fundamental logistics facilities; third, expanding the logistics base and building up an open, integrated and shared logistics base mainly for Sha Gang as well as surrounding enterprises; fourth, establishing a stable transport team and absorbing the community transport forces to increase the transport capacity of logistics; fifth, strengthening the service concept of socialization, achieving the shared logistics, and functioning in serving the enterprises and expediting the social economic prosperity; sixth, extending the logistics service chain and improving the initiative in management.

The development of Zhangjiagang Hongda Transport Co., Ltd. depends on the support of social logistics system. Accordingly, the company will further develop the labor and transport outsourcing, to take full advantage of the social fundamental logistics facilities, enhance the operating efficiency of idle fundamental logistics facilities, and bring along the entire surrounding logistics system in efficiency, service level and management capability, achieving information and resource sharing and mutual complementarily, and in this way driving the whole society in logistics development.

(3) SIP Economic Development Co., Ltd.: SIP Economic Development Co., Ltd. (“Suzhou Consortium”), with the registered capital of 1.8 billion Yuan, is a wholly state-owned company affiliated to Suzhou Industrial Park Administrative Committee (“SIPAC”).

SIP Economic Development Co., Ltd. (“Suzhou Consortium”) grew out of Suzhou Singapore Industrial Park United Development General Corp., which was established on Dec. 31, 1993 with the registered capital of USD 25 million contributed by 10 units in Suzhou. 14

On Jan. 10, 1996, Suzhou Singapore Industrial Park United Development General Corp. was renamed as SIP Economic Development Co., Ltd., with its registered capital increased to USD 50 million from the original USD 25 million, to keep up with and accelerate the new trend of Suzhou Industrial Park in development and construction. In July, SIP Economic Development Co., Ltd. set up five controlled subsidiaries respectively engaged in industry, real estate, tourism, public utility and science.

On Feb. 21, 1997, upon the approval of Jiangsu Provincial Government, SIP Economic Development Co., Ltd. changed its name to SIP Economic Development Holdings Co., Ltd., which had 5 controlled companies and 16 equity participation companies, with the total equity of 416,500,000 Yuan and the total operating assets of up to 600 million Yuan, becoming the operating entity of stated-owned assets in Suzhou Industrial Park. On Jun. 17, the establishment meeting and first meeting of shareholders was held by SIP Economic Development Holdings Co., Ltd.

With the approval of SIP Work Committee and Administrative Committee, on Sept. 15, 2003, SIP Economic Development Holdings Co., Ltd. conducted the reorganization with SIP Commercial Tourism Development Group Co., Ltd., resulting in the foundation of SIP Commercial Tourism Development Group Co., Ltd. (SIP Economic Development Holdings Co., Ltd.), which applied the management mode of “one group and two brands”.

With the approval of SIP Work Committee and Administrative Committee, on Feb. 3, 2005, SIP State-owned Assets Holding Development Co., Ltd. (SIP State-owned Assets Supervision and Management Office) was established through the reorganization and consolidation of SIP State-owned Assets Operation Company and SIP Economic Development Holding Co., Ltd., so as to further reinforce the state-owned assets management. On Nov. 1, 2005, SIP Economic Development Holding Co., Ltd. became known as SIP Economic Development Co., Ltd. upon the approval of Jiangsu Provincial Administration for Industry and Commerce.

On Sep. 11, 2009, as CSSD went public, with the approval of Suzhou Municipal Government, SIP Economic Development Co., Ltd. had all its equities transferred to SIP Administrative Committee from the state-owned company, so as to prevent horizontal competition arising between CSSD and the state-owned company and its controlled subsidiaries.

On Jul. 27, 2010, SIP Economic Development Co., Ltd. received a capital increase of 1,300,500,000 Yuan contributed by SIP Administrative Committee. The registered capital changed to RMB 1.8 billion Yuan.

6. Other significant information deemed necessary to be made public:

Profit Distribution Plan or Capitalizing Plan of Common Reserves Based on the audit of Ernst & Young, in 2012 the total profit of our bank was 1,670,271,800 Yuan, the income tax 355,267,400 Yuan, and the net profit 1,315,004,400 Yuan. As of the beginning of 2012, the undistributed profit was 1,179,952,500 Yuan. In accordance with the resolution concerning the approval of Proposals on Profit Distribution Plan in 2011 made in the first meeting of shareholders in 2012 held by Bank of Suzhou Co., Ltd., such withdrawals were made: 101,142,400 Yuan for statutory surplus reserve, 50,571,200 Yuan for other surplus reserve, 549,080,300 Yuan for general risk provision, and 450,000,000 for common stock dividends; based on the audit of 2012, an additional withdrawal of 30,358,000 Yuan was made for statutory surplus reserve. The distributable profit was 1,313,805,000 Yuan at the end of 2012. In

line with pertinent fiscal and tax policies and the regulations provided by competent regulatory organs, the following proposals on annual profit distribution in 2012 are made:

I. Withdrawal of statutory surplus reserve: 131,500,400 Yuan, accounting for 10% of audited net profit in 2012;

II. Withdrawal of other surplus reserve: 65,750,200 Yuan, accounting for 5% of audited net profit in 2012;

III. Withdrawal of general risk provision: 516,500,000 Yuan, accounting for 39.28% of audited net profit in 2012;

IV. Profit available for distribution to shareholder: 600,000,000 Yuan, 2 Yuan paid per 10 shares (tax included, 1.6 Yuan after tax).

V. Undistributed profit after the aforesaid distribution: 54,400 Yuan.

The net asset value per share was 4.90 Yuan at the end of 2012, 0.37 Yuan higher than 4.53 Yuan per share at the end of 2011; the earnings per share reached 0.44 Yuan in 2012, 0.10 Yuan higher than 0.34 Yuan in 2011; the rate of return on capital was 9.30% in 2012, increased by 1.67% compared to 7.63% in 2011.

Chapter IV Directors, Supervisors, Senior Management & Employees

I. Structure of Board of Directors and Working Status

(I) Basic information of Bank of Suzhou BOD As of the end of 2012, the first session of board of directors of Bank of Suzhou Co., Ltd. comprises of 16 members, including 3 inside directors, 10 outside directors and 3 independent directors.

(II) Basic information of members of the 1st session of Bank of Suzhou BOD

Wang Lanfeng Board Chairman, female, born in September 1963, Education background: Bachelor of Finance in Tianjin University of Finance and Economics, Master of Business Administration in Shanghai University of Finance and Economics, Senior Economist. Working status: a teacher in Inner Mongolia Bank School from July 1985 to September 1987; successively held the posts of Vice Director of Business Dept., Deputy Chief of Accounting Section, and Section Chief of International Settlement Section in Baotou Branch, BOC since September 1987; assumed the posts of President and Secretary of Party Branch in July 1997 (deputy division level); assumed the post of Director of Settlement Business Division in Inner Mongolia Branch, BOC in February 1999; assumed the posts of President and Secretary of Party Branch in Suzhou Direct Sub-branch of China Everbright Bank in December 2000; assumed the posts of President and Secretary of CPC in Suzhou Branch of China Everbright Bank in October 2003; assumed the posts of President and Secretary of CPC in Shanghai Branch of China Everbright Bank in April 2007; assumed the posts of President Assistant of HQ China Everbright Bank and President & Secretary of CPC in Shanghai Branch of China Everbright Bank in September 2010; assumed the post of Secretary of CPC of Bank of Suzhou in July 2011; assumed the posts of Director and Board Chairman of Bank of Suzhou in January 2012.

Xu Ting Director& President, male, born in August 1970, Education background: Bachelor of Accounting in Soochow University, Master of Business Administration in Fudan University, Certified Public Accountant. Working status: worked in CCB Suzhou Branch Trust and Investment Company since August 1993; assumed the post of Vice President (temporary) of Taicang Sub-branch of CCB in April 1996; assumed the post of Vice President of Suzhou Industrial Park Sub-branch of CCB from August 1997 to February 2001; Vice General Manager of Business Department of Suzhou Branch of CCB from February to March 2001; assumed the posts of President and Secretary of CPC of Taicang Sub-branch of CCB in March 2001; assumed the posts of President and Secretary of General Party Branch of Suzhou Industrial Park Sub-branch of CCB from October 2002 to August 2006; assumed the posts of Vice President and CPC Member of Suzhou Branch of CCB from August 2006 to December 2011; assumed the posts of Deputy Secretary of CPC of Bank of Suzhou in December 2011 and then President and Director of Bank of Suzhou in September 2012.

Jiang Li Director, male, born in July 1963, Education background: undergraduate, Assistant Economist. Working status: ever worked in Agricultural Bank of China in Suzhou, Cooperation Section of 17

People’s Bank in Suzhou, Xietang Office of Suzhou Urban District Rural Credit Cooperatives, Wuzhong District Sub-branch of Jiangsu Dongwu Rural Commercial Bank, Board of Directors of Jiangsu Dongwu Rural Commercial Bank Wuzhong District Sub-branch since 1981, holding the posts of staff member, chief, president and BOD Secretary successively; assumed the post of Director of Bank of Suzhou since September 2010, and currently holds the post of BOD Secretary of Bank of Suzhou, receiving remunerations from the company, holding 454,448 shares in the beginning of 2012 and the same number at the end of 2012, which accounts for 0.015% of the total registered capital.

Yuan Weijing Director, female, born in July 1963, Education background: undergraduate, Senior Accountant. Working status: ever worked in Suzhou Bureau of Finance, Suzhou Industrial Development Co., Ltd., Suzhou Yingcai Development Group Company and Suzhou International Development Group in the posts of staff member, Vice General Manager, General Manager, Deputy Chief Accountant and Chief Accountant since 1981; currently holds the posts of CPC Member and Chief Accountant in Suzhou International Development Group; acts as the Director of Bank of Suzhou since September 2010.

Zhou Wenqing Director, male, born in June 1966, Education background: Doctor. Working status: ever worked in Guiyang Medical University, Peking University Health Science Center, Guiyang Medical University, Sun Yat-Sen University Faculty of Medical Sciences, SIP Provident Fund Management Center; and currently acts as the Vice-President of SIP State-owned Assets Holding & Development Co., Ltd.; acts as the Director of Bank of Suzhou since September 2010.

Wen Zhenying Director, female, born in January 1956, Education background: undergraduate. Working status: ever worked in Zhangjiagang No. 3 Machinery Plant and Zhangjiagang Foreign Economy and Trade Bureau since 1973; now holds the post of Chief Accountant in Jiangsu Guotai International Group Co., Ltd.; acts as the Director of Bank of Suzhou since September 2010.

Ge Xiangqian Director, male, born in February 1943, Education background: Senior High School. Working status: ever worked in Group12 Brigade 3 Sanxing Shazhou County, Shazhou Universal Machinery Plant, Jiangsu Sha Gang Group Co., Ltd. since 1969; currently acts as the Chief Accountant in Zhangjiagang Hongda Transportation Co., Ltd.; acts as the Director of Bank of Suzhou since September 2010.

Gao Dekang Director, male, born in February 1952, Education background: Junior College. Working status: ever worked in Baimao Town Shanjing Garment Factory, Baimao Down and Feather Garment Factory, Jiangsu Kangbo Group Co., Ltd. since 1976; and currently acts as the Board Chairman and President of Bosiden Co., Ltd.; acts as the Director of Bank of Suzhou since September 2010.

Meng Weiyuan Director, male, born in April 1973, Education background: Junior College.

Working status: ever worked in Shenghong Printing and Dyeing Mill, Baimao Down and Feather Garment Factory since 1993; currently acts as the Vice General Manager and CFO in Shenghong Group Co., Ltd.; and acts as the Director of Bank of Suzhou since September 2010.

Yuan Xiaofeng Director, male, born in January 1981, Education background: undergraduate. Working status: ever worked in Suzhou Small Antelope Electric Bicycle Co., Ltd., Jiangsu Jiangnan High Polymer Fiber Co., Ltd. since 2003; currently acts as the Head of Financial Department in Suzhou Xiangcheng Jiangnan Chemical Fiber Group Co., Ltd.; and acts as the Director of Bank of Suzhou since September 2010.

Ye Xiaoming Director, female, born in February 1967, Education background: undergraduate, Economist. Working status: ever assumed the positions of Section Chief, Department Manager and Vice General Manager in People’s Bank of China Suzhou Branch, Dongwu Securities, Jiangsu Wuzhong Group Co., Ltd. since 1985; currently acts as the Vice General Manager in Jiangsu Wuzhong Group Co., Ltd.; and acts as the Director of Bank of Suzhou since September 2010.

Lu Xingnan Director, male, born in February 1963, Education background: undergraduate. Working status: ever worked in China Animal Husbandry Group East China Branch, USA Conti Feed Group since 1985; currently acts as the Executive Director of Suzhou Haijing Information Technology Group Co., Ltd.; and acts as the Director of Bank of Suzhou since September 2010.

Ni Xiaochun Director, male, born in March 1962, Education background: Junior College. Working status: have been working in Suzhou Institute of Architectural Design since 1980, currently holding the position of CFO in Suzhou Institute of Architectural Design Co., Ltd.; and acts as the Director of Bank of Suzhou since September 2010.

Wang Ke Independent Director, male, born in January 1947, Education background: Junior College, Senior Economist. Working status: ever worked in Fund Appropriation Office, Planning Department, HR Department, Cooperation Department of Head Office of Agricultural Bank of China, Regulatory Section of Cooperative Financial Institutions of People’s Bank of China, and Cooperation Department of China Banking Regulatory Commission, holding the positions of Staff Member, Deputy Section Chief, Deputy Director, Deputy Manager and Deputy Director, from 1979 to 2007; and acts as the Independent Director of Bank of Suzhou since September 2010.

Ling Xiaohua Independent Director, male, born in August 1950, Education background: undergraduate, senior economist. Working status: ever worked in Nantong State Farm, Suzhou School of Finance and Economy Bank,

People’s Bank in Liyang County, Agricultural Bank of China in Liyang County, People’s Bank of China Suzhou Branch, People’s Bank of China Jiangsu Provincial Branch, People’s Bank of China Suzhou Municipal Central Sub-branch, and People’s Bank of China Nanjing Branch, holding the posts of Clerk, Accountant, Credit Administrator, Section Chief, Deputy Director, Vice President, President, Assistant Inspector from 1968 to 2010; and acts as the Independent Director of Bank of Suzhou since September 2010.

Yang Haikun Independent Director, male, born in August 1944, Jiangsu Suzhou native, who began to work in 1968, acting as the professor and doctorial tutor, and now is a present professor in Kenneth Wang School of Law ,Soochow University and the head of Dongwu Institute of Comparative Law. Working status: studied in Department of Philosophy, Renmin University of China from 1962 to 1968; worked in Jiangsu Liyang Military Farm from 1968 to 1970; acted as a teacher in Shanghai Qingpu Daying Middle School from 1970 to 1980; engaged in the research work in Institute of Law, Shanghai Academy of Social Sciences from 1980 to 1985, including the study life in Shanghai Fudan University in the first half of 1982; worked in Kenneth Wang School of Law, Soochow University as the Director of Staff Room, Deputy Director of Law Department, Deputy Dean, Dean, etc. since 1985, including the study life in China University of Political Science and Law in the first half of 1985; and acts as the Independent Director of Bank of Suzhou since August 2012.

II. Structure of Board of Supervisors and Working Status

(I) Basic information of Bank of Suzhou BOS By the end of 2012, the first session of board of supervisors of Bank of Suzhou Co., Ltd. comprises of 9 members, including 2 inside supervisors and 7 shareholder supervisors.

(II) Basic information of members of the 1st session of Bank of Suzhou BOS

Gu Nanxing Chief Supervisor, male, born in November 1958, Education background: undergraduate, Economist. Working status: from 1982 to June 2011, ever worked in Agricultural Bank of China Wuxian Taihu Business Office, Wuxian Credit Cooperatives, Suzhou Urban District Credit Cooperatives, Jiangsu Dongwu Rural Commercial Bank, Bank of Suzhou, assuming the posts of Director, Deputy Director, Deputy Director, President successively, with the remunerations paid by the company; held 511,434 shares in the beginning of 2012 and the same number at the end of 2012, which accounts for 0.017% of the total registered capital.

Zhu Zhenming Supervisor, male, born in February 1968, Education background: undergraduate, Assistant Economist. Working status: began to work in December 1988 and currently acts as Deputy General Manager of Supervision and Security Department in Bank of Suzhou; acts as Supervisor of Bank of Suzhou since September 2010; held 263,363 shares in the beginning of 2012 and the same number at the end of 2012, which accounts for 0.009% of the total registered capital.

Pan Yong 20

Supervisor, male, born in September 1968, Education background: undergraduate, Accountant, CPC Member Working status: started to work in August 1990, and currently holds the post of Vice General Manager in Suzhou Urban Construction and Development Co., Ltd.; acts as the Supervisor of Bank of Suzhou since September 2010.

Kong Li Supervisor, female, born in October 1962, Education background: undergraduate, Senior Economist, Accountant, CPC Member Working status: started to work in October 1980, and currently holds the post of Vice General Manager and Chief Accountant in Suzhou New District Economic Development Group Corporation; acts as the Supervisor of Bank of Suzhou since September 2010.

Shen Zhe Supervisor, male, born in August 1965, Education background: Junior College, Real Estate Appraiser, CPC Member. Working status: started to work in June 1983, and currently holds the post of General Manager of Suzhou Wuzhong Urban Construction Investment & Development Co., Ltd.; acts as the Supervisor of Bank of Suzhou since September 2010; held 366,219 shares in the beginning of 2011 and the same number at the end of 2011, which accounts for 0.012% of the total registered capital.

Cao Haiyan Supervisor, female, born in April 1974, Education background: undergraduate, Accountant. Working status: started to work in August 1993, and currently holds the post of General Manager in Suzhou Xiangtang Guarantee Co., Ltd.; acts as the Supervisor of Bank of Suzhou since September 2010.

Xu Caiying Supervisor, female, born in May 1964, Education background: Junior College Degree, Accountant. Working status: started to work in August 1980, and currently holds the post of CFO of Kunshan Huachen Group; acts as the Supervisor of Bank of Suzhou since September 2010.

Shen Hongmei Supervisor, female, born in December 1970, Education background: Junior College, Accountant Working status: started to work in 1990, and currently holds the post of Section Chief of Finance in Suzhou Sanwei Enterprise Group Co., Ltd.; acts as the Supervisor of Bank of Suzhou since September 2010.

Jin Yugen Supervisor, male, born in April 1963, Education background: undergraduate, Economist, CPC Member Working status: started to work in August 1984, and currently holds the post of General Manager of Suzhou Jingsiyuan Investment Co., Ltd.; acts as the Supervisor of Bank of Suzhou since September 2010; held 5,000,293 shares in the beginning of 2012 and the same number at the end of 2012, which accounts for 0.167% of the total registered capital.

III. Senior Management and Employees

(I) Brief Information on Senior Management of Bank of Suzhou

Xu Ting Director & President, male, born in August 1970, Bachelor of Accounting in Soochow University, MBA in Fudan University, Certified Public Accountant; worked in CCB Suzhou Branch Trust and Investment Company since August 1993; assumed the post of Vice President (temporary) of Taicang Sub-branch of CCB in April 1996; assumed the post of Vice President of Suzhou Industrial Park Sub-branch of CCB from August 1997 to February 2001; Vice General Manager of Business Department of Suzhou Branch of CCB from February to March 2001; assumed the posts of President and Secretary of CPC of Taicang Sub-branch of CCB in March 2001; assumed the posts of President and Secretary of General Party Branch of Suzhou Industrial Park Sub-branch of CCB from October 2002 to August 2006; assumed the posts of Vice President and CPC Member of Suzhou Branch of CCB from August 2006 to December 2011; assumed the posts of Deputy Secretary of CPC of Bank of Suzhou in December 2011 and then President and Director of Bank of Suzhou in September 2012.

Gu Ping Vice President, male, born in April 1959, undergraduate, Economist, assisting the President to take charge of the bank affairs and taking charge of finance planning, operation settlement, security guard and fundamental construction. Having engaged in the financial industry for 30 years (1980-2010), ever worked in Agricultural Bank of China Wuxian Wangting Business Office, Xuguan Business Office, Suzhou Rural Office, Suzhou Suburban Credit Cooperatives, Suzhou Urban District Credit Cooperatives, Jiangsu Dongwu Rural Commercial Bank, holding the posts of Supervisor, Vice Chairman of Trade Union, Director of Office (General Affairs Department), Director of Capital Operation Department, Deputy Director of Cooperatives and Vice President successively; acts as the Vice President of Bank of Suzhou since September 2010; held 1,004,739 shares in the beginning of 2011 and the same number at the end of 2011, which accounts for 0.034% of the total registered capital.

Zhang Shuinan Vice President, male, born in April 1965, undergraduate, Economist, takes charge of retailing and e-banking business. Having engaged in the financial industry for 24 years (1986-2010), ever worked in People’s Bank of China Suzhou Central Sub-branch, Suzhou Urban District Credit Cooperatives, Jiangsu Dongwu Rural Commercial Bank, holding the posts of Deputy Chief of Credit Dept., Deputy Chief of Cooperation Dept. (in charge of work), Deputy Director of Cooperatives and Vice President successively; acts as the Vice President of Bank of Suzhou since September 2010; held 868,791 shares in the beginning of 2011 and the same number at the end of 2011, which accounts for 0.029% of the total registered capital.

Qian Feng Vice President, male, born in October 1971, undergraduate, Economist, manages Suzhou Business Management HQ, while taking charge of the affairs of Bank Head Office Business Department. Having engaged in the financial industry for 21 years (1989-2010), ever worked in Wuxian Huangdai Credit Union, Agricultural Bank of Suzhou Wuxian, Wuxian Credit Cooperatives, Suzhou Urban District Credit 22

Cooperatives, Jiangsu Dongwu Rural Commercial Bank, holding the posts of Assistant Section Chief, Deputy Chief, Chief of Credit Dept., Vice President successively; acts as the Vice President of Bank of Suzhou and Director of Suzhou Business Management HQ since September 2010; held 932,792 shares in the beginning of 2012 and 702,792 shares at the end of 2012, accounting for 0.023% of the total registered capital and decreased by 230,000 shares in the year 2012.

Hou Bin President Assistant, male, born in March 1968, undergraduate, Economist, in charge of credit management, having been engaged in the financial industry for 21 years (1989-2010), ever worked in Bank of Communications Suzhou Branch, Suzhou Datong Auto Lease Company, Suburban-Rural Credit Cooperatives, Suzhou Urban District Credit Cooperatives, Jiangsu Dongwu Rural Commercial Bank, assuming the posts of Assistant Section Chief, Deputy Chief, Section Chief, Director of Union, General Manager of Risk Management Department, President Assistant successively; acts as the President Assistant of Bank of Suzhou since September 2010; held 539,148 shares in the beginning of 2012 and the same number at the end of 2012, accounting for 0.018% of the total registered capital.

Pan Wenbing President Assistant, male, born in September 1967, undergraduate, Economist, in charge of science& technology information and small& micro financial business affairs, having been engaged in the financial industry for 27 years (1984-2010), ever worked in Suburban-Rural Credit Cooperatives, Suzhou Urban District Credit Cooperatives, Jiangsu Dongwu Rural Commercial Bank, holding the posts of Deputy Chief of Credit Dept., Director of Credit Union, General Manager of Audit Dept., and President Assistant successively; acts as the President Assistant of Bank of Suzhou since September 2010; held 539,148 shares in the beginning of 2012 and the same number at the end of 2012, accounting for 0.018% of the total registered capital.

Zheng Wei President Assistant, male, born in November 1972, undergraduate, Assistant Economist, in charge of company business, “three rural issues” and international business, having been engaged in the financial industry for 20 years (1992-2011), ever worked in Yangchenghu Credit Union, Wuxian Credit Union Office, Suzhou Urban District Cooperatives Office, Chefang Credit Union, Party Committee Office of Suzhou Urban District Cooperatives, Jiangsu Dongwu Rural Commercial Bank, Jiangsu Yancheng Huanghai Rural Commercial Bank, holding the posts of Assistant of Office Director, Deputy Director, Director, Board Secretary and Vice President successively; acts as the President Assistant of Bank of Suzhou since September 2011; held 448,336 shares in the beginning of 2012 and the same number at the end of 2012, accounting for 0.015% of the total registered capital.

(II) Details on senior management of Bank of Suzhou including President, Vice President, President Assistant, Board Secretary, Financial Controller, etc. Termination Cause of Name Title Sex Age Tenure date termination Xu Ting President Male 42 2012.09-2013.08

Gu Ping Vice President Male 54 2010.09-2013.08

Zhang Shuinan Vice President Male 48 2010.09-2013.08

Qian Feng Vice President Male 42 2010.09-2013.08 President Hou Bin Male 45 2010.09-2013.08 Assistant President Pan Wenbing Male 46 2010.09-2013.08 Assistant President Zheng Wei Male 41 2011.09-2013.08 Assistant Jiang Li Board Secretary Male 50 2010.09-2013.08 Risk Compliance Sun Hongya Dept. Female 51 2010.09-2013.08 General Manager Planning& Chen Jie Finance Dept. Female 38 2012.09-2013.08 Controller Credit Management Song Zhaohui Dept. Male 44 2012.09-2013.08 General Manager Audit Dept. Fang Min Male 52 2010.09-2013.08 General Manager

(III) Employees

1. Analysis on total quantity of human resources as of the end of 2012

(1) Total quantity of personnel As of Dec. 31, 2012, Bank of Suzhou had 1,997 employees on the strength, reaching an all-time high. A net growth of 455 persons was seen compared to that by the end of 2011, increased by 29.5%.

Operating Organ Head Office of Bank Total Number Year Ending Ending Ending Net growth proportion Net growth proportion Net growth proportion amount amount amount 2012 1591 347 27.9% 406 108 36.2% 1997 455 29.5%

(2) Analysis on educational level: As of the end of 2012, the educational level throughout the entire bank is shown in the figure below:

Doctor博士 0.1% Postgraduate研究生 6.6% Doctor博士 Junior college and 大专及以下lower 37.4% Postgraduate研究生

University本科 Degree

Junior大专及以下 college and lower University本科 graduate 55.9%

Year-on-year Proportion taken Degree 2012 growth at the end of 2012 Doctor 2 0.0% 0.1% Postgraduate 132 112.9% 6.6% undergraduate 1116 57.0% 55.9% Junior college 747 -2.5% 37.4% and lower Total 1997 29.6% 100%

At the end of 2012, there were 134 talents holding the master degree or above in our bank. The talents with higher diploma took up to 6.7% in total employees, 2.6% higher than that by the end of 2011. The number of employees with a Bachelor degree reached 1,116, increased by 57% compared to the same period of previous year, and demonstrating an increasingly growing proportion of total employees. The talent density, viz. the proportion of employees with a Bachelor degree or above of total employees, was 62.6%, 12.3% higher than that by the end of 2011.

(3) Analysis on gender structure:

2500

2000

1500 957 女F 746 1000 男M

500 1040 796

0 2012年 2011年

2012 Gender Number Proportion Male 1,040 52.1% Female 957 47.9% Total 1,997 100.0%

Among the total quantity of human resources of this Company in 2012, 1,040 persons were male and 957 female. The proportion of male to female was 1.09:1, showing a modest growth of male compared to that by the end of 2011.

In 2012, the Company applied the remuneration policy following the following concepts: closely centering on the development strategy and major operation targets of 2012, giving full play to the positive incentive effect of remuneration resources on “risk control, achievement and efficiency comes first with reasonable consideration to equality”, reinforcing the assessment restriction by controlling total remuneration, and building up the business concept of input profitability and value; meanwhile, further regulating and perfecting the employee welfare management, in order to establish a remuneration & welfare system in compliance with the requirements of modern banking development.

In 2012, the Company established the “three-year” development plan of “fundamental construction, overall promotion and innovative improvement” on the aspect of training, to construct a purposeful training system with arrangements of ideas and advanced methods. A series of fundamental management methods with regard to training organization, incentive and internal training, etc. had been worked out successively, the first batch of internal trainers in Bank of Suzhou were turned out, and a series of training works for HQ medium and senior management, sub-branch president, and reserve cadres, etc. had been carried out; meanwhile, the training assessment management system and the electronic attendance system for training had been developed. In 2012, the Company held 119 off-line trainings within budget as well as 114,535-hour online network training.

IV. Organization

No. Name of Institution Contact Address Tel 1 Headquarter of Bank of Suzhou 728 Zhongyuan Road, Suzhou Industrial 69868023

Park Suzhou Sub-branch of Bank of 2 143 N. Dongwu Road, Suzhou City 65616661 Suzhou Kunshan Sub-branch of Bank of 3 386 E. Qianjin Road, Kunshan City 36801993 Suzhou Zhangjiagang Sub-branch of 4 11 E. Renmin Road, Zhangjiagang City 56318993 Bank of Suzhou Zhangjiagang Jinfeng Jinjiang Mall, Jindian Road, Jinfeng Town, 5 56318998 Sub-branch of Bank of Suzhou Zhangjiagang City Zhangjiagang Jingang 61 M. Changjiang Road, Jingang Town, 6 56318908 Sub-branch of Bank of Suzhou Zhangjiagang City Changshu Sub-branch of Bank of 7 12 Huanghe Road, Changshu City 51915801 Suzhou Urban Sub-branch of Bank of 8 56 W. Ganjiang Road, Suzhou City 65113598 Suzhou 9 Wujiang Sub-branch of Bank of 2211 Huayuan Road, Songling Town, 63002053 10 Suzhou Wujiang District, Suzhou City Suzhou Shengze Sub-branch of 66 W. Shunhu Road, Shengze Town, 10 63003351 Bank of Suzhou Wujiang District, Suzhou City Taicang Sub-branch of Bank of 1 E. Shanghai Road, Chengxiang Town, 11 53205801 Suzhou Taicang City Taicang Liuhe Sub-branch of 30 E. Zhenghe Road, Liuhe Town, Taicang 12 53205800 Bank of Suzhou City Wuzhong Sub-branch of Bank of 1, Bldg. 3, Trade Mart, Guangjian Road, 13 65611501 Suzhou Wuzhong District, Suzhou City Luzhi Sub-branch of Bank of 8 Mingshi Road, Luzhi Town, Wuzhong 14 65010210 Suzhou District, Suzhou City Guoxiang Sub-branch of Bank of 3 E. Guoxin Road, Guoxiang Town, Suzhou 15 65961840 Suzhou City Changqiao Sub-branch of Bank 110 Changxing Road, Changqiao Town, 16 65635369 of Suzhou Suzhou City Guangfu Sub-branch of Bank of Bldg. 117, M. Dengwei Road, Guangfu 17 66231147 Suzhou Town, Suzhou City Mudu Sub-branch of Bank of West Side of Jinshan Road, Mudu Town, 18 66263561 Suzhou Suzhou City Cangshu Sub-branch of Bank of 19 Shixu Road, Zangshu Town, Suzhou City 66931598 Suzhou Xukou Sub-branch of Bank of 622-5~8, Sunwu Road, Xukou Town, Suzhou 20 66312523 Suzhou City Hengjing Sub-branch of Bank of 8 Wujialongkou, Hengjing Town, Suzhou 21 66202783 Suzhou City Puzhuang Sub-branch of Bank of 29 South Street, Puzhuang Town, Suzhou 22 66532692 Suzhou City 23 Linhu Sub-branch of Bank of 13 Tengfei Road, Linhu Town, Suzhou City 66521739 27

Suzhou Yuexi Sub-branch of Bank of 24 9 Wushan Street, Yuexi Town, Suzhou City 66551372 Suzhou Dongshan Sub-branch of Bank of 5 Dongting Road, Dongshan Town, Suzhou 25 66281255 Suzhou City Jinting Sub-branch of Bank of 26 144 Jinting Road, Jinting Town, Suzhou City 66271223 Suzhou Vacation Zone Sub-branch of Crossing of Wanghu Road, Suzhou Taihu 27 66211044 Bank of Suzhou National Tourism Vacation Zone Xiangcheng Sub-branch of Bank E. Yiangchenghu Road, Lumu Town, Suzhou 28 65493275 of Suzhou City Wangting Sub-branch of Bank of Bldg. 12, Central Downtown, Wangting 29 65380160 Suzhou Town, Suzhou City Yuanhe Sub-branch of Bank of 10 M. Lizhong Road, Likou Town, Suzhou 30 65452605 Suzhou City Huangqiao Sub-branch of Bank 120 East Street, Huangqiao Town, Suzhou 31 65461046 of Suzhou City Weitang Sub-branch of Bank of 4 M. Weizhong Road, Weitang Town, 32 65409790 Suzhou Suzhou City Huangdai Sub-branch of Bank of 256 Chunfeng Road, Huangdai Town, 33 65481129 Suzhou Suzhou City Beiqiao Sub-branch of Bank of 26 Chengmei Street, Beiqiao Town, Suzhou 34 65413042 Suzhou City Dongqiao Sub-branch of Bank of 21 N. Changkang Road, Dongqiao Town, 35 65372797 Suzhou Suzhou City Yangchenghu Sub-branch of 55 M. Chengzhong Road, Xiangcheng Town, 36 65421610 Bank of Suzhou Xiangcheng District, Suzhou City Taiping Sub-branch of Bank of Jincheng Road, Taiping Sub-district, 37 65433807 Suzhou Xiangcheng District, Suzhou City Industrial Park Sub-branch of 38 199 Cuiyuan Road, Suzhou Industrial Park 62806128 Bank of Suzhou Loufeng Sub-branch of Bank of 69 Nanbaiyan Street, Loufeng Town, Suzhou 39 67250867 Suzhou Industrial Park Yangdong Sub-branch of Bank 40 207 Yangdong Road, Suzhou Industrial Park 67260682 of Suzhou Xietang Sub-branch of Bank of Lotus Plaza, Dongyan Road, Xietang Town, 41 65473519 Suzhou Suzhou Industrial Park Shengpu Sub-branch of Bank of Xingpu Road, Shengpu Town, Suzhou 42 62811215 Suzhou Industrial Park Weiting East District Sub-branch 288-1 Jinling Road, Weiting Town, Suzhou 43 65078750 of Bank of Suzhou Industrial Park Weiting West District 50 Kuanan Road, Weiting Town, Suzhou 44 62748392 Sub-branch of Bank of Suzhou Industrial Park 45 Chefang Sub-branch of Bank of Puhui Road, Chefang Town, Suzhou City 65923286 28

Suzhou Shishan Road Sub-branch of Gold River International Building, 35 46 68780416 Bank of Suzhou Shishan Road, Suzhou New District Tongan Sub-branch of Bank of 9, Bldg. 6, Huatong Commercial Plaza, 47 66063646 Suzhou Tong’an Town, Suzhou City Dongzhu Sub-branch of Bank of 48 West Street, Dongzhu Town, Suzhou City 66892642 Suzhou Zhenhu Sub-branch of Bank of 223 Xiupin Street, Zhenhu Town, Suzhou 49 66911040 Suzhou City Huqiu Sub-branch of Bank of 2-8 Daguan Road, Pingjiang District, Suzhou 50 65342351 Suzhou City New & Hi-tech Industrial 51 Development Zone Sub-branch 485 Changjiang Road, Suzhou City 65369569 of Bank of Suzhou Hengtang Sub-branch of Bank of West Side of Jinyuan Bridge, Hengtang New 52 68231796 Suzhou Town, Suzhou City Xuguan Sub-branch of Bank of 101 Yonglian Road, Xuguan Town, Suzhou 53 65393011 Suzhou City Xushuguan Economic 54 Development Zone Sub-branch 38 Hongfu Road, Suzhou New District 66710246 of Bank of Suzhou Nanmen Sub-branch of Bank of 688 Zhuhui Road, Canglang District, Suzhou 55 65198021 Suzhou City Fenghuang Street Sub-branch of 56 221 Fenghuang Street, Suzhou City 65197315 Bank of Suzhou Hudong Sub-branch of Bank of 728 Zhongyuan Road, Suzhou Industrial 57 69868023 Suzhou Park Ganjiang Sub-branch of Bank of 58 572 W. Ganjiang Road, Suzhou City 65310975 Suzhou Sanxiang Road Sub-branch of 59 188 Sanxiang Road, Suzhou City 65327762 Bank of Suzhou Tongjing Sub-branch of Bank of 60 555 E. Jiefang Road, Suzhou City 68202621 Suzhou Pingmen Sub-branch of Bank of 61 1755 Renmin Road, Suzhou City 65127982 Suzhou Suqian Branch of Bank of 80 Qinghaihu Road, Sucheng District, Suqian 62 0527-88000558 Suzhou City Dongtai Sub-branch of Bank of 63 36 E. Wanghai Road, Dongtai City 0515-89515558 Suzhou Sucheng Sub-branch of Bank of 64 11 W. Hongzehu Road, Suqian City 0527-84500376 Suzhou Lianshui Sub-branch of Bank of 8 West Ave., Changqing Road, Lianshui 65 0517-82352005 Suzhou County 66 Dafeng Sub-branch of Bank of 99 Changxin Road, Dafeng City, Yancheng 0515-83820100 29

Suzhou City Ganyu Sub-branch of Bank of 72-18 Huanghai Road, Ganyu County, 67 0518-86996117 Suzhou Lianyungang City Suqian Yanghe Sub-branch of Area 2, Block A1, Jiu Street,Jiujia Road, 68 0527-80668000 Bank of Suzhou Yanghe New Town, Suqian City

V. Remuneration Management

(I) Total amount of remuneration, beneficiary and compositional distribution of remuneration in

2012 The total amount of remuneration paid in 2012 amounted to RMB 460 million Yuan, for 2,046 beneficiaries. The remuneration comprises of two parts: basic wage and merit pay, accounting for 35% and 65% of total remuneration respectively.

(II) Standard of remuneration and achievement measurement and risk adjustment The merit pay for employees, which takes 65% of total remuneration, is linked to the actual achievements of employees, and is paid according to the practical accomplishment. The merit pay for employees on the posts with risk shall be subject to the deferred payment policy.

(III) Deferred payment of remuneration and non-cash remuneration The bank applies the deferred payment of remuneration system. The term of deferred payment is 3 years. The major senior management, medium-level cadres and employees on posts with risk shall apply the deferred payment in different proportion.

The total amount of deferred payment provision of our bank in 2012 was 41.64 million Yuan.

(IV) Detailed information of remuneration for board of directors, senior management and employees having significant impacts on the risk of bank

Pay Sheet 2012 of Directors, Senior Management and Employees with Significant Impacts on the Risk of Bank (Unit: 10,000 Yuan) After-tax Deferred Name Title remuneration in 2012 payment Wang Lanfeng Board Chairman 120.09 86.28 Xu Ting President, Director 111.30 86.28 Gu Nanxing Chief Supervisor 118.59 62.63 Gu Ping Vice President 97.86 56.69 Zhang Shuinan Vice President 107.87 65.60 Qian Feng Vice President 109.67 65.60 Hou Bin President Assistant 91.02 43.39 Pan Wenbing President Assistant 91.92 43.39 Zheng Wei President Assistant 97.75 49.78

Jiang Li BOD Secretary 62.23 23.34 General Manager of Sun Hongya Risk & Compliance 62.57 23.47 Dept. Planning & Finance Chen Jie Department 59.61 22.70 Controller General Manager of Song Zhaohui Credit Management 47.45 18.44 Dept. General Manager of Fang Min 54.62 20.21 Audit Dept.

Pay Sheet 2012 of Non-executive Directors and Independent Directors (Unit: 10,000 Yuan) Name Title Remuneration Yuan Weijing Shareholder Director 0 Zhou Wenqing Shareholder Director 0 Wen Zhenying Shareholder Director 0 Ge Xiangqian Shareholder Director 0 Gao Dekang Shareholder Director 0 Meng Weiyuan Shareholder Director 0 Yuan Xiaofeng Shareholder Director 0 Ye Xiaoming Shareholder Director 0 Lu Xingnan Shareholder Director 0 Ni Xiaochun Shareholder Director 0 Wang Ke Independent Director 6 Ling Xiaohua Independent Director 6 Yang Haikun Independent Director 6 (V) Formulation and Filing of Annual Remuneration Plan, Economic, Assessment of Risk and

Social Responsibility Index Completion The annual total amount of remuneration of the Company was withdrawn in accordance with The Resolutions of Bank of Suzhou Co., Ltd. Concerning Relevant Problems on Remuneration Management of Bank of Suzhou; the distribution plan for board of directors and senior management shall be approved by the board of directors prior to its implementation.

(VI) Exceptional Instances Exceeding the Original Remuneration Plan None.

Chapter V Company Management

I. Organizational Structure

II. Company Management Overview

During the reporting period, the Company has made continuous efforts to establish a highly efficient, transparent management mechanism and organizational structure, improve its system, enhance strategic management, implement internal control more extensively, carry out due diligence assessment on directors and senior officers and help directors and supervisors better understand the business condition of the Company through multiple channels such as internal investigation, etc., specifically:

1. During the reporting period, the Company has altogether organized and convened 49 meetings, including 2 general meetings, 10 board meetings, 25 meetings of the special committees of the board of directors, 7 supervisor meetings and 5 meetings of the special committees of the board of supervisors. At 32

these meetings, the Company reviewed and approved adjustments of special committees of board of directors, periodical company reports, working reports of board of directors, working reports of board of supervisors, working reports of the president of the bank, budget and final reports, profit distribution plans, significant related-party transaction, organizational structure, etc.

2. During the reporting period, the Company successfully adjusted the setup of the special committees of the board of directors, which laid a solid foundation for the building of a harmonious, highly effective, transparent board of directors to give full avail to the special committees.

3. The Company has constituted more than ten regulatory frameworks, e.g., Independent Director Work System, Suzhou Bank Operation and Management Information Reporting System, Measures for the Management of Information Disclosure, Guidelines on the Management of Dongwu Township and Rural Bank Provided by Suzhou Bank Co., Ltd., Measures for Investor Relationship Management, Measures for the Administration on Consolidated Financial Statements, Comprehensive Risk Management Guidance for Board of Directors for Year 2012, Measures for Capital Management, Capital Management Planning 2012-2014, Work System for Special Committees of Board of Directors of Suzhou Bank Co., Ltd., Comprehensive Risk Management Project Planning of Suzhou Bank, Risk Management Charter of Suzhou Bank Co., Ltd., etc. according to relevant regulatory requirements, through the constitution and revision of which, the management system of the Company has been further improved. Meanwhile, the board of directors and the board of supervisors make continuous effort to urge the implementation of the systems to promote the management level of the Company in the long run.

4. According to applicable stipulations, the Company has finished due diligence assessment on directors under the guidance of Due Diligence Committee to ensure they perform their duties and practice self-discipline.

5. During the reporting period, the Company has made the most of the public education platforms and training faculties by organizing directors and supervisors to attend respective trainings in turn and fulfilled the qualification training requirements on directors and supervisors so as to enhance their ability to perform their duties.

6. During the reporting period, the Company has focused on raising the management level of related party transactions, intra-company transactions in particular and greatly improved the management efficiency by further its system improvement, tougher implementation, creative control approaches on the basis of regulation compliant operation.

7. During the reporting period, the Board of Supervisors of the Company has followed the provisions set forth in the Contract Law of the People’s Republic of China and the Articles of Association as well as applicable regulatory policies to organize and convene supervisor meetings to review proposals on key issues, attend the board meetings and important operational meetings of senior management as nonvoting delegates, supervise and approve/disapprove on key issues such as lawful business operation, financial reports, internal control, etc., continually improve the board system, further advance the due diligence assessment on directors, supervisors and senior officials, evaluate the execution of strategy by the Board of Directors, carry out special examination and investigation on key items, perform duties earnestly and avail the supervisory role effectively to boost the regulated operation and sustainable growth of the Company.

8. During the reporting period, the Company has fully availed the role of the Board of Directors as a guide and manager of risks and has done a tremendous amount of work in aspects such as annual risk 33

guidelines, risk assessment and risk research, etc., thus generally enhancing the control and management of operational risks and advancing the building of a comprehensive risk management system; the introduction of super risk limits delivers the risk preferences and relevant concepts of the Board of Directors; Comprehensive Risk Management Guidance for Board of Directors for Year 2012 has brought forward specific guidelines for risk management, which incorporates policy guidance, management of credit risk, market risk, liquidity risk and information technology risk, etc.; the Board of Directors has implemented risk assessment to enhance its role of risk supervision and ensure that it has control over the Company’s risk related performance. Furthermore, intensive risk research and investigation have been carried out in an effort to provide reference for risk related decision making.

9. During the reporting period, the Company has made constant efforts to optimize and improve the internal control system according to the applicable laws and regulatory requirements such as Law of the People's Republic of China on Commercial Banks, Guidelines for Internal Control of Commercial Banks, etc. Through the implementation of relevant internal control system, new capital agreement as well as internal control measures such as supporting system optimization for middle-/back-stage management, the levels of scientific management and delicacy management have been significantly exalted; in addition, quantitative management of internal control over the operating units has been maintained through the internal control assessment system implemented throughout the organization so as to boost the operating units’ endogenous power for robust operation.

10. During the reporting period, the Board of Supervisors has unswervingly adhered to its supervisory duties and regulatory requirements, paid close attention to the operation and management conditions of the Company, organized special inspections on off-balance sheet business according to law and examined and rectified its performance of regulated operation. Besides, it has also formed research groups to carry out research and investigation on 4 rural and township banks and 2 joint-stock rural commercial banks and made pertinent advice to the Board of Directors and senior management based on the results of such investigation so as to promote the regulation compliant operation and robust development of the Company.

11. During the reporting period, the Secretary of the Board of Directors and the Board of Directors’ Office has created a platform for efficient and effective communication between the Board of Directors and the Board of Supervisors, senior management, directors and supervisors, etc. on company management information, approved proposals such as Measures for the Management of Information Disclosure and published Investor Relationship Bulletin, etc.

12. During the reporting period, the Company has disclosed key information in a timely, accurate, true and complete manner to improve the business transparency of the Company and ensure all the shareholders have equal access to the information of the Company. We’ve dedicated to the building of sound investor relationship through continuous improvement of the Company’s values with distinctive characteristics and advantages, creative thinking and clear focus to deliver the result of improvement during the process of reform and development.

III. Board of Directors

The Board of Directors is the independent decision making body of the Company. It executes the resolutions made at the general meetings, formulates key policies, guidelines and development plans of the Company, decides on the operation plans, investment plans and the setup of the organizational structure, prepares annual budgets and profit distribution plans and hires/dismisses senior management staff, etc. The 34

management has independent rights to make operational decisions and the Board of Directors does not intervene in the specific matters of daily operation and management.

(I) Composition of the Board of Directors As of the end of the reporting period, the Board of Directors consists of 16 members, including 3 internal directors and 13 external directors, including 3 independent directors. All external directors serve key positions in large-size renowned enterprises and have profound experience in management, banking and finance; 3 internal directors have long been engaged in bank operation and management and have rich professional experience; 3 independent directors are well-known experts in economy, finance, banking and law, etc.

Structurally, the Board of Directors of the Company features professionalism, independence and diversification to guarantee that the decisions made by the Board of Directors are scientific and reasonable.

To know more about the directors, please refer to the section About Directors, Supervisors, Senior Management and Employees hereunder. The directors do not have any personal relationship with each other, including financial, business, family or other key or relevant relationship. The identities of independent directors are clearly stated in the address book of the Company and fulfill all applicable regulations.

(II) Functionalities and Operation The Board of Directors may exercise the following functionalities and powers:

1. Convene general meetings and report its work to general meetings;

2. Execute resolutions made at general meetings;

3. Decide on the appointment of members and chairmen of special committees of Board of Directors based on the nomination by the Chairman of the Board and the remuneration committee;

4. Appoint and/or dismiss President and/or Secretary of the Board of Directors of the Company; appoint and/or dismiss Vice President, Assistant to President, person in charge of Planning and Finance Dept., Compliance Risk Dept., Audit Dept. and Credit Management Dept.;

5. Decide on the development strategy and internal setup of the management offices of the Company;

6. Prepare basic management systems such as risk management, internal control, internal audit, etc. and superintend the implementation thereof;

7. Decide on business plans, venture investment schemes, significant related-party transactions, asset-backed and other securities, stock management, etc.;

8. Review and approve various risk management policies and risk management reports of the Company and evaluate the effectiveness of the Company’s performance in risk management;

9. Prepare annual financial budget plans, final accounting plans, profit distribution plans and loss recovery plans of the Company;

10. Prepare plans for increasing or reducing registered capital of the Company or issuance of company bonds;

11. Propose at general meetings to appoint or replace the accounting firm that provides audit service to the Company;

12. Manage the matters relating to information disclosure of the Company;

13. Inspect the fulfillment of duties of senior management staff of the Company; heed the working reports of the President of the Company and check his/her work;

14. Review and approve proposals made by members of each committee;

15. Prepare plans relating to merger, division and dissolution or change of corporate form of the Company;

16. Be responsible for the management of investment abroad and subsidiaries of the Company;

17. Make proposals to amend the Articles of Association of the Company;

18. Evaluate and improve the Company’s management condition regularly;

19. Review the regulatory comments on commercial banks given by banking regulatory bodies and the rectification condition of commercial banks; and

20. Other functions and powers granted by laws, regulations, provisions of the Articles of Association and general meetings;

(III) Information of Board Meetings and Resolutions Made at Board Meetings During the reporting period, the Company standardized its procedures with the operating mechanism of the Board of Directors as the starting point and Suzhou Bank Co., Ltd. held 10 board meetings, focusing on the strengthening of the decision-making power of the Board of Directors and formed 61 resolutions on reform, development, how to overcome difficulties based on the whole picture of the situation, how to expand the market share, etc. The decision-making power of the Board of Directors has been fully availed.

1. The Fifteenth Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on Jan. 12, 2012 by correspondence voting. The meeting mainly reviewed and passed the proposal of 2011 Annual Incentive Plan for Middle and Senior Managers and the proposal of 2011 Annual Remuneration Distribution Plan for Senior Managers.

2. The Sixteenth Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on Feb. 17, 2012 in the conference room on 11F, Head Office of Suzhou Bank located at 143 North Dongwu Road, Suzhou. The meeting mainly reviewed and passed the proposals of 2011 Annual Work Report of Board of Directors, 2011 Annual Work Report of President of Bank, Implementation of 2011 Annual Financial Budgets, 2011 Annual Profit Distribution Plan, Preparation of 2012 Annual Financial Budgets, Proposal on the RMB Financial Bonds, Adjusting the Exposure Control Proportion of Banker's Acceptance Bill in Chairman’s Power of Attorney to Bank President, Proposal on Establishing Housing Provident Fund Financial Business Department, Proposal on Establishing Board of Directors' Office, Proposal on Renaming Capital Operation Department as Financial Marketing Department, Proposal on Setting up Operation Accounting Department and Planning and Finance Department, Proposal on Purchasing the Land for Building Suqian Management Head Office, Proposal on Granting New Loan Guarantee to Four Rural and Township Banks to Support the Agriculture Industry, Proposal on Independent Director Work System, Proposal on Nominating Comrade Yang Haikun as the Independent Director of Suzhou Bank Co., 36

Ltd., Proposal on Comrade Sun Zhonghao’s Resignation from the Post of Board Consultant of Suzhou Bank Co., Ltd., Proposal on Comrade Lin Gang’s Resignation from the Post of Deputy Director of Board Remuneration Committee Consultant of Suzhou Bank Co., Ltd., and Proposal on Convening the First General meeting in 2012.

3. The Seventeenth Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on March 1, 2012 in the conference room on 11F, Head Office of Suzhou Bank located at 143 North Dongwu Road, Suzhou. The meeting mainly reviewed and passed Proposal on Appointig Comrade Xu Ting as President of Suzhou Bank Co., Ltd., Proposal on nominating Comrade Xu Ting as Director of Suzhou Bank Co., Ltd., Proposal on Comrade Gu Nanxing’s Resignation from the Post of President of Suzhou Bank Co., Ltd. and Proposal on Comrade Gu Nanxing’s Resignation from the Post of Director of Suzhou Bank Co., Ltd.

4. The Eighteenth Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on March 22, 2012 (before the first general meeting) in Conference Room M1, 1F, Suzhou Dushu Lake Hotel. The meeting mainly reviewed and passed Proposal on Establishing Dongwu Branch Office, Proposal on Establishing Suqian Branch Office and Proposal on External Disclosure of Annual Audit Report.

5. The Nineteenth Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on Apr. 5, 2012 by correspondence voting. The meeting mainly reviewed and passed the proposal of Office Building Relocation.

6. The Twentieth Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on Apr. 23, 2012 by correspondence voting. The meeting mainly reviewed and passed the proposal of Report of 2011 Annual Information Disclosure.

7. The Twenty-first Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on Jun. 25, 2012 in the conference room on 22F, Head Office of Suzhou Bank located at 728 Zhongyuan Road, Suzhou Industrial Park. The meeting mainly reviewed and passed proposals of Purchase of Buildings for Business Operation by Directly Subordinated Offices in SIP, Suzhou Social Security / Citizen Card Multi-application Platform Project Implementation Program, Measures for the Management of Information Disclosure, Proposal on Establishing Changzhou Branch Office, Proposal on Establishing Nantong Branch Office, Proposal on Establishing Huai’an Branch Office, Proposal on Comrade Hua Fenjiu’s Resignation from the Post of Director of Suzhou Bank Co., Ltd., Proposal on Nominating Comrade Zhu Wenbiao as Director of Suzhou Bank Co., Ltd., Proposal on Nominating Comrade Song Zhaohui as General Manager of Credit Management Department of Suzhou Bank Co., Ltd. and Proposal on Appointing Comrade Chen Jie as General Manager of Planning and Finance Department of Suzhou Bank Co., Ltd.

8. The Twenty-second Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on August 23, 2012 in the conference room on 22F, Head Office of Suzhou Bank located at 728 Zhongyuan Road, Suzhou Industrial Park. The meeting mainly reviewed and passed proposals of Composition of Special Committees of the Board of Directors, Modification of Power of Attorney to President by Chairman, Guidelines on the Management of Dongwu Township and Rural Bank Provided by Suzhou Bank CO., Ltd., Measures for Investor Relationship Management, Measures for the Administration on Consolidated Financial Statements, Measures for Capital Management, Capital Management Planning 2012-2014, Proposal on Comrade Gu Linxiang’s Resignation from the Post of Board Consultant, Deputy Director and Membership of Relevant Committee of Suzhou Bank Co., Ltd., Proposal on Establishing

Qiandeng Branch Office, Proposal on Establishing Jinfeng Branch Office, Proposal on Establishing Meili Branch Office, Proposal on Establishing Shaxi Branch Office, Proposal on Establishing Shengze Branch Office, and proposal on Withdrawal of Share of RMB Six Hundred Thousand Yuan by Jiangsu Rural Credit Union.

9. The Twenty-third Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on November 15, 2012 in the conference room on 22F, Head Office of Suzhou Bank located at 728 Zhongyuan Road, Suzhou Industrial Park. The meeting mainly reviewed and passed proposals of Work System for Special Committees of Board of Directors of Suzhou Bank Co., Ltd. and Comprehensive Risk Management Project Planning of Suzhou Bank.

10. The Twenty-fourth Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. was convened on Nov. 15, 2012 by correspondence voting. The meeting mainly reviewed and passed Proposal of Suzhou Bank Co., Ltd. on Purchase of Buildings for Business Operation by Associating with Suzhou Local Financial Entities, Proposal of Suzhou Bank Co., Ltd. on Engaging Ernst & Young for Annual Audit, Proposal of Suzhou Bank Co., Ltd. Relating to Suzhou Bank Risk Charter (Draft) and Proposal on Relevant Issues Relating to Suzhou Bank Co., Ltd.’s Convening 2012 Extraordinary General Meeting.

The following list presents the attendance of directors at the Board meetings held in 2012. Directors Actual attendance / Number of meetings Wang Lanfeng 9/9 Xu Ting 2/2 Jiang Li 10/10 Yuan Weijing 9/10 Zhou Wenqing 10/10 Wen Zhenying 10/10 Ge Xiangqian 9/10 Gao Dekang 4/10 Meng Weiyuan 10/10 Yuan Xiaofeng 10/10 Ye Xiaoming 9/10 Lu Xingnan 9/10 Ni Xiaochun 9/10 Wang Ke 10/10 Ling Xiaohua 10/10 Yang Haikun 3/3 Note 1: Ms. Wang Lanfeng passed the qualification review by the regulatory department in January 2012 and now provides service to Suzhou Bank as Chairman of the Board and Director. Note 2: Mr. Xu Ting passed the qualification review by the regulatory department in September 2012 and now provides service to Suzhou Bank as Director and President of the bank. Note 3: Mr. Yang Haikun passed the qualification review by the regulatory department in August 2012 and now provides service to Suzhou Bank as Independent Director of the bank. (IV) Implementation of General Meeting Resolutions by Board of Directors

1. Director Attendance at General Meetings The following list presents the attendance of directors at the general meetings held in 2012.

Directors Actual attendance / Number of meetings Wang Lanfeng 2/2 Xu Ting 1/1 Jiang Li 2/2 Yuan Weijing 0/2 Zhou Wenqing 1/2 Wen Zhenying 2/2 Ge Xiangqian 2/2 Gao Dekang 0/2 Meng Weiyuan 1/2 Yuan Xiaofeng 2/2 Ye Xiaoming 1/2 Lu Xingnan 2/2 Ni Xiaochun 1/2 Wang Ke 2/2 Ling Xiaohua 2/2 Yang Haikun 0/1 Note 1: Ms. Wang Lanfeng passed the qualification review by the regulatory department in January 2012 and now provides service to Suzhou Bank as Chairman of the Board and Director. Note 2: Mr. Xu Ting passed the qualification review by the regulatory department in September 2012 and now provides service to Suzhou Bank as Director and President of the bank. Note 3: Mr. Yang Haikun passed the qualification review by the regulatory department in August 2012 and now provides service to Suzhou Bank as Independent Director of the bank.

(V) Fulfillment of Duties by Independent Non-executive Director Currently, there are 3 independent directors at the Board of Directors, the qualification, number and proportion of independent directors in compliance with relevant requirements set forth by China Banking Regulatory Commission. During the reporting period, they have communicated effectively with the Company through a variety of forms, including carrying out field investigation, case study and holding seminars, etc. They have attended the meetings of the Board of Directors and the special committees, expressed their opinions proactively at these meetings, and paid close attention to the interests of minority shareholders, fully availing the role as independent non-executive directors. 1. Independent Director Work System In order to give full play to independent directors and improve the effectiveness of the Board of Directors, the Independent Director Work System has been passed at the Sixteenth Meeting of the First Board of Directors of the Company, which requires that the minimum working time of independent directors shall be 15 working days at minimum. The Company has set up a special office and office equipment for independent directors and the directors are able to implement the work system according to rules. The main work scope of the independent directors covers: to study into the work of the relevant committee, investigate into and confirm the proposals made by the committees, heed the work reports of the management or the head office, discuss, formulate or amend the systems about company management, and so forth. The Independent Director Work System of the Company gives significant support and help for the independent directors to exert their expertise and provide professional advice to the Board for decision making.

In the meantime, during the preparation and disclosure process of the annual report 2012, the independent directors have observed the relevant systems and rules of the Company and the regulatory departments and have fulfilled their duties and obligations as independent directors diligently and earnestly, including heeding management’s report on the operation and significant matters of 2012, communicating with the CPA firm responsible for annual audit on a continual basis, heeding the report on the audit work plan, pre-audit and the audit results by the CPA firm and investigating the actual operation conditions of the Company.

2. Other Responsibilities of Independent Director Independent Director may express their independent opinions to the Board of Directors or General Meeting on the following matters:

(1) Nomination and/or dismissal of directors; (2) Appointment and/or dismissal of senior officers; (3) Remuneration of directors and senior officers; (4) Significant or especially significant connected transactions that take place between shareholders, actual controller or its affiliated enterprises and the Company as well as whether the Company takes effective measures to collect arrears back; (5) Other matters deemed by the independent directors that may jeopardize the interests of minority shareholders; (6) Other matters authorized by the Articles of Association.

Independent directors of the Company also play active roles in the special committees. Nominated by the Board, they are also chairmen of remuneration committee, audit committee and connected transaction control committee.

4. Attendance of Independent Directors at Different Meetings: During the reporting period, all the independent directors have fulfilled their duties and obligations as independent directors diligently and taken active part in all kinds of meetings arranged by the Board of Directors.

Attendance of Independent Directors at Board Meetings in 2012

Actual number Attendance Attendance by Director Remarks of meetings in person delegate

Wang Ke 10 10 0 Ling Xiaohua 10 10 0

Mr. Yang Haikun passed the qualification review by the regulatory department in August 2012 and now Yang Haikun 3 3 0 provides service to Suzhou Bank as Independent Director of the bank.

(VI) Confirmation on the Independence of Independent Directors There are no factors that put the independence of all three independent directors in question; therefore, the Company believes that all three independent directors are independent.

(VII) Chairman of Board and President of Bank The roles and functions of the Chairman of the Board and the President of Bank are assumed by different people with clearly defined and demarcated responsibilities. Ms. Wang Lanfeng is the Chairman of the Board to lead the Board of Directors and chair the meetings to ensure all directors at Board meetings are informed of the matters being discussed, manage the operation of the Board of Directors and make sure the Board of Directors can discuss all significant and relevant matters in a timely and effective manner. In order to do that, the Chairman of the Board will cooperate with relevant senior officers to ensure directors receive appropriate, complete and reliable information for their consideration and review.

Mr. Xu Ting, President of Bank, is responsible for the business operation and the implementation of the strategies and business plans of the Company.

IV. Board of Directors Special Committee

The work scope of the Board of Directors in 2012 mainly included: constitution and amendment of several management systems of the Company, including Independent Director Work System, Suzhou Bank Operation and Management Information Reporting System, Measures for the Management of Information Disclosure, Guidelines on the Management of Dongwu Township and Rural Bank Provided by Suzhou Bank CO., Ltd., Measures for Investor Relationship Management, Measures for the Administration on Consolidated Financial Statements, Comprehensive Risk Management Guidance for Board of Directors for Year 2012, Measures for Capital Management, Capital Management Planning 2012-2014, Work System for Special Committees of Board of Directors of Suzhou Bank Co., Ltd., Comprehensive Risk Management Project Planning of Suzhou Bank, Risk Management Charter of Suzhou Bank Co., Ltd., etc.

There are six Directors who are also members of the special committees. Their authorities and work scope in 2012 are as follows:

(I) Strategic Development and Investment Management Committee

1. Composition of Strategic Development and Investment Management Committee and Meetings in

2012 There are 5 members in the Strategic Development and Investment Management Committee of the Board of Directors, namely, Wang Lanfeng, the Chairman, Xu Ting, Wang Ke, Yuan Weijing and Gao Dekang.

According to the proposal on Composition of Special Committees of the Board of Directors made at the Twenty-second Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. convened on August 23, 2012, the Strategic Development and Investment Management Committee of the Board of Directors has been set up, including 5 members, namely, Wang Lanfeng, the Chairman, Xu Ting, Wang Ke, Yuan Weijing and Gao Dekang.

In 2012, the Strategic Development and Investment Management Committee held 1 meeting, reviewed 2 issues and heeded 1 report. Refer to the following table for the attendance data: Name Actual attendance / Number of meetings Wang Lanfeng 1/1 Xu Ting 1/1 41

Wang Ke 1/1 Yuan Weijing 1/1 Gao Dekang 0/1

2. Main Tasks of Strategic Development and Investment Management Committee in 2012:

The Strategic Development and Investment Management Committee has combed and developed the structure to manage the Company, i.e., the “three meetings and one level” structure to thoroughly fulfill the duties of the Strategic Development and Investment Management Committee under the leadership of the Board of Directors as well as guided by the Chairman of Board’s spirit of strategic transformation and attention to details.

Earnestly perform the duties of the Strategic Development and Investment Management Committee on a daily basis. In 2012, the Strategic Development and Investment Management Committee held 1 meeting to discuss important issues that need to make decisions, enhance researches and field investigations to provide reference for the directors to make decisions.

In the meantime, the Strategic Development and Investment Management Committee has carefully scrutinized each and every business in relation with shareholders and/or shares, in strict compliance with relevant requirements, rules and regulations. During the reporting period, it voted by communication on 11 stock pledges, 2 stock reports and 4 changes of shareholder information.

(II) Nomination and Remuneration Committee

1. Composition of Nomination and Remuneration Committee and Meetings in 2012

According to the proposal of Composition of Special Committees of the Board of Directors made at the Twenty-second Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. on August 23, 2012, the Nomination Committee and the Remuneration Committee were merged to the Nomination and Remuneration Committee.

In 2012, the Nomination Committee held 3 meetings and reviewed 5 issues. Refer to the following table for the attendance data: Name Actual attendance / Number of meetings Wang Ke 3/3 Fan Liheng 3/3 Jiang Li 3/3 Note: The Nomination Committee and the Remuneration Committee were merged to the Nomination and Remuneration Committee according to the proposal made at the Twenty-second Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. on August 23, 2012. Stated is the attendance data before the change.

In 2012, the Remuneration Committee held 2 meetings, reviewed 2 issues and heeded 1 report. Refer to the following table for the attendance data: Name Actual attendance / Number of meetings Zhu Lihua 2/2 Hua Fenjiu 2/2 Fan Liheng 2/2 42

Yuan Weijing 2/2 Ge Xiangqian 2/2 Note: The Nomination Committee and the Remuneration Committee were merged to the Nomination and Remuneration Committee according to the proposal made at the Twenty-second Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. on August 23, 2012. Stated is the attendance data before the change.

The Nomination Committee and the Remuneration Committee were merged to the Nomination and Remuneration Committee according to the proposal of Composition of Special Committees of the Board of Directors made at the Twenty-second Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. on August 23, 2012. There are 5 members, including Ling Xiaohua, Chairman of the Committee, Yuan Weijing, Ge Xiangqian , Zhu Wenbiao and Jiang Li.

In 2012, the Nomination and Remuneration Committee held 1 meeting, reviewed 1 issue and heeded 1 report. Refer to the following table for the attendance data: Name Actual attendance / Number of meetings Ling Xiaohua 1/1 Yuan Weijing 1/1 Ge Xiangqian 1/1 Zhu Wenbiao 1/1 Jiang Li 1/1 Note: The Nomination Committee and the Remuneration Committee were merged to the Nomination and Remuneration Committee according to the proposal made at the Twenty-second Meeting of the First Board of Directors of Suzhou Bank Co., Ltd. on August 23, 2012.

2. Nomination Procedure and Handling Process Adopted by the Nomination and Remuneration

Committee

(1) Candidate director nomination ① General nomination procedure

A director is elected as follows: Based on the shareholders’ opinion, the Board of Directors will make written proposal to the general meeting and include in the proposal the curriculum vitae and basic data of the candidates according to the relevant provisions in the Articles of Association. The Nomination Committee and the Remuneration Committee will ask for the shareholders’ opinions and collect the nomination proposals and review the candidates’ qualification according to the Company Law, Commercial Bank Law, other laws and statues, regulatory provisions, department rules, etc. and report to the Board of Directors for review. The Board of Directors will submit the proposal to the general meeting for voting. However, the consent of the candidate him/herself must be obtained before the nomination is made. If any shareholder or the Board of Supervisors has any dissention with the candidate list, it shall be entitled to make new proposal according to the relevant provisions in the Articles of Association, whose qualification shall be reviewed by the Nomination and Remuneration Committee and be submitted to the general meeting for approval at the discretion of the Board of Directors.

② Special nomination procedure for candidate independent directors

According to the provisions of relevant laws, rules and the Articles of Association, any shareholder that holds 1% or more of the Company’s issued stocks, independently or jointly, the Board of Directors and 43

the Board of Supervisors may nominate candidate independent directors, which shall be voted at the general meeting. The nominator shall fully understand the nominee’s occupation, education background, title, detailed work experience, part-time experience, if any, and comment on his/her qualification and independence as an independent director. The nominee shall make a public statement that there is not any personal relationship between him/her and the Company that may affect its independent and objective judgment. The nominee shall meet the basic conditions specified in the Articles of Association and the independence requirement. Before the convening of the general meeting to elect independent directors, the Board of Directors shall disclose the above information according to applicable rules.

Before the convening of the general meeting to elect independent directors, the Company shall submit the relevant materials of all nominees to the relevant regulatory departments. In case the Board of Directors disagrees with the condition of any nominee, a written comment shall be provided in the meantime.

(2) Rules and Standards for Selecting and Recommending Candidate Directors

The director shall have essential professional know-how and work experience for performing his/her duties, meet the provisions of CBRC. His/her qualification must be reviewed and approved by CBRC.

Independent directors shall meet the following essentials:

① Having university or higher degree or senior or higher title of relevant majors;

② Having 5 years or more experience in legal affairs, economy, finance, banking or any other experience that facilitates the performance of the duties of an independent director;

③ Familiarized with the laws and regulations in relation with the operation and management of commercial banks;

④ Able to read, understand and analyze the credit statistics and financial statements;

⑤ Other conditions specified by the laws, regulations and the Articles of Association of the Company.

3. Work Done by the Nomination and Remuneration Committee in 2012 In 2012, the Nomination and Remuneration Committee proactively performed its duties and functions specified in the Nomination and Remuneration Committee Work System and gave full play to their specialized roles in selecting directors and senior officers to build a solid foundation for the Company’s long-term sustainable development; it also reviewed the annual remuneration of directors and senior officers and organized and carried out the assessment of the performance of directors and senior officers in an effort to improve the Company’s remuneration competitiveness; generally, it fulfilled the work plans of 2012 successfully.

In 2012, Mr. Yang Haikun was nominated candidate independent director at the Sixteenth Meeting of the First Board of Director, got elected at the first general meeting in 2012 and took office after required procedures to file and report to the regulatory department were finished. Mr. Xu Ting was nominated candidate director at the Seventeenth Meeting of the First Board of Director, got elected at the first general meeting in 2012 and took office after required procedures to file and report to the regulatory department were finished. Mr. Zhu Wenbiao was nominated candidate director at the Seventeenth Meeting of the First Board of Director, got elected at the first extraordinary general meeting convened on December 14, 2012 44

and would take office upon the approval of the regulatory department on this relevant qualifications. Ms. Zhuang Yumin resigned office as director due to work related reasons and her resignation was passed at the first general meeting in 2012. Mr. Hua Fenjiu resigned office as director due to his age and his resignation was passed at the first extraordinary general meeting in 2012.

(III) Information Technology Management Committee

1. Composition of Information Technology Management Committee and Meetings in 2012

The duties and functions of Information Technology Management Committee mainly include:

(1) Define the strategic objective of IT development for the entire bank, provide guidance on the capital investment in IT development and review and approve on IT related planning;

(2) Make reasonable use of the existing resources, guide the IT department to provide high quality IT service and monitor the cost management of IT development;

(3) Prioritize the IT projects and activities and solve conflicts in resource occupation reasonably;

(4) Ensure the IT strategy is updated timely;

(5) Review and approve major IT related policies, standards and rules;

(6) Monitor important IT projects and activities;

(7) Monitor and manage IT performance and ensure the anticipated IT service level is reached; and

(8) Review and approve key IT projects.

(9) Report to Board of Directors on the implementation of IT strategic planning, IT related budget and actual expenditure, overall condition, major risks and countermeasures in relation with IT, etc.

In 2012, the Information Technology Management Committee held 1 meeting, reviewed 1 issue and heeded 2 reports.

Refer to the following table for the attendance data: Name Actual attendance / Number of meetings

Xu Ting 1/1 Yuan Xiaofeng 1/1 Lu Xingnan 1/1 Ni Xiaochun 1/1 Zhu Wenbiao 1/1 Note: The Information Technology Management Committee was set up according to the proposal made at the Twenty-second Meeting of the First Board of Directors on August 23, 2012.

2. Work Done by the Information Technology Management Committee in 2012 45

In 2012, the Information Technology Management Committee finished its planned tasks under the guidance of the Board of Directors based on the IT development plans and the work objectives. It guided the relevant departments to complete and improve the existing system, took protective measures against IT related risks, enhanced the building of a functional IT team to ensure the normal stable operation of the systems of each relevant department and completed the establishment and relocation of the data center.

(1) Guided relevant business departments to complete development assignments smoothly;

(2) Urged the stable operation of the systems of business departments;

(3) Focused on information security and improved the internal control measures;

(4) Demanded business departments to enhance the channel and infrastructure construction.

(IV) Risk Management Committee

1. Composition of Information Technology Management Committee and Meetings in 2012 There’re 7 members in the Risk Management Committee, including Wang Lanfeng, the Chairman, Xu Ting, the Vice Chairman, Ling Xiaohua, Yang Haikun, Zhou Wenqing, Ye Xiaoming and Gao Dekang.

The duties and functions of the Risk Management Committee mainly include:

(1) Formulate or review the overall risk management and internal control compliance policies and frameworks and submit to the Board of Directors for review;

(2) Superintend the senior management’s performance on the control of risks such as capital and credit risk, liquidity risk, market risk, operational risk, compliance risk and reputational risk, etc.

(3) Assess the Company's risk policy management status and risk tolerance regularly and irregularly as well as the effectiveness of the Company’s risk and compliance management;

(4) Review the Company's risk and internal control related management reports; make proposals on the improvement of risk management and internal control;

(5) Research the material risks in the Company’s operation and management;

(6) Review and approve on risks of large-sum credit, investment, risk classification of assets, etc. within the authority of the Board of Directors;

(7) Other matters authorized by the Board of Directors.

In 2012, the Risk Management Committee held 5 meetings, reviewed 13 issues and heeded 1 report on risk management. Refer to the following table for the attendance data: Name Actual attendance / Number of meetings Ye Xiaoming 4/4 Sun Hongya 4/4 Yang Liying 4/4 Note: The composition of the Risk Management Committee was set up according to the proposal made at the Twenty-second Meeting of the First Board of Directors on August 23, 2012. Stated is the attendance data before the 46

change.

Name Actual attendance / Number of meetings Wang Lanfeng 1/1 Xu Ting 1/1 Ling Xiaohua 1/1 Yang Haikun 1/1 Zhou Wenqing 1/1 Ye Xiaoming 1/1 Gao Dekang 0/1 Note: The composition of the Risk Management Committee was set up according to the proposal made at the Twenty-second Meeting of the First Board of Directors on August 23, 2012. 2. Major Work Done by Risk Management Committee in 2012 In 2012, the Risk Management Committee proactively performed its risk management duties and functions and further improved the rationality and effectiveness of the Company’s risk management related decision making, specifically,

In 2012, the Risk Management Committee reviewed and approved 2011 Evaluation Report on the Effectiveness of Suzhou Bank’s Risk Management, Risk Management Related Matters in 2011 Annual Report Disclosure, Risk Report Q1 2012, 2012 Comprehensive Risk Management Policies of the Board of Directors on Suzhou Bank, Risk Committee’s Reports to the Board of Directors on the Progress of Comprehensive Risk Management System, Suzhou Bank Capital Management Plan 2012-2014, Suzhou Bank's Capital Management Approach (Draft), Suzhou Bank Comprehensive Risk Management Project Planning, Work System of Risk Management Committee of Board of Directors Suzhou Bank, Suzhou Bank Risk Warning Assessment Q3 2012, Suzhou Bank Risk Report Q3 2012, Suzhou Bank Q3 2012 Compliance Report and Suzhou Bank Credit Facility Statement Over Bank President’s Authority in 2012, etc.

(V) Audit Committee 1. Composition of Audit Committee and Meetings in 2012 As of the end of the reporting period, the Audit Committee consists of 5 members, including 2 independent directors and 2 external directors. Both independent directors are experts in the fields of economy and finance; both external directors serve key positions in the shareholding companies and have profound experience in management, banking and finance. The committee members include Ling Xiaohua, the Chairman, Wang Ke, Zhou Wenqing , Wen Zhenying and Zhu Wenbiao.

The Audit Committee of the Company is reasonably structured, professional and independent so that it has the ability to avail its supervisory functions effectively. There is not any personal relationship between members of the committee, whether financial, business, family or any other major or similar relationship. In 2012, the Board of Directors Audit Committee held 4 meetings, reviewed 10 issues, heeded 4 reports and discussed 3 proposals.

Refer to the following table for the attendance data: Name Actual attendance / Number of meetings Ling Xiaohua 3/3 Pan Wenbing 3/3 Fang Min 3/3 Zhu Jun 3/3 Jiang Jinghua 3/3 Note: The composition of the Audit Committee was set up according to the proposal made at the Twenty-second Meeting of the First Board of Directors on August 23, 2012. Stated is the attendance data before the change.

2. Work Done by Audit Committee in 2012 (1) Reviewed the Company’s financial reports, organized special audits on the Company’s financial disclosure of 2011.

(2) Organized the assessment of the fulfillment of duties of the Company’s audit department in 2011.

(3) Organized the comprehensive audit of the business operation and management activities of Siyang Dongwu Rural and Township Bank from its opening to the end of May 2012.

(VI) Connected Transaction Control Committee 1. Composition of the Connected Transaction Control Committee and Meetings Held in 2012 There are 5 members in the Connected Transaction Control Committee of the Board of Directors, including Wang Ke, the Chairman, Yang Haikun, Ge Xiangqian, Meng Weiyuan and Jiang Li.

As of the end of the reporting period, the Connected Transaction Control Committee consists of 5 members, including 2 independent directors, 2 external directors and 1 internal director. Both independent directors are experts in the fields of economy and legal affairs; both external directors serve key positions in the shareholding companies and have profound experience in management, banking and finance.

The Connected Transaction Control Committee of the Company is reasonably structured, professional and independent so that it has the ability to avail its supervisory functions effectively. There is not any personal relationship between members of the committee, whether financial, business, family or any other major or similar relationship. In 2012, the Connected Transaction Control Committee held 2 meetings and

reviewed 2 issues.

Refer to the following table for the attendance data: Name Actual attendance / Number of meetings Ling Xiaohua 1/1 Gu Linxiang 1/1 Yang Liying 1/1 Sun Hongya 1/1 Jiang Jinghua 1/1 Note: The composition of the Connected Transaction Control Committee was set up according to the proposal made at the Twenty-second Meeting of the First Board of Directors on August 23, 2012. Stated is the attendance data before the change.

According to the proposal on Composition of Special Committees of the Board of Directors made at the Twenty-second Meeting of the First Board of Directors convened on August 23, 2012, the composition of the Connected Transaction Control Committee of the Board of Directors has been changed to 5 members, including Wang Ke, the Chairman, Yang Haikun, Ge Xiangqian, Meng Weiyuan and Jiang Li. Name Actual attendance / Number of meetings Wang Ke 1/1 Yang Haikun 1/1 Ge Xiangqian 1/1 Meng Weiyuan 1/1 Jiang Li 1/1 Note: The composition of the Connected Transaction Control Committee was set up according to the proposal made at the Twenty-second Meeting of the First Board of Directors on August 23, 2012. 2. Major Work Done by the Connected Transaction Control Committee in 2012 In 2012, the Connected Transaction Control Committee continued to follow the “Open and Transparent” guideline set forth by the Board of Directors and performed their duties and functions earnestly by adhering to compliance development, focusing on the improvement of management efficiency toward the major objective of regulated development and conforming disclosure. In 2012, the Connected Transaction Control Committee passed the Work System of Risk Management Committee of Board of Directors Suzhou Bank by voting at the meeting to better regulate the Committee's work.

The Connected Transaction Control Committee operates professionally and independently and reviews strictly on connected transactions in accordance with the guidelines of “controllable risk, fair trade, legal compliance” and provides scientific reference to the Board of Directors for them to make decision on key connected transactions to ensure that the connected transactions are carried out accordance with "fair, just, open" business principles and in the interests of all shareholders.

V. Board of Supervisors

The Board of Directors is the supervisory body of the Company and exercises the functions according to the Company Law of the People’s Republic of China and other laws, regulatory rules and the Articles of association to promote the compliance operation, robust development of the Company, safeguard the interest of the Company and the shareholders. It reports to the general meetings.

(I) Composition of Board of Supervisors As of the end of this reporting period, there are 9 members in the Board of Supervisors, including 7 shareholder supervisors and 2 employee supervisors. All shareholder supervisors are assigned by the shareholding companies that have profound experience in management, banking and finance; both employee supervisors have long been engaged in bank operation and management and have rich professional experience

The Board of Supervisors is reasonably structured, professional and independent so that it has the ability to avail its supervisory functions effectively.

To know more about the Supervisors, please refer to the section About Directors, Supervisors, Senior Management and Employees hereunder. The directors do not have any personal interest with each other, including financial, business, family or other key or relevant relationship.

(II) Functions of Board of Supervisors The Board of Directors is the supervisory body of the Company. It reports to the general meetings. It may avail the following functions and authorities according to the rules and stipulations set forth in the Company Law and the Articles of Association:

1. Review the financial performance of the Company;

2. Superintend the business related behaviors of the directors and senior officers and make proposals on the dismissal of directors and senior officers that violate any rules or stipulations set forth in the applicable laws, regulatory rules, the Articles of Association or the general meeting resolutions;

3. Demand the directors and senior officers when their behaviors jeopardize the interests of the Company;

4. Propose for the convening of extraordinary general meetings and call for and chair general meetings when the Board of Directors fail to perform the duties to call for and chair the general meetings as required by applicable laws;

5. Make proposals to general meetings;

6. Lodge a lawsuit against any director or senior officer;

7. Supervisors may attend the Board meetings as non-voting member and may ask questions and make suggestions on the resolutions to be made by the Board of Directors; in discovery of any abnormal operation, supervisors may investigate and engage a CPA firm to assist in their work on the Company’s account, when necessary;

8. Other authorities granted by the Articles of Association.

(III) Meetings and Resolutions of the Board of Supervisors During the reporting period, the Board of Supervisors held 7 meetings, specifically:

In 2012, the Board of Supervisors held 7 meetings, with the content and resolutions made at each meeting in compliance with the provisions set forth in the Company Law, Articles of Association and the Rules of Procedures of the Board of Supervisors. The meetings mainly covered the following contents:

1. The Seventh Meeting of the First Board of Supervisors was held on February 24, 2012. The meeting reviewed and passed Work Report of the Board of Supervisors 2011, Assessment Report on the Due Diligence of Directors, Supervisors and Senior Management 2011 and Work Plans of Audit Committee of the Board of Supervisors 2012, and heeded Research Report on Shareholding Banks and Controlling Rural and Township Banks.

2. The Eighth Meeting of the First Board of Supervisors was held on March 1, 2012. The meeting reviewed and passed Proposal on Comrade Shang Ronggen’s Resignation from Office as Chairman of the Board of Supervisors, Proposal on Comrade Shang Ronggen’s Resignation from Office as Member of the Board of Supervisors, and Proposal on Nominating Comrade Gu Nanxing as Member of the Board of Supervisors.

3. The Ninth Meeting of the First Board of Supervisors was held on March 22, 2012. The meeting reviewed and passed Proposal on Electing Comrade Gu Nanxing as Member of the Board of Supervisors.

4. The Tenth Meeting of the First Board of Supervisors was held on April 28, 2012. The meeting reviewed and passed Proposal on Passing Information Disclosure Report 2011.

5. The Eleventh Meeting of the First Board of Supervisors was held on June 25, 2012. The meeting heeded Business Operation Status Analysis Report Q1 2012, Work Plan on Audit and Inspection of Four Dongwu Rural and Township Banks by the Board of Supervisors and reviewed and passed the Proposal on 2012 Work Plan of the Board of Supervisors.

6. The Twelfth Meeting of the First Board of Supervisors was held on August 23, 2012. The meeting heeded Business Operation Status Analysis Report Q2 2012.

7. The Thirteenth Meeting of the First Board of Supervisors was held on November 15, 2012. The meeting heeded Business Operation Status Analysis Report Q3 2012, reviewed and passed Proposal on Adjusting the Composition of Nomination Committee and Audit Committee of the Board of Supervisors, Proposal on Merging Due Diligence Committee of the Board of Supervisors, Proposal on Amending the Implemental Rules of Audit Committee and Nomination Committee of the Board of Supervisors, Directors Due Diligence Assessment Approach (Preliminary), Directors, Supervisors and Senior Management Due Diligence Assessment Approach by the Board of Supervisors and Proposal on Engaging Ernst & Young for Annual Audit.

(IV) Attendance of Supervisors at the Meetings held by the Board of Supervisors in 2012 Supervisor Actual attendance / Number of meetings Gu Nanxing 4/4 Zhu Zhenming 7/7 Pan Yong 5/7 Kong Li 7/7 Shen Zhe 7/7 Cao Haiyan 7/7 Xu Caiying 7/7 Shen Hongmei 7/7 Jin Yugen 7/7

VI. Special Committees of Board of Supervisors There are Audit Committee and Nomination Committee under the Board of Supervisors. Refer to the following table for information about its composition, authorities and the work done in 2012. Subordinated to (Board of No. Committee Members Supervisors) Cao Haiyan, Gu Nanxing, 1 Audit Committee Board of Supervisors Zhu Zhenming Kong Li, Gu Nanxing, Zhu 2 Nomination Committee Board of Supervisors Zhenming (I) Composition of Audit Committee and Work Done in 2012 1. There are 3 members in the Audit Committee, including Cao Haiyan, the Chairwoman, Gu Nanxing and Zhu Zhenming.

2. Audit Committee is a special office set up by the Board of Supervisors in accordance with the general meeting resolution, which is responsible for making specific plans for the Board of Supervisors to exercise their supervisory functions and authorities over the Board of Directors and the senior management as well as the communication, supervision and examination of matters in relation with the Company’s the internal and external audits.

In 2012, the Committee held 2 meetings and reviewed 5 issues. Refer to the following table for the attendance data:

Member of committee Actual attendance / Number of meetings

Cao Haiyan 2/2 Shang Ronggen/ Gu Nanxing 2/2 Zhu Zhenming 2/2

The first meeting of the Audit Committee held on Feb. 24, 2012 reviewed and passed the 2012 Work Plan of Audit Committee of the Board of Supervisors; the second meeting of the Audit Committee held on Nov. 15, 2012 reviewed and passed Proposal on Proposal on Amending the Implemental Rules of Audit Committee of the Board of Supervisors, Directors Due Diligence Assessment Approach (Preliminary), Directors, Supervisors and Senior Management Due Diligence Assessment Approach by the Board of Supervisors and Proposal on Engaging Ernst & Young for Annual Audit.

In 2012, the Audit Committee proactively performed its duties and functions set forth in the Articles of Association and Implemental Rules of Audit Committee of the Board of Supervisors of Suzhou Bank Co., Ltd. according to its work plan, completed its tasks and fulfilled its duties and functions generally.

(II) Composition of Nomination Committee and Work Done in 2012 1. There are 3 members in the Nomination Committee, including Kong Li, the Chairwoman, Gu Nanxing and Zhu Zhenming.

2. The Nomination Committee is a special office set up by the Board of Supervisors in accordance with the general meeting resolution, which is responsible for formulating procedures and standards for selecting and appointing supervisors, reviewing the qualifications and other conditions of supervisors and making advice to the Board of Supervisors. The employee supervisors are selected or dismissed

by the employees of the Company through voting.

In 2012, the Committee held 3 meetings and reviewed 4 issues. Refer to the following table for the attendance data: Member of committee Actual attendance / Number of meetings

Kong Li 3/3 Shang Ronggen/ Gu Nanxing 3/3 Zhu Zhenming 3/3

The first meeting of the Nomination Committee held on March 1, 2012 nominated Comrade Gu Nanxing as the Supervisor of Suzhou Bank; the second meeting of the Audit Committee held on Mar. 22, 2012 nominated Comrade Gu Nanxing as the Chairman of the Board of Supervisor of Suzhou Bank; the third meeting of the Audit Committee held on Nov. 15, 2012 reviewed and passed Proposal on Adjusting the Composition of the Nomination Committee and the Audit Committee and reviewed the Proposal on Amending the Implemental Rules of Nomination Committee of the Board of Supervisors.

In 2012, the Nomination Committee proactively performed its duties and functions set forth in the Articles of Association and Implemental Rules of Nomination Committee of the Board of Supervisors of Suzhou Bank Co., Ltd. according to its work plan, completed its tasks and fulfilled its duties and functions generally.

VII. Decision-making System of the Company

The highest authority of the Company is the general meeting, which manages and supervises the Company via the Board of Directors and the Board of Supervisors. The Bank President is appointed by the Board of Directors to be fully responsible for the daily operation and management of the Company. The company implements a first-grade corporation system. All its branches are non-independent accounting units whose operation and management activities must be carried out upon the approval of the Head Office and are responsible for the Head Office.

The Company has no controlling shareholder. The Company and major shareholders are completely independent in business, personnel, asset, office and finance. The Company has independent and complete capabilities of business transaction and operations management and the Board of Directors, the Board of Supervisors and the internal offices can operate independently.

VIII. Appraisal and Incentive Mechanism and Policies and Remuneration Strategies for Senior Managers

According to relevant provisions, the remuneration of senior managers is linked to the fulfillment of the key performance indicators. In 2012, the Nomination and Remuneration Committee of the Board of Directors set the targets of key performance indicators in combination with 2012 Annual Financial Budget Preparation so that the Board of Directors will appraise the senior managers based on the key performance indicators and determine their annual merit pay. According to regulatory requirements, the Company has established a senior management risk fund, which is withdrawn from the annual merit pay payable to the senior management at a certain percentage.

The Company's senior management remuneration strategy is intended to support the Company's development strategy and ensure the achievement of the business objectives of the Company; it reflects the Company’s human resource policies and guidelines, attaches a lot of importance to value creation oriented performance and motivates senior managers to grow together with Suzhou Bank; it is aimed to establish a fair, consistent, rational and competitive remuneration programs; it establishes an incentive and restriction mechanism for senior management based on clearly defined duties and functions, performance evaluation process and functional performance management system; the remuneration is paid based on the positions and responsibilities of the person, his/her competence and his/her contribution to the achievement of operation results.

IX. Appointment of Accounting Firm

According to the resolution made at the First Extraordinary General Meeting of the Company in 2012, it has hired Ernst & Young to audit the Company's annual financial statements in 2012 at the cost of RMB 900,000 Yuan.

X. Internal Control and Internal Audit

(I) Explanation of the Rationality, Validity and Integrity of Internal control system

1. Organizational Structure of Internal Control The Company has established an independent organizational structure for internal control. The General Meeting, the Board of Directors and the Board of Supervisors play their respective roles under the leadership of the Board of Directors. The General Meeting is the highest authority of the Company, the Board of Directors is the company's decision-making body and the Board of Supervisors is the Company's supervisory body. The Board of Directors consists of six special committees, namely, the Strategic Development and Investment Management Committee, the Audit Committee, the Risk Committee, the Nomination and Remuneration Committee and the Connected Transactions Control and Information Technology Management Committee, which are offices that research and provide reference for the Board of Directors to make decisions. The Bank Presidents and senior managers are responsible for commanding, coordinating, managing and superintending the daily business activities of the Company in accordance with the decisions of the Board of Directors.

The internal control system of the Company functions effectively under a sound structure. The Board of Directors of the Company is responsible for establishing, improving and effectively implementing the internal control system, the Audit Committee of the Board of Directors is responsible for supervising and guiding the building of the internal control system through reviewing the internal control related work reports regularly and organizing relevant research and self-assessment; the Risk Management Committee of the Board of Directors monitors the status of management risks through developing annual guidance on risks, regular risk assessment and auditing risk reports. The Board of Directors gets complete hold of the internal control status, research issues that are relevant to decision making and make constructive proposals to the management based on the research work conducted by the Audit Committee and the Risk Management Committee of the Board of Directors. The management implements the opinions and work plans of the Board of Directors about internal control and management to comprehensively strengthen the risk management and continuously improve the enforcement and the authority of the internal control

system to achieve scientific, standard, regular procedures of internal control and management. The Board of Supervisors monitors in accordance with the Company Law, relevant regulatory requirements and the Articles of Association to ensure that the Board of Directors, senior management and senior managers perform their duties in compliance with applicable laws and it is responsible for the general meeting to promote the compliance operation and steady development of the Company. The Company has formed an effective internal control and management system through combining education, pre-alarm, prevention, reward and penalty with clearly defined responsibilities to make sure each department cooperates with and monitors one another.

2. Internal Control System Under the guidelines of risk prevention and prudent operation, the Company has gradually established a relatively scientific and rigorous internal control system and a series supporting rules and regulations to prevent, control, superintend and correct to ensure that the management is strictly carried out and the risks are controllable through continuously combing and improving the internal control system in accordance with the Law of the People's Republic of China on Commercial Banks, Guidelines for Internal Control of Commercial Banks, etc. and other legal and regulatory requirements.

The Company's internal control system includes: company management related systems with the Articles of Association, the general meeting, the Board of Directors and its special committees as well as the rules of procedures of the Board of Supervisors at the core; operation system consisting of business rules of the management; management system consisting of rules in relation with accounting management, account settlement, financial management, information technology, computer system risk control, corporate culture building, office setup and definition of functions, tenure of employment, job qualifications, compulsory leaves, authority management, stamp management, guards and securities, institutions, rewards and punishments, supervision and inspection, etc.; information control system with the Information Disclosure Management System at the core. The current system has fundamentally penetrated into all the existing management departments, business offices and various business and transactional processes and the sound institutional system provides a solid guarantee for effective prevention of financial risks.

3. Major Internal Control Measures The Company continues its effort to strengthen the corporate governance construction, improve the “three-meeting one-layer” of the Board of Directors and the regular communication and decision-making balance mechanism of the special committees, enhances the authorized management of various businesses, and adopts authority classifications and oversight mechanism based on different responsibilities and authorities, improves various aspects of business processes and internal control measures to tighten the business authorization, approval procedures and approval authorities and build an internal control mechanism with rational division of labor between different positions and departments, clearly defined duties and authorities, mutual restraint and mutual supervision; it regulates the financial accounting and allocate adequate financial investment and the personnel quality and structure in accordance with the requirements of the new accounting standards to meet the internal control requirements so as to ensure that accounting information is true and complete and the financial reports are true, accurate and fair; it establishes a comprehensive budget management system, specifies the formulation, execution, utilization and feedback, etc. of financial budgets to get control of the whole process, which plays an active role in cost control, improving resource allocation and making rational use of resources; it identifies and regularly evaluates the business operation risks and internal control status in a timely manner in the principles of 55

comprehensiveness, effectiveness and appropriateness to ensure legal compliance in operation and management activities and the security and integrity of assets; it improves its effort to enforce the internal control system, link the performance of the internal control system to the performance assessment of the business and combat lack of enforcement of the system while implementing the incentive mechanism to ensure the internal control measures are in place throughout the process, including decision making, implementation, supervision and feedback, etc.

4. Monitoring and Evaluation of Internal Control Related Work The internal audit department is responsible for the construction of the internal control system and the monitoring and periodic evaluation of its implementation and urging branches and business units to revise and improve the system in accordance with national laws and regulations, banking organization structure, operation conditions and changes in the market, etc.

During the reporting period, the Audit Department of the Company has continuously promoted the operation office internal control evaluation all around to evaluate the internal control performance of rural and township banks based on continuous amendments to the internal control evaluation system; in addition, it has also carried out comprehensive audit on relevant branches and offices and rural and township banks to urge them to establish and complete their internal control measures and their management so as to further promote the compliance operation and build a sound internal control system. Through continual internal control evaluation, it has realized quantitative management of internal control of the offices, improved the endogenous motivation for sound operation and promoted the effective use of the internal control evaluation results and the combination of the internal audit evaluation with other risks management elements to greatly improve the internal control level.

5. Culture of Internal Control The Company attaches great importance to nurturing and developing an excellent corporate culture that not only embodies the features of modern commercial banks but also has its own characteristics. By combing, summarizing, regulating and improving the existing cultural factors to unify various fields in relation with operation and management, such as internal control, marketing, risk, incentive, evaluation, etc., in missions, visions and core values defined by the corporate culture and branding of the Company to form a distinctive business style, code of conduct and positive image of Suzhou Bank. The Company also highly values the construction of corporate sub-culture that focuses on business development and risk management to form a corporate culture development system consistent with the core values gradually to guide the whole staff to form a correct view of the performance and prudent risk and compliance awareness from the aspect of culture management.

The Company's internal control system has covered all institutions, departments and positions and penetrated into all business processes and operational links. It makes sure that a sound internal control is in place before any business development activity is carried out and has demonstrated satisfactory integrity, rationality and effectiveness in improving internal control environment, enhancing risk identification, monitoring and evaluation capacity, improving risk control measures, improving information exchange and feedback mechanism, strengthening monitoring, evaluation and corrective mechanisms, etc. It assures that the Company is able to implement the national laws, regulations and the banking regulatory rules, contribute to the fulfillment of the development strategy and business goals as well as the continuous steady development of various businesses and provide timely, accurate and integral business records,

financial information and other management information. The Company will continuously improve the integrity, reasonableness and effectiveness of the internal control system to align with any change in national laws and regulations, regulatory requirements and its own management and development.

6. Work Plan and Implementation Plan on the Establishment and Improvement of Internal Control

System According to the new requirements set forth in the Basic Norms of Internal Control for Enterprises and Guidelines on the Application of Internal Control in Enterprises issued by the Ministry of Finance and other four ministries, during the reporting period, the Company has launched relevant projects to improve the organizational structure of internal management system, formulate relevant work schemes and plans, organize for the overall combing of the business processes and management system of the Company and scientifically evaluate the internal control status while giving full consideration to the internal environment, risk assessment, control activities, information communication, internal supervision and other factors in the principles of optimization and continuous improvement. As the next step, the Company will steadily push forward the construction and implementation of the internal control mechanism on a long term basis, increase efforts to implement comprehensive risk control measures, share experience, and take active steps to explore management tools such as recording the noncompliance of employees to optimize the internal control and carry out relevant education and training, and build an internal control system that weaves through all levels of management and all business processes which is at the same time in line with the actual situation of the Company. By doing this, the Company’s management level and risk prevention ability will be improved to ensure the development strategy of the Company can be effectively carried out.

(II) Internal Audit The Company has established an internal audit body, i.e., Audit Department, which implements an independent audit mode under the line management of the head office, guided by the Audit Committee of the Board of Directors. During the reporting period, the Audit Department optimized the organizational structure, established Northern Jiangsu Audit Center and conducted independent examination and evaluation of all the businesses and management activities of the Company based on the Company’s specialty, to carry out supervision and inspection of the effectiveness of internal control and independent and objective assessment and consultation on internal control. It reported any significant audit findings and internal control deficiencies to senior management and the Audit Committee of the Board of Directors directly to ensure the independence and effectiveness of the internal audit. The Company established a more standardized internal audit system, an inspection system that combines on-site and off-site audits, in which off-site audits reach all of the Company's assets and liabilities operations; it carried out risk-oriented internal control audits, with the audit scope covering all business lines and internal control processes, including company business, retail business, financial markets, financial accounting and risk management, etc.; the audits have largely realized full coverage of credit risk, operational risk, market risk compliance risk.

The Company supervises and inspects the internal control situation through different forms such as on-site inspection, off-site audit, special audit, audits on departure, etc. It has fulfilled its functions to supervise, evaluate and provide consultation on internal control related jobs and there haven’t been any significant incidents occurred throughout the bank. The inspection involves the Company's business, retail business, operations management, financial management, trade finance, bills and documents and

information technology risk management, etc. For any problems found during the audit, the Company continuously tracks down and urges the audited entity to rectify timely. Any person found accountable will take liabilities. It has also stressed that head office and the branch offices and the management departments of each business line shall work closely to rectify problems. The Company takes active steps to sieve and eliminate business and process risks to greatly improve the integrity and management level of internal control system throughout the bank.

IX. Information Disclosure and Investor Relations

(I) Information Disclosure The Company strictly abides by the regulatory requirements in information disclosure activities and publishes periodic reports and ad hoc announcements to public according to law to ensure timely, accurate and complete disclosure of information and ensure that all shareholders have equal opportunity to access the company information.

(II) Investor Relations During the reporting period, the Company has applied innovative ideas in the management of investor relations with clear focus and enhanced efforts and has obtained remarkable results.

In investor relations management, while highlighting its market positioning by emphasizing “Small is beautiful. Helping people is beautiful” and “Serving SMEs, Serving the Public and Making Contributions to Regional Economic and Social Development” to achieve it strategic objectives, the Company focus on displaying its latest achievements and future potential in retail business and small and micro business, etc. to the investors.

During the reporting period, the leaders of the Company and major business units and heads of branches participate actively in investor relations-related work, pay visits to the main shareholders, receive large domestic and foreign institutional investors and demonstrates the Company’s specialty, advantages and future potential from strategic positioning to specific operations.

Chapter VI General Meetings

I. Information of General Meetings

During the reporting period, the Company held two general meetings, specifically:

1. The first general meeting of Suzhou Bank in 2012 was held at Suzhou Dushu Lake Hotel on March 22, 2012. The meeting was chaired by Wang Lanfeng, the Chairman of the Board. The directors, supervisors, senior managers and representatives from The Banking Regulatory Bureau and the legal counsel also joined the meeting. The meeting was consistent with national laws and the provisions of the Articles of Association of the Company and legally valid. The meeting passed the following matters: 2011 Annual Work Report of Board of Directors, 2011 Annual Work Report of President of Bank, 2011 Annual Work Report of Board of Supervisors, 2011 Annual Profit Distribution Plan, Report on the Implementation of 2011 Annual Financial Budgets, Preparation of 2012 Annual Financial Budgets, Proposal on the RMB Financial Bonds, Proposal on Comrade Gu Nanxing’s Resignation of Office as Director of Suzhou Bank Co., Ltd., Proposal on Nominating Comrade Xu Ting as Director of Suzhou Bank CO., Ltd., Proposal on Comrade Shang Ronggen’s Resignation of Office as Director of Suzhou Bank Co., Ltd., Proposal on Nominating Comrade Gu Nanxing as Supervisor of Suzhou Bank Co., Ltd., Proposal on Comrade Zhuang Yumin’s Resignation of Office as Independent Director of Suzhou Bank Co., Ltd., Proposal on Nominating Comrade Yang Haikun as Independent Director of Suzhou Bank Co., Ltd., and voted by ballot. All the above proposals were passed by the general meeting with resolutions formed.

2. The first extraordinary general meeting of Suzhou Bank in 2012 was held at Suzhou Dushu Lake Hotel Dec. 14, 2012. The meeting was chaired by Wang Lanfeng, the Chairman of the Board. The directors, supervisors, senior managers and representatives from The Banking Regulatory Bureau and the legal counsel also joined the meeting. The meeting was consistent with national laws and the provisions of the Articles of Association of the Company and legally valid. The meeting passed the following matters: Proposal of Suzhou Bank Co., Ltd. on Engaging Ernst & Young for Annual Audit, Proposal on Comrade Hua Fenjiu’s Resignation of Office as Director of Suzhou Bank Co., Ltd. and Proposal on Electing Comrade Zhu Wenbiao as Director of Suzhou Bank Co., Ltd., and voted by ballot. All the above proposals were passed by the general meeting with resolutions formed.

II. Election and Replacement of Directors, Supervisors and Senior Managers

During the reporting period, Mr. Xu Ting was elected Director and Bank President of Suzhou Bank Co., Ltd. at the first general meeting of the Company in 2012; Mr. Gu Nanxing resigned from his position as Director of Suzhou Bank Co., Ltd. and was elected Supervisor and Chairman of the Board of Supervisors; Mr. Shang Ronggen resigned from his position as Chairman of the Board of Supervisors and Supervisor; Mrs. Zhuang Yumin resigned from her position as Independent Director of Suzhou Bank Co., Ltd.; Mr. Yang Haikun was elected Independent Director of Suzhou Bank Co., Ltd.

Mr. Zhu Wenbiao was elected candidate Director of Suzhou Bank Co., Ltd. at the first extraordinary general meeting of the Company in 2012 and will take office upon the regulatory department’s approval on 59

his related qualifications; Mr. Hua Fenjiu resigned from his position as Director of Suzhou Bank Co., Ltd.

III. Shareholders' Rights

(I) Procedures to Convene an Extraordinary General Meeting An extraordinary general meeting shall be convened within two months from the date of occurrence of any of the following circumstances:

1. The number of directors falls below two thirds of the minimum number specified in the Articles of Association;

2. The loss that the Company fails to recover amounts to one third of the Company’s total share capital;

3. Upon written request of shareholders that represent 10% of the voting power (excl. proxy votes) of the Company, individually or collectively;

4. Proposed by the majority of independent directors;

5. Deemed necessary by the Board of Directors;

6. Proposed by the Board of Supervisors; and

7. Any other condition specified by the Articles of Association.

2. Procedure for Shareholders to Make Inquiries to the Board of Directors

Shareholders may at any time inquire the Board of Directors in writing through the Office of the Board of Directors. The contact information of the Board of Directors Office is as follows:

[Address: Board of Directors Office, Suzhou Bank, No. 728 Zhongyuan Road, Suzhou 215028, China]

Tel: 86 -512-69868130

Fax: 86 -512-69868124

E-mail: [email protected]

3. Procedure to Make Proposals at the General Meeting:

At the general meetings, shareholders that represent 3% of the voting power of the Company, individually or collectively, may bring a written draft proposal to the Board of Directors 10 days before the convening of the general meeting. The Board of Directors shall notify other shareholders within 2 days after receiving the proposal and submit the draft proposal to the general meeting for review. The content of the proposal shall fall within the authority of the general meeting and have clear subjects and specific issues.

Shareholders that represent 3% of the voting power of the Company, individually or collectively, may ask questions at the general meeting. The Board of Directors, Board of Supervisors or relevant member of senior management shall attend the general meeting to answer the questions. 60

Chapter VII: Important Issues

I. Major Litigation & Arbitration

Currently, the Compliance and Risk Department of Head Office is in full charge of the management of legal affairs of the bank. The Credit Management Department of Head Office is responsible for the management and undertaking of legal affairs in relation with risk assets that is mainly credit assets.

We’ve hired full-time legal advisor with practical ability and strong theoretical to assist the bank in legal affairs management.

Currently, the litigation faced by the bank is largely credit related and we, as the plaintiff, prosecute against breaching borrowers. In 2012, in spite of the complex economic environment and the increase of non-performing assets in the banking sector, there was no apparent increase in the number of litigation arbitration cases in the Bank.

II. Acquisition and Disposal of Assets & Merger

NONE

III. Major Contracts and Performance

In the aspect of contract management, the Bank has developed Suzhou Bank Contract Management Interim Measures that elaborately and clearly defines every single step of contract management, including project establishment, negotiations, drafting, review, filing, countersigning, execution, performance, changes and termination. The Bank strictly adheres to the Measures in contract management and at the same time, for important contracts with larger value, ask legal advisors to review the contract. Therefore, in 2012, there were no disputes or incidents arising from contract mismanagement and all contracts were properly fulfilled.

IV. Material Guarantees

The guarantee business of the Company is approved by People's Bank of China and China Banking Regulatory Commission. It’s a normal conventional operation. The Company attaches importance to the risk management of guarantee business and has developed detailed business management approaches and operating procedures; the Company uses different management methods such as on-site and off-site inspection, etc. to monitor and prevent risks in guarantee. During the reporting period, the guarantee business of the Company worked properly and there were no material guarantee issues that need to be disclosed.

V. Commitments During the reporting period, there were no undertakings of the Company that need explanation.

VI. Appointment of Auditors The Company engaged Ernst & Young to audit its 2012 annual financial statements according to the 61

resolutions made at the first extraordinary general meeting of 2012 at the cost of RMB 900,000 Yuan.

VII. Significant Connected Transactions Refer to Chapter IX Financial Reports for details.

VIII. Other Important Matters

NONE

Chapter VIII Corporate Social Responsibility

It is at the core of the Company’s social responsibility actions to find the way to help SMEs, the agriculture industry, the rural areas and the farmers and serve the local economy while following the guidelines of “Serving the Public and Caring the Fellows”. It has carried out a series of actions to enhance the management level on social responsibility such as improving our organizational structure, management system and project system and establishing scientific, perfect and linked corporate social responsibility management system. The system is now a common reference point we use to guide our business development, monitor our public welfare program, start business with external institutions and promote the practice of our branches. In order to make our social work more scientific, professional and elaborate, we have planned to launch a project in 2013that is designed to set up the corporate social responsibility management structure.

We have adopted the way of strengthening communication with interested parties so as to fulfill our social responsibility and realize our sustainable development. To be specific, we set up the trinity (i.e. daily, regular and annual) communication system and devote ourselves to research the topics highly concerned by the interested parties or by the public and those studied and emphasized by the domestic and foreign standards and the latest theories. We have also positively communicated with the interested parties on these topics conveying our philosophy of undertaking social responsibility. Meanwhile, we made great effort to enhance our capacity building so as to satisfy interested parties’ changing expectations.

To be specific, our social responsibility is focused on three aspects.

1. To serve the public. It is our innate responsibility to serve customers, to be kind to employees, to reward shareholders, to respect partners, to repay communities and respond to policies. 2. To care our fellows. We are dedicated to providing the highest level of financial service to our citizens so as to make contributions to the health and rapid development of the whole society. 3. To gain customer loyalty. We will drive ourselves to become the first choice of customers for financial service as well as the first choice of interested parties as investors, excellent talents and partners to work with!

I. Honest Operation

We run our business in accordance with the laws and regulations to make sure that our company develops steadily and sustainably. We always treat our customers and employees honestly and do our utmost to provide high quality services to the general public. In addition, we strengthened our financing support to the projects relevant to guarantee the economy increase, benefit the people and adjust the industry structure. We have been striving to provide the general public modern financial products and services, guide the public with advanced financial concepts and create new financial experience for our customers.

II. Serving the Customers

The Company strives to provider better financial services to customers under the guideline of "Sincere Commitment and Start-level Service", engage third-party research institutions to investigate the business department of the Head Office and the subordinate outlets in Suzhou and adopts the mystery 63

shopping method to evaluate the service according to Suzhou Banking Service Quality Evaluation Criteria.

III. Staff Development

The essential element of a harmonious enterprise is harmonious labor relations and consistency between the employee development and the corporate vision. The Company has established labor relations safeguard mechanism and enhanced employee salaries and benefits, ensures the employees can exercise their democratic rights and strives to deliver the commitment to creating harmonious labor relations.

Firstly, open channels to select talents;

Secondly, create three-dimensional training mode. Suzhou Bank Networking Academy has laid a solid foundation for the building of a "learning bank"; and

Thirdly, effectively improve the service level.

IV. Financial Education and Trade Exchanges

Suzhou Bank attaches further importance to the information disclosure initiative to improve investor relations management, strengthen financial education efforts on consumers and promote exchanges with industry peers to enhance the brand image of the Bank continuously. Firstly, standardize the management of information disclosure. Efforts shall be made to improve corporate transparency and disclose properly periodic reports, temporary announcements and related documents so as to disclose all material information of the Company timely, accurately and completely to guarantee that investors keep abreast of the operation and management development of the Bank. Secondly, strengthen the management of investor relations. Take active measures to manage investor relations, visit the major shareholders even home visits, and drive the entire staff to focus on the new development of Suzhou Bank in the capacity of Chief Marketing Officer (CMO). Meanwhile, carry out adequate, timely and effective communication with investors through the Board of Directors, general meetings and Investors’ Bulletin, etc. to promote the unity of the Company's market value and its intrinsic value.

V. Public Welfare

Since its inception, Suzhou Bank has adhered to the guidelines of contributing to social security and stability and pursuing sustainable development. Since 2009, Suzhou Bank has been donated CNY 100,000 to the local charity every time it opens a new office.

Chapter IX Financial Report (See the Appendix)

I. Audit Report

II. Audited Financial Statements (consolidated and the company asset balance sheet; consolidated and the company statement of profit distribution, consolidated and the company cash flow statement, consolidated statement of changes in the owner's equities)

III. Notes to Financial Report