The First 首届九江銀行 "Distinguished Strivers" “更卓越奮鬥者” of Bank of Jiujiang 2020 2020 INTERIM REPORT 中期報告 九江銀行股份有限公司 九江銀行股份有限公司 Bank of Jiujiang Co., Ltd. Bank of Jiujiang Co., Ltd. (A joint stock company incorporated in the People’s （於中華人民共和國註冊成立的股份有限公司） Republic of China with limited liability) 股份代號：6190 Stock Code : 6190 2 Company Profile 5 Accounting Data and Financial Indicator Highlights 8 Management Discussion and Analysis 76 Changes in Share Capital and Information on Shareholders 89 Information on Directors, Supervisors, Senior Management, Staff and Institution 109 Corporate Governance Contents 115 Significant Issues 118 Review Report to the Board of Directors of Bank of Jiujiang Co., Ltd. 120 Consolidated Statement of Profit or Loss and Other Comprehensive Income 122 Consolidated Statement of Financial Position 124 Consolidated Statement of Changes in Equity 125 Consolidated Statement of Cash Flows 127 Notes to the Consolidated Financial Statements 185 Definition Company Profile 1. Basics Legal name in Chinese: Registered address and office address: 九江銀行股份有限公司* No. 619 Changhong Avenue, Lianxi District, Jiujiang, Jiangxi Province, China Legal name in English: (Postal code: 332000) Bank of Jiujiang Co., Ltd.* Principal place of business in Hong Kong: Legal representative: 40/F, Sunlight Tower, 248 Queen’s Road LIU Xianting (劉羨庭) East, Wan Chai, Hong Kong Authorized representatives**: Contact details: PAN Ming (潘明), FOK Po Yi (霍寶兒) Tel: +86 (792) 7783000-1101 Fax: +86 (792) 8325019 Board secretary**: Email: [email protected] WANG Li (王琍) Website: http://www.jjccb.com Company secretary**: Customer service hotline: +86 95316 FOK Po Yi (霍寶兒) PRC auditor: H-share exchange: KPMG Huazhen LLP The Stock Exchange of Hong Kong Limited International auditor: Stock short name: KPMG BANKOFJIUJIANG PRC legal advisor: Stock code: JunHe LLP (北京市君合律師事務所) 6190 Hong Kong (PRC) legal advisor: Unified social credit code: Clifford Chance 9136040070552834XQ H-share registrar and transfer office: License number for financial business Computershare Hong Kong Investor Services operations: Limited B0348H236040001 Domestic share depository: Registered capital: China Securities Depository and Clearing RMB2,407,367,200 Corporation Limited (CSDC) HKEXnews website of the Hong Kong Stock Exchange for publication of this report: http://www.hkexnews.hk * The Bank is not an authorized institution within the meaning of the Banking Ordinance (Chapter 155th of the laws of Hong Kong), is not subject to the supervision of the Hong Kong Monetary Authority, and is not authorized to carry on banking and/or deposit-taking business in Hong Kong. ** Please refer to the chapter headed “Information on Directors, Supervisors, Senior Management, Staff and Institution” of this interim report for changes in positions of authorized representative, Board Secretary and Company Secretary of the Bank. 2020 INTERIM REPORT 2 2. Company Profile Approved by Wuhan Branch of the People’s Bank of China for establishment, Bank of Jiujiang Co., Ltd. (“Bank of Jiujiang” or the “ Bank” or “our Bank”) was a regional commercial bank incorporated in November 2000 from eight urban credit cooperatives in Jiujiang City. In October 2008, the Bank officially changed its name to the Bank of Jiujiang Co., Ltd. On July 10, 2018, the Bank of Jiujiang was listed on the Main Board of the Hong Kong Stock Exchange (stock code: 6190). Over the past 20 years, staff members of Bank of Jiujiang, with unwavering faith, persistent pursuit, selfless dedication, and the mindset that success only comes through hard work, have endured through great hardships in order to realize the achievements that Bank of Jiujiang has today. From a handful of branches to 274 outlets, we are now a renowned bank with total assets of over RMB390,000 million which also embodies the entrepreneurial spirit of Bank of Jiujiang – unity, integrity, perseverance and creativity. Over the past 20 years, Bank of Jiujiang consistently optimized its shareholder structure and introduced strategic investors such as Industrial Bank and Beijing Automotive Group to enhance its brand image. Bank of Jiujiang ranks 322nd among banks worldwide, which is 5 places higher than the previous year according to the rankings published in 2020 by The Banker, a globally authoritative journal in the United Kingdom. The Bank has also received numerous recognition including “National Advanced Grassroots Party Organization”, “National May Day Labour Award”, “Best National Small and Medium Commercial Bank” and “Exemplary Workplace for Talents in Jiangxi Province”. As of June 30, 2020, Bank of Jiujiang (including controlled county banks) has 3,878 full-time employees, with an average age of 29.87. Among which, 3,414 had undergraduate degrees or graduated from junior college, accounting for 88.03%, while 449 had master’s degrees (and above), accounting for 11.58%. We now have operation department of the head office, 13 branches and 260 sub-branches, established 20 county banks such as Xiushui Jiuyin and Zhongshan Xiaolan. As a city commercial bank, Bank of Jiujiang was the first to realize the full coverage of districts and cities within Jiangxi Province. Bank of Jiujiang positions itself as a regional commercial bank rising in an area in the middle of Nanjing and Wuhan and with neighboring Guangzhou and Hefei on two sides, in a bid to be “Rooted in Jiujiang and Centered in Jiangxi Province, Spreading business across the country and Striding towards the world” and eventually forge a “gold cross” composed of the economic belts in the middle reach of Yangtze River and along the Beijing-Kowloon Railway. It has now grown into a financial brand name from Jiangxi, a headstream of China’s modern revolution. 3 BANK OF JIUJIANG Company Profile 3. Major awards in the first half of 2020 On January 3, 2020, the Bank was awarded with the “core dealer” of the inter-bank local currency market in 2019 and the X-REPO trading mechanism innovation award. On January 15, 2020, the Bank was awarded “Top 100 Clearing Companies of 2019 – Excellent Dealer” and was first awarded “Best Improvement Institute for Local Debt Underwriting Banks”. On January 16, 2020, the Bank was awarded the “UnionPay Card – Excellent Contribution in Product Promotion" by China UnionPay Co., Ltd.. In March 2020, Shanghai Clearing House announced outstanding institutions in settlement and central counterparty clearing businesses in the year of 2019, and the Bank was awarded the “Excellent Award for Net Bond Sole Settlement” for the second consecutive year. On March 9, 2020, in the “Top 100 China Banks Rankings of 2019” published by the China Banking Association, the Bank ranked 52nd in the China bank list, raised by 10 places compared to the previous year. In April 2020, the Bank was awarded two awards, namely “Improvement Award” on Promotion Award on QuickPass users, and “Excellence Award” on establishing the practice of QuickPass on public buses issued by China UnionPay’s Jiangxi branch. On April 27, 2020, The Export-Import Bank of China announced the list of institutions with outstanding performances in financial bonds underwriting and market making transactions in the last quarter of 2019 and the first quarter of 2020. The Bank ranked first in market making transactions and 11th in underwriting performance. On May 13, 2020, the Bank ranked 1,825th in the top 2,000 global enterprises in 2020 released by Forbes. On May 20, 2020, The Export-Import Bank of China announced the list of 2019 domestic RMB financial bond underwriting awards, in which the Bank was awarded three awards, namely “Excellent Underwriter", “Excellent Market Making Trader” and “Contribution Award on Recovery from the Epidemic". 2020 INTERIM REPORT 4 Accounting Data and Financial Indicator Highlights The financial information of the Bank and its subsidiaries (hereinafter collectively referred to as the “Group”) set forth in this interim report is prepared on a consolidated basis in accordance with International Financial Reporting Standards (“IFRS”) and expressed in Renminbi (“RMB”) unless otherwise stated. For the six months ended June 30, Change over the corresponding period 2020 2019 of last year (All amounts expressed in millions of RMB except percentages, unless otherwise stated) Percentage of Results of operations change (%) Net interest income 3,859.6 3,343.1 15.4 Net fee and commission income 333.7 143.5 132.5 Operating income 5,130.2 4,670.4 9.8 Operating expenses (1,151.0) (1,173.8) (1.9) Impairment losses on assets (2,680.0) (2,172.5) 23.4 Profit before taxation 1,305.7 1,330.9 (1.9) Profit for the period 1,092.6 1,085.9 0.6 Net profit attributable to equity shareholders of the Bank 1,014.3 1,063.8 (4.7) Calculated on a per share basis Percentage of (RMB/share) change (%) Net assets per share attributable to the Bank’s shareholders 10.58 9.93 6.5 Basic earnings per share 0.42 0.44 (4.5) Diluted earnings per share 0.42 0.44 (4.5) Changes (percentage Profitability indicators (%) point) Return on average total assets(1) 0.58 0.65 (0.07) Return on average equity(2) 8.48 9.04 (0.56) Net interest spread(3) 2.07 2.43 (0.36) Net interest margin(4) 2.11 2.25 (0.14) Net fee and commission income to operating income 6.50 3.07 3.43 Cost-to-income ratio(5) 21.40 24.25 (2.85) 5 BANK OF JIUJIANG Accounting Data and Financial Indicator Highlights As of As of Change over the June 30, 2020 December 31, 2019 end of last year (All amounts expressed in millions of RMB except percentages, unless otherwise stated) Changes Capital adequacy indicators (%)