2019 Annual Report Address: No. 36 Jinshamen Road, Jiangbei District, Chongqing, China Mail Box: 400023 www.cqrcb.com 2019 Annual Report Annual 2019 CHONGQING RURAL COMMERCIAL BANK Stock Code: 3618 * The Bank holds a financial licence number B0335H250000001 approved by the China Banking and Insurance Regulatory Authority and was authorised by the Market Supervision Administration of Chongqing Municipality to obtain a corporate legal person business licence with a unified social credit code 91500000676129728J. The Bank is not an authorised institution in accordance with the Hong Kong Banking Ordinance (Chapter 155 of the Laws of Hong Kong), not subject to the supervision of the Hong Kong Monetary Authority, and not authorised to carry on banking/ deposit-taking business in Hong Kong. Company Profile Chongqing Rural Commercial Bank Co., Ltd. (hereinafter referred to as “Chongqing Rural Commercial Bank”), formerly known as Chongqing Rural Credit Cooperative, was established in 1951 and has a history of more than 60 years. In 2003, Chongqing became one of the first batch of pilot provinces and cities for the nationwide rural credit cooperative reform. In 2008, the rural commercial bank with a unified legal person in the city was established. In 2010, the Bank’s H-share was successfully listed on the Main Board of the Hong Kong Stock Exchange, becoming the first listed rural commercial bank in China and the first listed bank in the Western China. In October 2019, the Bank was successfully listed on the main board of the Shanghai Stock Exchange, becoming the first rural commercial bank with A+H dual listing in China and the first bank with A+H dual listing in the Western China. In the recent years, Chongqing Rural Commercial Bank has made every effort to implement the strategy of “establishing banks with retail, prospering banks with technology, and strengthening banks with talents”, adhering to retail as the basis of the Bank’s development and survival to create distinctive retail brands with outstanding contributions and market leadership; adhering to financial technology (“fintech”) as the Bank’s innovation “engine” and driving force for growth to build a fintech platform that is autonomous, controllable, intelligent, efficient, and leading the development; adhering to talents as the Bank’s core resources and precious treasure to build a high-quality talent team and to promote high-quality development across the Bank. As of the end of 2019, Chongqing Rural Commercial Bank had 6 branches and 35 sub-branches, with a total of 1,774 operating outlets, and had initiated the establishment of 1 financial leasing company and 12 village and township banks, and had more than 15,000 employees. The asset scale exceeded RMB1,000 billion, amounting to RMB1,030.2 billion. The balance of deposits was RMB673.4 billion and the balance of loans was RMB437.1 billion, respectively. The Bank ranked No. 137 among the world banks and ranked No. 20 among the China’s banking industry. Annual Report 2019 1 Major Awards Ranked No. 137 among the “Top 1,000 World Banks 2019” and ranked No. 22 among the Chinese- funded banks in The Banker of the UK. Ranked No. 20 on the “List of Top 100 among China Banking Industry in 2019” of China Banking Association. Ranked No. 370 among the “2019 Top 500 Enterprises in China” and No. 134 among the “2019 Top 500 Enterprises in China’s Service Industry” of China Enterprise Confederation and China Enterprise Directors Association. Ranked No. 326 among the China’s Top 500 in 2019 by the Fortune magazine. Won the “2019 Outstanding Contribution Award for HCE Advertising” of China UnionPay. Won the “Best Digital Financial Innovation Award” of the 2019 Gold List of E-banking in China issued by China Financial Certification Authority. Won the “Top 100 Settlement – Excellent Proprietary Trader Award”, “Outstanding Organisation for Savings Bonds (Electronic) Business” and “Outstanding Organisation for Security Business” in 2019 issued by China Central Depository & Clearing Co., Ltd. Won the “Advanced Unit of Financial Standard Innovation”, “Advanced Unit of Fintech Innovation” and “Advanced Unit for the Piloting of Face Recognition Offline Application” in 2019 issued by Chongqing Operations Office of the People’s Bank of China. Won the “Outstanding Rural Commercial Bank under 2019 Debt Financing Program” of Beijing Financial Assets Exchange. Won the “Top 10 Retail Banks of Rural Commercial Banks” and “Top 10 Private Banks of Local Banks” of 2019 China Retail Finance Innovation‧Practice Award organised by Retail Banks Magazine. Won the “Best Investment Value Award” and “Best Investor Relations Award” of 2019 China Finance Award by China Financial Market Magazine. Won the “Outstanding Contribution Award for Financial Technology Innovation in 2019” and “Contribution Award for Management Innovation” of Financial Computerizing Magazine. Won the “Golden Horse Award” and “Fintech Empowerment Pioneer” in 2019 issued by Securities Daily. Won the “2019 China Rural Commercial Bank Asset Management Brand Junding Award”, “2019 China Closed Net Worth Bank Wealth Management Product Junding Award” and “2019 Rural Commercial Bank Tianji Award” of Securities Daily. Won the “Commercial Bank of the Year” in the 2019 TOP Financial List of The Paper organised by Shanghai United Media Group. 2 CHONGQING RURAL COMMERCIAL BANK Major Awards Won the “Special Award for ‘Mobile Phone Number Payment’ Case” in 2019 China Financial Brand Case of the Year Competition organised by China Finance. Won the “Civic Education Outstanding Enterprise of the Year” of China Jinding Award in 2019 issued by National Business Daily. Jiangyu Wealth —“Building up your fortune” (“天添金”), the Bank’s net worth wealth management product, won the “2019 ‘Gold Financial Management’ Net Worth Wealth Management Product Excellence Award” of Shanghai Securities News. Recognised as the “Financial Poverty Alleviation Pioneer Organization” in “2019 Financial Poverty Alleviation Pioneer List” by China Internet. Won the “Outstanding Financial Institution of Contribution to Service in Chongqing”, “Outstanding Financial Institution of Contribution to Financial Poverty Alleviation” and “Fintech Leader of the Year” at the First Chongqing Finance · Upstream List in 2019 organised by Chongqing Daily Newspaper Group and Chongqing City Media Group. Annual Report 2019 3 Contents of the Annual Report 1. Definitions 5 2. Company Basic Information 7 3. Important Notice 9 4. Financial Summary 10 5. Chairman’s Statement 13 6. President’s Statement 15 7. Management Discussion and Analysis 17 7.1 Overview 17 7.2 Financial Review 18 7.3 Discussion and Analysis of Main Business Operations 56 7.4 Key Business Concerns 88 7.5 Risk Management 96 7.6 Capital Management 112 7.7 Financial Consumer Rights Protection 117 7.8 Outlook 119 8. Corporate Social Responsibility 121 9. Changes in Shares and Particulars of Shareholders 123 10. Directors, Supervisors and Senior Management 134 11. Corporate Governance Report 154 12. Report of the Board of Directors 179 13. Report of the Board of Supervisors 196 14. Major Events 200 15. Audit Report 210 16. Financial Statements and Notes 218 17. Unaudited Supplemental Information 369 18. Organization Chart 374 19. Branches and Subsidiaries 375 4 CHONGQING RURAL COMMERCIAL BANK Definitions In this annual report, unless the context otherwise requires, the following terms shall have the meanings set out below. “Bank” or “our Bank” Chongqing Rural Commercial Bank Co., Ltd. (重慶農村商業銀行股份有限公司) “CBIRC Chongqing Office” China Banking and Insurance Regulatory Commission Chongqing Regulatory Bureau (中國銀行保險監督管理委員會重慶監管局) “CBIRC” China Banking and Insurance Regulatory Commission “CBRC” the former China Banking Regulatory Commission (中國銀行業監督管理委員會) “China Banking Regulatory the China Banking and Insurance Regulatory Commission and its Authority” agencies “CSRC” China Securities Regulatory Commission “CPC” Chinese Communist Party (中國共產黨) “Board of Directors” or “Board” the board of directors of the Bank “Board of Supervisors” the board of supervisors of the Bank “County Area” the regions other than Urban Area of Chongqing City, including 29 districts and counties “Articles of Association” Articles of Association of Chongqing Rural Commercial Bank Co., Ltd.*, as amended from time to time “Group” Chongqing Rural Commercial Bank Co., Ltd.* (重慶農村商業銀行股份有限公司) and its subsidiaries “RMB or Renminbi” Renminbi, the lawful currency of the PRC “yuan” RMB yuan “HKD or HK$ or HK dollars” Hong Kong dollars, the lawful currency of Hong Kong “Hong Kong” Hong Kong Special Administrative Region, the PRC “Hong Kong Stock Exchange” The Stock Exchange of Hong Kong Limited “Hong Kong Listing Rules” The Rules Governing The Listing of Securities on The Stock Exchange of Hong Kong Limited, as amended from time to time Annual Report 2019 5 Definitions “Shanghai Stock Exchange” Shanghai Stock Exchange “Two Highs and One Surplus refers to industries with high pollution, high energy consumption Industry” and excess capacity “rural commercial bank” a short-hand reference to rural commercial bank (農村商業銀行) “Sannong” a short-hand reference to the Chinese pronunciation of the phrase “agriculture, rural areas and farmers” “Three-Transformation” the strategy for future development of the Bank, that is, characteristic operation, streamlining the management and fostering good corporate culture “village and township banks” bank institutions that are approved by China Banking Regulatory Authority to be incorporated in rural areas to