China International Capital Corporation Limited (a joint stock limited company incorporated in the People's Republic of China) Stock code: 3908 Annual Report 2019 Core Values By the People and Professionalism and For the Nation Diligence People are our most valuable assets. We strive We develop our businesses up to the highest to attract, cultivate and retain the best people. professional standards, and nurture a high- Since inception, CICC has positioned itself as “a caliber team of financial professionals, who boast China-based investment bank with international international visions, diligently perform their duties perspectives”. It is our mission to serve the nation and share our corporate values. by promoting economic reform and long-term development of the capital markets. Innovation and Client Entrepreneurship First Innovation is the lasting force that drives CICC We always put our clients first. We develop and forward. Blessed with deep industry knowhow, maintain long-term relationships of trust with visionary leadership, close relationship with clients, our clients by truly safeguarding their interests and abundant execution experiences, CICC is and satisfying their needs. always prepared to embrace change and continue to deliver innovative products and quality services to our clients. Integrity Chinese Roots and International Reach We build our franchise upon the utmost professional integrity and highest ethical standards. As a China-based global investment bank, we are We value our franchise and never compromise on proud of our Chinese roots and of our international integrity. DNA. We bridge China and the world by providing best-in-class services to clients at home and abroad. Content 2 Important Notes 3 Significant Risk Warnings 4 Message from Our Chairman 6 Message from Our CEO 13 Definitions 18 Company Profile 29 Summary of Accounting Data and Financial Indicators 32 Management Discussion and Analysis 96 Directors’ Report 103 Other Significant Events 105 Changes in Shares and Information of Substantial Shareholders 110 Directors, Supervisors, Senior Management and Employees 134 Corporate Governance Report 156 Environmental, Social and Governance Report 177 Independent Auditor’s Report 195 Consolidated Financial Statements 333 Appendix Important Notes The Directors, Supervisors and senior management of our Company undertake that there are no misrepresentation, misleading statement or material omission in this report and they are severally and jointly liable for the authenticity, accuracy and completeness of the information contained in this annual report. “ ” 2019 Annual Report2019 Annual The financial statements for 2019 were prepared by our Company according to International Financial Reporting Standards ( IFRSs ), which have been audited by Deloitte Touche Tohmatsu and Deloitte Touche Tohmatsu has issued auditors’ report with unqualified opinions. Unless otherwise stated, the amounts in this report are presented in RMB. 2 The forward-looking statements such as future plans, development strategies contained in this report do not constitute substantive undertakings by our Company to investors who are advised to be cautious about investment risks. China International Capital Corporation Limited Corporation China International Capital Significant Risk Warnings Significant Risk Warnings The business operations of our Group are closely related to the macro economy, monetary policy and market conditions in China and other jurisdictions where our businesses are operated. Any fluctuation in domestic and international capital markets will affect the Group’s business operations. The risks faced by our Group mainly include: strategic risk arising from the adjustment of the strategic plan of our Group under the Report2019 Annual changes in domestic and overseas capital markets; business management risk arising from changes of business models, development of innovative businesses and application of new technologies; market risk caused by changes in the fair value of the financial assets held by 3 the Group resulting from fluctuations in equity prices, interest rates, exchange rates and commodity prices, etc; credit risk arising from defaults or deterioration in creditworthiness of counterparties, financing parties and issuers of securities; liquidity risk arising from our Group’s inability to obtain sufficient funds at reasonable costs in a timely manner to settle debts due, fulfill other payment obligations, and satisfy the funding needs in conducting normal business operations; operational risk arising from losses resulting from failed or defective internal procedures or IT systems, human factors and external events; compliance risk arising from legal sanctions, regulatory actions, loss of property or damage to our reputation, which our Group is to be subject to, imposed on or suffered from as a result of violation of laws, regulations, self-regulatory rules or our internal policies arising from our operations and management activities or employee behavior; legal risk for which our Group may suffer from economic loss or loss of reputation arising from breach of contracts, disputes in respect of infringement, litigations or other legal disputes; and reputational risk caused by negative comments on our Group due to operational activities, business management and other actions as well as external events; IT risk refers to the operational, legal and reputational risks arising from natural disasters, human factors, technology vulnerabilities and management deficiencies in the course of carrying out business activities or providing services by means of information technology. Our Group will work on its organizational structure, management mechanism, IT system, risk indicator framework, talents cultivation and Limited Corporation China International Capital risks response mechanism to prevent and manage the above mentioned risks. For detailed analysis and measures taken by our Group in respect of the risks, please refer to the content in “Management Discussion and Analysis – VI. Risk Management”. Message from Our Chairman DEAR SHAREHOLDERS, 2019 marks the 70th anniversary of the founding of the People’s Republic of China, and the year for reforms of China’s capital market. With the launch of the science and technology 2019 Annual Report2019 Annual innovation board and the steady advancement of piloting of the registration-based IPO system, China has put forward the 4 road map for comprehensively deepening reforms of the capital market and accelerated the opening-up of its financial industry to foreign players. In 2019, CICC has been forging ahead and striving forward to constantly improve its core competitiveness. To cope with the complicated domestic and global landscapes, our Company proactively implemented and played an active role in the national strategies to support the real economy, prevent financial risks and advance financial reforms, maintaining a steady growth in various businesses. Our Company ranked first acting as sponsor in terms of underwriting amount of IPOs in A shares, the Hong Kong market and the science and technology innovation board, and China International Capital Corporation Limited Corporation China International Capital completed numerous landmark projects. Riding on our increasing advantages in institutional and high-end businesses and our steady improvement in comprehensive customer service capabilities, our balance sheet business recorded significant growth. We managed to gain new ground in the transformation and upgrading of wealth management and investment management businesses and completed the name change of CICC Wealth Management, with the Group’s total assets under management of over RMB800 billion. As for the organization of the Company, we have further deepened our international presence, smoothly carried out risk control and compliance work, constantly improved the development of corporate culture and strengthened Party building wok significantly, contributing more effort in poverty alleviation and social welfare. Facing the national challenge of the COVID-19 epidemic, our Group has actively responded to the call of our country, made every effort to follow the policy guidance of the CPC Central Committee on epidemic prevention and control, gave full play to our own advantages by taking multiple measures to ensure provision of financial services, and helped the country fight the epidemic by various means such as issuing epidemic prevention and control debts. 2019 Annual Report2019 Annual 2020 is the final year for building a moderately prosperous society in all aspects and achieving the first centenary goal as well as 5 the 25th anniversary of the establishment of CICC, which is of extraordinary significance. For the past 25 years, CICC has been giving full play to its piloting and leading role in introducing advanced international experience, and witnessed the progress of the China’s capital market. With serving the national strategy and supporting reforms and innovation as our responsibilities, we have maintained industry-leading position in quality, efficiency, risk control and compliance, gradually developing as a modern investment bank with market competitiveness and brand influence. During China’s progress in comprehensively deepening structural supply-side reforms, increasing the proportion of direct financing and expanding opening-up, we will continue to Limited Corporation China International Capital leverage our leading advantages in investment banking, research, cross-border