2020 ANNUAL REPORT * Bank of Jinzhou Co., Ltd. is not an authorized institution within the meaning of the Banking Ordinance (Chapter 155 of the Laws of Hong Kong), not subject to the supervision of the Hong Kong Monetary Authority, and not authorized to carry on banking and/or deposit-taking business in Hong Kong. Contents 2 Definitions 4 Chapter 1 Company Profile 7 Chapter 2 Financial Highlights 10 Chapter 3 Chairman’s Statement 12 Chapter 4 President’s Statement 14 Chapter 5 Management Discussion and Analysis 76 Chapter 6 Changes in Ordinary Shares and Particulars of Shareholders 85 Chapter 7 Particulars of Offshore Preference Shares 88 Chapter 8 Directors, Supervisors, Senior Management, Employees and Organizations 105 Chapter 9 Corporate Governance Report 130 Chapter 10 Directors’ Report 142 Chapter 11 Supervisors’ Report 144 Chapter 12 Social Responsibility Report 146 Chapter 13 Internal Control and Internal Audit 149 Chapter 14 Important Events 155 Chapter 15 Independent Auditor’s Report and Financial Statements 305 Chapter 16 Unaudited Supplementary Financial Information Bank of Jinzhou Co., Ltd. 2020 Annual Report 1 Definitions In this annual report, unless the context otherwise requires, the following terms shall have the meanings set out below: “Articles of Association” the articles of association of the Bank, as amended from time to time “Bank”, “Bank of Jinzhou” or “Group” Bank of Jinzhou Co., Ltd. (錦州銀行股份有限公司), a joint stock company incorporated in the PRC on 22 January 1997 with limited liability in accordance with PRC laws and, unless the context requires otherwise, includes its subsidiaries, branches, sub-branches and special institutions “Board” or “Board of Directors” the board of Directors of the Bank “Board of Supervisors” the board of Supervisors of the Bank “CBIRC” China Banking and Insurance Regulatory Commission, which was formed after the duty restructuring of China Banking Regulatory Commission (the “Former CBRC”) and China Insurance Regulatory Commission “Former CBRC Liaoning Bureau” the former China Banking Regulatory Commission Liaoning Bureau (中國銀行業監督管理委員會遼寧 監管局), now renamed as China Banking and Insurance Regulatory Commission Liaoning Bureau (中國 銀行保險監督管理委員會遼寧監管局) “Chengfang Huida” Beijing Chengfang Huida Enterprise Management Co., Ltd. (北京成方匯達企業管理有限公司) “Company Law” the Company Law of the People’s Republic of China “Corporate Governance Code” the Corporate Governance Code as set out in Appendix 14 of the Listing Rules “CSRC” China Securities Regulatory Commission “Debt Instrument Subscription” the subscription by the Bank of a directional debt instrument issued by Jinzhou Jinyin Enterprise Management Partnership (LLP) (錦州錦銀企業管理合夥企業（有限合夥)) “Disposal” the disposal of certain credit assets and other assets by the Bank in 2020 which constituted a very substantial disposal of the Bank “Director(s)” the director(s) of the Bank “Domestic Share(s)” the ordinary share(s) in the share capital of the Bank with a nominal value of RMB1.00 each, which are subscribed for or credited as paid up in Renminbi by PRC nationals and/or PRC corporate entities “H Share(s)” the ordinary share(s) in the share capital of the Bank with a nominal value of RMB1.00 each, which is/are subscribed for and traded in HK dollars and listed on the Main Board of the Hong Kong Stock Exchange “HK$” or “HK dollars” the lawful currency of Hong Kong 2 Bank of Jinzhou Co., Ltd. 2020 Annual Report Definitions “Hong Kong” the Hong Kong Special Administrative Region of the PRC “Hong Kong Stock Exchange” The Stock Exchange of Hong Kong Limited “ICBC” Industrial and Commercial Bank of China Limited “Latest Practicable Date” 29 March 2021, being the latest practicable date prior to the printing of this annual report for ascertaining certain information in this report “Listing Rules” the Rules Governing the Listing of Securities on the Hong Kong Stock Exchange, as amended, supplemented or otherwise modified from time to time “Liaoning Financial Holding” Liaoning Financial Holding Group Co., Ltd. (遼寧金融控股集團有限公司) “Offshore Preference Share(s)” non-cumulative perpetual offshore preference shares for the amount of US$1,496,000,000 with a dividend rate of 5.50% issued by the Bank on 27 October 2017 and listed on the Hong Kong Stock Exchange (stock code: 4615) “PBOC” the People’s Bank of China “PRC” or “China” the People’s Republic of China, for the purposes of this annual report only, refers to the territory of the People’s Republic of China, excluding the Hong Kong Special Administrative Region of the PRC, the Macau Special Administrative Region of the PRC and Taiwan region of the PRC “Proposed Private Placement” the private placement of not more than 6.2 billion new Domestic Shares by the Bank in 2020 under a specific mandate “Reporting Period” the year ended 31 December 2020 “RMB” or “Renminbi” Renminbi, the lawful currency of the PRC “SFO” the Securities and Futures Ordinance, Chapter 571 of the Laws of Hong Kong, as amended, supplemented or otherwise modified from time to time “Shareholder(s)” the holder(s) of the share(s) of the Bank or “Ordinary Shareholder(s)” “Share(s)” or “Ordinary Share(s)” the Domestic Share(s) and the H Share(s) of the Bank, excluding the Offshore Preference Share(s) “Supervisor(s)” the supervisor(s) of the Bank “US$” or “US dollars” the lawful currency of the United States of America Bank of Jinzhou Co., Ltd. 2020 Annual Report 3 Chapter 1 Company Profile I. Basic Information about the Company Legal Chinese Name and Abbreviation : 錦州銀行股份有限公司(abbreviated as “錦州銀行”) Legal English Name and Abbreviation : BANK OF JINZHOU CO., LTD. (abbreviated as “BANK OF JINZHOU”) Legal Representative : Mr. Wei Xuekun Authorised Representatives : Mr. Wei Xuekun, Mr. Guo Wenfeng Secretary to the Board of Directors : Mr. Yu Jun (whose qualification is subject to the approval of the regulatory authorities) Joint Company Secretaries : Mr. Yu Jun, Ms. Leung Wing Han Sharon Registered and Office Address : No. 68 Keji Road, Jinzhou City, Liaoning Province, the PRC Postal Code : 121013 Telephone : +86-416-3220002 Fax : +86-416-3220003 Company Website : www.jinzhoubank.com Email Address : [email protected] Customer Service Hotline : +86-400-66-96178 Principal Place of Business in Hong Kong : 40th Floor, Dah Sing Financial Centre, 248 Queen’s Road East, Wanchai, Hong Kong Accounting Firm : Crowe (HK) CPA Limited PRC Legal Advisor : King & Wood Mallesons Hong Kong Legal Advisor : King & Wood Mallesons 4 Bank of Jinzhou Co., Ltd. 2020 Annual Report Chapter 1 Company Profile Custodian of Domestic Shares : China Securities Depository and Clearing Corporation Limited H Share Registrar : Computershare Hong Kong Investor Services Limited Listing Place of Stock, Stock Name and : H Shares: Hong Kong Stock Exchange; BANKOFJINZHOU; 0416 Stock Code Offshore Preference Shares: Hong Kong Stock Exchange; BOJZ 17USDPREF; 4615 Uniform Social Credit Code of Corporation : 912107002426682145 Finance License No. of Institution : B0127H221070001 Website of the Hong Kong Stock Exchange : www.hkexnews.hk where this annual report is published Place where the annual report is : Office of the Board of Directors of the Bank maintained II. Company Profile Bank of Jinzhou was incorporated, with the approval of the PBOC, on 22 January 1997, and headquartered in Jinzhou City, Liaoning Province, the PRC. The Bank established 15 branches in Beijing, Tianjin, Shenyang, Dalian, Harbin, Dandong, Fushun, Anshan, Chaoyang, Fuxin, Liaoyang, Huludao, Benxi, Yingkou and Jinzhou, the PRC and promoted and established seven village and township banks, namely Jinzhou Taihe Jinyin Village and Township Bank Co., Ltd. (錦州太和錦銀村鎮銀行股份有限公司), Liaoning Yixian Jinyin Village and Township Bank Co., Ltd. (遼寧義縣錦銀村鎮銀行股份有限公司), Liaoning Beizhen Jinyin Village and Township Bank Co., Ltd. (遼寧北鎮錦銀村鎮銀行股份有限公司), Liaoning Heishan Jinyin Village and Township Bank Co., Ltd. (遼寧 黑山錦銀村鎮銀行股份有限公司), Liaoning Kazuo Jinyin Village and Township Bank Co., Ltd. (遼寧喀左錦銀村鎮銀行股份有限公 司), Liaoning Linghai Jinyin Village and Township Bank Co., Ltd. (遼寧凌海錦銀村鎮銀行股份有限公司) and Liaoning Huanren Jinyin Village and Township Bank Co., Ltd. (遼寧桓仁錦銀村鎮銀行股份有限公司). Bank of Jinzhou also promoted and established Bank of Jinzhou Financial Leasing Co., Ltd. (錦銀金融租賃有限責任公司). As at the end of the Reporting Period, the Bank had 242 branches in aggregate. As at the end of the Reporting Period, the Bank had registered capital of RMB13,981,615,684, total assets of RMB777.992 billion, loans and advances balances released of RMB496.750 billion and balance of deposits of RMB439.224 billion. The businesses scope of the Bank includes absorption of public deposit, publishment of short-term, medium-term and long-term loans, domestic and overseas settlement, issue of financial bonds and inter-bank borrowing. The H Shares of the Bank were listed on the Main Board of the Hong Kong Stock Exchange (stock code: 0416) on 7 December 2015. On 27 October 2017, the Bank successfully issued US$1.496 billion of Offshore Preference Shares which were listed on the Hong Kong Stock Exchange with stock code 4615. Bank of Jinzhou Co., Ltd. 2020 Annual Report 5 Chapter 1 Company Profile III. Awards in 2020 In February 2020, the Bank was awarded the 2019 Excellent Promotion Contribution for China UnionPay Card Product (2019年銀聯 卡產品推廣突出貢獻獎). In July 2020, the Bank was awarded the 2019 Exemplary Organization in Credit System Data Quality by the PBOC. In November 2020, the Bank was awarded the Best Credit Card Cross-industry Cooperation (年度最佳信用卡跨界合作獎) in the first session of 2020