diff --git "a/China/10.Bank of China_$175.50 B_Financials/2021/results.txt" "b/China/10.Bank of China_$175.50 B_Financials/2021/results.txt"
new file mode 100644--- /dev/null
+++ "b/China/10.Bank of China_$175.50 B_Financials/2021/results.txt"
@@ -0,0 +1,27810 @@
+Best Transaction Bank for Trade Finance
+MANAGEMENT DISCUSSION AND ANALYSIS
+MESSAGE FROM THE CHAIRWOMAN OF THE BOARD OF SUPERVISORS
+MESSAGE FROM THE PRESIDENT
+MESSAGE FROM THE CHAIRMAN
+CORPORATE INFORMATION
+FINANCIAL HIGHLIGHTS
+IMPORTANT NOTICE
+DEFINITIONS
+HONOURS AND AWARDS
+CORPORATE CULTURE CONCEPT SYSTEM
+OUTLINE OF 14TH FIVE-YEAR DEVELOPMENT PLAN (2021-2025) AND
+LONG-RANGE OBJECTIVES THROUGH THE YEAR 2035
+INTRODUCTION
+Contents
+4
+2021 Forbes China's Most Popular Employers
+for College Students
+Ranked 3rd in the List of Brands with Most
+Historical and Cultural Heritage in China
+Best and Most Attractive Employer for College
+Student
+Ranked 6th in the List of Chinese Brands with
+Best Value
+Best Board of Directors for Investor Relations
+Annual Report Gold Award
+Best Corporate Mobile Banking Award
+IDC Financial Industry Technology Application
+Scenario Innovation Award
+2021 Most Influential Digitalised Bank
+Best Bank in Wealth Management
+Outstanding Inclusive Finance Bank of the Year
+Best Bank with Responsible Investment
+Outstanding Contribution Award of the
+Intermediary Business Professional Committee
+Excellent Case of Financial Services for Micro,
+Small and Medium-sized Enterprises
+Shanghai Futures Exchange Gold Award for
+Market Making Business
+Best Sustainable Finance Issuer
+Best Debt House-Asia
+FINANCIAL REVIEW
+BUSINESS REVIEW
+OVERVIEW OF STRATEGIC PROGRESS
+COMMERCIAL BANKING IN THE CHINESE MAINLAND
+OUTLOOK
+113
+KEY ISSUES OF CONCERN TO THE CAPITAL MARKET
+108
+HUMAN RESOURCES DEVELOPMENT AND MANAGEMENT
+ORGANISATIONAL MANAGEMENT,
+CAPITAL MANAGEMENT
+RISK MANAGEMENT
+106
+93
+90
+87
+77
+ESG Financing Institution of the Year
+22222222F5226
+43
+43
+23
+20
+15
+13
+10
+23469
+1
+INFORMATION TECHNOLOGY DEVELOPMENT
+SERVICE CHANNELS
+COMPREHENSIVE OPERATION
+GLOBALISED OPERATION
+70
+118
+2021 FinTech Innovation Award
+Institutional
+Honours and Awards
+3
+Collaborate for Mutual Growth
+Uphold Openness and Inclusiveness
+Innovate with Prudence
+Provide Excellent Service
+Our Values
+Build a First-Class Global Banking Group
+Our Vision
+Bridge China and the World for the Common Good
+Our Mission
+Corporate Culture Concept System
+2
+Under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New
+Era, the Bank will set foot in the new development stage, take full, accurate and comprehensive
+implementation of the new development philosophy, contribute to the new development pattern.
+With reform and innovation as the fundamental driver and meeting people's growing needs for
+a better life as the fundamental purpose, the Bank will adhere to the general principle of seeking
+progress while maintaining stability, deepen the supply-side structural reform in the financial
+sector, accelerate the comprehensive digital transformation, and promote high-quality and
+sustainable development and high-standard opening-up. The Bank will fulfill its responsibility
+and mission as a large state-owned bank, focus on serving the real economy, and continue to
+promote technology finance, green finance, inclusive finance, cross-border finance, consumer
+finance, wealth finance, supply chain finance and county-level finance. The Bank will strengthen
+risk awareness, stick to the bottom-line thinking, and strengthen prudence and compliance in
+operation. The Bank will maintain a systematic concept and accelerate the building of a strategic
+development pattern with its domestic commercial banking services as the business mainstay and
+its globalised operations and diversified business platforms as two growth engines. The Bank will
+take the strategic approach of “invigorate, adapt to change and drive for major breakthroughs",
+and thus strive to build a first-class global banking group.
+Outline of 14th Five-Year Development Plan (2021-2025)
+and Long-Range Objectives through the Year 2035
+1
+Bank of China embodies a noble sense of duty and commitment. Over its 110 years history, the
+Bank constantly cared about the nation, dedicated to contribute to the country, and continued
+to strive for prosperity of the country and rejuvenation of the nation. Being deeply rooted in
+people and committed to providing excellent services, it has fulfilled its responsibilities of
+delivering financial services for the people, bringing benefits and convenience to the people,
+and improving the living standards of the people. Keeping the common good in mind and
+advocating openness and inclusiveness, the Bank has mobilised domestic and overseas resources
+to serve the two-way interactions between China and the world. It has always followed the
+law, innovated with prudence, and upheld the spirit of integrity and innovation to strengthen
+the Bank. As a large state-owned commercial bank on a new journey towards fully building
+a modern socialist country, the Bank, under the guidance of Xi Jinping Thought on Socialism
+with Chinese Characteristics for a New Era, will carry forward the Bank's century-old tradition
+of pursuing excellence, take full, accurate and comprehensive implementation of the new
+development philosophy, contribute to the new development pattern; consciously uphold the
+mission of “Bridge China and the World for the Common Good”; practice the values of “provide
+excellent service, innovate with prudence, uphold openness and inclusiveness, collaborate for
+mutual growth", take the strategic approach of “invigorate, adapt to change and drive for major
+breakthroughs”, and thus strive to build a first-class global banking group, promote higher-
+standard opening-up and high-quality economic and social development, and make an even
+greater contribution to realising the Chinese Dream of national rejuvenation.
+As China's most globalised and integrated bank, Bank of China has institutions across the
+Chinese mainland as well as 62 countries and regions, and BOCHK and the Macau Branch
+serve as local note-issuing banks in their respective markets. The Bank has a well-established
+global service network and an integrated service platform based on the pillars of its corporate
+banking, personal banking, financial markets and other commercial banking business, which
+covers investment banking, direct investment, securities, insurance, funds, aircraft leasing, asset
+management, financial technology, financing leasing and other areas, thus providing its customers
+with financial solutions featuring one-click access, global response and integrated services.
+Bank of China is the bank with the longest continuous operation among Chinese banks. Formally
+established in February 1912, the Bank served consecutively as the country's central bank,
+international exchange bank and specialised international trade bank. After 1949, drawing
+on its long history as the state-designated specialised foreign exchange and trade bank, the
+Bank became responsible for managing China's foreign exchange operations and offering
+international trade settlement, overseas fund transfer and other non-trade foreign exchange
+services. Restructured into a wholly state-owned commercial bank in 1994, the Bank provides
+various financial services, and has developed into a large commercial bank delivering services
+in local and foreign currencies and featuring complete business varieties and strong strength.
+The Bank was listed on the Hong Kong Stock Exchange and the Shanghai Stock Exchange in
+2006, becoming the first Chinese bank to launch an A-Share and H-Share initial public offering
+and achieve a dual listing in both markets. The Bank is the official banking partner of the
+Beijing 2008 Summer Olympics and the Beijing 2022 Winter Olympics, thus making it the only
+bank in China to serve two Olympic Games. In 2011, Bank of China became the first financial
+institution from an emerging economy to be designated as a Global Systemically Important Bank,
+a designation it has now maintained for 11 consecutive years. With its growing international
+status, competitiveness and comprehensive strengths, the Bank has marched forward into the
+ranks of the world's large banks. In 2022, Bank of China, in celebration of its 110th anniversary
+of establishment, is striving to form a strategic landscape with its domestic commercial banking
+services as the business mainstay, its globalised operations and diversified business platforms as
+the two growth engines, accelerate the building of a first-class global banking group and working
+hard to write a new chapter in its history of more than hundred years.
+Introduction
+The print version of the Bank's 2021 Annual Report, to be published in April 2022, will
+supersede this version.
+2021 Annual Report
+Stock Code: 3988 (Ordinary H-Share)
+4619 (Offshore Preference Share)
+Bank of China Limited
+1912-2022
+BANK OF CHINA
+BOC
+The Banker
+FORTUNE
+Global Finance
+Asiamoney
+Annual Award
+Global Green Finance Awards
+Best Transaction Bank for Supply Chain Finance
+Best Bank for Domestic Debt Capital Market
+Best Green Bond Bank
+Best Sustainable Finance Bank
+Best Private Bank
+Ranked 39th in Global 500 (2021)
+Ranked 4th in Top 500 Global Banking Brands
+Ranked 4th in Top 1,000 World Banks
+Forbes
+ChinaHR.com
+Hurun Research Institute
+China's Best Investment Advisory Service
+Interbrand
+CFCA
+IDC
+Caijing
+CBN
+Sina
+China Internet Information Center
+China Banking Association, China
+Association of Small and
+Medium Enterprises
+China Banking Association
+Shanghai Futures Exchange
+The Asset
+FinanceAsia
+The Asian Banker
+IFF
+Securities Times
+LACP
+中國銀行
+ENVIRONMENTAL AND SOCIAL RESPONSIBILITIES
+CHANGES IN SHARES AND SHAREHOLDINGS OF SHAREHOLDERS
+Chinese Accounting Standards
+China Banking and Insurance Regulatory Commission
+The area including, for the purpose of this report, the
+branches of Henan, Hubei, Hunan, Guangdong, Shenzhen,
+Guangxi and Hainan
+The Company Law of PRC
+China Securities Regulatory Commission
+The area including, for the purpose of this report, the
+branches of Shanghai, Jiangsu, Suzhou, Zhejiang, Ningbo,
+Anhui, Fujian, Jiangxi, Shandong and Qingdao
+Hong Kong Exchanges and Clearing Limited
+The Rules Governing the Listing of Securities on The
+Stock Exchange of Hong Kong Limited
+The Stock Exchange of Hong Kong Limited
+Overseas-listed foreign investment share(s) in the ordinary
+share capital of the Bank, with a nominal value of
+RMB1.00 each, which are listed on the Hong Kong Stock
+Exchange and traded in Hong Kong dollars (Stock Code:
+3988)
+Central Huijin Investment Ltd.
+International Financial Reporting Standards
+7
+Independent Director
+MOF
+Northeastern China
+Northern China
+PBOC
+PRC
+RMB
+SAFE
+SFO
+SSE
+Western China
+Independent director under the listing rules of SSE and the
+Articles of Association, and independent non-executive
+director under the Hong Kong Listing Rules
+Ministry of Finance, PRC
+The area including, for the purpose of this report, the
+branches of Heilongjiang, Jilin, Liaoning and Dalian
+BOC Wealth Management Co., Ltd.
+BOC-Samsung Life Ins. Co., Ltd.
+BOC Financial Leasing Co., Ltd.
+BOC International (China) Co., Ltd., a company
+incorporated in the Chinese mainland, the ordinary shares
+of which are listed on the Shanghai Stock Exchange
+BOC Fullerton Community Bank
+Bank of China Insurance Company Limited
+BOC Group Life Assurance Co., Ltd.
+Bank of China Group Insurance Company Limited
+Bank of China Group Investment Limited
+Bank of China (Hong Kong) Limited, an authorised
+financial institution incorporated under the laws of
+Hong Kong and a wholly-owned subsidiary of BOCHK
+(Holdings)
+BOC Hong Kong (Holdings) Limited, a company
+incorporated under the laws of Hong Kong, the ordinary
+shares of which are listed on the Hong Kong Stock
+Exchange
+6
+BOCI
+BOCIM
+BOCI China
+BOCL
+BOC-Samsung Life
+The area including, for the purpose of this report, the
+branches of Beijing, Tianjin, Hebei, Shanxi, Inner
+Mongolia and the Head Office
+BOC Wealth Management
+CBIRC
+Central and Southern China
+Company Law
+CSRC
+Eastern China
+HKEX
+Hong Kong Listing Rules
+Hong Kong Stock Exchange
+H Share
+Huijin
+IFRS
+BOC International Holdings Limited
+Bank of China Investment Management Co., Ltd.
+CAS
+120
+The People's Bank of China, PRC
+Renminbi, the lawful currency of PRC
+Basis Point (Bp, Bps)
+A Share
+Articles of Association
+The Bank/the Group
+In this report, unless the context otherwise requires, the following terms shall have the meaning
+set out below:
+Definitions
+5
+457
+456
+452
+209
+197
+195
+189
+178
+157
+139
+LIST OF MAJOR BRANCHES AND SUBSIDIARIES
+ORGANISATIONAL CHART
+REFERENCE FOR SHAREHOLDERS
+CONSOLIDATED FINANCIAL STATEMENTS
+INDEPENDENT AUDITOR'S REPORT
+REPORT OF THE BOARD OF SUPERVISORS
+REPORT OF THE BOARD OF DIRECTORS
+DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT MEMBERS
+CORPORATE GOVERNANCE
+SIGNIFICANT EVENTS
+131
+BOC Asset Investment
+BOC Aviation
+BOC Consumer Finance
+BOC Financial Technology
+State Administration of Foreign Exchange, PRC
+Securities and Futures Ordinance (Chapter 571 of the
+Laws of Hong Kong)
+The Shanghai Stock Exchange
+The area including, for the purpose of this report, the
+branches of Chongqing, Sichuan, Guizhou, Yunnan,
+Shaanxi, Gansu, Ningxia, Qinghai, Tibet and Xinjiang
+8
+Important Notice
+The Board of Directors, the Board of Supervisors, directors, supervisors and senior management
+members of the Bank warrant that the information in this report is authentic, accurate and
+complete, contains no false record, misleading statement or material omission, and jointly and
+severally accept full responsibility for the information in this report.
+The 2021 Annual Report and Annual Results Announcement of the Bank have been reviewed
+and approved at the meeting of the Board of Directors of the Bank held on 29 March 2022. The
+number of directors who should attend the meeting is 14, with 14 directors attending the meeting
+in person. All of the 14 directors of the Bank exercised their voting rights at the meeting. The
+supervisors and senior management members of the Bank attended the meeting as non-voting
+attendees.
+The 2021 financial statements prepared by the Bank in accordance with CAS and IFRS have
+been audited by PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers in
+accordance with Chinese and international auditing standards, respectively. Both auditors issued
+an unqualified opinion.
+Legal Representative and Chairman of the Board of Directors of the Bank LIU Liange, Vice
+chairman of the Board of Directors and President of the Bank LIU Jin, who is also responsible
+for the Bank's finance and accounting, and General Manager of the Financial Management
+Department WU Jianguang, warrant the authenticity, accuracy and completeness of the financial
+statements in this report.
+The Board of Directors has recommended a final dividend on ordinary shares for 2021 of
+RMB2.21 per ten shares (before tax), subject to approval in the forthcoming 2021 Annual
+General Meeting. No capitalisation of the capital reserve to share capital is proposed in this profit
+distribution.
+During the reporting period, there was no misappropriation of the Bank's funds by its controlling
+shareholder or other related parties for non-operating purposes and no material guarantee business
+that has violated the applicable regulations and procedures.
+This report may contain forward-looking statements that involve risks and future plans. These
+forward-looking statements are based on the Bank's own information and information from other
+sources that the Bank believes to be reliable. They relate to future events or the Bank's future
+financial, business or other performance and are subject to a number of factors and uncertainties
+that may cause the actual results to differ materially. Any future plans mentioned do not
+constitute a substantive commitment by the Bank to its investors. Investors and people concerned
+should be fully aware of the risks and understand the differences between plans, forecast and
+commitment.
+The People's Republic of China
+The Bank is faced with risks arising from changes in the macroeconomic environment and from
+political and economic conditions in different countries and regions as well as risks arising from
+its day-to-day operations, including the risk arising from changes in the credit status of borrowers,
+adverse changes in market prices and operational risk. It shall at the same time meet regulatory
+and compliance requirements. The Bank actively adopts adequate measures to effectively manage
+all types of risks. Please refer to the section “Management Discussion and Analysis Risk
+Management" for details.
+BOC Aviation Limited, a public company limited by
+shares incorporated in Singapore under the Singapore
+Companies Act, the shares of which are listed on the Hong
+Kong Stock Exchange
+BOC Financial Asset Investment Co., Ltd.
+Measurement unit of changes in interest rate or exchange
+rate. 1 basis point is equivalent to 0.01 percentage point
+Domestic investment share(s) in the ordinary share capital
+of the Bank, with a nominal value of RMB1.00 each,
+which are listed on SSE (Stock Code: 601988)
+The performing Articles of Association of the Bank
+Bank of China Limited or its predecessors and,
+except where the context otherwise requires, all of the
+subsidiaries of Bank of China Limited
+BOCHK (Holdings)
+BOCHK
+BOCG Investment
+BOCG Insurance
+BOC Life
+BOC Insurance
+BOC Fullerton Community Bank
+9
+BOC Financial Technology Co., Ltd.
+BOC Consumer Finance Co., Ltd.
+32.66
+Loss
+86,284
+0.55%
+48,332
+0.34%
+Total
+15,674,994
+100.00%
+0.24%
+14,183,385
+NPLs
+208,792
+1.33%
+207,273
+1.46%
+Chinese mainland
+Pass
+12,586,668
+100.00%
+33,823
+0.39%
+60,718
+% of total
+Amount
+% of total
+Group
+Pass
+Substandard
+Doubtful
+15,255,389
+97.32%
+13,711,518
+96.67%
+Special-mention
+210,813
+1.35%
+264,594
+1.87%
+61,790
+0.39%
+125,118
+0.88%
+97.17%
+11,089,055
+96.41%
+Special-mention
+100.00%
+NPLs
+193,030
+1.49%
+189,985
+1.65%
+Migration Ratio
+Unit: %
+Items
+2021
+2020
+2019
+Pass
+1.18
+1.21
+32.91
+99
+66
+In 2021, the Group's impairment losses on loans and advances stood at RMB98.298 billion, a
+decrease of RMB5.332 billion compared with the prior year. The credit cost was 0.66%, down
+0.10 percentage point compared with the prior year. Specifically, the Bank's institutions in the
+Chinese mainland registered impairment losses on loans and advances of RMB95.308 billion,
+an increase of RMB1.723 billion compared with the prior year. The credit cost of the Bank's
+institutions in the Chinese mainland was 0.78%, down 0.08 percentage point compared with the
+prior year.
+11,501,791
+Amount
+100.00%
+Total
+173,561
+1.34%
+222,751
+1.94%
+Substandard
+53,591
+0.41%
+115,873
+1.01%
+Doubtful
+55,923
+0.43%
+31,078
+0.27%
+Loss
+83,516
+0.65%
+43,034
+0.37%
+12,953,259
+As at 31 December 2020
+As at 31 December 2021
+Unit: RMB million, except percentages
+The Bank developed the new IT infrastructure to enhance its digital foundations. It made
+every effort to promote the OASIS project, strengthened the top-level design of enterprise-
+level business architecture and IT architecture, and established the concept of enterprise-level
+middle office development. In addition, it improved capacity for Group-wide sharing and reuse,
+and enhanced support for both strategic objectives and agile responses related to business
+development, product innovation and market changes. The feasibility studies, business modelling,
+and IT development and testing of the first group of projects in the first phase were completed,
+with the Bank now having entered the production preparation stage. Significant progress was
+made in the development of basic technology platforms, with many of them put into production,
+including the independently developed enterprise-level distributed technology platform "Hong
+Hu", the DevOps cloud platform "Fu Yao", the smart operation and maintenance platform “Jiu
+Tian", the mobile development framework "Han Hai” and the big data development framework
+"Xing Han". As a result, the fundamental support capacity, independent control capacity and
+agile development capacity of the Bank's scientific and technological strengths were significantly
+improved, and preliminary achievements were made in the transformation towards a platform-
+based, service-oriented and standardised IT framework.
+The Bank accelerated technological empowerment to improve the quality and development pace
+of its businesses. It launched its Mobile Banking Version 7.0, developed the features of “finance
++ scenario", "technology + care”, “intelligent + professional” and “global + panorama”, and
+built an integrated marketing service platform, thus creating a closed-loop digital marketing
+system. The BOC Intelligent Global Transaction Banking service platform (iGTB platform), an
+online, intelligent and open portal offering integrated financial services for corporate banking
+customers, began to take shape, realising online processing for cross-border remittance, supply
+chain finance and other services. The Bank continued to enrich its online inclusive finance
+products, with its online inclusive financing balance growing more than 26 times compared with
+the prior year-end. Its quantitative trading platform was certified as a qualified trading institution
+by the Foreign Exchange Trade System, and precious metals, foreign exchange settlement, cash
+securities and RMB interest rate swap (IRS) businesses were put into operation through the
+platform. To prevent and mitigate telecom and online fraud, the Bank continued to optimise the
+risk monitoring and interception model of its "Cyber Defence" smart risk control and prevention
+system for bank accounts involved in fraud, with an average daily monitoring volume of
+hundreds of millions of transactions. A centralised operations platform was promoted across the
+Bank, realising the unified sharing of processes, data and risk control, with business processing
+efficiency increasing by more than 60%. The mobile office platform “BOC Messaging" had 280
+thousand users and supported 217 applications, realising online organisation, communication
+and processes, and significantly improving the capacity of the Bank's online collaborative office
+function.
+91
+The Bank built an open financial ecosystem and promoted business model innovation. Focusing
+on cross-border facilitation, education, sports, silver economy and other scenarios related to
+people's livelihood, it reached over 100 million users in total. Moreover, it launched the "BOC
+Cross-border Services” APP and "BOC Compass" applets for non-residents, further consolidating
+the special advantages of its cross-border ecosystem. The BOC University for the Elderly was
+launched, attracting a total of 800,000 views, making a positive contribution to serving elderly
+customers. The total number of headquarters-level merchants linked to the Bank's mobile
+banking service continuously increased. The growth rate of monthly active transaction users
+ranked top among major peers.
+The Bank deepened the application of new technologies and highlighted the value of
+technological transfer. It further enriched its enterprise-level AI technology service system
+and built the five platforms of machine learning, biometrics, voice recognition, robotics and
+knowledge base, which were widely applied in business areas such as intelligent operations,
+intelligent marketing, intelligent investment and intelligent risk control. The data governance
+framework was basically completed, realising “unified data, unified architecture and unified
+ecosystem". The Bank's data lake and data warehouse have now accumulated about 15PB of data
+assets, and it provided analyst platforms, unified data portals and other services. The Bank's data
+analysis and mining capabilities achieved a closer fit to the frontline requirements of business
+and customer services, and the potential of data elements was further realised. The blockchain
+technology platform continued to be upgraded and 15 patents were granted, supporting business
+applications such as cross-border settlement, trade finance, people's livelihood, poverty
+alleviation and bond issuance. Moreover, the Bank applied advanced technologies such as 5G
+messaging, foreign language translation and service robots in innovative ways to support the
+smart and green Winter Olympics.
+Six of the Bank's technological achievements won PBOC Financial Technology Development
+Awards, among which the overseas distributed core banking project was granted the first prize.
+The cumulative number of patent applications reached 4,569, with 194 patents granted in 2021,
+placing the Bank first among its domestic peers in terms of patent quality, influence and R&D
+capability.
+92
+22
+RISK MANAGEMENT
+The Bank continued to improve its risk management system in line with the Group's strategies
+and refine its risk management structure, mechanism, process, tools and foundations, thus
+ensuring the sustainable and robust operation of the Group. Anticipating how risk management
+will develop over the next three to five years, the Bank formulated the Group's 14th Five-year
+Plan and action scheme for the Group's risk management. In addition, it followed regulatory
+requirements and responded positively to the implementation of Basel III and international
+benchmark interest rate reform. It also enhanced rectification accountability to ensure compliance
+in operations. The Bank intensified the risk control of overseas institutions and comprehensive
+operation companies and facilitated the development of the “Two Engines". It continuously
+investigated major potential risks, established a multi-tier smart risk control and early warning
+system, and enhanced its capabilities in identifying, warning, discovering and disposing of
+risks at an earlier stage. Furthermore, the Bank launched risk data governance and accelerated
+the digital transformation of risk management. It actively carried out special campaigns on risk
+culture, in order to cultivate a risk culture that supports its sustainable development.
+The risk management framework of the Bank is set forth below:
+Board of Directors
+Strategic Development Committee
+Responsible Vice Presidents
+Customer Relationship
+Departments
+Product Management
+Departments
+President
+Risk Policy Committee
+The Bank improved its technological governance structure to push forward transformation
+and development in a coordinated manner. It set up the Financial Digitalisation Committee
+to push forward the development of the Group's digitalisation, FinTech, data governance, IT
+risk management system, etc. To optimise the layout of its R&D institutions, BOC Financial
+Technology set up R&D bases in Wuhan, Hubei Province; Chengdu, Sichuan Province; and
+Hainan Province in 2021, so as to support the development of key regions and shoulder
+responsibility for the implementation of scenarios such as "finance + industry" and "finance +
+government affairs".
+US Risk and Management Committee
+90
+The Bank adapted to FinTech development trends by strengthening top-level design. It formulated
+the 14th Five-Year Plan of BOC for FinTech in accordance with the strategic requirements for
+all-round digital transformation contained in the Group's 14th Five-Year Plan. Based on the main
+priorities of "consolidating foundational support, empowering business development and laying
+out future capabilities", the plan took data as the driving force and FinTech as the means to
+transform the traditional commercial banking mode, and promoted the reshaping of the Group's
+marketing, products, channels, operations, services, risk control and management, thus building
+the "Digital BOC".
+system and developed featured outlet development plans based on local conditions. It also built
+outlets with unique features based on the "Eight Priority Areas for Enhancing Financial Services
+Capabilities”, including technology finance, green finance, inclusive finance and cross-border
+services, etc., as well as demonstration outlets for education, sports and elderly services. It
+refined its differentiated outlet resource allocation strategy, and improved outlets' capabilities for
+integrating into scenario-based ecosystems and realising value creation.
+The Bank enhanced its enterprise-level intensive operation capacity. It upgraded its intensive
+operations platform and rolled it out across its domestic branches, improved the production lines
+in its operation centres, completed the first batch of business centralisation, and sped up the
+development of an intensive and shared smart operation service system.
+As at the end of 2021, the Bank's commercial banking network in the Chinese mainland
+(including Head Office, tier-1 branches, tier-2 branches and outlets) comprised 10,382 branches
+and outlets. Its comprehensive operation institutions in the Chinese mainland totalled 520, and
+the number of its institutions in Hong Kong (China), Macao (China), Taiwan (China) and other
+countries and regions totalled 550.
+Items
+ATM
+Smart counter
+Unit: single item, except percentages
+As at
+As at
+31 December
+31 December
+2021
+2020
+Change (%)
+27,729
+33,314
+32,367
+31,960
+(16.76%)
+1.27%
+Information Technology Development
+Committed to enhancing its competitiveness in “technology + ecosystem + experience + data"
+in the digital economy era, the Bank accelerated its digital transformation, cultivated new
+technology-led growth drivers, and created new financial services patterns. In 2021, the number
+of employees in the IT line of the Bank stood at 12,873, accounting for 4.20% of the total, of
+which 8,189 were employees of domestic commercial banks, accounting for 3.07% of the total.
+These employees had an average age of 37, with 94% holding Bachelor's degrees or above. The
+Bank invested RMB 18.618 billion in information technology during the year.
+90
+The Bank makes timely and adequate allowances for loan impairment losses based on the
+expected credit loss (ECL) module in accordance with the principles of authenticity and forward-
+lookingness. Please refer to Notes II.4 and VI.2 to the Consolidated Financial Statements for the
+accounting policy in relation to allowances for impairment losses.
+Chief Risk Officer
+Audit Committee
+of the Group
+Subsidiaries
+Credit Risk Management
+Closely monitoring changes in macroeconomic and financial conditions, the Bank pushed forward
+the optimisation of its credit structure, improved its credit risk management policies, strengthened
+credit asset quality management and took a more proactive and forward-looking stance on risk
+management.
+93
+93
+The Bank continuously optimised its credit structure. Aiming to advance strategic implementation
+and balance risk, capital and return, it pushed forward the establishment of an industrial policy
+system, formulated industry guidelines for credit granting, and improved the management scheme
+for its asset portfolios. In line with the 14th Five-year Plan of the country and that of the Bank,
+as well as requirements for the development of the "Eight Priority Areas for Enhancing Financial
+Services Capabilities”, the Bank highlighted the four segments of scientific and technological
+innovation, domestic demand expansion, regional coordination and infrastructure construction.
+It also focused on the ten pillars of strategic emerging industries, new infrastructure, advanced
+manufacturing, digital economy, people's livelihood consumption, modern services, rural
+revitalisation, new urbanisation, traditional infrastructure and traditional manufacturing.
+The Bank strengthened its unified credit granting management and enhanced full-scope
+centralised credit risk management. It continuously improved its long-acting credit management
+mechanism and asset quality monitoring system, strengthened the control of customer
+concentration risk, and further upgraded the effectiveness of potential risk identification, control
+and mitigation. The Bank enhanced the supervision of risk analysis and asset quality control in
+key focus regions, and strengthened the window guidance, inspection and post-assessment on its
+business lines. In addition, it constantly identified, measured and monitored large exposures in
+line with related large exposure management requirements.
+In terms of corporate banking, the Bank further strengthened risk identification, control and
+mitigation in key fields, strictly controlled the aggregate amount and orientation of loans through
+limit management, and prevented and mitigated risk associated with projects in high energy
+consumption and high carbon emission industries. In addition, it implemented the government's
+macro-control policies and regulatory measures in the real estate sector to strengthen the risk
+management of real estate loans. In terms of personal banking, the Bank improved its personal
+credit approval mechanism, strengthened authorisation management, and refined approver
+management. It set strict access standards, enhanced process monitoring and prevented excessive
+credit risk and the cross-spreading of risks while supporting the development of its personal credit
+business.
+The Bank stepped up efforts in the mitigation of NPAs, consolidated asset quality, and prevented
+and resolved financial risks. It continued to adopt the tiered and classified management of NPA
+projects to drive for major breakthroughs and improve the quality and efficiency of disposal.
+The Bank expanded disposal channels, and applied the pilot regulatory policy on NPA transfer,
+achieved breakthroughs in single corporate transfers and batch individual transfers. It also
+intensified the securitisation of non-performing personal and bank card assets, with disposals
+reaching a record high.
+94
+24
+The Bank scientifically measured and managed the quality of credit assets based on the
+Guidelines for Loan Credit Risk Classification, which requires Chinese commercial banks to
+classify loans into the following five categories: pass, special-mention, substandard, doubtful and
+loss, among which loans classified as substandard, doubtful and loss are recognised as NPLs. In
+order to further refine its credit asset risk management, the Bank used a 13-tier risk classification
+criteria scheme for corporate loans to companies in the Chinese mainland, covering on-balance
+sheet and off-balance sheet credit assets. In addition, the Bank strengthened risk classification
+management of key industries, regions and material risk events, and dynamically adjusted
+classification results. It strengthened the management of loan terms, managed overdue loans by
+the name list system and made timely adjustments to risk classification results, so as to truly
+reflect asset quality.
+As at the end of 2021, the Group's NPLs totalled RMB208.792 billion, an increase of RMB1.519
+billion compared with the prior year-end. The NPL ratio was 1.33%, a decrease of 0.13
+percentage point compared with the prior year-end. The Group's allowance for impairment losses
+on loans and advances was RMB390.541 billion, an increase of RMB21.922 billion compared
+with the prior year-end. The coverage ratio of allowance for loan impairment losses to NPLs was
+187.05%, an increase of 9.21 percentage points compared with the prior year-end. The NPLs
+of the Bank's institutions in the Chinese mainland totalled RMB 193.030 billion, an increase of
+RMB3.045 billion compared with the prior year-end. The NPL ratio of the Bank's institutions
+in the Chinese mainland was 1.49%, a decrease of 0.16 percentage point compared with the
+prior year-end. The Group's outstanding special-mention loans stood at RMB210.813 billion, a
+decrease of RMB53.781 billion compared with the prior year-end, and accounted for 1.35% of
+total loans and advances, down by 0.52 percentage point from the prior year-end.
+6
+Total loans and advances to customers in the "Risk Management Credit risk management" section are
+exclusive of accrued interest.
+95
+Five-category Loan Classification
+Items
+Branches &
+Risk Management and
+Management Departments
+Directors
+Internal Control Committee
+Asset & Liability Management
+Department
+Department
+Credit Approval
+Department
+Compliance Management
+Internal Control and Legal &
+Department
+Credit Management
+Department
+Risk Management
+Second Line of Defense
+Executive Office
+Board of
+Supervisors
+Chief Audit Officer
+Audit Department
+Third Line of
+Defense
+Management and Responsible Departments of Domestic and Overseas Branches and Comprehensive Operation Subsidiaries
+First Line of Defense
+Board of
+Management
+Senio:
+169,951
+1.40
+20,143
+2.42%
+45.98% 157,767
+10,302,408
+861
+0.66%
+894
+0.95%
+2,319
+1.72%
+0.76% 243,268
+1.39% 136,444 0.96%
+1.32% 39,670 0.28%
+2.20% 6,521,932
+0.52% 4,979,859
+295,183 1.88% 2,257
+159,284 1.02% 2,215
+46,175 0.30%
+608
+7,490,879 47.79% 164,796
+5,462,380 34.85% 28,234
+Personal loans
+35.11%
+Total
+Public utilities
+administration
+public utility
+environment and
+Water conservancy,
+1.74%
+3,806
+1.54%
+3,406 1.28% 218,541
+2.78%
+4,537
+1.15%
+Others
+32,218
+0.65%
+Hong Kong (China),
+100,392
+86,583
+Increase during the year
+166,952
+178,235
+207,273
+Balance at the beginning of the year
+Group
+2019
+2020
+2021
+Unit: RMB million
+Items
+Movement of Credit-impaired Loans
+98
+As at the end of 2021, the Group's credit-impaired loans totalled RMB208.792 billion, an
+increase of RMB1.519 billion compared with the prior year-end. The credit-impaired loans
+to total loans ratio was 1.33%, a decrease of 0.13 percentage point compared with the prior
+year-end. Credit-impaired loans of the Bank's institutions in the Chinese mainland totalled
+RMB 193.030 billion, an increase of RMB3.045 billion compared with the prior year-end. The
+credit-impaired loans to total loans ratio of the Bank's institutions in the Chinese mainland
+was 1.49%, a decrease of 0.16 percentage point compared with the prior year-end. The Bank's
+operations in Hong Kong (China), Macao (China), Taiwan (China) and other countries and
+regions reported credit-impaired loans of RMB 15.762 billion and a credit-impaired loans to total
+loans ratio of 0.58%, a decrease of RMB1.526 billion and 0.06 percentage point, respectively,
+compared with the prior year-end.
+In accordance with IFRS 9, the Bank assesses expected credit losses with forward-looking
+information and makes relevant allowances. In particular, it makes allowances for assets
+classified as Stage 1 and assets classified as Stage 2 and Stage 3 according to the expected
+credit losses over 12 months and the expected credit losses over the entire lifetime of the asset,
+respectively. As at the end of 2021, the Group's Stage 1 loans totalled RMB 15,207.789 billion,
+accounting for 97.04% of total loans; Stage 2 loans totalled RMB255.214 billion, accounting for
+1.63% of total loans; and Stage 3 loans totalled RMB208.186 billion, accounting for 1.33% of
+total loans.
+The Bank continued to optimise the credit structure and stepped up efforts to support the real
+economy. As at the end of 2021, loans for transportation, storage and postal services industry
+totalled RMB 1,578.645 billion, an increase of RMB265.188 billion or 20.19% compared with the
+prior year-end. Loans for manufacturing industry totalled RMB1,549.639 billion, an increase of
+RMB219.861 billion or 16.53% compared with the prior year-end. The NPL ratios of commerce
+and services industry and manufacturing industry decreased by 1.12 percentage points and 0.69
+percentage point respectively.
+57
+97
+0.64%
+17,288
+207,273 1.46%
+0.58% 2,681,594 18.91%
+1.33% 14,183,385 100.00%
+2,721,735 17.36% 15,762
+15,674,994 100.00% 208,792
+Total of the Group
+Taiwan (China) and
+other countries and
+regions
+Macao (China),
+2.92% 163,193
+0.01%
+42
+3.44%
+9.83%
+1.89% 1,395,690
+30,111
+1,589,119 10.14%
+1,549,639 9.89%
+Manufacturing
+Commerce and services
+Corporate Loans
+Chinese mainland
+NPLs NPL ratio
+Loans % of total
+NPLs NPL ratio
+Loans % of total
+As at 31 December 2020
+As at 31 December 2021
+Unit: RMB million, except percentages
+Distribution of Loans and NPLs by Industry
+96
+96
+18.76
+28.62
+23.06
+Doubtful
+40.86
+24.68
+83.68
+Substandard
+21.45
+42,010
+94,870
+3.01%
+3.57% 1,329,778
+0.04% 487,488
+0.43%
+2,374
+3.91%
+2.00% 554,626
+4.19% 13,173
+3.19%
+201
+161,473 1.03% 4,717
+266,775 1.70%
+Construction
+Mining
+500,380
+Financial services
+657,020
+heating, gas and water
+supply of electricity,
+Production and
+29,952 4.68%
+14,276 1.09%
+9.26%
+1.14% 1,313,457
+5.05% 639,777 4.51%
+18,073
+34,694
+1,578,645 10.07%
+4.38%
+687,186
+Real estate
+postal services
+storage and
+Transportation,
+56,696 4.26%
+9.38%
+55,341
+Decrease during the year
+2.17%
+Balance at the end of the year
+Total loans
+Impaired
+loans
+Items
+Group
+RMB
+12,727,437
+Foreign currency
+2,947,557
+Total
+15,674,994
+170,103 11,313,067
+38,689 2,870,318
+208,792 14,183,385
+164,072
+43,201
+207,273 13,034,189
+150,532
+2,909,106
+27,703
+178,235
+Chinese mainland
+RMB
+12,623,061
+Foreign currency
+Total
+330,198
+12,953,259
+170,102 11,245,545
+22,928 256,246
+193,030 11,501,791
+260,716
+149,808
+10,041,692
+161,651
+28,334
+189,985
+(85,064)
+As at 31 December 2019
+As at 31 December 2020
+Impaired
+loans
+10,125,083
+Impaired
+loans
+(71,354)
+(83,587)
+Total loans
+208,792
+207,273
+178,235
+Chinese mainland
+Balance at the beginning of the year
+189,985
+169,951
+162,778
+Increase during the year
+77,098
+86,209
+Special-mention
+Unit: RMB million
+As at 31 December 2021
+88,658
+Loans and Credit-impaired Loans by Currency
+169,951
+189,985
+Total loans
+Balance at the end of the year
+(81,485)
+(66,175)
+(74,053)
+Decrease during the year
+193,030
+Based on the principles of “matching, comprehensiveness and prudence”, the Bank strengthened
+the management of interest rate risk in the banking book (IRRBB). The Bank's IRRBB
+management strategy is to control risks within an acceptable level by considering factors such as
+the Bank's risk appetite and risk profile, as well as macro-economic and market conditions, so as
+to achieve a reasonable balance between risk and return and thus maximise shareholder value.
+The Bank improved the market risk limit system for its bond investment business and
+strengthened cross-risk management. It continued to strengthen risk control of its securities
+investment activities, bolstered the early warning of domestic bond market default risks and the
+tracking of the Chinese offshore USD bond market, and enhanced its post-investment monitoring
+and early-warning capabilities.
+In terms of exchange rate risk management, the Bank sought to achieve currency matching
+between fund source and application. It controlled its foreign exchange exposure through
+currency conversion and hedging, thus maintaining its exchange rate risk at a reasonable level.
+Management of Interest Rate Risk in the Banking Book
+The Bank followed regulatory requirements and advanced the implementation of the new
+regulatory rules for market risk. It strengthened its market judgement and analysis, and made its
+risk management more flexible, proactive and forward-looking. It strengthened the transmission
+of the market risk appetite mechanism, actively pushed forward risk authorisation management,
+and optimised the mode of limit management. In addition, the Bank intensified efforts in the
+development of a market risk management system, optimised risk measurement models, and
+improved intelligent and refined risk management. It also actively carried out risk investigation
+and strengthened the overall management and control of the Group's market risk. It improved the
+emergency planning system and enhanced its capacity to handle market risk emergencies. Please
+refer to Note VI.3 to the Consolidated Financial Statements for detailed information regarding
+market risk.
+As at 31 December 2021
+RMB USD HKD Other
+(3,846) (816) 160 151
+3,846 816 (160) (151)
+7
+Unit: RMB million
+100
+Items
+Up 25 bps
+Down 25 bps
+The Bank assessed the interest rate risk in the banking book mainly through the analysis of
+interest rate repricing gaps. Based on changes in the market situation, it made timely adjustments
+to the structure of its assets and liabilities, optimised its internal and external pricing strategy or
+implemented risk hedging. Assuming that the yield curves of all currencies were to shift up or
+down by 25 basis points in parallel, the Group's sensitivity analysis of net interest income on all
+currencies is as follows?.
+In response to changes in the market environment, the Bank continued to refine its market risk
+management system in order to control its market risk.
+22,294
+0.14%
+22,000
+No
+0.14%
+0.15%
+23,566
+Z Z Z
+Real estate
+Customer J
+Manufacturing
+Customer I
+postal services
+Customer H Transportation, storage and
+Market Risk Management
+As at 31 December 2020
+RMB USD
+(3,405) (921)
+3,405 921
+Foreign currency
+16
+Liquidity ratio RMB
+≥25
+49.6
+54.5
+54.6
+postal services
+2019
+≥25
+58.6
+60.4
+Liquidity gap analysis is one of the methods used by the Bank to assess liquidity risk. Liquidity
+gap results are periodically calculated, monitored and used for sensitivity analysis and stress
+testing. As at the end of 2021, the Bank's liquidity gap was as follows (please refer to Note VI.4
+to the Consolidated Financial Statements):
+Items
+Overdue/undated
+On demand
+69.9
+31 December
+31 December
+2020
+2021
+Other
+203
+(16)
+(203)
+The Bank attached great importance to the reform of interest rate benchmarks, proactively
+participated in the establishment of the global benchmark rate market by capitalising on its
+advantages in globalised operations, and took a crucial part in the invention and promotion of
+alternative benchmark rate products. It also pressed ahead with the transition of remaining LIBOR
+contracts as scheduled by strengthening customer communication, and the overall transition risk
+is under effective control.
+This analysis includes interest-sensitive off-balance sheet positions.
+101
+Liquidity Risk Management
+The Bank endeavoured to develop a sound liquidity risk management system with the aim of
+effectively identifying, measuring, monitoring and controlling liquidity risk at the institution
+and Group level, including that of branches, subsidiaries and business lines, thus ensuring that
+liquidity demand is met in a timely manner and at a reasonable cost.
+Adhering to an appropriate balance of safety, liquidity and profitability, and following regulatory
+requirements, the Bank improved its liquidity risk management in a forward-looking and
+scientific manner. It enhanced liquidity risk management at the institution and Group level,
+including that of branches, subsidiaries and business lines. It formulated sound liquidity risk
+management policies and contingency plans, periodically re-examined liquidity risk limits,
+upgraded the early warning system for liquidity risk, and strengthened the management of high-
+quality liquid assets in order to strike an appropriate balance between risk and return. In addition,
+the Bank regularly improved its liquidity stress-testing scheme and performed stress tests on a
+quarterly basis. The test results indicated that the Bank had adequate payment ability to cope with
+distressed scenarios.
+As at the end of 2021, the Group's liquidity risk indicator met regulatory requirements. The
+Group's liquidity ratio is shown in the table below (in accordance with the relevant provisions of
+regulatory authorities in the Chinese mainland):
+As at
+As at
+Unit: %
+As at
+Ratio
+Regulatory 31 December
+standard
+HKD
+0.16%
+3-12 months (inclusive)
+No
+Parties or not
+postal services
+Customer A Transportation, storage and
+Industry
+Unit: RMB million, except percentages
+Related Outstanding
+The following table shows the top ten individual borrowers as at the end of 2021.
+Please refer to Notes V.17 and VI.2 to the Consolidated Financial Statements for detailed
+information regarding loan classification, stage determination, credit-impaired loans and
+allowance for loan impairment losses.
+Loan concentration ratio of the ten largest borrowers = total outstanding loans to the top ten borrowers ÷ net
+capital.
+Loan concentration ratio of the largest single borrower = total outstanding loans to the largest single borrower ÷
+net capital.
+2.
+1.
+Notes:
+14.5
+13.9
+12.8
+<50
+3.2
+The Bank continued to focus on controlling borrower concentration risk and was in full
+compliance with regulatory requirements on borrower concentration.
+As at
+As at
+Unit: %
+As at
+Regulatory 31 December 31 December 31 December
+Indicators
+loans
+Standard
+2020
+2019
+Loan concentration ratio of the largest single borrower
+Loan concentration ratio of the ten largest borrowers
+<10
+2.3
+2.8
+2021
+24,300
+% of
+total loans
+60,766
+Transportation, storage and
+Customer G
+postal services
+0.20%
+31,246
+No
+Transportation, storage and
+Customer F
+postal services
+0.23%
+35,320
+No
+0.26%
+40,600
+No
+0.26%
+41,403
+0.39%
+Customer B
+Commerce and services
+Customer C
+Manufacturing
+Customer D
+No
+Transportation, storage and
+Transportation, storage and
+Z Z Z Z
+No
+42,968
+0.27%
+No
+postal services
+Customer E
+23,606
+Over 5 years
+Number
+% of total
+Number
+% of total
+Northern China
+8,044,867
+28.26%
+2,074
+18.11%
+% of total
+62,774
+Northeastern China
+884,049
+3.11%
+899
+7.85%
+Up to 1 month
+7.71%
+Eastern China
+6,217,175
+20.49%
+Total assets
+Items
+Employees
+Leverage Ratio
+As at the end of 2021, the leverage ratio calculated in accordance with the Administrative
+Measures for the Leverage Ratio of Commercial Banks (Revised) and the Capital Rules for
+Commercial Banks (Provisional) is listed below:
+Items
+Net tier 1 capital
+Adjusted on- and off-balance sheet assets
+Leverage ratio
+31 December 2021
+2,173,731
+28,425,377
+Unit: RMB million, except percentages
+As at
+As at
+31 December 2020
+1,992,621
+25,880,515
+7.65%
+7.70%
+Please refer to Supplementary Information II.5 to the Consolidated Financial Statements for
+detailed information.
+107
+ORGANISATIONAL MANAGEMENT, HUMAN RESOURCES
+DEVELOPMENT AND MANAGEMENT
+Organisational Management
+In 2021, focusing on the national “big picture” and the Group's 14th Five-Year Plan, the Bank
+further advanced the reform of its organisational structure and management mechanism. It
+optimised the functional structure of its inclusive finance business, integrated the functions of
+corporate and personal inclusive finance, and set up the Rural Revitalisation Finance Department
+to continuously improve the quality and efficiency of its financial services for the real economy.
+The Bank further pushed forward digital transformation and continuously improved the working
+mechanism and resource guarantee for enterprise-level architecture establishment, strategic
+scenario-building and e-CNY operation, so as to drive high-quality development through
+innovation. In addition, the Bank optimised its comprehensive risk management system, refined
+the functions, responsibilities and operating mechanism of its comprehensive risk management,
+accelerated the digital transformation of risk management, and further improved the effectiveness
+of the Group's comprehensive risk management.
+As at the end of 2021, the Bank had a total of 11,452 institutions worldwide, including 10,902
+institutions in the Chinese mainland and 550 institutions in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions. Its commercial banking business in the Chinese
+mainland comprised 10,382 institutions, including 38 tier-1 and direct branches, 371 tier-2
+branches and 9,972 outlets.
+The geographic distribution of the organisations and employees of the Bank is set forth below:
+Unit: RMB million/unit/person, except percentages
+Assets
+Organisations
+21.84%
+Please refer to Note VI.6 to the Consolidated Financial Statements for detailed information.
+3,484
+91,095
+2,292,838
+8.05%
+130
+1.13%
+5,969
+1.95%
+Elimination
+(1,746,349)
+Total
+Other countries and regions
+26,722,408
+11,452
+100.00%
+306,322
+100.00%
+Note: The proportion of geographic assets was based on data before intra-group elimination.
+108
+Human Resources Development and Management
+The Bank formulated the 14th Five-Year Plan for Talent Development of Bank of China in an
+effort to align with the nation's and the Bank's 14th Five-Year Plans. Focusing on strategic tasks
+such as "One Mainstay, Two Engines”, “Eight Priority Areas for Enhancing Financial Services
+Capabilities", digital transformation, comprehensive risk management and culture development,
+it laid out a plan for talent development and the continued deep reform of personnel development
+systems and mechanisms, in order to stimulate the vitality of employees. It formulated and
+implemented the “Hundred, Thousand and Ten Thousand Talent Programme” for fostering young
+officials, focusing efforts on training, selecting and appointing young officials thus supporting
+their growth. It vigorously strengthened team building for science and technology personnel
+and increased the pool of versatile personnel who were fluent in both science and technology
+and business. It continued to consolidate the features and advantages of its international and
+comprehensive personnel pool and strengthened the training of personnel with minority-language
+abilities. Implementing the national strategic plan of prioritising employment, the Bank initiated
+a global campus recruitment programme and continued to expand the scale of its recruitment
+so as to ensure stable employment for college graduates. In addition, the Bank selected and
+dispatched officials to carry out targeted assistance in Xianyang, Shaanxi Province, for the
+purpose of consolidating and expanding the achievements of poverty alleviation and promoting
+rural revitalisation in a comprehensive manner.
+109
+100.00%
+6.35%
+19,445
+3.67%
+29.74%
+Central and Southern China
+4,327,271
+15.20%
+2,746
+1-5 years (inclusive)
+65,983
+21.53%
+Western China
+2,076,633
+7.29%
+1,699
+14.84%
+37,450
+12.23%
+Hong Kong (China),
+Macao (China) and
+Taiwan (China)
+4,625,924
+16.25%
+420
+30.42%
+16.47%
+23.98%
+16.22%
+Internal Control and Operational Risk Management
+Internal Control
+The Board of Directors, senior management and their special committees earnestly performed
+their duties regarding internal control and supervision while emphasising early risk warning and
+prevention, thus improving the Group's level of operational compliance.
+The Bank continued to adopt the "Three Lines of Defence" mechanism for internal control. The
+first line of defence consists of business departments and all banking outlets. They are the owners
+of, and are accountable for, local risks and controls. They undertake self-directed risk control
+and management functions in the course of their business operations, including formulating
+and implementing policies, conducting business examination, reporting control deficiencies and
+organising rectifications.
+The internal control and risk management departments of the Bank's institutions at all levels
+form the second line of defence. They are responsible for the overall planning, implementing,
+examining and assessment of risk management and internal control, as well as for identifying,
+measuring, monitoring and controlling risks. They lead the first line of defence to enhance its use
+of the Group's operational risk monitoring and analysis platform, and are responsible for handling
+employee violations and management accountability. Through regular monitoring of material
+risks, the Bank identified and mitigated risks in a timely manner and promoted the optimisation of
+its business processes and systems.
+The third line of defence rests in the audit department of the Bank. The audit department is
+responsible for performing internal audits of the Bank's internal control and risk management in
+respect of its adequacy and effectiveness. Adhering to the risk-oriented principle and focusing
+on the implementation of national policies, regulatory requirements and the Group's strategies,
+the audit department concentrated its efforts on the main responsibilities of audit supervision,
+closely monitored material potential risks and weak links, and carried out audit inspections as
+scheduled. It carried out audits in a more forward-looking and proactive manner, and improved
+the capabilities of the first and second lines of defence for preventing problems, hence nipping
+problems in the bud. The audit department attached equal importance to problem revelation and
+rectification supervision. It further improved its rectification supervision mechanism for audit
+findings, strengthened the tracking, inspection and prioritised supervision of audit findings
+103
+rectification, and promoted the application of audit results and the improvement of rectification
+quality and efficiency. The Bank also stepped up overall audit planning, deepened audit system
+reform, continued to enhance audit team building and promoted IT applications in audit, thus
+further reinforcing the efficiency of audit supervision.
+The Bank devoted great efforts to internal control and case prevention management, consolidated
+the liabilities of primary responsible parties and took multiple control measures. It consistently
+improved internal control rules, processes and systems, formulated the policy and measures
+for case prevention management, and refined the management measures for internal control
+inspection. It also stepped up efforts in the building of its internal control inspection team,
+organised Bank-wide risk screening, and carried out the campaign of "Year for Improving
+Internal Control and Compliance Management", thereby continuously improving its internal
+control and compliance management. The Bank also focused on the rectification of issues and
+findings, conducted warning and education activities on a regular basis, raised employees'
+compliance awareness and fostered an internal control compliance culture.
+The Bank continued to implement the Basic Standard for Enterprise Internal Control and its
+supporting guidelines, and implemented the Guidelines for Internal Control of Commercial Banks
+by following the basic principles of "complete coverage, checks and balances, prudence and
+correspondence", so as to promote internal control governance and an organisational structure
+characterised by a reasonable delegation of work, well-defined responsibilities and clear reporting
+lines.
+The Bank established and implemented a systematic financial accounting policy framework in
+accordance with relevant accounting laws and regulations. As such, its accounting basis was
+solidified and the level of standardisation and refinement of its financial accounting management
+was further improved. From 2019 to 2021, the Bank endeavoured to implement sound accounting
+standards and establish a long-term accounting management mechanism. It continuously
+strengthened the quality management of its accounting information to ensure internal control
+effectiveness over financial reporting. The financial statements of the Bank were prepared in
+accordance with the applicable accounting standards and related accounting regulations, and the
+financial position, operational performance and cash flows of the Bank were fairly presented in
+all material respects.
+The Bank paid close attention to fraud risk prevention and control, proactively identifying,
+assessing, controlling and mitigating risks. In 2021, the Bank succeeded in preventing 127
+external cases involving RMB79.03 million.
+104
+Operational Risk Management
+The Bank continuously improved its operational risk management system. It promoted the
+application of operational risk management tools, including Risk and Control Assessment
+(RACA), Key Risk Indicators (KRI), Loss Data Collection (LDC), etc., carried out the
+identification, assessment and monitoring of operational risk, and further standardised its
+operational risk reporting mechanism, thus continuously improving its risk management
+measures. The Bank enhanced its IT system support capabilities by optimising its operational
+risk management information system. It strengthened its business continuity management system,
+optimised its operating mechanism, enhanced its business continuity policies, and performed
+business impact analysis. The Bank also refined contingency plans, carried out business
+continuity drills, proactively addressed the COVID-19 pandemic and improved the Group's
+business continuity capacity.
+Compliance Management
+The Bank continuously improved its compliance risk governance mechanism and management
+process to ensure the Group's sound operation and sustainable development. It improved its
+anti-money laundering (AML) and sanctions compliance management mechanism, strengthened
+refined management, optimised institutional money laundering risk assessment, and reinforced
+transaction monitoring and reporting. It further enhanced its system and model building and
+improved system functionality. The Bank continuously strengthened the establishment of a long-
+term robust management framework for overseas institutions compliance and consolidated its
+compliance management foundations, thus enhancing the compliance management capabilities
+of its overseas institutions. It improved its AML and sanction compliance training management
+mechanism and conducted various forms of compliance training, so as to enhance all employees'
+compliance awareness and abilities.
+The Bank enhanced the management of its connected transactions and internal transactions. It
+continuously improved the management of connected parties and consolidated the foundation of
+its connected transaction management. It strengthened the routine monitoring and examination of
+connected transactions and strictly controlled their risks. In addition, it continuously strengthened
+its internal transaction management mechanism, implemented internal transaction monitoring and
+reporting. It was also committed to improving its connected transaction monitoring system and
+internal transaction management system, and thereby enhanced IT applications in compliance
+management.
+Country Risk Management
+The Bank incorporates country risk into its comprehensive risk management system in strict
+accordance with regulatory requirements. It manages and controls country risk through a series of
+management tools, including country risk rating, country risk limit, statistics and monitoring of
+country risk exposures, and provisioning of allowances.
+105
+The Bank earnestly implemented regulatory requirements on reputational risk management,
+continued to enhance its reputational risk management system and mechanism and strengthened
+the consolidated management of reputational risk, so as to enhance its overall reputational risk
+management capabilities. It attached great importance to the investigation and pre-warning
+of potential reputational risk factors, strengthened public opinion monitoring, continued to
+conduct reputational risk identification, assessment and reporting, and dealt appropriately
+with reputational events, thus effectively protecting its brand reputation. In addition, the Bank
+continued to roll out reputational risk management training so as to enhance employees'
+awareness and foster a culture of reputational risk management.
+Facing the extremely complicated international political and economic situation, the Bank
+continued to strengthen country risk management in strict accordance with regulatory
+requirements and based on business development needs. It optimised the rules for country risk
+rating and limit determination, and made country rating and limit management more science-
+based and efficient. It also strengthened country risk monitoring, improved country risk analysis
+and reporting, and enhanced the country risk management system. The Bank actively pushed
+forward the provisioning of country risk allowances and enhanced its ability to offset country
+risk. Country risk exposures were mainly concentrated in countries and regions with low and
+relatively low country risk, and the overall country risk was controlled at a reasonable level.
+Reputational Risk Management
+Note: Liquidity gap = assets that mature in a certain period – liabilities that mature in the same period.
+16.91%
+Total
+As at
+Unit: RMB million
+As at
+31 December 2021
+2,111,462
+31 December 2020
+2,036,554
+(8,932,662)
+(9,586,299)
+(364,383)
+(693,580)
+(685,992)
+(143,909)
+(300,183)
+70,657
+3,330,756
+2,895,333
+7,845,192
+6,930,444
+2,350,553
+2,162,837
+-
+102
+CAPITAL MANAGEMENT
+1-3 months (inclusive)
+To achieve the above objectives, the Bank formulated a capital management plan for the 14th
+Five-year Plan period which was approved by the Shareholders' Meeting. Focusing on the
+"One Mainstay, Two Engines" strategy and the "Eight Priority Areas for Enhancing Financial
+Services Capabilities", the capital management plan clarified the principles, objectives and
+measures of medium- and long-term capital management. In accordance with regulatory
+policies, the Bank regularly carried out its internal capital adequacy assessment process, revised
+its capital management rules, and continuously improved its capital management governance
+structure. It improved the economic capital budget and assessment mechanism, strengthened
+the application of value creation indicators in resource allocation, and heightened the Group's
+awareness of capital saving and value creation in order to enhance its capability for endogenous
+capital accumulation. The Bank expanded the application of advanced approaches of capital
+measurement, optimised its on- and off-balance sheet asset structure, strived to reduce capital
+consumption, actively developed capital-light businesses, and reasonably controlled the risk
+weight of assets. The Bank replenished capital through external financing channels in a prudent
+manner in order to consolidate its capital base, strengthened researching and planning on policies
+on total loss-absorbing capacity, and prepared for those policies' implementation.
+1,992,621
+1,883,294
+1,719,467
+Net capital
+2,698,839
+2,451,055
+2,391,365
+2,162,054
+Common equity tier 1 capital
+adequacy ratio
+11.28%
+11.06%
+10.99%
+Tier 1 capital adequacy ratio
+13.32%
+13.19%
+13.32%
+13.10%
+Capital adequacy ratio
+16.53%
+The Bank's capital management objectives are to ensure reasonable capital adequacy, support
+the implementation of the Group's strategies, resist various risks including credit risk, market
+risk and operational risk, ensure the compliance of the Group and related institutions with capital
+regulatory requirements, promote the Group's transformation towards capital-light business
+development and improve its capital use efficiency and value creation capabilities.
+2,173,731
+Net tier 1 capital
+11.30%
+1,563,789
+106
+In 2021, the Bank successfully issued RMB70.0 billion of undated capital bonds and RMB75.0
+billion of tier 2 capital bonds, further enhancing its capital strength. It reinforced the management
+of existing capital instruments and redeemed RMB28.0 billion of domestic preference shares,
+effectively reducing the cost of capital. The Bank continually reinforced internal management,
+with RWA growing at a slower pace than total assets. As at the end of 2021, the Group's capital
+adequacy ratio reached 16.53%, an increase of 0.31 percentage point from the end of 2020,
+remaining at a robust and reasonable level in compliance with the objectives of the Group's 14th
+Five-Year Plan. The Bank shall, as per the principle of attaching equal importance to endogenous
+accumulation and external replenishment, increase the cohesion of strategic planning, capital
+replenishment, and performance assessment, continue to enhance risk resistance, and better
+support the development of the real economy.
+1,441,977
+Capital Adequacy Ratios
+As at the end of 2021, the capital adequacy ratios calculated in accordance with the Capital Rules
+for Commercial Banks (Provisional) are listed below:
+Group
+Unit: RMB million, except percentages
+Bank
+As at
+As at
+As at
+31 December
+As at
+31 December 31 December
+31 December
+Items
+2021
+2020
+2021
+2020
+1,704,778
+Net common equity tier 1 capital
+1,843,886
+The Bank determined its priorities for education and training according to the 14th Five-Year
+Plan of the country and the Bank, formulating and implementing the 14th Five-Year Plan
+for Education and Training and thus making a fresh start for the new period. To empower
+employees and the Group, it established a Bank-wide training system that reflects the Bank's
+strategies and growth performance targets, with a focus on strategic mission training, core
+competence and key personnel training, qualifications and post competence training, and daily
+business training. Efforts were made to promote training methods such as action learning and
+case-based teaching, and to implement training programmes for accelerated leadership reform,
+core professional abilities and talent cultivation for digitalised development. The Bank carried
+out learning activities under the brands of "BOC Lecture Hall”, “Staff Learning Day”, “New
+Employee Development Community", and so on. To empower customers and society, the training
+programmes of "School of Smart Government Services", "Rural Revitalisation School" and
+"New Finance School" were launched for local government officials, people working in rural
+revitalisation industries and corporate customers. The governance and management mechanisms
+for education and training were improved, teaching staff and training resources were enhanced,
+and the digital transformation of education and training was expedited, allowing the Bank to
+accelerate the construction of an education and training system befitting a first-class global
+banking group. In addition, the Bank's online training capability was further strengthened against
+the backdrop of COVID-19 prevention and control. On an accumulative basis, the Bank's online
+training platform offered more than 25,000 courses, and the employees' total online learning time
+reached 9.35 million hours.
+112
+8
+KEY ISSUES OF CONCERN TO THE CAPITAL MARKET
+Serve the Real Economy
+According to the PBOC statistics
+The financial industry is responsible for providing high-quality financial services to support
+economic and social development as well as people's productivity and livelihoods. Closely
+aligning with prevailing trends, the Bank has given full play to its financial strengths
+as a major state-owned bank in terms of serving national strategies and supporting the
+development of the real economy. In 2021, the Bank took multiple measures to earnestly
+implement the requirements of “ensuring stability on six fronts and security in six areas”,
+made comprehensive efforts to serve the real economy, and enhanced support to key areas
+such as inclusive finance, green finance, strategic emerging industries and manufacturing.
+Upholding the concept of “innovation, coordination, green development, opening up
+and sharing", it supported the development of major projects, key regions, and new
+infrastructure and new urbanisation initiatives; assisted in building a new development
+pattern of “dual circulations reinforcing each other”, and applied its professional strengths to
+"financing" and "intelligence".
+As at the end of 2021, the balance of domestic RMB corporate loans was RMB7,161.416
+billion, up RMB895.085 billion or 14.28% from the beginning of the year. Both the
+increment and the growth rate achieved a record high compared to previous years. The
+balance of inclusive loans granted to micro and small enterprises under the CBIRC target of
+"two no-less-than and two control" amounted to RMB881.5 billion, up RMB305.9 billion
+or 53.15% compared with the prior year-end, ranking first among the four major domestic
+banks. Specifically, the balance of inclusive loans granted to micro and small enterprises
+was RMB516.2 billion, an increase of RMB207.5 billion or 67.2% from the prior year-end.
+In terms of industry, the Bank actively supported the high-quality development of key areas
+such as green finance, strategic emerging industries, manufacturing and private enterprises.
+The balance of new green loans granted to corporate customers grew by RMB419.7 billion
+or 45.86% from the beginning of the year, ranking first among the four major peers. The
+balance of financial instruments used for carbon emission reduction was RMB27.1 billion
+and the balance of loans granted for clean and efficient utilisation of coal was RMB2.5
+billion. In addition, according to CBIRC statistics, compared with the beginning of the
+year, the balance of loans granted to strategic emerging industries grew by RMB299.3
+billion or 135%, and medium and long-term loans to manufacturing industries increasing
+by RMB129.1 billion or 28.8%. The balance of loans granted to private enterprises was
+RMB2.44 trillion, up RMB326.8 billion or 15.46% over the prior year-end. The accumulated
+total of new private enterprise loans was RMB2.69 trillion, accounting for 41.57% of total
+accumulated new corporate loans, an increase of 1.44 percentage points compared with the
+prior year-end.
+Staff Education and Training
+I.
+111
+Cross-marketing and teller
+The Bank's remuneration distribution policy follows the principle of “remuneration by post,
+payment by performance”. Employee remuneration consists of basic salary, performance-based
+remuneration and benefits. Basic salary is determined by the value of the position and the ability
+of employees to perform their duties. Performance-based remuneration depends on performance
+evaluation results of the Group, the institution or department of the employee, and the employee,
+and is linked to performance, risk, internal control, ability and other factors. Deferred payment
+is required for more than 40% of the performance-based remuneration of personnel who are
+responsible for the Group's major risk management and control functions, with a deferred
+payment period of not less than three years. The Bank has formulated and implemented a
+recourse and recovery mechanism for performance-based remuneration of senior management
+members and personnel in key posts. If risk losses falling within such employees' remit and
+responsibility are clearly exposed during the term of service, the Bank may recover part or all of
+the performance-based remuneration paid within the corresponding period, and stop the payment
+of the part that has not been paid. Benefits mainly include social insurance, housing provident
+fund, enterprise annuity and other non-cash remuneration, and are managed in accordance
+with local regulatory policies. The Bank's remuneration policy applies to all employees who
+have established a labour contract relationship with the Bank, with no exceptions beyond the
+remuneration policy.
+The Bank's remuneration policy is in line with corporate governance requirements, business
+development strategies, market positioning and talent competition strategies. The Board of
+Directors of the Bank has set up the Personnel and Remuneration Committee to assist it in
+reviewing the Bank's human resources and remuneration strategies. An independent director
+serves as the Chairman of the Committee. Please refer to the section “Corporate Governance
+Special Committees of the Board of Directors” for details of the work progress of the Personnel
+and Remuneration Committee. Based on the human resources and remuneration strategies
+determined by the Board of Directors, the senior management of the Bank is responsible for
+formulating rules and regulations for remuneration management.
+110
+The Bank continuously improved its incentive and constraint mechanism, established an
+assessment mechanism combining “annual assessment + long/short-cycle assessment" and
+"performance assessment + value assessment”, strengthened its assessment of employees'
+contributions to serving the real economy, developing inclusive finance and supporting private
+enterprises, and guided the establishment of an appropriate perspective on performance.
+Remuneration
+9.89%
+Other
+34.91%
+3.07%
+Information technology
+0.35%
+113
+The Bank has formulated an allocation mechanism for total remuneration. The distribution
+of total remuneration resources to branches is linked to their completion of comprehensive
+contribution goals, taking full consideration of risk factors so as to focus on risk-adjusted
+value creation and enhance long-term performance. The Bank continued to improve its internal
+remuneration distribution structure and allocated more remuneration resources to primary-level
+institutions and employees in order to effectively boost the driving force that fuels the sustainable
+development of the Bank.
+In 2022, the Bank will continue to implement the requirements of the national 14th Five-
+Year Plan, focus on serving the real economy, seize business opportunities in key areas,
+and maintain reasonable growth in loans while preventing credit risks. It will serve national
+strategies by continuously improving its corporate credit structure and strengthening its
+support for key areas such as green credit, strategic emerging industries, manufacturing,
+private enterprises and rural revitalisation. Moreover, it will increase inclusive finance
+support for micro and small enterprises, vigorously develop technology finance, and step
+up its support for “specialised, refined, featured and innovative" enterprises within the
+advanced manufacturing industries, as well as micro and small enterprises engaged in
+scientific and technological innovation. It will put in place improved industry policies
+and supporting resources, further enhance its credit selection and allocation capabilities
+for industries, regions, customers and projects, strengthen its market competitiveness in
+corporate banking and build a high-quality development model for its corporate banking
+business, thus continuously stimulating the vitality of a wide range of market players.
+In 2022, the banking industry will face a complicated operating environment. From an
+international perspective, the global economic situation is becoming more complex and severe,
+with the pandemic, inflation and developed economies' monetary policy adjustments acting
+as three major sources of global economic uncertainty. From a domestic perspective, despite
+pressures from demand contraction, supply shocks and weakening expectations for economic
+development, the economic fundamentals that will sustain long-term growth and the favourable
+conditions for fostering a new pattern of development remain unchanged. The major economic
+indicators will continually keep within an appropriate range.
+In recent years, the Bank has actively responded to the changes in internal and external
+situations and taken multiple measures to effectively prevent and defuse risks, with its
+asset quality remaining at a high level among its peers. As at the end of 2021, the Group's
+outstanding non-performing loans (NPLs) stood at RMB208.792 billion, an increase of
+RMB1.519 billion compared with the prior year-end; while its NPL ratio was 1.33%, down
+0.13 percentage point compared with the prior year-end. Outstanding special mention loans
+registered RMB210.813 billion, a decrease of RMB53.781 billion compared with the prior
+year-end; the special mention loans accounted for 1.35% of the total, a decrease of 0.52
+percentage point compared with the prior year-end. Overdue loans were RMB167.737
+billion, down RMB11.647 billion compared with the prior year-end; the overdue rate was
+1.07%, a decrease of 0.19 percentage point compared with the prior year-end. The main risk
+indicators improved stably, and the asset quality remained healthy and steady.
+Third, the Bank will accelerate digital transformation and enhance the new momentum of
+development. It will speed up the implementation of Enterprise Architecture, deepen the
+integration of business with science and technology, and substantially improve scientific and
+technological response speed and output efficiency. It will rapidly advance the integrated
+development of a strategic scenario ecosystem and strengthen the integration of financial products
+and scenarios, so as to widen industry coverage and penetration. It will accelerate the building
+of mobile banking and online banking, promote smart operations and outlet transformation, and
+establish online and offline channels featuring intelligent interaction, distinctive services and
+diverse scenarios, in a bid to constantly improve service quality and efficiency.
+118
+Second, the Bank will continue to improve its development pattern and sharpen its comprehensive
+services capabilities. It will give full play to the dominant position of domestic commercial
+banks, enhancing resources and institutional support, actively making innovations in products and
+services, so as to enhance market competitiveness. It will continue to consolidate its distinctive
+advantages and improve its market-by-market strategies for overseas institutions, steadily
+advance globalisation by shifting focus from quantitative growth to qualitative improvement.
+It will strengthen and enhance its integrated operations, give full play to the advantages of
+commercial banking, investment banking, direct investment, wealth management, insurance,
+leasing and other comprehensive financial services, in order to sharpen its market competitiveness
+capabilities and improve its contribution to the Group. It will accelerate the building of “One
+Mainstay, Two Engines", and strive to satisfy our customers by ensuring that they are able to
+access the Bank's global resources and services at any point of contact.
+First, the Bank will actively integrate into the big picture of national development and serve the
+real economy. Focusing on promoting high-quality development, the Bank will serve supply-
+side structural reform of the financial sector, concentrate efforts on developing the "Eight
+Priority Areas for Enhancing Financial Services Capabilities", and further improve the quality
+and efficiency of its support to the real economy. It will serve the nation's innovation-driven
+development strategy, increase the scale of loans granted to strategic emerging industries, support
+for green and low-carbon development, and accelerate the innovation and application of green
+credit products. It will increase financial support for new infrastructure and new urbanisation
+initiatives as well as major projects, optimise the supply of wealth finance products and services,
+strengthen the building of scenarios related to people's livelihood, and support the national
+plan of ensuring the supply of goods and materials and major agricultural products as well as
+agricultural modernisation. In 2022, the Bank's RMB loans in the Chinese mainland are expected
+to grow by approximately 10%.
+The year 2022 marks the 110 anniversary of the Bank's establishment, the Bank will adhere to
+place an utmost priority on stability and pursue progress while ensuring stability, apply the new
+development philosophy fully, faithfully and comprehensively, and support the creation of the
+new development pattern. It will uphold the philosophy of serving the country through financial
+services, fulfil its responsibilities as a large bank, continue to invigorate, adapt to change and
+drive for major breakthroughs, steadily push forward the implementation of the 14th Five-Year
+Plan, and thus making sustained progress in its new journey towards building a first-class global
+banking group.
+Financial markets
+OUTLOOK
+117
+Looking into 2022, the global economic situation is becoming more complex and severe
+and our overseas operations face both opportunities and challenges. It is all the more
+important for our overseas network to place greater emphasis on stability while pursuing
+growth. While positioning themselves to better address risks in the financial markets,
+overseas institutions will bolster their balance sheets through proper and timely asset and
+liability management, to seize opportunities for growth and maintain steady improvement in
+operating efficiency.
+To drive business growth, the Bank recognised and acted on opportunities in cross-border
+trade and investment, such as those emerged in the nation's high-quality “Bringing In” and
+"Going Global" initiatives. In addition, we rode the trend of China's two-way opening up
+of the financial sector, the development of financial factor market. The Bank also promoted
+green finance, cross-border finance, wealth management and supply chain finance in
+overseas markets, thus elevating our ability to provide global services. The Bank categorised
+its overseas institutions strategically based on their historical status and market positions,
+and adopted a market-by-market strategy to reflect their respective business goals and
+operational priorities. In line with the Group's new “One Mainstay, Two Engines” strategy,
+the Bank further coordinated its services at home and abroad to better support our clients in
+their globalised endeavours. Taking it a bottom line to ensure workplace safety, the Bank
+did its best to protect the physical and psychological well-being of its employees and keep
+its institutions safe, thus maintaining business continuity around the world.
+grow.
+The Bank continued to optimise its global network, expanding overseas presence to 62
+countries and regions outside Chinese mainland, including 41 Belt and Road members. Last
+year witnessed the opening of the Yangon Branch in Myanmar, Hanoi Representative Office
+in Vietnam and Geneva Branch in Switzerland. In managing its international network, the
+Bank further improved the matrix-based approach combining Regionalised Management
+and Integrated Operation. BOCHK, boasting network in nine Southeast Asian countries,
+worked to take regional integration further with fruitful results, as testified by the rising
+market influence of these branches and subsidiaries and their growing capacity to serve
+customers and support local economies. Institutions in Europe, Africa and the Middle East
+also advanced Regionalised Management and business consolidation as planned, leading
+to greater synergy, higher quality and efficiency in this region. Integrated Operation was
+steadily carried out, and our competence and capacity to serve global clients continued to
+116
+In 2021, the Bank embraced the new development stage and delivered on the “One
+Mainstay, Two Engines" strategy through more efficient policy execution and further
+advancement in globalised operations. In serving China's new development paradigm and
+higher-level opening up, the Bank tapped into new business opportunities and improved our
+capacity to offer financial services around the world. As a result, the Bank's development
+plan during the 14th Five-Year period was set off to a good start.
+IV. Globalised Development
+In 2022, guided by the Group's 14th Five-Year Plan, centered on the driver of
+comprehensive digital transformation, the Bank will focus on building the "two pillars"
+of enterprise-level business architecture and enterprise-level IT architecture, and strive for
+breakthroughs in the “three main lines" of empowering business development, consolidating
+basic support, and planning for future capabilities. Centring on changes in customer demand
+and industrial upgrading and transformation. It will enhance the competitiveness of key
+products, promote the green and efficient operation of financial technology, and accelerate
+the scaled integration and application of new technologies, thus writing a new chapter for
+the "SMART BOC+” brand, building up momentum and energy towards the high-quality
+development of the Group, and contributing to the development of a digital China.
+Fourth, the Bank's digital infrastructure capacity was continuously consolidated to promote
+technological data empowerment. The Oasis project, a next-generation enterprise-level
+technology platform, was successfully put into operation. The Bank's data governance
+framework was basically completed, and its data assets continued to realise greater value.
+Emerging technology platforms continued to be iterated and upgraded, injecting new
+momentum for business development. Furthermore, the Bank improved its mechanism
+for tackling key innovation problems and promoted the application and R&D of new
+technologies, the replication and scaling of key achievements, and the securing of a leading
+position in industry rankings. A total of six awards for fintech development and 194 patents
+were granted in 2021, all of which exceeded the previous years' level.
+Third, digital operation and management was integrated into the Bank's day-to-day routines
+to improve the efficiency of organisational synergies. The Bank created digital management
+tools directly penetrating to outlets, put into operation a digital management platform
+and a unified staff channel for outlets, and launched smart screens in outlet halls. It built
+a comprehensive operations platform to promote electronic flows, an “assembly line”
+approach to operations and standardised management, thus enhancing business processing
+efficiency by more than 60%. A total of 217 mobile office platform applications were made
+available to employees, promoting online communication, processes and management, and
+enhancing the Bank's agile response capabilities.
+115
+Second, the Bank's diversified scenario ecosystem highlighted BOC's core strengths and
+gave full play to the value of opening-up and sharing. The basic platform for strategic
+scenarios was further developed, and the promotion of innovation application across the
+Bank's businesses was steadily accelerated. The Bank launched the "BOC Cross-Border
+Go" app and "BOC Compass" mini-programme to serve cross-border customers. It built
+platforms themed on "smart campus” and alumni public welfare, and launched "Baby
+Money Box" to help children develop good saving habits. It connected into nearly 1,500
+sports stadiums, and its "Winter Sports with BOC” campaign became increasingly popular.
+The BOC University for the Elderly and the public service platform of mutual aid for the
+elderly helped make the lives of the elderly more colourful. E-CNY payment allowed
+customers to meet a variety of daily needs such as ordering takeaway meals, paying
+electricity bills, charging public transport cards and buying licensed products of the Beijing
+2022 Winter Olympic Games.
+First, the Bank's online business system continued to mature, driving improvement in
+service quality and efficiency. In transaction banking, an integrated financial service
+platform for corporate customers was launched, with services such as cross-border
+remittance and supply chain financing now available online. Online inclusive financial
+products such as mortgage loans, foreign trade loans and preferential loans for farmers
+were released. The E-Cooperation global enterprise ecosystem provided all-round and
+24/7 cross-border matchmaking services for global enterprises. The Bank launched Mobile
+Banking Version 7.0 and promoted the iteration of basic and frequently-used functions as
+well as improved accessibility for the elderly, so as to provide customers with a frictionless,
+360-degree convenient banking experience. The “Cyber Defence” smart risk control and
+prevention system was refined, and artificial intelligence models were applied to enhance
+the safety of online financial services.
+As the tide of digitalisation surges forward, now is the time for transformation and
+change. In 2021, the Bank released the Group's 14th Five-Year Plan, which made
+digital transformation central to how its business development mode will evolve during
+the current period. It also formulated two important action plans for fintech and data
+strategy, respectively. The Financial Digitalisation Committee has carried out its routine
+responsibilities for coordinating and advancing the Group's digitalised development,
+financial technology and data governance. By innovating its service models, enriching
+customer experience and reducing operating costs, the comprehensive digital transformation
+of the Bank has been continuously deepened across a number of aspects.
+III. Digital Transformation
+114
+Looking into 2022, the international political and economic landscapes are undergoing
+profound evolution. Spillover effects of the US Federal Reserve's policy of shrinking the
+balance sheet and raising interest rates will exacerbate turbulence in the global financial
+market, and emerging market countries are facing the impact of overlapping factors such as
+heavy debt burden, high external dependence and recurring pandemic. Uncertainties in the
+external environment will persist for a long time to come. From the domestic perspective,
+the general principle of prioritising stability while pursuing progress and the long-term
+positive fundamentals will remain unchanged. At the same time, however, the economy
+is still facing certain downward pressure, and uncertainties affecting the quality of bank
+assets still exist. The Bank will continue to better integrate the prevention and diffusion of
+financial risks with serving the real economy, intensify risk identification and control in key
+areas, and make forward-looking judgement and take multiple measures to do its best in
+credit risk control. The asset quality of the Group is expected to remain relatively stable.
+II. Asset Quality
+9.05%
+70.64%
+18.86%
+13.12%
+18.07%
+17.43%
+51 and above
+18.53%
+24.60%
+23.83%
+Between 41 and 50
+37.80%
+36.74%
+36.87%
+Between 31 and 40
+30.55%
+20.59%
+21.87%
+Up to 30
+affiliated
+companies
+The Group Chinese mainland
+business in the
+Overseas
+institutions and
+Commercial
+banking
+Composition of Staff
+Items
+Composition of Staff by Age Group and Education Level
+As at the end of 2021, the Bank had 306,322 employees. There were 280,908 employees in the
+Chinese mainland, of which 267,037 worked in the Bank's commercial banking business in the
+Chinese mainland. The Bank had 25,414 employees in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions. As at the end of 2021, the Bank bore costs for a
+total of 4,934 retirees.
+Composition of Staff
+Risk and internal control
+management
+by Education Level
+10.55%
+Personal banking
+7.61%
+financial management
+16.26% Operation services and
+Corporate banking
+business in the
+Chinese mainland
+Items
+business in the
+Chinese mainland
+Items
+Commercial
+banking
+Commercial
+banking
+Composition of Staff by Job Function (Commercial banking business in the Chinese mainland)
+8.09%
+3.46%
+4.05%
+Other
+14.79%
+17.23%
+16.92%
+Associate degree
+53.78%
+68.48%
+Bachelor's degree
+23.34%
+8.67%
+Master's degree and above
+by Age Group
+119
+Fourth, the Bank will forestall and defuse financial risks and reinforce its development protection
+network. It will deepen the establishment of a comprehensive risk management system and
+improve its multi-tier early-warning system in order to drive business development in a safe and
+stable manner. It will accurately identify major risks in the context of the new situation, improve
+risk prevention and control mechanisms, and maintain stable asset quality. It will continue to
+concentrate on the establishment of a long-term compliance mechanism for internal control
+in order to prevent cases of financial risk and anti-money laundering and carry out special
+governance in key areas. It will closely guard against information technology risk and improve
+its emergency response effectiveness. Moreover, it will upgrade its mechanisms for safeguarding
+consumers' rights and interests, so as to deliver better protection.
+126
+The amount of overseas green
+bonds underwritten reached
+USD23.4 billion, ranking
+first among Chinese institutions on
+Bloomberg's ranking of the
+world's offshore green bonds
+The amount of domestic green
+bonds underwritten reached
+RMB129.4 billion, ranking
+first among commercial banks
+No. 1
+Undertaking
+Investment No. 1
+ranking first on NAFMII's list of
+investors with green bonds in 2021
+Other Indicators
+Green bonds
+Non-performing ratio of green
+credits was lower than 0.5%
+(CBIRC statistics), lower
+than the overall NPL ratio
+of the Group level
+Year-on-year growth of over
+60%
+Year-on-year growth of
+57% (CBIRC statistics)
+An increase of
+RMB500 billion,
+overfulfilling the phased goal
+with the 2021 balance of
+green credits reaching
+RMB 1,408.6 billion
+(CBIRC statistics)
+Completion Progress
+maintained at a good level
+Most active
+Issuance
+A total of USD10.7 billion
+equivalent green bonds were issued
+overseas. making the Bank the most
+active Chinese green bond issuer
+The amount of BOC Financial
+Leasing green assets is RMB 10.6 billion,
+about 28% of its total leasing assets
+BOC Asset Investment invested
+RMB27.9 billion in green industries,
+accounting for over 40% in its investment
+portfolio
+1,385
+52
+67
+11,702
+25,380
+Ammonia nitrogen emission reduction (10 thousand tons)
+Sulfur dioxide emission reduction (10 thousand tons)
+Nitrogen oxides emission reduction (10 thousand tons)
+Water saving (10 thousand tons)
+CO₂ equivalent emission reduction (10 thousand tons)
+COD emission reduction (10 thousand tons)
+Assets quality was
+Equivalent to emission reduction standard coal in equivalent (10 thousand tons)
+Environmental performance of the Bank's green credits:
+BOCI underwrote 24 overseas green and
+sustainable development bonds for whole
+year 2021, with the amount exceeding
+USD8 billion in equivalent
+BOCG Investment invested in eight
+green projects during the year, with the
+balance of investments totaling
+RMB11.1 billion
+BOC Wealth Management issued 30 green
+finance themed products, with the product
+balance exceeding RMB 12.9 billion
+BOCIM issued the BOX SHCH 0-5 Year
+ADBC Bond Index fund, with the amount
+reaching RMB5.1 billion
+BOC Insurance launched 9 environmental
+pollution liability insurance products,
+with total committed liability at around
+RMB8.3 billion
+Environmental performance of green credits in 2021
+Annual average growth rate
+of personal green
+consumption credits by
+domestic operations
+No less than 30%
+striving for 60%
+Balance of green credits
+increase on a yearly
+basis
+Industries
+Policies on Credit Approval Authority for Relevant
+Strengthen the management of green credit contracts
+Administrative Measures for Mortgage and Pledge of
+Carbon Emission Permit
+e Lithium-ion Power
+Credit Policy for the L
+Battary Industry
+Guidelines on Industry
+Industry Asset Portfolio
+Credit Orientation
+Management Plan
+71
+Industrial
+Policies
+Vehicle Manufacturing Industry
+Credit Policy for New Energy Whole
+Environment Treatment Industry
+Credit Policy for Water and Water
+Generation Industry
+Credit Policy for Photovoltaic Power
+Manufacturing Industry
+Credit Policy for Wind Power Equipment
+Credit Policy for Hydropower Industry
+development of green credit
+Carbon emission reduction supporting tools boost the
+Subsidy Right
+Guidelines on Financing against Renewable Energy
+for Green Finance of Overseas Institutions
+Working Requirements
+Inclusive Loan Carbon Loan Service Plan
+Promote high-quality development of green finance
+Increase green credit granting
+RMB 1 trillion
+Providing financial support
+of no less than RMB f
+trillion for green industries
+Objectives
+14th Five-Year Plan Period
+The Bank's major green finance targets and the performance in 2021 are shown below:
+Performance of Green Finance
+122
+1,374
+The Bank participated in stress tests on climate risk organised by the PBOC, and evaluated the
+potential impact of transition under the goal of “peak carbon emissions and carbon neutrality”
+on credit assets. The results show that the credit risks of customers in thermal power generation,
+steel and cement industries increased under the stress scenario, and the impact on capital
+adequacy is controllable. The Bank's overseas institutions successively conducted stress tests.
+Bank of China (UK) Limited integrated the stress test in the climate risk scenario into the 2021
+ICAAP report; BOCHK completed stress tests on transition risks and physical risks for several
+industries; Singapore Branch, Frankfurt Branch and Sydney Branch also have commenced work
+relating to climate risk stress test.
+The Bank intensified efforts in the identification, analysis, mitigation, control and reporting of
+environmental and climate risks, amended the Comprehensive Risk Management Policy of Bank
+of China Limited, and incorporated environmental and climate risks into the comprehensive risk
+management system. It comprehensively reviewed and streamlined the environmental and social
+risks of business processes, covering target customer access, business initiation, due diligence,
+credit approval, contract management and duration management. Restrictive requirements for
+environmental and social risk management were added in the credit policies on 71 industries such
+as agriculture, forestry, animal husbandry and fisheries, mining and metallurgical industry, oil
+and gas, rail transit and material manufacturing, prohibiting credit support for projects that would
+damage biodiversity.
+Environmental Risk Management
+121
+Domestic branches, major overseas institutions and comprehensive operating companies formulated green finance strategies or work plans
+Guidelines on Green Credit of Bank of China
+Strategic Evaluation Plan for Serving Ecological Progress
+The Bank adopted stratified management for corporate customers according to their
+environmental and social risk levels, and imposed stricter assessment and review measures
+over high-risk customers. It formulated the List of Environmental and Social Risk Compliance
+Documents and the Checklist of Potential Compliance Risks for medium and high-risk customers,
+imposing higher project assessment standards over aspects of climate change and energy
+management, cultural heritage preservation, labor conditions and community environmental
+health management, biodiversity and sustainable resource protection. It also adopted the "One
+Vote Veto System” to stop credit support for projects that failed in national environmental
+impact assessment and other relevant standards. It carried out regular internal control compliance
+inspections to review and evaluate customers' environmental and social risk levels and green
+credit labels. It also strengthened the communication with stakeholders, strictly complied with
+local laws and regulations on environmental protection, and integrated eco-environmental cost,
+risks and other factors into the management procedure to lower environmental and social risks.
+BOC Zhejiang Branch has established an ESG assessment system to integrate customers' ESG
+assessment results into due diligence, project review etc. BOC Wealth Management and BOCI
+both incorporated ESG factors into their project screening, review and other relevant procedures
+as a reference for investment.
+12,992
+In 2021, the credit of brown industries' takes less than 10% of the total domestic corporate credit,
+a decrease of over 5 percentage points from 2017.
+9
+Social Responsibilities
+Guided by its corporate mission of "Bridge China and the World for the Common Good", the
+Bank focused on the key areas of economic and social development, continuously innovated
+financial business models, optimised the supply of finance, and served to build the new
+development pattern featuring dual circulations with financial power, so as to meet the people's
+growing needs for a better life. At the same time, the Bank assumed its share of responsibility
+for building an inclusive and happy society, deepened its efforts in paired assistance and public
+charity, and worked with relevant parties to build a better home for all.
+Promoting global integration
+Leveraging the unique advantages of its global services, the Bank made use of various open
+platforms to build cross-border financial channels, scaled up support for imports and exports,
+and promoted the integration and innovation of global factors and resources, as part of its
+efforts to boost the smooth flow of capital and trade between China and the world. In 2021,
+the Bank deepened its implementation of the national policy of “ensuring stable foreign trade"
+by increasing its input to stabilise foreign trade, and optimising its credit policy to expand the
+coverage of its credit insurance financing, with the international settlement volume of domestic
+institutions reaching USD3.32 trillion, representing a year-on-year increase of 38.9%. In light of
+new business patterns in foreign trade such as cross-border e-commerce, the Bank pushed forward
+the online, intelligent and digital development of cross-border finance, upgraded the "BOC Cross-
+border E-commerce Connect” product, and provided inclusive payment and collection services
+for the import and export of cross-border e-commerce, recording total financial settlement
+volumes of over RMB140.0 billion for the whole year. It launched the "BOC Cross-Border
+E-Procurement Express" to provide online convenient foreign exchange collection and settlement
+services for enterprises engaged in procurement and trade. The Bank also successfully hosted the
+Trade and Investment Matchmaking Conference of the Forth China International Import Expo
+(CIIE), which attracted over 1,400 Chinese and foreign enterprises from 55 countries and regions
+and reached nearly 300 cooperation intentions.
+As at the end of 2021, the Bank had established overseas institutions in 62 countries and
+regions, including 41 countries and regions along the Belt and Road. It followed up with more
+than 700 major overseas projects in countries along the Belt and Road accumulatively, and
+granted a variety of credit facilities exceeding USD223.0 billion to countries along the route
+accumulatively. At the same time, the Bank actively developed RMB internationalisation
+products, cultivated the RMB offshore market, and provided diversified services such as RMB
+settlement, investment and financing for domestic and foreign customers. The Group recorded a
+cross-border RMB settlement volume of RMB11.26 trillion for the year, up 22.36% year on year,
+and a clearing volume of RMB632 trillion, up 34% year on year.
+125
+Expanding inclusive finance
+The Bank followed the requirements of national strategy, formulated and released the inclusive
+finance plan for the 14th Five-Year Plan period, and comprehensively optimised the service
+system for inclusive finance. In 2021, taking digital and inclusive finance as the bellwether, the
+Bank launched the "Inclusive Loan” brand, which leverages big data, intelligent risk control
+and other technologies to develop a series of online products. This allowed for online automated
+operation of inclusive finance loans and provided micro and small-sized enterprises with
+"contactless" online application, drawdown and repayment services, matching their needs for
+short-term, small, frequent and prompt financing. For micro and small-sized enterprises engaged
+in science and technology innovation, pandemic prevention and control, and rural industries,
+the Bank created an innovative “MSE Benefit Loan” service plan to review and ratify the short-
+term working capital loans, as part of its efforts to support the stable and healthy development of
+micro and small-sized enterprises. Keeping a close eye on regulatory policies and industry trends,
+it also pushed forward the development of online personal inclusive loan products for individual
+businesses, micro and small business owners and innovative entrepreneurs. By working with local
+human resources and social security departments, employment guidance centres, science and
+technology innovation industrial parks and other relevant institutions, the Bank sought to provide
+financial support to individuals with capital needs for business start-ups or re-employment.
+As at the end of 2021, the balance of the Bank's inclusive loans for micro and small-sized
+enterprises under the target of “two no-less-than and two control” amounted to RMB881.5
+billion, an increase of 53.15% from the beginning of the year. The number of loan customers
+was 620,000, an increase of 32% compared with the beginning of the year. The balance of online
+personal business loans reached RMB11.726 billion, up 563.61% from the beginning of the year.
+Improving people's wellbeing
+To support people's need for a better life, the Bank continuously increased its credit support
+for transportation infrastructure, government-subsidised housing, education, health, elderly care
+and other areas concerning people's livelihood, following the principles of legal compliance
+and commercial sustainability. It proactively directed real estate-related credit resources
+towards government-subsidised housing, and provided comprehensive financial support to
+eligible educational, healthcare and elderly care institutions. The Bank piloted the convenient
+demonstration project of mobile payment and introduced more customer-friendly services for bus
+transport scenarios, enabling fare payment via mobile banking code scanning in 46 cities/regions.
+It also launched the convenient Railway e-Card service, with the total number of Railway e-Cards
+issued in the Yangtze River Delta, Guangdong-Hong Kong-Macao Greater Bay Area and Hainan
+Free Trade Zone amounting to 1.18 million (total number of Railway e-Cards issued nationwide
+as at the end of December 2021). At the same time, the Bank gave full play to its FinTech
+advantages to facilitate financial support for people in the areas of education, medical care and
+daily payments, and worked with renowned partners to expand special life service modules in
+areas such as medical care, catering, housing, travelling, entertainment and learning, so as to
+enrich its ecosystem of people-focused life scenarios and help the general public to enjoy better
+lives.
+As at the end of 2021, the balance of the Bank's loans granted to the education sector was
+RMB35.116 billion, with a growth rate of 26.43%. The balance of loans granted to the healthcare
+sector posted RMB46.83 billion, with a growth rate of 14.91%. The total number of electronic
+social security cards issued by the Bank amounted to 8.2999 million.
+Boosting rural revitalisation
+Fully capitalising on the strategic opportunities arising from rural revitalisation, the Bank
+formulated the Action Plan for Rural Revitalisation of Bank of China and the Action Plan for
+the Business Development of County-level Finance of Bank of China, established the Rural
+Revitalisation Finance Department at the Head Office, and optimised the organisational
+structure for rural revitalisation in its domestic institutions. It accelerated the allocation of
+professional personnel, and actively participated in the county-level economic development
+and the building of a rural financial service system, aiming to boost rural revitalisation through
+sustained financing flows. Making full use of its advantages in integrated operations, the Bank
+established a rural financial service system featuring “unity in diversity”. Within this system,
+BOC Fullerton Community Bank has set up 126 village banks nationwide in line with its
+development philosophy of "focusing on county area development, supporting farmers and
+small-sized enterprises”, becoming the largest domestic village bank group in terms of number
+of institutions and business scope. The Bank also made huge efforts to innovate products and
+services and launched the "Inclusive Loan • New Agriculture Connect", "Inclusive Loan
+Farmland Loan” and “Inclusive Loan MSE Benefit Loan" service programmes, focusing on
+supporting new agricultural business entities as well as enterprises engaged in high-standard
+farmland construction and agricultural product processing with diversified and multi-level
+financial services. As at the end of 2021, the balance of the Bank's agriculture-related loans
+stood at RMB1,740.8 billion, up 15.8% from the beginning of the year. The balance of inclusive
+agriculture-related loans registered RMB 188.8 billion, up 46% from the beginning of the year.
+•
+The Bank actively implemented national requirements for consolidating and expanding the
+effective connection of achievements of poverty alleviation and rural revitalisation and leveraged
+its financial strength to promote rural revitalisation of areas under the paired assistance projects.
+As the designated entity for providing paired assistance to the four counties of Yongshou, Xunyi,
+Chunhua and Changwu in Xianyang, Shaanxi Province (the "four counties in Xianyang"), the
+Bank followed the guiding principles of General Secretary Xi Jinping's important speeches and
+instructions on rural revitalisation and paired assistance, implemented the decisions and plans
+of the CPC Central Committee and the State Council on all fronts, strictly implemented the
+requirements of shaking off no responsibilities, policies, assistance and regulations even when
+poverty has been shaken off, and made every effort to provide paired assistance to the four
+counties in Xianyang, with all tasks progressing steadily. In 2021, the Bank directly invested
+and introduced RMB 107 million of anti-poverty grant funding to the four counties in Xianyang,
+implemented nearly 100 various assistance projects, including livelihood projects, industrial
+assistance and infrastructure construction, organised training courses for 28.9 thousand primary-
+level officials, rural revitalisation leaders and professional and technical personnel from the four
+counties in Xianyang, and purchased or sold RMB177 million worth of agricultural products of
+the poverty-stricken areas, directly benefiting over 30,000 people.
+127
+129
+In 2021, the COVID-19 pandemic was basically under control in the Chinese mainland, with
+high clusters and sporadic outbreaks in some areas across the country. In comparison, overseas
+outbreaks continued to occur frequently, with the prevention and control situation remaining grim
+and complex. The Bank continued to improve its business continuity management system, and
+formulated the Distribution and Operation Business Continuity Plan of Bank of China Limited
+(Version 2021), which standardised its procedures and requirements for response, disposal and
+recovery in the event of interruptions to its channels and operations, clarified the management
+responsibilities of branches, required daily monitoring as well as efficient epidemic prevention
+and control in local outlets during major events or statutory holidays. To reduce the risks
+associated with the pandemic, the Bank implemented a national centralised transaction processing
+service for corporate loan transactions. Through the development of relevant systems, the
+transaction processing workload of pandemic-affected branches could be directly undertaken by
+other branches, thus effectively ensuring continuity in credit operation.
+Responding to challenges of the pandemic
+In 2021, in response to extreme weather and flood disasters in Henan, Shanxi and Shaanxi
+provinces, the Bank took immediate actions to donate funds and support rescue efforts, while
+continuing to provide financial services to disaster-hit areas, making its contribution to flood
+control, relief and post-disaster reconstruction. After the disaster hit Henan Province, the Bank
+donated RMB20 million to the province on July 26. Through the “Bank of China Philanthropy"
+platform, the Bank launched five fundraising activities, with 4,459 people donating RMB377.1
+thousand. After the floods in Shanxi and Shaanxi provinces, it launched three charity fundraising
+activities, with more than 6,800 people donating RMB915.6 thousand.
+The Bank actively promoted the public service platform of mutual aid for the elderly, advocated
+the mutual pension concept and model of “saving time of assisting the elderly to exchange for
+pension services". It helped local governments to foster a cultural norm of caring for the elderly,
+improved the voluntary service system, and standardised urban and community governance,
+thus improving wellbeing and happiness among the elderly. As at the end of 2021, the Bank had
+cooperated with more than 70 government departments, enterprises, social organisations and
+universities, reaching more than 210,000 elderly people and volunteers with a total service time
+of more than 5,800 hours.
+128
+124
+The "Bank of China Philanthropy”, established by BOC, is an online fundraising information platform for
+charitable organisations selected by the Ministry of Civil Affairs of the PRC.
+Upholding the principles of "serving society, contributing to society and repaying society”, the
+Bank actively cooperated with charitable social organisations and organised various charitable
+fundraising activities by relying on public welfare vehicles such as BOC Charity Foundation,
+the "Bank of China Philanthropy”12 platform and Zhongyi Shanyuan, for the purpose of
+mobilising warm-hearted people from the Bank and wider society to participate in poverty
+alleviation and public welfare undertakings. In 2021, the “Bank of China Philanthropy” platform
+actively explored the integrated development of online public welfare and the Bank's financial
+businesses, with a focus on poverty alleviation, flood relief, rural revitalisation, talent cultivation
+in universities, education aid, elderly care and so on. Moreover, the Bank participated in 188
+public welfare programmes initiated by 73 organisations, raising a total of RMB17.3631 million
+(including the Bank's matching funds), with nearly 160,000 people involved in donations, further
+gathering the warm hearts of the Bank's staff, customers and institutions as well as the general
+public. The BOC Charity Foundation and the “Bank of China Philanthropy” platform also jointly
+launched the "BOC Love” campaign, introducing ten charity programmes from six charitable
+organisations to the four counties in Xianyang. A total of 66 thousand people from the public
+society participated in the campaign, bringing in RMB6.40 million of donations.
+Contributing to public welfare
+In 2021, the Bank's external customer satisfaction rate reached 93%, the same as last year. The
+number of customer complaints reached 148 thousand, a decrease of 21.1% year on year. The
+complaint handling completion rate stood at 100%. In addition, the total amount of suspicious
+transactions intercepted by the Bank's “Cyber Defence" system during the year surpassed
+RMB15.070 billion.
+•
+Practising its "customer-centric” operation and management concept, the Bank fully integrated
+consumer protection into its corporate culture, effectively fulfilled its responsibilities and
+obligations to protect the rights and interests of financial consumers, and promoted the healthy
+development of business through ensuring consumer rights and interests, thus enhancing
+customer satisfaction. In terms of complaint management, the Bank continuously fulfilled
+its responsibilities, streamlined its service processes, improved customer service experience
+and effectively protected the legitimate rights and interests of consumers, with the number of
+complaints declining. In terms of the education and publicity of financial knowledge, the Bank
+launched publicity and education activities in various interesting forms themed on “3.15 Rights
+Responsibilities •Risks, Financial Consumer Rights Day”, the “Promoting Financial Knowledge,
+Protecting Personal Wealth”, the “Financial Knowledge Popularisation" and the “Month of
+Financial Knowledge Popularisation" as well as regular consumer publicity and education
+campaigns through online and offline channels such as official website, WeChat official account
+and outlets, which were recognised by regulatory authorities and consumers.
+Ensuring the rights and interests of customers
+12
+social risks
+Two-list management requirements for environmental and
+Statistics caliber is in accordance with Corporate Social Responsibility Report of Bank of China Limited for 2021
+(Environmental Social Governance).
+5.12
+Refer to the eight emission control industries that have been included and are to be included in the carbon market
+as per national standards and the coal industry, specifically, coal, thermal power generation, steel, petrochemicals,
+chemicals, non-ferrous metals, cement, paper making and civil aviation.
+123
+Others
+>90%
+Others Coal
+■Cement Steel
+■Civil aviation
+Brown credits
+<10%
+Coal
+Paper manufacturers
+Petrochemicals
+Chemicals
+Cement
+Non-ferrous metals
+Thermal power generation
+Civil aviation
+■Petrochemicals
+■Paper manufacturers
+■Chemicals
+■Non-ferrous metals ■Thermal power generation
+The Bank is committed to green operation. It strengthened management to save energy and
+reduce its consumption, and decreased the use of water, power, paper, oil and other resources in
+work, hence raising energy efficiency. As the exclusive official banking partner of 2022 Beijing
+Winter Olympics, the Bank implemented the “Green Olympics" concept and realised carbon
+neutralisation in delivering financial services.
+The Bank has completed the operation emission calculation10, covering over 11,000 branches and
+comprehensive operation companies in the Chinese mainland and 62 countries and regions. The
+calculated data will be used to support the carbon neutralisation plan for operation of the BOC
+Group and is shown below¹¹:
+4.89
+4.99
+Greenhouse gas emissions intensity per FTE
+(tCO2e/FTE)
+2,825,765
+1,587,180
+2,717,945
+1,512,554
+1,534,060
+The GHG Protocol formulated by the World Resources Institute and the World Business Council for Sustainable
+Development classifies corporate carbon emissions into scopes 1, 2 and 3. The Bank's operational control covers
+scopes 1 and 2 of the GHG Protocol.
+2,754,463
+2019
+2020
+2021
+Indicators
+11
+10
+Total energy consumption (MWh)
+Greenhouse gas emissions (tCO2e)
+industries
+Management Plan for Credits Granted to "Two Highs
+Steel
+Industrial Policies
+Global Markets
+Department
+Consumer Finance
+☐ Digital Personal Banking
+Department
+Revitalisation
+Department (Rural
+Inclusive Finance
+Finance
+Department)
+Banking Department
+Global Transaction
+Corporate Banking
+Man
+Department
+Management Department
+Department
+Asset & Liability
+Investment banking and
+Department
+businesses
+Risks weight policies for green finance and other
+Environmental and Social Responsibilities
+In 2021, the Bank actively undertook its responsibilities and missions as a major state-owned
+bank and integrated environmental, social and governance (ESG) concepts into all facets of its
+business management. Committed to deepening reform on all fronts and promoting business
+transformation, it made continuous efforts to strengthen the adaptability, competitiveness and
+inclusiveness of its financial services, and effectively enhanced its capabilities and performance
+in terms of serving the economic, social and environmental development, with the aim of creating
+value together with stakeholders while achieving high-quality and sustainable development.
+Environment Responsibilities
+Governance Structure
+The Bank has placed great importance on green finance, and continuously improved its
+governance structure. In early 2021, the Bank set up the Steering Group for Green Finance and
+Industrial Planning and Development at the Group level that is led by the Chairman of the Board
+of Directors. In 2021, four Steering Group meetings were organised to study and communicate
+the national green finance policies and review the Group's major green finance strategies and
+policies. The Board of Directors regularly reviewed issues related to green finance, guided and
+supervised major green finance tasks. It also heard the report on green finance development
+in 2020, reviewed and approved the Bank's 14th Five-Year Plan for Green Finance, covering
+the development of green finance business, environmental and social risk management and
+the Bank's green performance. The Bank incorporated green development, the environmental
+and social risk management and other factors into the performance appraisal system for senior
+staff, and allocated resources for green finance business to ensure the efficacy of green finance
+management. The Green Finance Committee was set up under the Executive Committee, with
+the President acting as the committee chairman, to advance the green finance work. The Bank
+continuously strengthened the building of a professional team, and created full-time/part-time
+green finance roles or set up teams in each branch/subsidiary.
+Secretariat
+Strategic Development
+Committee
+Regularly review the
+green finance strategy and
+Business/Product Departments
+Board of Directors
+Senior Management
+(Executive Committee)
+Green Finance Committee
+Bank Card Center
+Asset Management
+Department
+its implementation
+Green Finance Team
+Overseas institutions
+120
+Strategy and Policy Systems
+With the aim to achieve the national goal of "peak carbon emissions and carbon neutrality”, the
+Bank established a “1+1+N” green finance policy system and conducted the in-depth analysis
+over green finance development associated opportunities and challenges faced by the Bank. It
+developed the 14th Five-Year Plan of Bank of China for Green Finance, which put forward four
+strategic objectives, namely, striving to become the bank of choice for green finance services,
+achieving leapfrog development of green finance business, properly managing environmental and
+social risks, and formulating the carbon neutrality action plan for operation and asset portfolios,
+as so to create a "One Body with Two Wings" pattern for green finance. The Bank rolled out
+Bank of China Action Plan for Reaching the Goal of "Peak Carbon Emissions and Carbon
+Neutrality", setting detailed roadmaps in 15 aspects including organisational structure, business
+development strategy, product innovation, green operation, stress test, international cooperation,
+capacity building and technology empowerment, to form a solid basis of green finance policy
+system with multiple pillars. Furthermore, the Bank enhanced support for green finance in
+terms of differentiated authorisation, innovative mitigation methods, optimisation of risk weight
+and economic capital management, green approval channel and preferential price application.
+It formulated credit management policies to target high energy consumption and high carbon
+emission ("Two Highs") industries in China, strengthened credit structural adjustment, and
+put restrictions on blind expansions of projects in "Two Highs" industries. The Bank also took
+stringent management and control measures on financing new coal mining and coal-fired power
+projects outside of China, and ceased to provide financing for those projects from Q4 2021,
+except for contracted projects.
+Z
+Green Credit
+Operating Procedures for Statistical Table on
+Catalogue
+Standards for Classification of Green Industry Guidance
+Risk Classification System
+Requirement for Labeling of Environmental and Social
+Business Development
+14th Five-Year Plan for Green Finance
+Bank of China Action Plan for Reaching the Goal of "Peak Carbon Emissions and Carbon Neutrality"
+Environmantal and
+Social Risk Management
+Data Standards and
+Credit Management
+Systems
+Set up the institution's green finance committee or working group, team or full-time/part-time personnel engaged in relevant work
+Comprehensive operation companies
+Policy system
+Globalisation Office
+Board Secretariat
+Domestic branches
+------
+Chaired by President
+Risk Policy
+Committee
+Management and Functional Departments
+Executive Office
+Institute of Bank of China¦
+Regularly review the Bank's
+environmental and social risk
+management and other topics
+Information Technology
+Management Department
+Digital Asset
+Department
+Department
+Credit Approval
+Management Department
+Distribution and Operation i
+Department
+Risk Management
+Product R&D Center
+Department
+Subsidiary Management
+Equity Investment and
+Asset
+person
+Preference Shares
+3
+CCB Trust Co., Ltd. - "Qian Yuan-Ri Xin Yue Yi"
+Open-ended Wealth Management Single Fund Trust
+133,000,000
+None
+Unknown Foreign legal Offshore
+Other
+Domestic
+11.10%
+16.52%
+Type of
+Bank of New York Mellon Corporation
+2
+Preference Shares
+Domestic
+Other
+preference
+shares
+Number
+of shares
+pledged Type of
+shareholder
+or frozen
+None
+16.70%
+200,000,000
+Preference Shares
+shares
+197,865,300
+4
+6
+119,460,000
+period
+― He Xiang Tian Li No.1 Collective Capital Trust Plan
+Domestic
+Other
+None
+4.55%
+54,540,000
+Term of office as Director
+54,540,000
+Jiangsu International Trust Corporation Limited - JSITC
+Preference Shares
+-general insurance product-005L - CT001SH
+Domestic
+None Other
+5.84%
+70,000,000
+(3,000,000)
+China Life Insurance Company Limited - traditional
+5
+Preference Shares
+Domestic
+Other
+None
+9.97%
+119,460,000
+Hwabao Trust Co., Ltd. - Hwabao Trust - Baofu
+Investment No.1 Collective Capital Trust Plan
+period
+(10,000,000)
+14
+1
+567
+17
+16
+40.11%
+China International Capital Corporation Limited ★✩
+Preference Shares
+20.05%
+Shenwan Hongyuan Group Co., Ltd. ★☆
+13
+69.07%
+China Galaxy Financial Holding Co., Ltd.
+12
+100.00%
+China Jianyin Investment Limited
+11
+31.34%
+New China Life Insurance Company Limited ★☆
+10
+71.56%
+China Reinsurance (Group) Corporation ✩
+9
+73.63%
+China Export & Credit Insurance Corporation
+8
+53.95%
+15 China Securities Co., Ltd. ★✩
+Bosera Fund ICBC - Bosera - ICBC - Flexible
+Allocation No. 5 Specific Multi-customer Assets
+Management Plan
+30.76%
+13.30%
+No. Name of preference shareholder
+Percentage
+of total
+preference
+Number of
+Changes shares held
+during as at the end
+the reporting of the reporting
+Unit: Share
+The top ten preference shareholders as at 31 December 2021 are set forth below:
+The number of preference shareholders as at the end of the last month before the disclosure of
+this report was 70, including 69 domestic preference shareholders and 1 offshore preference
+shareholder.
+The number of preference shareholders as at 31 December 2021 was 68, including 67 domestic
+preference shareholders and 1 offshore preference shareholder.
+Number of Preference Shareholders and Shareholdings
+136
+For the terms of issuance of the Domestic Preference Shares and Offshore Preference Shares,
+please refer to the Bank's announcements published on the websites of SSE, HKEX and the
+Bank.
+With the approvals of CBIRC (Yinbaojianfu [2019] No. 630) and CSRC (Zhengjianxuke [2020]
+No. 254), the Bank made a non-public issuance of USD2.820 billion Offshore Preference Shares
+(Second Tranche) on 4 March 2020 in the offshore market. The Offshore Preference Shares
+(Second Tranche) have been listed on the Hong Kong Stock Exchange since 5 March 2020.
+With the approvals of CBIRC (Yinbaojianfu [2019] No. 387) and CSRC (Zhengjianxuke
+[2019] No. 1051), the Bank made a non-public issuance of RMB73 billion Domestic Preference
+Shares (Third Tranche) on 24 June 2019 in the domestic market. With the approval of SSE
+(Shangzhenghan [2019] No. 1164), Domestic Preference Shares (Third Tranche) have been traded
+on the Comprehensive Business Platform of SSE since 17 July 2019. The Bank made a non-
+public issuance of RMB27 billion Domestic Preference Shares (Fourth Tranche) on 26 August
+2019 in the domestic market. With the approval of SSE (Shangzhenghan [2019] No. 1528),
+Domestic Preference Shares (Fourth Tranche) have been traded on the Comprehensive Business
+Platform of SSE since 17 September 2019.
+Issuance and Listing of Preference Shares in the Past Three Years
+Preference Shares
+Non-executive Directors Ms. XIAO Lihong, Ms. WANG Xiaoya, Mr. ZHANG Jiangang, and Mr.
+CHEN Jianbo were recommended by Huijin, shareholder of the Bank.
+As at 31 December 2021, no other legal-person shareholder held 10% or more voting shares of
+the Bank (excluding HKSCC Nominees Limited).
+For further details regarding China Investment Corporation, please refer to the information on
+its website (www.china-inv.cn). Please refer to the Announcement on Matters Related to the
+Incorporation of China Investment Corporation published on 9 October 2007 by the Bank for
+relevant information of China Investment Corporation.
+Besides the above companies controlled or held by Huijin, Central Huijin Asset Management Ltd. is a wholly-
+owned subsidiary of Huijin. Central Huijin Asset Management Ltd., established in November 2015 and registered
+in Beijing with registered capital of RMB5 billion, provides asset management business.
+2
+★ denotes A share listed company and denotes H share listed company.
+1
+Notes:
+135
+14.54%
+Guotai Junan Investment Management Co., Ltd.
+China Galaxy Asset Management Co., Ltd.
+7
+1
+(4,980,000)
+1965
+Vice Chairman and
+President
+Executive Director and
+Executive Vice President
+Executive Director and
+Executive Vice President
+Female Non-executive Director
+WANG Xiaoya
+1964
+Female Non-executive Director
+ZHANG Jiangang 1973
+Male
+Non-executive Director
+CHEN Jianbo
+1963
+Male
+Non-executive Director
+WANG Changyun 1964
+Male
+Independent Director
+Angela CHAO
+During the reporting period, there was no conversion into ordinary shares or voting rights
+recovery in respect of the preference shares of the Bank.
+1973
+Female Independent Director
+JIANG Guohua
+1971
+Male
+Independent Director
+Martin Cheung
+1957
+XIAO Lihong
+Male
+Male
+LIN Jingzhen
+The funds raised from the issuance of the Domestic Preference Shares and Offshore Preference
+Shares have been fully used to replenish the Bank's additional tier 1 capital and increase its
+capital adequacy ratio.
+Issuance of Other Securities
+Please refer to Note V.30 to the Consolidated Financial Statements for details of bonds issued by
+the Bank.
+No shares of the Bank have been specifically issued to its employees.
+138
+Directors, Supervisors and Senior Management Members
+Basic Information
+Evergrowing Bank Co., Limited
+Incumbent Directors, Supervisors and Senior Management Members
+Incumbent Directors
+Year of
+Name
+birth
+Gender Position
+LIU Liange
+1961
+Male
+Chairman
+LIU Jin
+1967
+Preference shares issued by the Bank contain no contractual obligation to deliver cash or another
+financial asset; or to exchange financial assets or financial liabilities with another entity under
+conditions that are potentially unfavourable to the entity. Preference shares issued are non-
+derivative instruments that will be settled in the entity's own equity instruments, but includes no
+contractual obligation for the entity to deliver a variable number of its own equity instruments.
+The Bank classifies preference shares issued as an equity instrument. Fees, commissions and
+other transaction costs arising from preference shares issuance are deducted from equity. The
+dividends on preference shares are recognised as profit distribution at the time of declaration.
+Male
+WANG Wei
+1963
+Male
+1965
+BOCOM Schroder Asset Management - BOCOM -
+Independent Director
+CHEN Chunhua
+Preference Shares
+legal person
+Domestic
+None State-owned
+2.50%
+30,000,000
+Shanghai Tobacco Group Co., Ltd.
+9
+Preference Shares
+legal person
+Domestic
+State-owned
+None
+3.34%
+40,000,000
+Postal Savings Bank of China Co., Ltd.
+8
+No. 2 Collective Asset Management Plan
+Preference Shares
+BOCOM Schroder Asset Management Zhuoyuan
+Domestic
+Other
+None
+4.54%
+54,400,000
+9
+Kong LIAO
+Ping An Life Insurance Company of China - universal
+―individual universal insurance
+30,000,000
+1964
+Female Independent Director
+CHUI Sai Peng
+1960
+Male
+Independent Director
+Jose
+139
+Other Information regarding the Preference Shares
+On 15 March 2021, the Bank redeemed all 280,000,000 shares of the Domestic Preference
+Shares (Second Tranche) issued on 13 March 2015. For details, please refer to the Bank's
+announcements published on the websites of SSE, HKEX and the Bank.
+Exercising Redemption Rights of Preference Shares
+For the profit distribution policy of the preference shares and the profit distribution arrangement
+during the reporting period, please refer to the section “Report of the Board of Directors”.
+Profit Distribution of Preference Shares
+137
+Save as disclosed above, the Bank is not aware of any connected relation or concerted action among the
+aforementioned preference shareholders, or among the aforementioned preference shareholders and the Bank's top
+ten ordinary shareholders.
+As at 31 December 2021, "China Life Insurance Company Limited ― traditional general insurance product-
+005L CT001SH" is one of both the Bank's top ten ordinary shareholders and top ten preference shareholders.
+The Bank of New York Mellon Corporation, acting as the custodian for all the offshore preference shareholders
+that maintain accounts with Euroclear and Clearstream as at 31 December 2021, held 197,865,300 Offshore
+Preference Shares, representing 100% of the Offshore Preference Shares.
+3
+2
+Notes:
+Preference Shares
+Domestic
+Other
+None
+2.50%
+(7,000,000)
+7
+Intensifying Efforts in Anti-Corruption and Building a Clean Bank
+China Everbright Group Ltd.
+China Securities Finance Co., Ltd.
+3
+person
+Unknown Foreign legal H
+27.80%
+(52,922,305) 81,849,088,685
+HKSCC Nominees Limited
+2
+ordinary
+shares
+A
+State
+None
+64.02%
+188,461,533,607
+Central Huijin Investment Ltd.
+1
+shareholder
+frozen
+Type of
+From October 2018 to the date of the
+Annual General Meeting in 2024
+shares
+pledged,
+labelled or Type of
+Number of
+shares subject
+to selling
+restrictions
+shares
+period
+ordinary
+reporting of the reporting
+period
+(654,880,040) 7,941,164,885
+No. Name of ordinary shareholder
+2.70%
+A
+382,238,605
+China Pacific Life Insurance Co., Ltd. -
+7
+person
+Unknown Foreign legal H
+person
+0.18%
+520,357,200
+MUFG Bank, Ltd.
+6
+None Foreign legal A
+0.36%
+1,067,361,975
+255,524,716
+HKSCC Limited
+5
+legal person
+A
+State-owned
+None
+0.61%
+1,810,024,500
+Central Huijin Asset Management Ltd.
+4
+legal person
+None State-owned
+0.13%
+Percentage of
+total
+Number of
+shares held
+as at the end
+shares Percentage
+Subtotal
+Others
+reserve
+shares
+shares
+Percentage
+Number of shares
+Number of
+from surplus
+Bonus
+of new
+Shares
+transferred
+Issuance
+As at 31 December 2021
+Unit: Share
+Increase/decrease during the reporting period
+As at 1 January 2021
+Changes in Ordinary Shares
+Ordinary Shares
+Changes in Shares and Shareholdings of Shareholders
+130
+For details of the Bank's environmental, social and governance performance, please refer to the
+Corporate Social Responsibility Report of Bank of China Limited for 2021 (Environmental Social
+Governance).
+Attaching great importance to the integrity building and anti-corruption supervision of its
+overseas institutions, the Bank established a leading mechanism for integrity risk prevention
+and control and corruption governance in its overseas institutions. The overseas institutions
+strengthened their anti-corruption efforts and risk prevention and control in the light of the actual
+situation in local countries and regions. It enhanced education and supervision, and continuously
+promoted a strong atmosphere of integrity and compliance in its overseas institutions. Moreover,
+it established and improved the supervision system for the integrity of its overseas institutions,
+introduced management measures, stepped up efforts of supervision and promoted the
+implementation of the requirements of building a clean bank.
+The Bank was committed to preventing integrity risk, resolutely punished corruption, established
+a sound monitoring and restraint mechanism for key areas such as credit management, non-
+performing loan disposal and centralised procurement, and kept a tough anti-corruption stance.
+It deepened the building of a long-effect anti-corruption mechanism, adhered to the principle of
+"not daring to corrupt, not being able to corrupt and not wanting to corrupt”, promoted Bank-
+wide special prevention and control, stepped up the investigation and punishment of violations
+of laws and disciplines, and improved the mechanism of power restriction. Carrying forward its
+excellent clean culture of “loftiness, clean and determination”, the Bank extensively carried out
+the cultivation of an integrity culture, continuously conducted warning education, held special
+warning education conferences, and compiled and published typical cases, thus consolidating the
+ideological foundation of the whole staff to resist corruption and prevent degeneration.
+I. Shares subject to selling restrictions
+Number of
+-
+II. Shares not subject to selling restrictions
+Changes
+during the
+Unit: Share
+The top ten ordinary shareholders as at 31 December 2021 are set forth below:
+The number of ordinary shareholders as at the end of the last month before the disclosure of this
+report was 705,350, including 530,665 A-Share Holders and 174,685 H-Share Holders.
+The number of ordinary shareholders as at 31 December 2021 was 728,790, including 553,596
+A-Share Holders and 175,194 H-Share Holders.
+Number of Ordinary Shareholders and Shareholdings
+131
+As at 31 December 2021, none of the Bank's A Shares and H Shares were subject to selling restrictions.
+2
+As at 31 December 2021, the Bank had issued a total of 294,387,791,241 ordinary shares, including
+210,765,514,846 A Shares and 83,622,276,395 H Shares.
+1
+Notes:
+83,622,276,395 28.41%
+294,387,791,241 100.00%
+-
+71.59%
+210,765,514,846
+294,387,791,241 100.00%
+-
+294,387,791,241 100.00%
+III. Total Ordinary Shares
+28.41%
+83,622,276,395
+2. Overseas listed foreign shares
+294,387,791,241 100.00%
+210,765,514,846 71.59%
+1. RMB-denominated ordinary shares
+-
+63.16%
+None Other
+China Pacific Life Insurance Dividend Equity
+Portfolio (Traditional) with management of
+Changjiang Pension Insurance Co., Ltd.
+Notes:
+0.002%
+0.01%
+1.67%
+5.89%
+H
+4,928,555,441
+5,735,000 (S) H
+Interest of controlled
+corporations
+1.97%
+6.93%
+64.63%
+90.28%
+190,271,558,107 A
+5,798,893,213 H
+Beneficial owner
+National Council for
+Social Security Fund
+BlackRock, Inc.
+Total
+0.61%
+0.86%
+1,810,024,500 A
+Interest of controlled
+corporations
+64.02%
+89.42%
+188,461,533,607 A
+shares
+H Shares
+1
+A Shares
+BlackRock, Inc. holds the entire issued share capital of BlackRock Holdco 2 Inc., while BlackRock Holdco
+2 Inc. holds the entire issued share capital of BlackRock Financial Management, Inc. Thus BlackRock,
+Inc. and BlackRock Holdco 2 Inc. are deemed to have equal interests in shares of the Bank as BlackRock
+Financial Management, Inc. under the SFO. BlackRock, Inc. held a long position of 4,928,555,441 H Shares
+and a short position of 5,735,000 H Shares of the Bank through BlackRock Financial Management, Inc. and
+other corporations controlled by it. In the long position of 4,928,555,441 H Shares, 8,736,000 H Shares were
+held through derivatives. In the short position of 5,735,000 H Shares, 2,466,000 H Shares were held through
+derivatives.
+"S" denotes short position.
+6
+57.11%
+China Construction Bank Corporation ✰✰
+5
+64.02%
+Bank of China Limited ★☆
+40.03%
+Agricultural Bank of China Limited ✩✩
+3
+34.71%
+Industrial and Commercial Bank of China Limited ★✩
+34.68%
+China Development Bank
+1
+capital held by Huijin
+Company name
+No.
+Proportion of the total
+As at 31 December 2021, the basic information of companies directly held by Huijin is as
+follows:
+Central Huijin Investment Ltd. (“Huijin”) is a state-owned investment company established on
+16 December 2003 under the Company Law, with Mr. PENG Chun as its legal representative.
+Wholly owned by China Investment Corporation ("CIC"), Huijin makes equity investments in
+major state-owned financial institutions, as authorised by the State Council. To the extent of its
+capital contribution, Huijin exercises its rights and fulfills its obligations as an investor to major
+state-owned financial institutions on behalf of the State, in accordance with applicable laws aimed
+at preserving and enhancing the value of state-owned financial assets. Huijin neither engages in
+other business activities nor intervenes in the daily operation of the major state-owned financial
+institutions of which it is the controlling shareholder.
+Central Huijin Investment Ltd.
+Controlling Shareholder of the Bank
+134
+Unless stated otherwise, all interests stated above represented long positions. Save as disclosed above, as at 31
+December 2021, no other interests (including derivative interests) or short positions were recorded in the register
+maintained by the Bank under section 336 of the SFO.
+3
+2
+A
+(unit: share) shares
+total issued
+legal person
+state-owned
+Domestic non- A
+None
+0.05%
+133,000,000
+133,000,000
+Beijing Yuantong Xinhai Trading Co., Ltd.
+10
+legal person
+state-owned
+Domestic non- A
+None
+0.05%
+152,000,037
+152,000,037
+Beijing Dadi Yuantong Group Co., Ltd.
+9
+Other
+None
+0.11%
+335,393,250
+(377,295,920)
+China Life Insurance Company Limited -
+traditional general insurance product
+―005L CT001SH
+8
+132
+ordinary
+Notes:
+2
+total issued
+Percentage of
+total issued
+Percentage of
+Percentage of
+shares Type of
+underlying
+Capacity
+(types of interest)
+Beneficial owner
+Central Huijin Investment Ltd.
+Name of shareholder
+Number of
+shares held/
+Number of
+The register maintained by the Bank under section 336 of the SFO recorded that, as at 31
+December 2021, the shareholders indicated in the following table were substantial shareholders
+having interests in shares of the Bank (as defined in the SFO):
+Substantial Shareholder Interests
+133
+Save as disclosed above, the Bank is not aware of any connected relation or concerted action among the
+aforementioned ordinary shareholders.
+Beijing Yuantong Xinhai Trading Co., Ltd. is a wholly-owned subsidiary of Beijing Dadi Yuantong Group Co.,
+Ltd. As at 31 December 2021, Beijing Dadi Yuantong Group Co., Ltd. held 152,000,037 ordinary shares of the
+Bank, including 147,000,000 ordinary shares of the Bank held through investor credit account. Beijing Yuantong
+Xinhai Trading Co., Ltd. held 133,000,000 ordinary shares of the Bank, all of which were held through investor
+credit account.
+The number of shares held by HKSCC Limited is the aggregate number of the A Shares it held as the nominee
+holder who holds securities on behalf of others, including the number of SSE securities acquired by Hong Kong
+and overseas investors through Shanghai-Hong Kong Stock Connect.
+6
+5
+4
+Central Huijin Asset Management Ltd. is a wholly-owned subsidiary of Central Huijin Investment Ltd.
+3
+The number of shares held by HKSCC Nominees Limited is the aggregate number of the Bank's H Shares it held
+as the nominee for all the institutional and individual investors that maintain accounts with it as at 31 December
+2021, including the number of shares held by the National Council for Social Security Fund.
+The number of shares held by H-Share Holders was recorded in the register of members kept at the H-Share
+Registrar of the Bank.
+1
+A
+From June 2021 to the date of the
+Annual General Meeting in 2024
+From June 2020 to the date of the
+Annual General Meeting in 2023
+From February 2019 to the date of the
+Annual General Meeting in 2024
+From August 2017 to the date of the
+Annual General Meeting in 2023
+From August 2017 to the date of the
+Annual General Meeting in 2023
+From July 2019 to the date of the
+Annual General Meeting in 2022
+From June 2020 to the date of the
+Annual General Meeting in 2023
+From August 2016 to the date of the
+Annual General Meeting in 2022
+From January 2017 to the date of the
+Annual General Meeting in 2022
+From December 2018 to the date of
+the Annual General Meeting in 2024
+From September 2019 to the date of
+the Annual General Meeting in 2022
+From July 2020 to the date of the
+Annual General Meeting in 2022
+From September 2020 to the date of
+the Annual General Meeting in 2022
+From December 2018 to November
+2021
+From November 2016 to January
+2021
+WANG Zhiheng
+1973
+Male
+LI Changlin
+1962
+Male
+Employee Supervisor
+Employee Supervisor
+From December 2018 to June 2021
+ZHENG Guoyu
+1967
+Male
+LIU Qiuwan
+1961
+93.17
+21.67
+5.42
+120.26
+No
+of Directors and
+Company Secretary
+Chairman of the Board of
+Supervisors
+142
+Male
+WANG Xiquan
+Note: No incumbent director, supervisor or senior management member held any share of the Bank.
+140
+Former Directors, Supervisors and Senior Management Members
+Year of
+Position held before
+Name
+birth
+Gender
+leaving the post
+Term of office
+WANG Jiang
+1963
+Male
+Vice Chairman and
+From January 2020 to February 2021
+ZHAO Jie
+1962
+Male
+President
+Non-executive Director
+From August 2017 to March 2022
+1960
+Company Secretary from March
+2018 and Secretary to the Board of
+Directors from April 2018
+Remuneration before tax from the Bank in 2021
+Employer
+Non-executive Director
+Yes
+WANG Xiquan
+Chairman of the Board
+5.16
+1.67
+6.83
+No
+of Supervisors
+WANG Zhiheng
+Employee Supervisor
+2.50
+2.50
+No
+LI Changlin
+Employee Supervisor
+4.58
+4.58
+No
+ZHENG Guoyu
+Executive Vice President
+ZHAO Jie
+(Unit: RMB ten thousand)
+No
+1.67
+contribution to
+social insurance,
+enterprise
+annuity,
+supplementary
+medical
+insurance
+Remunerated by
+shareholding
+companies or
+Remuneration
+and housing Other monetary
+other connected
+Name
+Position
+paid
+provident fund
+income
+Total
+parties
+Former Directors, Supervisors and Senior Management Members
+WANG Jiang
+Vice Chairman and President
+5.16
+6.83
+37.16
+From August 2021
+| From February 2019
+From May 2021
+From March 2018
+CHEN Huaiyu
+External Supervisor
+HUI Ping
+No
+26.00
+26.00
+External Supervisor
+ZHENG Zhiguang
+No
+26.00
+26.00
+External Supervisor
+Incumbent Supervisors
+Year of
+Name
+birth
+Gender Position
+ZHANG Keqiu
+1964
+WEI Hanguang
+1971
+Executive Vice President
+Female Chairwoman of the Board
+of Supervisors
+Female Employee Supervisor
+41.81
+56.45
+No
+81.11
+1.40
+14.49
+65.22
+Chief Audit Officer
+ZHUO Chengwen
+No
+121.51
+2.00
+21.67
+97.84
+Chief Risk Officer
+LIU Jiandong
+No
+31.39
+5.00
+23.23
+Executive Vice President
+WANG Zhiheng
+No
+14.64
+From April 2021
+ZHOU Hehua
+Male
+Gender Position
+LIU Jin
+1967
+Male
+Vice Chairman, President
+WANG Wei
+1963
+Male
+LIN Jingzhen
+1965
+Male
+CHEN Huaiyu 1970
+Male
+WANG Zhiheng 1973
+LIU Jiandong
+ZHUO Chengwen 1970
+MEI Feiqi
+Male
+1969 Male
+Male
+1962
+Male
+Executive Director and
+Executive Vice President
+Executive Director and
+Executive Vice President
+Executive Vice President
+Executive Vice President
+Chief Risk Officer
+Chief Audit Officer
+Secretary to the Board of
+Directors and Company
+Secretary
+Term of office as Senior
+Management Member
+From April 2021
+From December 2019
+birth
+1975
+Name
+Incumbent Senior Management Members
+Employee Supervisor
+LENG Jie
+1963
+Male
+Employee Supervisor
+JIA Xiangsen
+1955
+Male
+External Supervisor
+ZHENG Zhiguang 1953
+Male
+External Supervisor
+HUI Ping
+1960
+Male
+External Supervisor
+Term of office as Supervisor
+From January 2021 to the date of the
+Annual General Meeting in 2024
+From November 2021 to the date
+of the 2024 Employee Delegates'
+Meeting
+From November 2021 to the date
+of the 2024 Employee Delegates'
+Meeting
+From December 2018 to the date
+of the 2024 Employee Delegates'
+Meeting
+From May 2019 to the date of the
+Annual General Meeting in 2022
+From May 2019 to the date of the
+Annual General Meeting in 2022
+From February 2022 to the date of the
+Annual General Meeting in 2025
+Year of
+MEI Feiqi
+12.97
+No
+Executive Director and
+55.74
+19.49
+75.23
+NO
+No
+Executive Vice President
+XIAO Lihong
+Non-executive Director
+Yes
+WANG Xiaoya
+Non-executive Director
+Yes
+ZHANG Jiangang
+Non-executive Director
+Yes
+CHEN Jianbo
+Non-executive Director
+Yes
+WANG Changyun
+Independent Director
+LIN Jingzhen
+60.00
+Executive Vice President
+75.24
+provident fund
+income
+Total
+parties
+Incumbent Directors, Supervisors and Senior Management Members
+LIU Liange
+Chairman
+61.94
+20.15
+82.09
+No
+LIU Jin
+Vice Chairman and President
+46.45
+15.13
+61.58
+No
+WANG Wei
+Executive Director and
+55.74
+19.50
+No
+paid
+60.00
+Angela CHAO
+ZHANG Keqiu
+Chairwoman of the Board
+61.94
+20.15
+82.09
+No
+of Supervisors
+WEI Hanguang
+Employee Supervisor
+0.83
+0.83
+No
+ZHOU Hehua
+Employee Supervisor
+0.83
+0.83
+No
+LENG Jie
+Employee Supervisor
+JIA Xiangsen
+No
+Yes
+Yes
+45.00
+Independent Director
+Independent Director
+45.00
+45.00
+Yes
+JIANG Guohua
+Independent Director
+60.00
+60.00
+Yes
+Martin Cheung Kong
+Independent Director
+45.00
+45.00
+Yes
+LIAO
+CHEN Chunhua
+Independent Director
+50.00
+50.00
+Yes
+CHUI Sai Peng Jose
+45.00
+50.13
+Position
+other connected
+The Bank incurred RMB 13.2304 million in remuneration to its directors, supervisors and senior management
+members' services in 2021.
+143
+Positions Held in Shareholding Companies by Directors, Supervisors
+and Senior Management Members
+Save as disclosed above, in 2021, none of the Bank's directors, supervisors or senior management
+members held any position in the shareholding companies of the Bank.
+Biographies of Directors, Supervisors and Senior Management
+Members
+Directors
+LIU Liange
+Chairman
+Chairman of the Board of Directors of the Bank since July 2019. Mr. LIU joined the Bank in
+2018, and served as Vice Chairman of the Board of Directors of the Bank from October 2018
+to July 2019 and President of the Bank from August 2018 to June 2019. He served as Vice
+Chairman and President of the Export-Import Bank of China from July 2015 to June 2018. Mr.
+LIU served as Vice President of the Export-Import Bank of China from March 2007 to February
+2015. He also served as Director of the African Export-Import Bank from September 2007
+to February 2015, as Chairman of the Board of Supervisors of Sino-Italian Mandarin Capital
+Partners from March 2009 to June 2015, and as Chairman of the Board of Directors of Regional
+Credit Guarantee and Investment Facility (Asia) from March 2014 to May 2015. Mr. LIU worked
+in the PBOC for many years, successively serving as Deputy Director-General of the International
+Department of the PBOC, President of the Fuzhou Central Sub-branch of the PBOC and Director
+of the Fujian Branch of the State Administration of Foreign Exchange, Director General of the
+Anti-Money Laundering Bureau (the Security Bureau) of the PBOC. Mr. LIU served as President
+of Shanghai RMB Trading Unit from October 2018 to November 2019, Vice Chairman of the
+Board of Directors of BOC Hong Kong (Holdings) Limited from December 2018 to July 2019.
+He has been serving as Chairman of the Board of Directors of BOC Hong Kong (Holdings)
+Limited since July 2019. He graduated from the Graduate School of the People's Bank of China
+with a Master's Degree in Economics in 1987. He holds the title of Senior Economist.
+LIU Jin
+Vice Chairman and President
+Vice Chairman of the Board of Directors of the Bank since June 2021 and President of the Bank
+since April 2021. Mr. LIU joined the Bank in 2021. Prior to that, Mr. LIU served as Executive
+Director of China Everbright Group from December 2019 to March 2021, President of China
+Everbright Bank from January 2020 to March 2021, and Executive Director of China Everbright
+Bank from March 2020 to March 2021. From September 2018 to November 2019, he worked
+at China Development Bank as its Executive Vice President. Mr. LIU had worked in Industrial
+and Commercial Bank of China (ICBC) for many years, serving as Deputy General Manager of
+its Shandong Branch, Vice Chairman, Executive Director, General Manager of ICBC (Europe)
+and General Manager of ICBC Frankfurt Branch, General Manager of the Investment Banking
+Department of its Head Office, and General Manager of its Jiangsu Branch. Mr. LIU began to
+serve as Vice Chairman and Non-executive Director of the Board of Directors of BOC Hong
+Kong (Holdings) Limited and Bank of China (Hong Kong) Limited as of August 2021. He
+graduated from Shandong University in 1993 with a Master of Arts degree. He holds the title of
+Senior Economist.
+144
+WANG Wei
+Executive Director and Executive Vice President
+Executive Director of the Bank since June 2020 and Executive Vice President of the Bank
+since December 2019. Mr. WANG joined the Bank in 2019. He served as Executive Director
+and Executive Vice President of Agricultural Bank of China (“ABC”) from February 2018 to
+November 2019, and began to serve as Executive Vice President of ABC from December 2013
+and as a member of senior management of ABC from December 2011. Mr. WANG previously
+served in several positions in ABC, including Deputy General Manager of Ningxia Branch,
+Deputy General Manager of Gansu Branch, General Manager of Gansu Branch, General Manager
+of Xinjiang Branch, General Manager of Xinjiang Production and Construction Corps Branch,
+General Manager of the Office of ABC, General Manager of Hebei Branch, General Manager
+of the Internal Control and Compliance Department, General Manager of the Human Resources
+Department and Chief Officer of the Sannong Business. Mr. WANG graduated from Shaanxi
+Institute of Finance and Economics in 1983, and from Southwestern University of Finance and
+Economics with a Doctor's Degree in Economics in 2015. He holds the title of Senior Economist.
+LIN Jingzhen
+Executive Director and Executive Vice President
+Executive Director of the Bank since February 2019 and Executive Vice President of the Bank
+since March 2018. Mr. LIN joined the Bank in 1987. He served as Deputy Chief Executive of
+BOC Hong Kong (Holdings) Limited from May 2015 to January 2018, as General Manager of
+the Corporate Banking Department of the Bank from March 2014 to May 2015, and as General
+Manager (Corporate Banking) of the Corporate Banking Unit of the Bank from October 2010
+to March 2014. Prior to this, he successively served as Deputy General Manager of Corporate
+Banking Department and Corporate Banking Unit of the Bank. Mr. LIN served as Chairman of
+BOC International Holdings Limited from April 2018 to December 2020. He has been serving as
+Chairman of BOC International (China) Co., Ltd. since May 2018, and Non-executive Director of
+BOC Hong Kong (Holdings) Limited since August 2018. He graduated from Xiamen University
+in 1987, and obtained a Master of Business Administration Degree from Xiamen University in
+2000.
+XIAO Lihong
+Non-executive Director
+Non-executive Director of the Bank since August 2017. Ms. XIAO was Non-executive Director
+of China Galaxy Asset Management Co., Ltd. from December 2020 to September 2021, Non-
+executive Director of China Galaxy Financial Holdings Company Limited from October 2018
+to September 2021 and Non-executive Director of China Galaxy Securities Company Limited
+from February 2019 to June 2021. She served as Inspector of the Current Account Management
+Department of the SAFE from April 2014 to August 2017. She was Deputy Director-General of
+the Current Account Management Department of the SAFE from September 2004 to April 2014,
+and concurrently as Vice General Manager and Party Committee Member of the Beijing Branch
+of China Construction Bank from July 2011 to July 2012. She served successively as Deputy
+Chief of the Current Account Division and the Nontrade Foreign Exchange Management Division
+of the Supervision and Inspection Department, and Chief of the Business Supervision Division
+of the Current Account Management Department of the SAFE from October 1996 to September
+2004. She graduated from the China Central University of Finance and Economics in August
+1988 with a Bachelor's Degree, and from the Central University of Finance and Economics and
+Peking University in September 2003 and July 2012, respectively, both with a Master's Degree.
+For the starting time of the term of office of the above-mentioned directors, supervisors and senior management
+members, please refer to the section "Basic Information".
+145
+The above persons' remuneration is calculated on the basis of their actual time working as directors, supervisors
+or senior management members of the Bank in 2021. Employee supervisors' remuneration above is paid for their
+service as supervisors of the Bank during the reporting period.
+In 2021, Non-executive Directors Mr. ZHAO Jie, Ms. XIAO Lihong, Ms. WANG Xiaoya, Mr. ZHANG Jiangang
+and Mr. CHEN Jianbo were not remunerated by the Bank.
+LIU Qiuwan
+Chief Information Officer
+81.53
+18.03
+2.00
+101.56
+No
+Notes:
+1.
+2.
+3.
+4.
+5.
+6.
+7.
+8.
+9.
+In accordance with the government regulations, since 1 January 2015, the Bank remunerates Chairman of the
+Board of Directors, President, Chairman of the Board of Supervisors and Executive Vice Presidents pursuant to
+the rules on remuneration reform for central enterprises.
+The 2021 final remuneration for Chairman of the Board of Directors, President, Chairman of the Board of
+Supervisors, executive directors and other senior management members is to be determined and will be disclosed
+in an additional announcement by the Bank.
+The Bank remunerates directors, supervisors and senior management members who are employed by the Bank
+with salaries, bonuses, and employer contribution to social insurance, enterprise annuity, supplementary medical
+insurance and housing provident fund, as well as other monetary income. Independent directors receive directors'
+remunerations and allowances. Other directors are not remunerated by the Bank. Chairman of the Board of
+Directors, executive directors and senior management members do not receive any remuneration from the Bank's
+subsidiaries.
+The remuneration for independent directors is determined based on the resolutions of the 2007 Annual General
+Meeting and the 2019 Second Extraordinary General Meeting. The remuneration for external supervisors is
+determined based on the resolutions of the 2009 Annual General Meeting.
+Some independent directors of the Bank served as independent non-executive directors of other legal entities or
+organisations, which caused such legal entities or organisations to be defined as connected parties of the Bank.
+Save as disclosed above, none of the directors, supervisors or senior management members of the Bank was
+remunerated by the connected parties of the Bank during the reporting period.
+Name
+WANG Xiaoya
+Non-executive Director of the Bank since August 2017. Ms. WANG has been serving as Non-
+executive Director of China Reinsurance (Group) Corporation since August 2019. She served
+as Non-executive Director of Industrial and Commercial Bank of China Limited from January
+2012 to June 2017. From May 2007 to December 2011, she was Deputy Director-General of the
+Research Bureau of the PBOC. She taught at the Central China Normal University where she
+served as Assistant Lecturer and Lecturer from July 1985 to January 1995. She served as Deputy
+Chief and Chief of the Macroeconomic Analysis Division of the Research Bureau of the PBOC
+from July 1997 to May 2007, and concurrently as Deputy Mayor of Tongliao City in the Inner
+Mongolia Autonomous Region from October 2005 to February 2007. She received a professional
+title of research fellow in 2005. Ms. WANG was a member of the Post-Doctoral Academic
+Committee and a Post-Doctoral Co-mentor at the Institute of Finance of PBOC. Currently, she
+is a member of the Academic Committee of the China Institute for Rural Studies of Tsinghua
+University, Invited Researcher of the National Institute of Financial Research of Tsinghua
+University and Doctoral Supervisor of Southwestern University of Finance and Economics. Ms.
+WANG graduated from the Economics Faculty of Central China Normal University and the
+Graduate School of Chinese Academy of Social Sciences in January 1990 and June 1997 with a
+Master's Degree and a Doctor's Degree, respectively.
+Executive Vice President
+Chief Information Officer
+From May 2019 to September 2021
+From June 2018 to October 2021
+Note:
+1.
+No former director, supervisor or senior management member held any share of the Bank during their terms of
+office.
+2.
+Please refer to the above table for the term of office of Mr. WANG Jiang as former Executive Director of the
+Bank. His term of office as former President of the Bank started from December 2019.
+141
+Remuneration of Directors, Supervisors and Senior Management
+Members Paid in 2021
+Remuneration before tax from the Bank in 2021
+(Unit: RMB ten thousand)
+Employer
+contribution to
+social insurance,
+enterprise
+annuity,
+supplementary
+medical
+insurance
+Remunerated by
+shareholding
+companies or
+Remuneration
+and housing Other monetary
+Male
+Non-executive Director
+149
+Independent Director
+ZHANG Jiangang
+Non-executive Director
+Non-executive Director of the Bank since July 2019. Mr. ZHANG served as member of the Party
+Committee, Secretary of Party Discipline Committee, Deputy Secretary-General, and Chairman
+of the Financial Evaluation Committee of the China Appraisal Society from May 2016 to July
+2019. From August 2014 to May 2016, Mr. ZHANG served as Deputy Secretary-General of the
+China Appraisal Society. From September 2000 to August 2014, he worked in the Department
+of Personnel and Education of the Ministry of Finance, successively serving as the Principal
+Staff Member, Deputy Director and Director. From November 1998 to September 2000, Mr.
+ZHANG served as a cadre of the editorial office of the State Assets Management of the Ministry
+of Finance. From July 1995 to November 1998, he served as a cadre of the former State-owned
+Assets Administration Bureau. Mr. ZHANG graduated from the China Youth University of
+Political Studies in July 1995 with a Bachelor's Degree in Law, and obtained a Master's Degree
+in Management from the Graduate School of the Chinese Academy of Fiscal Sciences of the
+Ministry of Finance in December 2002. He holds the title of Senior Economist.
+146
+CHEN Jianbo
+Non-executive Director
+Non-executive Director of the Bank since June 2020. Mr. CHEN served as Non-executive
+Director of Agricultural Bank of China Limited from January 2015 to June 2020. He previously
+served as Assistant Research Fellow and Deputy Division Chief, Institute of Development of
+the Rural Policy Research Office of the Secretariat of the CPC Central Committee and the Rural
+Development Research Center of the State Council; Division Chief and Research Fellow of the
+Development Research Center of the State Council; and Director-General of the General Office
+of the Central Leading Group for Financial and Economic Affairs and the Office of Central
+Rural Work Leading Group. He once led and participated in research and technical assistance
+projects sponsored by the World Bank, Asian Development Bank, European Union, United
+Nations Development Programme, United Nations Industrial Development Organization and
+other international institutions. He also hosted a number of research projects in cooperation with
+institutions in the U.S. and Japan, etc. He had multiple appointments as a consulting expert by the
+World Bank, Asian Development Bank and other institutions. Besides, he was a Visiting Scholar
+at Brandeis University, and a Visiting Research Fellow at Institute of Developing Economies in
+Japan and Asian Development Bank Institute. He received a PhD in Management from Renmin
+University of China in May 2005.
+WANG Changyun
+Independent Director
+Independent Director of the Bank since August 2016. Mr. WANG currently serves as professor
+and doctoral supervisor in finance at Renmin University of China ("RUC"). He served as a
+lecturer at RUC from 1989 to 1995 and as a lecturer at Business School, National University
+of Singapore from 1999 to 2005. He served successively as the Chair of Applied Finance
+Department of RUC, Director of China Financial Policy Research Center (a key research base
+of Ministry of Education) and Executive Vice Dean and Dean of Hanqing Advanced Institute
+of Economics and Finance at RUC from 2006 to 2016. Mr. WANG is currently also the Vice
+Chairman of China Investment Specialty Construction Association, Director of China Investment
+Association, Director of China Finance Association, Deputy Editor of Finance Research
+Quarterly, Deputy Editor of China Finance Research, and Deputy Editor of China Financial
+Review. He also serves as the Central Committee member of China Democratic League, the
+special auditor of State Auditing Administration, the independent non-executive director of
+Sunway Co., Ltd. (originally named as Sichuan Star Cable Co., Ltd.) and Beijing Haohua Energy
+Resource Co., Ltd. Mr. WANG has received social recognition and prizes including the Special
+Government Allowance of State Council, Best Paper Award of Chicago Board of Trade in
+2001, and the "Middle Age Experts with National Outstanding Contribution”, membership of
+"the Program for New Century Excellent Talents” of Ministry of Education in 2004, "Financial
+Support of National Science Fund for Distinguished Young Scholars" in 2007, a member of the
+"New Century National Hundred, Thousand and Ten Thousand Talent Program” in 2013, and
+the "Cheung Kong Distinguished Professor” of Ministry of Education in 2014. He obtained his
+Master's Degree in Economics from RUC in July 1989 and Doctorate in Financial Economics
+from the University of London in January 1999.
+147
+Angela CHAO
+Independent Director
+Independent Director of the Bank since January 2017. Ms. CHAO serves as Chair and CEO of
+Foremost Group, an international shipping company. From 1994 to 1996, Ms. CHAO worked in
+the mergers & acquisitions department of Smith Barney, which is now Morgan Stanley Smith
+Barney. From 1996 to 1999, Ms. CHAO served as deputy general manager of Foremost Group,
+and from 2001 to 2017, Ms. CHAO had successively served as Vice President, Senior Vice
+President and Deputy Chairman of Foremost Group. Since 2018, she has served as Chairman and
+CEO of Foremost Group. In May 2005, Ms. CHAO was unanimously voted to be BIMCO39's
+(The Baltic and International Maritime Council 39) Counsellor. In September 2005, she was
+selected as "Eminent Young Overseas Chinese" by the Overseas Chinese Affairs Office of
+the State Council of China. In November 2007, she was invited as speaker of World Shipping
+(China) Summit. In April 2011, she became a Founding Member of the Wall Street Journal's
+Task Force on Women in the Economy. Ms. CHAO currently serves on the Boards of The
+Metropolitan Opera, Foremost Foundation, Shanghai Mulan Education Foundation, and she also
+serves on the Harvard Business School's Board of Dean's Advisors, Carnegie-Tsinghua Center
+for Global Policy Board of Advisors, the Chairman's Council of the Metropolitan Museum of
+Art and American Bureau of Shipping Council. In addition, she is also a member of the Council
+on Foreign Relations, serves on the Young Leaders Forum of the National Committee on US-
+China Relations and serves as the member of Shanghai Jiao Tong University's Antai College
+of Economics and Management Advisory Board, and honorary chairperson of the Jiao Tong
+University Alumni Association in America. Ms. CHAO graduated from Harvard College in three
+years in 1994 with a Bachelor's Degree in Economics (Magna Cum Laude), and received her
+Master of Business Administration Degree from Harvard Business School in 2001.
+JIANG Guohua
+Independent Director
+Independent Director of the Bank since December 2018. Mr. JIANG serves as Professor of
+Accounting at the Guanghua School of Management, Peking University. Currently he also
+serves as a member of China National MPAcc Education Steering Committee and Associate
+Dean of Peking University Graduate School. Mr. JIANG has successively served as Assistant
+Professor, Associate Professor and Professor of the Accounting Department of Guanghua
+School of Management, Peking University since 2002, during which he successively served as
+Director of the Yenching Academy, Executive Associate Dean and Director of the Yenching
+Academy from 2013 to 2017. From 2007 to 2010, he was a senior investment consultant at
+Bosera Fund Management Company; from 2010 to 2016, he served as independent director of
+Datang International Power Generation Co. Ltd.; from 2011 to 2014, he was an academic advisor
+to the Global Valuation Institute of KPMG International; and from 2014 to 2015, he was a
+member of the Global Agenda Council of the World Economic Forum. Currently he also serves
+as independent director of ZRF Fund Management Company Ltd. and China Merchants Life
+Insurance Company Ltd. Mr. JIANG was named National Leading Talent in Accounting by China
+Ministry of Finance (2012). He was an Elsevier Chinese Most Cited Researcher consecutively
+from 2014 to 2017. He was a member of the 17th Stock Issuance Review Committee of China
+Securities Regulatory Commission. Mr. JIANG graduated from Peking University in 1995 with a
+Bachelor's Degree in Economics, received his Master's Degree in Accounting from Hong Kong
+University of Science and Technology in 1997, and obtained his Doctor's Degree in Accounting
+from the University of California, Berkeley in 2002.
+148
+Martin Cheung Kong LIAO
+Independent Director
+Independent Director of the Bank since September 2019. Mr. LIAO was called to the Bar in
+England and Wales in 1984 and was called to the Bar in Hong Kong in 1985 and is a practicing
+barrister in Hong Kong. He has been serving as a Member of the Legislative Council of the Hong
+Kong Special Administrative Region since 2012. Mr. LIAO has also been serving as a Steward
+of the Hong Kong Jockey Club since April 2013, an Independent Non-executive Director of
+Hang Lung Group Limited since November 2014, and Chairman of the Advisory Committee on
+Corruption of the Independent Commission Against Corruption since January 2019. Mr. LIAO
+was appointed as a Non-Official Member of the Executive Council of the Hong Kong Special
+Administrative Region in November 2016. He was appointed as Justice of the Peace in 2004,
+was awarded the Silver Bauhinia Star in 2014 and was awarded the Gold Bauhinia Star in 2019.
+He is elected as Deputy of the Hong Kong Special Administrative Region to the 11th, 12th and
+13th National People's Congress of the People's Republic of China. Mr. LIAO previously served
+as Chairman of the Anti-Money Laundering and Counter Terrorist Financing Review Tribunal
+and Chairman of The Hong Kong Council for Accreditation of Academic and Vocational
+Qualifications. He graduated from University College London with a Bachelor of Economic
+Science (Hons) Degree in 1982 and a Master of Laws Degree in 1985.
+CHEN Chunhua
+Independent Director of the Bank since July 2020. Ms. CHEN is currently professor of the
+National School of Development at Peking University and Dean of BIMBA Business School
+of the National School of Development at Peking University. She is also a visiting professor of
+the School of Business at National University of Singapore. From 2000 to 2003, she was Vice
+Dean of the College of Business Administration at South China University of Technology. From
+2003 to 2004, she served as President of Shandong Liuhe Group. From 2006 to 2008, she served
+as Executive Dean of the School of Economics and Commerce at South China University of
+Technology. From 2006 to 2016, she served as an expert on the decision-making consultation for
+the Guangzhou Municipal Government. Ms. CHEN has served as a non-executive director of SPT
+Energy Group Inc. (HK01251) (since 2013). She was an independent director of China Merchants
+Fund Management Co., Ltd., Welling Holding Limited, Guangzhou Zhujiang Brewery Co.,
+Ltd. and Shunde Rural Commercial Bank, and she once served as the joint chairman and chief
+executive officer of New Hope Liuhe Co., Ltd., a director of the Yunnan Baiyao Holding Ltd. and
+a non-executive director of Vtron Group Co., Ltd. Ms. CHEN obtained a Bachelor's Degree of
+engineering in radio technology from South China Institute of Technology in 1986 and became a
+post-doctoral candidate in business administration of the Nanjing University Business School in
+2005.
+Secretary to the Board
+8.16
+5.00
+152
+LIN Jingzhen
+Executive Director and Executive Vice President
+Please refer to the section "Directors"
+CHEN Huaiyu
+Executive Vice President
+Executive Vice President of the Bank since April 2021. Mr. CHEN joined the Bank in 1997.
+He served as General Manager of Bank of China Sydney Branch, Director of Bank of China
+(Australia) Limited, and Director of Bank of China (New Zealand) Limited from November 2017
+to February 2021. Prior to that, Mr. CHEN served as Assistant General Manager and Credit Risk
+Officer of Guangdong Branch of the Bank, Standing Deputy General Manager, General Manager
+and Executive Director of Bank of China (Hungary) Limited, as well as General Manager of Bank
+of China Hungarian Branch successively. He concurrently served as Chairman of BOC Aviation
+Limited since April 2021 and as President of Shanghai RMB Trading Unit since May 2021.
+Mr. CHEN graduated from Beijing Foreign Studies University in 1992 and obtained a Master's
+Degree in Economics from University of International Business and Economics in 1999.
+WANG Zhiheng
+Executive Vice President
+Executive Vice President of the Bank since August 2021. Mr. WANG joined the Bank in 1999.
+He served as General Manager of Beijing Branch of the Bank from May 2021 to January 2022,
+Employee Supervisor of the Bank from December 2018 to June 2021, General Manager of the
+Human Resources Department of the Head Office of the Bank from July 2018 to December 2020,
+and General Manager of Qinghai Branch of the Bank from July 2015 to September 2018. Prior to
+that, Mr. WANG served as Deputy General Manager of the Human Resources Department of the
+Head Office of the Bank and Deputy General Manager of Guangdong Branch of the Bank. Mr.
+WANG graduated and obtained a Master's Degree in Finance from Nankai University in 1999.
+LIU Jiandong
+Chief Risk Officer
+Chief Risk Officer since February 2019. Mr. LIU joined the Bank in 1991. From March 2014
+to February 2019, he served as General Manager of the Credit Management Department of the
+Bank. Mr. LIU served as General Manager (Investment Banking) of the Corporate Banking
+Unit of the Bank from February 2011 to March 2014. Mr. LIU previously served as Deputy
+General Manager of the Corporate Banking Department and Corporate Banking Unit of the Bank.
+He graduated from Renmin University of China in 1991, and obtained a Master's Degree in
+Economics from Renmin University of China in 2000.
+153
+ZHUO Chengwen
+Chief Audit Officer
+Chief Audit Officer of the Bank since May 2021. Mr. ZHUO joined the Bank in 1995. He served
+as Chief Risk Officer of BOC Hong Kong (Holdings) Limited from November 2019 to February
+2021, Mr. ZHUO served as Chief Executive and Executive Director of BOCG Insurance from
+June 2016 to November 2019, and as General Manager of the Financial Management Department
+of the Bank from December 2014 to June 2016. Prior to that, Mr. ZHUO served as Deputy
+General Manager of New York Branch, Deputy General Manager of the Financial Management
+Department of the Bank, and Chief Financial Officer of BOC Hong Kong (Holdings) Limited.
+He concurrently served as General Manager of the Audit Department of the Bank since January
+2022. Mr. ZHUO graduated from Peking University with a Master's Degree in Economics in
+1995, and obtained a Master's Degree in Business Administration from the City University of
+New York in 2005. He has the qualification of Certified Public Accountant.
+MEI Feiqi
+159
+According to the Articles of Association, any shareholder who holds, individually or in
+aggregate, 3% or more voting shares of the Bank shall have the right to propose a resolution in
+a shareholders' meeting. Any shareholder who holds, individually or in aggregate, 3% or more
+voting shares of the Bank shall have the right to propose and submit in writing to the Board of
+Directors interim proposals 10 days prior to the convening of a shareholders' meeting. When the
+Board of Directors decides not to include such proposals on the meeting agenda, it shall explain
+and clarify the reasons at the shareholders' meeting. When the proposing shareholders dissent
+with the Board of Directors' decision to exclude such proposals, they may request to call for
+an extraordinary shareholders' meeting by themselves based on the procedures stipulated in the
+Articles of Association.
+Shareholders' Right to Propose Resolutions at Shareholders' Meetings
+According to the Articles of Association, shareholders individually or in aggregate holding a total
+of 10% or more voting shares of the Bank have the right to make a written request to the Board of
+Directors to convene an extraordinary shareholders' meeting. Two or more shareholders holding a
+total of 10% or more voting shares of the Bank may sign one or more written requests of identical
+form and substance requesting the Board of Directors to convene a meeting of shareholders
+of different categories and stating the subject of the meeting. If the Board of Directors fails to
+issue a notice of such a meeting within 30 days after receipt of a written request for convening
+an extraordinary shareholders' meeting or a meeting of shareholders of different categories
+submitted by the proposing shareholders, the proposing shareholders may by themselves convene
+the meeting within four months after the Board of Directors receives the request. The procedures
+according to which they convene such meeting shall, to the extent possible, be identical to the
+procedures according to which shareholders' meetings are convened by the Board of Directors.
+Where the proposing shareholders convene and hold a meeting because the Board of Directors
+fails to convene such meeting pursuant to a request as mentioned above, the reasonable expenses
+incurred by such shareholders shall be borne by the Bank and shall be deducted from the sums
+owed by the Bank to the negligent directors.
+Shareholders' Right to Convene an Extraordinary Shareholders' Meeting
+and a Meeting of Shareholders of Different Categories
+The Bank highly values the protection of its shareholders' interests and has established and
+maintained an effective and multi-channel shareholder communication platform. This includes
+holding shareholders' meetings and maintaining an investor hotline to ensure that all shareholders
+are treated equally, properly informed and able to participate in and exercise their voting and
+other rights regarding the major issues of the Bank. The Bank is independent and completely
+autonomous in all of its business operations. It operates independently and separately from its
+controlling shareholder, Huijin, in respect of its business, personnel, asset, institutional and
+financial matters.
+Shareholders and Shareholders' Rights
+158
+No amendment was made to the Articles of Association in 2021.
+Amendments to the Articles of Association
+During the reporting period, the Bank strictly observed the Corporate Governance Code (the
+"Code") as set out in Appendix 14 to the Hong Kong Listing Rules. Save as disclosed in this
+annual report, during the reporting period, the Bank has complied with all the provisions of the
+Code and has substantially complied with most of the recommended best practices set out in the
+Code.
+Please refer to the section "Directors"
+During the reporting period, the actual performance of the Bank's corporate governance was fully
+in compliance with laws, administrative regulations, and the requirements for the governance of
+listed companies of CSRC.
+Executive Director and Executive Vice President
+Please refer to the section "Directors"
+Secretary to the Board of Directors and Company Secretary
+CHUI Sai Peng Jose
+Independent Director
+Independent Director of the Bank since September 2020. Mr. CHUI is currently the President of
+CAA City Planning & Engineering Consultants Ltd. of Macao, and Da Chang (Zhuhai) Concrete
+Pile Co., Ltd., CEO of Parafuturo de Macau Investment and Development Ltd., and Chairman
+of Board of Directors of Macao Young Entrepreneur Incubation Centre. He is also the Deputy
+of the Macao SAR to the 13th National People's Congress, Deputy of Legislative Assembly of
+the Macao SAR, and member of the Economic Development Committee of the Macao SAR. In
+addition, he serves as a member of the National Committee of China Association for Science
+and Technology, Vice-President of Board of Directors of Macao Chamber of Commerce,
+Vice-President of General Assembly of the Macao Association of Building Contractors and
+Developers, President of Association of Macao Engineering Consultant Companies. Mr.
+CHUI served as the President of Hou Kong Junior Chamber in 1994 and President of Junior
+Chamber International Macao, China in 1999. He was the President of Committee for Building
+Appraisal of the Macao SAR from 2002 to 2015. He served as member and Vice-President of
+the Committee of Cultural Industries of the Macao SAR from 2010 to 2016. Currently he serves
+as Non-Executive Director of Luso International Banking Ltd. and Board Member of Macao
+Science Center. Mr. CHUI is a registered Urban Planner and Civil Engineer of Macao. He is also
+a registered Civil Engineer and Structural Engineer (Senior Engineer Level) of California, USA.
+Mr. CHUI received his Bachelor's Degree in Civil Engineering from University of Washington
+in 1981, and received his Master's Degree in Civil Engineering from University of California,
+Berkeley in 1983. He graduated from Tsinghua University in 2002 with a Doctor's Degree in
+Urban Planning.
+Supervisors
+ZHANG Keqiu
+Chairwoman of the Board of Supervisors
+Chairwoman of the Board of Supervisors of the Bank since January 2021. Ms. ZHANG
+previously served in several positions at Agricultural Bank of China for many years. She served
+as Executive Director and Executive Vice President of Agricultural Bank of China from April
+2019 to November 2020. She served as Executive Vice President of Agricultural Bank of China
+from July 2017. From June 2015 to April 2018, she served as Secretary to the Board of Directors
+of Agricultural Bank of China. Before that, she successively served as General Manager of the
+Asset and Liability Management Department, General Manager of the Financial Accounting
+Department and Chief Financial Officer of Agricultural Bank of China. She graduated from
+Nankai University in 1988 with a Master's Degree in Economics. In addition, she holds the title
+of Senior Accountant.
+150
+WEI Hanguang
+Employee Supervisor
+Employee Supervisor of the Bank since November 2021. Ms. WEI currently serves as General
+Manager of the Human Resources Department of the Head Office of the Bank. Ms. WEI is also
+a director of BOC International Holdings Limited, Bank of China Group Investment Limited and
+BOC Aviation Limited. She joined the Bank in July 1994, and used to serve as Deputy General
+Manager of the Human Resources Department of the Head Office, Executive Deputy Director
+of Office of the Leading Group for Comprehensively Deepening Reform and Deputy General
+Manager of the Human Resources Department of the Head Office of the Bank, and General
+Manager of the Human Resources Department of the Head Office of the Bank. She graduated
+from Tsinghua University and obtained a Master's Degree in Business Administration.
+ZHOU Hehua
+Employee Supervisor
+Employee Supervisor of the Bank since November 2021. Mr. ZHOU currently serves as General
+Manager of the Credit Approval Department of the Head Office of the Bank. He joined the Bank
+in August 1997, and used to serve as Assistant to General Manager of Shanghai Branch, Deputy
+General Manager of Shanghai Branch, and Deputy General Manager of Fujian Branch and
+General Manager of Xiamen Branch of the Bank. He graduated from China Europe International
+Business School and obtained a Master's Degree in Business Administration.
+LENG Jie
+Employee Supervisor
+Employee Supervisor of the Bank since December 2018. Mr. LENG currently serves as General
+Manager of Hebei Branch of the Bank. Mr. LENG started working in November 1981 and joined
+the Bank in September 1988, serving successively as Deputy General Manager of Shandong
+Branch, Deputy General Manager of Shanxi Branch, General Manager of Ningxia Branch and
+General Manager of Chongqing Branch of the Bank. Mr. LENG graduated from Shandong
+Institute of Light Industry (economics administration major) in 1999 and University of Jinan in
+2009 (accounting major).
+JIA Xiangsen
+External Supervisor
+External Supervisor of the Bank since May 2019. Mr. JIA had successively worked in the PBOC
+and Agricultural Bank of China (“ABC”). From December 1983 to April 2008, Mr. JIA served as
+Deputy Director of the PBOC Fengtai District Office, and held such positions at ABC as Deputy
+Head of Beijing Fengtai Sub-branch, Deputy Division Chief at Beijing Branch, Head of Beijing
+Dongcheng Sub-branch, Deputy General Manager of Beijing Branch, General Manager of the
+Corporate Banking Department of the ABC Head Office, and General Manager of Guangdong
+Branch. From April 2008 to March 2010, Mr. JIA served as Principal of Audit Office of ABC.
+From March 2010 to March 2014, he was concurrently Chief Auditor and Principal of the Audit
+Office of ABC. Mr. JIA currently serves as Independent Director of China Life Pension Company
+Limited. Mr. JIA received his Master's Degree in Monetary Banking from the Chinese Academy
+of Social Sciences. He holds the title of Senior Economist.
+151
+ZHENG Zhiguang
+External Supervisor
+External Supervisor of the Bank since May 2019. Mr. ZHENG had successively worked in the
+PBOC and Industrial and Commercial Bank of China Limited (“ICBC”). From March 1979
+to August 2004, Mr. ZHENG served as Deputy Section Chief of the PBOC Shanghai Luwan
+District Office, and held such positions at ICBC as Deputy Division Chief of Shanghai Luwan
+Office, Division Chief at Shanghai Branch, and Deputy General Manager of Shanghai Branch.
+From September 2004 to August 2009, he served as Head of Shanghai Sub-bureau of ICBC
+Internal Audit Bureau. From September 2009 to January 2013, he served as General Manager of
+the Precious Metal Business Department of ICBC. From 2013 to 2014, he served as Director of
+ICBC International Holdings Limited and Chairman of the Board of Supervisors of ICBC-AXA
+Assurance Co., Ltd. Mr. ZHENG received his MBA Degree from Fudan University. He holds the
+title of Senior Economist.
+HUI Ping
+External Supervisor
+External Supervisor of the Bank since February 2022. Mr. Hui had successively worked for the
+PBOC and the Industrial and Commercial Bank of China (“ICBC”). Mr. Hui joined and worked
+for Qingjian County sub-branch of PBOC Shaanxi Branch in December 1980, joined and worked
+for Qingjian sub-branch of ICBC Shaanxi Branch in August 1986. From May 1994 to December
+2010, he held various positions at ICBC Shaanxi Branch, including, among others, secretary at
+deputy director level of the office, deputy director of the office and director of the office, the head
+of Shaanxi Xianyang Branch, deputy general manager of Shaanxi Branch, and general manager
+of Shaanxi Branch of ICBC. From December 2010 to June 2015, Mr. Hui served as general
+manager of the internal control and compliance department of the ICBC Head Office. From June
+2015 to April 2019, Mr. Hui served as deputy secretary of party discipline committee, director of
+the discipline enforcement department of the ICBC Head Office. From April 2019 to July 2020,
+Mr. Hui served as deputy head of the discipline inspection and supervision group dispatched to
+ICBC by the CPC Central Commission for Disciplinary Inspection and the State Committee of
+Supervisory. From September 2015 to September 2020, Mr. Hui concurrently served as employee
+supervisor of ICBC. He graduated from Xiamen University with a Doctor's Degree in Finance.
+He holds the title of Senior Economist.
+Senior Management Members
+LIU JIN
+Vice Chairman and President
+WANG Wei
+Corporate Governance Compliance
+Secretary to the Board of Directors since April 2018. Mr. MEI joined the Bank in 1998. He
+has previously served as Deputy General Manager of the Beijing Branch of the Bank, General
+Manager (Wealth Management and Personal Banking) of the Personal Banking Unit of the Bank,
+Spokesman of the Bank and General Manager of the Executive Office of the Bank's Head Office.
+Prior to joining the Bank, he worked at the Ministry of Geology and Mineral Resources and the
+General Office of the State Council. He graduated from Chengdu University of Technology with
+a Bachelor's Degree, and later received on-the-job postgraduate education. He holds the title of
+Senior Economist.
+Laundering Committee
+Asset Disposal Committee
+The Bank takes excellent corporate governance as an important objective. It has constantly
+pursued the best practice in corporate governance and integrated the Party's leadership with
+improvement of corporate governance. Adhering to the rules and regulations governing capital
+markets and relevant industries, the Bank has made constant efforts to improve its corporate
+governance framework, which comprises the shareholders' meeting, the Board of Directors, the
+Board of Supervisors and the Senior Management. This framework operates smoothly owing
+to a clear division of duties. All special committees of the Board of Directors and the Board of
+Supervisors have performed their duties and functioned effectively, thereby enhancing the Bank's
+corporate governance capabilities.
+Overview of Corporate Governance
+Corporate Governance
+156
+The Board of Directors of the Bank considered and approved the proposal regarding the
+appointment of Ms. MENG Qian as Chief Information Officer of the Bank. Such appointment is
+subject to the approval by regulatory authorities.
+The Board of Directors of the Bank considered and approved the proposal regarding the
+appointment of Ms. ZHAO Rong as Chief Business and Management Officer of the Bank. Such
+appointment is subject to the approval by regulatory authorities.
+Mr. LIU Qiuwan ceased to serve as Chief Information Officer of the Bank as of 25 October 2021
+due to the reason of age.
+Mr. ZHENG Guoyu ceased to serve as Executive Vice President of the Bank as of 24 September
+2021 due to a change of job.
+Mr. WANG Zhiheng began to serve as Executive Vice President of the Bank as of 17 August
+2021.
+Mr. ZHUO Chengwen began to serve as Chief Audit Officer of the Bank as of 18 May 2021.
+Mr. LIU Jin began to serve as President of the Bank as of 26 April 2021.
+Mr. CHEN Huaiyu began to serve as Executive Vice President of the Bank as of 19 April 2021.
+Mr. WANG Jiang ceased to serve as President of the Bank as of 5 February 2021 due to a change
+of job.
+Changes in the Bank's senior management members were as follows:
+Mr. HUI Ping began to serve as External Supervisor of the Bank as of 17 February 2022 and
+began to serve as member of the Duty Performance and Due Diligence Supervision Committee of
+the Board of Supervisors and member of the Finance and Internal Control Supervision Committee
+of the Board of Supervisors as of 7 March 2022.
+Mr. ZHOU Hehua began to serve as Employee Supervisor of the Bank as of 18 November
+2021 and began to serve as member of the Duty Performance and Due Diligence Supervision
+Committee of the Board of Supervisors and member of the Finance and Internal Control
+Supervision Committee of the Board of Supervisors as of 3 December 2021.
+Credit Risk Management and
+Decision-making Committee
+154
+Ms. WEI Hanguang began to serve as Employee Supervisor of the Bank as of 18 November
+2021 and began to serve as member of the Duty Performance and Due Diligence Supervision
+Committee of the Board of Supervisors as of 3 December 2021.
+Mr. LI Changlin ceased to serve as Employee Supervisor, member of the Duty Performance and
+Due Diligence Supervision Committee of the Board of Supervisors and member of the Finance
+and Internal Control Supervision Committee of the Board of Supervisors of the Bank as of 18
+November 2021 due to the expiration of his term of office.
+Mr. WANG Zhiheng ceased to serve as Employee Supervisor, member of the Duty Performance
+and Due Diligence Supervision Committee of the Board of Supervisors and member of the
+Finance and Internal Control Supervision Committee of the Board of Supervisors of the Bank as
+of 24 June 2021 due to the reason of work.
+Ms. ZHANG Keqiu began to serve as Chairwoman of the Board of Supervisors, Shareholder
+Representative Supervisor and Chairwoman of the Duty Performance and Due Diligence
+Supervision Committee of the Board of Supervisors of the Bank as of 18 January 2021.
+Mr. WANG Xiquan ceased to serve as Chairman of the Board of Supervisors, Shareholder
+Representative Supervisor and Chairman of the Duty Performance and Due Diligence Supervision
+Committee of the Board of Supervisors of the Bank as of 18 January 2021 due to reason of age.
+Changes in the Bank's supervisors were as follows:
+Mr. ZHAO Jie ceased to serve as Non-executive Director, member of the Audit Committee,
+member of the Risk Policy Committee and member of the Personnel and Remuneration
+Committee of the Board of Directors of the Bank as of 15 March 2022 due to a change of job.
+Mr. LIU Jin began to serve as Vice Chairman, Executive Director and member of the Strategic
+Development Committee of the Board of Directors of the Bank as of 16 June 2021.
+Mr. WANG Jiang ceased to serve as Vice Chairman, Executive Director and member of the
+Strategic Development Committee of the Board of Directors of the Bank as of 5 February 2021
+due to a change of job.
+Changes in the Bank's directors were as follows:
+Changes in Directors, Supervisors and Senior Management Members
+The Bank has been working on improving its corporate governance structure, policies and
+procedures. It persistently followed up and implemented regulatory requirements on capital
+market, always choosing to adhere to the strictest available standards. It re-examined and self-
+inspected its corporate governance policies, and comprehensively and systematically reviewed the
+Articles of Associations and the rules of procedure of each special committee.
+The Bank places great emphasis on improving its corporate governance operation mechanisms.
+It ensures that minority shareholders are properly informed and able to participate and make
+decisions. The annual shareholders' meeting is held on-site, and online voting for A-Share
+Holders is available to safeguard the rights and interests of the minority shareholders. The
+Bank focuses on constantly enhancing coordination with respect to the operation mechanisms
+of the Board of Directors, information disclosure and stakeholder engagement. It continues to
+support the Board of Directors to function more constructively and make scientific and efficient
+decisions. The Bank works to heighten transparency and proactively perform its duties to the
+relevant stakeholders, including shareholders, customers, staff and society.
+155
+In 2021, according to the Announcement on Carrying out Special Campaigns on Governance of
+Listed Companies (CSRC Announcement [2020] No. 69) and the Notice of Special Self-inspection
+on Governance of Listed Companies (CSRC Beijing Office [2020] No. 628), the Bank carried out
+special self-inspection on corporate governance and has not found any problems that need to be
+rectified in accordance with the foregoing regulations.
+Anti-Money
+Internal Control Supervision Committee
+Financial and
+Due Diligence Supervision Committee
+Duty Performance and
+Financial Digitalisation Committee
+Overseas Work
+Coordination Committee
+Green Finance Committee
+Domestic Branch Development and
+Coordination Committee
+Consumer Protection Committee
+Business Committee
+The Bank makes great efforts to promote Board diversity. It has formulated the Bank of China
+Limited Board Diversity Policy, which lays out the stance of the Bank on the diversity of
+the members of the Board of Directors and the approaches it adopts to realise such diversity
+on an on-going basis. All appointments are made on merit, in the context of the skills and
+experience the Board of Directors as a whole requires, and taking into full consideration and
+from various perspectives the object and requirements for diversity, including but not limited
+to regulatory requirements, gender, age, cultural and educational background, geographical
+location, professional experience, skills, knowledge, and length of service of directors, etc. The
+Bank applies the aforementioned diversity policy and requirements to the director selection and
+engagement process.
+Senior Management
+(Executive Committee)
+Audit Department
+Management Committee
+Asset and Liability
+Management Committee
+Risk Management and
+Internal Control Committee
+Centralised Procurement
+Management Committee
+Securities Investment and
+Management Committee
+Innovation and Product
+Management Committee
+Integrated Operation
+Coordination Committee
+Asset Management
+US Risk and
+In 2021, the Bank's corporate governance performance continued to be recognised by the capital
+markets and the public. It won a number of awards including "Best Company for Investor
+Relations", "Best Board of Directors for Investor Relations" and "Best Secretary to the Board for
+Investor Relations" of the 12th Pegasus Award of China's Listed Companies Investor Relations.
+157
+Corporate Governance Framework
+Board Secretariat
+Board of Directors
+Shareholders'
+Meeting
+Board of Supervisors
+Board of Supervisors Office
+Committee
+Corporate Culture and
+Consumer Protection Committee
+Audit Committee
+Risk Policy Committee
+Strategic Development
+Personnel and
+Remuneration Committee
+Connected Transactions
+Control Committee
+8/8
+0/0
+5/7
+4/4
+2/2
+13/14
+13/14
+Notes:
+8/8
+2/2
+14/14
+8/8
+4/4
+2/2
+14/14
+14/14
+ZHANG Jiangang
+CHEN Jianbo
+8/8
+WANG Jiang
+8/8
+2/2
+2/2
+2/2
+ន ន ន ន ន ន ន ន ន ន ន ន ន
+Former Directors
+CHUI Sai Peng Jose
+14/14
+CHEN Chunhua
+Martin Cheung Kong LIAO
+JIANG Guohua
+Angela CHAO
+WANG Changyun
+ZHAO Jie
+8/8
+। । । । | |➢ |➢S➢ཇཱ ༔S
+14/14
+ཙཾ | | | |ཟུ་ཟུ|༑ཟུ་ཚཝ
+6/7
+-
+6/7
+2/7
+6/7
+7/7
+7/7
+1/1
+XIAO Lihong
+WANG Xiaoya
+0/1
+2/2
+14/14
+7/7
+山-
+1/8
+1001
+8/8
+0/3
+6/8
+0/1
+8/8
+III ∞ ∞ ∞ ∞ ∞
+8/8
+8/8
+4/4
+13/14
+7/8
+1/2
+12/14
+2/2
+13/14
+7/8
+4/4
+2/2
+13/14
+7/8
+2/2
+12/14
+7/8
+3/4
+2/2
+12/14
+3/4
+8/8
+2/2
+LIN Jingzhen
+The Board of Directors attached great importance to the Group's far-reaching internal control
+system and continued to promote its development. It regularly heard and reviewed Senior
+Management reports concerning the implementation of the Guidelines on Internal Control
+of Commercial Banks, bank-wide operational management, risk management, fraud case
+management and internal control system development and assessment, thus earnestly assuming its
+responsibility to improve and deliver a sound and effective internal control function.
+LIU Jin
+Other countries
+and regions
+13
+Executive
+12
+Director
+Hong Kong.
+Macao and Taiwan
+Over 60
+Female
+14
+f China
+Over!
+10
+9
+Non-executive
+8
+Director
+55-60
+7
+6
+11
+Number of Directors
+Board Composition
+For detailed background and an explanation of recent changes to the Board membership, please
+refer to the section "Directors, Supervisors and Senior Management Members”.
+Shareholders' Right to Present Enquiries
+According to the Articles of Association, any shareholder who holds severally or jointly with
+others 5% or more voting shares of the Bank shall have the right to present enquiries to the
+shareholders' meeting. The Board of Directors, the Board of Supervisors, or other relevant senior
+management members shall attend the shareholders' meeting, accept enquiries, and answer or
+explain accordingly.
+Please refer to the Articles of Association for details of the rights pertaining to shareholders. If
+shareholders need to contact the Board of Directors regarding the aforementioned items or for
+other enquiries to the Board of Directors, please refer to the section "Reference for Shareholders
+Investor Enquiry" for contact details.
+Shareholders' Meeting
+Functions and Powers of Shareholders' Meeting
+The shareholders' meeting is the body of authority of the Bank. The shareholders' meeting is
+responsible for making decisions on the important issues of the Bank, including considering and
+approving the Bank's profit distribution plan, annual financial budget and financial statements,
+changes in the Bank's registered capital, adopting resolutions on matters such as the issuance
+of bonds and other securities, merger and division, amending the Articles of Association of
+the Bank, electing directors, electing shareholders' representative supervisors and external
+supervisors and deciding the remunerations of directors and supervisors.
+Convening of Shareholders' Meeting during the Reporting Period
+On 18 January 2021, the Bank held its 2021 First Extraordinary General Meeting on-site
+in Beijing on 18 January 2021. A-Share Holders could also cast votes online. The meeting
+considered and approved proposals, including the election of Ms. ZHANG Keqiu to be appointed
+as Shareholder Representative Supervisor of the Bank, the 2019 remuneration distribution plan
+for Chairman of the Board of Directors and Executive Directors, and the 2019 remuneration
+distribution plan for Chairman of the Board of Supervisors and Shareholder Representative
+Supervisors. All the proposals were ordinary resolutions.
+On 20 May 2021, the Bank held its 2020 Annual General Meeting on-site in Beijing. A-Share
+Holders could also cast votes online. The meeting considered and approved 15 proposals,
+including the 2020 work report of the Board of Directors, the 2020 work report of the Board of
+Supervisors, the 2020 annual financial report, the 2020 profit distribution plan, the 2021 annual
+budget for fixed assets investment, the appointment of the Bank's external auditor for 2021, the
+2020 annual remuneration distribution plan for External Supervisors, the election of Mr. LIU
+Liange to be re-appointed as Executive Director of the Bank, the election of Mr. LIU Jin to be
+appointed as Executive Director of the Bank, the election of Mr. LIN Jingzhen to be re-appointed
+as Executive Director of the Bank, the election of Mr. JIANG Guohua to be re-appointed as
+Independent Non-executive Director of the Bank, the application for provisional authorisation of
+outbound donations, the bond issuance plan, the issuance of write-down undated capital bonds
+and the issuance of qualified write-down tier 2 capital instruments. The meeting also heard
+the report on the connected transactions for 2020, the duty report of independent directors for
+2020, and the report on the implementation of the Scheme on the Authorisation to the Board
+of Directors Granted by the Shareholders' Meeting of Bank of China Limited for 2020. The
+160
+proposals regarding the bond issuance plan, the issuance of write-down undated capital bonds and
+the issuance of qualified write-down tier 2 capital instruments were special resolutions, while the
+rest of the proposals were ordinary resolutions.
+The aforementioned meetings were convened and held in strict compliance with the relevant laws
+and regulations as well as the listing rules of the Chinese mainland and Hong Kong. The Bank's
+directors, supervisors and senior management members attended the meetings and communicated
+with shareholders on issues of their concern.
+The Bank issued announcements on the resolutions and legal opinions of the aforementioned
+shareholders' meeting on 18 January 2021 and 20 May 2021 respectively, pursuant to regulatory
+requirements. Please refer to the websites of SSE, HKEX and the Bank.
+Implementation of the Resolutions Passed at the Shareholders' Meeting by
+the Board of Directors
+During the reporting period, the Board of Directors has fully implemented the resolutions passed
+at the shareholders' meeting and the scheme on the authorisation to the Board of Directors
+granted by the shareholders' meeting, and earnestly carried out the proposals regarding the 2020
+profit distribution plan, the 2021 annual budget for fixed assets investment, the bond issuance
+plan, the appointments of directors and 2021 external auditor, and so on.
+Board of Directors
+Functions and Powers of the Board of Directors
+The Board of Directors, which is responsible to the shareholders' meeting, is the Bank's decision-
+making body. The Board of Directors exercises the following functions and powers as specified
+by the Bank's Articles of Association: convening shareholders' meetings and implementing
+the resolutions of shareholders' meetings; deciding on the Bank's strategic policies, business
+plans and material investment plans (except for those material investment plans that are subject
+to shareholders' meeting approval as specified in the Articles of Association); formulating the
+annual financial budgets, final accounts and plans for profit distribution and loss recovery of
+the Bank; appointing or dismissing members of special committees and the Senior Management
+of the Bank; reviewing and deciding on the establishment of the Bank's basic administrative
+system, internal management framework and important sub-entities; developing and reviewing
+the corporate governance policies of the Bank; taking charge of performance evaluation and
+matters of material reward and punishment for senior management members, and hearing the
+reports of the Senior Management and examining their work, among others. The Board of
+Directors continuously reviews and updates the Articles of Association and the Bank's corporate
+governance policies and systems in accordance with the applicable laws and regulations, relevant
+regulatory requirements and listing rules, and ensures compliance with such policies and systems.
+Composition of the Board of Directors
+The Board of Directors has set up the Strategic Development Committee, Corporate Culture
+and Consumer Protection Committee, Audit Committee, Risk Policy Committee, Personnel and
+Remuneration Committee and Connected Transactions Control Committee, as well as the US
+Risk and Management Committee established under the Risk Policy Committee, to assist the
+Board of Directors in performing its functions under the authorisation of the Board of Directors.
+161
+The Board of Directors of the Bank is rationally structured and diversified. Currently, the Board
+of Directors comprises fourteen members. Besides the Chairman, there are three executive
+directors, four non-executive directors and six independent directors. The proportion of
+independent directors reaches one-third of the total number of directors. The Bank's directors
+are elected at the shareholders' meeting, with a term of office of three years starting from
+the date when the Bank receives approval of the appointment from CBIRC. A director may
+serve consecutive terms by re-election and re-appointment unless otherwise specified by laws,
+regulations, supervisory requirements and the Articles of Association of the Bank. The positions
+of Chairman and President of the Bank are assumed by two persons.
+5
+Chinese
+mainland
+4
+163
+Duty Performance of Directors
+Directors' Attendance of Shareholders' Meetings, Meetings of the Board of Directors
+and Special Committees
+During the reporting period, the attendance rate of each director of the shareholders' meetings,
+meetings of the Board of Directors and special committees is given below.
+Number of meetings attended in person/Number of meetings convened during term of office
+Meetings of the Special Committees of the Board of Directors
+Corporate
+Culture and
+Connected
+Shareholders' the Board
+Directors
+Meetings
+of Directors
+Meetings of Strategic
+Development
+Committee
+Consumer
+Protection
+Committee
+Audit
+Committee
+Risk Policy Remuneration
+Personnel and Transactions
+Control
+Committee Committee Committee
+Incumbent Directors
+LIU Liange
+2/2
+3/4
+During the reporting period, the Bank performed self-assessment on internal control in line with
+the Basic Standard for Enterprise Internal Control and its supporting guidelines. No material
+deficiencies were identified in the internal control systems for both the financial reporting and
+non-financial reporting of the Bank. PricewaterhouseCoopers Zhong Tian LLP, as the Bank's
+external auditor for internal control, audited the effectiveness of the Bank's internal controls
+over financial reporting and issued a standard unqualified opinion. The 2021 Internal Control
+Assessment Report of Bank of China Limited and the 2021 Auditor's Report on Internal Control
+issued by PricewaterhouseCoopers Zhong Tian LLP have been published on the websites of SSE,
+HKEX and the Bank.
+WANG Wei
+The Audit Committee under the Board of Directors closely monitored the changing economic
+and financial environment at home and abroad, as well as the overall conditions of the Group's
+internal control function, including the establishment and operation of its internal control systems
+for both financial reporting and non-financial reporting. In addition, the committee heard and
+reviewed, on a regular and ad hoc basis, internal audit reports and assessment opinions on internal
+control, reports on the progress of internal control improvements and remediation suggested by
+external auditors, as well as the overall situation regarding the prevention, control and redress of
+fraud cases and risk events.
+The Board of Directors and its Risk Policy Committee have acknowledged the full effectiveness
+of the existing risk management system of the Bank based on their close monitoring and quarterly
+evaluation of the system's effectiveness.
+Male
+Under 3
+Independent
+3
+Director
+2
+Under 55
+1
+0
+Designation Nationality
+Age
+Gender
+Directorship
+with the Bank
+(years)
+Convening of Board Meetings
+In 2021, the Bank convened ten on-site meetings of the Board of Directors and reviewed and
+approved 84 proposals on 28 January, 16 March, 30 March, 29 April, 2 July, 30 August, 28
+September, 29 October, 13 December and 27 December respectively. The proposals covered
+matters such as the Bank's regular reports, the nomination of candidates for directorships, the
+appointment of senior management members, the issuance of bonds, and profit distribution, etc. It
+also heard 20 reports related to the anti-money laundering work, strategy implementation, country
+risk management, green finance development and other matters.
+In 2021, the Bank convened four meetings of the Board of Directors via written resolutions. At
+these meetings, the Board of Directors mainly reviewed and approved the proposals regarding
+donation to disaster relief in Henan Province, among others.
+162
+Risk Management and Internal Control by the Board of Directors and its
+Special Committees
+The Board of Directors of the Bank considers a sound risk management system to be the basic
+prerequisite of realising the Bank's strategic goals. By continuously improving the independence,
+specialisation, foresight, and initiative of its risk management function, the Bank ensures the
+sound and sustainable development of its banking businesses and creates greater value for
+shareholders.
+According to regulatory rules and internal management requirements, the Senior Management
+submits important risk management policies, rules and procedures to the Board of Directors and
+Risk Policy Committee for review and approval. The Risk Policy Committee regularly reviews
+the Group's overall risk status (covering major risk categories such as credit risk, market risk,
+operational risk, liquidity risk, legal and compliance risk and reputational risk) and upcoming
+work plan and puts forward corresponding work requirements.
+2/3
+8/8
+There are currently six independent directors on the Board of Directors. This reaches one-
+third of the total number of directors and is thus in compliance with the quorum requirement
+specified in the Articles of Association and relevant regulatory requirements. For the professional
+backgrounds and other details of the independent directors, please refer to the section "Directors,
+Supervisors and Senior Management Members". Independent directors individually serve as
+the Chairman of the Corporate Culture and Consumer Protection Committee, Audit Committee,
+Risk Policy Committee, Personnel and Remuneration Committee and Connected Transactions
+Control Committee. As stipulated in the relevant domestic regulatory requirements and Rule 3.13
+of the Hong Kong Listing Rules, the Bank has received the annual confirmation in writing from
+each independent director with regard to their independence. Based on these confirmations and
+relevant information in possession of the Board of Directors, the Bank confirms their independent
+8/8
+The committee is mainly responsible for reviewing the strategic development plans presented by
+the Senior Management, assessing the factors that may affect the strategies of the Bank and their
+implementation, and advising the Board with regard to strategy adjustments; reviewing the annual
+budget, strategic capital allocation, the objectives of asset-liability management, IT development
+and other special strategic development plans of the Bank, and advising the Board accordingly;
+coordinating strategies on the overall development of various financial businesses and the
+development of domestic and overseas institutions, and deciding on the setup, cancellation
+and increase or decrease of capital of the Bank's domestic and overseas institutions within
+its scope of authorisation; designing and formulating key investment and financing plans and
+merger and acquisition plans of the Bank; and reviewing the substantial internal reorganisation
+and adjustment plans of the Bank, and advising the Board accordingly; reviewing the Bank's
+The Strategic Development Committee comprises ten members, including Chairman Mr. LIU
+Liange, Vice Chairman and President Mr. LIU Jin, Non-executive Directors Ms. XIAO Lihong,
+Ms. WANG Xiaoya, Mr. ZHANG Jiangang and Mr. CHEN Jianbo and Independent Directors
+Mr. WANG Changyun, Mr. JIANG Guohua, Mr. Martin Cheung Kong LIAO and Ms. CHEN
+Chunhua. Chairman Mr. LIU Liange serves as the Chairman of the committee.
+Strategic Development Committee
+Special Committees of the Board of Directors
+The directors acknowledge that they are responsible for preparing financial statements of the
+Bank that truly represent the operating results of the Bank for each financial year. To the best
+knowledge of the directors, there was no material event or condition during the reporting period
+that might have a material adverse effect on the continuing operation of the Bank.
+The following statement, which sets out the responsibilities of the directors regarding financial
+statements, should be read in conjunction with, but understood separately from, the auditor's
+statement of their responsibilities as set out in the Independent Auditor's Report contained in this
+annual report.
+Responsibility Statement of Directors on Financial Reports
+The guarantee business is one of the Bank's ordinary business activities approved by PBOC and
+CBIRC. The Bank has formulated specific management measures, operational processes and
+approval procedures in light of the risks of the guarantee business and carried out this business
+accordingly. The Bank's guarantee business principally comprises letters of guarantee. As at
+31 December 2021, the outstanding amount of letters of guarantee issued by the Bank was
+RMB1,086.152 billion.
+Pursuant to the relevant provisions and requirements of CSRC and SSE, and according to the
+principles of justice, fairness and objectivity, the Independent Directors of the Bank, Mr. WANG
+Changyun, Ms. Angela CHAO, Mr. JIANG Guohua, Mr. Martin Cheung Kong LIAO, Ms. CHEN
+Chunhua and Mr. CHUI Sai Peng Jose have provided the following information regarding the
+Bank's guarantee business:
+Specific Explanation and Independent Opinions of Independent Directors on the
+Guarantee Business of the Bank
+165
+In 2021, independent directors held no objection to proposals of the meetings of the Board of
+Directors and special committees.
+In 2021, independent directors put forward constructive recommendations on the Bank's 14th
+Five-Year Plan, corporate culture building, comprehensive risk management, globalised and
+integrated operations, green finance and FinTech, among others. These recommendations were
+adopted and diligently implemented by the Bank.
+In 2021, the Bank's independent directors attended meetings of the Board of Directors, reviewed
+proposals, participated in discussions and offered their professional opinions independently,
+objectively and diligently, in accordance with the Articles of Association, the Procedural Rules
+for Board of Directors of Bank of China Limited and the Work Rules of Independent Directors of
+Bank of China Limited. Please refer to the section “Directors' Attendance of the Shareholders'
+Meeting, Meetings of the Board of Directors and Special Committees" for the attendance of
+independent directors at meetings.
+status.
+166
+Independence and Duty Performance of Independent Directors
+green credit strategy and making relevant suggestions to the Board; establishing the Bank's
+strategic development plan and basic management regimes with regard to inclusive finance
+business, reviewing the annual business plan and assessment measures of the inclusive finance
+business, and supervising the Bank's implementation of inclusive finance strategies, policies and
+regulations.
+In addition, in response to changes in international and domestic economic and financial
+situations, the Strategic Development Committee stepped up its analysis of the prevailing
+opportunities and challenges, and put forward many important comments and recommendations
+regarding the Bank's efforts to implement its Development Plan, accelerating the pace of
+transformation, and improving the quality and efficiency in serving the real economy, thus
+providing strong support to the scientific decision-making of the Board of Directors.
+169
+In accordance with the Policies of Selection, Rotation and Dismissal for External Auditors of
+Bank of China Limited, the external auditor for 2021 made a summary report and submitted a
+report on their compliance with the principle of independence to the committee.
+The Audit Committee heard and reviewed reports from the Senior Management concerning
+the Bank's business performance and primary financial data. It also requested that the Senior
+Management submit the annual financial statements to the auditors in a timely manner, so
+as to ensure sufficient time for the annual audit. During the audit, the committee maintained
+independent communications with the auditors and arranged independent communications
+between the auditors and the independent directors. At its second meeting of 2022, the Audit
+Committee reviewed and approved the Bank's 2021 financial statements and submitted them to
+the Board of Directors for approval.
+According to the Procedure Rules on the Preparation of Annual Report of the Board Audit
+Committee of Bank of China Limited, prior to the start of audit field work by the auditors, the
+Audit Committee confirmed with the auditors the details of the 2021 audit plan, including areas
+of focus for auditing the 2021 Annual Report, risk assessment and identification methods, the
+application of accounting standards, tests of internal control, compliance and fraud related
+procedures, and the allocation of human resources. In particular, the committee reminded the
+auditors to report any difference of judgement between the auditors and the Senior Management
+during the audit, as well as the process and results of reconciling such differences.
+3/3
+168
+In 2021, the Audit Committee held six on-site meetings on 27 January, 16 March, 26 March, 28
+April, 27 August and 28 October, respectively, and one meeting via written resolutions. It mainly
+reviewed and approved the 2021 priorities, project plan and financial budget for internal audit,
+and reviewed the Bank's 2020 financial report, 2021 interim financial report and financial reports
+for the first and third quarters of 2021, the internal control work report for 2020 and the first
+half of 2021, the 2020 internal control assessment report, and the audit results on internal control
+and management proposal. In addition, it heard the report on the Senior Management response
+to Ernst & Young's management proposal for 2020, reports on internal audit in 2020 and the
+first half of 2021, the special report on IT application in audit, the 2020 report on the overseas
+supervision information, the report on the progress of the internal control audit of Ernst & Young
+in 2020, updates on compliance with the principle of independence, the audit plan for 2021
+of PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers, the report on asset
+quality in the first quarter of 2021, and the report on the prevention and control of external cases
+in 2020.
+The committee is mainly responsible for reviewing financial reports and other significant
+accounting policies and regulations formulated by the Senior Management; reviewing the
+external auditors' audit opinion on financial reporting, annual audit plan and recommendations
+for management; approving the annual internal audit plan and budget; appraising the duty
+performance, work quality and effectiveness of the external auditors and internal audit and
+monitoring their independence; recommending the engagement, reappointment, replacement
+and audit fee of the external auditors; recommending the appointment and dismissal and
+appraising the performance of the Chief Audit Officer; overseeing the Bank's internal control
+function, reviewing material deficiencies in internal control design and execution by the Senior
+Management and investigating fraud cases; reviewing the employee reporting system and urging
+the Bank to conduct fair investigations and take appropriate measures regarding matters reported
+by the employees.
+The Audit Committee comprises six members, including Non-executive Director Mr. ZHANG
+Jiangang and Independent Directors Mr. WANG Changyun, Ms. Angela CHAO, Mr. JIANG
+Guohua, Mr. Martin Cheung Kong LIAO and Mr. CHUI Sai Peng Jose. Independent Director Mr.
+JIANG Guohua serves as the Chairman of the committee.
+Audit Committee
+In 2021, the Corporate Culture and Consumer Protection Committee held four on-site meetings
+on 30 March, 30 August, 29 October and 30 December respectively, at which it reviewed and
+approved the 2020 Corporate Social Responsibility Report of Bank of China and the 2020 Work
+Report and 2021 Work Plan for Consumer Protection and the Consumer Protection Policy of
+Bank of China Limited. In addition, it heard the Report on Consumer Complaints in the First
+Quarter of 2021 and the Corporate Culture Building Plan of Bank of China Limited, etc.
+167
+The committee is mainly responsible for reviewing and advising the Board of Directors on
+the Bank's corporate culture development plans and policies, etc., and supervising their
+implementation, urging the Senior Management to examine and assess the implementation
+of the Bank's values, and pushing forward the refinement and elaboration, promotion and
+popularisation, education and training, and implementation of the Bank's value concepts system;
+urging the management to build a corporate culture work evaluation system, and overseeing and
+assessing the development and implementation of the Bank's corporate culture; reviewing the
+employee code of conduct and urging the management to put in place a matching implementation
+mechanism; reviewing and advising the Board of Directors on the Bank's consumer protection
+strategies, policies and objectives, etc., and overseeing and evaluating the Bank's consumer
+protection work; reviewing and advising the Board of Directors on the Bank's environmental,
+social and governance (ESG) development plans, policies and reports; identifying, assessing and
+managing important ESG-related matters and building an appropriate and effective ESG risk
+management and internal control system; regularly hearing the reports on the Bank's corporate
+culture building, ESG and consumer protection work; and other duties delegated by the Board of
+Directors.
+The Corporate Culture and Consumer Protection Committee comprises six members, including
+Chairman Mr. LIU Liange, Non-executive Directors Ms. WANG Xiaoya and Mr. CHEN Jianbo,
+and Independent Directors Mr. JIANG Guohua, Ms. CHEN Chunhua and Mr. CHUI Sai Peng
+Jose. Independent Director Ms. CHEN Chunhua serves as the Chairwoman of the committee.
+Corporate Culture and Consumer Protection Committee
+In 2021, the Strategic Development Committee held six on-site meetings on 28 January, 30
+March, 29 April, 30 August, 29 October and 13 December, respectively, and two meetings via
+written resolutions. At these meetings, it mainly reviewed the proposals on Outline of 14th Five-
+Year Development Plan (2021-2025) and Long-Range Objectives through the Year 2035 for Bank
+of China, Green Financial Plan, Plan for Data Strategy, Inclusive Finance Plan, Fintech Plan,
+Capital Management Plan, the business plan and financial budget of Bank of China for 2021, the
+profit distribution plan of Bank of China for 2020, the issuance of write-down undated capital
+bonds, the issuance of qualified write-down tier 2 capital instruments, the dividend distribution
+plan of offshore preference shares, the bond issuance plan, and an application for a special
+external donation limit for targeted support.
+In 2021, the Board of Directors paid significant attention to enhancing directors' expertise, with
+a special focus on arranging relevant training. All directors of the Bank fully observed Rule
+A.6.5 of the Code as well as PRC regulatory requirements, actively participating in specialised
+training including sessions on artificial intelligence enabling future business, the current state
+of international financial market development and the opportunities and challenges facing the
+global development of commercial banks, anti-money laundering policy interpretation and
+sanction violation case analysis, green finance and the digital economy. The Bank's directors also
+took it upon themselves to enhance their professional skills in various ways, including writing
+and publishing professional articles, attending forums and seminars, meeting with domestic
+and overseas regulators, and conducting on-site research exercises at the Bank's domestic and
+overseas branches as well as at other advanced banks.
+Moreover, in response to changes in domestic and overseas economic and financial trends, the
+Audit Committee paid close attention to developments in the Bank's progress towards improving
+business performance and cost control. The committee heard the Group risk report and the
+report on asset quality, among others, thus assisting the Board of Directors in performing its
+responsibilities and duties. It also put forward many important opinions and suggestions regarding
+the improvement of the corporate governance mechanism, the enhancement of internal audit
+independence, the advancement of IT application in audit, the upgrading of credit asset quality
+and the improvement of internal control measures.
+Mr. LIU Jin, Mr. WANG Wei, Mr. ZHANG Jiangang, Mr. WANG Changyun, Ms. Angela CHAO, Mr. JIANG
+Guohua, Mr. Martin Cheung Kong LIAO, Ms. CHEN Chunhua and Mr. CHUI Sai Peng Jose, all of whom were
+unable to attend the Meetings of the Board of Directors and Meetings of the Special Committees of the Board of
+Directors in person, had appointed other Directors to attend and exercise their voting rights on their behalf.
+8/8
+3/3
+18
+8/8
+8/8
+3/3
+1.
+2.
+During the reporting period, three directors have abstained from voting or voted against related proposals.
+Director ZHANG Jiangang proposed that a few clauses of Management Measures for Financial Services in
+Response to Emergencies should be further refined according to the requirements of the regulatory measures.
+Director XIAO Lihong proposed that regarding the Internal Capital Adequacy Assessment Report, there was room
+for improvement in the comprehensive risk management capability and policy due to the rather weak foundation.
+Director ZHAO Jie proposed that a project plan should be further refined according to the business environment.
+164
+Training and Expertise Enhancement of Directors
+30%
+Nil
+179
+The Board of Supervisors has set up the Duty Performance and Due Diligence Supervision
+Committee and the Finance and Internal Control Supervision Committee to assist in performing
+its authorised duties.
+173
+187,405
+The Board of Supervisors is the Bank's supervisory organ and is responsible to the shareholders'
+meeting. As stipulated in the Company Law and the Articles of Association of the Bank, the
+Board of Supervisors is responsible for overseeing the work of the Board of Directors so as to
+ensure the establishment of a prudent operational principle, value criterion and an appropriate
+development strategy. It supervises the duty performance and due diligence of the Board of
+Directors, the Senior Management and its members as well as the Bank's financial activities, risk
+management and internal control.
+Composition of the Board of Supervisors
+56,228
+57,994
+2019
+Nil
+30%
+192,870
+Functions and Powers of the Board of Supervisors
+0.197
+2020
+Nil
+0.191
+Board of Supervisors
+In 2021, the Personnel and Remuneration Committee held six on-site meetings on 16 March, 26
+March, 28 April, 2 July, 27 August and 28 October, respectively, and two meetings by written
+resolutions. At these meetings, the committee mainly reviewed the performance evaluation results
+and remuneration distribution plan for the Chairman, Executive Directors and senior management
+members for 2020, the 2021 implementation plan for performance evaluation of the Chairman,
+President and other senior management members, the nomination of Mr. LIU Liange and Mr. LIN
+Jingzhen to be re-appointed as Executive Directors of the Bank and Mr. JIANG Guohua to be
+re-appointed as Independent Non-executive Directors of the Bank, the appointment of Mr. LIU
+Jin as President of the Bank, the nomination of Mr. LIU Jin as candidate for Executive Director
+of the Bank and the appointment of Mr. LIU Jin as member of the Strategic Development
+Committee of the Board of Directors of the Bank, the appointment of Mr. CHEN Huaiyu as
+Executive Vice President of the Bank, the appointment of Mr. WANG Zhiheng as Executive Vice
+President of the Bank, the appointment of Mr. ZHUO Chengwen as Chief Audit Officer of the
+Bank, and the nomination of Mr. E Weinan as candidate for Independent Non-executive Director
+of the Bank, the nomination of Mr. Giovanni TRIA as candidate for Independent Non-executive
+Director of the Bank, the nomination of Mr. Jean-Louis EKRA as candidate for Independent Non-
+executive Director of the Bank and the nomination of Mr. HUANG Binghua as candidate for
+Non-executive Director of the Bank.
+The committee is mainly responsible for administering the connected transactions of the Bank in
+accordance with relevant laws, regulations and supervisory rules, and formulating administrative
+regulations with regard to connected transactions; confirming the Bank's connected parties
+according to laws, regulations and normative documents, and reporting the relevant confirmation
+to the Board of Directors and the Board of Supervisors; defining the connected transactions of the
+Bank in accordance with laws, regulations and normative documents; examining the connected
+transactions of the Bank pursuant to relevant laws, regulations and normative documents, as well
+as the business principles of justice and fairness; and examining information disclosure matters
+related to significant connected transactions of the Bank.
+The Board of Supervisors currently comprises seven members. There is one shareholder
+supervisor (the Chairwoman of the Board of Supervisors), three employee supervisors and
+three external supervisors. According to the Articles of Association, a supervisor has a term of
+office of three years and may serve consecutive terms by re-election and re-appointment unless
+otherwise specified by laws, regulations, supervisory requirements and the Articles of Association
+of the Bank. Shareholder supervisors and external supervisors are elected or replaced by the
+shareholders' meeting, while employee supervisors are elected or replaced by the Employee
+Delegates' Meeting.
+Risk Policy Committee
+The Risk Policy Committee of the Bank comprises five members, including Executive Director
+Mr. LIN Jingzhen, Non-executive Directors Ms. XIAO Lihong and Mr. CHEN Jianbo,
+Independent Directors Mr. WANG Changyun and Ms. Angela CHAO. Independent Director Mr.
+WANG Changyun serves as the Chairman of the committee, and Non-executive Director Ms.
+XIAO Lihong serves as the Vice Chairwoman of the committee.
+The committee is mainly responsible for performing functions and exercising powers in relation
+to comprehensive risk management; reviewing the Bank's risk management strategies, substantial
+risk management policies, and risk management procedures and regimes, and advising the Board
+accordingly; discussing the risk management procedures and regimes with the management and
+making suggestions on how to improve them in order to ensure that the risk management policies,
+procedures and regimes are uniformly adhered to throughout the Bank; reviewing the Group's
+risk data aggregation and risk reporting framework and ensuring that there is adequate resource
+support in place; examining the material risk activities of the Bank and judiciously exercising
+veto power regarding commitments that expose the Bank to credit and/or market risk exceeding
+the individual risk limits approved by the Risk Policy Committee or the Board of Directors or
+that lead to breaches of approved aggregate limits; supervising the implementation status of the
+Bank's risk management strategy, policy and procedure, and advising the Board accordingly;
+examining the Bank's risk management status and reviewing its risk management procedures
+and regimes; regularly evaluating and hearing reports on the implementation of risk management
+and internal control responsibilities by the Bank's management, functional departments and
+institutions, as well as risk data aggregation and risk reporting work, and proposing requirements
+for improvement; supervising the status of the Bank's compliance with laws and regulations;
+reviewing and examining relevant basic management policies related to legal compliance
+and making suggestions which are submitted to the Board for examination and approval, and
+hearing and examining the report on the implementation status of the legal compliance policy
+of the Bank; assessing the material investigation results of risk management matters and the
+management's response to such results (either voluntarily or as required by the Board of
+Directors); reviewing and approving the Bank's general policy on case prevention and control,
+and defining the management's functions, powers and authorities in relation to case prevention
+and control; setting out overall requirements on case prevention and control, and reviewing
+related working reports; checking and effectively supervising the Bank's case prevention and
+control work, assessing the effectiveness of case prevention and control, and promoting the
+building of its case prevention and control management system.
+170
+In addition, the committee paid close attention to critical risk issues arising from changes
+in overseas and domestic economic and financial conditions, as well as adjustments to the
+government's macro policies and overall overseas and domestic regulations. The committee
+expressed important opinions and recommendations regarding the improvement of the Bank's risk
+governance mechanism and the effective prevention and control of all kinds of risks.
+The US Risk and Management Committee is established under the Risk Policy Committee. It
+oversees and manages all the risks incurred by the Bank's institutions in the US, and performs the
+duties of the board of directors of the Bank's New York Branch and its special committees.
+The US Risk and Management Committee currently comprises three members, all of whom are
+members of the Risk Policy Committee, including Non-executive Director Ms. XIAO Lihong,
+Independent Directors Mr. WANG Changyun and Ms. Angela CHAO. Independent Director Ms.
+Angela CHAO serves as the Chairwoman of the US Risk and Management Committee.
+In 2021, the Connected Transactions Control Committee held three on-site meetings on 26
+March, 27 August and 28 October, respectively. It mainly reviewed the report on connected
+transactions in 2020, the report on the CBIRC's Rules on Connected Transactions of Banking
+and Insurance Institutions (exposure draft), and the report on the impact of the Personal
+Information Protection Law on the Bank's connected transactions management, among others. It
+also approved the report on the connected party list, among others. During the reporting period,
+the Connected Transactions Control Committee paid constant attention to the transmission of the
+Bank's policies and system development for connected transactions, and put forward constructive
+suggestions in that regard.
+In 2021, the US Risk and Management Committee convened eight meetings via written
+resolutions. It regularly reviewed reports regarding the risk management and operations of all of
+the Bank's institutions in the US, the latest US regulatory trends and dynamics, among others. In
+addition, the committee reviewed and approved the relevant framework documents and important
+policies of all the institutions of the Bank in the US according to regulatory requirements.
+The Personnel and Remuneration Committee comprises six members, including Non-executive
+Director Ms. WANG Xiaoya, Independent Directors Mr. WANG Changyun, Mr. JIANG Guohua,
+Mr. Martin Cheung Kong LIAO, Ms. CHEN Chunhua and Mr. CHUI Sai Peng Jose. Independent
+Director Mr. CHUI Sai Peng Jose serves as the Chairman of the committee.
+The committee is mainly responsible for assisting the Board of Directors in reviewing the
+Bank's human resources and remuneration strategies and overseeing their implementation;
+reviewing the structure, size and composition of the Board of Directors on an annual basis,
+and making suggestions to the Board regarding the scale and composition of the Board of
+Directors; studying and reviewing the standards and procedures for selecting, nominating and
+appointing directors, members of the Board committees and Senior Management, and making
+relevant recommendations to the Board of Directors; identifying individuals suitably qualified
+to become directors and making recommendations to the Board of Directors on the selection
+of individuals nominated for directorships; performing preliminary review of the candidates
+for Senior Management positions and the chairmanship of Board committees, selecting and
+nominating candidates for different Board committees, and reporting to the Board of Directors
+for approval; reviewing, supervising the implementation of and monitoring the remuneration and
+incentive policies of the Bank; drafting the remuneration distribution plan of directors and senior
+management members, and making recommendations to the Board of Directors; and formulating
+the performance appraisal standards for senior management members of the Bank, and evaluating
+their performances.
+171
+30%
+According to the Articles of Association of the Bank, any shareholder who holds by himself
+or jointly with others 3% or more of the total number of voting shares of the Bank may,
+by submitting a written proposal to the shareholders' meeting, recommend candidates for
+directorships, provided the number of candidates nominated shall be in accordance with the
+provisions of the Articles of Association (between 5 and 17) and not exceed the number to be
+elected. List of candidates for directorships may be recommended by the Board of Directors
+within the number of candidates stipulated in the Articles of Association, with reference to
+the diversity policy of the Bank and according to the number to be elected. The Personnel
+and Remuneration Committee shall undertake a preliminary review of the qualifications and
+conditions of candidates for directorships, and refer those qualified candidates to the Board of
+Directors for further examination. After the Board of Directors' approval by resolutions, the
+candidates shall be referred to the shareholders' meeting in written proposals. When directorships
+need to be added or filled temporarily, the Board of Directors shall raise the proposal and make
+recommendation to the shareholders' meeting to elect or replace. During the reporting period, the
+Bank appointed directors in strict compliance with the Articles of Association.
+172
+Connected Transactions Control Committee
+The Connected Transactions Control Committee comprises five members, including Executive
+Director Mr. WANG Wei, Independent Directors Ms. Angela CHAO, Mr. JIANG Guohua, Mr.
+Martin Cheung Kong LIAO and Mr. CHUI Sai Peng Jose. Independent Director Mr. Martin
+Cheung Kong LIAO serves as the Chairman of the committee.
+Personnel and Remuneration Committee
+216,559
+In 2021, the Risk Policy Committee held seven on-site meetings on 27 January, 29 March, 28
+April, 29 June, 26 August, 28 September and 27 October, respectively, and one meeting via
+written resolutions. The Committee mainly considered the comprehensive risk management
+policy, Group risk appetites statement, trading book market risk limits, liquidity risk management
+policy, polices for interest rate risk in the banking book, data governance policy, case prevention
+management policy, management measures for reputation risk, capital adequacy ratio report,
+internal capital adequacy assessment report and anti-money laundering work report. The
+committee also regularly reviewed the Group risk reports and other agendas.
+0.221
+Report of the Board of Directors
+177
+In 2021, the Bank continued to enhance its work in investor relations and information disclosure,
+receiving wide market recognition. It won a number of awards including “Best Investor
+Relations", "Best Board of Directors for Investor Relations" and "Best Secretary to the Board for
+Investor Relations" of the 12th Pegasus Award of China's Listed Companies Investor Relations
+from Securities Times. The Bank's annual report won a “Gold Award in the Overall Category
+of the Annual Report Competition" of the League of American Communications Professionals
+(LACP). It also won "Honors in Chairman's/President's letter" of the Annual Report Competition
+(ARC).
+176
+In 2021, the Bank prepared and disclosed its regular and provisional reports in strict adherence
+to the principles of truthfulness, accuracy, completeness, conciseness and clarity. It continuously
+enhanced transparency and optimised its information disclosure, focusing on the demands of
+investors. It continuously enhanced the pertinence and effectiveness of information disclosure
+in order to guarantee investors' access to relevant information. Through concise and clear
+language, investors are provided with equal opportunity to access accurate information. The
+Bank has established a comprehensive and complete information disclosure system and put in
+place clear specifications regarding information disclosure standard and the scope of application,
+responsibility and division of work of the parties concerned, as well as information handling
+and disclosure procedures and internal monitoring measures. During the reporting period, in
+accordance with the regulatory provisions and based on the Bank's information disclosure
+practices, it has reviewed and revised its Bank of China Limited Information Disclosure Policy.
+It carefully organised compliance analysis and disclosure of material events, as well as actively
+exploring and steadily promoting voluntary information disclosure. The Bank reinforced the
+principal responsibility system and information correspondent mechanism, and promoted the
+building of a professional team and a strong compliance culture of information disclosure, so
+as to improve the initiative and long-term perspective of its information disclosure management
+work. It also carried out the registration and submission of insider information according to
+relevant regulatory requirements and the rules of the Bank.
+In 2021, the Bank kept tracked of market dynamics in a timely manner, actively conducted
+market communication, and continued to build a professional and efficient investor relations
+management practice. It held its annual and interim results briefing via live-streaming platform
+and proactively held two quarterly results presentations online, reaching a wide range of domestic
+and overseas investors of various types and bringing significant efforts and results in investor
+communication. The Bank conducted in-depth communication with institutional investors,
+completing over 170 communication activities of various forms. This included attending
+seminars held by investment banking institutions, holding online non-deal roadshow and thematic
+meetings, and conducting daily communication etc., while making meeting records for reference.
+The Bank also attached high importance to minority investor services. It professionally answered
+investor hotline and email inquiries, promptly responded to inquires from “e-interaction online
+platform" run by SSE, continued to organise the open day for investors via the roadshow platform
+run by SSE, and actively participated in the special event of the 3rd “5.15 National Investor
+Protection Promotion Day” organised by the Listed Companies Association of Beijing. The
+Bank's external ratings remained unchanged with a stable prospect.
+Investor Relations and Information Disclosure
+PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers have provided audit
+services to the Bank for one year. Ms. Ho Shuk Ching Margarita, Mr. Zhu Yu, Mr. Li Dan are the
+certified public accountants who signed the auditor's report on the Bank's financial statements
+prepared in accordance with CAS for the year ended 31 December 2021.
+175
+Fees paid to PricewaterhouseCoopers and its member firms for financial statements audit of
+the Group, including those of the Bank's overseas subsidiaries and branches, were RMB173
+million for the year ended 31 December 2021, of which the fees for internal control audit paid to
+PricewaterhouseCoopers Zhong Tian LLP totalled RMB12 million. The Bank paid RMB 12.5781
+million for non-auditing services to PricewaterhouseCoopers and its member firms in the year.
+Upon approval by the 2020 Annual General Meeting, PricewaterhouseCoopers Zhong Tian
+LLP was appointed as the Bank's domestic auditor and internal control auditor for 2021, and
+PricewaterhouseCoopers was appointed as the Bank's international auditor for 2021.
+The Board of Directors is pleased to present its report together with the audited Consolidated
+Financial Statements of the Bank and its subsidiaries (the "Group") for the year ended 31
+December 2021.
+Appointment of External Auditors
+During the reporting period, the former Procurement Review Committee under the Senior
+Management (Executive Committee) was renamed Centralised Procurement Management
+Committee, which is responsible for the decision-making management of centralised procurement
+activities. The Senior Management presided over the Asset and Liability Management
+Committee, the Risk Management and Internal Control Committee (which governs the Anti-
+money Laundering Committee, the Asset Disposal Committee and the Credit Risk Management
+and Decision-making Committee), the Centralised Procurement Management Committee, the
+Securities Investment and Management Committee, the Innovation and Product Management
+Committee, the Integrated Operation Coordination Committee, the Asset Management Business
+Committee, the Consumer Protection Committee, the Domestic Branch Development and
+Coordination Committee, the Green Finance Committee, the Overseas Work Coordination
+Committee and the Financial Digitalisation Committee. During the reporting period, all of the
+committees diligently fulfilled their duties and responsibilities as per the powers specified in their
+committee charters and the rights delegated by the Executive Committee, and pushed forward the
+sound development of the Bank's various operations.
+During the reporting period, the Senior Management of the Bank held 24 regular meetings,
+at which it focused on key operational areas and discussed and decided upon a series of
+significant matters, including the Group's business development, performance management,
+risk management, audit supervision, IT development, product and service innovation, integrated
+operation, globalised development, inclusive finance and scenario building. It also held special
+meetings to study and make plans for the Group's corporate banking, personal banking, financial
+markets, channel building, smart operations, compliance management and data governance.
+174
+During the reporting period, the Senior Management of the Bank managed the Bank's operations
+in accordance with the powers bestowed upon it by the Articles of Association and the
+authorisations of the Board of Directors. Closely adhering to the strategic goal of "Building a
+First-class Global Banking Group” and to the annual performance objectives approved by the
+Board of Directors, the Senior Management emphasised on invigorating, adapting to change and
+driving for major breakthroughs. It accelerated the implementation of various tasks within the
+Bank's development strategy, and ensured steady improvement in the Group's operating results.
+Duty Performance of the Senior Management
+The Senior Management is the executive organ of the Bank. It is headed by the President,
+with executive vice presidents and other senior management members assisting the President's
+work. The main functions and powers of the President include presiding over the Bank's daily
+administrative, business and financial management; organising the implementation of the
+business plan and investment schemes; drafting basic management regulations and specific
+rules; nominating candidates for other senior management positions; and reviewing employees'
+remuneration, benefit, reward and punishment measures.
+Functions and Powers of the Senior Management
+Senior Management
+In 2021, the Board of Supervisors and its special committees earnestly performed their
+supervisory responsibilities and reviewed relevant proposals through detailed discussion. The
+Board of Supervisors held four on-site meetings and three meetings by written resolution, and
+made relevant resolutions. The Duty Performance and Due Diligence Supervision Committee held
+four on-site meetings and three meetings by written resolution, while the Finance and Internal
+Control Supervision Committee held four on-site meetings and one meeting by written resolution.
+For the performance of and supervisory opinions from the Board of Supervisors during the
+reporting period, please refer to the section "Report of the Board of Supervisors".
+Duty Performance of the Board of Supervisors
+65,060
+Pursuant to domestic and overseas securities regulatory requirements, the Bank formulated and
+implemented the Management Measures on Securities Transactions by Directors, Supervisors
+and Senior Management Personnel of Bank of China Limited (the "Management Rules") to
+govern securities transactions by directors, supervisors and senior management members of the
+Bank. The terms of the Management Rules are more stringent than the mandatory standards set
+out in the Model Code for Securities Transactions by Directors of Listed Issuers contained in
+Appendix 10 to the Hong Kong Listing Rules (the "Model Code”). All directors and supervisors
+confirmed that they had complied with the standards set out in both the Management Rules and
+the Model Code throughout the reporting period.
+Principal Activities
+Securities Transactions by Directors and Supervisors
+Major Customers
+2021
+The Bank provides a range of banking and related financial services, including commercial
+banking, investment banking, direct investment, securities, insurance, fund management, aircraft
+leasing, asset management, financial technology business and financial leasing.
+Capitalisation
+of the capital
+reserve
+of the Bank
+(Unit:
+RMB million)
+RMB million)
+(Unit: RMB)
+Payout ratio to share capital
+(before tax)
+(Unit:
+(before tax)
+Year of dividend
+attributable to
+equity holders
+Total dividend
+distribution
+At the Bank's 2020 Annual General Meeting held on 20 May 2021, a final dividend on ordinary
+shares for 2020 of RMB1.97 per 10 shares (before tax) was approved for payment. The A-Share
+and H-Share dividends were distributed to the shareholders in June 2021 in accordance with
+relevant regulations. The distribution plan has been accomplished and the actual distributed
+amount for ordinary shares was approximately RMB57.994 billion (before tax). No interim
+dividend on ordinary shares was paid for the period ended on 30 June 2021 by the Bank. The
+Bank did not propose any capitalisation of the capital reserve to share capital in 2021.
+Profit
+Cash Dividend Payout for Ordinary Shares and Capitalisation of the
+Capital Reserve to Share Capital for the Past Three Years
+At the Board meeting held on 29 October 2021, the dividend distribution plan for the Bank's
+Offshore Preference Shares (Second Tranche) was approved. The Bank distributed dividends on
+the Offshore Preference Shares (Second Tranche) on 4 March 2022. According to the Bank's
+issuance terms of the Offshore Preference Shares (Second Tranche), dividends on Offshore
+Preference Shares (Second Tranche) were paid in US dollars, with a total of approximately
+USD101.5 million (after tax) at an annual dividend rate of 3.60% (after tax). The dividend
+distribution plan has been accomplished.
+At the Board meeting held on 29 April 2021, the dividend distribution plans for the Bank's
+Domestic Preference Shares (Third and Fourth Tranche) were approved. The Bank distributed a
+total of RMB3.285 billion (before tax) of dividends on the Domestic Preference Shares (Third
+Tranche) on 28 June 2021, with an annual dividend rate of 4.50% (before tax). The Bank
+distributed a total of RMB1.1745 billion (before tax) of dividends on the Domestic Preference
+Shares (Fourth Tranche) on 30 August 2021, with an annual dividend rate of 4.35% (before tax).
+The dividend distribution plans have been accomplished.
+At the Board meeting held on 30 October 2020, the dividend distribution plan for the Bank's
+Offshore Preference Shares (Second Tranche) was approved. The Bank distributed dividends on
+the Offshore Preference Shares (Second Tranche) on 4 March 2021. According to the Bank's
+issuance terms of the Offshore Preference Shares (Second Tranche), dividends on Offshore
+Preference Shares (Second Tranche) were paid in US dollars, with a total of approximately
+USD102 million (after tax) at an annual dividend rate of 3.60% (after tax). The dividend
+distribution plan has been accomplished.
+178
+On 30 August 2020, the dividend distribution plan for the Bank's Domestic Preference Shares
+(Second Tranche) was approved by the Board. The Bank distributed a total of RMB1.540 billion
+(before tax) of dividends on the Domestic Preference Shares (Second Tranche) on 15 March
+2021, with an annual dividend rate of 5.50% (before tax). The dividend distribution plan has been
+accomplished.
+During the year, the five largest customers of the Group accounted for less than 30% of the
+interest income and other operating income of the Group.
+The Bank's annual results for 2021 are set out in the Consolidated Financial Statements. The
+Board of Directors has recommended a final dividend on ordinary shares for 2021 of RMB2.21
+per 10 shares (before tax), subject to the approval of the forthcoming 2021 Annual General
+Meeting. If approved, the 2021 final dividend on the Bank's ordinary shares will be denominated
+and declared in RMB and paid in RMB or equivalent Hong Kong dollars. The actual amount
+distributed in Hong Kong dollars will be calculated according to the average of the exchange
+rates of HKD to RMB announced by PBOC in the week before the date of the Bank's Annual
+General Meeting. The A-Share dividend distribution date is expected to be 15 July 2022 and the
+H-Share dividend distribution date is expected to be 10 August 2022 in accordance with relevant
+regulatory requirements and business rules. No capitalisation of the capital reserve to share
+capital is proposed in this profit distribution.
+Results and Profit Distribution
+Dividend
+per share
+In accordance with Article 83 of the Implementation Rules of Enterprise Income Tax Law of the
+People's Republic of China, dividends, bonuses and other equity investment proceeds distributed
+between qualified resident enterprises referred to in Article 26.2 of the Enterprise Income Tax
+Law of the People's Republic of China mean those investment proceeds obtained from direct
+investment of resident enterprises into other resident enterprises, excluding those investment
+proceeds obtained from publicly offered and tradable stocks of resident enterprises held for less
+than 12 months on a continuing basis.
+In accordance with the provisions of the Enterprise Income Tax Law of the People's Republic of
+China and the Implementation Rules of the Enterprise Income Tax Law of the People's Republic
+of China, dividend income from domestic preference shares distributed between qualified resident
+enterprises are non-taxable, and dividend income from domestic preference shares obtained by
+non-resident enterprises shall be levied at a preferential enterprise income tax rate of 10%.
+In accordance with the provisions of Article 26.2 of the Enterprise Income Tax Law of the
+People's Republic of China, dividends, bonuses and other equity investment proceeds distributed
+between qualified resident enterprises shall be tax-free.
+In accordance with the Enterprise Income Tax Law of the People's Republic of China and the
+Implementation Rules of the Enterprise Income Tax Law of the People's Republic of China,
+dividend income obtained by non-resident enterprises shall be levied at a preferential enterprise
+income tax rate of 10%.
+185
+H-Share Holders
+186
+In accordance with the provisions of the Notice on Issues concerning Withholding the Enterprise
+Income Tax on Dividends Paid by Chinese Resident Enterprises to H-share Holders who
+are Overseas Non-resident Enterprises (Guoshuihan [2008] No. 897) published by the State
+Administration of Taxation of PRC, when Chinese resident enterprises distribute annual
+dividends for 2008 onwards to H-share holders who are overseas non-resident enterprises, the
+enterprise income tax shall be withheld at a uniform rate of 10%.
+In accordance with the current practice of the Inland Revenue Department of Hong Kong, no tax
+is payable in Hong Kong in respect of dividends on H Shares paid by the Bank.
+The tax and tax relief of Shanghai-Hong Kong Stock Connect shall comply with the Notice on
+the Relevant Taxation Policy regarding the Pilot Programme that Links the Stock Markets in
+Shanghai and Hong Kong issued jointly by MOF, State Administration of Taxation of PRC, and
+CSRC.
+Domestic Preference Share Holders
+The individual income tax levied on dividends obtained by individuals from non-public issuance
+of domestic preference shares is calculated in accordance with the relevant Chinese tax laws and
+regulations.
+In accordance with Chinese tax laws and regulations, the dividends and bonuses received by
+overseas resident individual shareholders from stocks issued by domestic non-foreign investment
+enterprises in Hong Kong are subject to the payment of individual income tax, which shall be
+withheld by the withholding agents. However, overseas resident individual shareholders of stocks
+issued by domestic non-foreign investment enterprises in Hong Kong are entitled to the relevant
+preferential tax treatment pursuant to the provisions in the tax agreements signed between the
+countries in which they are residents and China, or to the tax arrangements between the Chinese
+mainland and Hong Kong and Macao. Accordingly, the Bank generally withholds 10% of the
+dividends to be distributed to the individual H-Share Holders as individual income tax unless
+otherwise specified by the relevant tax laws, regulations and agreements.
+In accordance with the provisions of the Notice on Implementing Differentiated Individual Income
+Tax Policy for Stock Dividends and Bonuses of Listed Companies (Caishui [2012] No. 85) and the
+Notice on Differentiated Individual Income Tax Policy for Stock Dividends and Bonuses of Listed
+Companies (Caishui [2015] No. 101) issued jointly by MOF, State Administration of Taxation
+of PRC and CSRC, for shares of listed companies obtained by individuals from public offerings
+or the transfer market, where the holding period is less than one month (inclusive), the dividends
+and bonuses shall be counted as taxable income in the full amount; where the holding period is
+more than one month and less than one year (inclusive), 50% of the dividends and bonuses shall
+be counted as taxable income on a provisional basis; and where the holding period exceeds one
+year, the dividends and bonuses shall not be counted as taxable income on a provisional basis.
+The individual income tax rate of 20% shall be applicable for all incomes mentioned above. The
+individual income tax levied on dividends and bonuses obtained by equity investment funds from
+listed companies is also calculated in accordance with the aforementioned rules.
+During the reporting period, the Bank renewed its directors' liability insurance to provide
+protection against claims arising from the lawful discharge of duties by the directors, thus
+encouraging the directors to fully perform their duties.
+Shareholders of the Bank are taxed in accordance with the following tax regulations and the
+amendments thereof from time to time. They shall enjoy possible tax relief according to the
+actual situation. Shareholders should seek professional advice from their tax and legal advisors.
+The following cited laws, regulations and stipulations are all relevant provisions issued before 31
+December 2021.
+For details, please refer to the related announcements on the websites of SSE, HKEX and the
+Bank and the Notes to the Consolidated Financial Statements.
+All proceeds raised from initial public offerings, issuance of subordinated bonds, the rights issue,
+issuances of tier 2 capital bonds, preference shares and undated capital bonds have been used to
+replenish the Bank's capital and increase the level of capital adequacy.
+Use of Raised Funds
+For disclosures of the Bank in respect of business review under Article 28 of Appendix 16 to
+the Hong Kong Listing Rules, please refer to sections "Management Discussion and Analysis"
+and “Corporate Social Responsibilities” and the Consolidated Financial Statements. The relevant
+disclosure constitutes part of the Report of the Board of Directors.
+Business Review
+184
+The Bank has not been engaged in any equity-linked agreement during the reporting period.
+Equity-linked Agreement
+As stipulated in the Articles of Association, within the scope permitted under applicable laws,
+administrative regulations and the Articles of Association, the Bank may purchase and maintain
+any liabilities insurance for the Bank's former and incumbent directors. The Bank will indemnify
+every former and incumbent director out of its own assets against any liability incurred when he/
+she served as director of the Bank to the maximum extent permitted by law and administrative
+regulations or alternatively to the extent that it is not prohibited by law and administrative
+regulations unless it is established that the director has not acted honestly or in good faith in
+performing his/her duties.
+Permitted Indemnity Provision
+There are no compulsory provisions for pre-emptive rights requiring the Bank to offer new
+shares to existing shareholders in proportion to their existing shareholdings under the Articles
+of Association. The Articles of Association provide that the Bank may increase its capital by
+public offering, private placing, issuing rights of new shares to existing shareholders or allotting
+new shares to existing shareholders, transferring its capital reserve, issuing convertible bonds,
+or through other means as permitted by laws, administrative regulations and relevant regulatory
+authorities.
+Pre-emptive Rights
+Offshore Preference Share Holders
+A-Share Holders
+In accordance with Chinese tax laws and regulations, when distributing dividends to overseas
+non-resident enterprises on offshore preference shares, the Bank shall withhold enterprise income
+tax at a rate of 10%.
+Incumbent Supervisors
+Bank.
+HUI Ping
+ZHENG Zhiguang
+JIANG Xiangsen
+LENG Jie
+ZHOU Hehua
+WEI Hanguang
+ZHANG Keqiu
+For details of the Bank's redemption of the Domestic Preference Shares (Second Tranche), please
+refer to the section “Changes in Shares and Shareholdings of Shareholders” and the Notes to the
+Consolidated Financial Statements.
+Supervisors
+In 2021, the attendance rate of each supervisor of the meetings of the Board of Supervisors is
+given below:
+In 2021, the Bank convened four on-site meetings of the Board of Supervisors on 30 March, 29
+April, 30 August, 29 October, respectively, as well as three meetings by written resolution of the
+Board of Supervisors. At these meetings, the Board of Supervisors reviewed and approved 44
+proposals regarding the Bank's four regular reports, 2020 profit distribution plan, 2020 internal
+control assessment report, 2020 corporate social responsibility report, 2020 work report of the
+Board of Supervisors, evaluation opinions of the Board of Supervisors on the duty performance
+and due diligence of the Board of Directors, the Senior Management and its members for
+2020, amendments to parts of the Articles of Association relating to the Board of Supervisors,
+amendments to the Rules of Procedure of the Board of Supervisors of Bank of China Limited,
+formulation of the Measures for the Performance Evaluation of the Board of Directors, the
+Board of Supervisors, the Senior Management and its Members of Bank of China Limited
+(Trial), performance evaluation results for the Chairperson of the Board of Supervisors for 2020,
+and the implementation plan on performance management for the Chairperson of the Board
+of Supervisors in 2021, performance evaluation results and remuneration distribution plan for
+external supervisors, advice on nominating Mr. HUI Ping as the external supervisor of the Bank,
+appointment of Ms. WEI Hanguang as member of the Duty Performance and Due Diligence
+Supervision Committee of the Board of Supervisors, and the appointment of Mr. ZHOU Hehua as
+member of the Duty Performance and Due Diligence Supervision Committee and the Finance and
+Internal Control Supervision Committee of the Board of Supervisors, among others. In addition,
+the Board of Supervisors issued 20 supervision and evaluation opinions regarding the Board of
+Supervisors on the Bank's strategy implementation in 2020, and the Bank's duty performance
+in information disclosure, internal control compliance in its foreign exchange business, capital
+management, liquidity risk management, consolidated management, stress test management,
+comprehensive risk management, internal control, case prevention, anti-money laundering
+management, compliance management, internal audit, data governance, existing wealth
+management rectification, consumer protection, product management, remuneration management,
+employee behaviour management and market risk management.
+Meetings of the Board of Supervisors
+Report of the Board of Supervisors
+29 March 2022
+LIU Liange
+Chairman
+On behalf of the Board of Directors
+188
+Auditors
+Please refer to the section “Corporate Governance
+details of the Bank's external auditors.
+Consumer Rights Protection
+Appointment of External Auditors" for
+The Bank set up the Corporate Culture and Consumer Protection Committee under the Board
+of Directors to take charge of the overall planning and guiding of the Group's corporate culture
+fostering and consumer protection.
+In terms of policy formulation, in 2021, the Bank formulated the Consumer Protection Policy
+of Bank of China Limited (Version 2021) and the Guidelines on the Management of Consumer
+Financial Marketing and Publicity of Bank of China Limited (Version 2021), and revised and
+issued the Charter of the Consumer Protection Committee of Bank of China Limited (Version
+2021), the Management Measures of Bank of China Limited for Customer Complaints (Version
+2021) and other rules for consumer protection. The Bank further specified the top-level design,
+overall management, marketing management, complaint management and dispute settlement for
+consumer protection and pushed for their implementation.
+In accordance with the current practice of the Inland Revenue Department of Hong Kong, no tax
+is payable in Hong Kong in respect of the dividends on offshore preference shares paid by the
+187
+In terms of complaint management, the Bank adhered to its "customer-centric" business
+philosophy and reinforced efforts to fulfill its responsibilities. It optimised service procedures
+and continuously improved customer service experience, thus effectively protecting the legitimate
+rights and interests of consumers. There were 148 thousand complaints in 2021, a year-on-year
+decline of 21.1%, representing a downward trend in the total number of annual complaints. Based
+on analysis by business type, 50.3% of the complaints were about credit cards, 18.1% about debit
+cards, and 8.1% about loans. The above three types of complaints accounted for 76.5% of the
+total. From the perspective of complaint reason, 57.4% of the complaints were about policies
+and procedures, 12.6% about fee rates, and 11.8% about services. The above three types of
+complaints accounted for 81.8% of the total. From the perspective of geographical distribution,
+the top five regions in terms of number of complaints in 2021 were Guangdong, Jiangsu, Beijing,
+Hebei and Shandong.
+For detailed information on the Bank's consumer protection, please refer to the Corporate Social
+Responsibility Report of Bank of China Limited for 2021 (Environmental Social Governance).
+Members of the Board of Directors
+Executive Directors: LIU Liange, LIU Jin, WANG Wei, LIN Jingzhen
+Non-executive Directors: XIAO Lihong, WANG Xiaoya, ZHANG Jiangang, CHEN Jianbo
+Independent Directors: WANG Changyun, Angela CHAO, JIANG Guohua, Martin Cheung Kong
+LIAO, CHEN Chunhua, CHUI Sai Peng Jose
+In terms of consumer publicity and education, the Bank actively organised all institutions to
+carry out publicity and education campaigns on consumer protection and built a publicity and
+education system wherein the Head Office, branches and comprehensive operation companies
+coordinate with each other and online and offline activities are integrated. During publicity
+campaigns themed on “3.15 Rights •Responsibilities • Risks, Financial Consumer Rights Day",
+the “Promoting Financial Knowledge, Protecting Personal Wealth”, the “Financial Knowledge
+Popularisation" and the "Month of Financial Knowledge Popularisation" held in March, June and
+September, the Bank launched a variety of stimulating publicity and educational activities both
+at its outlets and through online media platforms such as WeChat, Weibo, its official website,
+mobile banking and TikTok, which received warm recognition from regulatory authorities and
+consumers. For both of the "3.15 Consumer Protection Education and Publicity Week" and the
+"September Joint Financial Education and Publicity Campaign” in 2021, the Bank was awarded
+the honorary title of "Excellent Organiser” among banking institutions by regulators. It was
+also repeatedly praised by regulators for its contributions to the “Financial Consumer Rights
+Day", "Promoting Financial Knowledge, Protecting Personal Wealth” and “Month of Financial
+Knowledge Popularisation • Be Rational Financial Investors and Netizens” campaigns.
+Purchase, Sale or Redemption of the Bank's Securities
+Financial Summary
+Share Appreciation Rights Plan and Share Option Scheme
+Closure of H-Share Register of Members
+The dividend distribution plans for preference shares of the Bank have been approved by the
+Board of Directors. In 2021, the Bank distributed dividends on domestic and offshore preference
+shares in strict compliance with the Articles of Association, the terms of issuance of preference
+shares and the Board of Directors' resolutions on dividend distribution.
+Dividend payments are independent of the Bank's credit rating, nor do they vary with the credit
+rating.
+The preference share dividend is non-cumulative. If any preference share dividend for any
+dividend period is not paid in full, such remaining amount of dividend shall not be carried
+forward to the following dividend year. The Bank shall be entitled to cancel the payment of any
+dividend of the preference shares, and such cancellation shall not constitute a default. The Bank
+may at its discretion use the funds arising from the cancellation of such dividend payment to
+repay other indebtedness due and payable.
+180
+Dividends on the Bank's preference shares will be distributed on an annual basis. Once the
+preference shareholders have received dividends at the specified dividend rate, they shall not be
+entitled to participate in the distribution of the remaining profits of the Bank together with the
+ordinary shareholders.
+The preference shareholders of the Bank receive dividend at the specified dividend rate prior to
+the ordinary shareholders. The Bank shall pay the dividend to the preference shareholders in cash.
+The Bank shall not distribute dividends on ordinary shares before all the dividends on preference
+shares have been paid.
+Preference Shares
+The dividend distribution plan for ordinary shares of the Bank has been approved by the
+shareholders' meeting. In 2021, the Bank distributed dividends on ordinary shares for 2020
+in strict compliance with the Articles of Association, its dividend distribution policy and the
+shareholders' meeting resolution on profit distribution.
+The procedure to formulate the aforementioned dividend distribution policy was compliant,
+transparent and complete. The criterion and ratio of the dividend are explicit and clear. The
+independent directors fully expressed their opinions and the legitimate rights and interests of
+minority shareholders were fully respected and protected. The procedure was in line with the
+provisions of the Articles of Association and other rules and regulations.
+The Articles of Association of the Bank states that the Bank should maintain the continuity and
+stability of its profit distribution policy. It also clarifies the Bank's profit distribution principles,
+policy and adjustment procedures, the consideration process of the profit distribution plan and
+other matters. The Bank shall adopt cash dividend as the priority form of profit distribution.
+Except under special circumstances, the Bank shall adopt cash as the form of dividend
+distribution where there is profit in that year and the accumulated undistributed profit is positive,
+and that the cash distribution of the dividend shall not be less than 10% of the profit after tax
+attributable to the ordinary shareholders of the Bank. The Bank shall offer online voting to
+shareholders when considering amendments to the profit distribution policy and profit distribution
+plan.
+The Bank takes full account of the return to shareholders, and also takes into account the long-
+term interests of the Bank, the overall interests of all its shareholders and the sustainable
+development of the Bank.
+Ordinary Shares
+Formulation and Implementation of Cash Dividend Policy
+The H-Share register of members of the Bank will be closed from Saturday, 9 July to Thursday,
+14 July 2022 (both days inclusive), for the purpose of determining the list of shareholders
+entitled to the proposed final dividends on ordinary shares. In order to qualify for the proposed
+final dividends, the H-Share Holders of the Bank who have not registered the relevant transfer
+documents are required to lodge them, together with the relevant share certificates, with the
+H-Share Registrar of the Bank, Computershare Hong Kong Investor Services Limited, at Rooms
+1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong, China,
+no later than 4:30 p.m. on Friday, 8 July 2022. The ex-dividend date of the Bank's H Shares will
+be on Thursday, 7 July 2022.
+Former Supervisors
+LI Changlin
+Number of meetings attended in person/
+Number of meetings convened during term of office
+7/7
+2/2
+2/2
+7/7
+7/7
+7/7
+0/0
+0/0
+3/3
+5/5
+189
+WANG Xiquan
+Please refer to Note V.34 to the Consolidated Financial Statements for details of the share
+appreciation rights plan and share option scheme of the Group.
+Donations
+Share Capital
+183
+No contract concerning the management or administration of the whole or any substantial part of
+the business of the Bank was entered into or existed during the reporting period.
+Management Contracts
+Please refer to the section “Changes in Shares and Shareholdings of Shareholders" for the details
+of the Bank's substantial shareholder interests.
+Substantial Shareholder Interests
+Directors of the Bank are not related to one another with respect to finance, business and family,
+or other material relations.
+Financial, Business and Family Relations among Directors
+To the best knowledge of the Bank, as at 31 December 2021, none of the directors or supervisors
+of the Bank or their respective associates had any interests or short positions in the shares,
+underlying shares or debentures of the Bank or any of its associated corporations (within the
+meaning of Part XV of the SFO) as recorded in the register required to be kept by the Bank
+pursuant to Section 352 of the SFO or as otherwise notified to the Bank and the Hong Kong Stock
+Exchange pursuant to the Model Code as set out in Appendix 10 of the Hong Kong Listing Rules.
+Directors' and Supervisors' Interests in Shares, Underlying Shares
+and Debentures
+During the reporting period, none of the Bank, its holding companies, or any of its subsidiaries
+or fellow subsidiaries was a party to any arrangement that would enable the Bank's directors and
+supervisors, or their respective spouses or children below the age of 18, to benefit by acquiring
+shares in, or debentures of, the Bank or any other body corporate.
+Directors' and Supervisors' Rights to Acquire Shares
+No transaction, arrangement or contract of significance, in relation to the Bank's business to
+which the Bank, its holding companies, or its subsidiaries or fellow subsidiaries was a party and
+in which a director or a supervisor or any entity connected with them was materially interested,
+directly or indirectly, subsisted during the reporting period.
+Directors' and Supervisors' Interests in Transactions, Arrangements
+and Contracts of Significance
+None of the directors or supervisors of the Bank has a service contract with the Bank or its
+subsidiaries that is not determinable within one year or is not determinable without payment of
+compensation other than normal statutory compensation.
+Charitable donations made by the Group during the reporting period amounted to approximately
+RMB98.54 million.
+Directors' and Supervisors' Service Contracts
+Please refer to the section "Directors, Supervisors and Senior Management Members" for details
+of the remuneration of directors, supervisors and senior management members.
+The Bank has formulated a clear regulation on the remuneration of directors, supervisors
+and senior management members. The remuneration for Chairman of the Board of Directors,
+President, Chairperson of the Board of Supervisors and executive vice presidents shall be paid
+in accordance with the rules on remuneration reform for central enterprises, which consists of
+basic annual remuneration, performance-based annual remuneration and incentive income linked
+to term appraisal. The remuneration for other senior management members and shareholder
+supervisors consists of basic annual remuneration and performance-based remuneration, with
+part of performance-based remuneration paid in a deferred manner. According to the recourse
+and recovery mechanism for performance-based remuneration of the Bank, if risk losses
+falling within the employees' remit and responsibility are exposed in excess during the term of
+service, the Bank may recover part or all of the performance-based remuneration paid within
+the corresponding period, and stop the payment of the part that has not been paid. Independent
+directors as well as external supervisors and employee supervisors are remunerated by the Bank
+while non-executive directors are not remunerated by the Bank. The Bank remunerates directors,
+supervisors and senior management members who are employed by the Bank with salaries,
+bonuses, employer contributions to social insurance, enterprise annuity, supplementary medical
+insurance and housing provident fund, as well as other monetary income.
+Remuneration Policy of Directors, Supervisors and Senior
+Management Members
+None of the directors has interests in any business that competes or is likely to compete, either
+directly or indirectly, with the business of the Group.
+Directors' Interests in Competing Businesses of the Bank
+Under the Hong Kong Listing Rules, transactions between the Bank and its connected persons
+(as defined under the Hong Kong Listing Rules) constitute connected transactions to the Bank.
+Such transactions are monitored and administered by the Bank in accordance with the Hong
+Kong Listing Rules. In 2021, the Bank has engaged in a number of connected transactions
+with its connected persons in the ordinary and usual course of its business. Such transactions
+are exempted from the reporting, annual review, announcement and independent shareholders'
+approval requirements according to the Hong Kong Listing Rules.
+Connected Transactions
+Please refer to the section "Financial Highlights" for the summary of the annual results, assets
+and liabilities of the Bank for the last five years.
+Please refer to Note V.20 to the Consolidated Financial Statements for details of the fixed assets
+of the Bank.
+Fixed Assets
+181
+Please refer to Note V.38 to the Consolidated Financial Statements for details of distributable
+reserves of the Bank.
+Distributable Reserves
+As at the latest practicable date prior to the issue of this annual report, the Bank had sufficient
+public float based on publicly available information, in compliance with the minimum
+requirement of the Hong Kong Listing Rules and the waiver granted by the Hong Kong Stock
+Exchange at the time of the Bank's listing.
+182
+WANG Zhiheng
+Tax and Tax Relief
+Unit: RMB million
+PricewaterhouseCoopers Zhong Tian LLP
+Office Address:
+Room 01, Unit 507, DBS Bank Tower,
+1318 Lu Jia Zui Ring Road,
+Pudong New Area, Shanghai, China
+Certified Public Accountants who signed
+the auditor's report:
+Ms. Ho Shuk Ching Margarita,
+Mr. Zhu Yu, Mr. Li Dan
+International Auditor
+PricewaterhouseCoopers
+Office Address:
+22/F, Prince's Building,
+Central, Hong Kong, PRC
+Domestic Auditor
+13
+911000001000013428
+Financial Institution Licence Serial Number
+B0003H111000001
+Registered Capital
+RMB294,387,791,241
+Securities Information
+A Share
+Shanghai Stock Exchange
+Stock Name: 中國銀行
+Stock Code: 601988
+H Share
+The Stock Exchange of Hong Kong Limited
+Stock Name: Bank of China
+Unified Social Credit Code
+Stock Code: 3988
+Auditors
+King & Wood Mallesons
+Telephone: (86) 10-6659 2638
+Facsimile: (86) 10-6659 4568
+E-mail: ir@bankofchina.com
+Registered Address
+No. 1 Fuxingmen Nei Dajie, Xicheng District,
+Beijing, China
+Office Address
+No. 1 Fuxingmen Nei Dajie, Xicheng District,
+Beijing, China, 100818
+Telephone: (86) 10-6659 6688
+Facsimile: (86) 10-6601 6871
+Website: www.boc.cn
+Customer Service and Complaint Hotline:
+(86) Area Code-95566
+Clifford Chance
+Place of Business in Hong Kong
+Central, Hong Kong, China
+Selected Newspapers for Information
+Disclosure (A Share)
+China Securities Journal, Shanghai Securities News,
+Securities Times, Securities Daily
+Website of SSE for
+Publication of the Annual Report
+www.sse.com.cn
+Website of HKEX for Publication of the
+Annual Report
+www.hkexnews.hk
+Place where Annual Report can be Obtained
+Head Office of Bank of China Limited
+Shanghai Stock Exchange
+Legal Advisor
+Bank of China Tower, 1 Garden Road,
+Domestic Preference Share
+Shanghai Stock Exchange
+Third Tranche
+The Bank owes its success throughout different periods to its clear understanding and respect of
+the general patterns or principles of economic and financial activities, as well as deep insights
+into market trends and customer needs. Now that we find ourselves in a new world of constant
+changes and great uncertainty, it has become even more important for us to observe the rules and
+patterns while adapting to the trends of times; and to stick to the path of financial development
+with Chinese characteristics, featuring the rule of law and market mechanisms. Such an approach
+will equip us with the global perspective and keen receptiveness required to adapt, and maintain
+confidence and composure while navigating challenges.
+18
+Prudence and integrity as our unshakable tenets
+Banks are a special type of commercial organisation in that the commodities banks deal in
+currencies, capital, and credit - play a distinct role in the functioning of the society, warranting
+prudence and integrity, which we have taken as our ironclad tenets from the very beginning.
+Facing profound changes unseen in a century now, we've exercised extra cautions, stayed vigilant
+against potential risks, and further strengthened our comprehensive risk management system, as
+we believe this is the only and sure way to protect our customers' interest, ensure financial and
+social stability, while sustaining long-term growth across economic cycles.
+As an old saying in Chinese goes, the power of will knows no bounds, not even summits
+unattempted or oceans most profound. Our people have time and again proved their strong
+will as well as their professionalism in the past 110 years of excellence, and are now ready to
+write a new chapter with renewed commitment. In 2022, we will continue to find guidance and
+inspiration from Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and
+our century-long legacy, and focus our efforts on: making our financial services more adaptive,
+inclusive, and competitive; facilitating higher-level opening-up; fully utilising our strength in
+overseas network for better integration into global finance governance; and launching cross-
+border products or solutions that are more efficient and accessible. These initiatives will aid our
+ongoing campaign of building a first-class global banking group and contributing to the national
+rejuvenation, while helping us deliver greater results and satisfy the expectations of not only the
+times, but also our country and its people, and our clients and shareholders.
+19
+LIU Liange
+Chairman
+29 March 2022
+16.22
+16.53
+12.02
+12.27
+Adaptability sustains a long-standing business
+12.79
+13.32
+11.15
+11.41
+11.30
+11.28
+11.30
+Common equity tier 1 capital adequacy
+264,240
+347,057
+105,002
+109,524
+1,356,088
+13.19
+We've long put customers in the centre of everything we do, a fine tradition that dates back to the
+1930s, when the Bank proclaimed “Bank of China by nature is a bank for all 400 million fellow
+Chinese". It was then attested by our perseverance with providing cash delivery and payment
+services to people in front-line cities during Japanese aggression in the Second World War; and
+has since been carried over to this day, as we accelerate the building of strategic scenario-based
+business ecosystems, including cross-border facilitation, education, sports and silver economy, to
+create better customer experience. As always, we will continue to "provide excellent services" to
+our customers, to increase their wealth and bring convenience to their life; we've also installed a
+people-oriented mentality in taking care of our own staff. We believe this consistency on people
+centricity enhances our reputation and serves as a source of our strength. This approach will
+create more value not only for our external customers, but also for our own employees and our
+organisation.
+People-centered approach leads to excellence
+17
+Stock Name: 中行優3
+Stock Code: 360033
+Fourth Tranche
+Stock Name: 中行優4
+Stock Code: 360035
+Offshore Preference Share
+Second Tranche
+The Stock Exchange of Hong Kong Limited
+Stock Name: BOC 20USDPREF
+Stock Code: 4619
+14
+Message from the Chairman
+2021 was a critical year as we've summed up the past and gained new strength, while laying
+out plans for the future. We witnessed the historic convergence of the "Two Centenary Goals"
+of our country, and the resounding success in eliminating extreme poverty for all Chinese. We
+withstood a global pandemic in its second year, while still managing to advance our support to
+the real economy, accelerate reform and innovation, and increase our resilience against risks. The
+Bank delivered solid financial performance in 2021: the Group achieved a profit for the year of
+RMB227.339 billion an increase of 10.85% year-on-year; a profit attributable to equity holders
+of the Bank was RMB216.559 billion, up 12.28% from the previous year; ratio of non-performing
+loans was 1.33%, down 0.13 percentage point from the prior year end; and the allowance for loan
+impairment losses to non-performing loans was 187.05%, up 9.21 percentage points from the
+prior year end. The Board of Directors has proposed a cash dividend of RMB2.21 per ten ordinary
+shares for 2021, representing a dividend payout ratio of 30%.
+Also in the year, a new blueprint has been drawn for the Group's development during the 14th
+Five-Year-Plan period, in line with strategies and policies of the country and of the Party, which
+will guide and inspire our over 300,000 colleagues, united under the vision of building a first-
+class global banking group, to continue working hard to live up to the mission of bridging China
+and the world for the common good.
+Broader support to the real economy from the “Eight Priority Areas"
+We've adopted the new development philosophy and identified technology finance, green
+finance, inclusive finance, cross-border services, consumer finance, wealth management, supply
+chain finance, and county-level financial services, as the "Eight Priority Areas" where we
+will increase our presence and build new growth drivers. Doing so allows us to optimise the
+structure of our offerings of financial services, and better support high-quality development of
+the economy. Throughout the year, we continued to step up support to corporate customers in
+the technology sector, extending credit facilities to over 33 thousands of them; meanwhile, our
+debt-equity combination financing for tech firms also gained traction. A full line-up of diverse
+green financial products, was established and still growing, while our green credit balance
+experienced a surge. In inclusive finance, we integrated our corporate and retail functions
+for higher efficiency, which drove a drastic growth in inclusive loans. Progress was made in
+our cross-border services as well, as we pioneered the H-Share full circulation program, the
+Southbound Bond Connect, the Cross-border Wealth Management Connect, and many other
+initiatives, securing our lead in the market. Similarly, our presence in consumer finance and
+wealth management increased, with more offerings launched in the market and the AUM in the
+retail business exceeding RMB11 trillion. We also upgraded our supply chain finance services,
+now branded "BOC Smart Chain”, which contributed to strengthening the supply chain of many
+key industries. And finally, leveraging our resources at the county level, we took well-targeted
+actions to facilitate the poverty alleviation campaign and support rural revitalisation program.
+15
+New "One Mainstay, Two Engines” strategy to build on century-long legacy
+As the new development pattern in China starts to take hold, whereby the domestic and
+international economic circulations reinforce each other, we've located our new strategy to focus
+on our competitive advantages, which features domestic commercial banking as the mainstay of
+our Group, and globalised operations and diversified business platforms as two growth engines.
+The goal is to allow our customers access to the Bank's global resources and services at any
+point of contact. In 2021, domestic contribution to our total revenue increased, with steady
+growth reported both in key businesses and key regions. On the side of our overseas network,
+we demonstrated resilience against the pandemic and managed to maintain stable operations. We
+also promoted the synergy between our banking arms and non-banking business platforms and
+turned it into as a key enabler of business and growth, as evidenced in the improved profitability
+and higher contribution to the Group reported by the latter. In addition, we provided high-quality
+financial services to the 2022 Beijing Winter Olympic Games as its official banking partner.
+Having sponsored the 2008 Beijing Summer Olympic Games, we are the only bank in the world
+to sponsor both the Winter and Summer Games; and we've seized this opportunity to launch a
+series of Olympics-related banking services, to help promote the national campaign of engaging
+300 million people in winter sports.
+Digital transformation to accelerate future-facing innovation
+We've always watched technological advancements and industrial trends with keen interest, and
+invested heavily in digital transformation and other key innovations that will better position us for
+the future. We achieved initial success in promoting the four strategic scenarios, including cross-
+border facilitation, education, sports, and silver economy; helped by our publication of the White
+Paper on the Development of Scenario-based Financial Services Ecosystem, the first of its kind.
+We also launched an updated mobile banking APP with additional functions, and registered an
+exponential growth in e-CNY wallet activation. In addition, we've gone all out to accelerate the
+development of enterprise-level architectures, and foster mindsets and systems compatible with
+digital transformation. With many of the enterprise-level capabilities being formed and an initial
+version of the "Three Horizontals, Two Verticals and One Line” data governance framework now
+in place, we expected sizable flows of dividend from data assets in the years ahead.
+Comprehensive risk management for a stronger footing
+As uncertainty and complexity grew in the external environment, we continued to exercise
+caution and promoted a proactive approach to risk prevention and control, with equal emphasis
+on stability and growth. We strengthened the comprehensive risk management system of the
+Group and significantly reduced vulnerabilities; especially, we enhanced differentiated support
+to overseas institutions and look-through management of non-banking arms. We also optimised
+credit policies for inclusive finance and retail customers, and launched pilot reform programs for
+credit management in overseas markets. In addition, further improvements were made to our anti-
+money laundering system. Risk levels, including that of liquidity risk and market risk, remained
+stable at the moment.
+16
+Culture building to promote shared values
+Rooted deeply in over a century of history and traditions, the Bank's values of "providing
+excellent service, innovating with prudence, upholding openness and inclusiveness, and
+collaborating for mutual growth” form the foundation of our corporate culture; and we've taken
+measures to institutionalise and translate these values and culture into true competitiveness.
+In addition, we integrated the leadership of the Party into corporate governance, giving full
+play to its core function of “setting the right direction, overseeing the big picture, and ensuring
+implementation of policies and principles"; we also leveraged the Party's political strength,
+organisation strength, as well as its strength in mass work to advance reforms and support the
+Bank's development. We encouraged benchmarking and best practice sharing at all levels, which
+yielded good results especially in raising the mentality of providing excellent service. We stepped
+up efforts to upgrade systems, optimise workflows, and promote differentiated management, in
+order to enhance our capacity for innovating with prudence. As a consequence, various types of
+flexible organisations were established to pick up customer needs at speed, by making extensive
+and full use of standardised modular products and services, contributing towards an open and
+inclusive ecosystem. Moreover, nearly 260 financing projects were executed jointly by banking
+and non-banking platforms within the Group, which has further demonstrated the effect and
+benefits of collaborating for mutual growth, and paved the way for future breakthrough in the
+synergy between culture building and business development.
+2022 marks the 110th anniversary of Bank of China. 110 years ago, the Bank set its purpose
+to serve the social and economic development of the country through finance. To that end, our
+people have since worked hard and tirelessly to overcome all headwinds and challenges, and
+charted a course for a better future through both tenacity and ingenuity. Now in its second century
+of operation, the Bank remains a living witness to the great rejuvenation of our nation, and has
+left a rich legacy of its own that grows more relevant by the day.
+Service to the country is the way to prosperity
+From an early history punctuated by turmoil and upheaval, the Bank emerged strong as a national
+champion in finance. A period of fast growth ensued, thanks to the peace and stability brought
+by the founding of the People's Republic of China. The Bank received a further boost from the
+reform and opening-up campaign afterwards, and has now renewed its aspiration of excellence
+in the new development stage. It has been clear from the start that the Bank has always found
+strength in the development of, and more importantly, in its service to the country, as was
+pledged in its founding mission — “promoting the welfare of the society and bringing prosperity
+to the nation". We continue to be inspired by such purpose and resolve, and will carry through our
+duty to the national rejuvenation while pursuing business growth.
+Beijing, China
+1,465,769
+No. 1 Fuxingmen Nei Dajie, Xicheng District,
+YU Ke
+0.80
+0.95
+0.81
+Allowance for loan impairment losses to
+total loans (%)
+17
+2.83
+2.96
+2.97
+3.07
+2.77
+Exchange rate
+0.76
+USD/RMB year-end central parity rate
+6.5249
+6.9762
+6.8632
+6.5342
+EUR/RMB year-end central parity rate
+7.2197
+8.0250
+7.8155
+7.8473
+7.8023
+HKD/RMB year-end central parity rate
+0.8176
+6.3757
+0.8416
+0.66
+181.97
+14.19
+Asset quality
+Credit-impaired loans to total loans (%)
+Non-performing loans to total loans (%)
+11
+13
+1.33
+1.46
+1.37
+1.42
+1.45
+14
+159.18
+1.33
+1.37
+1.42
+1.45
+Allowance for loan impairment losses to
+non-performing loans (%)
+15
+Credit cost (%)
+16
+56
+187.05
+177.84
+182.86
+1.46
+0.8958
+0.8762
+0.8359
+Cost to income ratio is calculated in accordance with the Measures of the Performance Evaluation of Financial
+Enterprises (Cai Jin [2016] No. 35) formulated by the MOF.
+The capital ratios are calculated under the advanced approaches and in accordance with Capital Rules for
+Commercial Banks (Provisional) (Y.J.H.L. [2012] No. 1).
+Credit-impaired loans to total loans = credit-impaired loans at year-end ÷ total loans at year-end × 100%. Total
+loans are exclusive of accrued interest when being used to calculate credit-impaired loans to total loans.
+Non-performing loans to total loans = non-performing loans at year-end ÷ total loans at year-end × 100%. Total
+loans are exclusive of accrued interest when being used to calculate non-performing loans to total loans.
+Allowance for loan impairment losses to non-performing loans = allowance for loan impairment losses at year-
+end ÷ non-performing loans at year-end × 100%. Total loans are exclusive of accrued interest when being used to
+calculate allowance for loan impairment losses to non-performing loans.
+Credit cost = impairment losses on loans ÷ average balance of loans × 100%. Average balance of loans = (balance
+of loans at the beginning of the year + balance of loans at year-end) ÷ 2. Total loans are exclusive of accrued
+interest when being used to calculate credit cost.
+Allowance for loan impairment losses to total loans = allowance for loan impairment losses at year-end ÷ total
+loans at year-end × 100%. Calculation is based on the data of the Bank's institutions in the Chinese mainland.
+Total loans are exclusive of accrued interest when being used to calculate allowance for loan impairment losses to
+total loans.
+12
+Corporate Information
+Registered Name in Chinese
+中國銀行股份有限公司(“中國銀行")
+Registered Name in English
+BANK OF CHINA LIMITED
+17
+("Bank of China")
+LIU Liange
+Vice Chairman and President
+LIU Jin
+Secretary to the Board of Directors and
+Company Secretary
+MEI Feiqi
+Office Address:
+No. 1 Fuxingmen Nei Dajie, Xicheng District,
+Beijing, China
+Telephone: (86) 10-6659 2638
+Facsimile: (86) 10-6659 4568
+E-mail: ir@bankofchina.com
+Listing Affairs Representative
+Legal Representative and Chairman
+16
+15
+14
+11
+Notes:
+1
+2
+3
+4
+Starting on 1 January 2018, the Bank has applied International Financial Reporting Standard No. 9 - Financial
+Instruments (IFRS 9) published by the International Accounting Standards Board.
+Non-interest income = net fee and commission income + net trading gains/(losses) + net gains/(losses) on transfers
+of financial asset + other operating income.
+Allowance for loan impairment losses = allowance for loans at amortised cost + allowance for loans at fair value
+through other comprehensive income.
+The investments of 2021, 2020, 2019 and 2018 are presented under IFRS 9, which include financial assets at fair
+value through profit or loss, financial assets at fair value through other comprehensive income and financial assets
+at amortised cost. The comparative data of the previous reporting period was not restated accordingly.
+5
+Dividend per share is the dividend per ordinary share distributed to ordinary shareholders.
+6
+Net assets per share = (capital and reserves attributable to equity holders of the Bank at year-end - other equity
+instruments) number of ordinary shares in issue at year-end.
+7
+Return on average total assets = profit for the year average total assets × 100%. Average total assets = (total
+assets at the beginning of the year + total assets at year-end) ÷ 2.
+8
+9
+Return on average equity = profit attributable to ordinary shareholders of the Bank ÷ weighted average capital and
+reserves attributable to ordinary shareholders of the Bank × 100%. Calculation is based on No. 9 Preparation and
+Reporting Rules of Information Disclosure of Public Offering Companies Calculation and Disclosure of Return
+-
+on Average Equity and Earnings per Share (Revised in 2010) (CSRC Announcement [2010] No. 2) issued by the
+CSRC.
+Net interest margin = net interest income ÷ average balance of interest-earning assets × 100%. Average balance is
+average daily balance derived from the Group's management accounts (unaudited).
+10
+Non-interest income to operating income = non-interest income ÷ operating income × 100%.
+11
+12
+13
+Office Address:
+1,704,778 1,596,378
+287,843 210,057
+458,434 394,843
+1,843,886
+329,845
+525,108
+Capital adequacy ratio (%)
+%
+losses to non-performing loans
+Allowance for loan impairment
+29.08
+25.98
+27.75
+182.86
+2019
+181.97
+159.18
+1.46
+1.37
+177.84
+1.42
+2021
+2020
+2019
+2018
+2017
+2020 2021
+2019
+2018
+2017
+%
+Non-performing loans to total loans
+1.45
+2017 2018
+2021
+2020 2021
+2018
+2020
+201,891
+192,435
+184,986
+2021
+2020
+2019
+10.61
+%
+ROE
+11.45
+12.06
+12.24
+2019
+2017
+2021
+2020
+2019
+275,142
+246,220
+249,588
+227,533
+29.81
+%
+operating income
+Non-interest income to
+2018
+2020
+2019
+2018
+RMB Million
+Operating profit
+RMB Million
+Operating income
+Financial Highlights
+605,717
+2021
+2020
+2019
+567,647
+550,010
+503,806
+Profit for the year
+RMB
+2018
+2017
+483,761
+185
+%
+Net interest margin
+1.95
+%
+Credit cost
+0.95
+0.81
+10
+EPS (basic)
+RMB Million
+ROA
+%
+2017
+2021
+2020
+2019
+2018
+2017
+2021
+2020
+2019
+2018
+2017
+Cost to income ratio (calculated under
+regulations in the Chinese mainland)
+0.92
+0.94
+%
+28.34
+2017
+2021
+2020
+2019
+2018
+2017
+2019 2020 2021
+2018
+2017
+2017 2018
+221,741
+205,096
+14.97
+2021
+Note
+11.28
+0.98
+0.94
+0.92
+0.87
+0.89
+7899
+Non-interest income to operating income (%)
+Net interest margin (%)
+Return on average equity (%)
+Return on average total assets (%)
+4.74
+10.61
+5.14
+5.98
+6.47
+0.176
+0.184
+0.191
+0.197
+0.221
+0.56
+0.59
+0.61
+0.61
+0.70
+5.61
+1,851,701 1,612,980 1,496,016
+294,388 294,388 294,388
+11.45
+12.24
+Tier 1 capital adequacy ratio (%)
+ratio (%)
+Net tier 2 capital
+Net additional tier 1 capital
+Net common equity tier 1 capital
+12
+Capital ratios
+28.34
+28.09
+28.00
+26.73
+28.17
+12.06
+11
+Cost to income ratio (calculated under
+27.75
+25.98
+29.08
+26.73
+29.81
+10
+1.90
+1.95
+1.89
+1.85
+1.75
+regulations in the Chinese mainland, %)
+Note: The financial information in this report has been prepared in accordance with IFRS¹. The data are presented in
+RMB and reflect amounts related to the Group, unless otherwise noted.
+2,038,419
+294,388
+56
+134,226
+130,876
+159,960
+151,729
+180,575
+605,717 567,647
+(226,355) (202,411) (198,269)
+(104,220) (119,016) (102,153)
+275,142 246,220 249,588
+276,620 246,378 250,645
+205,096 201,891
+227,339
+Profit for the year
+Profit before income tax
+Operating profit
+Impairment losses on assets
+Operating expenses
+2
+550,010
+349,535
+390,050
+415,918
+425,142
+Operating income
+Non-interest income
+Net interest income
+Results of operations
+2017
+2018
+2019
+2020
+2021
+372,930
+2,225,153
+294,388
+503,806
+(176,979) (173,859)
+Key financial ratios
+Net assets per share (RMB)
+Dividend per share (before tax, RMB)
+Basic earnings per share (RMB)
+Per share
+Share capital
+equity holders of the Bank
+Capital and reserves attributable to
+Due to customers
+26,722,408 24,402,659 22,769,744 21,267,275 19,467,424
+15,712,574 14,216,477 13,068,785 11,819,272 10,896,558
+(390,541) (368,619) (325,923) (303,781) (252,254)
+6,164,671 5,591,117 5,514,062 5,054,551 4,554,722
+24,371,855 22,239,822 20,793,048 19,541,878 17,890,745
+18,142,887 16,879,171 15,817,548 14,883,596 13,657,924
+Total liabilities
+4
+483,761
+Investments
+Allowance for loan impairment losses
+Loans, gross
+Total assets
+Financial position
+180,086 172,407
+54,167 51,812
+187,405
+56,228
+192,870
+57,994
+N.A.
+Total dividend of ordinary shares
+216,559
+of the Bank
+Profit attributable to equity holders
+(99,294) (88,161)
+227,533 221,741
+229,643 222,903
+192,435 184,986
+3
+15.59
+199
+internal controls over significant
+management judgements and assumptions,
+including portfolio segmentation, parameter
+estimation, determination and application
+of criteria to identify significant increases
+in credit risk, default and credit-impaired
+assets, as well as economic indicators,
+economic scenarios and weightings used in
+forward-looking measurement;
+The Group assessed whether the credit risk of loans
+and advances to customers had increased significantly
+since their initial recognition, and applied a three-
+stage impairment model approach to calculate the
+ECL. For loans and advances to customers that are
+classified as stage 1 or stage 2, and those classified
+as stage 3 (impaired) with individual amount that are
+relatively insignificant, the Group assessed the ECL
+using the risk parameter modelling approach that
+incorporated relevant key risk parameters, including
+probability of default ("PD"), loss given default
+("LGD") and exposure at default ("EAD”). For loans
+and advances to customers classified as stage 3 with
+individual amount that are relatively significant, the
+Group assessed ECL for each loan by estimating the
+future cash flows from the loans.
+the consolidated statement of cash flows for the year then ended; and
+the consolidated statement of changes in equity for the year then ended;
+the consolidated statement of comprehensive income for the year then ended;
+the consolidated income statement for the year then ended;
+the consolidated statement of financial position as at 31 December 2021;
+•
+•
+•
+•
+The consolidated financial statements of Bank of China Limited (the “Bank”) and its subsidiaries
+(the "Group"), which are set out on pages 211 to 434, comprise:
+What we have audited
+Opinion
+(Incorporated in the People's Republic of China with limited liability)
+To the Shareholders of Bank of China Limited
+Independent Auditor's Report
+196
+Bank.
+For announcements regarding other significant events during the reporting period made in
+accordance with the regulatory requirements, please refer to the websites of SSE, HKEX and the
+For details of the Bank's Information on the Environmental, Social and Governance Performance,
+Please refer to the Corporate Social Responsibility Report of Bank of China Limited for 2021
+(Environmental Social Governance) published on the websites of SSE, HKEX and the Bank.
+Other Significant Events
+During the reporting period, neither the Bank nor its controlling shareholder failed to perform any
+obligations from effective legal instruments of the court or pay off any due debt in large amount.
+Information on the Environmental, Social and Governance Performance
+Integrity of the Bank and its Controlling Shareholder
+the notes to the consolidated financial statements, which include principal accounting
+policies and other explanatory information.
+During the reporting period, neither the Bank nor any of its directors, supervisors, senior
+management members or controlling shareholder was subject to compulsory measures due to
+alleged crimes, subject to criminal punishment, investigated by CSRC due to potential violation
+of laws and regulations or subject to administrative punishment by CSRC, or had material
+administrative punishment imposed on them by other competent authorities. None of the
+directors, supervisors or senior management members or controlling shareholder was detained by
+disciplinary inspection and supervision authorities due to any potential material breach of laws,
+disciplinary regulations or duty crimes, nor did any such matter affect its duty performance. None
+of the directors, supervisors or senior management members was subject to compulsory measures
+by other competent authorities due to potential violation of laws and regulations, nor did any such
+matter affect its duty performance.
+Our Opinion
+Basis for Opinion
+Refer to Note II 4.6, Note III 1, Note V 9, 17, 23 and
+Note VI 2.3 of the consolidated financial statements.
+Measurement of expected credit loss ("ECL") for loans and advances to customers
+How our audit addressed the Key Audit Matter
+Key Audit Matter
+Key Audit Matters (Continued)
+Independent Auditor's Report (Continued)
+198
+Consolidation of structured entities
+Valuation of financial investments measured at fair value
+.•
+Measurement of expected credit loss ("ECL") for loans and advances to customers
+•
+Key audit matters identified in our audit are summarised as follows:
+Key audit matters are those matters that, in our professional judgement, were of most significance
+in our audit of the consolidated financial statements of the current period. These matters were
+addressed in the context of our audit of the consolidated financial statements as a whole, and in
+forming our opinion thereon, and we do not provide a separate opinion on these matters.
+Key Audit Matters
+We are independent of the Group in accordance with the International Code of Ethics for
+Professional Accountants (including International Independence Standards) issued by the
+International Ethics Standards Board for Accountants ("IESBA Code”), and we have fulfilled our
+other ethical responsibilities in accordance with the IESBA Code.
+Independence
+Independent Auditor's Report (Continued)
+197
+We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
+basis for our opinion.
+We conducted our audit in accordance with International Standards on Auditing ("ISAs”). Our
+responsibilities under those standards are further described in the Auditor's Responsibilities for
+the Audit of the Consolidated Financial Statements section of our report.
+In our opinion, the consolidated financial statements give a true and fair view of the consolidated
+financial position of the Group as at 31 December 2021, and of its consolidated financial
+performance and its consolidated cash flows for the year then ended in accordance with
+International Financial Reporting Standards ("IFRSS") and have been properly prepared in
+compliance with the disclosure requirements of the Hong Kong Companies Ordinance.
+As at 31 December 2021, the carrying amount
+of loans and advances to customers in BOC's
+consolidated statement of financial position was
+RMB 15,322,484 million. Of these balances, the loans
+and advances to customers measured at amortised
+cost of RMB 15,319,394 million and loans and
+advances to customers measured at fair value through
+other comprehensive income of RMB351,795 million,
+together with accrued interest were subject to ECL
+measurement, and an impairment allowance of
+RMB390,541 million was recognised by management
+as at 31 December 2021. The impairment losses on
+loans and advances to customers recognised in the
+Group's consolidated income statement for the year
+ended 31 December 2021 amounted to RMB98,298
+million.
+Disciplinary Actions Imposed on the Bank, its Directors, Supervisors,
+Senior Management Members and Controlling Shareholder
+Undertakings
+Working Performance of the External Supervisors
+During the reporting period, Mr. JIA Xiangsen and Mr. ZHENG Zhiguang, the external
+supervisors of the Bank, performed their supervisory duty in strict accordance with the provisions
+of the Articles of Association of the Bank. They were present at shareholders' meetings, attended
+the meetings of the Board of Directors, the Strategic Development Committee, the Corporate
+Culture and Consumer Protection Committee, the Audit Committee, the Risk Policy Committee,
+the Personnel and Remuneration Committee and the Connected Transactions Control Committee
+as non-voting attendees, and attended all meetings of the Board of Supervisors and its special
+committees during their terms of office. Mr. JIA Xiangsen and Mr. ZHENG Zhiguang, led two
+special surveys on the effectiveness of comprehensive risk management and the effectiveness
+of internal control and proposed independent opinions such as strengthening the comprehensive
+risk management concept, improving the comprehensive risk management system and imposing
+stricter supervision accountability. Their contributions played an active role in promoting the
+improvement of the Bank's corporate governance and business management. During the reporting
+period, Mr. JIA Xiangsen and Mr. ZHENG Zhiguang worked at the Bank for more than 15
+working days.
+194
+On behalf of the Board of Supervisors
+ZHANG Keqiu
+Chairwoman of the Board of Supervisors
+29 March 2022
+Significant Events
+Material Litigation and Arbitration
+The Bank was involved in certain litigation and arbitration cases in the regular course of its
+business. In the Bank's regular business operations in different countries and regions across
+the world, give the range and scale of its international presence, the Bank may be involved in a
+variety of litigation, arbitration and judicial proceedings within different jurisdictions, and the
+ultimate outcomes of these proceedings involve various levels of uncertainty. Based upon the
+opinions of internal and external legal counsels, the senior management of the Bank believes
+that, at the current stage, these matters will not have a material impact on the financial position
+or operating results of the Bank. Should the ultimate outcomes of these matters differ from the
+initially estimated amounts, such differences will impact the profit or loss in the period during
+which such a determination is made.
+Purchase and Sale of Material Assets
+During the reporting period, the Bank did not undertake any purchase and sale of material assets
+that is required to be disclosed.
+Implementation of Stock Incentive Plan and Employee Stock
+Ownership Plan
+The Bank approved a long-term incentive policy, including the Management Stock Appreciation
+Rights Plan and the Employee Stock Ownership Plan, at the Board meeting and the extraordinary
+shareholders' meeting held in November 2005. To date, the Management Stock Appreciation
+Rights Plan and the Employee Stock Ownership Plan have not been implemented.
+Significant Connected Transactions
+The Bank had no significant connected transactions during the reporting period. For details of
+the related party transactions as defined by the relevant accounting standards by the end of the
+reporting period, please refer to Note V.42 of the Consolidated Financial Information.
+Major Contracts and Enforcement thereof
+Material Custody, Sub-contracts and Leases
+During the reporting period, the Bank did not take, or allow to subsist any significant custody
+of, sub-contract or lease assets from other companies, or allow its material business assets to be
+subject to such arrangements, in each case that is required to be disclosed.
+Material Guarantee Business
+As approved by PBOC and CBIRC, the Bank's guarantee business is an off-balance sheet item
+in the ordinary course of its business. The Bank operates its guarantee business in a prudent
+manner and has formulated specific management measures, operational processes and approval
+procedures in respect of the risks of guarantee business and carries out this business accordingly.
+During the reporting period, save as disclosed above, the Bank did not enter into or allow to
+subsist any material guarantee business that is required to be disclosed.
+193
+Huijin made a “non-competing commitment” when the Bank launched its IPO. As at 31
+December 2021, Huijin has strictly observed and has not breached such undertaking.
+During the reporting period, the Board of Supervisors held no objection to such matters under
+its supervision regarding the Bank's operational and legal compliance, financial position, use of
+raised funds, purchase and sale of assets, connected transactions, internal control and corporate
+information disclosure.
+Promoted improvement and progress through supervision. The Board of Supervisors followed
+up on the Bank's progress in implementing the rectification of problems identified in national
+tour inspections, national audits, various regulatory inspections and internal and external audit
+reports, urged that key issues be effectively rectified and promoted the establishment of a far-
+reaching mechanism for the rectification of common problems. It gave full play to its constructive
+supervisory role within the corporate governance system, and offered forward-looking, targeted
+and practical suggestions and supervisory opinions on operation and management to the Board
+of Directors and the Senior Management, through ways such as sending letters of supervisory
+recommendations and submitting special survey reports.
+During the reporting period, there was no misappropriation of the Bank's funds by its controlling
+shareholder or other related parties for non-operating purposes.
+Misappropriation of Funds by Controlling Shareholder and Other
+Related Parties
+During the reporting period, the Bank did not enter into or allow to subsist any other major
+contract that is required to be disclosed.
+Other Major Contracts
+In 2021, the Duty Performance and Due Diligence Supervision Committee of the Board of
+Supervisors held four on-site meetings and three meetings by written resolution, at which
+it pre-reviewed proposals regarding the evaluation opinions of the Board of Supervisors on
+the duty performance of the Board of Directors, the Senior Management and its members
+for 2020, performance evaluation results for the Chairperson of the Board of Supervisors for
+2020, implementation plan on performance management for the Chairperson of the Board of
+Supervisors in 2021, performance evaluation results and remuneration distribution plan for
+external supervisors, amendments to contents concerning the Board of Supervisors in the Articles
+of Association, amendments to the Rules of Procedure of the Board of Supervisors of Bank of
+China Limited, amendments to the Terms of References of Duty Performance and Due Diligence
+Supervision Committee of the Board of Supervisors of Bank of China Limited (Version 2021),
+formulation of the Measures for the Performance Evaluation of the Board of Directors, the Board
+of Supervisors, the Senior Management and its Members of Bank of China Limited (Trial), among
+others.
+In 2021, the Finance and Internal Control Supervision Committee of the Board of Supervisors
+held four on-site meetings and one meeting by written resolution, at which it pre-reviewed the
+proposals regarding the Bank's four regular reports, 2020 profit distribution plan, 2020 internal
+control assessment report, 2020 corporate social responsibility report, evaluation opinions of
+the Board of Supervisors on the Bank's strategy implementation in 2020, amendments to the
+Implementation Rules for the Work of the Finance and Internal Control Supervision Committee of
+the Board of Supervisors of Bank of China Limited, among others.
+Performance of Supervision and Inspection by the Board of
+Supervisors
+In 2021, with the aim of building a first-class global banking group and in compliance with
+relevant laws and regulations, regulatory requirements and the Articles of Association of the
+Bank, the Board of Supervisors aligned itself with national decisions and plans on economic
+and financial work, regulatory requirements, Bank-wide work priorities and core supervisory
+responsibilities. It diligently supervised the Bank's strategies, duty performance, financial
+management, risk management and internal control, and enhanced self-improvement as well as
+the quality and effectiveness of its supervision, thus continuously contributing to the high-quality
+development of the Bank.
+Conducted supervision with a focus on the implementation of national decisions and plans.
+The Board of Supervisors focused on enhancing the Bank's ability to serve the real economy,
+private enterprises and micro and small-sized enterprises, ensuring stability on six key fronts and
+maintaining security in six key areas and providing financial support for the implementation of
+policies and measures such as green and low-carbon economic development, high-level scientific
+and technological self-reliance, rural revitalisation and promoting common prosperity as well as
+the nation's major regional development strategies. It also paid close attention to the multiple
+measures taken by the Bank to stabilise foreign trade, serve the high-level opening-up and
+contribute to the high-quality development of the Belt and Road by leveraging its advantages in
+globalised operations. In response to the information obtained, the Board of Supervisors made
+timely reflections and issued prompts via resolutions of the Board of Supervisors, evaluation
+opinions of special supervision and quarterly supervision reports. Moreover, it conducted special
+190
+surveys on the implementation of national decisions and plans for serving the real economy, put
+forward suggestions to improve the planning system, and strengthened policy research, analysis,
+and understanding, thus urging the proper implementation of national decisions and plans by the
+Bank.
+Diligently supervised and evaluated the duty performance of directors and senior
+management members. Supervisors attended the meetings of the Board of Directors and its
+special committees, as well as meetings of the Senior Management as non-voting attendees, heard
+reports, participated in symposiums, held interviews, analysed materials and carried out special
+surveys. This allowed supervisors to stay informed and supervise the performance of the Board of
+Directors, the Senior Management and its members in the following areas: compliance with laws
+and regulations and the Articles of Association of the Bank, implementation of national economic
+and financial policies, regulatory requirements and resolutions of shareholders' general meetings
+and the Board of Directors, and progress towards improving the operation and management of
+the Bank. The Board of Supervisors completed four quarterly supervision reports on the duty
+performance of the Board of Directors and the Senior Management, and expressed supervisory
+opinions. It also carried out evaluations of duty performance, interviewing members of the
+Board of Directors and the Senior Management, and issuing annual evaluation opinions on their
+duty performance based on supervision of their routine duty performance, so as to promote the
+compliance and effective duty performance of directors and senior management members.
+Actively carried out strategy supervision. The Board of Supervisors participated in and
+supervised the research, formulation, work allocation and implementation of the Group's 14th
+Five-Year Plan and the Long-Range Objectives Through the Year 2035, to ensure that the Bank's
+strategies effectively align with the national 14th Five-Year Plan while reflecting the realities of
+its own development landscape. Focusing on building the “One Mainstay, Two Engines" strategic
+development pattern, the Board of Supervisors reinforced supervision of key strategic areas such
+as the “Eight Priority Areas". Furthermore, it regularly reviewed the strategy implementation,
+heard two related reports and issued supervision and evaluation opinions on the Bank's strategy
+implementation for 2020. By conducting special surveys on strategic management, it put forward
+recommendations such as improving the governance structure of strategic management and
+strengthening the management of strategy implementation, so as to promote the implementation
+of the Group's 14th Five-Year Plan.
+Earnestly conducted the review and supervision of financial and regular reports. The Board
+of Supervisors followed up and supervised the decision-making and implementation progress of
+major financial activities and matters such as the Bank's annual financial management priorities,
+annual business plan and financial budget. It regularly reviewed and analysed the Bank's
+financial and accounting data and strengthened its forward-looking analysis and judgement of
+the Bank's financial operations by tracking and studying of the macro-economic and financial
+situation, regulatory policies and peer dynamics. It completed four quarterly supervision reports
+on the Bank's financial position, and made prompts to take effective measures in order to improve
+the Bank's financial performance and the far-reaching mechanism for financial compliance.
+Moreover, the Board of Supervisors consolidated the review and supervision of regular reports,
+regularly heard reports on operating results and external audit results, supervised and reviewed
+the authenticity, accuracy and completeness of financial materials such as regular reports, annual
+financial report and profit distribution plan. All supervisors signed written confirmation opinions
+191
+regarding the Bank's regular reports, and put forward proposals to strengthen multi-dimensional
+comprehensive analysis, consolidate the central role of domestic commercial banks, commit
+long-term efforts to enhancing its overseas operation and management, and improve the market
+competitiveness of its comprehensive operation companies, in order to facilitate the Group's
+high-quality development.
+Deepened supervision of risk management and internal control. The Board of Supervisors
+continuously monitored the global political and economic landscape, domestic and overseas
+pandemic situation and changes in the financial market environment, as well as actively studying
+and analysing new issues faced by the Bank's risk management and internal control functions, so
+as to comprehensively understand the Bank's risk management and internal control status and its
+progress in towards the implementation of key tasks. It also monitored the Bank's fulfillment of
+risk and internal control-related regulatory indicators, and completed four quarterly supervision
+reports on risk and internal control, which provided timely risk alerts for incipient and
+tendentious issues. Emphasising key areas and key links, it intensified its focus on the supervision
+of credit risk prevention and control under the new situation, risk management and control in
+the real estate industry, interest rate and exchange rate risk management, case prevention, major
+risk screening and the establishment of emergency management mechanism and the application
+of stress test results. Furthermore, it kept a close eye on risks brought by changes in the external
+situation to cross-border and cross-industry operations, issued prompt alerts to enhance the
+management of internal control compliance and business continuity in overseas institutions,
+and strengthened the penetration management of risks in comprehensive operation companies.
+Focusing on the weak links in the comprehensive risk management and internal control system,
+it conducted special surveys on the effectiveness of the Bank's comprehensive risk management
+and internal control and put forward suggestions such as improving the comprehensive
+risk governance structure, enhancing the Bank's integrated risk management capabilities,
+consolidating the responsibilities of the internal control “three lines of defence" and strengthening
+support of internal control resources and support. In addition, it paid close attention to the
+implementation of the optimisation solutions for the comprehensive risk management system, so
+as to promote enhanced risk management with a view to better serving the development of the
+Group.
+Strengthened supervision and evaluation in specific fields. In response to regulatory
+requirements regarding key supervisory matters, the Board of Supervisors optimised its
+supervision work plan, improved its supervisory analysis framework and indicator system,
+consolidated its institutional arrangements by which functional departments report to the Board of
+Supervisors, and issued 20 supervision and evaluation opinions as required.
+Leveraged on supervision synergy. The Board of Supervisors adhered to a coordination
+mechanism between directors and supervisors under which resolutions of the Board of
+Supervisors are sent to the Board of Directors and briefings of the Board of Directors are sent
+to the Board of Supervisors. It also continued to jointly carry out activities such as surveys,
+interviews and training with directors, and reinforced communication and coordination with the
+Board of Directors and the Senior Management, so as to leverage the governance synergy. In
+addition, it also deepened cooperation with the internal audit and supervised the work quality
+of the new external auditors. Moreover, the Board of Supervisors enhanced the coordination
+with the second and third lines of defence and the comprehensive management departments,
+and conducted communication and exchanges with major peers, thus broadening its supervision
+horizon and improving its supervision efficiency.
+192
+Strengthened self-improvement. The Board of Supervisors improved its policy system by
+revising items concerning the Board of Supervisors in the Articles of Association of the Bank,
+formulating the Measures for the Performance Evaluation of the Board of Directors, the Board
+of Supervisors, the Senior Management and its Members (Trial), and improving the Rules of
+Procedure of the Board of Supervisors, the Terms of References of Duty Performance and
+Due Diligence Supervision Committee of the Board of Supervisors and the Implementation
+Rules for the Work of the Finance and Internal Control Supervision Committee of the Board
+of Supervisors. Furthermore, it strengthened the supervisory team building and, in accordance
+with the laws, regulations and corporate governance procedures, completed the replacement of
+the Chairperson of the Board of Supervisors, the resignation of two employee supervisors, the
+appointment of two employee supervisors and the re-appointment of one employee supervisor,
+and undertook the selection and appointment of external supervisors. To enhance professional
+competency of supervisors, special training was held for the Board of Supervisors regarding the
+opportunities and challenges arising from the globalisation of commercial banks as well as the
+"carbon neutrality” risk management practices of financial institutions. The Board of Supervisors
+also urged supervisors to perform their duties and responsibilities and completed the annual duty
+performance evaluation of the Board of Supervisors and its members. All supervisors performed
+their supervision duties faithfully and diligently, and made efforts to improve their policy level
+and ability to perform their duties. Besides, they actively attended meetings, earnestly examined
+proposals, listened to work reports, carried out special surveys, and provided professional, well-
+considered and independent suggestions.
+The Board of Directors and the Senior Management attached great importance and gave strong
+support to the work of the Board of Supervisors. By holding Executive Committee meetings
+and special meetings, issuing written instructions and through other means, they required senior
+management members and relevant functional departments to carefully study the opinions and
+suggestions offered by the Board of Supervisors, and push forward the effective transmission,
+implementation and application of the supervisory results of the Board of Supervisors across
+the Bank. Effective interaction among the Board of Directors, the Board of Supervisors and the
+Senior Management boosted the continuous enhancement of the Bank's corporate governance.
+During the reporting period, there is no violation of laws, administrative regulations or rules of
+CSRC in the Bank's guarantee business.
+195
+bias.
+We assessed the design and tested the operating
+effectiveness of the key internal controls over the
+measurement of ECL for loans and advances to
+customers. These included periodic assessment
+and approval controls, which primarily include:
+(1)
+(2)
+internal controls over the ECL model
+management, including continuous
+monitoring of the selection of modelling
+methodologies, model optimisation,
+approval and application of changes in key
+parameters, and model back-testing;
+We understood and evaluated management's
+internal controls and assessment process for the
+measurement of ECL for loans and advances
+to customers. We assessed the inherent risk of
+material misstatement by considering the degree
+of estimation uncertainty and level of other
+inherent risk factors such as the complexity
+of estimation models used, the subjectivity
+of significant management judgements and
+assumptions, and susceptibility to management
+measurement.
+internal controls over the estimated future
+cash flows and calculation of present
+value with respect to loans and advances
+to customers classified as stage 3 with
+individual amount that are relatively
+significant;
+internal controls over the accuracy and
+completeness of key data used by the
+models;
+internal controls over the information
+technology (“IT”) systems for ECL
+measurement, including information
+technology general controls ("ITGCs"),
+data interfaces, application of model
+parameters and automated IT controls over
+impairment calculations.
+We involved our credit risk experts in evaluating
+the model methodologies, significant judgements
+and assumptions, data and key parameters used
+in the ECL measurement for loans and advances
+to customers. The substantive audit procedures
+performed by us were mainly as follows:
+(1)
+we assessed the appropriateness of portfolio
+segmentation and the models adopted
+for the measurement of ECL in respect
+of different portfolios with consideration
+given to the risk characteristics of loans
+and advances to customers, the Group's
+risk management practices and industry
+practices. We selected samples of ECL
+calculations and examined whether the
+models' calculation engines are consistent
+with the Group's methodologies.
+200
+Independent Auditor's Report (Continued)
+How our audit addressed the Key Audit Matter
+Key Audit Matter
+Measurement of expected credit loss ("ECL") for loans and advances to customers (Continued)
+(2)
+(3)
+(4)
+we examined the accuracy and
+completeness of historical and measurement
+date data used in the ECL models on a
+sampling basis, including:
+(i)
+(ii)
+in respect of PD: financial and non-
+financial information for determining
+borrowers' credit rating, overdue
+repayment status, etc.;
+Key Audit Matters (Continued)
+We have identified the measurement of ECL for loans
+and advances to customers as a key audit matter due
+to the material balance of the Group's loss allowances
+for loans and advances to customers and high inherent
+risk given the uncertainty of estimates, adoption
+of complex models, involvement of significant
+management judgements and assumptions and use
+of numerous parameters and data inputs in such
+Estimation of future cash flows for stage
+3 loans and advances to customers
+individual amount that
+significant.
+are
+Based on the procedures performed, we
+considered that the judgements and assumptions
+used by management in valuing financial
+investments measured at fair value were
+supported by the available evidence.
+Independent Auditor's Report (Continued)
+Key Audit Matters (Continued)
+Key Audit Matter
+How our audit addressed the Key Audit Matter
+Measurement of expected credit loss ("ECL") for loans and advances to customers (Continued)
+The measurement of ECL for loans and advances
+to customers involves significant management
+judgements and assumptions, mainly on:
+(1) Segmentation of portfolios based on credit risk
+characteristics, selection of appropriate models
+and determination of relevant key parameters;
+(3)
+relatively
+(4)
+Determination and application of criteria to
+identify significant increase in credit risks and
+default or credit-impaired assets;
+(5)
+(3)
+Economic indicators, economic
+scenarios
+(4)
+and weightings used in the forward-looking
+measurement;
+with
+(2)
+of
+(iii) in respect of EAD: borrowers'
+outstanding loan balances, interest
+rates, maturity dates, repayment
+methods, etc. by agreeing them to
+loan contracts and other relevant
+documents. We also agreed the total
+credit risk exposure in the ECL
+models to data from other information
+systems.
+in respect of PD and LGD, we assessed
+the reasonableness of the parameters by
+comparing the historical expected default
+and loss given default with the subsequent
+actual default and loss given default for
+significant exposures through independent
+back-testing.
+to
+We assessed the design and tested the operating
+effectiveness of the key internal controls over
+the valuation of financial investments measured
+at fair value. These included controls over
+independent price verification, model validation
+and approval, review and approval of valuation
+results, and the information technology general
+controls ("ITGCs") of related systems, systems
+interfaces of inputs such as market data and
+automated calculations within the valuation
+system.
+(1)
+for Level 1 financial investments, we tested
+their valuations by comparing to quoted
+prices in active markets.
+203
+Independent Auditor's Report (Continued)
+Key Audit Matters (Continued)
+Key Audit Matter
+How our audit addressed the Key Audit Matter
+We understood and evaluated management's
+internal controls and assessment process over
+the valuation of financial investments measured
+at fair value. We assessed the inherent risk of
+material misstatement by considering the inherent
+risk factors of the different fair value levels
+such as the degree of estimation uncertainty, the
+complexity of valuation techniques and models,
+the subjectivity of management's judgements and
+assumptions in selecting valuation techniques,
+models and inputs and susceptibility
+management bias.
+Valuation of financial investments measured at fair value (Continued)
+for Level 2 and Level 3 financial
+investments:
+(i)
+(ii)
+we assessed the appropriateness of
+the Group's valuation models and
+benchmarked against common market
+models, taking into consideration the
+product characteristics and industry
+practice;
+for inputs used for valuation of Level
+2 financial investments, we tested the
+accuracy of inputs to the valuation
+model by comparing to market
+observable data;
+(iii) for unobservable inputs used for
+the valuation of Level 3 financial
+investments, we obtained an
+understanding of management's
+methodology for the selection of
+inputs such as liquidity discounts,
+discount rates, expected dividend,
+etc. and assessed the reasonableness
+and appropriateness of such inputs
+by examining supporting information
+and comparing to alternatives in
+the market with involvement of our
+internal valuation experts. We also
+performed sensitivity analysis on the
+unobservable inputs;
+(iv)
+we engaged internal valuation experts
+to perform independent valuation
+testing.
+We checked and evaluated the financial statement
+disclosures in relation to the fair value of
+financial investments.
+(2)
+in respect of LGD: types
+guarantees and collateral, historical
+actual loss rates, etc.;
+How our audit addressed the Key Audit Matter
+As at 31 December 2021, financial investments
+measured at fair value through profit or loss and
+financial investments measured at fair value through
+other comprehensive income of the Group were
+RMB561,642 million and RMB2,389,830 million
+respectively, representing 11.04% of total assets. Of
+these financial investments measured at fair value,
+(1) financial investments classified as Level 1 fair
+value, measured using quoted prices (unadjusted) in
+active markets accounted for 15.47%; (2) financial
+investments classified as Level 2 fair value, measured
+using valuation techniques for which inputs are
+observable for the financial investments, accounted
+for 79.24%; (3) financial investments classified
+as Level 3 fair value, measured using valuation
+techniques using unobservable inputs that have a
+significant impact on the valuation accounted for
+5.29%. Level 3 financial investments mainly include
+unlisted equity and fund investments held by the
+Group.
+we selected samples and assessed the
+appropriateness of management's staging
+classifications and judgements used in
+determining significant increases in credit
+risk and identification of default or credit-
+impaired assets based on the borrower's
+financial and non-financial information
+and other external evidence provided by
+management. We took into consideration
+the credit risk profile of borrowers and the
+Group's risk management practices in such
+assessment.
+201
+Independent Auditor's Report (Continued)
+Key Audit Matters (Continued)
+Key Audit Matter
+How our audit addressed the Key Audit Matter
+Measurement of expected credit loss ("ECL") for loans and advances to customers (Continued)
+(5)
+We have identified this as a key audit matter due
+to the material balance of the financial investments
+measured at fair value and significant management
+judgement and assumptions are required, including
+selection and determination of unobservable inputs, in
+valuing the financial investments in Level 3.
+for forward-looking measurements,
+we evaluated management's selection
+methodology for economic indicators,
+economic scenarios and weightings
+assigned based on statistical analysis
+and expert judgements. We assessed the
+reasonableness of the forecasted economic
+indicators by performing back-testing and
+comparing with publicly available forecasts
+from third-party institutions. We performed
+sensitivity analysis on the economic
+indicators and weightings under different
+economic scenarios.
+(6)
+for individual loans and advances to
+customers classified as stage 3 which were
+relatively significant, we examined on a
+sample basis, the forecasted cash flows
+prepared by management based on the
+financial information of borrowers and
+guarantors, latest collateral valuations and
+other available information and factors
+together with discount rates used to support
+the computation of loss allowances.
+We checked and evaluated the financial statement
+disclosures in relation to the measurement of
+ECL.
+Based on procedures performed, we considered
+that the models, significant judgements and
+assumptions, as well as relevant data and
+parameters used by management in measuring
+ECL for loans and advances to customers were
+supported by the available evidence.
+Independent Auditor's Report (Continued)
+Key Audit Matters (Continued)
+Key Audit Matter
+Valuation of financial investments measured at fair value
+Refer to Note II, 4.4, Note III, 2, Note V, 18 and Note
+VI, 5.1 of the consolidated financial statements.
+202
+204
+We performed the following substantive
+procedures over the valuation of financial
+investments measured at fair value, on a sample
+basis:
+322
+Conclude on the appropriateness of the directors' use of the going concern basis of
+accounting and, based on the audit evidence obtained, whether a material uncertainty
+exists related to events or conditions that may cast significant doubt on the Group's
+ability to continue as a going concern. If we conclude that a material uncertainty exists,
+we are required to draw attention in our auditor's report to the related disclosures in the
+consolidated financial statements or, if such disclosures are inadequate, to modify our
+opinion. Our conclusions are based on the audit evidence obtained up to the date of our
+auditor's report. However, future events or conditions may cause the Group to cease to
+continue as a going concern.
+•
+•
+Auditor's Responsibilities for the Audit of the Consolidated Financial Statements
+(Continued)
+Independent Auditor's Report (Continued)
+207
+Evaluate the appropriateness of accounting policies used and the reasonableness of
+accounting estimates and related disclosures made by the directors.
+Obtain an understanding of internal control relevant to the audit in order to design audit
+procedures that are appropriate in the circumstances, but not for the purpose of expressing
+an opinion on the effectiveness of the Group's internal control.
+Identify and assess the risks of material misstatement of the consolidated financial
+statements, whether due to fraud or error, design and perform audit procedures responsive
+to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis
+for our opinion. The risk of not detecting a material misstatement resulting from fraud is
+higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
+omissions, misrepresentations, or the override of internal control.
+.
+•
+•
+As part of an audit in accordance with ISAs, we exercise professional judgement and maintain
+professional scepticism throughout the audit. We also:
+Our objectives are to obtain reasonable assurance about whether the consolidated financial
+statements as a whole are free from material misstatement, whether due to fraud or error, and
+to issue an auditor's report that includes our opinion. We report our opinion solely to you, as a
+body, and for no other purpose. We do not assume responsibility towards or accept liability to any
+other person for the contents of this report. Reasonable assurance is a high level of assurance, but
+is not a guarantee that an audit conducted in accordance with ISAs will always detect a material
+misstatement when it exists. Misstatements can arise from fraud or error and are considered
+material if, individually or in the aggregate, they could reasonably be expected to influence the
+economic decisions of users taken on the basis of these consolidated financial statements.
+Auditor's Responsibilities for the Audit of the Consolidated Financial Statements
+Evaluate the overall presentation, structure and content of the consolidated financial
+statements, including the disclosures, and whether the consolidated financial statements
+represent the underlying transactions and events in a manner that achieves fair presentation.
+Obtain sufficient appropriate audit evidence regarding the financial information of the
+entities or business activities within the Group to express an opinion on the consolidated
+financial statements. We are responsible for the direction, supervision and performance of
+the group audit. We remain solely responsible for our audit opinion.
+We communicate with those charged with governance regarding, among other matters, the
+planned scope and timing of the audit and significant audit findings, including any significant
+deficiencies in internal control that we identify during our audit.
+We also provide those charged with governance with a statement that we have complied with
+relevant ethical requirements regarding independence, and to communicate with them all
+relationships and other matters that may reasonably be thought to bear on our independence, and
+where applicable, actions taken to eliminate threats or safeguards applied.
+. 217
+215
+213
+212
+CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME.
+CONSOLIDATED STATEMENT OF FINANCIAL POSITION
+CONSOLIDATED STATEMENT OF CHANGES IN EQUITY.
+CONSOLIDATED STATEMENT OF CASH FLOWS ..
+211
+CONSOLIDATED INCOME STATEMENT.
+Those charged with governance are responsible for overseeing the Group's financial reporting
+process.
+CONSOLIDATED FINANCIAL STATEMENTS
+Consolidated Financial Statements
+208
+Hong Kong, 29 March 2022
+Certified Public Accountants
+PricewaterhouseCoopers
+The engagement partner on the audit resulting in this independent auditor's report is Ho Shuk
+Ching, Margarita.
+From the matters communicated with those charged with governance, we determine those matters
+that were of most significance in the audit of the consolidated financial statements of the current
+period and are therefore the key audit matters. We describe these matters in our auditor's report
+unless law or regulation precludes public disclosure about the matter or when, in extremely rare
+circumstances, we determine that a matter should not be communicated in our report because the
+adverse consequences of doing so would reasonably be expected to outweigh the public interest
+benefits of such communication.
+CONTENTS
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+I. GENERAL INFORMATION AND PRINCIPAL ACTIVITIES
+II. SUMMARY OF PRINCIPAL ACCOUNTING POLICIES
+III. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS IN
+APPLYING ACCOUNTING POLICIES.
+In preparing the consolidated financial statements, the directors are responsible for assessing the
+Group's ability to continue as a going concern, disclosing, as applicable, matters related to going
+concern and using the going concern basis of accounting unless the directors either intend to
+liquidate the Group or to cease operations, or have no realistic alternative but to do so.
+Responsibilities of Directors and Those Charged with Governance for the Consolidated
+Financial Statements
+(2)
+(1)
+performed the following substantive
+procedures on a sample basis:
+We
+We assessed and tested the design and operating
+effectiveness of the key internal controls over
+the Group's consolidation of structured entities.
+These included controls over management's
+assessment of the transaction structures and
+contractual terms, calculations of variable
+returns, as well as review and approval of the
+consolidation assessments.
+How our audit addressed the Key Audit Matter
+We have identified this as a key audit matter due
+to the material balance of structured entities and
+significant judgements were involved in assessing the
+Group's control over the structured entities.
+The Group determines whether to consolidate
+structured entities based on management's assessment
+of the Group's control over the structured entities,
+taking into consideration its power over the structured
+entities, its exposure or rights to variable returns from
+its involvement with the structured entities, and its
+ability to use its power to affect the amount of returns
+from the structured entities.
+The Group is principally involved with structured
+entities through sponsoring, managing and/or
+investing in wealth management products, asset
+securitisation products, funds, investment trust
+plans and asset management plans in Chinese
+Mainland. As at 31 December 2021, the Group's
+interests in unconsolidated structured entities
+mainly included (1) the balance of unconsolidated
+wealth management products and publicly offered
+funds/asset management plans sponsored by the
+Group amounted to RMB1,710,750 million and
+RMB487,438 million, respectively; (2) the balances
+of interest in unconsolidated structured entities held
+by the Group through direct investments in fund
+investments, investment trusts and asset management
+plans, and asset-backed securitisations sponsored by
+other financial institutions were RMB68,914 million,
+RMB12,268 million, and RMB125,081 million,
+respectively.
+Refer to Note II, 2.1, Note III, 7 and Note V, 45 of
+the consolidated financial statements.
+Consolidation of structured entities
+Key Audit Matter
+209
+Key Audit Matters (Continued)
+Independent Auditor's Report (Continued)
+we inspected the contractual terms of
+structured entities, understood the purpose
+of establishment, examined the transaction
+structure and identified the decision-making
+mechanism of related activities to assess
+the rights and obligations of the Group
+and other investors, as well as the Group's
+power over the structured entities.
+we examined the arrangements for
+investment income, fee income, assets
+management fees and retained residual
+income from the structured entities
+based on the contractual terms including
+whether liquidity support or other
+arrangements were provided by the Group
+to the structured entities, and performed
+independent analysis and testing to assess
+the Group's exposure or rights to variable
+returns from its involvement in related
+activities with the structured entities.
+205
+Independent Auditor's Report (Continued)
+Independent Auditor's Report (Continued)
+206
+If, based on the work we have performed, we conclude that there is a material misstatement
+of this other information, we are required to report that fact. We have nothing to report in this
+regard.
+In connection with our audit of the consolidated financial statements, our responsibility is to
+read the other information and, in doing so, consider whether the other information is materially
+inconsistent with the consolidated financial statements or our knowledge obtained in the audit or
+otherwise appears to be materially misstated.
+Our opinion on the consolidated financial statements does not cover the other information and we
+do not express any form of assurance conclusion thereon.
+The directors of the Bank are responsible for the other information. The other information
+comprises all of the information included in the annual report other than the consolidated
+financial statements and our auditor's report thereon.
+Other Information
+The directors of the Bank are responsible for the preparation of the consolidated financial
+statements that give a true and fair view in accordance with IFRSS and the disclosure
+requirements of the Hong Kong Companies Ordinance, and for such internal control as the
+directors determine is necessary to enable the preparation of consolidated financial statements
+that are free from material misstatement, whether due to fraud or error.
+performed, we
+We checked and assessed the financial statement
+disclosures in relation to the consolidation of
+structured entities.
+we analysed the extent of the Group's
+decision-making power, the level of returns
+and the risk of variable returns due to
+holding other interests in the structured
+entities to assess whether the Group has
+the ability to use their power to influence
+the amount of returns from the structured
+entities. We also analysed the substantive
+rights held by other investors to assess
+whether the Group acted as a principal
+or an agent in structured entities related
+transactions.
+(3)
+How our audit addressed the Key Audit Matter
+Consolidation of structured entities (Continued)
+Key Audit Matter
+Key Audit Matters (Continued)
+Based on the procedures
+219
+considered that management's judgements on
+the consolidation of structured entities were
+supported by the available evidence.
+24. Due to banks and other financial institutions.
+296
+290
+21. Investment properties.
+20. Property and equipment.
+19. Investment in associates and joint ventures.
+18. Financial investments.
+29. Due to customers
+17. Loans and advances to customers
+279
+16. Derivative financial instruments and hedge accounting.
+278
+15. Placements with and loans to banks and other financial institutions.
+277
+320
+14.
+305
+276
+306
+22. Other assets
+220
+30. Bonds issued
+319
+28. Financial liabilities held for trading.
+318
+27. Placements from banks and other financial institutions.
+318
+Government certificates of indebtedness for bank notes issued
+and bank notes in circulation. .
+26.
+317
+25. Due to central banks
+317
+315
+23. Impairment allowance
+310
+309
+274
+Balances with central banks. . . .
+13. Cash and due from banks and other financial institutions
+6.
+273
+5.
+Net gains on transfers of financial asset
+4.
+Net trading gains
+3.
+Net fee and commission income
+2.
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+1. Net interest income
+V.
+IV. TAXATION
+....
+260
+257
+Operating expenses
+7.
+Other operating income
+8.
+11. Earnings per share (basic and diluted).
+12. Other comprehensive income. . .
+271
+270
+266
+265
+Staff costs
+263
+263
+264
+262
+261
+10. Income tax expense
+Impairment losses on assets.
+9.
+Directors', supervisors' and senior management's emoluments
+262
+placements with and loans to banks and
+Net decrease/(increase) in due from and
+other financial institutions
+111,715
+(206,736)
+Net increase in precious metals
+(52,983)
+(17,061)
+Net increase in due to central banks
+to customers
+(1,564,704)
+(1,204,492)
+Net decrease/(increase) in other assets
+126,476
+(4,050)
+Net increase in due to banks
+and other financial institutions
+762,120
+250,181
+47,092
+Net increase in loans and advances
+(2,710)
+151,183
+829
+(1,246)
+67,240
+Net gains on disposals of investments in
+subsidiaries, associates and joint ventures
+(992)
+(202)
+Share of results of associates and joint ventures
+Interest income arising from
+(1,478)
+(158)
+financial investments
+(153,859)
+central banks
+(150,553)
+(616)
+(507)
+(1,755)
+(8,486)
+Interest expense arising from bonds issued
+Accreted interest on impaired loans
+41,836
+35,719
+(728)
+(1,236)
+Interest expense arising from lease liabilities
+Net changes in operating assets and liabilities:
+Net (increase)/decrease in balances with
+742
+Dividends arising from investment securities
+Net gains on financial investments
+43,963
+other long-term assets
+banks and other financial institutions
+Year ended 31 December
+Note
+2021
+2020
+Proceeds from disposals of property and
+equipment, intangible assets and
+7,781
+4,087
+Proceeds from disposals of investments in
+subsidiaries, associates and joint ventures
+1,620
+1,085
+Dividends received
+1,288
+909
+Interest income received from
+financial investments
+Proceeds from disposals/maturities of
+financial investments
+152,114
+(781)
+Cash flows from investing activities
+For the year ended 31 December 2021 (Amount in millions of Renminbi, unless otherwise stated)
+CONSOLIDATED STATEMENT OF CASH FLOWS (Continued)
+BANK OF CHINA LIMITED
+(4,006)
+(226,873)
+Net increase in due to customers
+1,226,797
+1,043,998
+Net increase/(decrease) in other borrowings
+320
+(1,977)
+Net (decrease)/increase in other liabilities
+(62,752)
+Net decrease in placements from
+140,613
+899,514
+131,718
+(56,256)
+(58,690)
+Net cash inflow from
+operating activities
+843,258
+73,028
+The accompanying notes form an integral part of these consolidated financial statements.
+217
+Cash inflow from operating activities
+Income tax paid
+other long-term assets
+V.38.2
+5,065
+V.38.1
+Appropriation to general and regulatory reserves
+Dividends
+Net change in treasury shares
+Capital contribution by non-controlling shareholders
+Capital contribution and reduction by
+other equity instruments holders
+Other comprehensive income transferred to
+retained earnings
+Other
+Appropriation to statutory reserves
+As at 31 December 2020
+199,893
+136,012
+19,613
+174,762
+250,100
+776,940
+77,597
+(37)
+(15,446)
+142
+294,388
+124,995
+V.12
+Total
+CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Continued)
+For the year ended 31 December 2021 (Amount in millions of Renminbi, unless otherwise stated)
+3,105,057
+As at 1 January 2020
+Attributable to equity holders of the Bank
+Other
+General and
+Non-
+Other equity
+comprehensive
+Statutory
+Total comprehensive income
+regulatory Undistributed
+controlling
+Note
+Share capital
+instruments Capital reserve
+income
+reserves
+reserves
+profits
+shares
+interests
+Treasury
+Net gains on disposals of property and
+equipment, intangible assets and
+1,976,696
+4,810
+The accompanying notes form an integral part of these consolidated financial statements.
+BANK OF CHINA LIMITED
+CONSOLIDATED STATEMENT OF CASH FLOWS
+For the year ended 31 December 2021 (Amount in millions of Renminbi, unless otherwise stated)
+Year ended 31 December
+Note
+2021
+2020
+Cash flows from operating activities
+Profit before income tax
+276,620
+2,162,837
+246,378
+Impairment losses on assets
+104,220
+119,016
+Depreciation of property and equipment and
+right-of-use assets
+22,428
+22,441
+Amortisation of intangible assets and
+other assets
+6,364
+Adjustments:
+192,870
+124,418
+864,848
+182,234
+18,676
+(18,676)
+17,881
+(17,881)
+(68,257)
+(6,982)
+(75,239)
+(1)
+1,358
+(8)
+1,358
+(6)
+77,560
+237
+229
+294,388
+277,490
+135,973
+4,309
+193,438
+267,981
+(142)
+3,302,506
+Net cash inflow from financing activities
+associates and joint ventures
+VI. FINANCIAL RISK MANAGEMENT
+373
+49. Events after the financial reporting date
+372
+368
+47. The Bank's statement of financial position and changes in equity
+48. IBOR Reform..
+366
+46. Offsetting financial assets and financial liabilities.
+363
+45. Interests in structured entities
+361
+44. Transfers of financial assets. .
+355
+346
+43. Segment reporting
+42. Related party transactions
+346
+41. Note to the consolidated statement of cash flows
+342
+40. Contingent liabilities and commitments.
+341
+1.
+Overview
+2.
+Credit risk
+435
+CONSOLIDATED FINANCIAL STATEMENTS.
+DIFFERENCES BETWEEN IFRS AND CAS
+I.
+SUPPLEMENTARY INFORMATION
+434
+431
+423
+416
+406
+339
+375
+Insurance risk.
+7.
+Capital management.
+6.
+Fair value..
+5.
+Liquidity risk
+4.
+Market risk.
+3.
+374
+38. Statutory reserves, general and regulatory reserves and undistributed profits.
+39. Non-controlling interests
+334
+37. Share capital, capital reserve and other equity instruments
+1,494,868
+1,345,892
+Cash and cash equivalents at end of year
+V.41
+1,975,631
+1,494,868
+The accompanying notes form an integral part of these consolidated financial statements.
+218
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Cash and cash equivalents at beginning of year
+FOR THE YEAR ENDED 31 DECEMBER 2021
+I
+GENERAL INFORMATION AND PRINCIPAL ACTIVITIES
+Bank of China Limited (the “Bank”), formerly known as Bank of China, a State-owned
+joint stock commercial bank, was founded on 5 February 1912. From its formation until
+1949, the Bank performed various functions of a central bank, foreign exchange bank and
+commercial bank specialising in trade finance. After 1949, the Bank was designated as the
+state-designated specialised foreign exchange and trade bank. Since 1994, the Bank has
+evolved into a State-owned commercial bank. In this regard, in accordance with the Master
+Implementation Plan for the Joint Stock Reform approved by the State Council of the PRC,
+the Bank was converted into a joint stock commercial bank on 26 August 2004 and its name
+was changed from Bank of China to Bank of China Limited. In 2006, the Bank listed on the
+Stock Exchange of Hong Kong Limited and the Shanghai Stock Exchange.
+The Bank is licensed as a financial institution by the China Banking and Insurance
+Regulatory Commission (the “CBIRC”) No. B0003H111000001 and is issued the business
+license of legal enterprise with unified social credit code No. 911000001000013428 by the
+State Administration of Industry and Commerce of the PRC. The registered address is No.1,
+Fuxingmen Nei Dajie, Beijing, China.
+The Bank and its subsidiaries (together the "Group") provide a full range of corporate
+banking, personal banking, treasury operations, investment banking, insurance and other
+services to its customers in the Chinese mainland, Hong Kong (China), Macao (China),
+Taiwan (China) and other major international financial centres.
+The Bank's principal regulator is the CBIRC. The operations in Hong Kong (China), Macao
+(China), Taiwan (China) and other countries and regions of the Group are subject to the
+supervision of local regulators.
+The parent company is Central Huijin Investment Limited (“Huijin”), a wholly owned
+subsidiary of China Investment Corporation ("CIC").
+These consolidated financial statements have been approved by the Board of Directors on 29
+March 2022.
+219
+BANK OF CHINA LIMITED
+(Amount in millions of Renminbi, unless otherwise stated)
+II.
+148,976
+Net increase in cash and cash equivalents
+331
+328
+327
+326
+326
+325
+36. Other liabilities
+Deferred income taxes
+35.
+34. Share appreciation rights plan
+480,763
+33. Retirement benefit obligations.
+31. Other borrowings..
+CONTENTS (Continued)
+Other net cash flows from financing activities
+(4,260)
+(6,609)
+74,344
+126,617
+Effect of exchange rate changes on cash and
+cash equivalents
+(41,278)
+(33,603)
+32. Current tax liabilities
+UNAUDITED SUPPLEMENTARY INFORMATION
+1.
+Liquidity ratios, liquidity coverage ratio and net stable funding ratio.
+(984,337)
+Cash payments for interest on bonds issued
+(22,879)
+(23,756)
+Repayments of other equity instruments issued
+(28,000)
+(32,000)
+Dividend payments to ordinary shareholders
+(57,994)
+Dividend and interest payments to
+(869,059)
+other equity instrument holders
+(9,720)
+Dividend payments to
+non-controlling shareholders
+(6,558)
+(6,982)
+Other operating income
+9,547
+3,197
+V.4
+Net gains on transfers of financial asset
+(12,230)
+8,055
+Repayments of debts issued
+41
+(2,240)
+(12,655)
+Purchase of property and equipment,
+intangible assets and other long-term assets
+(30,173)
+(39,622)
+Purchase of financial investments
+(3,630,077)
+(3,425,490)
+Net cash outflow from investing activities
+1,358
+(395,561)
+Cash flows from financing activities
+Proceeds from issuance of bonds
+1,005,299
+1,135,331
+Proceeds from issuance of
+other equity instruments
+69,984
+109,560
+Proceeds from capital contribution by
+non-controlling shareholders
+(17,066)
+Increase in investments in subsidiaries,
+28,291
+Net trading gains
+CONSOLIDATED INCOME STATEMENT
+BANK OF CHINA LIMITED
+210
+451
+commercial banks for 2020 ...
+450
+Global systemic importance assessment indicators of commercial banks
+Domestic systemic importance assessment indicators of
+7.
+6.
+448
+For the year ended 31 December 2021 (Amount in millions of Renminbi, unless otherwise stated)
+Leverage ratio
+447
+Overdue assets.
+4.
+445
+International claims
+3.
+444
+Currency concentrations.
+2.
+435
+5.
+V.3
+Year ended 31 December
+2021
+75,522
+81,426
+Net fee and commission income
+(13,118)
+(13,027)
+V.2
+Fee and commission expense
+88,640
+94,453
+V.2
+Note
+Fee and commission income
+425,142
+Net interest income
+(344,152)
+(364,346)
+760,070
+789,488
+V.1
+V.1
+Interest expense
+Interest income
+2020
+415,918
+216
+(56,228)
+2,350,553
+223,313
+Derivative financial assets
+V.16
+95,799
+171,738
+Loans and advances to customers, net
+V.17
+15,322,484
+13,848,304
+Financial investments
+V.18
+6,164,671
+5,591,117
+- financial assets at fair value through
+profit or loss
+561,642
+504,549
+- financial assets at fair value through
+other comprehensive income
+2,389,830
+2,107,790
+276,258
+Precious metals
+168,608
+175,715
+CONSOLIDATED STATEMENT OF FINANCIAL POSITION
+As at 31 December 2021 (Amount in millions of Renminbi, unless otherwise stated)
+ASSETS
+Cash and due from banks and
+Note
+As at 31 December
+2021
+2020
+other financial institutions
+V.13
+644,816
+- financial assets at amortised cost
+Balances with central banks
+2,228,726
+803,145
+2,076,840
+Placements with and loans to banks and
+other financial institutions
+V.15
+1,257,413
+939,320
+Government certificates of indebtedness for
+bank notes issued
+V.26
+V.14
+3,213,199
+2,978,778
+Investments in associates and joint ventures
+Note
+As at 31 December
+2021
+2020
+LIABILITIES
+Due to banks and other financial institutions
+V.24
+2,682,739
+1,917,003
+Due to central banks
+V.25
+CONSOLIDATED STATEMENT OF FINANCIAL POSITION (Continued)
+As at 31 December 2021 (Amount in millions of Renminbi, unless otherwise stated)
+955,557
+Bank notes in circulation
+V.26
+175,605
+168,751
+Placements from banks and
+other financial institutions
+V.27
+407,767
+411,949
+Financial liabilities held for trading
+887,811
+BANK OF CHINA LIMITED
+BANK OF CHINA LIMITED
+The accompanying notes form an integral part of these consolidated financial statements.
+V.19
+35,769
+33,508
+Property and equipment
+V.20
+246,091
+248,589
+Investment properties
+V.21
+19,554
+213
+22,065
+V.35
+51,172
+58,916
+Other assets
+V.22
+203,940
+217,196
+Total assets
+26,722,408
+24,402,659
+Deferred income tax assets
+212
+The accompanying notes form an integral part of these consolidated financial statements.
+182,234
+other comprehensive income
+- Allowance for credit losses on debt instruments
+measured at fair value through
+(2,976)
+5,444
+other comprehensive income
+- Changes in fair value on debt instruments
+measured at fair value through
+―
+(540)
+150
+10
+571
+83
+150
+101
+(83)
+V.12
+205,096
+227,339
+2020
+2021
+Note
+Year ended 31 December
+(651)
+Items that may be reclassified to profit or loss
+3,084
+associates and joint ventures accounted for
+Equity holders of the Bank
+213,615
+177,424
+Total comprehensive income attributable to:
+182,234
+221,103
+Total comprehensive income for the year
+(22,862)
+(6,236)
+Other comprehensive income for the year, net of tax
+Share of other comprehensive income of
+(22,322)
+Subtotal
+(751)
+351
+Other
+(21,549)
+(12,760)
+- Exchange differences from the translation of
+foreign operations
+(130)
+8
+using the equity method
+(6,386)
+V.28
+Subtotal
+other comprehensive income
+Attributable to:
+205,096
+227,339
+Profit for the year
+(41,282)
+(49,281)
+V.10
+Income tax expense
+246,378
+276,620
+Equity holders of the Bank
+Profit before income tax
+1,478
+V.19
+Share of results of associates and joint ventures
+246,220
+275,142
+Operating profit
+Non-controlling interests
+7,488
+4,810
+221,103
+158
+Other
+Non-controlling interests
+- Basic
+- Changes in fair value on equity instruments
+designated at fair value through
+Items that will not be reclassified to profit or loss
+Actuarial (losses)/gains on defined benefit plans
+Other comprehensive income:
+Profit for the year
+For the year ended 31 December 2021 (Amount in millions of Renminbi, unless otherwise stated)
+CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
+BANK OF CHINA LIMITED
+211
+The accompanying notes form an integral part of these consolidated financial statements.
+For details of the dividends paid or proposed, please refer to Note V.38.3.
+Earnings per share (in RMB)
+0.61
+0.61
+0.70
+V.11
+205,096
+227,339
+12,226
+10,780
+192,870
+216,559
+- Diluted
+0.70
+12,458
+The accompanying notes form an integral part of these consolidated financial statements.
+215
+26,722,408
+24,402,659
+Approved and authorised for issue by the Board of Directors on 29 March 2022.
+The accompanying notes form an integral part of these consolidated financial statements.
+LIU Liange
+Director
+LIU Jin
+Director
+214
+BANK OF CHINA LIMITED
+CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
+For the year ended 31 December 2021 (Amount in millions of Renminbi, unless otherwise stated)
+As at 1 January 2021
+Attributable to equity holders of the Bank
+Other
+General and
+Non-
+Other equity
+comprehensive
+Statutory
+Total equity and liabilities
+regulatory Undistributed
+2,162,837
+Total equity
+V.12
+1,417
+4,309
+Statutory reserves
+V.38.1
+213,930
+193,438
+General and regulatory reserves
+V.38.2
+303,209
+267,981
+Undistributed profits
+956,987
+864,848
+2,038,419
+Non-controlling interests
+V.39
+125,400
+124,418
+2,350,553
+Treasury
+controlling
+Note
+V.38.2
+Dividends
+V.38.3
+Net change in treasury shares
+Capital contribution by non-controlling shareholders
+Capital contribution and reduction by
+8
+8
+41
+41
+41,984
+(52)
+(3)
+11
+(217)
+294,388
+319,505
+135,717
+1,417
+213,930
+Appropriation to general and regulatory reserves
+V.38.1
+Appropriation to statutory reserves
+V.12
+Share capital
+instruments Capital reserve
+income
+reserves
+reserves
+profits
+shares
+interests
+Total
+Other comprehensive income
+294,388
+135,973
+4,309
+193,438
+267,981
+864,848
+(8)
+124,418
+2,162,837
+Total comprehensive income
+277,490
+-
+2,225,153
+135,973
+(119,016)
+(104,220)
+V.9
+Impairment losses on assets
+(202,411)
+(226,355)
+(8)
+Operating expenses
+567,647
+605,717
+Operating income
+58,605
+67,661
+V.5
+17,912
+Derivative financial liabilities
+V.16
+89,151
+212,052
+(75,203)
+(6,558)
+(68,645)
+(35,228)
+125,400
+956,987
+303,209
+other equity instruments holders
+V.37.3
+42,015
+(31)
+Other comprehensive income transferred to
+retained earnings
+Due to customers
+Other
+(2,944)
+52
+(225)
+216,559
+7,488
+221,103
+20,492
+(20,492)
+35,228
+As at 31 December 2021
+V.29
+V.6
+16,879,171
+410,373
+Total liabilities
+24,371,855
+22,239,822
+EQUITY
+Capital and reserves attributable to equity
+holders of the Bank
+Share capital
+Other equity instruments
+Capital reserve
+Treasury shares
+V.37.1
+18,142,887
+294,388
+V.37.3
+319,505
+277,490
+V.37.2
+135,717
+436,555
+V.36
+294,388
+6,499
+Other liabilities
+Bonds issued
+V.30
+1,388,678
+1,244,403
+V.31
+26,354
+26,034
+Current tax liabilities
+V.32
+Other borrowings
+55,665
+Retirement benefit obligations
+V.33
+2,095
+2,199
+Deferred income tax liabilities
+V.35
+45,006
+7,003
+Effective date
+Basis of preparation (Continued)
+1
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Minor amendments were made to IFRS 3 Business Combinations to update the references to
+the Conceptual Framework for Financial Reporting and add an exception for the recognition
+of liabilities and contingent liabilities within the scope of IAS 37 Provisions, Contingent
+Liabilities and Contingent Assets and Interpretation 21 Levies. The amendments also
+confirm that contingent assets should not be recognised at the acquisition date.
+222
+IAS 16 Amendments prohibit entities from deducting from the cost of an item of property,
+plant and equipment, any proceeds received from selling items produced while the entity is
+preparing the asset for its intended use. It also clarifies that an entity is ‘testing whether the
+asset is functioning properly' when it assesses the technical and physical performance of the
+asset. The financial performance of the asset is not relevant to this assessment. Entities must
+disclose separately the amounts of proceeds and costs relating to items produced that are not
+an output of the entity's ordinary activities.
+has been deferred
+indefinitely
+1.3 Standards and amendments that are not yet effective in the current year and have not
+been adopted before their effective dates by the Group (Continued)
+1 January 2023
+1 January 2023
+BANK OF CHINA LIMITED
+IAS 37 Amendments specify which costs an entity needs to include when assessing
+whether a contract is onerous or loss-making. The amendments apply a "directly related
+cost approach". Costs that relate directly to a contract to provide goods or services include
+both incremental costs and an allocation of costs directly related to contract activities.
+Before recognising a separate provision for an onerous contract, the entity recognises any
+impairment loss that has occurred on assets used in fulfilling the contract. General and
+administrative costs do not relate directly to a contract and are excluded unless they are
+explicitly chargeable to the counterparty under the contract.
+Basis of preparation (Continued)
+IFRS 17 Insurance Contracts and amendments replaced IFRS 4 Insurance Contracts. The
+standard provides a general model for insurance contracts and two additional approaches:
+the variable fee approach and the premium allocation approach. IFRS 17 and amendments
+cover the recognition, measurement, presentation and disclosure of insurance contracts and
+apply to all types of insurance contracts.
+1 January 2023
+1 January 2023
+The Group is considering the impact of IFRS 17 and amendments on the consolidated and
+the Bank's financial statements. Except for IFRS 17 and amendments, the adoption of the
+above standards and amendments will have no material impact on the consolidated and the
+Bank's financial statements.
+IFRS 10 and IAS 28 Amendments clarify the accounting treatment for sales or contribution
+of assets between an investor and its associates or joint ventures. The amendments require
+a full recognition of a gain or loss when the sale or contribution between an investor and its
+associate or joint venture constitutes a business. For a transaction involving assets that do
+not constitute a business, a gain or loss resulting from the transaction is recognised in the
+investor's profit or loss only to the extent of the unrelated investor's interest in that associate
+or joint venture.
+IAS 12 Amendments require companies to recognise deferred tax on transactions that,
+on initial recognition, give rise to equal amounts of taxable and deductible temporary
+differences. They will typically apply to transactions such as leases of lessees and
+decommissioning obligations and will require the recognition of additional deferred tax
+assets and liabilities. The amendments should be applied to transactions that occur on or
+after the beginning of the earliest comparative period presented.
+IAS 8 Amendments clarify how companies should distinguish changes in accounting
+policies from changes in accounting estimates. It introduces a new definition of "accounting
+estimates”. The amendments are designed to clarify distinction between changes in
+accounting estimates and changes in accounting policies and correction of errors.
+1.3 Standards and amendments that are not yet effective in the current year and have not
+been adopted before their effective dates by the Group (Continued)
+Annual Improvements to IFRSS 2018-2020 Cycle were issued in May 2020, including an
+amendment to IFRS 9 Financial Instruments, which clarifies fees that an entity includes
+when assessing whether the terms of a new or modified financial liability are substantially
+different from the terms of the original financial liability by conducting the “10 per cent"
+test for derecognition of financial liabilities. These fees include only those paid or received
+between the borrower and the lender, including fees paid or received by either the borrower
+or lender on the other's behalf. The improvements also include an amendment to lease
+incentives, which removes the illustration of payments from the lessor relating to leasehold
+improvements in illustrative example 13 accompanying IFRS 16 Leases, so as to remove
+potential confusion regarding the treatment of lease incentives when applying IFRS 16.
+1
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+223
+IAS 1 and IFRS Practice Statement 2 Amendments provide guidance to help entities apply
+materiality judgements to accounting policy disclosures. The amendments replace the
+requirement for entities to disclose their “significant” accounting policies with a requirement
+to disclose their “material” accounting policies. The amendments add guidance on how entities
+apply the concept of materiality in making decisions about accounting policy disclosures.
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+1 January 2022
+3.1 Functional and presentation currency
+1 January 2022
+1 January 2022
+221
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+The adoption of the above standards and amendments does not have any significant impact
+on the operating results, financial position and comprehensive income of the Group for the
+year ended 31 December 2021.
+1
+1.3 Standards and amendments that are not yet effective in the current year and have not
+been adopted before their effective dates by the Group
+IFRS 3 Amendments
+IAS 16 Amendments
+IAS 37 Amendments
+Annual Improvements to
+IFRSS 2018-2020 Cycle
+(issued in May 2020)
+IFRS 17 and Amendments
+IAS 1 and IFRS
+Practice Statement 2
+Amendments
+224
+Basis of preparation (Continued)
+1 January 2022
+In May 2020, the IASB published an amendment to IFRS 16 that provided an optional
+practical expedient for lessees to assess whether a rent concession due on or before 30 June
+2021 related to COVID-19 is a lease modification. In March 2021, the IASB published an
+additional amendment to extend the date of the rent concession from 30 June 2021 to 30
+June 2022. The amendment is effective for annual reporting periods beginning on or after 1
+April 2021 with earlier application permitted. The Group has early adopted this amendment
+for the current year.
+1.2 Standards and amendments that were early adopted by the Group in 2021
+Effective for
+annual periods
+beginning on or
+after
+Sale or Contribution of Assets
+between an Investor and its
+Associate or Joint Venture
+Definition of Accounting Estimates
+Deferred Tax related to Assets and
+Liabilities arising from a Single
+Transaction
+Insurance Contracts
+Disclosure of Accounting Policies
+Property, Plant and Equipment:
+Proceeds before Intended Use
+Onerous Contracts Cost of
+Fulfilling a Contract
+Minor Amendments to IFRS 1,
+IFRS 9, IAS 41 and IFRS 16
+Business Combination
+Amendment to IFRS 16 COVID-19 Related rent concessions extension of the practical
+expedient
+IFRS 10 and IAS 28
+Amendments
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+1
+Basis of preparation (Continued)
+1.1 Standards and amendments effective in 2021 relevant to and adopted by the Group
+(Continued)
+(2) the amendments also provide additional temporary reliefs from applying specific
+IAS 39 and IFRS 9 hedge accounting requirements to hedging relationships directly
+affected by IBOR Reform.
+The adoption of the above standards and amendments does not have any significant impact
+on the operating results, financial position and comprehensive income of the Group for the
+year ended 31 December 2021.
+IAS 8 Amendments
+IAS 12 Amendments
+BANK OF CHINA LIMITED
+The functional currency of the Group's operations in the Chinese mainland is Renminbi
+("RMB"). Items included in the financial statements of each of the Group's operations in
+Hong Kong (China), Macao (China), Taiwan (China) and other countries and regions are
+measured using the currency of the primary economic environment in which the entity
+operates (the "functional currency"). The presentation currency of the Group is RMB.
+FOR THE YEAR ENDED 31 DECEMBER 2021
+4.2 Classification and Subsequent measurement
+The fair value of a financial instrument at initial recognition is normally the transaction
+price. If the Group determines that the fair value at initial recognition differs from the
+transaction price, and if that fair value is evidenced by a quoted price in an active market
+for an identical asset or liability or based on a valuation technique that uses only data from
+observable markets, the Group recognises the difference between the fair value at initial
+recognition and the transaction price as a gain or loss.
+At initial recognition, the Group measures a financial asset or financial liability at its
+fair value. For a financial asset or financial liability at fair value through profit or loss,
+transaction costs are directly recognised in profit or loss. For other financial asset or
+liability, transaction costs are recognised in the initial measurement.
+The Group recognises a financial asset or financial liability in its statement of financial
+position when the Group becomes a party to the contractual provisions of the instrument,
+which is the trade date.
+4.1 Initial recognition and measurement
+Financial instruments
+4
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+4.2.1 Financial assets
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+228
+The effect of exchange rate changes on cash and cash equivalents is presented individually
+in the statement of cash flows.
+On consolidation, exchange differences arising from the translation of the net investment in
+foreign entities, and of customers deposits taken and other currency instruments designated
+as hedges of such investments are taken to other comprehensive income. When a foreign
+entity is disposed, these exchange differences are recognised in the income statement.
+all resulting exchange differences are recognised in other comprehensive income.
+income and expenses for each income statement are translated at exchange rates at the
+date of the transactions, or a rate that approximates the exchange rates of the date of the
+transaction; and
+assets and liabilities for each statement of financial position presented are translated at
+the closing rate at the date of that statement of financial position;
+•
+•
+The results and financial positions of all the Group entities that have a functional currency
+different from the presentation currency are translated into the presentation currency as
+follows:
+Non-monetary assets and liabilities that are measured at historical cost in foreign currencies
+are translated using the foreign exchange rates at the date of the transaction. Non-monetary
+assets and liabilities that are measured at fair value in foreign currencies are translated using
+the foreign exchange rates at the date the fair value is determined. Translation differences
+on non-monetary financial assets classified as financial assets at fair value through other
+comprehensive income are recognised in other comprehensive income. Translation
+differences on non-monetary financial assets and liabilities held at fair value through profit
+or loss are recognised as "Net trading gains” in the income statement.
+BANK OF CHINA LIMITED
+Monetary assets and liabilities denominated in foreign currencies at the financial reporting
+date are translated at the foreign exchange rates ruling at that date. Changes in the fair value
+of monetary securities denominated in foreign currency classified as financial assets at fair
+value through other comprehensive income are analysed between translation differences
+resulting from changes in the amortised cost of the security and other changes in the
+carrying amount of the security. Translation differences related to changes in the amortised
+cost are recognised in the income statement, and other changes in the carrying amount are
+recognised in other comprehensive income. Translation differences on all other monetary
+assets and liabilities are recognised in the income statement.
+The Group classifies financial assets as subsequently measured at amortised cost, fair value
+through other comprehensive income or fair value through profit or loss on the basis of both
+the Group's business model for managing the financial assets and the contractual cash flow
+characteristics of the financial asset.
+The Group's business model refers to how the Group manages its financial assets in order to
+generate cash flows. For example, financial assets are held within a business model whose
+objective is to hold assets to collect contractual cash flows or within a business model whose
+objective is achieved by both collecting contractual cash flows and selling financial assets. If
+above two situations are not applicable, the financial assets are classified as part of “other”
+business model. The Group's assessment of the business model is performed on a financial
+asset portfolio basis, and determined on the basis of scenarios which are reasonably expected
+to occur, taking into account: how cash flows were realised in the past, how the performance
+are evaluated and reported to the entity's key management personnel; the risks that affect the
+performance and the way in which those risks are assessed and managed; and how managers
+of the business are compensated, etc.
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES
+1
+Basis of preparation
+The consolidated financial statements of the Group have been prepared in accordance
+with International Financial Reporting Standards ("IFRSs"). In addition, the consolidated
+financial statements comply with the disclosure requirements of the Hong Kong Companies
+Ordinance.
+Financial assets at fair value through other comprehensive income, financial assets and
+financial liabilities at fair value through profit or loss (including derivative financial
+instruments) and investment properties are measured at their fair values in the consolidated
+financial statements. Other accounting items are measured at their historical costs.
+Impairment allowance is recognised and measured in accordance with the relevant policy.
+The preparation of financial statements in conformity with IFRSS requires the use of certain
+critical accounting estimates. It also requires management to exercise its judgement in the
+process of applying the Group's accounting policies. The areas involving a higher degree of
+judgement or complexity, or areas where assumptions and estimates are significant to the
+consolidated financial statements are disclosed in Note III.
+Business model
+1.1 Standards and amendments effective in 2021 relevant to and adopted by the Group
+-
+IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Amendments Interest Rate Benchmark
+Reform ("IBOR Reform”) — Phase 2
+_
+The IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Phase 2 amendments address issues
+that arise upon replacing the existing interest rate benchmark with the alternative interest
+rates and introduces additional disclosure requirements. The Phase 2 amendments provide
+two key reliefs:
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+220
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+229
+On 1 January 2021, the Group has adopted the following IFRSS and amendments issued by
+the International Accounting Standards Board (“IASB"), which were mandatorily effective.
+3.2 Transactions and balances (Continued)
+(1) for instruments measured using amortised cost measurement, the amendments provide
+a practical expedient to account for these changes in the basis for determining
+contractual cash flows as a result of IBOR Reform. Under the practical expedient,
+entities will account for these changes by updating the effective interest rate using the
+guidance in paragraph B5.4.5 of IFRS 9 without the recognition of an immediate gain
+or loss. This practical expedient applies only to such a change and only to the extent
+that it is necessary as a direct consequence of IBOR Reform, and the new basis for
+determining the contractual of cash flows is economically equivalent to the previous
+basis.
+3
+Joint ventures exist where the Group has a contractual arrangement with one or more parties
+to undertake economic activities which are subject to joint control.
+Associates are all entities over which the Group has significant influence but no control
+or joint control, generally accompanying a shareholding of between 20% and 50% of the
+voting rights.
+2.2 Associates and joint ventures
+In the Bank's statement of financial position, investments in subsidiaries are accounted
+for at cost less impairment. Cost is adjusted to reflect changes in consideration arising
+from contingent consideration amendments, but does not include acquisition-related costs,
+which are expensed as incurred. Dividends or profits declared to distribute by the invested
+entity shall be recognised by the Bank as other operating income. The Group assesses at
+each financial reporting date whether there is objective evidence that an investment in
+subsidiaries is impaired. An impairment loss is recognised for the amount by which the
+investment in subsidiaries' carrying amount exceeds its recoverable amount. Recoverable
+amount is the higher of the investment in subsidiaries' fair value less costs to sell and value
+in use.
+2.1 Subsidiaries (Continued)
+Consolidation (Continued)
+2
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+Investments in associates and joint ventures are initially recognised at cost and accounted
+for using the equity method of accounting. The Group's "Investment in associates and joint
+ventures" includes goodwill.
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+225
+The excess of the consideration transferred, the amount of any non-controlling interest in the
+acquiree and the acquisition-date fair value of any previous equity interest in the acquiree
+over the fair value of the net identifiable assets acquired is recorded as goodwill. If those
+amounts are less than the fair value of the net identifiable assets of the subsidiary acquired,
+in the case of a bargain purchase, the difference is recognised directly in the income
+statement. Goodwill is tested for impairment annually, or more frequently whenever there
+is an indication of possible impairment, and carried at cost less accumulated impairment
+losses. If there is any indication that goodwill is impaired, recoverable amount is estimated
+and the difference between carrying amount and recoverable amount is recognised as an
+impairment charge. Impairment losses on goodwill are not reversed. Gains and losses on the
+disposal of an entity include the carrying amount of goodwill relating to the entity sold.
+The Group uses acquisition method of accounting to account for business combinations.
+Consideration transferred for the acquisition of a subsidiary is the fair values of the assets
+transferred, the liabilities incurred to the former owners of the acquired business and the
+equity interests issued by the Group. Consideration transferred includes the fair value of any
+asset or liability resulting from a contingent consideration arrangement. Acquisition-related
+costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent
+liabilities assumed in a business combination are measured initially at their fair values at
+the acquisition date. On an acquisition by acquisition basis, the Group recognises any non-
+controlling interest in the acquiree either at fair value or at the non-controlling interest's
+proportionate share of the acquiree's net identifiable assets.
+Subsidiaries are all entities (including structured entities) over which the Group has control.
+The Group controls an entity where the Group is exposed to, or has rights to, variable
+returns from its involvement with the entity and has the ability to affect those returns
+through its power to direct the activities of the entity. The existence and effect of potential
+voting rights that are currently exercisable or convertible and rights arising from other
+contractual arrangements are considered when assessing whether the Group controls another
+entity. Subsidiaries are fully consolidated from the date on which control is transferred to
+the Group. They are de-consolidated from the date that control ceases. If the changes of the
+relevant facts and circumstances resulting in changes of relevant elements in the definition
+of control, the Group will re-evaluate whether subsidiaries are controlled.
+2.1 Subsidiaries
+Consolidation
+2
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+Foreign currency translation (Continued)
+BANK OF CHINA LIMITED
+Unrealised gains on transactions between the Group and its associates and joint ventures
+are eliminated to the extent of the Group's interests in the associates and joint ventures;
+unrealised losses are also eliminated unless the transaction provides evidence of impairment
+of the asset transferred. Accounting policies of associates and joint ventures have been
+changed where necessary to ensure consistency with the policies adopted by the Group.
+All intra-group assets and liabilities, equity, income, expenses and cash flows relating to
+transactions between members of the Group are eliminated in full on consolidation. Where
+necessary, accounting policies of subsidiaries have been changed to ensure consistency with
+the policies adopted by the Group.
+226
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+The Group assesses at each financial reporting date whether there is objective evidence that
+investments in associates and joint ventures are impaired. Impairment losses are recognised
+for the amounts by which the investments in associates and joint ventures' carrying amounts
+exceed their recoverable amounts. The recoverable amounts are the higher of investments in
+associates and joint ventures' fair value less costs to sell and value in use.
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+Foreign currency transactions are translated into respective functional currency using
+the exchange rates prevailing at the dates of the transactions, or the exchange rates that
+approximate the exchange rates prevailing at the dates of the transaction. Foreign exchange
+gains and losses resulting from the settlement of such transactions are recognised in the
+income statement.
+3.2 Transactions and balances
+(Amount in millions of Renminbi, unless otherwise stated)
+Foreign currency translation
+227
+When the Group ceases to consolidate or equity account for an investment because of a
+loss of control, joint control or significant influence, any retained interest in the entity is
+re-measured to its fair value, with the change in carrying amount recognised in the income
+statement. The fair value is the initial carrying amount for the purposes of subsequently
+accounting for the retained interest as an associate, joint venture or financial asset. In
+addition, any amounts previously recognised in other comprehensive income in respect of
+that entity are reclassified to the income statement.
+3
+BANK OF CHINA LIMITED
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+2
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+Consolidation (Continued)
+2.3 Transactions with non-controlling interests
+The Group treats transactions with non-controlling interests that do not result in a loss of
+control as transactions with equity owners of the Group. For purchases from non-controlling
+interests, the difference between any consideration paid and the relevant share acquired of
+the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on
+disposals to non-controlling interests are also recorded in equity.
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+Financial instruments (Continued)
+4.7 Modification of contractual cash flows
+4
+The Group sometimes modifies or renegotiates the contractual cash flows with a
+counterparty, which include extending payment term arrangements, repayment schedule
+modifications and changes to the interest settlement arrangement. When this happens, the
+Group assesses whether or not the new terms are substantially different to the original terms.
+When the Group determines that a loan has no reasonable prospect of recovery after the
+Group has taken necessary actions and necessary proceedings, the loan is written off
+against its allowance for impairment losses. If in a subsequent period the loan written off
+is recovered, the amount recovered will be recognised in profit or loss captured within
+impairment losses on financial assets.
+If the terms are substantially different, the Group derecognises the original financial asset
+and recognises a "new" asset at fair value and recalculates a new effective interest rate
+for the asset. The date of renegotiation is consequently considered to be the date of initial
+recognition for impairment calculation purposes, including for the purpose of determining
+whether a significant increase in credit risk has occurred. The Group also assesses whether
+the new financial asset recognised is deemed to be credit-impaired at initial recognition,
+especially in circumstances where the renegotiation was driven by the debtor being unable to
+make the originally agreed payments. Differences in the carrying amount are also recognised
+in profit or loss as a gain or loss on derecognition.
+4.8 Write off
+237
+FOR THE YEAR ENDED 31 DECEMBER 2021
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+If the terms are not substantially different, it does not result in a derecognition of the
+original financial asset. The risk of default of such assets after modification is assessed at
+the financial reporting date and compared with the risk under the original terms at initial
+recognition. The gross carrying amount of the financial asset is recalculated based on the
+present value of the renegotiated or modified contractual cash flows discounted at the
+financial asset's original effective interest rate, and the related gain or loss is recognised in
+profit and loss.
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Where, in the previous accounting period, the impairment allowance of a financial
+instrument was measured based on the ECL of the instrument over the entire lifetime, and
+while, at the current financial reporting date, such financial instrument is no longer regarded
+as experiencing a significant increase in credit risk since its initial recognition, the Group
+measures the impairment allowance of the financial instrument as at the financial reporting
+date using the ECL of the instrument over the next 12 months.
+236
+FOR THE YEAR ENDED 31 DECEMBER 2021
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+4
+Financial instruments (Continued)
+4.6 Impairment measurement for losses on assets (Continued)
+Measurement of ECL (Continued)
+BANK OF CHINA LIMITED
+For purchased or originated credit-impaired financial assets, the Group only recognises the
+cumulative changes in lifetime expected credit losses since initial recognition at the financial
+reporting date as an impairment allowance. At each financial reporting date, the Group
+recognises in profit or loss the amount of the change in lifetime expected credit losses as an
+impairment gain or loss.
+An unbiased and probability-weighted amount that is determined by evaluating a range
+of possible outcomes;
+•
+Time value of money; and
+•
+Reasonable and supportable information about past events, current conditions and
+forecasts of future economic conditions that is available without undue cost or effort at
+the financial reporting date.
+When measuring ECL, an entity need not necessarily identify every possible scenario.
+However, the Group considers the risk or probability that a credit loss occurs by reflecting
+the possibility that a credit loss occurs and the possibility that no credit loss occurs, even
+if the possibility of a credit loss occurring is very low. The parameters, assumptions and
+estimation techniques used in measuring the ECL are disclosed in Note VI.2.3 measurement
+of ECL.
+The Group measures ECL of a financial instrument in a way that reflects:
+(Amount in millions of Renminbi, unless otherwise stated)
+Possible sources of ineffectiveness are as follows:
+4
+(Amount in millions of Renminbi, unless otherwise stated)
+239
+If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying
+amount of a hedged item for which the effective interest method is used is amortised to the
+income statement over the period to maturity.
+The changes in fair value of hedging instruments that are designated and qualify as fair
+value hedges are recorded in the income statement, together with the changes in fair value of
+the hedged item attributable to the hedged risk. The net result is included as ineffectiveness
+in the income statement.
+Fair value hedge is a hedge of the exposure to changes in fair value of a recognised asset
+or liability or an unrecognised firm commitment, or a component of any such item, that is
+attributable to a particular risk and could affect profit or loss.
+(1) Fair value hedge
+If a hedging relationship ceases to meet the hedge effectiveness requirement relating to
+the hedge ratio but the risk management objective for that designated hedging relationship
+remains the same, the Group adjusts the hedge ratio of the hedging relationship so that it
+meets the qualifying criteria again.
+The Group discontinues hedge accounting prospectively when the hedging instrument
+expires or is sold, terminated or exercised (the replacement or rollover of a hedging
+instrument into another hedging instrument does not constitute an expiration or termination),
+or the hedging relationship ceases to meet the updated risk management objective, or to
+meet other qualifying criteria for hedging accounting.
+Notional and timing differences between the hedged items and hedging instruments;
+Significant changes in counterparties' credit risk.
+•
+The hedge ratio of the hedging relationship is the same as that resulting from the
+quantity of the hedged item that the entity actually hedges and the quantity of the
+hedging instrument that the entity actually uses to hedge that quantity of the hedged
+item. However, that designation shall not reflect an imbalance between the weightings
+of the hedged item and the hedging instrument that would create hedge ineffectiveness
+that could result in an accounting outcome that would be inconsistent with the purpose
+of hedge accounting.
+•
+4.9 Derivative financial instruments and hedge accounting (Continued)
+Financial instruments (Continued)
+4
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+Financial instruments (Continued)
+4.9 Derivative financial instruments and hedge accounting
+Derivatives are initially recognised at fair value on the date a derivative contract is
+entered into and are subsequently remeasured at their fair value. Fair values are obtained
+from quoted market prices in active markets, including recent market transactions, or
+valuation techniques, including discounted cash flow analysis and option pricing models, as
+appropriate. Credit risk valuation adjustments are applied to the Group's over-the-counter
+derivatives to reflect the credit risk of the counterparties and the Group, respectively. They
+are dependent on the expected future values of exposures for each counterparty and default
+probabilities, etc. All derivatives are carried as assets when the fair value is positive and as
+liabilities when the fair value is negative.
+The treatment of recognising the resulting fair value gain or loss depends on whether the
+derivative is designated and qualifies as a hedging instrument, and if so, the nature of the
+item being hedged. For derivatives not designated or qualified as hedging instruments,
+including those intended to provide effective economic hedges of specific interest rate and
+foreign exchange risks, but do not qualify for hedge accounting, changes in the fair value of
+these derivatives are recognised in "Net trading gains" in the income statement.
+The Group documents, at inception, the relationship between hedging instruments and
+hedged items, as well as its risk management objective and strategy for undertaking hedge
+transactions. When designating a hedging relationship and on an ongoing basis, the Group
+assesses the hedge effectiveness, that is the extent to which changes in the fair value or cash
+flows of the hedging instrument offsets changes in fair values or cash flows of the hedged
+item.
+The hedging relationship should meet all of the following hedge effectiveness requirements:
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+•
+There is an economic relationship between the hedged item and the hedging
+instrument. That means the hedging instrument and hedged item have values that
+generally move in the opposite direction because of the same risk, which is the hedged
+risk;
+The effect of credit risk does not dominate the value changes that result from that
+economic relationship; and
+238
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+•
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(2) Financial assets at fair value through other comprehensive income
+BANK OF CHINA LIMITED
+(2) Financial assets at fair value through other comprehensive income (Continued)
+Such financial assets that the Group holds are subsequently measured at fair value. A gain
+or loss on a financial asset measured at fair value through other comprehensive income
+shall be recognised in “Other comprehensive income”, except for interests calculated using
+effective interest method, impairment losses or reversal and foreign exchange gains and
+losses. When the financial asset is derecognised, the cumulative gain or loss previously
+recognised in other comprehensive income is reclassified from equity to profit or loss. The
+impairment allowances for such financial assets are recognised in other comprehensive
+income, impairment losses or reversal are recognised in profit or loss, and not reduce the
+carrying amount of such financial assets in the statement of financial position.
+Investments in equity instruments
+The Group may, at initial recognition, irrevocably designate an investment in equity
+instrument, which is not held for trading, as at fair value through other comprehensive
+income when it meets the definition of an equity instrument under IAS 32 Financial
+Instruments: Presentation. When the equity instrument is derecognised, the cumulative gain
+or loss previously recognised in other comprehensive income shall be reclassified from other
+comprehensive income to undistributed profits under equity. Dividends, which the Group is
+entitled to collect, on equity investments in such measurement category are recognised in
+profit or loss. No impairment losses or reversal are recognised for such equity instruments.
+(3) Financial assets at fair value through profit or loss
+A financial asset is measured at fair value through profit or loss unless it is measured
+at amortised cost or at fair value through other comprehensive income, which includes
+financial assets held for trading, financial assets designated as at fair value through profit or
+loss and other financial assets mandatorily measured at fair value through profit or loss in
+accordance with IFRS 9.
+Such financial assets that the Group holds are subsequently measured at fair value. A gain
+or loss on such financial asset is recognised in profit or loss unless it is part of a hedging
+relationship. Dividends, which the Group is entitled to collect, on equity investments in such
+measurement category are recognised in profit or loss.
+231
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+4
+Financial instruments (Continued)
+4.2 Classification and Subsequent measurement (Continued)
+4.2.1 Financial assets (Continued)
+(3) Financial assets at fair value through profit or loss (Continued)
+When, and only when, the Group changes the business model for managing financial assets, the
+Group shall reclassify all affected financial assets. Reclassification is applied prospectively from
+the first day of the first reporting period following the change in business model.
+4.2.2 Financial liabilities
+The Group classifies all financial liabilities as subsequently measured at amortised cost,
+except for:
+•
+•
+financial liabilities at fair value through profit or loss. Such liabilities, include financial
+liabilities held for trading and financial liabilities designated as at fair value through
+profit or loss.
+financial liabilities that arise when a transfer of a financial asset does not qualify for
+derecognition or when the continuing involvement approach applies.
+financial guarantee contracts and commitments to provide a loan at a below-market
+interest rate.
+Financial liabilities at fair value through profit or loss held by the Group are subsequently
+measured at fair value. A gain or loss on a financial liability that is measured at fair value is
+recognised in profit or loss unless:
+4.2.1 Financial assets (Continued)
+4.2 Classification and Subsequent measurement (Continued)
+Financial instruments (Continued)
+4
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+4
+Financial instruments (Continued)
+4.2 Classification and Subsequent measurement (Continued)
+4.2.1 Financial assets (Continued)
+The contractual cash flow characteristics
+The assessment of contractual cash flow characteristics is to determine whether the asset's
+contractual cash flows are solely payments of principal and interest on the principal amount
+outstanding. Principal is the fair value of the financial asset at initial recognition. However,
+the principal amount may change over the life of the financial asset (for example, if there are
+repayments of principal). Interest consists of consideration for the time value of money, for
+the credit risk associated with the principal amount outstanding during a particular period of
+time and for other basic lending risks and costs, as well as a profit margin.
+(1) Financial assets at amortised cost
+The Group classifies financial assets as subsequently measured at amortised cost if both of
+the following conditions are met:
+•
+•
+the financial asset is held within a business model whose objective is to hold financial
+assets in order to collect contractual cash flows; and
+the contractual terms of the financial asset give rise on specified dates to cash flows
+that are solely payments of principal and interest on the principal amount outstanding.
+Such financial assets that the Group holds are subsequently measured at amortised cost.
+That is, the amount at which the financial asset is measured at initial recognition minus the
+principal repayments, plus or minus the cumulative amortisation using the effective interest
+method of any difference between that initial amount and the maturity amount and adjusted
+for any loss allowance.
+The Group classifies financial assets as subsequently measured at fair value through other
+comprehensive income if both of the following conditions are met:
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+the financial asset is held within a business model whose objective is achieved by both
+collecting contractual cash flows and selling financial assets; and
+the contractual terms of the financial asset give rise on specified dates to cash flows
+that are solely payments of principal and interest on the principal amount outstanding.
+230
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+•
+it is part of a hedging relationship; or
+•
+it is a financial liability designated as at fair value through profit or loss and the effects
+of changes in the Group's credit risk are presented in other comprehensive income.
+When such financial liability is derecognised, the cumulative gain or loss previously
+recognised in other comprehensive income is reclassified from other comprehensive
+income to undistributed profits under equity.
+Financial guarantee contracts are contracts that require the issuer to make specified
+payments to reimburse the holder for a loss it incurs because a specified debtor fails to
+make payments when due, in accordance with the terms of a debt instrument. Such financial
+guarantees are given to banks, financial institutions and other bodies to secure customer
+loans, overdrafts and other banking facilities.
+Financial guarantees are initially recognised at fair value on the date the guarantee was
+given. Subsequent to initial recognition, the financial guarantee contracts are measured
+at the higher of the initial measurement less amortisation calculated and the impairment
+allowance determined by the expected credit loss ("ECL") model at the financial reporting
+date. Any increase in the liability relating to financial guarantee contracts is recognised in
+the income statement.
+Loan commitments are commitments provided by the Group to customers to grant loans
+under the established contract terms during certain period. The impairment allowance for
+loan commitments is measured using the ECL model.
+The impairment allowances for financial guarantees and loan commitments are presented in
+“Other liabilities — provision”.
+4.4 Determination of fair value
+The fair value is the price that would be received to sell an asset or paid to transfer a liability
+in an orderly transaction between market participants at the measurement date. The fair
+values of quoted financial assets and financial liabilities in active markets are based on
+market prices, as appropriate. If there is no active market, the Group establishes fair value
+by using valuation techniques. These include the use of recent arm's length transactions,
+discounted cash flow analysis and option pricing models, and other valuation techniques
+commonly used by market participants.
+The Group uses the valuation techniques commonly used by market participants to price
+financial instruments and techniques which have been demonstrated to provide reliable
+estimates of prices obtained in actual market transactions. The Group makes use of all
+factors that market participants would consider in setting a price, and incorporates these
+into its chosen valuation techniques and tests for validity using prices from any observable
+current market transactions in the same instruments.
+234
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+4.3 Financial guarantee contracts and loan commitments
+4
+4.5 Derecognition of financial instruments
+Financial assets are derecognised when the rights to receive cash flows from the investments
+have expired, or when a financial asset is transferred, the Group has transferred substantially
+all risks and rewards of ownership, or when the Group neither transfers nor retains
+substantially all risks or rewards of ownership of the financial asset but has not retained
+control of the financial asset.
+4.6 Impairment measurement for losses on assets
+At the financial reporting date, the Group assesses and recognises the relevant impairment
+allowances for financial assets measured at amortised cost, debt instruments measured at fair
+value through other comprehensive income, and loan commitments and financial guarantee
+contracts on the basis of expected credit losses.
+Measurement of ECL
+ECL is a weighted average of credit losses on financial instruments weighted at the risk of
+default. Credit loss is the difference between all contractual cash flows that are due to the
+Group in accordance with the contract and all cash flows expected to be received by the
+Group discounted at the original effective interest rate (or credit-adjusted effective interest
+rate for purchased or originated credit-impaired financial assets), i.e. the present value of all
+cash shortfalls.
+According to the changes of credit risk of financial instruments since initial recognition, the
+Group calculates ECL by three stages:
+•
+Stage 1: Financial instruments without significant increases in credit risk since initial
+recognition are included under Stage 1 to calculate their impairment allowance at an
+amount equivalent to the ECL of the financial instruments for the next 12 months;
+Stage 2: Financial instruments that have had a significant increase in credit risk since
+initial recognition but have no objective evidence of impairment are included under
+Stage 2, with their impairment allowance measured at an amount equivalent to the ECL
+over the lifetime of the financial instruments;
+Stage 3: Financial assets with objective evidence of impairment at the financial
+reporting date are included under Stage 3, with their impairment allowance measured at
+an amount equivalent to the ECL over the lifetime of the financial instruments.
+235
+•
+Financial instruments (Continued)
+Financial instruments (Continued)
+Financial liabilities are derecognised when they are extinguished that is, when the
+obligation is discharged, cancelled or expires.
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+The Group does not reclassify any financial liabilities.
+4
+232
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+4
+Financial instruments (Continued)
+4.2 Classification and Subsequent measurement (Continued)
+4.2.3 Financial assets and financial liabilities held for trading
+A financial asset or financial liability is classified as held for trading if it:
+•
+•
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+is acquired or incurred principally for the purpose of selling or repurchasing it in the
+near term; or
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+•
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+233
+a portfolio of financial liabilities or financial assets and financial liabilities is managed
+and its performance is evaluated on a fair value basis, in accordance with a documented
+risk management or investment strategy, and information about the portfolio is
+provided internally on that basis to the Group's key management personnel; or
+the financial liability contains one or more embedded derivatives, unless the embedded
+derivative(s) does not significantly modify the cash flows or it is clear, with little or no
+analysis, that it would not be separately recorded.
+it eliminates or significantly reduces a measurement or recognition inconsistency that
+would otherwise arise from measuring assets or liabilities or recognising the gains and
+losses on them on different bases; or
+•
+4.2.4 Financial assets and financial liabilities designated as at fair value through profit or loss
+The Group may, at initial recognition, irrevocably designate a financial asset or financial
+liability as measured at fair value through profit or loss, because either:
+is a derivative (except for a derivative that is a financial guarantee contract or a
+designated and effective hedging instrument).
+on initial recognition is part of a portfolio of identified financial instruments that are
+managed together and for which there is evidence of a recent actual pattern of short-
+term profit-taking; or
+BANK OF CHINA LIMITED
+7
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+Property and equipment (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+242
+statements.
+The Group's property and equipment mainly comprise buildings, equipment and motor
+vehicles, aircraft and construction in progress. When the costs attributable to the land use
+rights cannot be reliably measured and separated from that of the building at inception, the
+costs are included in the cost of buildings and recorded in "Property and equipment”.
+Property and equipment
+7
+Securities lending transactions are generally secured, with collateral taking the form
+of securities or cash. Securities lent to counterparties by the Group are recorded in the
+consolidated financial statements. Securities borrowed from counterparties by the Group
+are not recognised in the consolidated financial statements of the Group. Cash collateral
+received or advanced is recognised as a liability or an asset in the consolidated financial
+The difference between purchase and sale price is recognised as “Interest expense” or
+"Interest income” in the income statement over the life of the agreements using the effective
+interest method.
+Subsequent costs are included in an asset's carrying amount, only when it is probable that
+future economic benefits associated with the item will flow to the Group and the cost of the
+item can be measured reliably. All other repairs and maintenance costs are charged to the
+income statement during the financial period in which they are incurred.
+Repurchase agreements, agreements to re-sell and securities lending
+Securities and bills sold subject to repurchase agreements ("Repos") continue to be
+recognised, and are recorded as “Financial investments". The corresponding obligation is
+included in "Placements from banks and other financial institutions" and "Due to central
+banks”. Securities and bills purchased under agreements to re-sell (“Reverse repos") are not
+recognised. The receivables are recorded as “Placements with and loans to banks and other
+financial institutions" or "Balances with central banks", as appropriate.
+Assets purchased or constructed are initially measured at acquisition cost or deemed cost,
+as appropriate. Such initial cost includes expenditure that is directly attributable to the
+acquisition of the assets.
+Depreciation is calculated on a straight-line method to write down the cost of such assets to
+their residual values over their estimated useful lives. The residual values and useful lives of
+assets are reviewed, and adjusted if appropriate, at each financial reporting date.
+Equipment
+Gains and losses on disposals are determined by the difference between proceeds and
+carrying amount, after deduction of relevant taxes and expenses. These are included in the
+income statement.
+3%
+Precious metals comprise gold, silver and other precious metals. The Group retains all risks
+and rewards of ownership related to precious metals deposited with the Group, including
+the right to freely pledge or transfer, and it records the precious metals received as an asset.
+A liability to return the amount of precious metals deposited is also recognised. Precious
+metals that are not related to the Group's precious metal market making and trading
+activities are initially measured at acquisition cost and subsequently measured at the lower
+of cost and net realisable value. Precious metals that are related to the Group's market
+making and trading activities are initially recognised at fair value and subsequent changes in
+fair value included in "net trading gains" are recognised in the income statement.
+4-6 years
+Motor vehicles
+6.4%-32.4%
+3%
+3-15 years
+1.9%-6.5%
+Property and equipment are reviewed for impairment at each financial reporting date. Where
+the carrying amount of an asset is greater than its estimated recoverable amount, it is written
+down immediately to its recoverable amount. The recoverable amount is the higher of the
+asset's fair value less costs to sell and value in use.
+3%
+Buildings
+rate
+Annual
+depreciation
+Estimated
+residual
+value rate
+Estimated
+useful lives
+Type of assets
+Buildings comprise primarily branch and office premises. The estimated useful lives,
+estimated residual value rate and depreciation rate of buildings, equipment and motor
+vehicles are as follows:
+7.1 Buildings, equipment and motor vehicles
+15-50 years
+Precious metals
+When the Group separates the forward element and the spot element of a forward contract
+and designates as the hedging instrument only the change in the value of the spot element,
+the changes in the value of the forward element of the forward contract shall be recognised
+in other comprehensive income to the extent that it relates to the hedged item.
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+The effective portion of changes in the fair value of hedging instruments that are designated
+and qualify as cash flow hedges is recognised in “Other comprehensive income". The
+ineffective portion is recognised immediately in the income statement.
+Amounts accumulated in equity are reclassified to the income statement in the same periods
+when the hedged future cash flows affect profit or loss.
+When the Group discontinues hedge accounting for a cash flow hedge, if the hedged future
+cash flows are still expected to occur, that amount accumulated in the cash flow hedge
+reserve shall remain in equity. If the hedged future cash flows are no longer expected to
+occur, that amount shall be immediately reclassified from the cash flow hedge reserve to
+profit or loss.
+(3) Net investment hedge
+Net investment hedge is a hedge of a net investment in a foreign operation.
+Hedges of net investments in foreign operations are accounted for similarly to cash flow
+hedges. Any gain or loss on the hedging instrument relating to the effective portion of the
+hedge is recognised directly in other comprehensive income; the gain or loss relating to the
+ineffective portion is recognised immediately in the income statement. Gains and losses
+accumulated in equity are reclassified to the income statement when the foreign operation is
+disposed of as part of the gain or loss on the disposal.
+240
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+4
+Financial instruments (Continued)
+4.10 Embedded derivatives
+16.1%-24.3%
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+Cash flow hedge is a hedge of the exposure to variability in cash flows that is attributable to
+a particular risk associated with all, or a component of, a recognised asset or liability (such
+as all or some future interest payments on variable-rate debt) or a highly probable forecast
+transaction, and could affect profit or loss.
+(2) Cash flow hedge
+4.9 Derivative financial instruments and hedge accounting (Continued)
+Financial instruments (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+241
+Financial assets and liabilities are offset and the net amount is reported in the statement of
+financial position when there is a current legally enforceable right to set off the recognised
+amounts and there is an intention to settle on a net basis, or realise the asset and settle the
+liability simultaneously.
+4.11 Offsetting financial instruments
+If it is unable to measure the embedded derivative separately either at acquisition or at the
+subsequent financial reporting date, the Group will designate the entire hybrid instrument as
+at fair value through profit or loss.
+5
+These embedded derivatives separated from the host contract are measured at fair value with
+changes in fair value recognised in the income statement.
+a separate instrument with the same terms as the embedded derivative would meet the
+definition of a derivative; and
+the economic characteristics and risks of the embedded derivative are not closely
+related to those of the host contract;
+•
+•
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+4
+the hybrid (combined) instrument is not measured at fair value with changes in fair
+value recognised in the income statement.
+(Amount in millions of Renminbi, unless otherwise stated)
+An embedded derivative is a component of a hybrid (combined) instrument that also
+includes a non-derivative host contract with the effect that some of the cash flows of the
+hybrid (combined) instrument vary in a way similar to a stand-alone derivative.
+The recoverable amount of an intangible asset is the higher of the asset's fair value less costs
+to sell and value in use.
+use assets.
+At the commencement date of the lease, the Group recognises a right-of-use asset. The cost
+of the right-of-use asset comprises:
+(1) the amount of the initial measurement of the lease liability;
+(2) any lease payments made at or before the commencement date of the lease less any
+lease incentives received;
+(3) any initial direct costs incurred when the Group is a lessee; and
+(4) an estimate of costs to be incurred by the lessee in dismantling and removing the
+underlying asset, restoring the site on which it is located or restoring the underlying
+asset to the condition required by the terms and conditions of the lease.
+The right-of-use assets are depreciated on a straight-line basis subsequently by the Group.
+If the Group is reasonably certain that the ownership of the underlying asset will be
+transferred to the Group at the end of the lease term, the Group depreciates the asset from
+the commencement date to the end of the useful life of the asset. Otherwise, the Group
+depreciates the asset from the commencement date to the earlier of the end of the useful life
+of the asset or the end of the lease term.
+The Group remeasures the lease liabilities at the present value of the changed lease
+payments and adjusts the carrying amounts of the right-of-use assets accordingly. When the
+carrying amount of the right-of-use asset is reduced to zero, and there is a further reduction
+in the measurement of the lease liability, the Group recognises the remaining amount of the
+remeasurement in profit or loss.
+Lease liabilities
+249
+Pursuant to local government regulations, all employees in Chinese mainland participate
+in various local housing funds administered by local governments. Operations in Chinese
+mainland contribute on a monthly basis to these funds based on certain percentages of the
+salaries of the employees. These payments are recognised as "Operating expenses" in the
+income statement as incurred.
+12.3 Housing funds
+Liabilities related to the above supplemental retirement benefit obligations and early
+retirement obligations existing at each financial reporting date is calculated by independent
+actuaries using the projected unit credit method and is recorded as a liability under
+"Retirement benefit obligations" in the statement of financial position. Liabilities represent
+the present value determined through discounting the estimated future cash outflows
+using interest rates of RMB treasury bonds which have terms to maturity approximating
+the terms of the related liability. Actuarial gains or losses of supplemental retirement
+benefit are recognised in "Other comprehensive income" immediately when they occur.
+Actuarial gains or losses of early retirement benefit obligations and gains or losses arising
+from amendments to retirement benefit obligations are charged or credited to the income
+statement immediately as “Operating expenses" when they occur.
+Early retirement benefits have been paid to those employees who accept voluntary
+retirement before the normal retirement date, as approved by management. The related
+benefit payments are made from the date of early retirement to the normal retirement date.
+Supplemental retirement benefits include supplemental pension payments and medical
+expense coverage.
+The Group pays supplemental retirement benefits to employees in Chinese mainland who
+retired prior to 31 December 2003 and early retirement benefits to those employees who
+accepted an early retirement arrangement.
+12.2 Retirement benefit obligations
+The obligations related to the defined benefit plans are calculated by independent actuaries
+using the projected unit credit method at each financial reporting date with actuarial gains
+or losses are recognised in "Other comprehensive income” immediately when they occur.
+Gains or losses arising from amendments to pension plans are charged or credited to the
+income statement immediately as “Operating expenses" when they occur.
+12.1 Defined contribution plans and Defined benefit plans (Continued)
+12 Employee benefits (Continued)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+The right-of-use assets of the Group mainly include buildings, vehicles and other right-of-
+Right-of-use assets
+8.1 As Lessee (Continued)
+Leases (Continued)
+Aircraft are depreciated using the straight-line method over the expected useful life of 25
+years, less the years in service at the time of purchase to an estimated residual value rate
+varying from 0% to 15%.
+243
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+7
+Property and equipment (Continued)
+7.3 Construction in progress
+8
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Construction in progress consists of assets under construction or being installed and is stated
+at cost. Cost includes equipment cost, cost of construction, installation and other direct
+costs. Items classified as construction in progress are transferred to property and equipment
+when such assets are ready for their intended use and the depreciation charge commences
+after such assets are transferred to property and equipment.
+At inception of a contract, the Group assesses whether the contract is, or contains, a lease. A
+contract is, or contains, a lease if the contract conveys the right to control the use of one or
+more identified assets for a period of time in exchange for consideration.
+8.1 As Lessee
+The lease term is the non-cancellable period of a lease for which the Group has the right to
+use an underlying asset. The Group considers a lease that, at the commencement date of the
+lease, has a lease term of 12 months or less, and does not contain any option to purchase
+the underlying asset as a short-term lease; and a lease for which the value of the individual
+underlying asset is relatively low when new as a lease of low-value asset. The Group
+chooses not to recognise the right-of-use assets and lease liabilities for short-term leases and
+leases of low-value assets, and the rental expenses are recognised as “Operating expenses"
+in the income statement on a straight-line basis over each period of the lease term.
+The Group uses the incremental borrowing rate as the discount rate to calculate the present
+value of lease payment. The economic circumstance and the observable interest rate set the
+foundation for each institution of the Group in determining the incremental borrowing rate.
+On this basis, the applicable incremental borrowing rate is calculated through the adjustment
+of the reference interest rate, which is determined according to the situation of the Bank and
+its subsidiaries and the underlying asset, the lease term, the amount of lease liability and
+other specific conditions of the lease.
+244
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+8
+Leases
+Aircraft are used in the Group's aircraft operating leasing business.
+BANK OF CHINA LIMITED
+Contributions made by the Group to the retirement schemes described above are recognised
+as "Operating expenses" in the income statement as incurred. Forfeited contributions by
+those employees who leave the schemes prior to the full vesting of their contributions are
+used to reduce the existing level of contributions or retained in the retirement schemes in
+accordance with the requirements of the respective defined contribution plans.
+8
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+246
+For a lease modification that is not accounted for as a separate lease, at the effective date
+of the lease modification, the Group remeasures the lease term and the lease liability by
+discounting the revised lease payments using a revised discount rate.
+(2) the consideration for the lease increases by an amount commensurate with the stand-
+alone price for the increase in scope and any appropriate adjustments to that stand-
+alone price to reflect the circumstances of the particular contract.
+(1) the modification increases the scope of the lease by adding the right to use one or more
+underlying assets; and
+The Group accounts for a lease modification as a separate lease if both:
+Lease modification is a change in the scope of a lease, the consideration for a lease or lease
+term, that was not part of the original terms and conditions of the lease. For example, adding
+or terminating the right to use one or more underlying assets, or extending or shortening the
+contractual lease term.
+Lease modification
+After the commencement date, the Group remeasures lease liabilities by discounting the
+revised lease payments if any of the following occur: (i) there is a change in the in-substance
+fixed payments; (ii) there is a change in the amounts expected to be payable under a residual
+value guarantee; (iii) there is a change in future lease payments resulting from a change
+in an index or a rate used to determine those payments; or (iv) there is a change in the
+assessments of options to purchase the underlying asset, extend or terminate the lease, or the
+circumstances of the actual exercise of these options.
+In calculating the present value of the lease payments, the Group uses the incremental
+borrowing rate of lessee as the discount rate. The Group calculates the interest expenses
+of lease liabilities in each period during the lease term using the constant periodic rate of
+interest, and recognises such interest expenses in profit or loss. Variable lease payments that
+are not included in the measurement of lease liabilities are recognised in profit or loss as
+incurred.
+Lease liabilities (Continued)
+8.1 As Lessee (Continued)
+Leases (Continued)
+8
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Leases (Continued)
+8.2 As Lessor
+At the inception date, a lease is classified as a finance lease if it transfers substantially all
+the risks and rewards incidental to ownership of an underlying asset. Otherwise, a lease is
+classified as an operating lease.
+If a hybrid contract contains a host that is a financial asset, the Group applies the
+requirements of classification and measurement to the entire hybrid contract. If a hybrid
+contract contains a host that is not a financial asset, the Group separates the embedded
+derivative from the host contract and accounts for it as a derivative, if, and only if:
+All eligible employees in operations in Hong Kong (China), Macao (China), Taiwan (China)
+and other countries and regions participate in local defined contribution schemes or defined
+benefit plans.
+In accordance with the policies of relevant state and local governments, employees
+in Chinese mainland participate in various defined contribution retirement schemes
+administered by local Labour and Social Security Bureaus. Operations in Chinese
+mainland contribute to pension and insurance schemes administered by the local pension
+and insurance agencies using applicable contribution rates stipulated in the relevant local
+regulations. Upon retirement, the local Labour and Social Security Bureaus are responsible
+for the payment of the basic retirement benefits to the retired employees. In addition to these
+basic staff pension schemes, employees in Chinese mainland who retire after 1 January 2004
+can also voluntarily participate in a defined contribution plan established by the Bank (“the
+Annuity Plan”). The Bank contributes to the Annuity Plan based on certain percentages of
+the employees' gross salaries.
+12.1 Defined contribution plans and Defined benefit plans
+Employee benefits
+Repossessed assets are initially recognised at fair value of the waived creditors' rights and
+other costs directly attributable to the assets when they are obtained as compensation for
+waiving the loans' principal and interest. When there are indicators that the recoverable
+amount is lower than carrying amount, the carrying amount is brought down to its
+recoverable amount.
+Repossessed assets
+At the commencement date of the lease, the Group measures the lease liabilities at the
+present value of the lease payments that are not paid at that date, except for short-term leases
+and leases of low-value assets.
+The value of intangible assets is reviewed for impairment at each financial reporting date.
+Where the carrying amount of an asset is greater than its estimated recoverable amount, it is
+written down immediately to its recoverable amount.
+12
+11
+10 Intangible assets (Continued)
+248
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+247
+Computer software and other intangible assets are stated at acquisition cost less accumulated
+amortisation and impairment. These costs are amortised on a straight-line basis over their
+estimated useful lives with the amortisation recognised in the income statement.
+Intangible assets are identifiable non-monetary assets without physical substance owned and
+controlled by the Group, including computer software and other intangible assets.
+10 Intangible assets
+Investment properties, principally consisting of office buildings, are held to generate
+rental income or earn capital gains or both and are not occupied by the Group. Investment
+properties are carried at fair value and changes in fair value are recorded in the income
+statement, representing the open market value and other related information determined
+periodically by independent appraisers.
+Investment properties
+When the Group is a lessor under operating leases, the Group reflects the underlying assets
+as the Group's assets. The rental income is recognised as “Other operating income" in the
+income statement on a straight-line basis over each period of the lease term. Income relating
+to variable lease payments that are not measured as part of the receivable in the lease are
+recognised in profit or loss as incurred.
+When the Group is a lessor under finance leases, the Group recognises the finance lease
+receivable and derecognises the assets under finance leases at the commencement date.
+The Group recognise assets held under a finance lease in the consolidated statement of
+financial position and such assets at an amount equal to the net investment in the lease. Net
+investment in the lease is the present value of the sum of the unguaranteed residual value
+and the lease payments that are not received at the commencement date, which is discounted
+by the interest rate implicit in the lease. The Group calculates and recognises the interest
+income in each period during the lease term using the constant periodic rate of interest, and
+recognises such interest income in profit or loss. Income relating to variable lease payments
+that are not measured as part of the net investment in the lease are recognised in profit or
+loss as incurred.
+(Amount in millions of Renminbi, unless otherwise stated)
+7.2 Aircraft
+BANK OF CHINA LIMITED
+245
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+20 Income taxes
+Income taxes comprise current income tax and deferred income tax. Tax is recognised in the
+income statement except to the extent that it relates to items directly recognised in Equity, in
+which case, tax is also directly recognised in Equity.
+20.1 Current income tax
+Current income tax is the expected tax payable on the taxable income for the year, using tax
+rates enacted or substantially enacted at the financial reporting date, and any adjustment to
+tax payable in respect of previous years.
+20.2 Deferred income tax
+Deferred income tax is recognised using the liability method, on temporary differences
+arising between the tax bases of assets and liabilities and their carrying amounts in the
+consolidated financial statements. Deferred income tax is determined using tax rates and
+laws that have been enacted or substantially enacted by the financial reporting date and are
+expected to apply when the related asset is realised, or the liability is settled.
+The principal temporary differences arise from asset impairment allowances, revaluation of
+certain financial assets and financial liabilities including derivative contracts, revaluation
+of investment properties, depreciation and amortisation, provisions for pension, retirement
+benefits and salary payables.
+Deferred income tax assets are recognised to the extent that it is probable that future taxable
+profit will be available against which deductible temporary differences can be utilised
+except the deferred tax asset arises from the initial recognition of an asset or liability in
+a transaction that is not a business combination and at the time of the transaction, affects
+neither accounting profit nor taxable profit/loss.
+For deductible temporary differences associated with investment in subsidiaries, associates
+and joint ventures, a deferred tax asset is recognised to the extent that, and only to the extent
+that, it is probable that the temporary difference will reverse in the foreseeable future; and
+taxable profit will be available against which the temporary difference can be utilised.
+Deferred tax liabilities shall be recognised for all taxable temporary differences, except
+to the extent that the deferred tax liability arises from the initial recognition of goodwill,
+or the initial recognition of an asset or liability in a transaction which is not a business
+combination, and at the time of the transaction, affects neither accounting profit nor taxable
+profit/loss.
+BANK OF CHINA LIMITED
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+254
+Fee and commission income
+Fiduciary activities
+The Group acts as a custodian, trustee or in other fiduciary capacities, that result in its
+holding or placing of assets on behalf of individuals, securities investment funds, social
+security funds, insurance companies, qualified foreign institutional investors, annuity
+schemes and other customers. These assets are not included in the statement of financial
+position of the Group, as they are not assets of the Group.
+The Group also administers entrusted loans on behalf of third-party lenders. In this regard,
+the Group grants loans to borrowers, as an intermediary, at the direction of third-party
+lenders, who fund these loans. The Group has been contracted by these third-party lenders
+to manage the administration and collection of these loans on their behalf. The third-party
+lenders determine both the underwriting criteria for and all terms of the entrusted loans,
+including their purposes, amounts, interest rates, and repayment schedules. The Group
+charges a commission related to its activities in connection with the entrusted loans, but
+the risk of loss is borne by the third-party lenders. Entrusted loans are not recognised in the
+statement of financial position of the Group.
+253
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+18 Interest income and expense
+19
+"Interest income” and “Interest expense" in the Group's income statement are the interest
+income and expense calculated using the effective interest method on financial assets at
+amortised cost, financial assets at fair value through other comprehensive income and
+financial liabilities at amortised cost.
+Effective interest method is used in the calculation of the amortised cost of a financial
+asset or a financial liability and in the allocation and recognition of the interest income
+or interest expense in profit or loss over the relevant period. Effective interest rate is that
+exactly discounts estimated future cash flows through the expected life of a financial asset or
+financial liability to the gross carrying amount of a financial asset or the amortised cost of a
+financial liability. When calculating effective interest rate, the Group estimates the expected
+cash flows by considering all contractual terms of the financial instrument but does not
+consider expected credit losses. The calculation includes all amounts paid or received by the
+Group that are an integral part of the effective interest rate, transaction costs and all other
+premiums or discounts.
+For those purchased or originated credit-impaired financial assets, the Group calculates the
+interest income by applying the credit-adjusted effective interest rate to the amortised cost
+of the financial asset from initial recognition. Credit-adjusted effective interest rate is that
+exactly discounts the estimated future cash flows through the expected life of the financial
+asset to the amortised cost of a financial asset that is a purchased or originated credit-
+impaired financial asset.
+For those financial assets that are not purchased or originated credit-impaired financial
+assets but subsequently have become credit-impaired financial assets, the Group calculates
+the interest income by applying the effective interest rate to the amortised cost of the
+financial asset in subsequent reporting periods.
+The Group earns fee and commission income from a diverse range of services it provides to
+its customers. For those services that are provided over a period of time, fee and commission
+income is accrued in accordance with the terms and conditions of the service agreement.
+For other services, fee and commission income is recognised when the transactions are
+completed.
+A contingent liability is a possible obligation that arises from past events and whose
+existence will only be confirmed by the occurrence or non-occurrence of one or more
+uncertain future events not wholly within the control of the Group. It can also be a present
+obligation arising from past events that is not recognised because it is not probable that
+an outflow of economic resources will be required or the amount of obligation cannot be
+measured reliably.
+FOR THE YEAR ENDED 31 DECEMBER 2021
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+The Group has taken into consideration the impact of the economic environment on the
+industries and territories in which the Group operates when determining critical accounting
+estimates and judgements in applying accounting policies.
+Areas susceptible to changes in critical estimates and judgements, which affect the carrying
+value of assets and liabilities, are set out below. It is possible that actual results may be
+materially different from the estimates and judgements referred below.
+Measurement of ECL
+The measurement of the expected credit loss allowance for financial assets measured at
+amortised cost, debt instruments measured at FVOCI and loan commitments and financial
+guarantee contracts is an area that requires the use of complex models and significant
+assumptions about future economic conditions and credit behaviour (the likelihood of
+customers defaulting and the resulting losses).
+A number of significant judgements are required in applying the accounting requirements
+for measuring ECL, such as:
+•
+•
+The Group assesses assumptions and estimates used in valuation techniques including
+review of valuation model assumptions and characteristics, changes to model assumptions,
+the quality of market data, whether markets are active or inactive, other fair value
+adjustments not specifically captured by models and consistency of application of
+techniques between reporting periods as part of its normal review and approval processes.
+Valuation techniques are validated and periodically reviewed and, where appropriate, have
+been updated to reflect market conditions at the financial reporting date.
+•
+Segmentation of portfolios sharing similar credit risk characteristics for the purposes of
+measuring ECL;
+Selection of appropriate models and assumptions for the measurement of ECL;
+Determination of criteria for determining significant increases in credit risk, default
+and credit-impaired financial assets;
+Economic indicators for forward-looking measurement, and the application of
+economic scenarios and weightings for different types of products; and
+Estimation of future cash flows for impaired loans and advances to customers where
+ECL is being assessed individually.
+Refer to Note VI.2.3 measurement of ECL for the description of the parameters,
+assumptions and estimation techniques used in measuring the ECL.
+The accounting estimates and judgements made by the Group will generally affect
+the carrying amounts of assets and liabilities of the next financial year. Estimates and
+judgements are continually evaluated and are based on historical experience and other
+factors, including expectations of future events that are believed to be reasonable under the
+circumstances.
+(Amount in millions of Renminbi, unless otherwise stated)
+1
+(Amount in millions of Renminbi, unless otherwise stated)
+20 Income taxes (Continued)
+20.2 Deferred income tax (Continued)
+Deferred income tax liabilities on taxable temporary differences arising from investments
+in subsidiaries, associates and joint ventures are recognised, except where the timing of the
+reversal of the temporary difference can be controlled and it is probable that the difference
+will not reverse in the foreseeable future.
+The tax effects of income tax losses available for carrying forward are recognised as an asset
+when it is probable that future taxable profits will be available against which these losses
+can be utilised.
+Deferred income tax assets and liabilities are offset when there is a legally enforceable right
+to offset current tax assets against current tax liabilities and when the deferred income taxes
+are related to the same fiscal authority.
+21
+Segment reporting
+The Group reviews the internal reporting in order to assess performance and allocate
+resources. Segment information is presented on the same basis as the Group's management
+and internal reporting.
+22
+Comparative figures
+Certain comparative figures have been adjusted to conform with changes in disclosures in
+current year.
+256
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+III CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS IN APPLYING
+ACCOUNTING POLICIES
+257
+17
+Perpetual bonds issued by the Group contain no contractual obligation to deliver cash or
+another financial asset; or to exchange financial assets or financial liabilities with another
+entity under conditions that are potentially unfavourable to the Group. Perpetual bonds
+issued include no terms and arrangements that the bonds must or will alternatively be
+settled in the Group's own equity instruments. The Group classifies perpetual bonds issued
+as an equity instrument. Fees, commissions and other transaction costs of perpetual bonds
+issuance are deducted from equity. Interest on perpetual bonds is recognised as profit
+distribution at the time of declaration.
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+13 Provisions
+Provisions are recognised when: the Group has a present legal or constructive obligation
+as a result of past events, it is probable that an outflow of resources embodying economic
+benefits will be required to settle the obligation, and a reliable estimate of the amount of the
+obligation can be made. The amount initially recognised as a provision should be the best
+estimate of the expenditure required to settle the present obligation.
+14 Insurance contracts
+259
+When estimating the value in use of aircraft held by the subsidiary, the Group estimates
+expected future cash flows from the aircraft and uses a suitable discount rate to calculate
+present value. The Group obtains valuations of aircraft from independent appraisers for
+which the principal assumptions underlying aircraft value are based on current market
+transactions for similar aircraft in the same location and condition. The Group also uses
+the fair value of aircraft obtained from independent appraisers in its assessment of the
+recoverable amount of intangible assets and the goodwill arising from the purchase of the
+Group's aircraft leasing subsidiary.
+Non-financial assets are periodically reviewed for impairment and where the carrying
+amount of an asset is greater than its estimated recoverable amount, it is written down
+immediately to its recoverable amount. Recoverable amount is the higher of the asset's fair
+value less costs to sell and value in use.
+Impairment of non-financial assets
+Where the final tax outcome of these matters is different from the amounts that were initially
+estimated, such differences will impact the current income tax, deferred income tax, and
+value-added tax in the period during which such a determination is made.
+The Group is subject to income, value-added and other taxes in numerous jurisdictions,
+principally in Chinese mainland and Hong Kong (China). During the ordinary course of
+business, there are certain transactions and activities for which the final tax treatment is
+uncertain. The Group takes into account the existing tax legislations and past practice in
+determining the tax estimates.
+Taxes
+As described in Note II.12.2 and Note V.33, the Bank has established liabilities in
+connection with benefits payable to certain retired and early retired employees. These
+liabilities are calculated using actuarial assumptions such as discount rates, pension benefit
+inflation rates, medical benefit inflation rates, and other factors. While management
+believes that its assumptions are appropriate, differences in actual experience or changes
+in assumptions may affect other comprehensive income, expenses and employee retirement
+benefit obligations.
+Employee retirement benefit obligations
+5
+FOR THE YEAR ENDED 31 DECEMBER 2021
+4
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+250
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+12 Employee benefits (Continued)
+12.4 Share-based compensation
+(1) Equity-settled share-based compensation schemes
+Fair value of the employee services received in exchange for the grant of the options under
+these schemes is recognised as an expense over the vesting period, with a corresponding
+increase in equity. Total amount to be expensed over the vesting period is determined by
+reference to the fair value of the options granted, excluding the impact of any non-market
+vesting conditions. Fair value of the equity instruments is measured at the grant date and is
+not subsequently re-measured. Non-market vesting conditions are included in assumptions
+about the number of options that are expected to become exercisable. At each financial
+reporting date, the Group revises its estimates of the number of options that are expected
+to become exercisable. It recognises the impact of the revision of original estimates, if any,
+as "Operating expenses" in the income statement over the remaining vesting period, with a
+corresponding adjustment to "Capital reserve".
+The proceeds received net of any directly attributable transaction costs are credited to "Share
+capital" (nominal value) and "Capital reserve" when the options are exercised.
+(2) Cash-settled share-based compensation schemes
+The related cost of services received from the employees and the liability to pay for such
+services are measured at fair value and recognised over the vesting period as the employees
+render services. Fair value is established at the grant date, re-measured at each financial
+reporting date with any changes in fair value recognised as “Operating expenses" in the
+income statement for the period and derecognised when the liability is settled.
+The total amount to be expensed over the vesting period is determined by reference to the
+fair value of the rights granted, excluding the impact of any non-market vesting conditions.
+Non-market conditions are included in the assumptions about the number of rights that are
+expected to vest. At each financial reporting date, the Group revises its estimates of the
+number of rights that are expected to vest. It recognises the impact of the revision to original
+estimates, if any, as “Operating expenses” in the income statement, with a corresponding
+adjustment to liability.
+12.5 Bonus plans
+The Group recognises a liability and an expense for bonuses, taking into consideration
+its business performance and profit attributable to the Bank's equity holders. The Group
+recognises a liability where contractually obliged or where there is a past practice that has
+created a constructive obligation.
+BANK OF CHINA LIMITED
+16 Contingent liabilities
+III CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS IN APPLYING
+ACCOUNTING POLICIES (Continued)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+14.2 Insurance contracts recognition and measurement (Continued)
+(2) Life insurance contracts
+Premiums on life insurance contracts are recognised as revenue when they become payable
+by the contract holders. Benefits and claims are recorded as an expense when they are
+incurred. A liability for contractual benefits that are expected to be incurred in the future
+is recorded when premiums are recognised. For certain long-term insurance contracts
+(investment-linked long-term insurance contracts) with embedded derivatives linking
+payments on the contract to units of an investment fund set up by the Group with the
+consideration received from the contract holders, the liability is adjusted for all changes
+in the fair value of the underlying assets, and includes a liability for contractual benefits
+that are expected to be incurred in the future which is recorded when the premiums are
+recognised.
+14.3 Liability adequacy test
+15
+At each financial reporting date, liability adequacy tests are performed to ensure the
+adequacy of the insurance contract liabilities (including unearned premium in the case of
+non-life insurance contracts). In performing these tests, current best estimates of future
+contractual cash flows and claims handling and administration expenses, as well as
+investment income from the assets backing such liabilities, are used. Any deficiency is
+immediately charged to the income statement and reported as “Operating expenses", with a
+provision established for losses arising from the liability adequacy test.
+Preference shares and perpetual bonds
+Preference shares issued by the Group contain no contractual obligation to deliver cash
+or another financial asset; or to exchange financial assets or financial liabilities with
+another entity under conditions that are potentially unfavourable to the Group. Preference
+shares issued are non-derivative instruments that will be settled in the Group's own equity
+instruments, but includes no contractual obligation for the Group to deliver a variable
+number of its own equity instruments. The Group classifies preference shares issued as
+an equity instrument. Fees, commissions and other transaction costs of preference shares
+issuance are deducted from equity. Dividends on preference shares are recognised as profit
+distribution at the time of declaration.
+252
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+15 Preference shares and perpetual bonds (Continued)
+14 Insurance contracts (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+II SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Continued)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+258
+The Group uses judgement to assess whether the Group has a present legal or constructive
+obligation as a result of past events at each financial reporting date, and judgement is used
+to determine if it is probable that an outflow of resources embodying economic benefits will
+be required to settle the obligation, and to determine a reliable estimate of the amount of the
+obligation and relevant disclosure in the consolidated financial statements.
+Provisions
+With respect to the PRC government obligations related to large policy-directed financing
+transactions, fair value is determined using the stated terms of the related instrument and
+with reference to terms determined by the PRC government in similar transactions engaged
+in or directed by the PRC government. In this regard, there are no other relevant market
+prices or yields reflecting arm's length transactions of a comparable size and tenor.
+14.1 Insurance contracts classification
+The Group's insurance subsidiaries issue insurance contracts that transfer significant
+insurance risk. The Group performs a significant insurance risk test at the contract initial
+recognition date. Insurance risk is significant if, and only if, an insured event could cause
+an insurer to pay significant additional benefits in any scenario, excluding scenarios that
+lack commercial substance. The Group's insurance subsidiaries issue non-life insurance
+contracts, which cover casualty and property insurance risk, and life insurance contracts,
+which insure events associated with human life (for example death, or survival) over a long
+duration.
+The Group does not separately measure embedded derivatives that itself meet the definition
+of an insurance contract or options to surrender insurance contracts for a fixed amount (or an
+amount based on a fixed amount and an interest rate).
+14.2 Insurance contracts recognition and measurement
+(1) Non-life insurance contracts
+Premiums on non-life insurance contracts are recognised as revenue (earned premiums)
+proportionally over the period of coverage. The portion of premium received on in-force
+contracts that relates to unexpired risks at the financial reporting date is reported as the
+unearned premium liability in "Other liabilities”. Claims and loss adjustment expenses
+are charged to the income statement as “Operating expenses” when incurred based on the
+estimated liability for compensation owed to contract holders or third parties damaged by
+the contract holders. They include direct and indirect claims settlement costs and arise from
+events that have occurred up to the financial reporting date even if they have not yet been
+reported to the Group.
+251
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(Amount in millions of Renminbi, unless otherwise stated)
+BANK OF CHINA LIMITED
+255
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+III CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS IN APPLYING
+ACCOUNTING POLICIES (Continued)
+2
+Fair value of financial instruments
+3
+The Group establishes fair value of financial instruments with reference to a quoted market
+price in an active market or, if there is no active market, using valuation techniques. These
+valuation techniques include the use of recent arm's length transactions, observable prices
+for similar instruments, discounted cash flow analysis using risk-adjusted interest rates, and
+commonly used market pricing models. Whenever possible these models use observable
+market inputs and data including, for example, interest rate yield curves, foreign currency
+rates and option volatilities. The results of using valuation techniques are calibrated against
+the industry practice and observable current market transactions in the same or similar
+instruments.
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+2
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+425,142
+BANK OF CHINA LIMITED
+415,918
+Net fee and commission income
+261
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Year ended 31 December
+Net gains from interest rate products
+3,968
+4,007
+Net interest income
+13,065
+5,551
+Net gains from fund investments and equity products
+10,322
+5,057
+Net gains/(losses) from commodity products
+936
+(6,560)
+2021
+(344,152)
+(42,300)
+Subtotal
+Interest expense
+Due to customers
+(263,599)
+(258,439)
+Fee and commission expense
+(13,027)
+(13,118)
+Net fee and commission income
+81,426
+75,522
+3
+(364,346)
+Net trading gains
+2021
+2020
+Net gains from foreign exchange and
+foreign exchange products
+Due to and placements from banks and
+other financial institutions
+(58,447)
+(49,419)
+Bonds issued and other
+Total (1)
+(36,294)
+Year ended 31 December
+28,291
+262
+(1)
+Aircraft leasing income
+12,021
+12,300
+Revenue from sale of precious metals products
+10,004
+6,749
+Dividend income (2)
+6,881
+5,601
+Gains on disposal of property and equipment,
+intangible assets and other assets
+976
+1,394
+Changes in fair value of investment properties
+(Note V.21)
+(427)
+(1,505)
+Gains on disposal of subsidiaries, associates
+and joint ventures
+992
+202
+Other
+4,187
+4,188
+Total
+29,676
+8,055
+33,027
+2020
+Included in "Net trading gains" above for the year ended 31 December 2021 were losses of RMB348
+million in relation to financial assets and financial liabilities designated as at fair value through profit or
+loss (2020: gains of RMB1,082 million).
+760,070
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+4
+Net gains on transfers of financial asset
+Net gains on derecognition of financial assets at
+fair value through other comprehensive income
+Net gains on derecognition of financial assets
+at amortised cost (1)
+Total
+Year ended 31 December
+2021
+2020
+2,109
+7,987
+1,088
+1,560
+3,197
+9,547
+(1) All the net gains on the derecognition of financial assets at amortised cost result from disposals during the
+year ended 31 December 2021 and 2020.
+5
+Other operating income
+Year ended 31 December
+2021
+Insurance premiums (¹)
+789,488
+other financial institutions and central banks
+59,163
+(1) Details of insurance premium income are as follows:
+Other operating income (Continued)
+5
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Agency commissions
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+58,605
+(2)
+BANK OF CHINA LIMITED
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+III CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS IN APPLYING
+ACCOUNTING POLICIES (Continued)
+7
+Judgement in assessing control over structured entities
+The Group is involved with structured entities in its normal business course, and the Group
+determines whether or not to consolidate those structured entities depending on whether the
+Group has control over them. When assessing control over structured entities, the Group
+takes consideration of power arising from rights it directly owns or indirectly owns through
+subsidiaries (including controlled structured entities), variable returns, and the link between
+power and returns.
+Variable returns the Group is exposed to from its involvement with structured entities
+include decision makers' remuneration (such as management fees and performance-related
+fees), as well as other benefits (such as investment income, remuneration and exposure to
+loss from providing credit or liquidity support, and variable returns from transactions with
+structured entities). When assessing whether it controls a structured entity, the Group not
+only considers applicable legal or regulatory requirements, and contractual agreements, but
+also other circumstances where the Group may have obligation to absorb any loss of the
+structured entity.
+The Group reassesses whether it controls a structured entity if facts and circumstances
+indicate that there are changes to one or more of the relevant elements of control.
+IV TAXATION
+The principal income and other taxes to which the Group is subject are listed below:
+Taxes
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Year ended 31 December
+2021
+Settlement and clearing fees
+88,640
+94,453
+Fee and commission income
+8,916
+8,126
+Other
+3,535
+4,576
+Consultancy and advisory fees
+5,871
+5,520
+Spread income from foreign exchange business
+4,831
+6,400
+Custodian and other fiduciary service fees
+11,912
+11,868
+Credit commitment fees
+13,825
+12,717
+14,383
+15,371
+25,367
+29,875
+Bank card fees
+Chinese mainland
+Subtotal
+Tax basis
+Corporate income tax
+Loans and advances to customers
+581,000
+550,354
+Corporate loans and advances
+- Personal loans
+Discounted bills
+Financial investments
+309,436
+299,190
+263,651
+241,907
+Interest income
+7,913
+153,859
+150,553
+Financial assets at fair value through
+other comprehensive income
+53,550
+55,723
+Financial assets at amortised cost
+100,309
+94,830
+Due from and placements with and loans to banks and
+54,629
+9,257
+2020
+Year ended 31 December
+2021
+Net interest income
+Taxable income
+25%
+Value-added tax
+Education surcharges
+Taxable added value
+6%
+City construction and maintenance tax
+Turnover tax paid
+1%-7%
+Turnover tax paid
+3%
+Local education surcharges
+Turnover tax paid
+2%
+Hong Kong (China)
+Hong Kong (China) profits tax
+Assessable profits
+16.5%
+260
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+1
+Statutory rates
+2020
+50
+269
+50
+50(3)
+LENG Jie
+8
+8(3)
+ZHOU Hehua (5)
+8
+8(3)
+(5)
+WEI Hanguang
+821
+85
+117
+619
+ZHANG Keqiu (4)(5)
+Supervisors
+450
+500
+450
+600
+450
+JIA Xiangsen
+600
+260
+ZHENG Zhiguang
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+266
+7,605
+415
+564
+2,919
+3,707
+46
+46(3)
+LI Changlin (6)
+25
+25(3)
+WANG Zhiheng (6)
+68
+7
+10
+51
+WANG Xiquan (4)(6)
+260
+260
+260
+FOR THE YEAR ENDED 31 DECEMBER 2021
+450
+500
+111
+557
+_(2)
+616
+63
+88
+465
+_(2)
+821
+85
+117
+619
+_(2)
+WANG Changyun
+Independent directors
+Non-executive directors
+XIAO Lihong (1)
+WANG Xiaoya (1)
+ZHANG Jiangang (1)
+CHEN Jianbo (1)
+ZHAO Jie (1)(6)
+LIN Jingzhen (4)
+WANG Jiang (4)(6)
+WANG Wei (4)
+LIU Jin (4)(5)
+LIU Liange (4)
+Executive directors
+84
+CHUI Sai Peng Jose
+752
+557
+CHEN Chunhua
+| | | |
+| | | |
+| | | |
+| | | |
+600
+|||||
+450
+Martin Cheung Kong LIAO
+600
+JIANG Guohua
+450
+Angela CHAO
+68
+7
+10
+51
+_(2)
+752
+84
+111
+-(2)
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+8 Directors', supervisors' and senior management's emoluments (Continued)
+ZHANG Keqiu (4)(5)
+Supervisors
+3,176
+CHUI Sai Peng Jose
+224
+CHEN Chunhua
+450
+Martin Cheung Kong LIAO
+609
+JIANG Guohua
+450
+Angela CHAO
+635
+| | | |
+| | | |
+||||
+||||
+WANG Changyun
+Independent directors
+ZHAO Jie (1)(6)
+LIAO Qiang (1)
+LENG Jie
+CHEN Jianbo (1)
+50(3)
+260
+968
+79
+260
+260
+50
+138
+224
+450
+609
+450
+635
+50(3)
+LI Changlin (6)
+50(3)
+WANG Zhiheng (6)
+1 1 1 1 ∞
+78
+811
+WANG Xiquan (4)(6)
+260
+ZHENG Zhiguang
+JIA Xiangsen
+ZHANG Jiangang (1)
+WANG Xiaoya (¹)
+XIAO Lihong (1)
+-(2)
+78
+811
+_(2)
+LIN Jingzhen
+WANG Wei (4)
+LIU Jin (4)(5)
+LIU Liange (4)
+Executive directors
+Total
+RMB'000
+RMB'000
+kind
+Benefits in
+to pension
+schemes
+RMB'000
+RMB'000
+RMB'000
+paid
+Fees
+Remuneration
+Contributions
+For the year ended 31 December 2020
+-(2)
+729
+74
+(4)
+Non-executive directors
+73
+968
+882
+79
+882
+79
+968
+79
+22227
+RMB'000
+5
+_(2)
+WU Fulin (4)
+79
+78
+811
+_(2)
+WANG Jiang (4)(6)
+74
+729
+-(2)
+61
+RMB'000
+Total
+kind
+Non-life insurance contracts
+23,942
+27,802
+Net insurance premium income
+(9,348)
+(9,004)
+Less: gross written premiums ceded to reinsurers
+33,290
+36,806
+Gross earned premiums
+Life insurance contracts
+2020
+3,952
+387
+402
+7,917
+267
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+Gross earned premiums
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+6,563
+Less: gross written premiums ceded to reinsurers
+Insurance benefits and claims
+38,944
+47,403
+General operating and administrative expenses (1) (2)
+89,334
+99,317
+Staff costs (Note V.7)
+2020
+2021
+Year ended 31 December
+Operating expenses
+6
+For equity instruments classified as financial assets at fair value through other comprehensive income,
+RMB616 million of dividend income is recognised for the year ended 31 December 2021 (2020: RMB507
+million).
+29,676
+33,027
+Total
+5,734
+5,225
+Net insurance premium income
+(1,219)
+(1,338)
+6,953
+8
+Directors', supervisors' and senior management's emoluments (Continued)
+(1)
+Basic salaries and allowances
+Discretionary bonuses
+18
+23
+63
+98
+Contributions to pension schemes and other
+2
+3
+Emoluments of the individuals were within the following bands:
+Amounts in RMB
+10,000,001-20,000,000
+20,000,001-30,000,000
+30,000,001-50,000,000
+83
+124
+Year ended 31 December
+2021
+2020
+The above five highest paid individuals' emoluments are based on best estimates of
+discretionary bonuses. Discretionary bonuses include portions of payments that are deferred
+to future periods.
+During the years ended 31 December 2021 and 2020, the Group has not paid any
+emoluments to the directors, supervisors, or senior management as an inducement to join or
+upon joining the Group or as compensation for loss of office.
+2020
+2021
+Year ended 31 December
+The emoluments payable to the five individuals whose emoluments were the highest in the
+Group for the years ended 31 December 2021 and 2020, respectively are as follows:
+(2)
+(3)
+(4)
+(5)
+(6)
+For the years ended 31 December 2021 and 2020, these non-executive directors of the Bank were not
+remunerated by the Bank.
+For the years ended 31 December 2021 and 2020, these executive directors of the Bank did not receive any
+fees.
+Employee supervisors' compensation presented above is paid for serving as the supervisors of the Bank.
+A portion of the discretionary bonus payments for executive directors and the Chairman of the Board of
+Supervisors are deferred for a minimum of 3 years, which is contingent upon the future performance in
+accordance with relevant regulations of the PRC authorities.
+The total compensation packages for executive directors and certain supervisors for the year ended 31
+December 2021 including discretionary bonus have not yet been finalised in accordance with the relevant
+regulations of the PRC authorities. The amount of the compensation not provided for is not expected to
+have any significant impact on the Group's 2021 financial statements. The final compensation for the year
+ended 31 December 2021 will be disclosed in a separate announcement when determined.
+- Life insurance contracts
+The compensation amounts for these directors and supervisors for the year ended 31 December 2020 were
+restated based on the finalised amounts as disclosed in the Bank's announcement on resolutions of the
+Board of Directors dated 30 August 2021.
+WANG Jiang ceased to serve as Vice-Chairman of the Board of Directors and Executive Director of the
+Bank as of 5 February 2021. ZHAO Jie ceased to serve as Non-executive Director of the Bank as of 15
+March 2022. WANG Xiquan ceased to serve as Chairman of the Board of Supervisors and Shareholder
+Supervisor of the Bank as of 18 January 2021. WANG Zhiheng ceased to serve as Employee Supervisor as
+of 24 June 2021. LI Changlin ceased to serve as Employee Supervisor as of 18 November 2021.
+268
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+8
+Directors', supervisors' and senior management's emoluments (Continued)
+Five highest paid individuals
+Of the five individuals with the highest emoluments, none of them are directors or
+supervisors whose emoluments are disclosed above.
+LIU Jin began to serve as Vice-Chairman of the Board of Directors and Executive Director of the Bank
+as of 16 June 2021. ZHANG Keqiu began to serve as Chairwoman of the Board of Supervisors and
+Shareholder Supervisor of the Bank as of 18 January 2021. WEI Hanguang and ZHOU Hehua began to
+serve as Employee Supervisor as of 18 November 2021. HUI Ping began to serve as External Supervisor as
+of 17 February 2022. Since HUI Ping did not hold any position at the Board of Supervisors of the Bank in
+2021, no emoluments were disclosed in 2021.
+50
+27,749
+Non-life insurance contracts
+29
+Reimbursement for cancellation of labour contract
+2,082
+2,052
+Labour union fee and staff education fee
+4,774
+4,940
+Housing funds
+136
+135
+Maternity insurance
+59
+81
+― Injury at work
+150
+213
+3,440
+3,527
+4,607
+6,205
+3,109
+28
+3,932
+Other
+4,304
+Benefits in
+to pension
+schemes
+RMB'000
+RMB'000
+RMB'000
+paid
+Fees
+Remuneration
+Contributions
+For the year ended 31 December 2021
+Details of the directors' and supervisors' emoluments are as follows:
+Directors', supervisors' and senior management's emoluments
+8
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+89,334
+99,317
+265
+Total
+4,674
+50
+67
+4,218
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+202,411
+226,355
+264
+Total (3)
+8,792
+8,809
+Other
+5,465
+5,715
+Taxes and surcharges
+6,424
+9,650
+Cost of sales of precious metal products
+22,871
+23,882
+Depreciation and amortisation
+4,241
+3,830
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+6
+4,664
+62,377
+68,798
+- Unemployment
+- Annuity
+- Pension
+Medical
+Social insurance
+Retirement benefits
+Staff welfare
+26,340
+Salary, bonus and subsidy
+2021
+Year ended 31 December
+Staff costs
+7
+Included in the "Operating expenses” are premises and equipment-related expenses (mainly comprised of
+property management and building maintenance expenses and taxes) of RMB12,986 million for the year
+ended 31 December 2021 (2020: RMB 12,810 million).
+Included in the "General operating and administrative expenses" are lease expenses related to short-term
+leases, leases of low-value assets and others of RMB1,404 million for the year ended 31 December 2021
+(2020: RMB 1,302 million).
+(3)
+(2)
+(1) Included in the "General operating and administrative expenses" is principal auditors' remuneration of
+RMB173 million for the year ended 31 December 2021 (2020: RMB237 million), of which RMB62 million
+is for Hong Kong (China), Macao (China), Taiwan (China) and other countries and regions of the Group
+(2020: RMB75 million).
+Operating expenses (Continued)
+2020
+138
+67,661
+263
+2,076,840
+2,228,726
+(3,780)
+695
+672
+2,076,145
+2,231,834
+Total
+Less: allowance for impairment losses
+Accrued interest
+Subtotal
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(1)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+9
+Impairment losses on assets
+Loans and advances
+Year ended 31 December
+2021
+2020
+- Loans and advances at amortised cost
+Loans and advances at fair value through
+other comprehensive income
+98,289
+Subtotal
+103,743
+9
+(113)
+(Amount in millions of Renminbi, unless otherwise stated)
+98,298
+The Group places mandatory reserve funds with the People's Bank of China (the "PBOC") and the central
+banks of Hong Kong (China), Macao (China), Taiwan (China) and other countries and regions where it has
+operations. As at 31 December 2021, mandatory reserve funds placed with the PBOC were calculated at
+10.0% (31 December 2020: 11.0%) and 9.0% (31 December 2020: 5.0%) of qualified RMB deposits and
+foreign currency deposits from customers in Chinese mainland of the Bank, respectively. The mandatory
+reserve funds placed with the central bank of domestic subsidiaries of the Group are determined by the
+PBOC. The amounts of mandatory reserve funds placed with the central banks of other jurisdictions are
+determined by local regulations.
+277
+Accrued interest
+939,376
+1,258,347
+Subtotal (1)(2)
+24,157
+67,055
+Macao (China), Taiwan (China) and
+other countries and regions
+Other financial institutions in Hong Kong (China),
+294,358
+450,817
+Banks in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions
+529,152
+589,919
+(2) These represent funds for clearing purposes and balances other than mandatory reserves placed with the
+PBOC, the central banks of Hong Kong (China), Macao (China), Taiwan (China) and other countries and
+regions.
+91,709
+Other financial institutions in Chinese mainland
+Banks in Chinese mainland
+Placements with and loans to:
+2020
+2021
+As at 31 December
+15 Placements with and loans to banks and other financial institutions
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+150,556
+3,109
+103,630
+Financial assets at amortised cost
+Year ended 31 December
+2021
+2020
+Current income tax
+- Chinese mainland income tax
+35,039
+45,296
+Hong Kong (China) profits tax
+4,348
+5,242
+Macao (China), Taiwan (China) and
+other countries and regions taxation
+3,537
+3,455
+Income tax expense
+Adjustments in respect of current income tax
+(345)
+1,557
+Subtotal
+42,579
+55,550
+Deferred income tax (Note V.35.3)
+6,702
+(14,268)
+Total
+49,281
+41,282
+The principal tax rates applicable to the Group are set out in Note IV.
+Provision for Chinese mainland income tax includes income tax based on the statutory tax
+rate of 25% of the taxable income of the Bank and each of its subsidiaries established in
+the Chinese mainland, and supplementary PRC tax on overseas operations as determined in
+accordance with the relevant PRC income tax rules and regulations.
+of prior years
+Financial investments
+10
+(Amount in millions of Renminbi, unless otherwise stated)
+721
+1,872
+- Financial assets at fair value through
+other comprehensive income
+763
+4,244
+Subtotal
+Credit commitments
+Other
+1,484
+6,116
+(3,038)
+5,454
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+6,335
+Subtotal of impairment losses on credit
+103,079
+118,381
+Other impairment losses on assets
+1,141
+635
+Total
+104,220
+119,016
+270
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+3,181
+2,429
+Less: allowance for impairment losses (2)
+(4,043)
+3,817,876
+63,772
+543
+2
+2,058
+Interest rate futures
+(135)
+136
+22,988
+Interest rate options
+(27,179)
+23,860
+4,032,069
+Interest rate swaps
+Interest rate derivatives
+32.789
+(155,221)
+6,725,394
+(56,734)
+66,169
+6,561,498
+Subtotal
+(20)
+7
+1,746
+(3)
+1
+1,250
+Currency futures
+(3,789)
+125,528
+6,921
+(42,520)
+Subtotal
+279
+The derivative financial instruments above include those designated as hedging instruments by the Group.
+(1)
+(212,052)
+171,738
+(89,151) 11,013,335
+95,799
+10,912,162
+Total(1)
+(13,886)
+13,029
+(4,979) 392,823
+5,447
+16
+288,773
+(413)
+376
+12,927
+(120)
+185
+4,776
+Equity derivatives
+(42,532)
+32,805
+3,882,191
+(27,318)
+23,998
+4,057,115
+Commodity derivatives and other
+419,338
+(4,196)
+4,996
+(2)
+230,057
+505,228
+(668)
+230,057
+505,896
+256
+6,109
+6,914
+1,222
+40,968
+182,724
+396,324
+101,436
+2020
+As at 31 December 2021 and 2020, the Group included the predominant majority of its placements with and
+loans to banks and other financial institutions under Stage 1, and measured the impairment losses based on
+expected credit losses in the next 12 months (12-month ECL).
+As at 31 December
+2021
+Less: allowance for impairment losses(2)
+Subtotal(2)
+- Corporates
+- Financial institutions
+Policy banks
+Governments
+Debt securities
+“Placements with and loans to banks and other financial institutions” include balances arising from reverse
+repo agreements and collateralised financing agreements. They are presented by collateral type as follows:
+(1)
+939,320
+1,257,413
+Total
+(2,485)
+Total
+278
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+593,654
+Currency options
+(151,412)
+118,600
+6,304,310
+(52,535)
+61,172
+5,966,594
+interest rate swaps
+cross-currency
+Currency forwards and swaps, and
+Exchange rate derivatives
+Liabilities
+Assets
+Fair value
+Contractual/
+Notional
+amount
+Liabilities
+Fair value
+Assets
+Contractual/
+Notional
+amount
+As at 31 December 2020
+As at 31 December 2021
+16.1 Derivative financial instruments
+The contractual/notional amounts and fair values of derivative instruments held by the
+Group are set out in the following tables. The contractual/notional amounts of financial
+instruments provide a basis for comparison with the fair values of instruments recognised in
+the statement of financial position but do not necessarily indicate the amounts of future cash
+flows involved or the current fair value of the instruments and, therefore, do not indicate the
+Group's exposure to credit or market risks. The derivative instruments become favourable
+(assets) or unfavourable (liabilities) as a result of fluctuations in market interest rates,
+foreign currency exchange rates, credit spreads, or equity/commodity prices relative to their
+terms. The aggregate fair values of derivative financial assets and liabilities can fluctuate
+significantly from time to time.
+The Group enters into foreign currency exchange rate, interest rate, equity, credit or precious
+metals and other commodity-related derivative financial instruments for trading, hedging,
+asset and liability management and customer initiated transactions.
+16 Derivative financial instruments and hedge accounting
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+Taxation on profits of Hong Kong (China), Macao (China), Taiwan (China) and other
+countries and regions has been calculated on the estimated assessable profits in accordance
+with local tax regulations at the rates of taxation prevailing in the countries or regions in
+which the Group operates.
+Surplus reserves and others (2)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+translation of
+comprehensive
+foreign
+income
+operations
+Other
+Total
+As at 1 January 2020
+22,534
+(6,172)
+3,251
+19,613
+Changes for the previous year
+through other
+(344)
+(675) (15,304)
+As at 1 January 2021
+22,190
+(20,457)
+2,576
+4,309
+Changes for the year
+6,700
+(9,782)
+190
+(2,892)
+As at 31 December 2021
+28,890
+(14,285)
+(30,239)
+from the
+differences
+(174)
+(2)
+44
+8
+(130)
+Exchange differences from the translation of
+foreign operations
+(12,760)
+(21,549)
+Other
+351
+(751)
+Subtotal
+(6,386)
+at fair value
+(22,322)
+(6,236)
+(22,862)
+274
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+12 Other comprehensive income (Continued)
+Other comprehensive income attributable to equity holders of the Bank in the consolidated
+statement of financial position:
+Gains/(losses)
+on financial
+assets
+Exchange
+Total
+༤༠
+2,766
+275
+585,000
+721,076
+1,835
+4,327
+(1,537)
+(1,083)
+Subtotal due from banks and other financial institutions
+585,298
+724,320
+Total
+644,816
+803,145
+(1)
+Less: allowance for impairment losses (¹)
+As at 31 December 2021 and 2020, the Group included the predominant majority of due from banks and
+other financial institutions under Stage 1, and measured the impairment losses based on expected credit
+losses in the next 12 months (12-month ECL).
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+14 Balances with central banks
+As at 31 December
+2021
+2020
+Mandatory reserves (1)
+1,478,465
+1,442,384
+276
+1,417
+Accrued interest
+559
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+633,761
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+13 Cash and due from banks and other financial institutions
+Cash
+As at 31 December
+2021
+2020
+59,518
+78,825
+Subtotal(¹)
+Due from banks in Chinese mainland
+602,340
+Due from other financial institutions
+in Chinese mainland
+8,709
+7,515
+Due from banks in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions
+110,948
+110,662
+Due from other financial institutions in
+Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions
+926
+464,417
+Less: related income tax impact
+10
+joint ventures accounted for using the equity method
+Income tax expense
+49,281
+41,282
+(1)
+(2)
+Income not subject to tax mainly comprises interest income from PRC treasury bonds and Chinese local
+government bonds, and tax-free income recognised by the overseas entities in accordance with the relevant
+local tax law.
+Non-deductible items primarily include non-deductible losses resulting from the write-off of certain non-
+performing loans, and marketing and entertainment expenses in excess of the relevant deductible threshold
+under the relevant PRC tax regulations.
+272
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+(394)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Earnings per share (basic and diluted)
+Basic earnings per share was computed by dividing the profit attributable to the ordinary
+shareholders of the Bank by the weighted average number of ordinary shares in issue during
+the period.
+Diluted earnings per share was computed by dividing the adjusted profit attributable to the
+ordinary shareholders of the Bank based on assuming conversion of all potentially dilutive
+shares for the period by the adjusted weighted average number of ordinary shares in issue.
+There was no difference between basic and diluted earnings per share as there were no
+potentially dilutive shares outstanding for the years ended 31 December 2021 and 2020.
+Year ended 31 December
+2021
+2020
+Profit attributable to equity holders of the Bank
+Less: dividends/interest on preference shares/
+perpetual bonds declared
+216,559
+192,870
+(10,651)
+(12,029)
+Profit attributable to ordinary shareholders of the Bank
+205,908
+11
+180,841
+(1,165)
+11,226
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+10
+Income tax expense (Continued)
+The tax rate on the Group's profit before income tax differs from the theoretical amount that
+would arise using the basic Chinese mainland tax rate of the Bank as follows:
+Profit before income tax
+Year ended 31 December
+2021
+2020
+276,620
+246,378
+Tax calculated at the basic Chinese mainland tax rate
+Effect of different tax rates for Hong Kong (China),
+Other
+69,155
+Macao (China), Taiwan (China) and other countries
+and regions
+(4,337)
+(4,278)
+Supplementary PRC tax on overseas income
+2,927
+2,924
+Income not subject to tax
+(1)
+(29,556)
+(29,791)
+Items not deductible for tax purposes (2)
+12,257
+61,595
+Weighted average number of ordinary shares in issue
+(in million shares)
+294,379
+294,381
+10
+150
+(540)
+Items that may be reclassified to profit or loss
+Changes in fair value on debt instruments measured at
+fair value through other comprehensive income
+8,412
+3,950
+Less: related income tax impact
+(1,557)
+(742)
+Amount transferred to the income statement
+(1,687)
+(7,711)
+83
+Less: related income tax impact
+1,527
+5,444
+(2,976)
+Allowance for credit losses on debt instruments
+measured at fair value through other
+comprehensive income
+Less: related income tax impact
+761
+(190)
+4,108
+(1,024)
+571
+3,084
+Share of other comprehensive income of associates and
+276
+(622)
+(29)
+335
+(185)
+101
+Basic and diluted earnings per share (in RMB)
+0.70
+0.61
+Weighted average number of ordinary shares in issue (in million shares)
+Year ended 31 December
+2021
+2020
+Issued ordinary shares as at 1 January
+294,388
+294,388
+Less: weighted average number of treasury shares
+(7)
+Weighted average number of ordinary shares in issue
+294,379
+294,381
+273
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+12
+Other comprehensive income
+Items that will not be reclassified to profit or loss
+Actuarial (losses)/gains on defined benefit plans
+Changes in fair value on equity instruments designated
+at fair value through other comprehensive income
+Less: related income tax impact
+Other
+Subtotal
+Year ended 31 December
+2021
+2020
+(83)
+BANK OF CHINA LIMITED
+271
+753,369
+years
+N/A
+Average exchange rate of
+USD/TWD
+-- 26.9425
+N/A
+Average exchange rate of
+-- 298.2472
+USD/RUB
+N/A
+287
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+78.2517
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+USD/HUF
+N/A
+- 15.3221
+N/A
+USD/INR
+- 77.6566
+N/A
+Average exchange rate of
+USD/MXN
+Average exchange rate of
+-- 21.4996
+Average exchange rate of
+USD/CLP
+- 845.0014
+N/A
+Average exchange rate of
+USD/PEN
+-- 3.7309
+N/A
+Average exchange rate of
+16 Derivative financial instruments and hedge accounting (Continued)
+(2) Net investment hedges (Continued)
+3,966
+Average exchange rate of
+USD/BRL
+5.2086
+N/A
+Average exchange rate of
+USD/ZAR
+2,010
+17.5600
+N/A
+Average exchange rate of
+USD/INR
+79.2094
+N/A
+Average exchange rate of
+16.9743
+16.2 Hedge accounting (Continued)
+1,956
+swap contracts
+(ii) The following table contains details of the derivative hedging instruments used in the
+Group's net investment hedging strategies (Continued):
+Net investment hedges
+Between
+1 and 5
+Between
+Less than
+1 month
+1 and 3
+months
+Notional amount
+Between
+3 and 12
+months
+years
+5 years
+Total
+As at 31 December 2020
+Foreign exchange risk
+Foreign exchange forward and
+Over
+USD/MXN
+USD/ZAR
+USD/BRL
+6,946
+292
+(26)
+As at 31 December 2020
+Foreign exchange
+forward and
+Total
+Derivative financial
+3,966
+12
+(360)
+assets/liabilities
+Total
+3,966
+swap contracts
+12
+assets/liabilities
+292
+As at 31 December 2021
+Derivatives designated as
+net investment hedging instruments
+Contractual/
+Line item in the
+Notional
+amount
+(26)
+Fair value
+Assets Liabilities
+financial position
+Foreign exchange
+forward and
+Derivative financial
+swap contracts
+6,946
+statement of
+Average exchange rate of
+(360)
+BANK OF CHINA LIMITED
+Less than
+1 month
+1 and 3
+months
+Between
+3 and 12
+months
+1 and 5
+Over
+Between
+5 years
+6,946
+6,946
+Average exchange rate of
+-- 5.51
+5.5165
+N/A
+Total
+286
+Between
+Notional amount
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+16 Derivative financial instruments and hedge accounting (Continued)
+Net investment hedges
+16.2 Hedge accounting (Continued)
+(ii) The following table contains details of the derivative hedging instruments used in the
+Group's net investment hedging strategies (Continued):
+The following table sets out the maturity and average exchange rate of the hedging
+instruments mentioned above:
+As at 31 December 2021
+Foreign exchange risk
+Foreign exchange forward and
+swap contracts
+(2) Net investment hedges (Continued)
+(ii) The following table contains details of the derivative hedging instruments used in the
+Group's net investment hedging strategies:
+21.9108
+Average exchange rate of
+hedging instruments in fair value hedges
+As at 31 December 2020
+Interest rate risk
+Interest rate swaps
+Foreign exchange and
+Cross-currency interest
+Derivatives designated as
+interest rate risk
+Total
+Contractual/
+Notional
+amount
+Fair value
+Assets Liabilities
+Line item in the
+statement of
+financial position
+rate swaps
+Derivative
+(i) The following table contains details of the derivative hedging instruments used in the
+Group's fair value hedging strategies (Continued):
+16.2 Hedge accounting (Continued)
+625
+(24)
+liabilities
+108,222
+685
+(2,178)
+(1) Fair value hedges (Continued)
+280
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+16 Derivative financial instruments and hedge accounting (Continued)
+BANK OF CHINA LIMITED
+Derivative
+financial
+240
+(1) Fair value hedges (Continued)
+(i) The following table contains details of the derivative hedging instruments used in the
+Group's fair value hedging strategies (Continued):
+The following table sets out the maturity and average exchange rate/interest rate information
+of the hedging instruments mentioned above:
+Less than
+1 month
+Fair value hedges
+Between Between Between
+16.2 Hedge accounting (Continued)
+1 and 3 3 and 12 1 and 5 Over 5
+months months
+years
+Total
+As at 31 December 2021
+Interest rate risk
+Interest rate swaps
+Notional amount
+Average fixed
+years
+100,936
+16 Derivative financial instruments and hedge accounting (Continued)
+V
+(5,216)
+assets/liabilities
+Derivative
+1,852
+(206)
+liabilities
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+102,788
+(5,422)
+281
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+240
+N/A
+assets/liabilities
+107,597
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+16 Derivative financial instruments and hedge accounting (Continued)
+16.2 Hedge accounting (Continued)
+(2) Net investment hedges (Continued)
+(iii) The Group's gains or losses from the hedging instruments recognised in "Other
+comprehensive income" on net investment hedges are as follows:
+Year ended 31 December
+V
+2021
+Amounts of fair value changes on
+hedging instruments recognised in
+"Other comprehensive income"
+6,740
+3,841
+Amounts of forward element reclassified from
+2020
+"Other comprehensive income" to
+profit or loss
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+NZD/USD
+0.5928
+N/A
+Average exchange rate of
+USD/CLP
+778.3973
+FOR THE YEAR ENDED 31 DECEMBER 2021
+N/A
+USD/PEN
+3.5505
+3.5110
+N/A
+288
+BANK OF CHINA LIMITED
+Average exchange rate of
+685 (2,154)
+98
+Net amounts of fair value changes on
+Foreign exchange and
+interest rate risk
+rate swaps
+Cross-currency interest
+Total
+Derivatives designated as
+Interest rate swaps
+hedging instruments in fair value hedges
+Line item in the
+Notional
+amount
+Fair value
+Assets Liabilities
+statement of
+financial position
+Derivative
+financial
+Contractual/
+154
+Interest rate risk
+(i) The following table contains details of the derivative hedging instruments used in the
+Group's fair value hedging strategies:
+hedging instruments recognised in
+"Other comprehensive income"
+6,838
+3,995
+289
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+As at 31 December 2021
+FOR THE YEAR ENDED 31 DECEMBER 2021
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+16 Derivative financial instruments and hedge accounting (Continued)
+16.2 Hedge accounting
+(1) Fair value hedges
+The Group uses cross-currency interest rate swaps and interest rate swaps to hedge against
+changes in fair value of “Financial investments”, “Due to central banks” and “Bonds issued"
+arising from changes in foreign currency exchange rates and interest rates. Foreign currency
+exchange rate risk and interest rate risk are usually the primary risks which affect the change
+in fair value.
+(Amount in millions of Renminbi, unless otherwise stated)
+As at 31 December 2021, the carrying value of such due to customers amounted to
+RMB50,273 million (31 December 2020: RMB53,087 million) and due to central banks
+amounted to RMB762 million (31 December 2020: RMB1,060 million).
+V
+(2) Net investment hedges (Continued)
+Average fixed
+Notional amount
+rate swaps
+Cross-currency interest
+interest rate risk
+Foreign exchange and
+N/A
+2.99%
+2.90%
+2.12% 2.37%
+2.87%
+interest rate
+Average fixed
+31,598 100,936
+59,013
+7,054
+1,693
+1,578
+Interest rate swaps
+Notional amount
+interest rate
+Interest rate risk
+Average exchange
+Average exchange
+16 Derivative financial instruments and hedge accounting (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+283
+N/A
+0.9294
+N/A
+--- 6.1217 -
+N/A
+5.11%
+5.38%
+1,852
+640
+1,212
+rate of AUD/USD
+rate of USD/CNY
+16.2 Hedge accounting (Continued)
+Total
+years
+interest rate
+Average fixed
+625
+317
+308
+Notional amount
+rate swaps
+Cross-currency interest
+interest rate risk
+Foreign exchange and
+N/A
+2.99% 3.33% 3.04% 2.87%
+3.23%
+interest rate
+34,430 107,597
+9,438 56,999
+5,493
+1,237
+(i) Details of due to customers and due to central banks used in the Group's net investment
+hedging strategies:
+Average exchange
+years
+rate of USD/CNY
+N/A
+Over 5
+3 and 12 1 and 5
+months
+1 and 3
+months
+Less than
+1 month
+As at 31 December 2020
+Between Between Between
+Fair value hedges
+(i) The following table contains details of the derivative hedging instruments used in the
+Group's fair value hedging strategies (Continued):
+16.2 Hedge accounting (Continued)
+16 Derivative financial instruments and hedge accounting (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+282
+N/A
+6.2110 6.0350
+-- 4.70% 5.50%
+(1) Fair value hedges (Continued)
+(1) Fair value hedges (Continued)
+As at 31 December 2021
+Year ended 31 December
+(iii) The Group's net gains on fair value hedges are as follows:
+(1) Fair value hedges (Continued)
+16.2 Hedge accounting (Continued)
+16 Derivative financial instruments and hedge accounting (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+284
+96
+5,503
+(9,093)
+100.228
+(1,647)
+Bonds issued
+206
+2021
+Total
+2020
+- hedging instruments
+16.2 Hedge accounting (Continued)
+(ii) The following table sets out the details of the hedged items covered by the Group's fair
+value hedging strategies:
+16 Derivative financial instruments and hedge accounting (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+285
+The Group's consolidated statement of financial position is affected by exchange differences
+between the functional currencies of the Group and functional currencies of its branches
+and subsidiaries. The Group hedges such exchange exposures only in limited circumstances.
+Hedging is undertaken using due to customers, due to central banks and foreign exchange
+forward and swap contracts in the same or exchange-rate pegged currencies as the functional
+currencies of the related branches and subsidiaries which are accounted for as hedges of
+certain net investments in foreign operations. Under the hedging relationships of designating
+due to customers, due to central banks and foreign exchange forward and swap contracts
+as hedging instruments, the Group separates the forward element and the spot element of a
+forward contract and designates as the hedging instrument only the change in the value of
+the spot element of the forward contract. There was no ineffectiveness for the year ended 31
+December 2021 (2020: Nil).
+(2) Net investment hedges
+193
+(114)
+Ineffectiveness recognised in net trading gains
+3,036
+(3,250)
+(2,843)
+3,136
+Net gains on
+Bonds issued
+- hedged items
+Foreign exchange and
+116
+central banks
+14
+Due to
+Financial
+investments
+As at 31 December 2020
+Total
+interest rate risk
+Foreign exchange and
+Bonds issued
+(2,523)
+(4,458)
+2,561
+103,502
+Financial investments
+Line item in
+the statement
+of financial
+position
+Accumulated amount of
+fair value adjustments
+on the hedged items
+Assets Liabilities
+Fair value hedges
+interest rate risk
+Interest rate risk
+Carrying amount of
+hedged items
+Assets Liabilities
+Due to central banks
+Bonds issued
+24
+Bonds issued
+(600)
+Bonds issued
+(113)
+(4,711)
+Bonds issued
+central banks
+3
+(2,735)
+Due to central banks
+Bonds issued
+Due to
+5,503
+100,228
+Financial
+investments
+103,502
+(7,581)
+Financial investments
+Interest rate risk
+154
+2,561
+51.059
+5,237,687
+150,553
+2.94% 4,850,972
+(20,413)
+3.96%
+581,000
+153,859
+3.83% 13,883,933
+3.10%
+550.354
+30,646
+11,988
+54,629
+3,306
+Balances with central banks
+and due from and placements with
+banks and other financial institutions
+3,860,706
+1.42% 3,726,838
+(4,534)
+(6,663)
+Investments
+59,163
+2,129
+1.59%
+(8,682)
+15,173,295
+We accelerated product innovation and created better customer experience. A front runner
+in promoting e-CNY and its use cases, we expanded our platform to cover 34% of all activated
+use scenarios and 36% of the total merchants; both are the highest among all operators. We
+launched the 7.0 version of our mobile banking APP, which drove up our monthly active users
+by 17.8%; at the same time, the number of our corporate customers using online banking and
+mobile banking services increased by 24% and 113.85% respectively. We issued the world's first
+biodiversity-themed bonds and introduced many other innovative green financial instruments. We
+also brought online a public service platform of mutual aid for the elderly, and worked with over
+70 governmental agencies, nursing homes, enterprises or social organisations, to help build an
+elderly-friendly society.
+Interest-earning assets
+22
+22
+LIU Jin
+President
+Total
+29 March 2022
+For over a century, Bank of China has bridged China and the world for the common good - a
+commitment that we still share and a noble cause that we're so proud to carry on to this day and
+onwards. And I will, together with all other members of the senior management of the Bank,
+continue to be guided by the policies of the CPC Central Committee and the State Council,
+faithfully fulfill the resolutions by the Board of Directors, and subject ourselves to the scrutiny
+of the Board of Supervisors. We will adhere to the highest ethical and professional codes, and act
+with the diligence, enterprise and ingenuity expected of us, to lead the efforts to build ourselves
+into a first-class global banking group that in turn, will deliver enhanced returns and create
+greater social values for all our customers, investors and stakeholders, whose support and trust we
+are grateful for.
+We will promote the synergy between domestic commercial banking and our globalised
+operations and diversified business platforms. Defined as the "mainstay" of our business,
+our commercial banking in the home market will be further enhanced to play a bigger role in
+attracting investment and resources worldwide. We will also serve and coordinate both "high-
+quality bringing-in” and “high-level going-global", and improve the interactions between our
+commercial and investment banking arms both at home and abroad. In doing so, we hope that
+we could provide our global customers with a one-stop and full package of financial services.
+We will invest heavily in the "Eight Priority Areas" by perfecting service modes and systems,
+with special attention on new growth drivers, new business forms, and new service scenarios,
+so as to lead a new path of high-quality development that suits us in the "blue ocean" of brand
+new opportunities in the economy. We will further accelerate digital transformation, starting
+with our internal systems. The new enterprise architecture that we are building will enable us
+to have more powerful middle offices for business, data, technology and operation, and drive
+self-evolution of operation and management. We will also use this opportunity to integrate
+and optimise business processes, make risk control more intelligent and effective, and reduce
+unproductive workload of staff and institutions to boost efficiency. Externally, we will empower
+our partners, upgrade the supply chain with digital financial services, and promote transitions
+of industries with open and shared services. We will double down on comprehensive risk
+management. By building our own core competence of risk control, we will move towards an
+"all-inclusive, coordinated, digitalised, and professional” risk management system. We will speed
+up building and applying the intelligent risk control centers, with greater emphasis on credit and
+market risks. We will also continue to promote internal control and precautionary measures, as
+well as the long-effect mechanism for anti-money laundering and compliance, to ensure stable
+and healthy operation.
+21
+Not long ago, Bank of China celebrated its 110th anniversary. Our long legacy of success and
+excellence has provided us with renewed commitment and confidence on the new journey
+ahead, where we will go on to serve the real economy and help people in their pursuit of a
+better life. We will carry forward our century-long enterprising spirit, follow the 14th Five-Year
+Plan to continuously grow our comprehensive strength, with the aspiration to facilitate the new
+development pattern and contribute to the stability of the macro economy.
+We ensured sound operation in spite of mounting risks and challenges. The complex and
+fast-changing external environment provided us an incentive to take a more forward-looking
+and rigorous stance on industry research, and timely update industry credit policies, which has
+enabled us to identify and avert potential risks effectively thus far. We've moved steadily forward
+with risky assets disposal as well. In our domestic operations, we've reduced the gross non-
+performing assets by RMB147.5 billion; and the percentages of non-performing loans, overdue
+loans, and special-mention loans were all declining. 2021 was also our “year of internal control
+and compliance". We enhanced efforts in internal control and precautions, and strengthened
+protection of consumer rights. Throughout the year, we organised public activities raising
+awareness of consumer protection that reached near 570 million people. In addition, we kept
+tracking the latest developments of COVID and regulatory requirements, and took measures to
+ensure the safety of our staff and business continuity of our operations overseas.
+20
+20
+Our standing as the most globalised bank in China was enhanced as we continued to
+serve the higher-level opening-up. As the world emerges from the pandemic and settles into
+a reshaped landscape for business in the post-COVID era, we change and adapt as well, by
+scaling up our cross-border service capabilities while featuring more of the “China elements".
+We adopted a market-by-market approach in managing and optimising our global network,
+and made substantive progress in advancing regionalised management, business consolidation,
+and integrated operation; moreover, we extended our overseas operations to 62 countries and
+regions outside Chinese mainland. We also leveraged our global reach and expertise in cross-
+border finance to support a series of international events, including the CIIE, CIFTIS, the Canto
+Fair, and the Hainan Expo, and financed or facilitated large volumes of cross-border trade and
+commerce through our services. All these efforts have contributed to the highest growth in years
+with respect to international settlement within the country and cross-border RMB settlement.
+average.
+Supporting the real economy remained our steadfast commitment and sharpened our
+competitive edge in 2021. We maintained a well-managed and robust credit portfolio, and
+grew our domestic lending both in yuan and in foreign currencies by RMB1,451.468 billion,
+the fastest in a decade. We expanded the Group's asset management business, with an AUM
+of RMB3.2 trillion, and channeled financial resources into national strategic initiatives for
+development, with enhanced efficiency for resource allocation. We especially ramped up support
+to some critical or underserved sectors in the economy: inclusive loans granted to micro and
+small enterprises (MSES) grew by RMB305.9 billion, with the number of first-time borrowers
+up by over 40,000; the use of our special credit scheme for enterprises working on advanced
+technologies and innovations increased to cover over 15,000 clients; and newly extended loans
+processed online stood above RMB100 billion for the first time. Unlocking funding for supply
+chain was another key task to further energise participants of the economy. In 2021, we grew our
+financing for core enterprises on the supply chain, as well as for their up and downstream MSES,
+by 20%. On the sustainability side, we joined UN's Principles for Responsible Banking (PRB)
+and became the first Chinese bank to have pledged to cease financing new coal-mining and coal-
+fired power projects outside Chinese Mainland, except for those projects already contracted;
+meanwhile, remained the leading investor and underwriter of green bonds in the domestic
+market. Additionally, benefiting from our alignment with China's regional development policies,
+we reported faster growth in RMB deposits and loans in several key regions than the national
+2021 again saw BOC rising to the challenges and making steady progress on all fronts: we
+reported record asset, liability, and operating income; broke new ground in key business areas;
+and gathered momentum in transition and reform. The good financial performance we achieved
+in 2021, which inaugurates our 14th Five-Year Plan development period, has set the stage for
+sustained growth and development in the years ahead.
+Message from the President
+income/
+Average
+Volume
+rate
+balance
+expense
+interest rate
+factor
+factor
+Total
+Loans
+24,271,688
+9,224
+3.25% 22,461,743
+1.63% 20,728,709
+344,152
+1.66%
+29,265
+(9,071)
+20,194
+Net interest income
+425,142
+415,918
+35,911 (26,687)
+Net interest margin
+1.75%
+6,117
+1.85%
+Notes:
+1
+2
+3
+Investments include debt securities at fair value through other comprehensive income, debt securities at amortised
+cost, investment trusts and asset management plans, etc.
+Balances with central banks and due from and placements with banks and other financial institutions include
+mandatory reserves, surplus reserves, other placements with central banks and due from and placements with
+banks and other financial institutions.
+Due to and placements from banks and other financial institutions include due to and placements from banks and
+other financial institutions, due to central banks and other funds.
+1
+29
+Message from the Chairwoman of the Board of Supervisors
+Average balances are average daily balances derived from the Group's management accounts (unaudited).
+The impact on interest income/expense of variances in the volume factor is calculated based on the changes in
+average balances of interest-earning assets and interest-bearing liabilities during the reporting period. The impact
+on interest income/expense of variances in the interest rate factor is calculated based on the changes in the average
+interest rates of interest-earning assets and interest-bearing liabilities during the reporting period. The impact
+relating to the combined changes in both the volume factor and the interest rate factor has been classified as a
+change in the interest rate factor.
+2
+(10)Bps
+309
+5,808
+3.16%
+760,070
+3.38%
+65,176
+(35,758) 29,418
+Interest-bearing liabilities
+Due to customers
+17,356,352
+263,599
+1.52% 16,351,229
+258,439
+1.58%
+15,881
+(10,721)
+5,160
+Due to and placements from banks and
+other financial institutions
+Bonds issued
+Total
+3,739,854 58,911
+1,313,387 41,836
+22,409,593 364,346
+1.58% 3,247,899
+49,994
+1.54%
+7,576
+1,341
+8,917
+3.19% 1,129,581
+35,719
+789,488
+In 2021, with the aim of building a first-class global banking group, and in compliance with
+relevant laws and regulations, regulatory requirements and the Articles of Association of the
+Bank, the Board of Supervisors aligned itself with national decisions and plans on economic
+and financial work, Bank-wide work priorities and core supervisory responsibilities. It duly
+supervised the Bank's strategies, duty performance, financial management, risk management
+and internal control, and enhanced its capabilities as well as the quality and effectiveness of
+supervision, thus continuously contributing to the high-quality development of the Bank.
+(104,220) (119,016)
+23
+157,866
+144,989
+153,042
+149,820
+2021
+2021
+2021
+2021
+31 March
+30 June
+31 December 30 September
+For the three-month period ended
+Unit: RMB million
+Profit attributable to equity holders of the Bank
+Net cash inflow/(outflow) from operating activities
+Operating income
+Items
+A detailed review of the Group's principal items in each quarter of 2021 is summarised in the
+following table:
+12.28%
+23,689
+192,870
+216,559
+of the Bank
+Profit attributable to equity holders
+10.85%
+12.27%
+(7,999) 19.38%
+22,243
+(49,281) (41,282)
+205,096
+227,339
+Profit for the year
+Income tax expense
+53,036
+30,242
+50,710
+In 2021, the Board of Supervisors adhered to the strategies and priorities of the country and
+constantly improved its supervision quality and efficiency. It focused on major national
+decisions and plans and intensified supervisory and prompting efforts. The Board of
+Supervisors focused on strengthening the Bank's capacity to serve the real economy, ensure
+stability on six key fronts and security in six key areas, and provide financial support for the
+implementation of policies and measures, such as green and low-carbon economic development,
+high-level scientific and technological self-reliance, rural revitalisation, common prosperity,
+the Belt and Road Initiative, as well as major regional development strategies of the country.
+Moreover, it carried out special surveys regarding the Bank's implementation of national
+decisions and plans for serving the real economy, and worked to ensure that these policies
+are delivered across the Bank. It focused on the Group's 14th Five-Year Plan and actively
+provided insights and suggestions. The Board of Supervisors actively participated in and
+supervised the research on, formulation and implementation of the Group's 14th Five-Year Plan,
+with a focus on the development of key strategic areas such as inclusive finance, green finance
+and cross-border finance, and oversaw that the Bank made an effort to better meet people's
+diverse financial needs. In addition, it conducted special surveys on strategic management, to
+make sure that the Group's development strategies are aligned with the national 14th Five-Year
+Plan and are properly implemented across the Bank. It focused on key areas and links to firmly
+safeguard the bottom line of risks. The Board of Supervisors actively studied and analysed the
+evolving trend in risk, and oversaw that under the new situation, the Bank strengthened credit
+risk prevention and control, internal control and compliance management of overseas institutions,
+risk management of non-banking subsidiaries in a penetrating approach, and improve mechanisms
+for major risk screening and emergency response. Furthermore, it conducted special surveys
+on the effectiveness of comprehensive risk management and internal control, so as to promote
+risk management with a view to better serve the Bank's development and ensure its sound
+operation. It focused on core duties and earnestly performed routine supervision. The Board
+of Supervisors conscientiously conducted regular supervision and annual evaluation of the duty
+performance of the Board of Directors, the Senior Management and their members, strengthened
+supervision on financial management based on the review of regular reports, and deepened
+supervision of risk management and internal control through a problem-oriented approach. It
+focused on creating supervision synergy and enhanced coordination and integration. The
+Board of Supervisors oversaw the effective rectification of problems identified in disciplinary
+inspections tours, audits and all kinds of regulatory inspections, and puts in place a longstanding
+rectification mechanism for common problems. It continuously reinforced its communication and
+coordination with the Board of Directors and the Senior Management, deepened its coordination
+with the Bank's second and third lines of defence and comprehensive management departments,
+and visited regulators, shareholders and major peers to broaden its supervision horizons and
+improve supervision performance.
+Interest
+income/expense
+Interest
+Items
+Average
+balance
+income/ Average
+expense interest rate
+Average
+2020
+2021
+Interest
+Unit: RMB million, except percentages
+Analysis of changes in interest
+The average balances¹ and average interest rates of the major interest-earning assets and interest-
+bearing liabilities of the Group, as well as the impact on interest income/expense of variances in
+the volume factor and the interest rate factor², are summarised in the following table:
+In 2021, the Group's net interest margin was 1.75%, a decrease of 10 basis points compared
+with the prior year, mainly due to declining yields from RMB loans in the Chinese mainland. To
+mitigate the impact of falling asset yields, the Bank continued to optimise its asset and liability
+structure. On the one hand, it remained committed to improving both the scale and pricing of
+deposits quantity and price and continued to optimise deposit structure, striving to control deposit
+costs at a reasonable level. On the other hand, it increased the granting of medium and long-term
+loans. The proportion of the average balance of RMB medium and long-term loans to RMB loan
+business in the Chinese mainland increased by 1.31 percentage points compared with the prior
+year.
+Net Interest Margin
+28
+Interest expense on bonds issued was RMB41.836 billion, an increase of RMB6.117 billion or
+17.13% compared with the prior year, mainly attributable to an increase in the scale of bonds
+issued.
+Interest expense on due to and placements from banks and other financial institutions was
+RMB58.911 billion, an increase of RMB8.917 billion or 17.84% compared with the prior year,
+primarily attributable to increases in the scale and the interest rate of due to and placements from
+banks and other financial institutions.
+In 2021, interest expense on due to customers was RMB263.599 billion, an increase of
+RMB5.160 billion or 2.00% compared with the prior year, principally due to an increase in the
+scale of deposits.
+Interest Expense
+Interest income on balances with central banks and due from and placements with banks and
+other financial institutions was RMB54.629 billion, a decrease of RMB4.534 billion or 7.66%
+compared with the prior year, mainly due to a decrease in yield of balances with central banks
+and due from and placements with banks and other financial institutions.
+Interest income on investments amounted to RMB153.859 billion, an increase of RMB3.306
+billion or 2.20% compared with the prior year, mainly due to an increase in investment scale.
+In 2021, interest income on loans was RMB581.000 billion, an increase of RMB30.646 billion or
+5.57% compared with the prior year, which was primarily attributable to an increase in loan scale.
+Interest Income
+In 2021, the Group achieved net interest income of RMB425.142 billion, an increase of
+RMB9.224 billion or 2.22% compared with the prior year. Specifically, interest income grew by
+RMB29.418 billion or 3.87% to RMB789.488 billion, and interest expense stood at RMB364.346
+billion, an increase of RMB20.194 billion or 5.87% compared with the prior year.
+Net Interest Income and Net Interest Margin
+27
+580,504
+108,072
+(240,907)
+395,589
+58,824
+11.75%
+53,989
+275,142 246,220
+276,620 246,378
+2021
+Items
+Unit: RMB million, except percentages
+The principal components and changes of the Group's consolidated income statement are set out
+below:
+Closely adhering to the requirements of the Group's 14th Five-year Plan, the Bank coordinated
+its work in responding to the pandemic and advancing its operations and management, gave full
+play to the synergies of the “One Mainstay, Two Engines” strategy, and focused on all aspects of
+the "Eight Priority Areas for Enhancing Financial Services Capabilities”, thus pursuing progress
+while ensuring stability in business performance. In 2021, the Group achieved a profit for the
+year of RMB227.339 billion, an increase of RMB22.243 billion or 10.85% compared with the
+prior year. It realised a profit attributable to equity holders of the Bank of RMB216.559 billion,
+an increase of RMB23.689 billion or 12.28% compared with the prior year. Return on average
+total assets (ROA) was 0.89% and return on average equity (ROE) was 11.28%.
+Income Statement Analysis
+28,922
+In 2021, the Board of Supervisors further strengthened itself. It optimised its procedural rules and
+improved the quality and efficiency of its meetings. It also improved its policies and expanded its
+team. Meanwhile, it strengthened the training of supervisors to ensure that supervision keeps pace
+with changes in the overall situation as well as market requirements. All members of the Board of
+Supervisors performed their supervisory duties faithfully and diligently, and provided suggestions
+and supervisory opinions on the operation and management of the Bank. These contributions
+were forward-looking, targeted and pragmatic, and were highly valued, earnestly responded to,
+and widely adopted by the Board of Directors and the Senior Management. In this way, the results
+of supervision by the Board of Supervisors were effectively communicated, implemented and
+applied across the Bank.
+In 2021, the Board of Supervisors completed changes to some of its members, in compliance
+with laws and regulations and the Articles of Association of the Bank. On behalf of the Board
+of Supervisors, I would like to express our sincere gratitude to Mr. WANG Zhiheng and Mr. LI
+Changlin, who no longer serve as supervisors of the Bank, for their efforts and contributions to
+the Bank during their tenure, and extend our warm welcome to Ms. WEI Hanguang, Mr. ZHOU
+Hehua and Mr. HUI Ping as new supervisors of the Bank!
+In 2022, under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics
+for a New Era, the Board of Supervisors will earnestly implement the national decisions and
+plans, and regulatory requirements, and adhere to the general principle of seeking progress while
+maintaining stability. Meanwhile, with its focus on the central tasks of the Bank, it will conduct
+effective supervision of strategies, duty performance, financial management, risk management
+and internal control, so as to better play its constructive supervisory role in the Bank's corporate
+governance system, and make greater contributions to the Bank's drive towards building a first-
+class global banking group.
+Economic and Financial Environment
+ZHANG Keqiu
+14
+24
+Management Discussion and Analysis
+26
+China's banking institutions made every effort to promote the new dual-circulation development
+pattern, enhanced their support to the real economy, and adopted various measures to help
+micro and small-sized enterprises and stimulate the vitality of private businesses, in order to
+advance high-quality economic development. They took targeted measures to support national
+development strategies and the construction of key projects, and strived to meet the financial
+demands of various fields such as infrastructure, advanced manufacturing, and scientific and
+technological innovation. The banking sector applied the new development philosophy, facilitated
+green and low-carbon transformation, ensured stable energy prices and supply, actively served
+rural revitalisation, promoted common prosperity, and bolstered technological empowerment
+to support high-level opening-up. The banking industry improved financial risk management,
+replenished capital through multiple channels and defended the bottom line that no systemic
+risk should occur. As at the end of 2021, the total assets of China's banking industry grew by
+7.8% from the prior year-end to RMB344.8 trillion, while total liabilities increased by 7.6% to
+RMB315.3 trillion. Commercial banking institutions recorded an aggregate profit after tax of
+RMB2.2 trillion. Outstanding non-performing loans (NPLs) stood at RMB2.8 trillion at the year-
+end, with an NPL ratio of 1.73%.
+The PBOC adhered to a sound monetary policy that was flexible, targeted, reasonable and
+appropriate, reinforced cross-cyclical adjustment, played roles of monetary policy tools in
+adjusting both the aggregate and the structure, and further intensified policy support for scientific
+and technological innovations, micro, small, and medium-sized enterprises, green development
+and manufacturing, thus safeguarding the overall stability of the macro economy and fostering a
+favourable monetary and financial environment for high-quality economic development. Overall,
+financial markets operated smoothly, liquidity was maintained at an adequate and reasonable
+level, and RMB exchange rates remained generally stable at an appropriate and balanced level.
+The outstanding broad money supply (M2) grew by 9.0% year-on-year. RMB loans increased by
+RMB19.95 trillion, RMB315.0 billion more than the increase of the prior year. The aggregate
+financing to the real economy (AFRE) was RMB314.13 trillion, an increase of 10.3% year-
+on-year. The cumulative value of bond issuance expanded to a total of RMB61.4 trillion, an
+increase of 7.8% year-on-year. The central parity rate of RMB against USD appreciated by 2.3%
+compared with the prior year-end. The Shanghai Stock Exchange Composite Index increased
+166.7 points compared with the prior year-end. The combined market capitalisation of the
+Shanghai and Shenzhen Stock Exchanges stood at RMB75.16 trillion, an increase of 16.78%
+year-on-year.
+25
+China properly coordinated and promoted pandemic containment and economic and social
+development, and continued to ensure stability on six key fronts (namely employment, financial
+sector, foreign trade, foreign investment, domestic investment, and expectations) and maintain
+security in six key areas (namely employment, the people's basic livelihood, operations of market
+entities, food and energy security, stable industrial and supply chains, and the normal functioning
+of primary-level governments). As a result, China's economy maintained a stable recovery, new
+progress was made in high-quality development, and the 14th Five-Year Plan got off to a great
+start. In 2021, China's gross domestic product (GDP) increased by 8.1%. Total retail sales of
+consumer goods (TRSCG) increased by 12.5%, total fixed asset investments (TFAI) (excluding
+those by rural households) grew by 4.9%, imports and exports rose by 21.4%, and the consumer
+price index (CPI) went up by 0.9%. The trade surplus was RMB4,368.7 billion.
+Global monetary policies gradually moved away from their emergency pandemic response stance
+and returned to normal, while shifts in the monetary policies of the world's major developed
+economies accelerated. The US Federal Reserve began to taper its bond-buying programme, the
+European Central Bank slowed down the implementation of its Pandemic Emergency Purchase
+Programme (PEPP), and the Bank of England initiated procedures to raise interest rates. Several
+emerging economies repeatedly raised interest rates to cope with inflation pressures and to
+mitigate risks triggered by capital outflows and currency depreciation. International financial
+markets remained generally stable, but the financial vulnerability of some emerging economies
+increased. US dollar liquidity remained ample and global stock markets fluctuated upwards, albeit
+with significant divergence between stock markets in developed and emerging economies. The
+commodity markets performed robustly as energy prices soared, industrial metal prices hit record
+highs, and prices of safe-haven assets such as gold fell. The US dollar index rebounded along a
+volatile trajectory, while the currencies of emerging economies generally came under pressure.
+In 2021, the global economy showed signs of recovery with the pace of growth gradually
+returning to normal. Industrial production and trade in goods steadily improved, overtaking pre-
+pandemic levels, while the digital economy and green transformation provided new drivers for
+the global economy. However, the global economy remained complex and in a serious situation
+due to repeated COVID-19 outbreaks, supply-chain disruptions, increasing inflation pressure and
+other factors.
+Chairwoman of the Board of Supervisors
+29 March 2022
+Net interest income
+2020 Change Change (%)
+415,918
+Profit before income tax
+Operating profit
+11.83%
+(226,355) (202,411) (23,944)
+14,796 (12.43%)
+Impairment losses on assets
+Operating expenses
+6.71%
+38,070
+567,647
+605,717
+Operating income
+7.82%
+5,904
+FINANCIAL REVIEW
+75,522
+81,426
+Including: net fee and commission income
+19.01%
+28,846
+151,729
+180,575
+Non-interest income
+2.22%
+9,224
+425,142
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+18 Financial investments (Continued)
+43,679
+As at 31 December
+2021
+2020
+Debt securities
+Issuers in Chinese mainland
+Government (3)(4)
+- Public sectors and quasi-governments
+2,417,293
+2,327,382
+64,724
+FOR THE YEAR ENDED 31 DECEMBER 2021
+- Policy banks
+Financial assets at amortised cost
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+298
+2,107,790
+- Public sectors and quasi-governments
+28,529
+27,340
+- Financial institutions
+79,214
+98,545
+- Corporate
+114,925
+BANK OF CHINA LIMITED
+107,583
+Total financial assets at fair value through
+other comprehensive income (2)
+155,338
+2,363,078
+2,086,362
+26,752
+21,428
+2,389,830
+Equity instruments and other
+93,376
+Investment trusts, asset management plans and other
+76,280
+2,935,959
+12,010
+14,447
+434,344
+299
+5,591,117
+6,164,671
+Total financial investments (6)(7)(8)
+2,978,778
+3,213,199
+Total financial assets at amortised cost
+(8,923)
+(9,727)
+Less: allowance for impairment losses
+37,295
+38,865
+Accrued interest
+3,172,051
+19,166
+19,058
+- Corporate
+59,250
+- Corporate
+48,959
+39,529
+China Orient (5)
+152,433
+152,433
+Issuers in Hong Kong (China), Macao (China),
+- Financial institutions
+Taiwan (China) and other countries and regions
+101,974
+103,432
+- Public sectors and quasi-governments
+70,107
+37,950
+- Financial institutions
+65,885
+59,762
+-Governments
+532,338
+88,025
+Taiwan (China) and other countries and regions
+Stage 1
+Total
+Lifetime ECLS
+12-month
+ECLS
+Year ended 31 December 2021
+loans with stage transfers
+Impairment (reversal)/losses of
+Transfers to Stage 3
+Transfers to Stage 2
+Transfers to Stage 1
+Stage 2
+As at 1 January
+17.3 Reconciliation of allowance for impairment losses on loans and advances to customers
+(Continued)
+17 Loans and advances to customers (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+292
+368,173
+162,895
+(2) Allowance for loans at fair value through other comprehensive income
+Stage 3
+441
+5
+531,726
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+293
+451
+77
+374
+As at 31 December
+(4)
+(4)
+Exchange differences and other
+353
+(344)
+(5)
+(339)
+(ii)
+Reversal for the year
+77
+276
+(i)
+Charge for the year
+446
+70,712
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+134,566
+(2,767) (5,014)
+loans with stage transfers
+Impairment (reversal)/losses of
+30,953
+(30,546)
+(407)
+Transfers to Stage 3
+(12,639)
+13,913
+Transfers to Stage 2
+(537)
+(3,507)
+(3,232)
+325,360
+136,544
+79,051
+109,765
+As at 1 January
+Transfers to Stage
+Stage 3
+Stage 2
+Stage 1
+Total
+Lifetime ECLS
+3,769
+9,357
+35,203
+41,053
+(764)
+(1,483)
+Exchange differences and other
+8,405
+8,405
+written off
+Recovery of loans and advances
+(64,321)
+(64,255)
+(66)
+Write-off and transfer out
+(74,547)
+(10,126)
+(21,257)
+(43,164)
+(ii)
+Reversal for the year
+137,237
+42,114
+24,190
+70,933
+(i)
+Charge for the year
+As at 31 December
+12-month
+ECLS
+17 Loans and advances to customers (Continued)
+(2) Allowance for loans at fair value through other comprehensive income (Continued)
+204,624
+― Financial institutions
+31,755
+26,127
+302
+30
+20,176
+18,837
+2020
+As at 31 December
+2021
+188,092
+- Public sectors and quasi-governments
+Policy banks
+Issuers in Chinese mainland
+Debt securities
+through profit or loss
+other financial assets at fair value
+Financial assets held for trading and
+profit or loss
+Financial assets at fair value through
+18 Financial investments
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+Government
+Corporate
+52,415
+42,122
+102,268
+321,120
+338,725
+296
+through profit or loss
+69,183
+other financial assets at fair value
+Total financial assets held for trading and
+Fund investments and other
+Equity instruments
+9,603
+9,808
+10,106
+12,982
+- Financial institutions
+Corporate
+45
+367
+- Public sectors and quasi-governments
+18,919
+13,535
+Governments
+Taiwan (China) and other countries and regions
+Issuers in Hong Kong (China), Macao (China),
+(Amount in millions of Renminbi, unless otherwise stated)
+17.3 Reconciliation of allowance for impairment losses on loans and advances to customers
+(Continued)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+BANK OF CHINA LIMITED
+568
+(681)
+(16)
+(665)
+15
+563
+Reversal for the year (ii)
+(i)
+Charge for the year
+loans with stage transfers
+Impairment (reversal)/losses of
+Exchange differences and other
+Transfers to Stage 3
+16
+547
+Stage 3
+Stage 2
+Total
+Lifetime ECLS
+12-month
+ECLS
+Stage 1
+Year ended 31 December 2020
+Transfers to Stage 2
+As at 1 January
+Transfers to Stage
+563
+(4)
+- (4)
+As at 31 December
+295
+Through personal loan securitisation, the domestic branches transferred out loans of
+RMB53,258 million (2020: RMB18,323 million), resulting in a decrease of RMB 195
+million (2020: RMB66 million) and RMB6,976 million (2020: RMB1,702 million) in
+the impairment allowance for Stage 1 and Stage 3 loans respectively.
+During the year, the disposal of non-performing loans by domestic branches via
+write-off, transfer of creditor's rights and loans to equity conversion amounted
+to RMB75,152 million (2020: RMB64,269 million), resulting in a corresponding
+reduction of RMB72,016 million (2020: RMB58,172 million) in impairment allowance
+for Stage 3 loans.
+The domestic branches performed regular reviews of the five-category loan
+classification grading and internal credit ratings on their loans and advances to
+customers. Loans with a gross carrying amount of RMB71,309 million (2020:
+RMB69,946 million) were transferred from Stage 1 to Stage 2 and Stage 3, and the
+impairment allowance increased correspondingly by RMB23,296 million (2020:
+RMB22,008 million). The gross carrying amount of loans transferred from Stage 2 to
+Stage 3 was RMB38,376 million (2020: RMB67,364 million), with a corresponding
+increase in impairment allowance of RMB13,814 million (2020: RMB20,900 million).
+The gross carrying amount of the loans transferred from Stage 2 to Stage 1 was
+RMB22,435 million (2020: RMB16,132 million), and the impairment allowance
+decreased correspondingly by RMB3,729 million (2020: RMB2,677 million). The
+gross carrying amount of loans transferred from Stage 3 to Stage 2 and Stage 1
+was RMB2,463 million (2020: RMB16,720 million), and the impairment allowance
+decreased correspondingly by RMB1,438 million (2020: RMB6,656 million).
+•
+•
+In 2021, the changes in gross carrying amounts of loans and advances to customers that have
+a significant impact on the Group's impairment allowance were mainly derived from the
+credit business in the Chinese mainland, including:
+The Group enhanced its ECL models in 2021, which has no significant impact to the
+financial statements.
+17.3 Reconciliation of allowance for impairment losses on loans and advances to customers
+(Continued)
+17 Loans and advances to customers (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+294
+Reversal for the year comprises impairment losses attributable to loan repaid during the year, brought
+forward loans without stage transfers, as well as changes to model and risk parameters.
+(ii)
+Charge for the year comprises impairment losses attributable to new loans granted during the year, brought
+forward loans without stage transfers, as well as changes to model and risk parameters.
+(i)
+446
+5
+441
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+- Governments
+Year ended 31 December 2020
+17.3 Reconciliation of allowance for impairment losses on loans and advances to customers
+(Continued)
+through profit or loss (designated)
+Debt securities (¹)
+Issuers in Chinese mainland
+Government
+As at 31 December
+2021
+2020
+- Policy banks
+Financial institutions
+Corporate
+Financial assets at fair value
+3,164
+516
+509
+4,811
+6,640
+396
+1,846
+Issuers in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions
+-Governments
+594
+3,073
+profit or loss (continued)
+Financial assets at fair value through
+18 Financial investments (Continued)
+Personal loans
+8,234,541
+9,224,184
+Corporate loans and advances
+Measured at amortised cost
+2020
+2021
+As at 31 December
+17.1 Analysis of loans and advances to customers by measurement category
+17 Loans and advances to customers
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+478,328
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+1,295
+6,093,750
+- Public sectors and quasi-governments
+721
+Debt securities
+As at 31 December
+2021
+2020
+Issuers in Chinese mainland
+-
+Government
+- Public sectors and quasi-governments
+- Policy banks
+Financial institutions
+through other comprehensive income
+752,899
+101,562
+88,092
+358,807
+328,713
+223,510
+174,517
+- Corporate
+171,294
+135,590
+Issuers in Hong Kong (China), Macao (China),
+691,638
+Financial assets at fair value
+18 Financial investments (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+- Financial institutions
+2,322
+5,525
+- Corporate
+4,770
+6,514
+17,737
+26,123
+Other
+12,179
+98
+Total financial assets at fair value
+through profit or loss (designated)
+29,916
+26,221
+Total financial assets at fair value
+through profit or loss
+561,642
+504,549
+297
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+1,164
+(1) Allowance for loans at amortised cost (Continued)
+5,583,295
+1,460
+84,479
+(i)
+Charge for the year
+37,567
+32,586
+10,226
+(5,245)
+loans with stage transfers
+Impairment (reversal)/losses of
+14,931
+90,733
+(687) (14,244)
+(797)
+1,786
+(989)
+Transfers to Stage 2
+(981)
+(5,205)
+6,186
+368,173
+162,895
+70,712
+Transfers to Stage 3
+58,502
+158,113
+Reversal for the year (ii)
+17 Loans and advances to customers (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+291
+169,900 390,090
+53,832
+166,358
+As at 31 December
+11,921 11,921
+(1,851) (2,697)
+(488)
+(358)
+Exchange differences and other
+written off
+Recovery of loans and advances
+(85,596)
+(21,905) (97,391)
+(85,401)
+(195)
+Write-off and transfer out
+(24,087)
+(51,399)
+134,566
+Discounted bills
+As at 1 January
+Transfers to Stage
+Stage 2
+15,712,574
+Total loans and advances
+33,092
+37,580
+14,183,385
+15,674,994
+3,661
+3,805
+14,179,724
+15,671,189
+14,216,477
+Accrued interest
+Corporate loans and advances
+-
+Measured at fair value through profit or loss (2)
+Subtotal
+979
+358,997
+2,254
+349,541
+- Corporate loans and advances
+Discounted bills
+other comprehensive income (1)
+Measured at fair value through
+1,912
+Total
+Less: allowance for loans at amortised cost
+(390,090)
+(368,173)
+Stage 1
+Total
+Lifetime ECLS
+ECLS
+12-month
+Year ended 31 December 2021
+(1) Allowance for loans at amortised cost
+17.3 Reconciliation of allowance for impairment losses on loans and advances to customers
+17.2 Analysis of loans and advances to customers (accrued interest excluded) by geographical
+area, customer type, industry, collateral type and analysis of impaired and overdue loans
+and advances to customers are presented in Note VI.2.5.
+17 Loans and advances to customers (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+290
+During the years ended 31 December 2021 and 2020, there were no significant movements in the fair value
+and accumulated fair value changes of corporate loans and advances measured at fair value through profit or
+loss that are attributable to changes in credit risk of these loans.
+As at 31 December 2021, the allowance for impairment losses of loans and advances to customers at fair
+value through other comprehensive income of the Group amounted to RMB451 million (31 December
+2020: RMB446 million) and was credited to other comprehensive income.
+(2)
+(1)
+13,848,304
+15,322,484
+Loans and advances to customers, net
+Stage 3
+15,132
+(1,274)
+11,204
+1,413
+5,550
+6,247
+11,187
+24,397
+Transfer from/(to) investment properties
+(Note V.21)
+Additions
+960
+Construction in progress transfer in/(out)
+2,806
+607
+(8,046)
+4,633
+Deductions
+(1,736)
+960
+(5,748)
+368,107
+31,281
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+20 Property and equipment
+Buildings
+Year ended 31 December 2021
+Equipment
+141,025
+and motor Construction
+progress
+Aircraft
+Total
+Cost
+As at 1 January
+122,464
+73,337
+vehicles in
+BANK OF CHINA LIMITED
+(1,788)
+(16,009)
+(6,274)
+(4,911)
+(15,283)
+Deductions
+1,145
+5,563
+1,747
+(4,098)
+8,455
+10
+10
+Exchange differences
+239
+186
+444
+869
+Transfer to investment properties (Note V.21)
+(6,737)
+Additions
+(17,302)
+Exchange differences
+(918)
+(249)
+(502)
+(3,207)
+(4,876)
+As at 31 December
+(117,955)
+124,989
+27,192
+146,901
+372,579
+Accumulated depreciation
+As at 1 January
+(42,814)
+(57,839)
+73,497
+305
+As at 31 December 2021, there were no restrictions on associates and joint ventures to
+transfer funds to the Group.
+33,508
+Exchange differences and other
+As at 31 December
+2021
+2020
+33,508
+23,210
+2,240
+Dividends received
+12,655
+(1,157)
+1,478
+158
+(625)
+(402)
+(204)
+(956)
+(628)
+35,769
+Share of results, net of tax
+As at 1 January
+Additions
+Exchange differences and other
+(19)
+1
+(19)
+As at 31 December
+4,979
+500
+Disposals and transfer out
+5,479
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+19 Investment in associates and joint ventures
+304
+33,508
+The carrying amounts of major investments in associates and joint ventures of the Group are
+as follows. Further details are disclosed in Note V.42.4.
+As at 31 December
+2021
+N/A
+Wkland Investments II Limited
+835
+855
+National Green Development Fund
+800
+N/A
+1,308
+Wuhu Yinsheng Special Steel Investment Management
+780
+755
+Other
+6,124
+6,738
+Total
+35,769
+Limited Partnership
+Shanghai Chenggang Real Estate Co., Ltd.
+1,386
+1,414
+2020
+China Insurance Investment Fund Co., Ltd.
+11,849
+11,563
+BOC International (China) Co., Ltd.
+5,254
+5,022
+Ying Kou Port Group CORP.
+4,311
+4,261
+CGN Phase I Private Equity Fund Company Limited
+1,679
+1,622
+Sichuan Lutianhua Co., Ltd.
+1,415
+1,306
+Graceful Field Worldwide Limited
+As at 31 December
+(45,518)
+(58,364)
+(20,022)
+(6,623)
+(4,635)
+(15,225)
+Deductions
+1,143
+9,178
+883
+(3,967)
+Transfer to investment properties (Note V.21)
+18
+Exchange differences
+393
+364
+1,212
+1,969
+As at 31 December
+18
+(42,814)
+Additions
+(14,762)
+Exchange differences
+(1,453)
+(453)
+(1,437)
+(8,619)
+(11,962)
+As at 31 December
+(115,921)
+122,464
+31,281
+141,025
+368,107
+Accumulated depreciation
+As at 1 January
+(40,401)
+(60,758)
+73,337
+(57,839)
+(17,302)
+(117,955)
+(590)
+(1,563)
+Net book value
+As at 1 January
+77,909
+16,898
+32,678
+(227)
+117,055
+As at 31 December
+78,904
+15,498
+31,054
+123,133
+248,589
+307
+244,540
+(746)
+As at 31 December
+39
+Allowance for impairment losses
+As at 1 January
+(767)
+(227)
+(4)
+(998)
+Additions
+(1)
+(623)
+(624)
+Deductions
+16
+4
+20
+Exchange differences
+6
+33
+(17,775)
+493
+(2,948)
+(10,726)
+(740)
+(227)
+(1,617)
+(2,584)
+Net book value
+As at 1 January
+78,904
+As at 31 December
+15,498
+123,133
+248,589
+As at 31 December
+78,731
+15,133
+26,965
+125,262
+31,054
+246,091
+24
+1
+(123,904)
+Allowance for impairment losses
+As at 1 January
+(746)
+(227)
+(590)
+(1,563)
+23
+Additions
+(1,060)
+(1,063)
+Deductions
+8
+10
+18
+Exchange differences
+(3)
+306
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+5,998
+11,658
+17,778
+36,142
+Transfer from/(to) investment properties
+(Note V.21)
+485
+708
+(242)
+Construction in progress transfer in/(out)
+5,375
+862
+(9,230)
+2,993
+Deductions
+(1,728)
+243
+Additions
+361,459
+131,821
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+20 Property and equipment (Continued)
+Year ended 31 December 2020
+Equipment
+and motor Construction
+Buildings
+vehicles
+in
+progress
+Aircraft
+Total
+Cost
+As at 1 January
+119,077
+77,656
+32,905
+(2,373)
+494
+Year ended 31 December
+stage transfer
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Financial investments (Continued)
+18
+BANK OF CHINA LIMITED
+(6)
+Carrying value (accrued interest excluded)
+Coupon rate range
+(7)
+As at 31 December
+2021
+2020
+942,440
+979,089
+As at 31 December 2021, the Group held bonds issued by the MOF and bills issued by the PBOC included
+in financial investments. The carrying value (accrued interest excluded) and the related coupon rate range
+on such bonds and bills are as follows:
+0.00%-5.31%
+301
+The Bank underwrites certain Treasury bonds issued by the MOF and undertakes the role of a distributor of
+these Treasury bonds through its branch network earning commission income on bonds sold. The investors
+of these bonds have a right to redeem the bonds at any time prior to maturity and the Bank is committed
+to redeem these Treasury bonds. The balance of these bonds held by the Bank as at 31 December 2021
+amounted to RMB2,083 million (31 December 2020: RMB2,337 million).
+38,898
+39,594
+34,217
+35,960
+- Listed outside Hong Kong,
+China (9)
+2,886,030
+2,937,103 2,618,215
+The Bank transferred certain non-performing assets to China Orient Asset Management Corporation
+("China Orient”) in 1999 and 2000 and China Orient issued a bond ("Orient Bond") with a par value of
+RMB160,000 million to the Bank as consideration. Based on the latest agreement, the Orient Bond will
+mature on 30 June 2025. The MOF shall continue to provide funding support for the principal and interest
+of the Orient Bond. The Bank received a notice from the MOF in January 2020, confirming that from 1
+January 2020, the interest rate on the unpaid amounts will be verified year by year based on the rate of
+return of the five-year treasury bond of the previous year. As at 31 December 2021, the Bank had received
+early repayments of principal amounting to RMB7,567 million cumulatively.
+2,637,926
+(2)
+(3)
+(4)
+(5)
+In order to eliminate or significantly reduce accounting mismatches, certain debt securities are designated as
+financial assets at fair value through profit or loss.
+The Group's accumulated impairment allowance for the debt securities at fair value through other
+comprehensive income as at 31 December 2021 amounted to RMB6,230 million (31 December 2020:
+RMB5,479 million).
+On 18 August 1998, a Special Purpose Treasury Bond was issued by the Ministry of Finance ("MOF”) with
+a par value of RMB42,500 million maturing on 18 August 2028. This bond was originally issued with an
+annual coupon rate of 7.20% and its coupon rate was restructured to 2.25% per annum from 1 December
+2004.
+(1)
+0.00%-5.31%
+(8)
+(9)
+As at 1 January
+1,907
+1
+7,015
+8,923
+Impairment losses during the year
+159
+Stage 3
+3
+721
+Write-off and transfer out
+Exchange differences and other
+107
+As at 31 December
+2,173
+(24)
+559
+Stage 2
+Stage 1
+Total
+Included in the Group's financial investments were certificates of deposit held amounting to RMB 149,530
+million as at 31 December 2021 (31 December 2020: RMB130,698 million).
+As at 31 December 2021, RMB2,338 million of debt securities measured at fair value through other
+comprehensive income and at amortised cost of the Group was determined to be impaired and was included
+under Stage 3 (31 December 2020: RMB1,467 million), with the impairment allowance fully accrued
+(31 December 2020: fully accrued); RMB816 million of debt securities was included under Stage 2 (31
+December 2020: RMB404 million), with an impairment allowance of RMB5 million (31 December 2020:
+RMB1 million); and the remaining debt securities were included under Stage 1, with impairment allowance
+measured based on 12-month expected credit losses.
+Debt securities traded in the Chinese mainland interbank bond market are included in "Listed outside Hong
+Kong, China".
+302
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+18 Financial investments (Continued)
+Reconciliation of allowance for impairment losses on financial investments at amortised
+cost:
+Year ended 31 December 2021
+12-month
+(1)
+Lifetime ECL
+- Listed in Hong Kong, China
+83
+Debt securities at amortised cost
+Carrying
+value
+Financial assets at fair value through
+other comprehensive income
+Debt securities
+- Listed in Hong Kong, China
+154,931
+233,244
+- Listed outside Hong Kong, China (9)
+- Unlisted
+172,308
+1,633,446
+574,701
+642,384
+Equity instruments and other
+- Listed in Hong Kong, China
+5,980
+6,031
+- Listed outside Hong Kong, China (9)
+Unlisted
+1,210,734
+11,762
+195,966
+332,549
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+18 Financial investments (Continued)
+283,523
+As at 31 December
+2020
+Analysed as follows:
+Financial assets at fair value through profit or loss
+- Listed in Hong Kong, China
+33,127
+48,718
+- Listed outside Hong Kong, China (9)
+Unlisted
+2021
+3,141
+9,010
+12,256
+Total
+300
+6,164,671
+5,591,117
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+1,153,294
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+18 Financial investments (Continued)
+As at 31 December
+2021
+2020
+Carrying
+value
+Market
+value
+V
+1,067,948
+Unlisted
+4,115,613
+Financial assets at amortised cost
+Listed in Hong Kong, China
+38,898
+34,217
+- Listed outside Hong Kong, China (9)
+Unlisted
+2,886,030
+2,618,215
+288,271
+326,346
+Total
+6,164,671
+5,591,117
+Listed in Hong Kong, China
+232,936
+322,210
+Listed outside Hong Kong, China (9)
+4,863,787
+Market
+value
+7,550
+ECL
+Year ended 31 December 2020
+8,923
+9,727
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+7,015
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Financial investments (Continued)
+Reconciliation of allowance for impairment losses on financial investments at fair value
+through other comprehensive income:
+As at 1 January
+Transfers to Stage 2
+Transfers to Stage 3
+Impairment losses during the year
+Exchange differences and other
+As at 31 December
+18
+Year ended 31 December 2021
+1,907
+289
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+1
+6,402
+6,786
+Impairment losses during the year
+As at 31 December
+1,165
+1,872
+Write-off and transfer out
+(24)
+(24)
+Exchange differences and other
+359
+(70)
+707
+(Amount in millions of Renminbi, unless otherwise stated)
+12-month
+Lifetime ECL
+Stage 2
+Stage 3
+As at 1 January
+1,250
+4
+1,254
+Transfers to Stage 2
+Stage 1
+(1)
+Transfers to Stage 3
+(2)
+(4)
+Impairment losses during the year
+3,751
+3,751
+Impairment (gains)/losses due to
+1
+ECL
+Total
+ECL
+Total
+Stage 1
+Stage 2
+Stage 3
+4,979
+500
+5,479
+Lifetime ECL
+762
+5,729
+763
+(12)
+500
+6,230
+Year ended 31 December 2020
+12-month
+(12)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+303
+As at 31 December 2021, the net book amount of aircraft leased out by BOC Aviation
+Limited, a subsidiary of the Group, under operating leases was RMB125,262 million (31
+December 2020: RMB 123,133 million).
+Fair value changes (Note V.5)
+(15)
+(1,324)
+(261)
+(970)
+Transfer to property and equipment, net (Note V.20)
+Deductions
+1,626
+(427)
+720
+23,108
+22,065
+As at 1 January
+2020
+2021
+Year ended 31 December
+21 Investment properties
+Additions
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(1,505)
+(510)
+12-month
+ECL
+Lifetime ECL
+Total
+Stage 1
+Stage 2
+Stage 3
+Exchange differences
+As at 1 January
+309
+Investment properties are mainly held by Bank of China Hong Kong (Holdings)
+Limited ("BOCHK (Holdings)") and Bank of China Group Investment Limited ("BOCG
+Investment"), subsidiaries of the Group. The carrying values of investment properties
+held by BOCHK (Holdings) and BOCG Investment as at 31 December 2021 amounted to
+RMB10,708 million and RMB6,827 million, respectively (31 December 2020: RMB 12,009
+million and RMB7,835 million). The valuations of these investment properties as at 31
+December 2021 were principally performed by Knight Frank Petty Limited based on the
+open market price and other related information.
+The Group's investment properties are located in active real estate markets, and external
+appraisers make reasonable estimation of fair value using market prices of the same or
+similar properties and other related information from the real estate markets.
+22,065
+19,554
+As at 31 December
+20 Property and equipment (Continued)
+383
+(Amount in millions of Renminbi, unless otherwise stated)
+(888)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Subtotal
+8
+1
+on short-term lease (less than 10 years)
+7,884
+8,074
+on medium-term lease (10-50 years)
+3,749
+on long-term lease (over 50 years)
+2020
+2021
+As at 31 December
+Held in Hong Kong, China
+The carrying value of buildings is analysed based on the remaining terms of the leases as
+follows:
+According to the relevant PRC laws and regulations, after conversion into a joint stock
+limited liability company, the Bank is required to re-register its property and equipment
+under the name of Bank of China Limited. As at 31 December 2021, the process of re-
+registration has not been completed. However, this registration process does not affect the
+rights of Bank of China Limited to these assets.
+As at 31 December 2021, the net book amount of aircraft owned by BOC Aviation Limited,
+a subsidiary of the Group, that has been pledged for loan facilities was RMB9,989 million
+(31 December 2020: RMB 14,893 million) (Note V.31).
+FOR THE YEAR ENDED 31 DECEMBER 2021
+11,994
+11,641
+3,919
+on long-term lease (over 50 years)
+BANK OF CHINA LIMITED
+Held outside Hong Kong, China
+78,904
+78,731
+308
+Total
+66,737
+Subtotal
+6,910
+67,263
+6,852
+on short-term lease (less than 10 years)
+55,846
+56,051
+on medium-term lease (10-50 years)
+4,507
+3,834
+9,076
+Subtotal
+183
+on short-term lease (less than 10 years)
+on medium-term lease (10-50 years)
+4,793
+5,782
+10,253
+441
+Total
+123,590
+19,554
+22,065
+As at 31 December
+2021
+2020
+Accounts receivable and prepayments (¹)
+141,286
+Right-of-use assets (2)
+4,288
+20,321
+22 Other assets
+3,842
+V
+Held outside Hong Kong, China
+22,855
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+21
+Investment properties (Continued)
+The carrying value of investment properties is analysed based on the remaining terms of the
+leases as follows:
+As at 31 December
+on long-term lease (over 50 years)
+2021
+Held in Hong Kong, China
+on long-term lease (over 50 years)
+2,856
+1,976
+on medium-term lease (10-50 years)
+7,622
+9,836
+Subtotal
+10,478
+11,812
+2020
+Intangible assets (3)
+319
+15,614
+4,438
+40,358
+15,957
+71
+1,484
+14,402
+Other
+Subtotal
+6,230
+(12)
+763
+5,479
+comprehensive income
+― at fair value through other
+9,727
+83
+71
+446
+9
+(4)
+451
+Subtotal
+368,619
+(500)
+98,298
+(1,973)
+390,541
+Financial investments
+- at amortised cost
+8,923
+721
+(74,403)
+― at fair value through other
+comprehensive income
+(405)
+Total
+368,173
+(3,778)
+(57,152)
+103,743
+325,360
+―at amortised cost
+Loans and advances to customers
+2020
+and other
+out
+net
+2020
+As at
+differences 31 December
+(reversal), and transfer
+1 January
+Exchange
+Write-off
+423,379
+16,930
+(74,903)
+(2,307)
+450,389
+315
+43,891
+BANK OF CHINA LIMITED
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+23 Impairment allowance (Continued)
+As at
+Additions/
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+390,090
+(1,969)
+(74,403)
+Goodwill
+(6)
+The total book value of repossessed assets disposed of during the year ended 31 December 2021 amounted
+to RMB353 million (2020: RMB602 million). The Group plans to dispose of the repossessed assets held at
+31 December 2021 by auction, bidding or transfer.
+As at 31 December 2021, the net book amount of repossessed assets was RMB2,043 million (31 December
+2020: RMB2,120 million), mainly comprised properties. Related allowance for impairment was RMB882
+million (31 December 2020: RMB902 million).
+Repossessed assets
+(5)
+Other assets (Continued)
+22
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+6,526
+6,122
+313
+Total
+15,614
+The carrying value of land use rights is analysed based on the remaining terms of the leases as follows:
+Year ended 31 December
+2021
+2020
+Held outside Hong Kong, China
+As at 1 January
+on long-term lease (over 50 years)
+on medium-term lease (10-50 years)
+5,384
+60
+5,809
+on short-term lease (less than 10 years)
+680
+657
+58
+Addition through acquisition of subsidiaries
+Decrease resulting from disposal of subsidiaries
+Exchange differences
+As at 31 December
+As at
+1 January
+2021
+net
+Additions/ Write-off
+(reversal), and transfer
+out
+Exchange
+23 Impairment allowance
+As at
+and other
+2021
+Loans and advances to customers
+- at amortised cost
+368,173
+98,289
+differences 31 December
+―at fair value through other
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+Year ended 31 December
+2021
+2020
+2,525
+2,686
+(25)
+(Amount in millions of Renminbi, unless otherwise stated)
+(44)
+2,481
+2,525
+The goodwill mainly arose from the acquisition of BOC Aviation Limited in 2006 amounting to USD241
+million (equivalent to RMB 1,535 million).
+314
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(136)
+comprehensive income
+563
+(113)
+258,240
+279,480
+Banks in Chinese mainland
+2020
+2021
+As at 31 December
+Placements from:
+Placements from banks and other financial institutions
+Bank notes in circulation represent the liabilities in respect of Hong Kong Dollar notes
+and Macao Pataca notes in circulation, issued respectively by BOCHK and Bank of China
+Macau Branch.
+Bank of China (Hong Kong) Limited ("BOCHK") and Bank of China Macau Branch are
+note issuing banks for Hong Kong Dollar and Macao Pataca notes in Hong Kong (China)
+and Macao (China), respectively. Under local regulations, these two entities are required to
+place deposits with the Hong Kong (China) and Macao (China) governments, respectively,
+to secure the currency notes in circulation.
+27
+26 Government certificates of indebtedness for bank notes issued and bank notes in
+circulation
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+3,904
+2,682,739
+1,917,003
+As at 31 December
+2021
+2020
+107
+948,758
+Other financial institutions in Chinese mainland
+Banks in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions
+Other financial institutions in Hong Kong (China),
+Macao (China), Taiwan (China) and
+other countries and regions
+251,533
+948,865
+881,625
+6,692
+6,186
+955,557
+887,811
+630,092
+3,688
+27,933
+120,396
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+27 Placements from banks and other financial institutions (Continued)
+(1)
+According to the Group's risk management policy, the Group enters into derivatives to hedge market
+risks arising from its placements from banks and other financial institutions. The Group designates certain
+placements from banks and other financial institutions as financial liabilities at fair value through profit
+or loss, to eliminate or significantly reduce accounting mismatch. As at 31 December 2021, the carrying
+amount of the above-mentioned financial liabilities by the Group was RMB 162 million (31 December
+2020: RMB3,831 million). The differences between the fair value and the amount that the Group would be
+contractually required to pay to the holders as at 31 December 2021 and 2020 were not significant. In the
+years of 2021 and 2020, there was no significant change in the Group's credit risk nor changes in the fair
+value of these financial liabilities as a result.
+(2) Included in "Placements from banks and other financial institutions" are amounts received from
+counterparties under repurchase agreements and collateral agreements as follows:
+Repurchase debt securities (1)
+V
+As at 31 December
+2021
+97,372
+127,202
+(i) Debt securities used as collateral under repurchase agreements were principally government bonds
+and were included in the amount disclosed under Note V.40.2.
+28
+Financial liabilities held for trading
+As at 31 December 2021 and 2020, financial liabilities held for trading mainly included
+short position in debt securities.
+2020
+7,520
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+115,308
+3,408
+9,497
+Subtotal
+Accrued interest
+406,972
+FOR THE YEAR ENDED 31 DECEMBER 2021
+410,978
+971
+Total (1)(2)
+318
+407,767
+411,949
+BANK OF CHINA LIMITED
+795
+16,930
+1,913,099
+317
+(349)
+(662)
+9,270
+32,099
+14,402
+270
+(24)
+6,116
+8,040
+Other
+Subtotal
+5,479
+(19)
+4,244
+1,254
+comprehensive income
+― at fair value through other
+446
+Subtotal
+325,923
+103,630
+(57,152)
+(3,782)
+40,358
+368,619
+- at amortised cost
+6,786
+1,872
+(24)
+289
+8,923
+Financial investments
+Total
+366,062
+119,016
+515,162
+1,077,841
+145,363
+177,717
+121,640
+142,379
+Subtotal
+1,827,138
+Accrued interest
+25
+Due to central banks
+Foreign exchange deposits
+Other
+Subtotal
+Accrued interest
+Total
+Total
+2,675,219
+Other financial institutions in Chinese mainland
+Banks in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions
+Other financial institutions in Hong Kong (China),
+Macao (China), Taiwan (China) and
+other countries and regions
+Banks in Chinese mainland
+(57,838)
+(3,861)
+423,379
+316
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+581,078
+FOR THE YEAR ENDED 31 DECEMBER 2021
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+24
+Due to banks and other financial institutions
+As at 31 December
+2021
+2020
+Due to:
+(Amount in millions of Renminbi, unless otherwise stated)
+13,352
+104,220
+(1) Accounts receivable and prepayments
+(1,263)
+Exchange differences
+(313)
+(2)
+(315)
+(420)
+(423)
+(21)
+As at 31 December
+232
+36,679
+35,251
+176
+35,427
+Accumulated depreciation
+(12,477)
+36,447
+(1,242)
+(3,795)
+(61)
+Motor
+vehicles
+Total Buildings and other
+Total
+As at 1 January
+35,251
+176
+Additions
+5,243
+119
+35,427
+5,362
+29,500
+156
+29,656
+7,413
+44
+7,457
+Deductions
+(3,734)
+(95)
+(12,572)
+(6,781)
+(53)
+116
+As at 31 December
+(16,265)
+(93)
+(16,358) (12,477)
+(95)
+(12,572)
+Net book value
+As at 1 January
+22,774
+81
+22,855
+22,719
+103
+22,822
+As at 31 December
+20,182
+1
+Motor
+vehicles
+Buildings and other
+115
+2
+(6,834)
+Additions
+(7,087)
+(58)
+(7,145)
+(6,841)
+(63)
+(6,904)
+Deductions
+3,166
+58
+3,224
+1,030
+20
+1,050
+Exchange differences
+133
+135
+2020
+2021
+As at 31 December
+203,940
+217,196
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+22 Other assets (Continued)
+Accounts receivable and prepayments
+Impairment allowance
+Net value
+As at 31 December
+2021
+2020
+128,561
+146,144
+(4,971)
+310
+(4,858)
+Total
+28,840
+Land use rights (4)
+6,122
+6,526
+Long-term deferred expense
+3,329
+3,215
+Repossessed assets
+(5)
+2,043
+2,120
+Goodwill (6)
+Interest receivable
+2,481
+2,525
+284
+1,299
+Other
+21,756
+139
+123,590
+Accounts receivable and prepayments mainly include items in the process of clearing and settlement. The
+analysis of the ageing of accounts receivable and prepayments is as follows:
+(3,022)
+Total
+128,561
+(4,971)
+146,144
+(4,858)
+311
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Other assets (Continued)
+22
+(2)
+Right-of-use assets
+Cost
+6,459
+141,286
+(3,091)
+Over 3 years
+As at 31 December
+2021
+2020
+Balance
+Impairment
+allowance
+Balance
+Impairment
+allowance
+Within 1 year
+114,233
+(575)
+135,647
+(944)
+From 1 year to 3 years
+6,549
+(1,305)
+4,038
+(892)
+7,779
+20,321
+As at 1 January
+81
+2021
+2020
+34,709
+26,573
+6,120
+8,712
+(252)
+(226)
+(200)
+40,377
+34,709
+(19,095)
+(4,665)
+(13,221)
+(6,323)
+177
+208
+136
+241
+(23,447)
+(19,095)
+15,614
+22,774
+Year ended 31 December
+Land use rights
+(350)
+As at 31 December
+22,855
+(4)
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+22 Other assets (Continued)
+(3) Intangible assets
+Cost
+As at 1 January
+Additions
+312
+Net book value
+Exchange differences
+As at 31 December
+Accumulated amortisation
+As at 1 January
+Additions
+Deductions
+Exchange differences
+As at 31 December
+As at 1 January
+Deductions
+234,905
+58,916
+(40,818)
+(7,003) (45,934)
+16,879,171
+Net
+156,892
+51,172
+44,169
+(6,499)
+197,710
+Deferred
+tax assets/
+(liabilities)
+tax assets/ Temporary
+(liabilities) differences
+Temporary
+differences
+Deferred
+2020
+2021
+As at 31 December
+35.1 The table below includes the deferred income tax assets and liabilities of the Group after
+offsetting qualifying amounts and the related temporary differences.
+35 Deferred income taxes
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Deferred income tax assets
+Deferred income tax liabilities
+320
+Bonds issued at amortised cost
+Subordinated bonds issued
+2011 RMB Debt Securities (¹)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+2012 RMB Debt Securities
+Second Tranche (2)
+V
+Bonds issued
+30
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+321
+BANK OF CHINA LIMITED
+Due to customers included margin deposits received by the Group as at 31 December 2021 of RMB330,494
+million (31 December 2020: RMB304,314 million).
+Included in other deposits is special purpose funding, which represents long-term funding provided in
+multiple currencies by foreign governments and/or entities in the form of export credit, foreign government
+and other subsidised credit. The special purpose funding is normally used to finance projects with a special
+commercial purpose in the PRC as determined by the foreign governments or entities and the Group is
+obliged to repay the funding when it falls due.
+According to the Group's risk management policy, the Group enters into derivatives to hedge market risks
+arising from its structured deposits. The Group designates certain structured deposits as financial liabilities
+at fair value through profit or loss, to eliminate or significantly reduce accounting mismatch. As at 31
+December 2021, the carrying amount of these financial liabilities was RMB31,311 million (31 December
+2020: RMB25,742 million). The differences between the fair value and the amount that the Group would
+be contractually required to pay to the holders as at 31 December 2021 and 31 December 2020 were
+not significant. For the years ended 31 December 2021 and 2020, there was no significant change in the
+Group's credit risk nor changes in the fair value of these financial liabilities as a result.
+(3)
+(2)
+(1)
+Due to customers (Continued)
+29
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+As at 31 December 2021, the remaining maturity of special purpose funding ranges from 15 days to
+32 years. The interest-bearing special purpose funding bears interest at floating and fixed rates ranging
+from 0.15% to 7.92% (31 December 2020: 0.15% to 7.92%). These terms are consistent with the related
+development loans granted to customers.
+(Amount in millions of Renminbi, unless otherwise stated)
+3.0%
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+3.25%
+2.75%
+- Normal retiree
+_
+2020
+2021
+As at 31 December
+Discount rate
+Primary assumptions used:
+33 Retirement benefit obligations (Continued)
+- Early retiree
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+326
+2,199
+2,095
+As at 31 December
+(283)
+(254)
+(125)
+(Amount in millions of Renminbi, unless otherwise stated)
+2.50%
+2.75%
+Pension benefit inflation rate
+BANK OF CHINA LIMITED
+327
+No share appreciation rights were granted since the inception of the plan.
+In November 2005, the Bank's Board of Directors and equity holders approved and adopted
+a Share Appreciation Rights Plan under which eligible participants, including directors,
+supervisors, management and other personnel designated by the Board, will be granted share
+appreciation rights, up to 25% of which will be exercisable each year beginning on the third
+anniversary date from the date of grant. The share appreciation rights will be valid for seven
+years from the date of grant. Eligible participants will be entitled to receive an amount equal
+to the difference, if any, between the average closing market price of the Bank's H shares in
+the ten days prior to the date of grant and the average closing market price of the Bank's H
+shares in the 12 months prior to the date of exercise as adjusted for any change in the Bank's
+equity. The plan provides cash-settled share-based payment only and accordingly, no shares
+will be issued under the share appreciation rights plan.
+34 Share appreciation rights plan
+As at 31 December 2021 and 2020, there was no significant change in employee retirement
+benefit obligations that was attributable to changes in actuarial assumptions.
+Assumptions regarding future mortality experience are based on the China Life Insurance
+Mortality Table (published historical statistics in China).
+50/55
+50/55
+60
+60
+Male
+Female
+-
+Retiring age
+8.0%
+8.0%
+Medical benefit inflation rate
+3.0%
+3.0%
+- Early retiree
+3.0%
+Subtotal (17)
+Normal retiree
+FOR THE YEAR ENDED 31 DECEMBER 2021
+As at 31 December
+FOR THE YEAR ENDED 31 DECEMBER 2021
+188,971
+other comprehensive income
+1,224
+304
+Other temporary differences
+37,898
+8,849
+809
+41,355
+202
+9,599
+Subtotal
+Financial assets at fair value through
+403,841
+487,912
+120,737
+Deferred income tax liabilities
+Financial instruments at fair
+value through profit or loss and
+derivative financial instruments
+Financial assets at fair value through
+(108,696)
+(26,774) (174,976)
+(42,853)
+other comprehensive income
+100,004
+43,224
+174,011
+16,237
+84
+Deferred
+Temporary
+differences
+tax assets/ Temporary
+(liabilities)
+differences
+tax assets/
+(liabilities)
+Deferred income tax assets
+Asset impairment allowances
+274,503
+68,376
+253,785
+63,242
+Pension, retirement benefits
+and salary payables
+24,929
+6,238
+17,952
+4,470
+Financial instruments at fair
+value through profit or loss and
+derivative financial instruments
+Deferred
+65,287
+(37,265)
+Annual
+interest
+Depreciation and amortisation
+(9,205) (30,836)
+(4,530) (24,104)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+328
+52,417
+13 November 2014 13 November 2024
+2014 US Dollar Debt Securities (3)
+Tier 2 capital bonds issued
+50,000
+18,000
+18,000
+(Amount in millions of Renminbi, unless otherwise stated)
+18,000
+27 November 2012 29 November 2027
+32,000
+5.30%
+19 May 2026
+17 May 2011
+2020
+2021
+rate
+Maturity date
+Issue date
+4.99%
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+35 Deferred income taxes (Continued)
+(7,445)
+(4,193)
+Revaluation of property and
+investment properties
+(8,040)
+Other temporary differences
+(66,970)
+(1,536) (8,845) (1,722)
+(13,790) (60,180) (12,107)
+Subtotal
+(246,949)
+(55,835)
+(298,941) (68,320)
+Net
+156,892
+44,169
+188,971
+52,417
+19,084
+5.00%
+2020
+2021
+As at 31 December
+35.2 Deferred income tax assets/liabilities and related temporary differences, before offsetting
+qualifying amounts, are attributable to the following items:
+(25,978)
+Net actuarial losses/(gains) recognised
+Benefits paid
+rate
+66
+16 November 2031
+12 November 2021
+2021 RMB Debt Securities
+Second Tranche 01 (15)
+9,996
+4.38%
+19 March 2036
+17 March 2021
+2021 RMB Debt Securities
+First Tranche 02 (14)
+2020
+2017 RMB Debt Securities
+First Tranche (4)
+3.60%
+26 September 2017 28 September 2027
+29,973
+29,970
+2017 RMB Debt Securities
+Second Tranche (5)
+31 October 2017
+2 November 2027
+4.45%
+29,974
+29,972
+2018 RMB Debt Securities
+First Tranche (6)
+3 September 2018
+4.45%
+39,989
+2021 RMB Debt Securities
+Second Tranche 02 (16)
+554,801
+659,306
+Negotiable certificates of deposit
+323,037
+325,625
+Subtotal
+51,555
+49,403
+Other
+73,165
+90,604
+RMB Debt Securities
+198,317
+185,618
+US Dollar Debt Securities
+Other bonds issued (18)
+304,373
+378,924
+Subtotal (17)
+9,997
+3.80%
+16 November 2036
+12 November 2021
+5 September 2028
+Subtotal bonds issued at amortised cost
+4.86%
+39,983
+2020 RMB Debt Securities
+First Tranche 02 (12)
+17 September 2020 21 September 2035
+4.47%
+14,994
+14,994
+2021 RMB Debt Securities
+First Tranche 01 (13)
+17 March 2021
+19 March 2031
+4.15%
+14,995
+59,976
+322
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+30
+Bonds issued (Continued)
+As at 31 December
+Annual
+interest
+Issue date
+Maturity date
+BANK OF CHINA LIMITED
+59,976
+4.20%
+17 September 2020 21 September 2030
+2018 RMB Debt Securities
+Second Tranche (7)
+9 October 2018
+11 October 2028
+4.84%
+39,986
+39,985
+2019 RMB Debt Securities
+First Tranche 01 (8)
+20 September 2019 24 September 2029
+3.98%
+29,989
+29,988
+2019 RMB Debt Securities
+First Tranche 02 (9)
+20 September 2019 24 September 2034
+19,518
+4.34%
+9,996
+9,996
+2019 RMB Debt Securities
+Second Tranche (10)
+20 November 2019 22 November 2029
+4.01%
+29,991
+29,991
+2020 RMB Debt Securities
+First Tranche 01 (11)
+39,984
+74
+1,381,855
+Bonds issued at fair value (19)
+35,891
+Corporate income tax
+2020
+2021
+As at 31 December
+32 Current tax liabilities
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+47,337
+BANK OF CHINA LIMITED
+During the years ended 31 December 2021 and 2020, the Group did not default on any
+principal, interest or redemption amounts with respect to its other borrowings.
+As at 31 December 2021, these other borrowings had a maturity ranging from 7 days to 7
+years and bore floating and fixed interest rates ranging from 0.36% to 1.62% (31 December
+2020: 0.45% to 1.55%).
+These other borrowings relate to the financing of the aircraft leasing business of BOC
+Aviation Limited, a subsidiary of the Group. These other borrowings are secured by its
+aircraft (Note V.20).
+Other borrowings
+(20) During the years ended 31 December 2021 and 2020, the Group did not default on any principal, interest or
+redemption amounts with respect to its bonds issued.
+(19) According to the Group's risk management policy, the Group enters into derivatives to hedge market risks
+arising from its bonds issued. The Group designates certain bonds issued as financial liabilities at fair
+value through profit or loss, to eliminate or significantly reduce accounting mismatch. As at 31 December
+2021, the carrying amount of the above-mentioned bonds issued by the Group was RMB317 million
+(31 December 2020: RMB6,162 million). The differences between the fair value and the amount that the
+Group would be contractually required to pay to the holders as at 31 December 2021 and 2020 were not
+significant. In the years of 2021 and 2020, there was no significant change in the Group's credit risk nor
+changes in the fair value of these financial liabilities as a result.
+(18) US Dollar Debt Securities, RMB Debt Securities and other Debt Securities were issued in Chinese
+mainland, Hong Kong (China), Macao (China), Taiwan (China) and other countries and regions between
+2013 and 2021 by the Group, with dates of maturity ranging from 2022 to 2030.
+(17) The claims of the holders of subordinated bonds and tier 2 capital bonds will be subordinated to the claims
+of depositors and general creditors.
+(16) The Bank issued tier 2 capital bonds in an amount of RMB10 billion on 12 November 2021. The bonds
+have a maturity of 15 years, with a fixed coupon rate of 3.80%. The Bank was entitled to redeem the bonds
+at the end of the tenth year.
+(15) The Bank issued tier 2 capital bonds in an amount of RMB40 billion on 12 November 2021. The bonds
+have a maturity of 10 years, with a fixed coupon rate of 3.60%. The Bank was entitled to redeem the bonds
+at the end of the fifth year.
+325
+Value-added tax
+7,459
+6,742
+Interest cost
+2,533
+2,199
+As at 1 January
+2020
+2021
+Year ended 31 December
+The movements of the net liabilities recognised are as follows:
+As at 31 December 2021, the actuarial liabilities existing in relation to the retirement benefit
+obligations for employees who retired prior to 31 December 2003 and the early retirement
+obligations for employees who early-retired were RMB1,881 million (31 December
+2020: RMB1,896 million) and RMB214 million (31 December 2020: RMB303 million),
+respectively, using the projected unit credit method.
+55,665
+45,006
+Retirement benefit obligations
+33
+Total
+768
+772
+Other
+326
+345
+Education surcharges
+492
+539
+City construction and maintenance tax
+31
+1,232,211
+Bonds issued (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(3)
+The subordinated bonds issued on 17 May 2011, have a maturity of 15 years, with a fixed coupon rate of
+5.30%, paid annually. The Bank was entitled to early redeem all the subordinated bonds at the end of the
+tenth year. The Bank has redeemed all the bonds in advance at face value on 19 May 2021.
+The second subordinated bonds issued on 27 November 2012 have a maturity of 15 years, with a fixed
+coupon rate of 4.99%, paid annually. The Bank was entitled to early redeem all these bonds at the end of the
+tenth year. If the Bank does not exercise this option, the coupon rate of the bonds for the remaining 5-year
+period shall remain fixed at 4.99%.
+The Bank issued tier 2 capital bonds in an amount of USD3 billion on 13 November 2014. The bonds have
+a maturity of 10 years, with a fixed coupon rate of 5.00%.
+323
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(2)
+18,142,887
+1,388,678
+Total bonds issued (20)
+6,030
+6,506
+Accrued interest
+1,238,373
+1,382,172
+Subtotal bonds issued
+6,162
+317
+As at 31 December 2021, deferred tax liabilities relating to temporary differences of
+RMB174,351 million associated with the Group's investments in subsidiaries have not been
+recognised (31 December 2020: RMB164,299 million). Refer to Note II.20.2.
+(1)
+1,244,403
+2021
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+324
+(14) The Bank issued tier 2 capital bonds in an amount of RMB 10 billion on 17 March 2021. The bonds have a
+maturity of 15 years, with a fixed coupon rate of 4.38%. The Bank was entitled to redeem the bonds at the
+end of the tenth year.
+(13) The Bank issued tier 2 capital bonds in an amount of RMB 15 billion on 17 March 2021. The bonds have a
+maturity of 10 years with a fixed coupon rate of 4.15%. The Bank was entitled to redeem the bonds at the
+end of the fifth year.
+(12) The Bank issued tier 2 capital bonds in an amount of RMB15 billion on 17 September 2020. The bonds
+have a maturity of 15 years, with a fixed coupon rate of 4.47%. The Bank was entitled to redeem the bonds
+at the end of the tenth year.
+(11) The Bank issued tier 2 capital bonds in an amount of RMB60 billion on 17 September 2020. The bonds
+have a maturity of 10 years, with a fixed coupon rate of 4.20%. The Bank was entitled to redeem the bonds
+at the end of the fifth year.
+(10) The Bank issued tier 2 capital bonds in an amount of RMB30 billion on 20 November 2019. The bonds
+have a maturity of 10 years, with a fixed coupon rate of 4.01%. The Bank was entitled to redeem the bonds
+at the end of the fifth year.
+The Bank issued tier 2 capital bonds in an amount of RMB10 billion on 20 September 2019. The bonds
+have a maturity of 15 years, with a fixed coupon rate of 4.34%. The Bank was entitled to redeem the bonds
+at the end of the tenth year.
+The Bank issued tier 2 capital bonds in an amount of RMB30 billion on 20 September 2019. The bonds
+have a maturity of 10 years, with a fixed coupon rate of 3.98%. The Bank was entitled to redeem the bonds
+at the end of the fifth year.
+The Bank issued tier 2 capital bonds in an amount of RMB40 billion on 9 October 2018. The bonds have a
+maturity of 10 years, with a fixed coupon rate of 4.84%. The Bank was entitled to redeem the bonds at the
+end of the fifth year.
+The Bank issued tier 2 capital bonds in an amount of RMB40 billion on 3 September 2018. The bonds have
+a maturity of 10 years, with a fixed coupon rate of 4.86%. The Bank was entitled to redeem the bonds at the
+end of the fifth year.
+The Bank issued tier 2 capital bonds in an amount of RMB30 billion on 31 October 2017. The bonds have a
+maturity of 10 years, with a fixed coupon rate of 4.45%. The Bank was entitled to redeem the bonds at the
+end of the fifth year.
+(9)
+(8)
+(7)
+(6)
+(5)
+(4) The Bank issued tier 2 capital bonds in an amount of RMB30 billion on 26 September 2017. The bonds
+have a maturity of 10 years, with a fixed coupon rate of 4.45%. The Bank was entitled to redeem the bonds
+at the end of the fifth year.
+Bonds issued (Continued)
+30
+30
+Total due to customers (3)
+329
+222,719
+3,968,527
+- Corporate deposits
+Time deposits
+8,312,644
+8,762,947
+Subtotal
+3,355,893
+3,487,433
+Personal deposits
+4,956,751
+3,621,775
+5,275,514
+2020
+As at 31 December
+2021
+Due to customers
+29
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+185,800
+Demand deposits
+- Personal deposits
+Corporate deposits
+3,854,531
+4,299,050
+16,693,371
+17,920,168
+Subtotal due to customers
+64,042
+77,152
+160,419
+Other deposits (2)
+Certificates of deposit
+634,233
+Accrued interest
+206,146
+Subtotal
+Subtotal
+652,073
+8,267,577
+7,476,306
+- Corporate deposits
+Structured deposits (1)
+254,553
+Personal deposits
+300,628
+379,680
+351,445
+2020
+135,717
+133,648
+2,069
+133,679
+2,294
+135,973
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+2021
+BANK OF CHINA LIMITED
+As at 31 December
+As at 31 December
+Total
+Share premium
+Other capital reserve
+37.2 Capital reserve
+All A and H shares rank pari passu with the same rights and benefits.
+294,387,791,241 294,387,791,241
+Total
+210,765,514,846 210,765,514,846
+83,622,276,395 83,622,276,395
+Domestic listed A shares, par value of RMB1.00 per share
+Overseas listed H shares, par value of RMB 1.00 per share
+2020
+2021
+Unit: Share
+The Bank's share capital is as follows:
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+334
+37 Share capital, capital reserve and other equity instruments (Continued)
+Preference Shares
+For the year ended 31 December 2021, the movements in the Bank's other equity
+instruments were as follows:
+--730.0
+72,979
+730.0
+(Third Tranche) (2)
+37.1 Share capital
+Domestic
+(27,969)
+(280.0)
+27,969
+280.0
+(Second Tranche) (1)
+Preference Shares
+37.3 Other equity instruments
+Domestic
+(million Carrying
+shares)
+amount
+(million Carrying
+(million Carrying
+shares)
+31 December 2021
+Quantity
+Quantity
+Quantity
+Increase/(decrease)
+As at
+1 January 2021
+Preference Shares
+As at
+amount shares) amount
+37 Share capital, capital reserve and other equity instruments
+Exchange differences and other
+V
+25,456
+Allowance for credit commitments (i)
+Allowance for litigation losses (Note V.40.1)
+2020
+As at 31 December
+2021
+(3) Provision
+36 Other liabilities (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+21,893
+19,619
+332
+Lease liabilities
+28,017
+25,370
+Undiscounted lease liabilities
+Over 5 years
+9,161
+8,361
+12,487
+11,082
+6,369
+5,927
+Between 1 to 5 years
+Less than 1 year
+28,767
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+887
+Total
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+333
+Allowance for credit commitments is measured using the ECL model. Credit commitments were
+mainly under Stage 1, and the transfers in balance between stages were not significant during the
+years ended 31 December 2021 and 2020.
+29,492
+26,343
+(285)
+(275)
+(281)
+(251)
+5,589
+(2,623)
+24,469
+29,492
+2020
+Year ended 31 December
+2021
+29,492
+26,343
+(i)
+As at 31 December
+72,979
+Utilised during the year
+(Reversal)/losses for the year
+As at 1 January
+Movements of the provision are as follows:
+725
+Domestic
+39,990
+(Fourth Tranche) (3)
+337
+With the approvals by the relevant regulatory authorities in China, the Bank issued RMB20,000 million
+write-down undated capital bonds in the Chinese mainland interbank bond market on 10 December 2020
+and completed the issuance on 14 December 2020. The denomination of the bonds is RMB100 each, and
+the annual interest rate of the bonds for the first five years is 4.70%, which is reset every 5 years.
+With the approvals by the relevant regulatory authorities in China, the Bank issued RMB30,000 million
+write-down undated capital bonds in the Chinese mainland interbank bond market on 13 November 2020
+and completed the issuance on 17 November 2020. The denomination of the bonds is RMB100 each, and
+the annual interest rate of the bonds for the first five years is 4.55%, which is reset every 5 years.
+With the approvals by the relevant regulatory authorities in China, the Bank issued RMB40,000 million
+write-down undated capital bonds in the Chinese mainland interbank bond market on 28 April 2020 and
+completed the issuance on 30 April 2020. The denomination of the bonds is RMB100 each, and the annual
+interest rate of the bonds for the first five years is 3.40%, which is reset every 5 years.
+With the approvals by the relevant regulatory authorities in China, the Bank issued RMB40,000 million
+write-down undated capital bonds in the Chinese mainland interbank bond market on 25 January 2019
+and completed the issuance on 29 January 2019. The denomination of the bonds is RMB 100 each, and the
+annual interest rate of the bonds for the first five years is 4.50%, which is reset every 5 years.
+(8)
+(7)
+(6)
+(5)
+Capital raised from the issuance of the above preference shares, after deduction of
+transaction costs, was fully used to replenish the Bank's additional tier 1 capital and to
+increase its capital adequacy ratio.
+Save for such dividend at the agreed dividend payout ratio, the holders of the above
+preference shares shall not be entitled to share in the distribution of the remaining profits
+of the Bank together with the holders of the ordinary shares. The above preference shares
+bear non-cumulative dividends. The Bank shall be entitled to cancel any dividend on
+the preference shares, and such cancellation shall not constitute a default. However, the
+Bank shall not distribute profits to ordinary shareholders until resumption of full payment
+of dividends on the preference shares. Upon the occurrence of a triggering event for the
+compulsory conversion of preference shares into ordinary shares in accordance with the
+agreement, the Bank shall convert the preference shares into ordinary shares in whole or in
+part after reporting to the CBIRC for its examination and approval decision.
+37.3 Other equity instruments (Continued)
+BANK OF CHINA LIMITED
+37 Share capital, capital reserve and other equity instruments (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+336
+The Offshore Preference Shares have no maturity date. However, subject to the satisfaction of the
+redemption conditions and the prior approval of the CBIRC, the Bank may at its discretion redeem all or
+part of the Offshore Preference Shares on 4 March 2025 or any dividend payment date thereafter at the
+redemption price representing the sum of the par value of the Offshore Preference Shares and the dividends
+declared but not yet distributed, as calculated and paid in US Dollars.
+With the approvals by the relevant regulatory authorities in China, the Bank issued the US Dollar settled
+non-cumulative Offshore Preference Shares on 4 March 2020. Each Offshore Preference Share has a
+par value of RMB100 and 197,865,300 Offshore Preference Shares were issued in total. The aggregate
+par value of the Offshore Preference Shares is USD2.820 billion as converted into USD using the fixed
+exchange rate (USD1.00 to RMB7.0168). The initial annual dividend rate is 3.60% (after tax) and is subject
+to reset per agreement, but in no case shall exceed 12.15%. The dividends are calculated and paid in US
+Dollars.
+The Domestic Preference Shares have no maturity date. However, subject to the satisfaction of the
+redemption conditions and the prior approval of the CBIRC, the Bank may at its discretion redeem all or
+part of the Domestic Preference Shares after 29 August 2024 at the redemption price representing the sum
+of the par value of the Domestic Preference Share and the dividends declared but not yet distributed.
+With the approvals by the relevant regulatory authorities in China, the Bank issued non-cumulative
+Domestic Preference Shares on 26 August 2019, in the aggregate par value of RMB27 billion. Each
+Domestic Preference Share has a par value of RMB100 and 270 million Domestic Preference Shares were
+issued in total. The dividend rate of the shares for the first five years is 4.35% (pre-tax), which is reset
+every 5 years.
+The Domestic Preference Shares have no maturity date. However, subject to the satisfaction of the
+redemption conditions and the prior approval of the CBIRC, the Bank may at its discretion redeem all or
+part of the Domestic Preference Shares after 27 June 2024 at the redemption price representing the sum of
+the par value of the Domestic Preference Share and the dividends declared but not yet distributed.
+With the approvals by the relevant regulatory authorities in China, the Bank issued non-cumulative
+Domestic Preference Shares on 24 June 2019, in the aggregate par value of RMB73 billion. Each Domestic
+Preference Share has a par value of RMB100 and 730 million Domestic Preference Shares were issued in
+total. The dividend rate of the shares for the first five years is 4.50% (pre-tax), which is reset every 5 years.
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+339
+The regulatory reserve mainly refers to the reserve amount set aside by BOC Hong Kong
+(Group) Limited (“BOCHK Group”), a subsidiary of the Group, for general banking risks,
+including future losses or other unforeseeable risks. As at 31 December 2021 and 2020,
+the reserve amounts set aside by BOCHK Group were RMB3,866 million and RMB3,105
+million, respectively.
+In accordance with a resolution dated 29 March 2022, the Board of Directors of the Bank
+approved the appropriation of RMB31,439 million to the general reserve for the year ended
+31 December 2021 (2020: RMB20,822 million).
+According to Caijin [2012] No. 20 Requirements on Impairment Allowance for Financial
+Institutions (the “Requirement"), issued by the MOF, in addition to the impairment
+allowance, the Bank establishes a general reserve to address unidentified potential
+impairment losses. The general reserve as a distribution of profits, being part of the equity,
+should not be less than 1.5% of the aggregate amount of risk assets as defined by the
+Requirement, and the minimum threshold can be accumulated over a period of no more than
+five years.
+38.2 General and regulatory reserves
+In addition, some operations in Hong Kong (China), Macao (China), Taiwan (China) and
+other countries and regions are required to appropriate certain percentages of their net
+profits to the statutory surplus reserves as stipulated by local banking authorities.
+In accordance with a resolution of the Board of Directors dated 29 March 2022, the Bank
+appropriated 10% of the net profit for the year ended 31 December 2021 to the statutory
+surplus reserves, amounting to RMB19,396 million (2020: RMB17,720 million).
+Under relevant PRC laws, the Bank is required to appropriate 10% of its net profit to non-
+distributable statutory surplus reserves. The appropriation to the statutory surplus reserves
+may cease when such reserves has reached 50% of the share capital. Subject to the approval
+of the Annual General Meeting, the statutory surplus reserves can be used for replenishing
+the accumulated losses or increasing the Bank's share capital. The statutory surplus reserves
+amount used to increase the share capital is limited to a level where the statutory surplus
+reserves after such capitalisation is not less than 25% of the share capital.
+38.1 Statutory reserves
+38 Statutory reserves, general and regulatory reserves and undistributed profits
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+338
+Capital raised from the issuance of the perpetual bonds, after deduction of transaction costs,
+was fully used to replenish the Bank's additional tier 1 capital and to increase its capital
+adequacy ratio.
+The perpetual bonds bear non-cumulative interest and the Bank shall have the right to cancel
+distributions on the perpetual bonds in whole or in part and such cancellation shall not
+constitute a default. The Bank may at its discretion utilise the proceeds from the cancelled
+distributions to meet other obligations of maturing debts. The Bank shall not distribute
+profits to ordinary shareholders until the resumption of full interest payment to the holders
+of the perpetual bonds.
+The duration of the above bonds is the same as the period of continuing operation of the
+Bank. Subject to the satisfaction of the redemption conditions and having obtained the
+prior approval of the CBIRC, the Bank may redeem the above bonds in whole or in part on
+each distribution payment date 5 years after the issuance date of the above bonds. Upon the
+occurrence of a triggering event for the write-downs, with the consent of the CBIRC and
+without the consent of the bondholders, the Bank has the right to write down all or part of
+the above bonds issued and existing at that time in accordance with the total par value. The
+claims of the holders of the above bonds will be subordinated to the claims of depositors,
+general creditors and subordinated creditors; and shall rank in priority to the claims of all
+types of shareholders and will rank pari passu with the claims under any other additional tier
+1 capital instruments of the Bank that rank pari passu with the above bonds.
+(10) With the approvals by the relevant regulatory authorities in China, the Bank issued RMB20,000 million
+write-down undated capital bonds in the Chinese mainland interbank bond market on 25 November 2021
+and completed the issuance on 29 November 2021. The denomination of the bonds is RMB100 each, and
+the annual interest rate of the bonds for the first five years is 3.64%, which is reset every 5 years.
+(9) With the approvals by the relevant regulatory authorities in China, the Bank issued RMB50,000 million
+write-down undated capital bonds in the Chinese mainland interbank bond market on 17 May 2021 and
+completed the issuance on 19 May 2021. The denomination of the bonds is RMB 100 each, and the annual
+interest rate of the bonds for the first five years is 4.08%, which is reset every 5 years.
+37.3 Other equity instruments (Continued)
+Share capital, capital reserve and other equity instruments (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+37
+V
+With the approvals by the relevant regulatory authorities in China, the Bank fully redeemed 280 million
+Domestic Preference Shares (Second Tranche) on 15 March 2021. The Bank fully paid the nominal value of
+the Domestic Preference Shares and the dividends declared, totalling RMB29,540 million.
+(4)
+(3)
+(2)
+(7)
+Bonds (Series 2)
+2020 Undated Capital
+2020
+39,990
+Bonds (Series 1) (6)
+2020 Undated Capital
+39,992
+39,992
+Bonds (Series 1) (5)
+2019 Undated Capital
+Perpetual Bonds
+119,550
+(280.0) (27,969) 1,197.9
+147,519
+1,477.9
+Subtotal
+19,581
+197.9
+19,581
+197.9
+(Second Tranche) (4)
+Preference Shares
+Offshore
+-- 270.0 26,990
+26,990
+270.0
+29,994
+Preference Shares
+2020 Undated Capital
+19,995
+(1)
+37.3 Other equity instruments (Continued)
+37 Share capital, capital reserve and other equity instruments (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+335
+319,505
+42,015
+277,490
+Total
+199,955
+69,984
+129,971
+Subtotal
+19,995
+19,995
+Bonds (Series 2) (10)
+2021 Undated Capital
+49,989
+49,989
+Bonds (Series 1) (9)
+2021 Undated Capital
+19,995
+Bonds (Series 3) (8)
+2021
+29,994
+The Group's lease liabilities are analysed by the maturity date - undiscounted analysis
+As at
+As at
+Salary and welfare payables
+(1)
+410,373
+436,555
+Total
+92,236
+112,708
+Other
+11,532
+6,362
+1 January
+Deferred income
+26,343
+Provision (3)
+21,893
+19,619
+Lease liabilities (2)
+34,179
+39,685
+Salary and welfare payables (¹)
+78,940
+68,229
+Items in the process of clearance and settlement
+9,670
+29,492
+31 December
+2021
+Accrual
+5
+10
+(5,603)
+3,527
+2,086
+230
+(6,179)
+6,205
+204
+1,525
+(3,883)
+3,932
+1,476
+(4,664)
+31,051
+(61,656)
+68,798
+4,664
+- Unemployment
+- Annuity
+Pension
+― Medical
+Social insurance
+Staff welfare
+23,909
+Salary, bonus and subsidy
+2021
+Payment
+9,932
+213
+Non-life insurance contracts
+153,677
+52,417
+44,169
+As at 31 December
+(366)
+11
+Other
+(62)
+(1,557)
+14,268
+(6,702)
+(Charged)/credited to the income statement (Note V.10)
+Charged to other comprehensive income
+38,577
+35.4 Breakdowns of deferred income tax credit/(charge) in the income statement are as follows:
+52,417
+2020
+2021
+Year ended 31 December
+35.3 Movements of the deferred income tax are as follows:
+35 Deferred income taxes (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+As at 31 December
+As at 1 January
+Year ended 31 December
+2021
+2020
+Life insurance contracts
+2020
+2021
+As at 31 December
+Insurance liabilities
+36 Other liabilities
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+330
+14,268
+(6,702)
+Total
+922
+(2,696)
+(40)
+1,768
+Pension, retirement benefits and salary payables
+Other temporary differences
+1,196
+(10,908)
+financial instruments
+Financial instruments at fair value through
+Asset impairment allowances
+12,190
+5,134
+132,431
+(212)
+profit or loss and derivative
+- Injury at work
+136
+3
+- Maternity insurance
+1
+(60)
+59
+2
+- Injury at work
+5
+(151)
+150
+6
+(136)
+- Unemployment
+(3,495)
+3,440
+2,141
+204
+(4,562)
+4,607
+159
+- Annuity
+Pension
+1,476
+(3,228)
+3,109
+2,086
+3
+Housing funds
+39
+Lease liabilities
+6
+(2)
+There was no overdue payment for staff salary and welfare payables as at 31 December 2021 and
+2020.
+(i)
+34,179
+(88,478)
+89,284
+33,373
+Total (i)
+653
+24
+(23)
+(4,259)
+28
+4,304
+608
+Other
+19
+of labour contract
+5,782
+(1,436)
+2,082
+5,136
+staff education fee
+Labour union fee and
+36
+(4,777)
+4,774
+1,595
+Medical
+Reimbursement for cancellation
+(4,218)
+(30)
+(4,648)
+29
+4,674
+653
+Other
+24
+of labour contract
+Reimbursement for cancellation
+6,126
+(1,708)
+2,052
+5,782
+staff education fee
+Labour union fee and
+30
+(4,946)
+4,940
+Housing funds
+3
+(135)
+135
+3
+- Maternity insurance
+2
+(80)
+_
+81
+1
+23
+679
+36
+34,179
+Staff welfare
+Social insurance
+4,218
+Total (i)
+23,909
+(62,133)
+62,377
+23,665
+2020
+Payment
+Accrual
+31 December
+1 January
+2020
+As at
+Salary, bonus and subsidy
+(1) Salary and welfare payables (Continued)
+(93,744)
+As at
+99,250
+331
+BANK OF CHINA LIMITED
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+36
+Other liabilities (Continued)
+39,685
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Ordinary share cash dividend of RMB57,994 million (pre-tax) in respect of the profit for the
+year ended 31 December 2020 was approved by the shareholders of the Bank at the Annual
+General Meeting held on 20 May 2021 and was distributed during the year.
+Ordinary share cash dividend of RMB2.21 per ten shares (pre-tax) in respect of the profit
+for the year ended 31 December 2021 (2020: RMB1.97 per ten shares), amounting to a
+total dividend of RMB65,060 million (pre-tax), based on the number of shares issued
+as at 31 December 2021 will be proposed for approval at the forthcoming 2021 Annual
+General Meeting and the dividend payable is not reflected in the liabilities of the financial
+38.3 Dividends
+38 Statutory reserves, general and regulatory reserves and undistributed profits (Continued)
+Dividends for Ordinary Shares
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+14,009
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+BANK OF CHINA LIMITED
+13,132
+13,153
+statements.
+12,748
+14,611
+V
+Dividends for Preference Shares
+The Bank distributed interest on the 2019 Undated Capital Bonds (Series 1) amounting to
+RMB 1,800 million on 29 January 2021.
+Dividend distribution of Offshore Preference Shares (Second Tranche) was approved by the
+Board of Directors of the Bank at the Board Meeting held on 29 October 2021. Dividend of
+Offshore Preference Shares (Second Tranche) amounting to USD101.5 million (after tax)
+was distributed on 4 March 2022 and was recorded in other liabilities as at 31 December
+2021.
+2020
+2021
+11,765
+As at 31 December
+Non-controlling interests of the subsidiaries of the Group are as follows:
+39 Non-controlling interests
+The Bank distributed interest on the 2020 Undated Capital Bonds (Series 3) amounting to
+RMB940 million on 14 December 2021.
+The Bank distributed interest on the 2020 Undated Capital Bonds (Series 2) amounting to
+RMB1,365 million on 17 November 2021.
+The Bank distributed interest on the 2020 Undated Capital Bonds (Series 1) amounting to
+RMB1,360 million on 30 April 2021.
+Interest on Perpetual Bonds
+38.3 Dividends (Continued)
+38 Statutory reserves, general and regulatory reserves and undistributed profits (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+340
+Dividend distributions of Domestic Preference Shares (Third Tranche and Fourth Tranche)
+were approved by the Board of Directors of the Bank at the Board Meeting held on 29 April
+2021. Dividend of Domestic Preference Shares (Third Tranche) amounting to RMB3,285
+million (pre-tax) was distributed on 28 June 2021. Dividend of Domestic Preference Shares
+(Fourth Tranche) amounting to RMB1, 174.5 million (pre-tax) was distributed on 30 August
+2021.
+13,473
+Letters of guarantee issued (2)
+12,529
+Undrawn credit card limits
+1,044,469
+1,060,580
+1,086,152
+1,035,517
+Bank bill acceptance
+378,118
+301,602
+1,417,031
+Letters of credit issued
+154,181
+Accepted bills of exchange under letters of credit
+Other
+80,958
+81,817
+243,974
+178,944
+BOC Hong Kong (Group) Limited
+Total (3)
+171,018
+1,898,072
+262,001
+318,393
+49,901
+55,771
+110,517
+123,525
+The Bank is entrusted by the MOF to underwrite certain Treasury bonds. The investors of
+these Treasury bonds have a right to redeem the bonds at any time prior to maturity and the
+Bank is committed to redeem these Treasury bonds. The MOF will not provide funding for
+the early redemption of these Treasury bonds on a back-to-back basis but will pay interest
+and repay the principal at maturity. The redemption price is the principal value of the bonds
+plus unpaid interest in accordance with the early redemption arrangement.
+As at 31 December 2021, the outstanding principal value of the Treasury bonds sold by the
+Bank under obligation to redeem prior to maturity amounted to RMB54,053 million (31
+December 2020: RMB55,597 million). The original maturities of these Treasury bonds vary
+from 3 to 5 years and management expects the amount of redemption through the Bank prior
+to the maturity dates of these bonds will not be material.
+344
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+40 Contingent liabilities and commitments (Continued)
+40.7 Credit commitments
+As at 31 December
+2021
+2020
+Loan commitments (¹)
+with an original maturity of less than 1
+with an original maturity of 1 year or above
+year
+11,080
+93,924
+1,242
+Bank of China Group Investment Limited
+1,252
+686
+Total
+Investment properties and others
+Contracted but not provided for
+199
+155
+1,442
+- Contracted but not provided for
+Authorised but not contracted for
+38,646
+Intangible assets
+1,992
+- Authorised but not contracted for
+46,723
+34,371
+- Contracted but not provided for
+2020
+2021
+As at 31 December
+3,468
+Property and equipment
+52,884
+BANK OF CHINA LIMITED
+5,221,154
+2021
+As at 31 December
+40.6 Treasury bonds redemption commitments
+Total
+Over 5 years
+Between 4 to 5 years
+Between 3 to 4 years
+343
+Between 2 to 3 years
+Less than 1 year
+The Group acts as lessor in operating leases principally through aircraft leasing undertaken
+by its subsidiary BOC Aviation Limited. Under irrevocable operating lease contracts, the
+minimum lease payments which will be received by the Group under the operating leases for
+existing aircraft and aircraft yet to be delivered amounted to:
+40.5 Operating leases
+40 Contingent liabilities and commitments (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Between 1 to 2 years
+40.4 Capital commitments
+The Group accepts securities as collateral that are permitted to be sold or re-pledged in
+connection with reverse repurchase and derivative agreements with banks and other financial
+institutions. As at 31 December 2021, the fair value of collateral received from banks and
+other financial institutions accepted by the Group amounted to RMB299,137 million (31
+December 2020: RMB151,204 million). As at 31 December 2021, the fair value of the
+collateral that the Group had sold or re-pledged, but was obligated to return, was RMB2,384
+million (31 December 2020: RMB797 million). These transactions are conducted under
+standard terms in the normal course of business.
+40.3 Collateral accepted
+40 Contingent liabilities and commitments
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+124,418
+125,400
+40.1 Legal proceedings and arbitration
+341
+8,982
+9,395
+Other
+9,878
+10,234
+Tai Fung Bank Limited
+11,069
+11,847
+Total
+As at 31 December 2021, the Group was involved in certain litigation and arbitration cases
+in the regular course of its business. In the Group's regular business operations in different
+countries and regions across the world, give the range and scale of its international presence,
+the Group may be involved in a variety of litigation, arbitration and judicial proceedings
+within different jurisdictions, and the ultimate outcomes of these proceedings involve
+various levels of uncertainty. The management makes provisions for potential losses that
+may arise from these uncertainties based on assessments of potential liabilities, courts'
+judgements or the opinions of legal counsel, and as at 31 December 2021, the balance of
+the provisions was RMB887 million (31 December 2020: RMB725 million), as discussed
+in Note V.36. Based upon the opinions of internal and external legal counsels, the senior
+management of the Group believes that, at the current stage, these matters will not have
+a material impact on the financial position or operating results of the Group. Should
+the ultimate outcomes of these matters differ from the initially estimated amounts, such
+differences will impact the profit or loss in the period during which such a determination is
+made.
+40.2 Assets pledged
+40 Contingent liabilities and commitments (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+668,363
+1,052,305
+2,127
+1,778
+666,236
+1,050,527
+2020
+As at 31 December
+2021
+342
+Total
+Bills
+Debt securities
+Assets pledged by the Group as collateral mainly for placement, repurchase, short positions,
+derivative transactions with other banks and financial institutions and for local statutory
+requirements are set forth in the table below. These transactions are conducted under
+standard and normal business terms.
+94,489
+4,491,673
+85,650
+(2)
+Financial investments
+498,044
+390,508
+Derivative financial assets
+7,407
+18,863
+Loans and advances to customers
+64,341
+144,640
+Due to customers, banks and other financial institutions
+Placements from banks and other financial institutions
+(256,582)
+(135,319)
+(137,131)
+Derivative financial liabilities
+(8,561)
+(21,294)
+47,175
+32,177
+(259,277)
+Credit commitments
+210,826
+Placements with and loans to banks and
+(229)
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+42 Related party transactions (Continued)
+42.2 Transactions with Huijin and companies under Huijin (Continued)
+other financial institutions
+(3) Transactions with companies under Huijin
+In the normal course of business, main transactions that the Group entered into with the
+affiliates of Huijin are as follows:
+Transaction balances
+As at 31 December
+2021
+2020
+Due from banks and other financial institutions
+101,654
+126,104
+Companies under Huijin include its equity interests in subsidiaries, associates and joint
+ventures in certain other bank and non-bank entities in the PRC. The Group enters into
+banking transactions with these companies in the normal course of business on commercial
+terms which include mainly purchase and sale of debt securities, money market transactions
+and derivative transactions.
+Transaction amounts
+Interest income
+Interest expense
+other financial institutions
+Placements from banks and
+other financial institutions
+0.00%-5.50%
+Year ended 31 December
+2021
+2020
+0.00%-5.20%
+-0.48%-6.50% -0.21%-27.00%
+Due to customers, banks and
+-0.58%-5.98% -0.05%-5.98%
+-0.60%-5.22% -0.50%-6.00%
+-0.53%-5.50%
+-0.50%-4.80%
+42.3 Transactions with government authorities, agencies, affiliates and other State-controlled
+entities
+The State Council of the PRC government directly and indirectly controls a significant
+number of entities through its government authorities, agencies, affiliates and other State-
+controlled entities. The Group enters into extensive banking transactions with these entities
+in the normal course of business on commercial terms.
+Transactions conducted with government authorities, agencies, affiliates and other State-
+controlled entities include the purchase and redemption of investment securities issued by
+government agencies, underwriting and distribution of treasury bonds issued by government
+agencies through the Group's branch network, foreign exchange transactions and derivative
+transactions, lending, provision of credit and guarantees and deposit placing and taking.
+349
+11,870
+0.15%-4.75% 0.18%-9.91%
+Loans and advances to customers
+Financial investments
+other financial institutions
+348
+Year ended 31 December
+2021
+2020
+14,657
+12,561
+(7,042)
+(4,313)
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+42 Related party transactions (Continued)
+42.2 Transactions with Huijin and companies under Huijin (Continued)
+(3) Transactions with companies under Huijin (Continued)
+Interest rate ranges
+Due from banks and other financial institutions
+Placements with and loans to banks and
+(652)
+(1)
+1,028
+2020
+For the purpose of the consolidated statement of cash flows, cash and cash equivalents
+comprise the following balances with an original maturity of less than three months:
+As at 31 December
+2021
+2020
+Cash and due from banks and other financial institutions
+400,769
+453,505
+Balances with central banks
+Note to the consolidated statement of cash flows
+740,092
+Placements with and loans to banks and
+other financial institutions
+689,909
+361,872
+Financial investments
+144,861
+92,378
+Total
+587,113
+42 Related party transactions
+As at 31 December 2021, the firm commitment in underwriting securities of the Group
+amounted to RMB600 million (31 December 2020: Nil).
+40.8 Underwriting obligations
+(3)
+Loan commitments mainly represent undrawn loan facilities agreed and granted to customers.
+Unconditionally revocable loan commitments are not included in loan commitments. As at 31 December
+2021, the unconditionally revocable loan commitments of the Group amounted to RMB338,647 million (31
+December 2020: RMB334,384 million).
+Letters of guarantee issued mainly include financial guarantees and performance guarantees. The
+obligations on the Group to make payments are dependent on the outcome of a future event.
+Risk-weighted assets for credit risk of credit commitments
+The risk-weighted assets for credit risk of the Group are calculated in accordance with the Capital Rules for
+Commercial Banks (Provisional) and other relevant regulations under the advanced capital measurement
+approaches. The amounts are determined by the creditworthiness of the counterparties, the maturity
+characteristics of each type of contract and other factors.
+Credit commitments
+345
+As at 31 December
+41
+2021
+1,266,950
+1,186,895
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+40 Contingent liabilities and commitments (Continued)
+2020
+1,975,631
+1,494,868
+42.1 CIC was established on 29 September 2007 with registered capital of RMB1,550
+billion. CIC is a wholly state-owned company engaging in foreign currency investment
+management. The Group is subject to the control of the State Council of the PRC
+Government through CIC and its wholly owned subsidiary, Huijin.
+Unified social credit code
+(2) Transactions with Huijin
+Investment in major State-owned financial
+institutions on behalf of the State Council;
+other related businesses approved
+by the State Council
+911000007109329615
+The Group enters into banking transactions with Huijin in the normal course of its business
+on commercial terms. Purchase of the bonds issued by Huijin was in the normal course of
+business and in compliance with the requirements of the related regulations and corporate
+governance.
+Transaction balances
+Investment in debt securities
+Due to Huijin
+Transaction amounts
+Principal activities
+Interest income
+347
+As at 31 December
+2021
+2020
+37,842
+(40,617)
+43,659
+(18,047)
+Year ended 31 December
+2021
+Interest expense
+Wholly State-owned company
+64.02%
+Voting rights in the Bank
+Nature
+The Group entered into banking transactions with CIC in the normal course of its business
+on commercial terms.
+346
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+42 Related party transactions (Continued)
+42.2 Transactions with Huijin and companies under Huijin
+(1) General information of Huijin
+Central Huijin Investment Ltd.
+Legal representative
+PENG Chun
+Registered capital
+RMB828,209 million
+Location of registration
+Beijing
+Capital shares in the Bank
+64.02%
+1,170
+2020
+19,305
+1,264,319
+Personal banking - Services to retail customers including savings deposits, personal loans,
+credit cards and debit cards, payments and settlements, wealth management products and
+funds and insurance agency services.
+-
+Services to corporate customers, government authorities and
+financial institutions including current accounts, deposits, overdrafts, loans, payments and
+settlements, trade-related products and other credit facilities, foreign currency, derivative
+products and wealth management products.
+Corporate banking
+Business segments
+Corporate and personal banking services are provided in
+other countries and regions. Significant locations include New York, London, Singapore and
+Tokyo.
+-
+Other countries and regions
+Hong Kong (China), Macao (China) and Taiwan (China) — Corporate banking, personal
+banking, treasury operations, investment banking and insurance services are performed in
+Hong Kong (China), Macao (China) and Taiwan (China). The business of this segment is
+centralised in BOCHK Group.
+insurance services, etc. are performed in Chinese mainland.
+Corporate banking, personal banking, treasury operations and
+-
+Chinese mainland
+Geographical segments
+43 Segment reporting (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+355
+Measurement of segment assets, liabilities, income, expenses, results and capital expenditure
+is based on the Group's accounting policies. The segment information presented includes
+items directly attributable to a segment as well as those that can be allocated on a reasonable
+basis. Funding is provided to and from individual business segments through treasury
+operations as part of the asset and liability management process. The pricing of these
+transactions is based on market rates. The transfer price takes into account the specific
+features and maturities of the products. Internal transactions are eliminated on consolidation.
+The Group regularly examines the transfer price and adjusts the price to reflect the current
+situation.
+The Group manages the business from both geographic and business perspectives. From the
+geographic perspective, the Group operates in three principal regions: Chinese mainland;
+Hong Kong (China), Macao (China) and Taiwan (China); and other countries and regions.
+From the business perspective, the Group provides services through six main business
+segments: corporate banking, personal banking, treasury operations, investment banking,
+insurance and other operations.
+Segment reporting
+For certain subsidiaries listed above, the discrepancy between the percentage of voting
+rights and the percentage of effective equity holding is mainly due to the impact of indirect
+holdings.
+Treasury operations
+BOCHK and BOC International Holdings Limited ("BOCI”), in which the Group holds 66.06% and 100%
+of their equity interests, respectively, hold 66% and 34% equity interests of BOC Group Trustee Company
+Limited, respectively.
+Consisting of foreign exchange transactions, customer-based interest
+rate and foreign exchange derivative transactions, money market transactions, proprietary
+trading and asset and liability management. The results of this segment include the inter-
+segment funding income and expenses, results from interest-bearing assets and liabilities;
+and foreign currency translation gains and losses.
+Consisting of debt and equity underwriting and financial advisory,
+sales and trading of securities, stock brokerage, investment research and asset management
+services, and private equity investment services.
+Interest expense
+Interest income
+Total
+Elimination
+and regions
+Subtotal
+Other
+Group
+mainland
+Other countries
+BOCHK
+Chinese
+Hong Kong (China), Macao (China) and Taiwan (China)
+As at and for the year ended 31 December 2021
+43 Segment reporting (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+356
+Other operations of the Group comprise investment holding business, leasing
+business and other miscellaneous activities, none of which constitutes a separately
+reportable segment.
+Other
+Insurance
+services.
+Underwriting of general and life insurance business and insurance agency
+Investment banking
+Net interest income
+BOCHK (Holdings) and BOC Aviation Limited are listed on the Stock Exchange of Hong Kong Limited.
+(3)
+66.06
+HKD565
+66.06
+66.06
+HKD52,864
+HKD43,043
+16 October 1964
+9 September 1980
+Hong Kong, China
+Hong Kong, China
+BOC Credit Card (International) Limited
+Bank of China (Hong Kong) Limited (3)
+12 September 2001
+Hong Kong, China
+Bank of China Hong Kong (Holdings) Limited (2)
+Indirectly held
+92.59
+RMB 10,800
+18 June 2020
+Chongqing
+BOC Financial Leasing Co., Ltd.
+100.00
+RMB 10,000
+1 July 2019
+Beijing
+BOC Wealth Management Co., Ltd.
+100.00
+RMB14,500
+BOC Group Trustee Company Limited (3)
+BOC Aviation Limited (2)
+These directly held principal subsidiaries are unlisted companies. All holdings are in the ordinary share
+capital of the undertaking concerned, and the ability of the subsidiaries to transfer funds to the Group and
+the Bank is not restricted.
+Hong Kong, China
+HKD200
+(2)
+(1)
+43
+42.8 Transactions with subsidiaries (Continued)
+42 Related party transactions (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+Credit card services
+Investment holding
+Aircraft leasing
+Holding company
+Commercial banking
+Debt-to-equity swaps and
+other supporting businesses.
+Issuance of wealth management products,
+investment and management of
+entrusted assets for investors
+Financial leasing
+Insurance services
+Commercial banking
+Commercial banking
+Investment holding
+Insurance services
+Holding company
+Investment banking
+Principal business
+70.00
+USD1,158
+25 November 1993
+Singapore
+77.60
+1 December 1997
+Fee and commission income
+722,469
+34,203
+(99,622)
+Impairment losses on assets
+(226,355)
+2,606
+(7,843)
+(57,445)
+(30,747)
+(26,698)
+(163,673)
+(1)
+Operating expenses
+605,717
+(2,548)
+20,312
+106,908
+52,947
+53,961
+481,045
+Operating income
+67,661
+(1,192)
+236
+49,556
+35,352
+14,204
+(1,778)
+19,061
+(2,539)
+(281)
+(49,281)
+Income tax expense
+276,620
+58
+12,188
+45,845
+20,601
+25,244
+218,529
+Profit before income tax
+1,478
+699
+940
+(241)
+779
+Share of results of associates and joint ventures
+275,142
+58
+12,188
+45,146
+19,661
+25,485
+217,750
+Operating profit
+(104,220)
+(4,317)
+Other operating income (1)
+3,197
+217
+Fee and commission expense
+94,453
+(8,083)
+6,183
+19,426
+7,672
+11,754
+76,927
+425,142
+15,183
+34,053
+6,743
+27,310
+375,906
+789,488
+(364,346)
+12,243
+(6,867)
+(23,159)
+(16,266)
+(6,893)
+(346,563)
+(12,243)
+22,050
+57,212
+23,009
+(12,587)
+(2,492)
+(2,454)
+(4,946)
+1,238
+314
+924
+1,742
+Net gains on transfers of financial asset
+28,291
+(3)
+717
+7,581
+5,320
+2,261
+19,996
+100.00
+Net trading gains
+357
+81,426
+(1,353)
+3,959
+14,480
+5,218
+9,262
+64,340
+Net fee and commission income
+(13,027)
+6,730
+(2,224)
+57
+Profit for the year
+RMB4,535
+GBP250
+Note (1)
+16.44
+91510500711880825C
+PRC
+Sichuan Lutianhua Co., Ltd.
+RMB 100
+20.00
+20.00
+91110000717827478Q
+PRC
+CGN Phase I Private Equity Fund Company Limited
+RMB20,000
+Note (1)
+8.86
+91210800121119657C
+PRC
+Equity investment, project investment, investment management,
+investment consulting
+Investment holding
+Investment in non-securities business; equity investment;
+investment management and consulting
+Securities brokerage; securities investment consulting; financial
+advisory services related to securities trading and securities
+investment activities; securities underwriting and sponsorship;
+securities proprietary business; securities assets management;
+securities investment fund sales agency; margin financing and
+securities lending; distribution of financial products; management
+of publicly offered securities investment funds
+Terminals and other port facilities services, cargo handling,
+warehousing services, ship and port services, leasing and
+maintenance services of port facilities and equipment and port
+machinery, etc.
+Investment in nuclear power projects and related industries; assets
+management; investment consulting
+RMB1,568 Chemical industry, mainly produces and sells all kinds of fertilizers
+and chemical products
+Investment
+Real estate development and operations; property management;
+non-residential real estate leasing; parking services
+Principal business
+Ying Kou Port Group CORP.
+RMB2,778
+33.42
+33.42
+91310000736650364G
+Graceful Field Worldwide Limited
+PRC
+BVI
+80.00
+BANK OF CHINA LIMITED
+Equity investment; industrial investment
+In accordance with the respective articles of association, the Group has significant influence or joint control over these companies.
+(1)
+N/A
+28.57
+21.20
+91340202MA2RENJEX9
+PRC
+Wuhu Yinsheng Special Steel Investment
+Management Limited Partnership
+USD0.00002
+RMB88,500
+50.00
+Note (1)
+9.00
+PRC 91310000MA1FL7AXXR
+National Green Development Fund
+50.00
+N/A
+BVI
+Wkland Investments II Limited
+USD0.0025
+RMB2,400
+Note (1)
+75.00
+PRC 91310000MA1H3FM95L
+Shanghai Chenggang Real Estate Co., Ltd.
+Note (1)
+N/A
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BOC International (China) Co., Ltd.
+25.70
+Year ended 31 December
+350
+Interest expense
+Interest income
+Transaction amounts
+23,144
+27,408
+(10,641)
+(16,285)
+Due to customers, banks and other financial institutions
+Credit commitments
+18,502
+18,935
+Loans and advances to customers
+2020
+2021
+As at 31 December
+Transaction balances
+The Group enters into banking transactions with associates and joint ventures in the normal
+course of business on commercial terms. These include loans and advances, deposit taking
+and other normal banking businesses. The main transactions that the Group entered into with
+associates and joint ventures are as follows:
+42.4 Transactions with associates and joint ventures
+42 Related party transactions (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+2021
+RMB45,000
+2020
+772
+25.70
+91110102MA01W7X36U
+PRC
+China Insurance Investment Fund CO., Ltd.
+(in millions)
+(%)
+(%)
+Paid-in capital
+Voting right
+Effective
+equity held
+Unified Social
+Credit Code
+Place of
+incorporation/
+establishment
+Name
+The general information of principal associates and joint ventures is as follows:
+42.4 Transactions with associates and joint ventures (Continued)
+Related party transactions (Continued)
+42
+351
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+(316)
+674
+(374)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+100.00
+HKD34,806
+12 September 2001
+Hong Kong, China
+BOC Hong Kong (Group) Limited
+(%)
+Voting right
+equity held
+(%)
+(in millions)
+capital
+Effective
+Paid-in
+Date of
+incorporation/
+establishment
+Place of
+incorporation
+and operation
+The general information of the principal subsidiaries is as follows:
+42.8 Transactions with subsidiaries (Continued)
+Directly held (1)
+Name
+Related party transactions (Continued)
+42
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+354
+BANK OF CHINA LIMITED
+BOC International Holdings Limited (3)
+Hong Kong, China
+24 September 2007
+5 January 2005
+16 November 2017
+Beijing
+BOC Financial Asset Investment Company Limited
+Beijing
+BOC Insurance Company Limited
+United Kingdom
+Bank of China (UK) Limited
+50.31
+MOP1,000
+1942
+Macao, China
+Tai Fung Bank Limited
+100.00
+HKD34,052
+18 May 1993
+Hong Kong, China
+Bank of China Group Investment Limited
+100.00
+HKD3,749
+23 July 1992
+Hong Kong, China
+Bank of China Group Insurance Company Limited
+100.00
+HKD3,539
+10 July 1998
+54
+(1,209)
+(2,111)
+2,304
+42 Related party transactions (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+352
+The total compensation packages for the key management personnel for the year ended 31 December 2021
+have not yet been finalised in accordance with the relevant regulations of the PRC authorities. The amount
+of the compensation not provided for is not expected to have any significant impact on the Group's 2021
+financial statements. The final compensation for the year ended 31 December 2021 will be disclosed in a
+separate announcement when determined.
+16
+12
+(1)
+Total
+1
+15
+2020
+2021
+Year ended 31 December
+Compensation for short-term employment benefits (¹)
+Compensation for post-employment benefits
+The key management compensation for the years ended 31 December 2021 and 2020
+comprises:
+The Group enters into banking transactions with key management personnel in the normal
+course of business. During the years ended 31 December 2021 and 2020, there were no
+material transactions and balances with key management personnel on an individual basis.
+Key management personnel are those persons having authority and responsibility for
+planning, directing and controlling the activities of the Group, directly or indirectly,
+including Directors and Executive Officers.
+42.6 Transactions with key management personnel
+Apart from the obligations for defined contributions to the Annuity Fund and normal
+banking transactions, no other transactions were conducted between the Group and the
+Annuity Fund for the years ended 31 December 2021 and 2020.
+42.5 Transactions with the Annuity Fund
+42 Related party transactions (Continued)
+42.7 Transactions with Connected Natural Persons
+As at 31 December 2021, the Bank's balance of loans to the connected natural persons
+as defined in the "Administration of Connected Transactions between Commercial Banks
+and Their Insiders and Shareholders" issued by the former China Banking Regulatory
+Commission and the "Administrative Measures for the Disclosure of Information of Listed
+Companies" issued by China Securities Regulatory Commission totalled RMB352 million
+(31 December 2020: RMB365 million) and RMB14 million (31 December 2020: RMB20
+million), respectively.
+42.8 Transactions with subsidiaries
+The main transactions with subsidiaries are as follows:
+2,747
+2020
+2021
+Year ended 31 December
+353
+Interest expense
+Interest income
+Transaction amounts
+(28,057)
+(40,061)
+other financial institutions
+Placements from banks and
+100.00
+(190,167)
+Due to banks and other financial institutions
+184,792
+273,438
+other financial institutions
+Placements with and loans to banks and
+31,487
+98,768
+Due from banks and other financial institutions
+2020
+2021
+As at 31 December
+Transaction balances
+(200,982)
+227,339
+BANK OF CHINA LIMITED
+21,471,302
+26,472
+28,065
+309
+Depreciation and amortisation
+Credit commitments
+19,056
+3,753,654
+1,972
+310,620
+6,097
+145,806
+8,069
+456,426
+838
+507,083
+(457)
+(225,490)
+40,507
+27,506
+4,491,673
+(1) Other operating income includes insurance premium income earned, and operating expenses include insurance benefits and claims.
+(2) Non-current assets include property and equipment, investment properties, right-of-use assets, intangible assets and other long-term assets.
+BANK OF CHINA LIMITED
+1,593
+12,133
+Capital expenditure
+(1,432)
+2,090,165
+9,939
+2,017,915
+(1,448,454)
+33,508
+24,402,659
+(2,980)
+(1,448,315)
+324,480
+22,239,822
+Other segment items:
+Inter-segment net interest (expense)/income
+(4,886)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+775
+7,546
+(2,660)
+Inter-segment net fee and commission income/(expense)
+487
+395
+692
+1,087
+(142)
+6,771
+24,369,151
+FOR THE YEAR ENDED 31 DECEMBER 2021
+V
+Interest expense
+(176,401)
+(137,540)
+(109,822)
+(139)
+(84)
+(6,549)
+66,189
+(364,346)
+Net interest income/(expense)
+169,813
+173,940
+78,610
+1,081
+3,830
+(2,135)
+3
+789,488
+(66,186)
+4,414
+3,914
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+43 Segment reporting (Continued)
+As at and for the year ended 31 December 2021
+Corporate
+banking
+Personal
+banking
+Treasury
+operations
+Investment
+(Amount in millions of Renminbi, unless otherwise stated)
+banking
+Other
+Elimination
+Total
+Interest income
+346,214
+311,480
+188,432
+1,220
+Insurance
+(1,448,454)
+2,090,165
+4,292,883
+13,796
+4,306,679
+198,520
+3,917,100
+436,634
+66,984
+44,383
+111,367
+22,002
+(2,356)
+567,647
+Operating expenses
+(1)
+(140,087)
+(33,468)
+(23,011)
+(56,479)
+(8,201)
+2,356
+(202,411)
+Impairment losses on assets
+Operating income
+58,605
+(924)
+948
+(4,208)
+5,793
+5,293
+11,086
+1,177
+8,055
+Net gains on transfers of financial asset
+4,965
+(107,622)
+4,063
+4,205
+377
+9,547
+Other operating income (1)
+14,727
+16,999
+26,855
+43,854
+142
+(2,407)
+(2,574)
+(4,981)
+Profit for the year
+205,096
+Segment assets
+19,434,557
+Investments in associates and joint ventures
+19,712
+2,762,985
+858
+Total assets
+(41,282)
+19,454,269
+1,529,898
+12,938
+1,542,836
+Include: non-current assets (2)
+119,001
+27,626
+Segment liabilities
+17,753,122
+2,520,219
+170,894
+1,396,881
+2,763,843
+425,142
+Income tax expense
+7,388
+(6,413)
+(119,016)
+Operating profit
+188,925
+31,109
+18,798
+49,907
+7,388
+246,378
+246,220
+(185)
+(164)
+507
+Profit before income tax
+188,740
+30,945
+343
+50,250
+158
+Share of results of associates and joint ventures
+Net trading (losses)/gains
+Fee and commission income
+39,163
+92,943
+231,683
+Investments in associates and joint ventures
+5,779
+637,470
+30,130
+(94,154)
+(140)
+26,686,639
+Total assets
+10,117,500
+6,179,877
+9,521,320
+98,722
+231,683
+667,600
+(94,294)
+35,769
+26,722,408
+Segment liabilities
+9,521,320
+6,179,877
+10,117,500
+Segment assets
+Share of results of associates and joint ventures
+339
+1,273
+(134)
+1,478
+Profit before income tax
+64,493
+102,996
+12,303,472
+78,812
+1,634
+22,656
+(157)
+276,620
+Income tax expense
+(49,281)
+Profit for the year
+227,339
+6,186
+275,142
+8,427,530
+62,915
+3,998
+4,615
+212
+212
+158
+20,967
+Depreciation and amortisation
+9,225
+11,027
+2,698
+411
+280
+6,082
+(931)
+30,162
+28,792
+Credit commitments
+3,956,835
+Capital expenditure
+(433)
+360
+(1,612)
+211,832
+328,198
+(94,037)
+24,371,855
+Other segment items:
+Inter-segment net interest income/(expense)
+16,438
+48,690
+3,131,945
+(64,964)
+9
+(436)
+3
+Inter-segment net fee and commission income/(expense)
+472
+1,791
+59
+(637)
+260
+(23)
+21,383
+1,634
+81,426
+Net trading gains/(losses)
+1,972
+(347)
+13,255
+500
+(41)
+12,874
+78
+28,291
+359
+59
+Net gains on transfers of financial asset
+1,458
+206
+1,262
+21
+(433)
+1,944
+(3,585)
+7,179
+15,240
+9,819
+2,087
+(3,068)
+94,453
+Fee and commission expense
+(1,382)
+(6,998)
+237
+(914)
+(3,585)
+(143)
+2,635
+(13,027)
+Net fee and commission income/(expense)
+29,830
+32,165
+14,326
+(2,640)
+13
+3,197
+Other operating income
+(34,357)
+(11,229)
+3,749
+(226,355)
+Impairment losses on assets
+(68,087)
+(24,778)
+(7,341)
+(2,984)
+(270)
+(3,513)
+Segment assets
+(104,220)
+Operating profit
+64,493
+102,996
+78,812
+5,847
+(30)
+31,212
+(21,784)
+(71,074)
+581
+10,486
+484
+320
+35,580
+23,429
+(3,219)
+67,661
+(88,676)
+Operating income
+216,450
+107,937
+9,101
+36,021
+36,125
+(3,571)
+605,717
+Operating expenses
+203,654
+75,522
+(201)
+5,221,154
+4,376
+601
+15,070
+4,917
+971
+(1,250)
+150
+(1,353)
+Depreciation and amortisation
+20,355
+1,833
+6,406
+Credit commitments
+4,433,323
+293,314
+1,423
+171,201
+269
+880
+535,677
+(682)
+(212,361)
+30,162
+28,792
+5,221,154
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+16,493
+8,239
+464,515
+43 Segment reporting (Continued)
+13,400
+370
+2,951,526
+598
+21,491,846
+Include: non-current assets (2)
+117,571
+Segment liabilities
+19,607,634
+2,952,124
+26,383
+2,709,070
+1,659,173
+14,627
+1,673,800
+4,610,699
+2,292,838
+(1,688,200)
+26,686,639
+Capital expenditure
+169,999
+1,521,145
+2,292,838
+(1,688,200)
+35,769
+26,722,408
+9,021
+2,222,113
+(4,275)
+(1,688,107)
+318,699
+24,371,855
+Other segment items:
+Inter-segment net interest (expense)/income
+(3,667)
+541
+Inter-segment net fee and commission income
+232
+15,225
+4,625,924
+196,382
+4,230,215
+20,544
+358
+Hong Kong (China), Macao (China) and Taiwan (China)
+6,373
+37,560
+15,365
+415,918
+67,187
+11,355
+7,846
+19,201
+6,085
+(3,833)
+88,640
+Fee and commission expense
+31,187
+(9,030)
+(2,126)
+(4,539)
+(1,950)
+2,401
+(13,118)
+Net fee and commission income
+58,157
+8,942
+5,720
+14,662
+4,135
+(1,432)
+(2,413)
+As at and for the year ended 31 December 2020
+362,993
+19,483
+Chinese
+BOCHK
+Other countries
+mainland
+Group
+Other
+Subtotal
+and regions
+Elimination
+Total
+Interest income
+Interest expense
+(344,152)
+Net interest income
+673,082
+44,499
+29,847
+74,346
+32,125
+(19,483)
+760,070
+(310,089)
+(13,312)
+(23,474)
+(36,786)
+(16,760)
+Fee and commission income
+Investments in associates and joint ventures
+Total assets
+3,220
+associated
+transferred
+associated
+transferred
+Carrying
+amount of
+Carrying
+amount of
+As at 31 December 2020
+assets
+As at 31 December 2021
+Carrying Carrying
+amount of amount of
+Transferred financial assets that do not qualify for derecognition mainly include
+debt securities held by counterparties as collateral under repurchase agreements. The
+counterparties are allowed to sell or re-pledge those securities in the absence of default by
+the Group, but have an obligation to return the securities upon maturity of the contract.
+If the value of securities increases or decreases, the Group may in certain circumstances,
+require counterparties or be required by counterparties to pay additional cash collateral.
+The Group has determined that the Group retains substantially all the risks and rewards of
+these securities and therefore has not derecognised them. In addition, the Group recognises a
+financial liability for cash received.
+Repurchase agreements
+The Group enters into transactions in the normal course of business by which it transfers
+recognised financial assets to third parties or to special purpose entities. In some cases
+where these transferred financial assets qualify for derecognition, the transfers may give rise
+to full or partial derecognition of the financial assets concerned. In other cases where the
+transferred assets do not qualify for derecognition as the Group has retained substantially all
+the risks and rewards of these assets, the Group continues to recognise the transferred assets.
+44 Transfers of financial assets
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+The following table analyses the carrying amount of the above-mentioned financial assets
+transferred to third parties that did not qualify for derecognition and their associated
+financial liabilities:
+liabilities
+assets
+liabilities
+For those in which the Group has neither transferred nor retained substantially all the risks
+and rewards of the transferred credit assets, and retained control of the credit assets, the
+transferred credit assets are recognised in the statement of financial position to the extent
+of the Group's continuing involvement. The carrying amount at the time of transfer of
+the original credit assets, which the Group determined that it has continuing involvement
+through acquiring some tranches, was RMB46,442 million for this year (2020: RMB 15,365
+million) and the carrying amount of assets that the Group continues to recognise in the
+statement of financial position was RMB21,579 million as at 31 December 2021 (31
+December 2020: RMB15,244 million).
+With respect to the credit assets that were securitised and qualified for derecognition,
+the Group derecognises the transferred credit assets in their entirety. The corresponding
+total carrying amount of asset-backed securities held by the Group in the securitisation
+transactions was RMB680 million as at 31 December 2021 (31 December 2020: RMB760
+million), which also approximates the Group's maximum exposure to loss.
+The Group enters into credit asset transfers in the normal course of business during which it
+transfers credit assets to special purpose entities which in turn issue asset-backed securities
+or fund shares to investors. The Group may acquire some asset-backed securities and fund
+shares at the subordinated tranche level, and accordingly, may retain parts of the risks and
+rewards of the transferred credit assets. The Group would determine whether or not to
+derecognise the associated credit assets by evaluating the extent to which it retains the risks
+and rewards of the assets.
+Credit assets transfers
+44 Transfers of financial assets (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+361
+13,550
+13,248
+6,398
+6,655
+Repurchase agreements
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+4,491,673
+The Group's consolidated structured entities mainly consist of open-end funds, private
+equity funds, trusts for asset-backed securities, and special-purpose companies. The Group
+controls these entities because the Group has power over, is exposed to, or has rights to
+variable returns from its involvement with these entities and has the ability to use its power
+over these entities to affect the amount of the Group's returns. Except for providing financial
+guarantees for the companies established solely for financing purposes, the Group does not
+provide financial or other support to the other consolidated structured entities.
+365
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+46 Offsetting financial assets and financial liabilities
+Financial assets subject to offsetting, enforceable master netting arrangements and similar
+agreements are analysed as below:
+Gross
+amounts
+presented
+Amounts Amounts not set off in the
+consolidated statement
+Gross offset in the
+in the
+of financial position
+recognised statement
+45.2 Consolidated structured entities
+362
+104,366
+58,195
+1,249,398
+3,242,275
+40,507
+27,506
+(714)
+5,712
+277
+404
+2,532
+10,630
+8,665
+32,263
+116
+179
+11,321
+Asset-backed securitisations
+5,538
+40,633
+104,366
+2,745
+BANK OF CHINA LIMITED
+FOR THE YEAR ENDED 31 DECEMBER 2021
+amounts of consolidated consolidated
+68,914
+Fund investments
+As at 31 December 2021
+Structured entity type
+loss
+Total
+68,914
+cost
+or loss
+exposure to
+amortised
+profit comprehensive
+Maximum
+assets at
+other
+income
+68,914
+Investment trusts and asset management plans
+11,321
+6,303
+12,268
+12,268
+Asset-backed securitisations
+11,357
+45,880
+67,844
+125,081
+125,081
+As at 31 December 2020
+Fund investments
+57,099
+57,099
+57,099
+Investment trusts and asset management plans
+2,914
+8,407
+through
+Financial
+through
+fair value
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+363
+As at 31 December 2021, the balance of interest and commission receivable held by the
+Group in the above-mentioned structured entities is not material. For the purpose of asset-
+liability management, wealth management products may require short-term financing from
+the Group and other banks. The Group is not contractually obliged to provide financing.
+After internal risk assessment, the Group may enter into repurchase and placement
+transactions with these wealth management products in accordance with market principles.
+For the year ended 31 December 2021, the maximum balance of such financing provided
+by the Group to the unconsolidated wealth management products was RMB62,120 million
+(2020: RMB132,205 million). Such financing provided by the Group was included in
+"Placements with and loans to banks and other financial institutions". As at 31 December
+2021, the balance of the above transactions was RMB2,600 million (31 December 2020:
+RMB18,580 million). The maximum exposure to loss of those placements approximated to
+their carrying amount.
+For the year ended 31 December 2021, the above-mentioned management fees, commission
+and custodian fees amounted to RMB11,435 million (2020: RMB8,499 million).
+As at 31 December 2021, the balance of unconsolidated wealth management products
+sponsored by the Group amounted to RMB1,710,750 million (31 December 2020:
+RMB1,388,904 million). The balance of unconsolidated publicly offered funds and
+asset management plans sponsored by the Group amounted to RMB487,438 million (31
+December 2020: RMB486,880 million).
+In conducting the asset management business in Chinese mainland, the Group established
+various structured entities to provide customers specialised investment opportunities within
+well-defined objectives, including wealth management products, publicly offered funds and
+asset management plans. The Group earned management fee, commission and custodian fee
+in return.
+The interests held by the Group in unconsolidated structured entities are mainly as follows:
+Structured entities sponsored by the Group
+45.1 Interests in unconsolidated structured entities
+The Group is principally involved with structured entities through financial investments,
+asset management and credit assets transfers. These structured entities generally finance the
+purchase of assets by issuing securities or by other means. The Group determines whether or
+not to consolidate these structured entities depending on whether the Group has control over
+them.
+45 Interests in structured entities
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+45 Interests in structured entities (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+45.1 Interests in unconsolidated structured entities (Continued)
+In July 2020, the regulatory authorities made a decision on extending the transition
+period for the Guiding Opinions on Regulating Asset Management Business of Financial
+Institutions to the end of 2021 and encouraged orderly disposal of legacy investments in
+a variety of ways. As at 31 December 2021, the Group had completed the rectification of
+wealth management products as scheduled.
+fair value
+assets at
+assets at
+Financial
+Financial
+The interests held by the Group in the structured entities sponsored by other financial
+institutions through direct investments are set out as below:
+Structured entities sponsored by other financial institutions
+45.1 Interests in unconsolidated structured entities (Continued)
+45 Interests in structured entities (Continued)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+364
+In addition, the total carrying amount as at the transfer date of credit assets transferred by
+the Group into the unconsolidated structured entities was RMB3,476 million for the year
+ended 31 December 2021 (2020: RMB1,230 million). For the description of the portion of
+asset-backed securities issued by the above structured entities and held by the Group, refer
+to Note V.44.
+Structured entities sponsored by the Group (Continued)
+financial of financial of financial
+statement
+Cash
+Investments in associates and joint ventures
+8,379
+7,731
+Consolidated structured entities
+202,265
+202,275
+Property and equipment
+79,534
+81,661
+Investment properties
+1,984
+2,185
+Deferred income tax assets
+51,892
+59,767
+Other assets
+102,586
+LIABILITIES
+47.1 The Bank's statement of financial position (Continued)
+The Bank's statement of financial position and changes in equity (Continued)
+47
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+135,553
+FOR THE YEAR ENDED 31 DECEMBER 2021
+BANK OF CHINA LIMITED
+21,363,483
+23,546,823
+368
+Total assets
+112,152
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+140,451
+Investments in subsidiaries
+2,841,376
+9,083
+214,310
+267,913
+Precious metals
+9,080
+bank notes issued
+Government certificates of indebtedness for
+Derivative financial assets
+1,065,541
+other financial institutions
+Placements with and loans to banks and
+1,895,772
+2,066,094
+Balances with central banks
+735,856
+1,441,375
+As at 31 December
+70,379
+Loans and advances to customers, net
+2,993,581
+- financial assets at amortised cost
+1,315,891
+1,486,942
+comprehensive income
+financial assets at fair value through other
+132,878
+264,746
+financial assets at fair value through profit or loss
+4,422,013
+4,768,450
+Financial investments
+12,286,706
+13,652,081
+287,927
+2021
+2020
+Due to banks and other financial institutions
+208,319
+Statutory reserves
+17,712
+20,116
+Other comprehensive income
+132,590
+188,832
+132,331
+277,490
+319,505
+Other equity instruments
+294,388
+294,388
+Share capital
+Capital reserve
+EQUITY
+General and regulatory reserves
+261,170
+LIU Jin
+369
+Director
+LIU Liange
+Approved and authorised for issue by the Board of Directors on 29 March 2022.
+21,363,483
+292,549
+23,546,823
+1,838,794
+2,008,271
+Total equity
+666,612
+741,063
+Undistributed profits
+Total equity and liabilities
+684,360
+19,524,689
+Total liabilities
+571
+1,945
+Financial liabilities held for trading
+393,521
+356,765
+Placements from banks and other financial institutions
+Derivative financial liabilities
+9,226
+Bank notes in circulation
+838,054
+883,097
+Due to central banks
+1,960,349
+2,751,227
+8,970
+21,538,552
+65,892
+Due to customers
+567
+176,000
+187,732
+Other liabilities
+596
+Deferred income tax liabilities
+50,980
+2,199
+164,604
+40,325
+2,095
+Current tax liabilities
+1,140,777
+1,283,648
+Bonds issued
+14,787,841
+15,956,260
+Retirement benefit obligations
+2020
+As at 31 December
+2021
+other financial institutions
+366
+16,984
+(2,843)
+(41,064)
+60,891
+(12,035)
+BANK OF CHINA LIMITED
+72,926
+4,576
+4,576
+(12,035)
+16,611
+Other assets
+(3,858)
+Total
+3,858
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(Amount in millions of Renminbi, unless otherwise stated)
+financial of financial
+Cash
+statement
+recognised statement
+amounts of consolidated consolidated
+of financial position
+FOR THE YEAR ENDED 31 DECEMBER 2021
+consolidated statement
+Amounts
+presented
+in the
+Gross offset in the
+Gross
+amounts
+Financial liabilities subject to offsetting, enforceable master netting arrangements and
+similar agreements are analysed as below:
+46 Offsetting financial assets and financial liabilities (Continued)
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Amounts not set off in the
+of financial
+3,858
+12,408
+16,568
+Reverse repo agreements
+5,719
+(20,332) (3,262)
+29,313
+29,313
+16,568
+Derivatives
+amount
+Net
+collateral
+received
+Financial
+position instruments*
+position
+assets
+As at 31 December 2021
+Reverse repo agreements
+(16,568)
+9,357
+52,457 (37,206) (2,843)
+52,457
+Derivatives
+As at 31 December 2020
+7,792
+(3,262)
+Other assets
+(36,900)
+(7,284)
+55,238
+Total
+2,073
+2,073
+(7,284)
+47,954
+192
+Financial
+Net
+(14,196)
+(37,396)
+63,559
+(12,035)
+75,594
+Total
+11,967
+971
+(12,035)
+13,006
+Other liabilities
+(176)
+176
+176
+971
+Repurchase agreements
+* Including non-cash collateral.
+Derivatives and reverse repo/repurchase agreements included in the amounts are not set off
+in the consolidated statement of financial position where:
+Cash and due from banks and
+ASSETS
+47.1 The Bank's statement of financial position
+The Bank's statement of financial position and changes in equity
+47
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+Financial assets and financial liabilities are offset and the net amount is reported in the
+statement of financial position when there is a legally enforceable right to offset the
+recognised amounts and there is an intention to settle on a net basis, or realise the asset and
+settle the liability simultaneously ("the offset criteria”).
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+367
+cash and non-cash collateral have been received/pledged in respect of the transactions
+described above.
+the counterparty has an offsetting exposure with the Group and a master netting or
+similar arrangement (including ISDA master agreement and Global Master Netting
+Agreement) is in place with a right of setting off only in the event of default,
+insolvency or bankruptcy, or the offset criteria are otherwise not satisfied; and
+•
+FOR THE YEAR ENDED 31 DECEMBER 2021
+collateral
+10,996
+(37,220)
+55,816
+Repurchase agreements
+4,618
+(4,701)
+(20,526)
+29,845
+55,816
+29,845
+As at 31 December 2021
+amount
+pledged
+position instruments*
+position
+liabilities
+Derivatives
+(14,196)
+(55,816)
+7,799
+62,412
+62,412
+Derivatives
+As at 31 December 2020
+5,133
+(4,701)
+Other liabilities
+(76,342)
+(7,284)
+93,460
+Total
+515
+515
+(7,284)
+86,176
+4,137
+113,601
+Credit commitments
+(3,513)
+4,071
+13,304
+30,982
+29,020
+Net fee and commission income/(expense)
+(13,118)
+2,501
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+V
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+43 Segment reporting (Continued)
+As at and for the year ended 31 December 2020
+360
+Corporate
+Personal
+banking
+banking
+2,209
+(551)
+75,522
+Net trading gains/(losses)
+20,402
+31,962
+287
+1,039
+7,284
+831
+Other operating income
+9,547
+6
+243
+Treasury
+operations
+1
+102
+1,215
+Net gains on transfers of financial asset
+8,055
+(46)
+3,571
+2,793
+(1,954)
+1,097
+2,326
+7,980
+(3,200)
+Investment
+Insurance
+(3,063)
+192
+415,918
+Fee and commission income
+30,304
+37,241
+15,935
+5,871
+1
+2,340
+(3,052)
+88,640
+Fee and commission expense
+(1,284)
+(6,259)
+(2,631)
+(1,800)
+(3,514)
+(131)
+3,620
+Director
+3,420
+1,485
+47,517
+182,169
+Other
+Elimination
+Total
+Interest income
+340,794
+294,134
+190,422
+1,888
+3,525
+4,053
+banking
+(74,746)
+(156,596)
+(111,965)
+(142,905)
+(403)
+(105)
+(7,116)
+74,938
+760,070
+(344,152)
+Net interest income/(expense)
+184,198
+Interest expense
+58,605
+268
+217,590
+621,443
+204,290
+105,010
+8,684,296
+5,641,051
+9,251,427
+Total assets
+593,454
+27,989
+204,290
+99,425
+5,585
+Investments in associates and joint ventures
+8,684,296
+5,641,051
+9,251,427
+Segment assets
+205,096
+Profit for the year
+(41,282)
+Income tax expense
+Operating income
+63
+11,060
+1,586
+3,446
+42,218
+74,404
+Profit before income tax
+(104,792)
+(66)
+(104,858)
+24,369,151
+33,508
+24,402,659
+Depreciation and amortisation
+Capital expenditure
+(550)
+417
+(1,769)
+(598)
+114
+1,759
+627
+Inter-segment net fee and commission income/(expense)
+192
+(914)
+14
+158
+310
+52,337
+20,712
+Inter-segment net interest income/(expense)
+Other segment items:
+22,239,822
+(104,699)
+332,963
+185,310
+72,597
+3,915,554
+7,461,553
+10,376,544
+Segment liabilities
+(72,651)
+(65)
+246,378
+342
+3,104
+42,218
+113,601
+74,404
+Operating profit
+(119,016)
+65
+(1,789)
+(49)
+(12)
+(119)
+1,586
+(8,223)
+(79,872)
+Impairment losses on assets
+(202,411)
+3,668
+(10,157)
+(33,270)
+(2,996)
+(17,445)
+(78,897)
+(63,314)
+Operating expenses
+(29,136)
+11,179
+128
+246,220
+221,634
+567,647
+67,886
+(3,605)
+Share of results of associates and joint ventures
+34,905
+23,125
+6,112
+The Group measures and manages the credit quality of loans and advances to corporate
+and personal customers based on the Guideline for Loan Credit Risk Classification (the
+“Guideline") issued by the former China Banking Regulatory Commission, which requires
+commercial banks to classify their corporate and personal loans into five categories: pass,
+special-mention, substandard, doubtful and loss, among which loans classified in the
+substandard, doubtful and loss categories are regarded as non-performing loans. Off-balance
+sheet commitments with credit exposure are also assessed and categorised with reference
+to the Guideline. For operations in Hong Kong (China), Macao (China), Taiwan (China)
+and other countries and regions, where local regulations and requirements are different
+from the Guideline, credit assets are classified with prudently not lower than the Group's
+management requirements in consideration of local regulations and requirements.
+In accordance with the New Basel Capital Accord, the Group implemented a domestic
+corporate customer credit rating system based on the probability default ("PD”) model.
+The domestic corporate customer PD model uses the principle of logistic regression to
+predict the PD for customers in the next 12 months. The risk rating of the customer is
+obtained through the relevant mapping relationship table according to the calculated PD
+value. The corporate customer credit ratings are classified into fifteen grades as AAA,
+AA, A, BBB+, BBB, BBB-, BB+, BB, BB-, B+, B-, CCC, CC, C, and D. Credit grade D
+equates to defaulted customers while the others are assigned to non-defaulted customers.
+The Group performs centralised review on customer credit ratings on an annual basis in
+addition to making adjustments as necessary according to the customers' operational and
+financial condition. The Group conducts back-testing of the rating model for domestic
+corporate customers, according to the customers' actual defaults each year, so that the model
+calculation results are closer to the objective facts.
+The Group strictly follows the regulatory requirements in five-category loan classifications
+management, and makes adjustments to these classifications as necessary according to
+customers' operational and financial position, together with other factors that may affect the
+repayment of the loans.
+Loss: principal and interest of loans cannot be recovered or only a small portion can be
+recovered after taking all possible measures and resorting to necessary legal procedures.
+Doubtful: loans for which borrowers cannot pay back the principal and interest of loans in
+full and significant losses will be incurred by the Group even when guarantees are executed.
+Substandard: loans for which borrowers' ability to service loans is apparently in question
+and borrowers cannot depend on their normal business revenues to pay back the principal
+and interest of loans. Certain losses might be incurred by the Group even when guarantees
+are executed.
+Special-mention: loans for which borrowers are still able to service the loans currently,
+although the repayment of loans might be adversely affected by some factors.
+Pass: loans for which borrowers can honour the terms of the contracts, and there is no reason
+to doubt their ability to repay the principal and interest of loans in full and on a timely basis.
+(1) Loans and advances to customers and off-balance sheet commitments (Continued)
+2.1 Credit risk management (Continued)
+Credit risk (Continued)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+375
+The five categories are defined as follows:
+2
+376
+FOR THE YEAR ENDED 31 DECEMBER 2021
+The Group identifies and monitors credit risk collectively based on industry, geography and
+customer type. Management periodically reviews various elements of the Group's credit risk
+management, in the context of loan portfolio growth, the changing mix and concentration of
+assets, and the evolving risk profile of the credit portfolio. From time to time, in this regard,
+refinements are made to the Group's credit risk management processes to most effectively
+manage the effects of these changes on the Group's credit risk. These refinements include,
+among other things, adjustments to portfolio level controls, such as revisions to lists of
+approved borrowers, industry limits and underwriting criteria. Where circumstances related
+to specific loans or a group of loans increase the Bank's credit risk, actions are taken, to the
+extent possible, to strengthen the security of the Group's position. The actions may include
+obtaining additional guarantors or collateral.
+(1) Loans and advances to customers and off-balance sheet commitments
+BANK OF CHINA LIMITED
+2.1 Credit risk management
+Credit risk exposures arise principally in lending activities and debt securities investment
+activities. There is also credit risk in off-balance sheet financial instruments, such as loan
+commitments, bill acceptance, letters of guarantee and letters of credit.
+The Group takes on exposure to credit risk, which is the risk that a borrower or counterparty
+will cause a financial loss to the Group by failing to discharge its obligation. Credit risk is
+one of the most significant risks for the Group's business.
+Credit risk
+2
+VI FINANCIAL RISK MANAGEMENT (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+BANK OF CHINA LIMITED
+374
+Branches and sub-branches are responsible for the comprehensive risk management of
+business departments at the same level and institutions at lower levels, and shall report their
+risk position to the Risk Management Department of the Head Office. The subsidiaries shall
+establish and improve their respective comprehensive risk management systems and carry
+out comprehensive risk management-related work in accordance with relevant regulatory
+guidelines and the requirements of this Policy.
+The Board of Directors of the Group assumes the ultimate responsibility for comprehensive
+risk management. The Board of Directors authorises its subordinate Risk Policy Committee,
+Audit Committee and US Risk and Management Committee to perform part of the
+responsibilities of comprehensive risk management. The Board of Supervisors undertakes
+the supervision responsibility for comprehensive risk management, and is responsible
+for supervising and inspecting the duty performance of the Board of Directors and senior
+management in respect of risk management and supervising relevant rectification. The
+senior management is responsible for conducting comprehensive risk management and
+implementing resolutions of the Board of Directors. The Risk Management Department,
+Credit Approval Department, Credit Management Department, Internal Control and Legal
+& Compliance Department and other relevant functional departments are responsible for
+managing financial risks.
+The financial risks the Group is exposed to mainly include credit risk, market risk and
+liquidity risk. Among them, market risk includes exchange rate risk, interest rate risk and
+other price risks.
+The Group analyses, identifies, monitors and reports risks by formulating risk management
+policies, setting appropriate risk limits and control procedures, and using relevant
+information systems. It also regularly reviews its risk management policies and related
+systems to reflect new changes in markets, products and the industry's best practices.
+Overview
+1
+VI FINANCIAL RISK MANAGEMENT
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+Mortgages to retail customers are generally collateralised by mortgages over residential
+properties. Whether or not other loans require collateral is dependent on the nature of the
+loan and the Group's credit management requirements.
+The Group has a range of policies and practices intended to mitigate credit risk. The most
+prevalent of these is the taking of security for funds advances, collateral and guarantees.
+The Group implements guidelines on the acceptability of specific classes of collateral
+and coverage rate upper limits. The amount of acceptable collateral at the time of loan
+origination is determined by the Credit Management Department and is subject to coverage
+rate upper limits based on type. Value of collateral is monitored on an ongoing basis.
+(i) Collateral and guarantees
+(2) Credit risk mitigation policies
+The Group is also exposed to credit risk through investment activities and trading activities.
+Credit limits are established based on type of instruments and the credit quality of
+counterparties, securities issuers and the securities, and set limits are actively monitored.
+(ii) Debt securities and derivatives
+(1) Credit risk limits and controls (Continued)
+2.2 Credit risk limit control and mitigation policies (Continued)
+2 Credit risk (Continued)
+For loans guaranteed by a third party guarantor, the Group will assess the guarantor's credit
+rating, financial condition, credit history and ability to meet its obligations.
+VI FINANCIAL RISK MANAGEMENT (Continued)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+378
+Exposure to credit risk is also managed through regular analysis of the ability of borrowers
+and potential borrowers to meet interest and capital repayment obligations and by changing
+aforementioned credit limit where appropriate.
+The Head Office also oversees the risk management of the branches in Hong Kong (China),
+Macao (China), Taiwan (China) and other countries and regions. In particular, any credit
+application at these branches exceeding the authorisation limits is required to be submitted
+to the Head Office for approval.
+Personal loans in the Chinese mainland must be approved by authorised approvers at tier 1
+branch level in the Chinese mainland, except for individual pledged loans and government-
+sponsored student loans, which may be approved by authorised approvers at sub-branches
+below tier 1 level.
+Credit applications for corporate customers in the Chinese mainland must be approved by
+the authorised credit application approvers at the Head Office and tier 1 branch level in the
+Chinese mainland, except for certain Credit Factory customers applications and low risk
+loans and advances approved by the authorised credit application approvers at tier 2 branch
+level. The exposure to any one borrower, including banks, is restricted by approved total
+credit limits covering on and off-balance sheet exposures.
+In order to manage the exposure to credit risk, the Group has adopted credit policies and
+procedures that are reviewed and updated by the Credit Management Department and the
+Credit Approval Department at the Head Office. The credit approval processes for both
+corporate loans and personal loans can be broadly divided into three stages: (1) credit
+origination and assessment; (2) credit review and approval; and (3) fund disbursement and
+post-disbursement management.
+373
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Collateral held as security for financial assets other than loans and advances is determined
+by the nature of the instrument. Debt securities, treasury and other eligible bills are generally
+unsecured, with the exception of certain asset-backed securities and similar instruments,
+which are secured by portfolios of financial instruments.
+379
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.1 Credit risk management (Continued)
+(2) Due from, placements with and loans to banks and other financial institutions
+The Group manages the credit quality of due from, placements with and loans to banks
+and other financial institutions considering the size, financial position and the internal and
+external credit rating of banks and financial institutions. During the business lifetime, the
+Group conducts comprehensive analysis, monitors and manages internal and external factors
+that may affect customers' ability to operate on on-going basis and capacity to bear risk, and
+takes corresponding control measures.
+(3) Debt securities and derivatives
+Credit risk within debt securities arises from exposure to movements in credit spreads,
+default rates and loss given default, as well as changes in the credit of underlying assets.
+The Group manages the credit risk within debt securities by monitoring the external credit rating,
+such as Standard & Poor's ratings or their equivalents, of the securities, the internal credit rating
+of the issuers of debt securities, and the credit quality of underlying assets of securitisation
+products (including review of default rates, prepayment rates), industry and sector performance,
+loss coverage ratios and counterparty risk, to identify exposure to credit risk.
+Collateral is also held as part of reverse repurchase agreements. Under such agreements, the
+Group is permitted to sell or repledge collateral in the absence of default by the owner of
+the collateral. Details of collateral accepted and which the Group is obligated to return are
+disclosed in Note V.40.3.
+The Group has established policies to manage the net open derivative positions by amounts
+and by maturity dates. At any time, the current credit exposure equals to the fair value of
+those derivatives where the fair value changes are favorable to the Group (i.e. positive
+mark-to-market amounts). Credit risk exposures for derivatives are included as part of the
+aggregated credit risk limit management for financial institutions and customers. Collaterals
+or other pledges of assets are not typically sought for these exposures.
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.2 Credit risk limit control and mitigation policies
+The Group manages limits and controls concentrations of credit risk in particular, to
+individual customers and to industries.
+(1) Credit risk limits and controls
+377
+The Bank issued tier 2 capital bonds in an amount of RMB30 billion on 20 January 2022.
+The bonds have a maturity of date of 24 January 2032 with a fixed coupon rate of 3.25%,
+payable annually. The Bank is entitled to redeem the bonds at the end of the fifth year.
+132,627
+Events after the financial reporting date
+294,388
+As at 31 December 2021
+41,984
+(228)
+(31)
+(228)
+42,015
+Other
+reduction by other equity
+instruments holders
+(68,645)
+(68,645)
+(31,379)
+31,379
+(19,487)
+19,487
+196,366
+193,962
+319,505
+132,331
+20,116
+208,319
+Share
+capital
+General and
+Other
+371
+47.2 The Bank's statement of changes in equity (Continued)
+The Bank's statement of financial position and changes in equity (Continued)
+47
+2,404
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+2,008,271
+741,063
+292,549
+V
+1,838,794
+666,612
+261,170
+Dividends
+regulatory reserves
+Appropriation to general and
+Appropriation to statutory reserves
+Total comprehensive income
+As at 1 January 2021
+47.2 The Bank's statement of changes in equity
+Capital contribution and
+370
+47
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+V
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(i)
+The Bank's statement of financial position and changes in equity (Continued)
+Other equity
+instruments
+Other
+Share
+capital
+188,832
+17,712
+132,590
+277,490
+294,388
+Total
+profits
+General and
+reserves
+income
+reserve
+Undistributed
+regulatory
+Statutory
+Capital comprehensive
+Other equity
+instruments
+reserves
+Issuance of Tier 2 Capital Bonds
+Capital comprehensive
+regulatory Undistributed
+The Group monitors the risks related to IBOR reform, continuously monitors the risk
+exposure and converts existing contracts.
+IBOR Reform
+48
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+1,838,794
+666,612
+261,170
+188,832
+17,712
+132,590
+277,490
+(1) The Group exposed to different interbank offered rates (“IBORS”), predominantly US
+dollar Libor. The following table contains details of financial instruments that Group's
+commercial banking business holds at 31 December 2021 which reference USD
+LIBOR and have not yet transitioned to an alternative interest rate benchmark:
+As at 31 December 2021
+Non-derivative assets
+Non-derivative liabilities
+49
+V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+372
+294,388
+As at 31 December 2021, the notional amount of interest rate derivatives designated in
+fair value hedged accounting relationships was RMB65,260 million (2020: RMB93,964
+million), which represented the extent of the risk exposure around fair value hedging
+relationships managed by the Group that was directly affected by IBOR reform and
+impacted by applicable temporary reliefs.
+(2) The Group has hedge accounting relationships that are exposed to different interbank
+offered rates (“IBORs”), predominantly US dollar Libor, etc. External progress on
+the transition to RFRs is being monitored, with the objective of ensuring a smooth
+transition for the Group's hedge accounting relationships. The specific issues arising
+will vary with the details of each hedging relationship, but may arise due to the
+transition of existing products included in the designation, a change in expected
+volumes of products to be issued, a change in contractual terms of new products issued,
+or a combination of these factors. Some hedges may need to be de-designated and new
+relationships entered into, while others may survive IBOR reform.
+579,043
+Contractual/Notional amount of derivatives
+2,997
+481,816
+yet to
+transition to
+an alternative
+benchmark
+Financial
+instruments
+The hedge items that are affected by the adoption of applicable temporary reliefs in
+hedge accounting relationships are presented in the statement of financial position as
+"Financial investments”, “Due to central banks” and “Bonds issued".
+As at 31 December 2020
+(10)
+77,560
+(1,590)
+Total comprehensive income
+1,653,881
+596,399
+240,279
+171,003
+19,292
+177,200
+199,893
+As at 1 January 2020
+Total
+profits
+reserves
+reserves
+income
+reserve
+294,388
+Statutory
+175,610
+Appropriation to general and
+10
+transferred to retained earnings
+(37)
+77,597
+(68,257)
+(68,257)
+(20,891)
+Appropriation to statutory reserves
+20,891
+instruments holders
+reduction by other equity
+Capital contribution and
+regulatory reserves
+Dividends
+(17,829)
+17,829
+Other comprehensive income
+Loans and advances and off-balance sheet commitments
+BANK OF CHINA LIMITED
+1,752,527
+969,208
+939,320
+Government certificates of indebtedness for
+bank notes issued
+175,715
+168,608
+Derivative financial assets
+95,799
+171,738
+Loans and advances to customers, net
+15,322,484
+13,848,304
+1,257,413
+Financial investments
+383,313
+- financial assets at fair value through
+other comprehensive income
+2,366,297
+2,086,362
+financial assets at amortised cost
+3,213,199
+2,978,778
+Other assets
+133,453
+134,116
+financial assets at fair value through profit or loss
+Subtotal
+other financial institutions
+724,320
+2,076,840
+The impact of these economic indicators on the PD and the LGD varies according to
+different types of business. The Group applies experts' judgement in this analysis, and
+according to the result, the Group predicts these economic indicators regularly for respective
+regions and determines the impact of these economic indicators on the PD and the LGD by
+conducting regression analysis.
+The specific values of the core macroeconomic indicator used in the baseline scenario to
+evaluate expected credit losses on 31 December 2021 by Chinese Mainland are as follows:
+Indicator
+Quarterly Growth Rate of China's GDP
+Applicable range
+for respective future periods
+5.4%-6.9%
+The Group conducts statistical analysis using experts' judgement to determine multiple
+economic scenarios and their respective weightings. In addition to the baseline scenario,
+optimistic scenario and pessimistic scenario, the Group also considers situation under stress.
+As at 31 December 2021, the baseline scenario has the highest weighting with the remaining
+individual scenarios having a weighting of lower than 30%. The Group measures its credit
+loss allowance based on probability weighted ECL under different scenarios.
+The Group conducts sensitivity analysis on the core economic indicators used in forward-
+looking measurement. As at 31 December 2021, when the predicted value of the core
+economic indicators in the main scenarios increase or decrease by 10%, the respective
+decrease or increase in loan loss allowance will not exceed 5%.
+385
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Placements with and loans to banks and
+FOR THE YEAR ENDED 31 DECEMBER 2021
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.4 Maximum exposure to credit risk before collateral held or other credit enhancements
+As at 31 December
+2021
+2020
+Credit risk exposures relating to on-balance sheet
+financial assets are as follows:
+Due from banks and other financial institutions
+Balances with central banks
+585,298
+2,228,726
+(Amount in millions of Renminbi, unless otherwise stated)
+The Group identifies key macroeconomic indicators that affect the credit risk and ECL of
+various business types, such as country or region local GDP, Investment in fixed assets,
+Producer Price Index, Home price index, Consumer Price Index etc. based on the statistical
+analysis of historical data.
+25,761,697
+Credit risk exposures relating to off-balance
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.5 Loans and advances
+Analysis of loans and advances to customers (accrued interest excluded) by geographical
+area, customer type, industry, collateral type and analysis of impaired and overdue loans and
+advances to customers are presented below:
+(1) Concentrations of risk for loans and advances to customers
+(i) Analysis of loans and advances to customers by geographical area
+Group
+As at 31 December
+2021
+2020
+FOR THE YEAR ENDED 31 DECEMBER 2021
+Amount
+Amount
+% of total
+Chinese mainland
+12,953,259
+82.64%
+11,501,791
+81.09%
+Hong Kong (China), Macao (China)
+and Taiwan (China)
+Other countries and regions
+11.18% 1,697,934
+6.18% 983,660
+% of total
+23,481,450
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+387
+sheet items are as follows:
+Letters of guarantee issued
+1,086,152
+1,035,517
+Loan commitments and other credit commitments
+4,135,002
+3,456,156
+Subtotal
+Total
+386
+5,221,154
+BANK OF CHINA LIMITED
+4,491,673
+27,973,123
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.4 Maximum exposure to credit risk before collateral held or other credit enhancements
+(Continued)
+The table above represents a worst case scenario of credit risk exposure of the Group as
+at 31 December 2021 and 2020, without taking into account any collateral held, master
+netting agreements or other credit enhancements attached. For on-balance sheet assets, the
+exposures set out above are based on net carrying amounts as reported in the statement of
+financial position.
+As at 31 December 2021, 49.45% of the Group's total maximum credit exposure is derived
+from loans and advances to customers (31 December 2020: 49.51%) and 19.13% represents
+investments in debt securities (31 December 2020: 19.32%).
+30,982,851
+The assessment of a significant increase in credit risk and the computation of ECL both
+involve forward-looking information. In assessing the ECL as at 31 December 2021, the
+Group has taken into account the impact of changes in current economic environment to the
+ECL model, including: individual borrower's operating and financial conditions and degree
+of impact from the Covid-19 pandemic, environmental and climate change impact, and
+industry-specific risks impacted by Covid-19 pandemic.
+(5) Forward-looking information
+2.3 Measurement of ECL (Continued)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.3 Measurement of ECL (Continued)
+(1) Segmentation of financial instruments based on credit risk characteristics for losses
+Expected credit loss allowances involve segmentation of exposures on the basis of
+shared risk characteristics, such that risk exposures within a group are homogeneous. In
+performing this segmentation, there must be sufficient information for the segmentation to
+be statistically credible. In particular, the Group uses credit ratings, product types, client
+types, etc., for grouping personal loans and advances to calculate the losses measured on a
+collective basis.
+(2) Criteria for determining significant increases in credit risk
+The Group assesses whether or not the credit risk of the relevant financial instruments has
+increased significantly since the initial recognition at each financial reporting date. While
+determining whether the credit risk has significantly increased since initial recognition
+or not, the Group takes into account the reasonable and supportable information that is
+available without undue cost or effort, including qualitative and quantitative analysis based
+on the historical data, external credit risk rating, and forward-looking information. Based
+on an individual financial instrument or a group of financial instruments shared credit
+risk characteristics, the Group compares the risk of default of financial instruments at the
+financial reporting date with that at the date of initial recognition in order to determine the
+changes of default risk in the expected lifetime of financial instruments.
+The Group considers a financial instrument to have experienced a significant increase in
+credit risk when one or more of the following quantitative, qualitative or backstop criteria
+have been met:
+Quantitative criteria
+At the financial reporting date, the credit risk is deemed to increase significantly when the
+remaining lifetime PD is above a certain level and had risen by more than a certain range
+from initial recognition, reflected as a drop in credit rating by corresponding level according
+to the different PD at initial recognition as well as different products. For instance, an
+exposure of a corporate customer would in most cases be determined to have a significant
+increase in credit risk if its PD as of initial recognition was in excess of 1% and the credit
+rating of such customer has dropped by 4 notches as of the financial reporting date.
+(Amount in millions of Renminbi, unless otherwise stated)
+381
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.3 Measurement of ECL (Continued)
+(2) Criteria for determining significant increases in credit risk (Continued)
+Qualitative criteria (Continued)
+•
+Significant adverse changes in debtor's operations or financial status
+•
+BANK OF CHINA LIMITED
+Migrated into the Special Mention category within the five-category loan classification
+FOR THE YEAR ENDED 31 DECEMBER 2021
+BANK OF CHINA LIMITED
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.2 Credit risk limit control and mitigation policies (Continued)
+(2) Credit risk mitigation policies (Continued)
+(ii) Master netting arrangements
+The Group further restricts its exposure to credit losses by entering into master netting
+arrangements with counterparties. Master netting arrangements do not generally result in
+the offsetting of assets and liabilities in the statement of financial position, as transactions
+are usually settled on a gross basis. However, the credit risk associated with favourable
+contracts is reduced by a master netting arrangement to the extent that if a default or
+other termination event occurs, all amounts with the customer under the master netting
+arrangement are terminated and settled on a net basis. The Group's overall exposure to
+credit risk on derivative instruments subject to master netting arrangements can change
+within a short period, as it is affected by each transaction subject to the arrangement.
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+2.3 Measurement of ECL
+•
+Segmentation of financial instruments based on credit risk characteristics for losses
+.
+Criteria for determining significant increases in credit risk
+•
+Definition of default and credit-impaired financial assets
+•
+Parameters for measuring ECL
+•
+Forward-looking information
+380
+The Group conducts assessments of ECL with reference to forward-looking information
+and uses a number of models and assumptions in its measurement of expected credit
+losses. These models and assumptions relate to the future macroeconomic conditions
+and borrowers' creditworthiness (e.g., the likelihood of default by customers and the
+corresponding losses). The Group uses judgements, assumptions and estimation techniques
+in order to measure ECL according to the requirements of accounting standards which
+include:
+•
+Being included in the watch-list of the Group
+Backstop criteria
+383
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.3 Measurement of ECL (Continued)
+(4) Parameters for measuring ECL
+According to whether the credit risk has significantly increased and whether the asset
+is credit-impaired, the Group measures the impairment allowance for different assets
+with ECL of the next 12 months or throughout the entire lifetime. The key parameters in
+ECL measurement include probability of default ("PD"), loss given default (“LGD") and
+exposure at default (“EAD”). Based on the current New Basel Capital Accord used in risk
+management and the requirements of IFRS 9, the Group takes into account the quantitative
+analysis of historical statistics (such as ratings of counterparties, manners of guarantees and
+types of collateral) and forward-looking information in order to establish the models for
+estimating PD, LGD and EAD in accordance with the requirement of IFRS 9.
+A financial asset becoming credit-impaired may be caused by the combined effect of several
+events, but not a single discrete event.
+Relevant definitions are listed as follows:
+LGD refers to the Group's expectation of the extent of the loss resulting from the defaulted
+exposure. The LGD varies depending on the type of counterparty, the method and priority of
+the recourse, and the type of collateral.
+EAD is based on the amount that the Group expects to be owed at the time of default, over
+the next 12 months or over the remaining lifetime.
+For credit-impaired financial assets with individual amount that are relatively significant,
+the Group mainly evaluates future cash flows (including the recoverable value of the
+collateral held) in different circumstances on an individual basis. Expected credit losses are
+measured as the differences between the present value of estimated cash flows discounted
+at the original effective interest rate (credit adjusted effective interest rate for purchased
+or originated credit-impaired financial assets) and the asset's gross carrying amount. Any
+adjustment is recognised in profit or loss as an impairment loss or reversal. The estimation
+of future cash flows is critical for a credit-impaired loan for which expected credit losses are
+measured on an individual basis. Factors affecting this estimate include, among other things,
+the financial condition of individual borrowers, risk mitigation methods, industry trends and
+the future performance of individual borrowers and cash flows from the sale of collateral.
+384
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+PD refers to the possibility that the debtor will not be able to fulfil its obligations of
+repayment over the next 12 months or over the remaining lifetime;
+The borrower is more than 90 days overdue for any of the principal, advances, interest
+or investments in corporate bonds of the Group
+The purchase or origination of a financial asset at a deep discount that reflects the
+incurred credit losses
+The disappearance of an active market for that financial asset because of financial
+difficulties
+•
+Borrowers' contractual payments (including principal or interest) are more than 30
+days past due.
+The Group has provided credit facilities for temporary deferral of principal repayments
+and interest payments to some of the borrowers affected by the Covid-19 pandemic in
+accordance with the regulatory requirements of respective countries/regions. For those loans
+with deferred principal repayments and interest payments, the Group classified the credit
+risk based on the actual situation of the borrower and the judgement of the substantive risk
+of the business. However, the temporary deferral of principal or interest payment was not
+considered as an automatic trigger of a significant increase of credit risk.
+382
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.3 Measurement of ECL (Continued)
+(3) Definition of default and credit-impaired financial asset
+The Group considers a financial instrument as defaulted when it is credit-impaired. The
+standard adopted by the Group in determining whether a financial asset is credit-impaired
+is consistent with the internal credit risk management objectives, taking into account
+quantitative and qualitative criteria. When the Group assesses whether a credit impairment
+occurred, the following key factors are considered:
+•
+•
+•
+•
+•
+•
+•
+Significant financial difficulty of the issuer or borrower
+A breach of contract, such as a default or delinquency in interest or principal payments
+The Group granting to the borrower, for economic or legal reasons relating to the
+borrower's financial difficulty, a concession that the Group would not otherwise
+consider
+It is becoming probable that the borrower will enter into bankruptcy or other financial
+re-organisation
+11.97%
+6.94%
+353,064
+15,674,994
+Total
+countries
+Other
+(China) and regions
+mainland
+Taiwan
+Chinese
+(China) and
+1,021,482
+Total
+Other
+-
+As at 31 December 2020
+Corporate loans and advances
+Trade bills
+Total
+Personal loans
+- Other
+- Trade bills
+Corporate loans and advances
+Personal loans
+6,469,397
+5,462,380
+94,900
+1,087,192
+570,435
+Total
+389
+14,183,385
+983,660
+1,697,934
+11,501,791
+5,583,295
+60,099
+7,444,532
+821,692
+1,155,558
+101,869
+970,413
+5,551,519
+4,979,859
+15,674,994
+969,208
+1,752,527
+12,953,259
+6,093,750
+139,539 1,255,921
+768,734 8,325,323
+60,935
+As at 31 December 2021
+Macao
+83,276
+1,071,321
+543,337
+(ii) Analysis of loans and advances to customers by customer type
+14.74%
+1,695,932
+13.99%
+4.23%
+39.82%
+5,158,395
+Eastern China
+1,811,146
+548,436
+Northeastern China
+Northern China
+502,186
+% of total
+Amount
+2020
+2021
+As at 31 December
+Chinese mainland
+100.00%
+Hong Kong
+(China),
+100.00% 14,183,385
+Amount
+4.37%
+% of total
+39.17%
+2.5 Loans and advances (Continued)
+4,505,204
+(1) Concentrations of risk for loans and advances to customers (Continued)
+2 Credit risk (Continued)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+388
+12,953,259 100.00% 11,501,791 100.00%
+FOR THE YEAR ENDED 31 DECEMBER 2021
+13.32%
+13.33% 1,531,850
+1,726,467
+Western China
+28.40%
+28.63% 3,266,619
+Total
+3,708,815
+Central and Southern China
+299,871
+Subtotal
+8,087,111
+44.58%
+7,590,104
+44.97%
+160,419
+0.88%
+206,146
+6.83%
+1.22%
+Others
+Certificates of deposit
+1,152,825
+293,935
+1,157,382
+and regions
+Taiwan (China) and other countries
+Hong Kong (China), Macao (China),
+1.78%
+300,406
+1.62%
+Foreign currency
+36.36%
+36.58% 6,136,873
+6,635,794
+1.65%
+Chinese mainland: RMB
+Personal deposits
+6.38%
+249,842
+HKD 7.81% 1,318,279
+Total deposits
+Cash Flow Analysis
+52.33%
+Contingent liabilities and commitments include legal proceedings and arbitrations, assets
+pledged, collateral accepted, capital commitments, operating leases, Treasury bond redemption
+commitments, credit commitments and underwriting obligations, etc. Please refer to Note V.40 to
+the Consolidated Financial Statements for more detailed information on contingent liabilities and
+commitments.
+The Group entered into various derivative financial instruments relating to foreign currency
+exchange rates, interest rates, equity, credit, precious metals and other commodities for trading,
+hedging, asset and liability management and on behalf of customers. Please refer to Note V.16
+to the Consolidated Financial Statements for the contractual/notional amounts and fair values of
+derivative instruments.
+Off-balance sheet items include derivative financial instruments, contingent liabilities and
+commitments, etc.
+Off-balance Sheet Items
+As at the end of 2021, the Group's total equity stood at RMB2,350.553 billion, an increase of
+RMB187.716 billion or 8.68% compared with the prior year-end. This was primarily attributable
+to the following factors: (1) In 2021, the Group realised a profit for the year of RMB227.339
+billion, among which profit attributable to equity holders of the Bank amounted to RMB216.559
+billion. (2) The Bank pushed forward its external capital replenishment projects in a proactive
+and prudent manner, successfully issuing RMB70.0 billion of undated capital bonds. It also
+strengthened the management of existing capital instruments and redeemed RMB28.0 billion of
+domestic preference shares. (3) As per the 2020 profit distribution plan approved at the Annual
+General Meeting, a cash dividend of RMB57.994 billion was paid out on ordinary shares. (4)
+The Bank paid a dividend on its preference shares of RMB5.1895 billion. Please refer to the
+"Consolidated Statement of Changes in Equity" in the Consolidated Financial Statements for
+detailed information.
+Equity
+The Bank constantly strengthened its liability quality management, with relevant indicators
+meeting internal and external management requirements. It streamlined relevant systems and
+mechanisms, optimised product functions, and increased the expansion of customer deposits. It
+strengthened internal and external pricing management, effectively controlled increases in costs,
+improved its market financing capability to allow for greater initiative in acquiring liabilities,
+and controlled the mismatch in liabilities' terms and currencies at a reasonable level in order to
+support the comprehensive and balanced development of its assets and liabilities, thus effectively
+improving liability quality management.
+38
+The Bank earnestly implemented regulatory requirements on liability quality management and
+optimised its governance structure for liability quality management. It formulated measures and
+improved its internal control and indicator systems for liability quality management, periodically
+re-examining indicator limits. It effectively managed the source, structure and cost of its
+liabilities in accordance with its business strategy, risk appetite, business characteristics and other
+factors, and continuously monitored and analysed the status of its liability quality management,
+thus ensuring an appropriate balance between safety, liquidity and profitability.
+Liability Quality Management
+-Other 5.37% 906,411
+9.78% 1,651,454
+USD
+77.04% 13,003,027
+RMB
+18,142,887
+100.00%
+16,879,171
+100.00%
+Note: "Others" includes accrued interest.
+Due to Customers by Currency
+1.48%
+Unit: RMB million, except percentages
+RMB 77.98% 14,148,220
+-USD 9.73% 1,765,005
+-HKD 7.23% 1,311,343
+-Other 5.06% 918,319
+Unit: RMB million, except percentages
+As at 31 December 2020
+As at 31 December 2021
+8,833,079
+Subtotal
+10.47% 1,818,563
+52.89%
+285,430
+Others
+47.02%
+6,437,279
+46.48%
+6,929,729
+As at the end of 2021, the balance of the Group's cash and cash equivalents was RMB 1,975.631
+billion, an increase of RMB480.763 billion compared with the prior year-end.
+2.75%
+375,812
+2.00%
+297,935
+Structured deposits
+25.30%
+3,463,984
+26.29%
+3,920,101
+Time deposits
+2.15%
+232,736
+1.70%
+Subtotal
+7,695,590
+51.61%
+Total
+7,014,516
+Personal deposits
+Demand deposits
+2,711,693
+18.19%
+2,597,483
+18.97%
+51.24%
+10.78%
+14,910,749
+238,943
+9,595,486
+Subtotal
+1,899,896
+and regions
+Taiwan (China) and other countries
+Hong Kong (China), Macao (China),
+3.32%
+560,993
+4.12%
+746,501
+Foreign currency
+38.23%
+6,453,523
+38.30%
+6,949,089
+Chinese mainland: RMB
+Corporate deposits
+1.74%
+13,690,738
+100.00%
+Note: "Others" is inclusive of accrued interest.
+37
+Due to Customers by Geography
+1.91%
+100.00%
+Items
+As at 31 December 2021
+As at 31 December 2020
+Amount
+% of total
+Amount
+% of total
+Unit: RMB million, except percentages
+39
+Total
+0.69%
+(46,650)
+1 Bp
+Total
+12,067,249
+4.38%
+10,677,188
+4.49%
+1,390,061
+(11) Bps
+Including:
+Medium and long-term loans
+9,072,085
+4.73%
+7,887,644
+2.65%
+4.83%
+(10) Bps
+Short-term loans within 1 year and others
+2,995,164
+3.31% 2,789,544
+3.52%
+205,620
+(21) Bps
+Due to customers
+Corporate demand deposits
+3,693,355
+0.82% 3,469,983
+0.75%
+223,372
+7 Bps
+1,184,441
+334,182
+2.66%
+287,532
+320,078
+The average balances and average interest rates of loans and due to customers in the Chinese
+mainland, classified by business type, are summarised in the following table:
+2021
+2020
+Average Average
+Items
+balance
+interest rate
+Average
+balance
+Average
+interest rate
+Change
+Average
+Average
+balance interest rate
+RMB businesses in the Chinese mainland
+Unit: RMB million, except percentages
+Loans
+Corporate loans
+Trade bills
+(5) Bps
+533,472
+4.88%
+4,710,348
+4.83%
+Corporate time deposits
+5,243,820
+(19) Bps
+903,239
+4.27%
+5,632,658
+4.08%
+6,535,897
+Personal loans
+17,835
+2,614,618
+2,417,325
+0.97%
+43,182
+1.69%
+1,847
+(72) Bps
+Due to customers
+Corporate demand deposits
+76,620
+0.25%
+52,111
+0.46%
+24,509
+(21) Bps
+Corporate time deposits
+45,029
+31,506
+31,931
+1.76%
+(425)
+(98) Bps
+Personal demand deposits
+26,307
+0.01%
+26,516
+0.02%
+(209)
+(1) Bp
+Personal time deposits
+16,390
+0.40%
+0.78%
+Loans
+in the Chinese mainland
+Unit: USD million, except percentages
+2.82%
+197,293
+3 Bps
+Personal demand deposits
+2,387,414
+0.35%
+2,266,307
+0.39%
+121,107
+(4) Bps
+Personal time deposits
+3,671,859
+3.07%
+3,092,794
+3.00%
+579,065
+7 Bps
+Foreign currency businesses
+5 Bps
+968,670
+1.85%
+12,063,140
+1.90%
+2.85%
+13,031,810
+(152,167)
+3.40%
+816,731
+3.22%
+664,564
+Other
+(18) Bps
+Structured deposits
+(1,445)
+2,616,098
+998
+30,581
+31,579
+Insurance benefits and claims
+4.57%
+250
+3.26%
+5,465
+Taxes and surcharges
+4.42%
+1,011
+22,871
+23,882
+Depreciation and amortisation
+5,715
+21.72%
+Other
+15,216
+The Bank committed itself to the nation's new development philosophy, dynamically adjusted
+its business strategies and continuously improved its business structure, thus achieving steady
+growth in asset and liability scale. As at the end of 2021, the Group's total assets amounted
+to RMB26,722.408 billion, an increase of RMB2,319.749 billion or 9.51% compared with the
+prior year-end. The Group's total liabilities amounted to RMB24,371.855 billion, an increase of
+RMB2,132.033 billion or 9.59% compared with the prior year-end.
+Financial Position Analysis
+In 2021, the Group incurred income tax of RMB49.281 billion, an increase of RMB7.999 billion
+or 19.38% compared with the prior year. The Group's effective tax rate was 17.82%. Please refer
+to Note V.10 to the Consolidated Financial Statements for the reconciliation of statutory income
+tax expense to effective income tax expense.
+Income Tax Expense
+32
+The Bank continued to improve its comprehensive risk management system and adopted a
+proactive and forward-looking risk management approach, thus ensuring generally stable
+credit asset quality. It stringently implemented a prudent and solid risk provisioning policy and
+maintained adequate capacity for risk mitigation. In 2021, the Group's impairment losses on
+assets totalled RMB 104.220 billion, a decrease of RMB 14.796 billion or 12.43% compared with
+the prior year. Please refer to the section "Risk Management Credit Risk Management" and
+Notes V.9, 17 and VI.2 to the Consolidated Financial Statements for more information on loan
+quality and allowance for loan impairment losses.
+18,459
+Impairment Losses on Assets
+23,944
+202,411
+226,355
+Total
+21.31%
+3,243
+11.83%
+8,459
+38,944
+47,403
+9,056
+58,605
+67,661
+Other operating income
+(6,350) (66.51%)
+9,547
+15.45%
+3,197
+20,236 251.22%
+8,055
+28,291
+Net trading gains
+Change Change (%)
+2020
+Net gains on transfers of financial asset
+Total
+99,149
+76,207
+11.17%
+9,983
+89,334
+99,317
+2020
+2021
+administrative expenses
+General operating and
+Staff costs
+Items
+Unit: RMB million, except percentages
+Change Change (%)
+The Bank continued to operate its business in a prudent manner. It optimised its cost structure,
+increased investment in technological innovation, and allocated greater resources to key products,
+areas and regions, thus further improving input and output efficiency. In 2021, the Group
+recorded operating expenses of RMB226.355 billion, an increase of RMB23.944 billion or
+11.83% compared with the prior year. The Group's cost to income ratio (calculated in accordance
+with regulations in the Chinese mainland) was 28.17%. Please refer to Notes V.6, 7 to the
+Consolidated Financial Statements for detailed information.
+Operating Expenses
+30.10%
+22,942
+The principal components of the Group's consolidated statement of financial position are set out
+below:
+Items
+Unit: RMB million, except percentages
+As at 31 December 2021
+Amount
+Note: "Other borrowed funds” includes bonds issued and other borrowings.
+100.00%
+22,239,822
+100.00%
+24,371,855
+Total liabilities
+33
+3.93%
+3.15%
+767,873
+Other liabilities
+5.71%
+5.81% 1,270,437
+1,415,032
+873,451
+Loans and Advances to Customers
+The Bank earnestly fulfilled its responsibilities as a large state-owned bank, increased support
+for the real economy, achieved solid growth in lending scale, bolstered support for business
+expansion in such key areas as inclusive finance, green finance and strategic emerging industries,
+continued to improve its credit structure, thoroughly implemented major regional strategies and
+coordinated regional development strategies, and effectively served the development of local
+economies and people's livelihoods. As at the end of 2021, the Group's loan and advances
+to customers amounted to RMB15,712.574 billion, an increase of RMB1,496.097 billion or
+10.52% compared with the prior year-end. Specifically, the Group's RMB loans and advances
+to customers totalled RMB12,758.658 billion, an increase of RMB1,419.668 billion or 12.52%
+compared with the prior year-end, while its foreign currency loans amounted to USD463.309
+billion, an increase of USD22.308 billion or 5.06% compared with the prior year-end. Please refer
+to Note V.17 to the Consolidated Financial Statements for detailed information.
+The Bank further improved its risk management system, paid close attention to changes in the
+macroeconomic situation, strengthened risk identification and management in key areas and made
+greater efforts in the disposal of non-performing assets, thus maintaining generally stable asset
+quality. As at the end of 2021, the balance of the Group's allowance for loan impairment losses
+amounted to RMB390.541 billion, an increase of RMB21.922 billion compared with the prior
+year-end. The balance of the Group's restructured loans amounted to RMB23.213 billion, an
+increase of RMB1.521 billion compared with the prior year-end.
+Taiwan (China) and other countries
+Hong Kong (China), Macao (China),
+1.80%
+44.08%
+6,266,331
+255,601
+45.58%
+2.10%
+329,463
+Foreign currency
+7,161,416
+Chinese mainland: RMB
+Corporate loans
+As at 31 December 2021
+Amount % of total
+Unit: RMB million, except percentages
+As at 31 December 2020
+Amount % of total
+Items
+Loans and Advances to Customers by Geography
+Other borrowed funds
+2021
+14.46%
+4,046,063
+Due from and placements with banks and
+8.51%
+8.34% 2,076,840
+2,228,726
+Balances with central banks
+22.91%
+other financial institutions
+56.75%
+6,164,671
+15,322,484
+Loans and advances to customers, net
+Investments
+Assets
+As at 31 December 2020
+Amount % of total
+% of total
+57.34% 13,848,304
+23.07% 5,591,117
+1,842,711
+6.90% 1,663,640
+6.82%
+due to central banks
+other financial institutions and
+Due to and placements from banks and
+75.90%
+74.44% 16,879,171
+18,142,887
+Due to customers
+Liabilities
+100.00%
+5.01%
+4.35% 1,222,758
+100.00% 24,402,659
+26,722,408
+Total assets
+1,163,816
+Other assets
+16.60% 3,216,763
+and regions
+Items
+The Group realised other non-interest income of RMB99.149 billion, an increase of RMB22.942
+billion or 30.10% compared with the prior year. This was primarily attributable to an increase
+in net trading gains compared with the prior year as a result of market price fluctuations. Please
+refer to Notes V.3, 4, 5 to the Consolidated Financial Statements for detailed information.
+Consultancy and advisory fees
+(0.37%)
+(44)
+11,912
+11,868
+Credit commitment fees
+4,576
+6.87%
+14,383
+15,371
+Settlement and clearing fees
+(8.01%)
+(1,108)
+13,825
+988
+12,717
+3,535
+29.45%
+8,916
+8,126
+Other
+32.48%
+1,569
+4,831
+1,041
+6,400
+(5.98%)
+(351)
+5,871
+5,520
+exchange business
+Spread income from foreign
+Custodian and other fiduciary service fees
+Bank card fees
+17.77%
+4,508
+0.74%
+130,192
+0.36%
+153,428
+Total
+(33) Bps
+23,236
+806
+1,799
+1.73%
+2,605
+19.11%
+Other
+(29) Bps
+2.06%
+(38) Bps
+Note: "Due to customers
+Other" includes structured deposits.
+25,367
+29,875
+Agency commissions
+Group
+Change Change (%)
+2020
+2021
+Items
+Unit: RMB million, except percentages
+Changes in net fee and commission income are set out below:
+The Group earned net fee and commission income of RMB81.426 billion, an increase of
+RMB5.904 billion or 7.82% compared with the prior year. Net fee and commission income
+represented 13.44% of operating income. The Bank actively seized market opportunities and
+tapped into businesses with strong potential. As a result, it realised robust growth in income from
+its fund distribution and custody businesses.
+Net Fee and Commission Income
+In 2021, the Group reported non-interest income of RMB180.575 billion, an increase of
+RMB28.846 billion or 19.01% compared with the prior year. Non-interest income represented
+29.81% of operating income.
+Non-interest Income
+30
+(790)
+(8.86%)
+Fee and commission income
+94,453
+8,031
+Other
+33.30%
+1,557
+4,675
+6,232
+4,883
+Custodian and other fiduciary service fees
+(249)
+5,307
+exchange business
+Spread income from foreign
+34.52%
+1,146
+(4.48%)
+3,148
+64.47%
+Fee and commission income
+Other Non-interest Income
+31
+10.63%
+6,183
+58,157
+64,340
+39.39%
+(3,557)
+(9,030)
+(12,587)
+Fee and commission expense
+Net fee and commission income
+14.50%
+9,740
+67,187
+76,927
+3,320
+Unit: RMB million, except percentages
+4,466
+(0.80%)
+Chinese mainland
+7.82%
+5,904
+75,522
+81,426
+Net fee and commission income
+Agency commissions
+(0.69%)
+(13,118)
+(13,027)
+Fee and commission expense
+6.56%
+5,813
+88,640
+91
+22,869
+18,289
+4,580
+(46)
+5,779
+5,733
+Credit commitment fees
+6.86%
+886
+12,913
+13,799
+Settlement and clearing fees
+(10.89%)
+(1,282)
+11,772
+10,490
+Bank card fees
+25.04%
+Consultancy and advisory fees
+2,090,365
+5,556
+2,078,158
+Bond issued by policy banks in 2018
+2028-02-09
+4.88%
+11,092
+Bond issued by policy banks in 2018
+2027-09-08
+10,730
+4.39%
+Bond issued by policy banks in 2017
+2029-05-21
+3.65%
+12,576
+Bond issued by policy banks in 2019
+2030-04-17
+12,510
+2.96%
+4.73%
+Bond issued by policy banks in 2020
+In order to improve both the scale and pricing of deposits, the Bank continuously accelerated
+product and service innovation, improved scenario building, enhanced its financial services
+offering and expanded the scale of customers' financial assets. It actively expanded the sources
+of its deposits, including from salary payment agency, third-party custody, cash management and
+social security cards, with the increment of domestic RMB deposits reaching a record high. The
+Bank also improved management modes for its liability business, including certificates of deposit
+(CDs), structured deposits and negotiated deposits. It effectively controlled interest rates paid on
+Due to Customers
+Note: Financial bonds refer to debt securities issued by financial institutions in the bond market, including the bonds
+issued by policy banks, other banks and non-bank financial institutions, but excluding restructured bonds and
+PBOC bills.
+2022-04-17
+4.02%
+8,580
+2025-04-02
+Bond issued by policy banks in 2017
+3.75%
+8,725
+Bond issued by policy banks in 2019
+2030-03-23
+3.23%
+10,008
+2029-01-25
+12,610
+Bond issued by policy banks in 2020
+2029-01-08
+Unit: RMB million, except percentages
+-Other 5.29% 326,459
+-HKD 4.22% 260,080
+13.00% 801,236
+-USD
+77.49% 4,776,896
+As at 31 December 2020
+RMB
+Unit: RMB million, except percentages
+Investments by Currency
+35
+Note: "Equity instruments and others" includes accrual interest.
+100.00%
+5,591,117
+As at 31 December 2021
+Top Ten Financial Bonds by Value Held by the Group
+RMB
+78.09% 4,366,310
+3.48%
+12,826
+Bond issued by policy banks in 2019
+2025-01-12
+4.98%
+13,370
+Bond issued by policy banks in 2018
+Unit: RMB million, except percentages
+Impairment Allowance
+Annual Rate Maturity Date
+Par Value
+Bond Name
+Other 5.56% 310,877
+-HKD 3.80% 212,522
+12.55% 701,408
+USD
+36
+deposits, leading to continuous improvement in the development quality of its deposit business.
+As at the end of 2021, the Group's due to customers amounted to RMB18,142.887 billion, an
+increase of RMB1,263.716 billion or 7.49% compared with the prior year-end. Specifically, the
+Group's RMB due to customers totalled RMB14,148.220 billion, an increase of RMB1,145.193
+billion or 8.81% compared with the prior year-end, while its foreign currency due to customers
+stood at USD626.546 billion, an increase of USD32.492 billion or 5.47% compared with the prior
+year-end.
+The principal components of due to customers of the Group and its institutions in the Chinese
+mainland are set out below:
+Items
+299,871
+Others
+1.22%
+206,146
+0.88%
+160,419
+1.65%
+Certificates of deposit
+7,590,104
+44.58%
+8,087,111
+Subtotal
+2.25%
+379,680
+44.97%
+249,842
+1.48%
+Total
+19.40%
+2,892,996
+Time deposits
+13.30%
+30.43%
+4,165,682
+30.06%
+4,482,516
+Demand deposits
+Corporate deposits
+Chinese mainland
+100.00%
+16,879,171
+100.00%
+18,142,887
+1.66%
+100.00%
+300,628
+22.84%
+21.46%
+3,621,775
+21.87%
+Time deposits
+29.37%
+4,956,751
+Structured deposits
+29.08%
+Demand deposits
+million, except percentages
+As at 31 December 2020
+Amount % of total
+As at 31 December 2021
+Amount % of total
+Unit: RMB
+Corporate deposits
+Group
+5,275,514
+351,445
+1.94%
+254,553
+3,854,531
+23.70%
+4,299,050
+Time deposits
+19.88%
+19.22% 3,355,893
+3,487,433
+Demand deposits
+Personal deposits
+52.33%
+8,833,079
+52.89%
+9,595,486
+Subtotal
+1.50%
+Structured deposits
+6,164,671
+3,968,527
+4.48%
+9.02%
+504,549
+9.11%
+561,642
+Financial assets at fair value through profit or loss
+Amount % of total
+Financial assets at fair value through other
+% of total
+Items
+As at 31 December 2021
+As at 31 December 2020
+Unit: RMB million, except percentages
+The classification of the Group's financial investment portfolio is shown below:
+The Bank closely tracked financial market dynamics, maintained investment activity at a
+reasonable pace and continuously improved its investment structure. As at the end of 2021,
+the Group held investments of RMB6,164.671 billion, an increase of RMB573.554 billion or
+10.26% compared with the prior year-end. Specifically, the Group's RMB investments totalled
+RMB4,776.896 billion, an increase of RMB410.586 billion or 9.40% compared with the prior
+year-end, while foreign currency investments totalled USD217.666 billion, an increase of
+USD29.953 billion or 15.96% compared with the prior year-end.
+Amount
+comprehensive income
+2,389,830
+38.77%
+Unit: RMB million, except percentages
+Items
+Investments by Issuer Type
+100.00%
+5,591,117
+100.00%
+6,164,671
+Total
+53.28%
+2,978,778
+52.12%
+3,213,199
+Financial assets at amortised cost
+37.70%
+2,107,790
+Investments
+As at 31 December 2020
+4
+100.00%
+Foreign currency
+35.02%
+4,979,214
+34.76%
+5,461,645
+Chinese mainland: RMB
+735
+Personal loans
+8,600,090
+14.62%
+Total
+60.98%
+9,581,244
+Subtotal
+60.50%
+0.00%
+645
+0.01%
+0.23%
+0.24%
+100.00%
+37,580
+15,712,574
+Total loans
+Accrued interest
+39.27%
+4.24%
+603,436
+5,583,295
+4.02%
+38.78%
+6,093,750
+Subtotal
+631,370
+and regions
+Taiwan (China) and other countries
+Hong Kong (China), Macao (China),
+34
+As at 31 December 2021
+33,092
+14,216,477
+Amount % of total
+65,825
+1.62%
+100,072
+Public sector and quasi-governments
+9.95%
+556,612
+1.18%
+10.48%
+Governments
+250,398
+other countries and regions
+Macao (China), Taiwan (China) and
+Issuers in Hong Kong (China),
+78.78%
+646,221
+158,740
+2.58%
+172,107
+304,218
+Equity instruments and others
+4.93%
+16.74%
+Amount % of total
+936,020
+17.07%
+1,052,242
+Subtotal
+2.53%
+141,476
+2.39%
+147,209
+Corporates
+3.08%
+4,404,699
+78.00%
+Financial institutions
+Subtotal
+532,783
+Policy banks
+2.34%
+130,695
+164,741
+Public sector and quasi-governments
+8.64%
+54.25%
+Debt securities
+4,808,211
+51.64%
+3,183,332
+Government
+Issuers in the Chinese mainland
+3,033,111
+447,037
+2.67%
+2.73%
+152,433
+3.88%
+216,751
+152,433
+4.37%
+269,345
+China Orient Asset Management Corporation
+7.99%
+2.47%
+7.59%
+424,672
+8.21%
+505,577
+Financial institutions
+Corporates
+608
+2.42%
+0.66%
+0.29%
+0.43%
+Other
+1.32%
+164,796
+861
+0.42%
+2.17%
+Subtotal
+78.93%
+2.20%
+157,767
+894
+76.12%
+Personal loans
+1.39%
+3,806
+2,215
+1.12%
+Mortgages
+2,319
+0.76%
+0.95%
+Construction
+3,406
+1.63%
+1.06%
+1.28%
+1.74%
+Mining
+4,717
+2.26%
+2.92%
+4,537 2.19%
+2.78%
+Public utilities
+1.84%
+11,628
+189,985
+0.27%
+0.65%
+Total for Chinese mainland
+193,030
+92.45%
+1.49%
+91.66%
+1.65%
+Hong Kong (China), Macao
+(China), Taiwan (China) and
+other countries and regions
+15.54%
+15,762
+0.58%
+17,288
+8.34%
+0.64%
+1.33%
+1.08%
+Total
+208,792 100.00%
+7.55%
+32,218
+0.52%
+13.52%
+12,680
+6.12%
+0.32%
+Credit cards
+10,163
+4.87%
+2.05%
+12,199
+5.88%
+2.50%
+Other
+6,443
+3.08%
+0.99%
+7,339
+3.54%
+1.47%
+Subtotal
+28,234
+5.57%
+2,257
+Total
+Water, environment and
+1.65%
+394
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+100.00%
+2.5 Loans and advances (Continued)
+(iii) Impaired loans and advances by geographical area and industry
+As at 31 December
+2021
+2020
+Impaired
+Impaired
+Amount % of total loan ratio
+Amount % of total loan ratio
+(2) Analysis of loans and advances to customers by impairment status (Continued)
+1.49% 189,985
+193,030 100.00%
+0.65%
+1.46%
+100.00%
+207,273 100.00%
+Chinese mainland
+As at 31 December
+2021
+2020
+% Impaired
+% Impaired
+Amount
+of total loan ratio
+Amount
+of total loan ratio
+Corporate loans and advances
+Personal loans
+164,796 85.37%
+28,234 14.63%
+2.20% 157,767
+0.52% 32,218
+83.04%
+2.42%
+16.96%
+Chinese mainland
+Corporate loans and advances
+Commerce and services
+30,111
+5.05%
+29,952
+14.45%
+4.68%
+Production and supply of
+electricity, heating, gas and water
+13,173
+6.31%
+2.00%
+2,374
+1.14%
+0.43%
+Financial services
+201
+0.10%
+0.04%
+42
+0.02%
+0.01%
+16.62%
+public utility management
+34,694
+1.09%
+14.42%
+1.89%
+42,010
+20.27%
+3.01%
+Manufacturing
+55,341
+26.50%
+3.57%
+56,696
+27.35%
+4.26%
+Transportation, storage and
+postal services
+18,073
+8.66%
+1.14%
+14,276
+6.89%
+Real estate
+1.46%
+Collateralised and other secured loans
+BANK OF CHINA LIMITED
+(i) Analysis of overdue loans and advances to customers by collateral type and overdue days
+Group
+Past due
+Past due
+Past due
+up to
+91 to
+361 Days to
+(4) Overdue loans and advances to customers
+Past due
+360 days
+3 years
+over 3 years
+Total
+As at 31 December 2021
+Unsecured loans
+10,607
+12,893
+90 days
+2.5 Loans and advances (Continued)
+2 Credit risk (Continued)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+Collateral of impaired corporate loans and advances includes land, buildings, equipment and
+others. The fair value of collateral was estimated by the Group with reference to the latest
+available external valuations adjusted for recent experience in disposal of collateral as well
+as the market conditions.
+397
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(3) Loans and advances rescheduled
+Rescheduled loans refer to loans in which the Group has adjusted the repayment terms of the
+loan contract for which the borrower is in financial difficulty or unable to repay. The Group
+reschedules a non-performing loan only if the borrower has good prospects.
+Rescheduled loans are subject to a surveillance period of six months. During the surveillance
+period, rescheduled loans remain as non-performing loans and the Group monitors the
+borrower's business operations and loan repayment patterns. After the surveillance period,
+rescheduled loans may be upgraded to “Special-mention” upon review if certain criteria are
+met. If the rescheduled loans fall due or if the borrowers are unable to demonstrate their
+repayment ability, these loans will be reclassified to "Doubtful" or below. All rescheduled
+loans within the surveillance period were determined to be impaired as at 31 December 2021
+and 2020.
+As at 31 December 2021 and 2020, within impaired loans and advances, rescheduled loans
+and advances that were overdue for 90 days or less were insignificant.
+398
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+2,939
+31,483
+1,181
+Guaranteed loans
+Guaranteed loans
+5,160
+11,622
+9,952
+1,507
+28,241
+Collateralised and other secured loans
+41,142
+33,317
+43,635
+5,857
+117,826
+Total
+54,342
+71,098
+44,266
+1.33% 207,273
+9,678
+27,192
+2,314
+7,122
+15,841
+2,532
+32,096
+5,105
+833
+40,566
+30,875
+26,302
+38,614
+3,760
+99,551
+Total
+44,014
+71,291
+46,658
+5,774
+167,737
+As at 31 December 2020
+Unsecured loans
+8,040
+27,620
+30,157
+33,859
+33,975
+(3,708)
+2,376
+Other countries and regions
+9,678
+(4,010)
+5,668
+Total
+208,792
+6,084
+(169,900)
+As at 31 December 2020
+Chinese mainland
+189,985
+(151,489)
+38,496
+Hong Kong (China), Macao (China) and
+Taiwan (China)
+Other countries and regions
+38,892
+Taiwan (China)
+Hong Kong (China), Macao (China) and
+30,848
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(2) Analysis of loans and advances to customers by impairment status (Continued)
+(iv) Impaired loans and advances and related allowance by geographical area
+Allowance
+for
+Impaired
+loans
+impairment
+losses
+Net
+As at 31 December 2021
+Chinese mainland
+193,030
+(162,182)
+4,674
+12,614
+(2,463)
+2,211
+(8,943)
+2021
+2020
+Portion covered
+104,680
+95,896
+96,423
+89,692
+Portion not covered
+74,846
+78,116
+68,373
+68,075
+Total
+Fair value of
+collateral held
+179,526
+174,012
+164,796
+157,767
+2020
+395
+2021
+As at
+3,671
+Total
+207,273
+(162,895)
+44,378
+396
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(2) Analysis of loans and advances to customers by impairment status (Continued)
+(v) Within the impaired corporate loans and advances, the portions covered and not covered by
+collateral held are as follows:
+Group
+As at
+As at
+Chinese mainland
+As at
+31 December 31 December 31 December 31 December
+208,792 100.00%
+161,402
+174,012 83.95% 2.02%
+33,261 16.05% 0.60%
+2020
+Amount
+% of total
+Amount
+% of total
+Corporate loans and advances
+Commerce and services
+1,589,119
+2021
+12.27%
+12.13%
+Manufacturing
+1,549,639
+11.96%
+1,329,778
+11.56%
+Transportation, storage and
+postal services
+1,395,690
+As at 31 December
+Chinese mainland
+(iii) Analysis of loans and advances to customers by industry (Continued)
+666,099
+4.70%
+Subtotal
+6,093,750
+38.88% 5,583,295
+39.36%
+15,674,994
+100.00% 14,183,385
+100.00%
+390
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(1) Concentrations of risk for loans and advances to customers (Continued)
+1,578,645
+3.51%
+12.19%
+11.42%
+Construction
+266,775
+2.06%
+218,541
+1.90%
+Mining
+161,473
+1.25%
+2.12%
+163,193
+Public utilities
+159,284
+1.23%
+136,444
+1.19%
+Other
+46,175
+0.36%
+1.42%
+243,268
+2.28%
+295,183
+Real estate
+687,186
+5.30%
+639,777
+5.56%
+Production and supply of
+electricity, heating,
+gas and water
+657,020
+5.07%
+554,626
+4.82%
+Financial services
+500,380
+3.86%
+487,488
+4.24%
+Water, environment and
+public utility management
+1,313,457
+498,435
+3.24%
+4.85%
+507,107
+760,231
+12.05%
+13.04% 1,764,213
+1,692,261
+12.44%
+11.93%
+Transportation, storage and
+postal services
+1,729,701
+11.03%
+1,888,582
+1,493,828
+Real estate
+1,212,336
+7.73%
+1,137,469
+8.02%
+Production and supply of
+electricity, heating,
+gas and water
+10.53%
+Manufacturing
+2,043,199
+Commerce and services
+179,384
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(1) Concentrations of risk for loans and advances to customers (Continued)
+(iii) Analysis of loans and advances to customers by industry
+Group
+As at 31 December
+2021
+2020
+Amount
+% of total
+Amount
+% of total
+Corporate loans and advances
+836,651
+5.34%
+726,824
+5.13%
+1.09%
+1.14%
+Other
+128,324
+0.82%
+175,493
+1.24%
+Subtotal
+9,581,244
+61.12%
+8,600,090
+60.64%
+Personal loans
+Mortgages
+4,826,412
+30.79% 4,418,761
+31.15%
+Credit cards
+Other
+170,548
+39,670
+Public utilities
+282,394
+Financial services
+704,486
+4.49%
+646,979
+4.56%
+Water, environment and
+public utility management
+302,591
+1.93%
+250,551
+1.77%
+Construction
+296,668
+1.89%
+268,676
+1.89%
+Mining
+268,158
+1.71%
+1.99%
+Total
+0.34%
+7,490,879
+Macao (China) and
+Taiwan (China)
+Other countries and regions
+6,084 2.91%
+9,678 4.64%
+0.35% 4,674
+1.00% 12,614
+2.25%
+0.28%
+6.09%
+Hong Kong (China),
+1.28%
+208,792
+100.00%
+1.33%
+207,273
+100.00%
+1.46%
+Chinese mainland
+As at 31 December
+Total
+1.65%
+91.66%
+189,985
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(2) Analysis of loans and advances to customers by impairment status
+(i) Impaired loans and advances by geographical area
+Group
+As at 31 December
+2021
+2020
+% Impaired
+Amount
+of total loan ratio
+Amount
+% Impaired
+of total loan ratio
+Chinese mainland
+193,030
+92.45%
+1.49%
+2021
+(Amount in millions of Renminbi, unless otherwise stated)
+2020
+Impaired
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(2) Analysis of loans and advances to customers by impairment status (Continued)
+(ii) Impaired loans and advances by customer type
+Group
+As at 31 December
+2021
+(Amount in millions of Renminbi, unless otherwise stated)
+2020
+% Impaired
+Amount
+of total loan ratio
+Amount
+of total loan ratio
+Corporate loans and advances
+Personal loans
+179,526 85.98%
+29,266 14.02%
+1.87%
+0.48%
+% Impaired
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+% Impaired
+Amount
+of total loan ratio
+Amount
+of total loan ratio
+Northern China
+Northeastern China
+Eastern China
+Central and Southern China
+Western China
+38,825 20.11% 2.14% 27,699 14.58% 1.63%
+13,939 7.22% 2.54% 15,229 8.02% 3.03%
+51,633 26.75% 1.00% 52,199 27.47% 1.16%
+73,624 38.14% 1.99% 81,201 42.74% 2.49%
+15,009 7.78%
+0.87% 13,657
+7.19% 0.89%
+Total
+193,030 100.00%
+1.49%
+189,985
+100.00%
+1.65%
+393
+%
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+100.00%
+391
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+100.00% 11,501,791
+2.5 Loans and advances (Continued)
+(iv) Analysis of loans and advances to customers by collateral type
+Group
+As at 31 December
+2021
+2020
+Amount
+% of total
+Amount
+(1) Concentrations of risk for loans and advances to customers (Continued)
+12,953,259
+43.30%
+42.17% 4,979,859
+57.83%
+6,521,932
+56.70%
+Personal loans
+Mortgages
+4,316,325
+33.32% 3,991,540
+34.71%
+Credit cards
+Other
+496,299
+649,756
+3.83%
+5.02%
+488,086
+4.24%
+500,233
+4.35%
+Subtotal
+Total
+5,462,380
+% of total
+Unsecured loans
+5,008,610
+Guaranteed loans
+Unsecured loans
+3,801,150
+29.35%
+3,311,387
+28.79%
+Guaranteed loans
+1,487,175
+11.48% 1,379,925
+12.00%
+Collateralised and
+other secured loans
+7,664,934
+59.17% 6,810,479
+59.21%
+Total
+12,953,259
+100.00% 11,501,791
+100.00%
+392
+% of total
+Subtotal
+Amount
+Amount
+1,863,868
+31.95%
+11.89%
+4,533,495
+31.96%
+1,737,379
+12.25%
+Collateralised and
+other secured loans
+8,802,516
+56.16% 7,912,511
+55.79%
+Total
+15,674,994
+100.00% 14,183,385
+100.00%
+Chinese mainland
+As at 31 December
+2021
+2020
+% of total
+399
+Total
+FOR THE YEAR ENDED 31 DECEMBER 2021
+8,683
+16,082
+Equity derivatives
+553
+844
+Commodity derivatives and other
+Interest rate derivatives
+13,657
+86,044
+111,726
+Risk-weighted assets for CVA
+62,415
+110,319
+Risk-weighted assets for CCPs
+18,487
+76,313
+63,151
+Currency derivatives
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.8 Derivatives
+The risk-weighted assets for counterparty credit risk ("CCR”) of derivatives of the Group
+are calculated in accordance with the Capital Rules for Commercial Banks (Provisional)
+and other relevant regulations under the advanced capital measurement approaches. For
+derivative transactions, risk-weighted assets for CCR include the risk-weighted assets for
+default risk, the risk-weighted assets for credit valuation adjustment ("CVA”) and the risk-
+weighted assets for central counterparties ("CCPs").
+The risk-weighted assets for default risk of derivatives of the Group are calculated
+in accordance with the Assets Measurement Rules for Counterparty Default Risks of
+Derivatives since 1 January 2019.
+The risk-weighted assets for the CCR of derivatives are as follows:
+As at 31 December
+2021
+2020
+Risk-weighted assets for default risk
+2,335
+404
+6,330
+2.9 Repossessed assets
+(Amount in millions of Renminbi, unless otherwise stated)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+408
+VaR for each risk factor is the independently derived largest potential loss in a specific
+holding period and within a certain confidence level due to fluctuations solely in that risk
+factor. The individual VaRs was not added up to the total VaR as there was a diversification
+effect due to correlation amongst the risk factors.
+(i) BOCI monitors its trading VaR for equity derivatives unit, fixed income unit and global commodity unit
+separately, which include equity risk, interest rate risk, foreign exchange risk and commodity risk.
+VI FINANCIAL RISK MANAGEMENT (Continued)
+1.37
+2.24
+0.90
+3.58
+1.51
+Total BOCI's trading VaR
+0.15
+4.30
+3 Market risk (Continued)
+3.2 Market risk measurement techniques and limits (Continued)
+(2) Banking book
+150,794
+228,375
+The Group obtained assets by taking possession of collateral held as security. Detailed
+information of such repossessed assets of the Group is disclosed in Note V.22.
+405
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+3
+409
+Sensitivity analysis on net interest income assumes that yield curves change in parallel
+while the structure of assets and liabilities remains unchanged, and does not take into
+consideration changes in customer behaviour, basis risk, etc. The Group made timely
+adjustments to the structure of its assets and liabilities, optimised the internal and external
+pricing strategy or implemented risk hedging based on changes in the market situation, and
+controlled the fluctuation of net interest income within an acceptable level.
+Sensitivity analysis on net interest income
+The Group assesses IRRBB primarily through an interest rate repricing gap analysis. Interest
+rate repricing gap analysis measures the difference between the amount of interest-earning
+assets and interest-bearing liabilities that must be repriced within certain periods. The Group
+employs the interest rate repricing gap analysis and takes the impact of the off-balance
+sheet business into consideration when calculating the indications of sensitivity of earnings
+to changing interest rates. The interest rate gap analysis is set out in Note VI.3.3 and also
+covers the trading book.
+Interest rate risk in the banking book (“IRRBB") refers to the risk of losses to a bank's
+economic value and to its overall earnings of banking book, arising from adverse
+movements in interest rates level or term structure. IRRBB mainly comes from repricing
+gaps between assets and liabilities in the banking book, and differences in changes in
+benchmarking interest rates for assets and liabilities. The Group is exposed to interest rate
+risk and fluctuations in market interest rates that will impact the Group's financial position.
+Total
+0.30
+4,996,704
+404
+252,933
+5,340,719
+403
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+4,605,047
+(Amount in millions of Renminbi, unless otherwise stated)
+2
+Credit risk (Continued)
+2.7 Debt securities (Continued)
+The carrying amounts (accrued interest excluded) of debt investments analysed by external
+credit ratings and expected credit losses are as follows:
+As at 31 December 2021
+12-month ECL
+VI FINANCIAL RISK MANAGEMENT (Continued)
+482,739
+Total
+936,020
+65,825
+- Financial institutions
+10,015
+127,643
+34,449
+172,107
+- Corporate
+Subtotal
+13,453
+89,307
+38,716
+141,476
+93,938
+752,579
+89,503
+Lifetime ECL
+392
+Total
+Stage 2
+Stage 1
+Stage 2
+Stage 3
+Unrated
+A to AAA
+452,851
+281
+Total
+392
+Lower than A
+182,704
+123
+182,827
+Total
+4,995,908
+4,360,353
+Lifetime ECL
+12-month ECL
+As at 31 December 2020
+Stage 3
+Unrated
+A to AAA
+641,510
+41
+500
+4,641,482
+Lower than A
+223,072
+775
+642,051
+4,641,482
+223,847
+Total
+5,506,064
+816
+500
+5,507,380
+Stage 1
+31,748
+0.20
+0.50
+2.18
+0.30
+11.41
+3.02
+Volatility risk
+11.83
+6.45
+39.35
+9.75
+Market risk
+3.1 Overview
+The Group is exposed to market risks from on-balance and off-balance businesses, that
+may cause losses to the Group as a result of adverse changes in market prices of interest
+rate, exchange rate, equities and commodities. Market risk arises from open positions in the
+trading and banking books. The trading book consists of positions in financial instruments
+and commodities that are held with trading intent or in order to hedge other elements of the
+trading book. The banking book consists of financial instruments not included in the trading
+book.
+The Board of Directors of the Group takes the ultimate responsibility for the oversight
+of market risk management, including the approval of market risk management policies
+and procedures and the determination of market risk tolerance. Senior management is
+responsible for the execution of such policies and ensuring that the level of market risk
+is within the risk appetite determined by the Board, while meeting the Group's business
+objectives.
+Market risk management departments are responsible for the identification, measurement,
+monitoring, control and reporting of market risks on a Group basis. Business units are
+responsible for the monitoring and reporting of market risk within their respective business
+lines.
+26.61
+0.18
+Commodity risk
+3.66
+407
+The reporting of risk in relation to bullion is included in foreign exchange risk above.
+16.18
+38.72
+29.56
+19.49
+52.57
+42.22
+VaR
+Total of the Bank's trading
+3.04
+13.76
+6.35
+0.57
+10.77
+3.2 Market risk measurement techniques and limits
+BANK OF CHINA LIMITED
+(1) Trading book
+VaR is used to estimate the largest potential loss arising from adverse market movements in
+a specific holding period and within a certain confidence level.
+Low Average
+High
+Low
+The Bank's trading VaR
+Interest rate risk
+17.84
+High
+24.53
+13.45
+17.87
+9.17
+Foreign exchange risk
+32.99
+42.56
+11.24
+Average
+2020
+2021
+VaR is performed separately by the Bank and its major subsidiaries that are exposed to
+market risk, BOCHK (Holdings) and BOCI. The Bank, BOCHK (Holdings) and BOCI used
+a 99% level of confidence (therefore, statistical probability of 1% that actual losses could
+be greater than the VaR estimate) and a historical simulation model to calculate the VaR
+estimate. The holding period of the VaR calculations is one day. To enhance the Group's
+market risk management, the Group has established the market risk data mart, which enabled
+a group level trading book VaR calculation on a daily basis.
+406
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+3 Market risk (Continued)
+3.2 Market risk measurement techniques and limits (Continued)
+(1) Trading book (Continued)
+The accuracy and reliability of the VaR model is verified by daily back-testing of the
+VaR results in the trading book. The back-testing results are regularly reported to senior
+management.
+The Group utilises stress testing as an effective supplement to the trading book VaR
+analysis. Stress testing scenarios are performed based on the characteristics of trading
+transactions to simulate and estimate losses in adverse and exceptional market conditions.
+To address changes in the financial markets, the Group enhances its market risk
+identification capabilities by continuously modifying and improving the trading book stress
+testing scenarios and measurement methodologies in order to capture the potential impact to
+transaction market prices stemming from changes in market prices and volatility.
+The table below shows the VaR of the trading book by type of risk during the years ended
+31 December 2021 and 2020:
+Unit: USD million
+Year ended 31 December
+For the purpose of market risk management in the trading book, the Group monitors trading
+book Value at Risk (VaR) limits, stress testing results and exposure limits and tracks each
+trading desk and dealer's observance of each limit on a daily basis.
+0.17
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(Amount in millions of Renminbi, unless otherwise stated)
+4.01
+2.44
+7.07
+3.95
+trading VaR
+Total BOCHK (Holdings)'s
+6.47
+0.00
+0.23
+0.00
+4.52
+0.90
+Commodity risk
+0.03
+1.44
+2.25
+BOCI's trading VaR (1)
+Equity derivatives unit
+0.21
+Global commodity unit
+0.41
+2.15
+1.10
+0.47
+1.33
+0.72
+Fixed income unit
+0.23
+2.28
+0.94
+0.09
+2.19
+0.57
+0.38
+FOR THE YEAR ENDED 31 DECEMBER 2021
+0.13
+0.44
+Average
+Low
+High
+Average
+2020
+2021
+High
+Year ended 31 December
+BOCHK (Holdings)'s trading
+(1) Trading book (Continued)
+3.2 Market risk measurement techniques and limits (Continued)
+Market risk (Continued)
+3
+VI FINANCIAL RISK MANAGEMENT (Continued)
+Unit: USD million
+Low
+VaR
+Interest rate risk
+0.15
+Equity risk
+0.84
+3.98
+2.72
+1.70
+6.51
+3.24
+Foreign exchange risk
+0.75
+4.58
+2.38
+0.80
+7.42
+2.12
+0.03
+34,077
+453,524
+4,360,353
+556,612
+167,737
+Percentage
+1.07%
+179,384
+1.26%
+Less: total loans and advances to customers which have
+been overdue for less than 3 months
+(44,014)
+Subtotal
+(54,342)
+123,723
+125,042
+(5) Loans and advances three-staging classification
+Loans and advances to customers by five-category loan classification and three-staging
+classification are analysed as follows:
+As at 31 December 2021
+12-month ECLS
+Total loans and advances to customers which
+have been overdue for more than 3 months
+12,269
+4,871
+6,850
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(4) Overdue loans and advances to customers (Continued)
+- Public sectors and quasi-governments
+As at 31 December
+2021
+2020
+Chinese mainland
+155,015
+160,265
+Hong Kong (China), Macao (China) and Taiwan (China)
+Other countries and regions
+7,851
+Lifetime ECLs
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Total
+Stage 2
+255,214
+208,186
+15,671,189
+401
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+15,207,789
+FOR THE YEAR ENDED 31 DECEMBER 2021
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2
+Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(5) Loans and advances three-staging classification (Continued)
+As at 31 December 2020
+(Amount in millions of Renminbi, unless otherwise stated)
+Total
+86,284
+86,284
+Stage 3
+Pass
+15,207,789
+44,401
+15,252,190
+Special-mention
+210,813
+210,813
+Substandard
+61,184
+61,184
+Doubtful
+Loss
+60,718
+60,718
+Stage 1
+12-month ECLS
+BANK OF CHINA LIMITED
+160,265
+3 years over 3 years
+Total
+As at 31 December 2021
+Unsecured loans
+8,585
+11,541
+360 days
+1,936
+23,086
+Guaranteed loans
+2,321
+31,540
+4,319
+741
+1,024
+90 days
+Past due
+361 Days to
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+2 Credit risk (Continued)
+2.5 Loans and advances (Continued)
+(4) Overdue loans and advances to customers (Continued)
+(i) Analysis of overdue loans and advances to customers by collateral type and overdue days
+(Continued)
+Chinese mainland
+Past due
+Past due
+Past due
+up to
+91 to
+38,921
+400
+Collateralised and other secured loans
+25,027
+9,670
+1,239
+24,948
+Collateralised and other secured loans
+37,284
+39,780
+9,299
+26,692
+109,360
+Total
+48,650
+60,864
+41,624
+9,127
+5,604
+4,740
+Guaranteed loans
+25,957
+37,013
+3,589
+93,008
+Total
+38,285
+68,108
+43,268
+5,354
+155,015
+As at 31 December 2020
+Unsecured loans
+6,626
+11,785
+5,262
+2,284
+27,379
+Lifetime ECLS
+(ii) Analysis of overdue loans and advances by geographical area
+Stage 1
+Subtotal
+Total
+17,275
+90,712
+39,222
+147,209
+- Corporate
+148,030
+100,901
+1,052,242
+683,421
+4,855,591
+321,441
+5,860,453
+803,311
+158,740
+47,109
+97,887
+4,808,211
+Issuers in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions
+Governments
+69,390
+562,376
+14,455
+646,221
+- Public sectors and quasi-governments
+47,621
+52,336
+115
+100,072
+― Financial institutions
+13,744
+As at 31 December 2020
+220,540
+Issuers in Chinese mainland
+6,461
+- China Orient
+152,433
+152,433
+Subtotal
+388,801
+3,852,468
+216,751
+163,430
+Issuers in Hong Kong (China), Macao (China),
+Taiwan (China) and other countries and regions
+- Governments
+36,393
+503,881
+16,338
+Total
+39,474
+109,443
+67,834
+3,026,650
+3,033,111
+- Public sectors and quasi-governments
+130,695
+130,695
+― Policy banks
+149
+446,888
+447,037
+- Financial institutions
+31,229
+269,487
+123,956
+424,672
+― Corporate
+Government
+4,052,280
+4,404,699
+Subtotal
+13,642,318
+330,133
+207,273
+14,179,724
+As at 31 December 2021 and 2020, loans and advances by five-category loan classification
+and stage classification did not include loans and advances to customers measured at fair
+value through profit or loss.
+(6) Credit commitments
+Total
+As at 31 December 2021 and 2020, credit risk exposures of credit commitments were mainly
+classified under Stage 1 and categorised as "Pass" in the five-category classifications.
+Banks and other financial institutions comprise those institutions in the Chinese mainland,
+Hong Kong (China), Macao (China), Taiwan (China) and other countries and regions.
+The Group monitors the credit risk of counterparties by collecting and analysing
+counterparty information and establishing credit limits taking into account the nature, size
+and credit rating of counterparties.
+As at 31 December 2021, the majority of the balances of due from and placements with and
+loans to banks and other financial institutions were banks and other financial institutions in
+the Chinese mainland (Note V.13 and Note V.15), the majority of the internal credit ratings
+of these banks and other financial institutions were above A.
+402
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+2.6 Due from and placements with and loans to banks and other financial institutions
+48,332
+48,332
+Loss
+535,391
+Stage 2
+Stage 3
+Pass
+66,181
+13,708,499
+Special-mention
+263,952
+263,952
+Substandard
+125,118
+125,118
+Doubtful
+33,823
+33,823
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+13,642,318
+2
+VI FINANCIAL RISK MANAGEMENT (Continued)
+152,433
+- China Orient
+46,730
+108,844
+113,771
+- Corporate
+505,577
+173,810
+230,803
+100,964
+- Financial institutions
+532,783
+532,783
+― Policy banks
+269,345
+2,195
+Credit risk (Continued)
+164,741
+2.7 Debt securities
+The Group adopted a credit rating approach to manage the credit risk of the debt securities
+by referring to both internal and external credit rating. The carrying amounts (accrued
+interest excluded) of the debt investments analysed by external credit ratings at the financial
+reporting dates are as follows:
+Unrated
+A to AAA Lower than A
+Total
+As at 31 December 2021
+152,433
+- Government
+- Public sectors and quasi-governments
+Issuers in Chinese mainland
+3,183,332
+3,177,655
+162,546
+5,677
+Due to banks and other financial institutions
+Liabilities
+Due to central banks
+181,247
+279,785
+256,822
+246,985
+55,441
+570,038
+509,817
+1,792,329 26,722,408
+14,176
+10,833
+258
+74,115
+6,675
+2,682,739
+1,767,330
+Placements from banks and other financial institutions
+Derivative financial liabilities
+1,493
+71,048
+2,941,491
+548,592
+8,187
+2,978,127
+455,746
+34,226
+1,451,583
+264,056
+4,728
+2,279,615
+2,956,286 2,204,443
+12,532,665
+44,526
+6,067
+955,557
+Total interest repricing gap
+Other
+Bonds issued
+Due to customers
+89,151
+89,151
+407,767
+Total liabilities
+10,253,710
+50,591
+1,023,935 510,635
+1,313,316 1,270,988
+7,553,901
+4,036,896
+Loans and advances to customers, net
+32,521
+69,250
+2,760,256
+7,587,288
+516,235
+254,856
+166,953
+15,322,484
+Financial investments
+financial assets at fair value through profit or loss
+26,362
+financial assets at fair value through other comprehensive income
+financial assets at amortised cost
+161,329
+3,377,039 8,838,410
+203,421
+93,136
+351,443
+380,675
+167,964
+194,892
+561,642
+33,502
+2,389,830
+2,370
+3,213,199
+Financial investments
+Other
+2,244
+1,006,255
+1,008,499
+Total assets
+28,697
+308,986
+42,429
+485,455
+months
+6,508 1,388,678
+5 years
+bearing
+Total
+Cash and due from banks and other financial institutions
+Balances with central banks
+470,557
+92,375
+152,489
+3,117
+84,607
+803,145
+1,883,236
+Placements with and loans to banks and other financial institutions
+405,802
+2,990
+167,138
+years
+489
+278,759
+189,474
+2,076,840
+5,106
+939,320
+Derivative financial assets
+171,738
+171,738
+Loans and advances to customers, net
+3,696,907
+2,476,327 6,603,223
+297,793
+268,035
+506,019 13,848,304
+95,799
+651
+82,515
+18,142,887
+months
+interest
+5,838
+646,030
+705,076
+4,649,173
+3,493,108
+107,867
+1,309,427 24,371,855
+(4,978,764) 1,097,424 4,189,237
+(536,822)
+2,096,576
+482,902 2,350,553
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+1 month
+(Amount in millions of Renminbi, unless otherwise stated)
+FINANCIAL RISK MANAGEMENT (Continued)
+Market risk (Continued)
+3.3 GAP analysis (Continued)
+412
+Assets
+As at 31 December 2020
+Less than
+Between
+1 and 3
+Between
+Between
+Non-
+3 and 12
+1 and 5
+Over
+VI
+95,799
+Due to banks and other financial institutions
+1,257,413
+13,674
+7,714
+2,871,178
+2,596,276
+461,388
+112,493
+1,354,270
+186,305
+15,215
+35,127
+95,255
+34,122
+24,395
+1,528,697
+67,004
+58,677
+329,254
+9,479
+8,521,036
+411,949
+156
+4,940
+62,324
+212,052
+100,330
+887,811
+1,917,003
+91
+6,056
+39,502
+434,833
+117,114
+79,518
+217,441
+271,019
+70,855
+1,351,541
+216,844
+Net liquidity gap
+Total liabilities
+Other
+244,199
+Bonds issued
+16,879,171
+59,291
+Liabilities
+financial assets at fair value through profit or loss
+419
+The tables below present the cash flows of the Group of non-derivative financial assets and
+financial liabilities and derivative financial instruments that will be settled on a net basis
+and on a gross basis by the remaining contractual maturities at the financial reporting date.
+The amounts disclosed in the tables are the contractual undiscounted cash flows, except for
+certain derivatives which are disclosed at fair value (i.e. discounted cash flows basis). The
+Group also manages its inherent short-term liquidity risk based on expected undiscounted
+cash flows.
+4.3 Undiscounted cash flows by contractual maturities
+Liquidity risk (Continued)
+4
+VI FINANCIAL RISK MANAGEMENT (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+2,162,837
+6,930,444
+470,415
+2,895,333
+(143,909)
+(693,580)
+(8,932,662)
+2,036,554
+22,239,822
+157,039
+3,522,899
+3,980,010
+2,078,375
+2,073,345
+10,428,154
+1,244,403
+687,433
+76,113
+95,681
+70,657
+Due to customers
+Derivative financial liabilities
+Placements from banks and other financial institutions
+Between
+Between
+Less than
+1 month
+1 and 3
+months
+3 and 12
+months
+Between
+1 and 5
+years
+Non-
+Over
+5 years
+interest
+bearing
+Total
+Assets
+Cash and due from banks and other financial institutions
+Balances with central banks
+Market risk (Continued)
+370,446
+141,347
+4,187
+61,839
+644,816
+1,994,874
+5,249
+Placements with and loans to banks and other financial institutions
+758,329
+164,425
+582
+283,939
+630
+2,228,726
+47,392
+3,328
+66,997
+411
+The tables below summarise the Group's exposure to interest rate risk. It includes the Group's assets and liabilities at carrying amounts, categorised by
+the earlier of contractual repricing or maturity dates.
+3.3 GAP analysis
+Due to central banks
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+3
+Market risk (Continued)
+3.2 Market risk measurement techniques and limits (Continued)
+(2) Banking book (Continued)
+Sensitivity analysis on net interest income (Continued)
+The table below illustrates the potential impact of a 25 basis points interest rate move on the
+net interest income of the Group. The actual situation may be different from the assumptions
+used and it is possible that actual outcomes could differ from the estimated impact on net
+interest income of the Group.
+(Decrease)/increase in
+net interest income
+As at 31 December
+2021
+2020
+As at 31 December 2021
+FINANCIAL RISK MANAGEMENT (Continued)
+VI
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Derivative financial assets
+BANK OF CHINA LIMITED
+Given the nature of demand deposits, their interest rate fluctuations are less volatile than
+those of other products. Had the impact of yield curves movement on interest expenses
+related to demand deposits been excluded, the net interest income for the next twelve
+months from the reporting date would have increased or decreased by RMB 17,877 million
+(2020: RMB16,716 million) for 25 basis points upward or downward parallel movements,
+respectively.
+4,107
+(4,107)
+(4,351)
+4,351
+- 25 basis points
++25 basis points
+410
+10,968
+227,391
+176,317
+1,318,279
+Bonds issued
+Other
+968,665
+293,844
+218,950
+105,317
+8,617
+267,904
+306,229
+31,980
+3,207
+50,656
+1,896
+72,230
+1,651,454
+477,296
+300
+311
+1,109
+13,984
+15,752
+1,244,403
+687,433
+Total liabilities
+financial assets at fair value through other comprehensive income
+financial assets at amortised cost
+3,053,697
+1,669,018
+428,377
+80,231
+16,879,171
+96,946
+13,003,027
+212,052
+12,918
+13,487
+341
+7,402
+887,811
+Placements from banks and other financial institutions
+137,784
+215,247
+13,729
+28,757
+Due to customers
+12,204
+1,981
+411,949
+Derivative financial liabilities
+139,398
+46,493
+4,474
+947
+874
+9,720
+10,146
+2,247
+756,948
+22,239,822
+Net on-balance sheet position
+Assets available to meet all of the liabilities and to cover outstanding loan commitments
+include "Cash and due from banks and other financial institutions”, “Balances with central
+banks", "Placements with and loans to banks and other financial institutions”, “Loans and
+advances to customers, net", etc. In the normal course of business, a proportion of short-
+term loans contractually repayable will be extended and a portion of short-term customer
+deposits will not be withdrawn upon maturity. The Group would also be able to meet
+unexpected net cash outflows by entering into repurchase transactions, and by selling
+securities and accessing additional funding sources.
+416
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI
+FINANCIAL RISK MANAGEMENT (Continued)
+Liquidity risk (Continued)
+4.2 Maturity analysis
+The Group considers liquidity risk management a significant component of asset-liability
+management, and determines the size, structure and duration of assets and liabilities
+consistent with the principle of overall balance between assets and liabilities. The Group
+establishes its liquidity portfolio to mitigate liquidity risk, and to minimise the gaps in
+the amount and duration between the funding sources and the uses of funds. The Group
+refines its financing strategy, taking into consideration various factors including customer
+risk sensitivity, financing cost and concentration of funding sources. In addition, the Group
+prioritises the development of customer deposits, dynamically adjusts the structure of
+funding sources by market-oriented financing modes, including due to banks and other
+financial institutions, inter-bank borrowings and bond issuance, and improves the diversity
+and stability of financing sources.
+The tables below analyse the Group's assets and liabilities into relevant maturity groupings based on the remaining period at the financial reporting
+date to the contractual maturity date. For purposes of the tables set forth, "Loans and advances to customers, net" are considered overdue only if
+principal payments are overdue. In addition, for loans and advances to customers that are repayable by instalments, only the portion of the loan that is
+actually overdue is reported as overdue. Any part of the loan that is not due is reported according to residual maturity.
+417
+Between
+Between
+Overdue/
+Undated
+On
+demand
+Less than
+1 month
+3 and 12
+months
+1 and 5
+years
+Over
+5 years
+Total
+As at 31 December 2021
+Between
+1 and 3
+months
+The Bank continues to develop and improve its liquidity risk management system with the
+aim of effectively identifying, measuring, monitoring and controlling liquidity risk at the
+institution and group level, including that of branches, subsidiaries and business lines, thus
+ensuring that liquidity demand is met in a timely manner and at a reasonable cost.
+4.1 Liquidity risk management policy and process
+The liquidity risk refers to the risk that a commercial bank fails to acquire adequate funds
+in a timely manner and at a reasonable cost to deal with repayment of debts at maturity,
+perform other payment obligations and meet other fund needs for normal business operation.
+2,255,684
+(269,413)
+(118,102)
+Net off-balance sheet position
+(541,681)
+392,537
+347,658
+Credit commitments
+3,160,861
+761,848
+255,166
+43,443
+(31,366)
+142,505
+107,685
+(107,293)
+10,679
+33,847
+(32,709)
+52,715
+109,693
+(50,662)
+107,899
+2,162,837
+(23,516)
+4,491,673
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+4
+Liquidity risk
+277,062
+Assets
+576,601
+1,917,003
+18,663
+478
+940
+42,085
+939,320
+Derivative financial assets
+97,475
+44,134
+Loans and advances to customers, net
+11,024,110
+22,861
+1,106,377
+738
+258,468
+987
+9,344
+15,581
+171,738
+11,076
+62,829
+375,324
+13,848,304
+Financial investments
+3,479
+1,010,120
+financial assets at fair value through profit or loss
+298,944
+other financial institutions
+GBP
+Other
+Total
+Assets
+Cash and due from banks and other financial institutions
+548,932
+132,751
+20,782
+61,642
+7,101
+555,349
+4,215
+1,500,346
+316,938
+61,418
+81,789
+30,084
+44,252
+27,722
+42,013
+803,145
+2,076,840
+Placements with and loans to banks and
+Balances with central banks
+363,018
+51,870
+82,795
+1,417
+2,346
+244,733
+972,195
+18,410,289
+2,784,284
+1,550,916
+471,820
+187,916
+130,793
+2,466
+866,641
+Total assets
+Liabilities
+Due to banks and other financial institutions
+1,035,286
+539,174
+43,097
+43,770
+14,301
+10,988
+230,387
+24,402,659
+219,734
+183,732
+317,767
+6,476
+316
+23
+51
+504,549
+financial assets at fair value through
+other comprehensive income
+1,280,223
+449,963
+127,357
+financial assets at amortised cost
+2,723,069
+199,575
+2,370
+31,950
+9,628
+130,392
+2,851
+85,054
+6,065
+3,993
+34,078
+2,107,790
+2,978,778
+Other
+Due to central banks
+JPY
+Cash and due from banks and other financial institutions
+Balances with central banks
+269,794
+717,908
+Less than
+1 month
+1 and 3
+months
+3 and 12
+1 and 5
+months
+years
+Over
+5 years
+Total
+Assets
+Cash and due from banks and other financial institutions
+On
+demand
+21
+1,452,254
+286,447
+549,551
+265,996
+39,355
+93,556
+154,008
+3,117
+5,709
+28,669
+1,302
+Placements with and loans to banks and
+Balances with central banks
+other financial institutions
+Undated
+Between
+196,365
+24,371,855
+2,111,462
+(9,586,299)
+(364,383)
+(685,992)
+(300,183)
+3,330,756
+7,845,192
+2,350,553
+Overdue/
+BANK OF CHINA LIMITED
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+418
+VI
+FINANCIAL RISK MANAGEMENT (Continued)
+Liquidity risk (Continued)
+4.2 Maturity analysis (Continued)
+As at 31 December 2020
+Between
+Between
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+377
+Derivative financial assets
+Loans and advances to customers, net
+financial assets at amortised cost
+2,805
+50,431
+80,052
+Other
+356,200
+454,701
+19,792
+17,044
+358,189
+19,930
+284,963
+973,389
+1,443,948
+75,503
+2,107,790
+2,978,778
+972,195
+Total assets
+2,036,554
+1,495,492
+1,379,765
+1,934,466
+4,050,667
+6,418,232
+7,087,483
+24,402,659
+470,772
+1,043,353
+29,025
+217,198
+137,987
+23,481
+46,580
+13,312
+191,481
+397,698
+22,621
+435,364
+154,029
+31,423
+1,288,350
+286,481
+62,752
+2,778,252
+100,735
+31,551
+3,744,008
+803,145
+2,076,840
+939,320
+10,079
+5,364,269
+171,738
+13,848,304
+Financial investments
+- financial assets at fair value through profit or loss
+154,836
+10,521
+47,105
+77,423
+44,679
+169,985
+504,549
+financial assets at fair value through
+other comprehensive income
+3,658,189
+1,488,390
+4,816,153
+1,388,678
+705,076
+27,647
+90,475
+52,874
+169,298
+561,642
+financial assets at fair value through
+other comprehensive income
+24,515
+118,945
+288,848
+26,323
+financial assets at amortised cost
+32,492
+Other
+362,964
+479,476
+24,765
+44,163
+10,745
+369,793
+382,282
+19,233
+Total assets
+2,111,462
+1,713,538
+2,794
+1,763,639
+195,025
+Financial investments
+162,489
+15,952
+66,998
+5,258
+141,348
+4,187
+273
+945
+644,816
+2,228,726
+Placements with and loans to banks and
+other financial institutions
+863
+- financial assets at fair value through profit or loss
+Derivative financial assets
+36,911
+9,765
+236,595
+721,152
+12,558
+648,963
+159,065
+15,998
+968,575
+309,098
+27,189
+3,176,279
+67,235
+24,500
+1,257,413
+4,236,421
+5,789
+6,018,740
+95,799
+15,322,484
+Loans and advances to customers, net
+1,587,297
+4,515,970
+1,057,866
+1,466,314
+78,603
+6,988,945
+2,566
+156
+407,767
+6,235
+9,147,933
+330,167
+11,299,837
+10,648
+1,575,342
+26,122
+45,234
+2,128,022
+13,846
+27,073
+25,003
+6,346
+72,598
+89,151
+2,946,788
+2,993,520
+32,537
+18,142,887
+572,062
+483,716
+69,657
+111,628
+117,853
+87,411
+1,446,767
+237,121
+12,783
+58,425
+274,022
+955,557
+529,863
+1,285,154
+32,713
+2,389,830
+3,213,199
+1,008,499
+8,041,557
+26,722,408
+Liabilities
+Due to banks and other financial institutions
+Due to central banks
+Placements from banks and other financial institutions
+Derivative financial liabilities
+Due to customers
+Bonds issued
+Other
+Total liabilities
+Net liquidity gap
+1,755,054
+60,448
+86,387
+110,267
+256,824
+247,523
+570,040
+515,964
+14,176
+21,355
+258
+2,682,739
+2,273,289
+EURO
+16,154,605
+USD
+8,371
+12,453
+26,820
+1,495,927
+441,169
+37,244
+99,077
+26,565
+83,179
+45,565
+35,395
+644,816
+2,228,726
+other financial institutions
+691,140
+475,833
+24,126
+16,139
+341
+910
+48,924
+1,257,413
+Derivative financial assets
+Placements with and loans to banks and
+46,853
+25,262
+329,908
+413
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI
+FINANCIAL RISK MANAGEMENT (Continued)
+Market risk (Continued)
+3.4 Foreign currency risk (Continued)
+The tables below summarise the Group's exposure to foreign currency exchange rate risk as at 31 December 2021 and 2020. The Group's exposure
+to RMB is provided in the tables below for comparison purposes. Included in the table are the carrying amounts of the assets and liabilities of the
+Group along with off-balance sheet positions and credit commitments in RMB equivalent, categorised by the original currencies. Derivative financial
+instruments are included in the net off-balance sheet position using notional amounts.
+206,607
+414
+RMB
+USD
+HKD
+EURO
+JPY
+GBP
+Other
+Total
+Assets
+Cash and due from banks and other financial institutions
+Balances with central banks
+As at 31 December 2021
+23,782
+2,533
+2,594
+183,066
+29,173
+140,349
+3,842
+89,129
+2,389,830
+financial assets at amortised cost
+2,893,923
+247,294
+12,571
+492,925
+9,631
+3,406
+41,083
+3,213,199
+Other
+311,401
+174,209
+220,831
+2,728
+1,091
+2,188
+5,291
+1,451,346
+other comprehensive income
+- financial assets at fair value through
+3,017
+6,908
+10,112
+95,799
+Loans and advances to customers, net
+12,418,293
+1,219,684
+1,060,054
+213,634
+9,455
+69,951
+331,413
+15,322,484
+Financial investments
+- financial assets at fair value through profit or loss
+431,627
+61,017
+64,443
+3,405
+874
+31
+245
+561,642
+While the table above indicates the effect on profit before income tax and equity of the 1%
+appreciation of USD and HKD, there will be an opposite effect with the same amounts if the
+currencies depreciate by the same percentage.
+296,051
+Effect on other comprehensive income (irrespective of income tax effect).
+2,340
+309,560
+114,713
+428,370
+28,230
+Placements from banks and other financial institutions
+Derivative financial liabilities
+247,076
+102,269
+61,627
+6
+6,938
+971
+Due to central banks
+887,811
+212,052
+212,052
+Due to customers
+9,697,626
+1,333,837
+Bonds issued
+Other
+Total liabilities
+Total interest repricing gap
+75,317
+28,026
+411,949
+201,662
+17,655
+1,917,003
+5,518
+229,352
+48,105
+249,957
+71,072
+76,626
+42,983
+253,926 925,422
+336,105 1,283,662
+Other
+2,698
+169,896
+461,527
+1,019,905
+14,328
+155,971
+504,549
+40,641 2,107,790
+38,682
+955,169
+317,015
+2,978,778
+972,195
+6,875,837
+3,107,964
+7,701,617 2,636,143 1,933,691
+2,147,407
+24,402,659
+Liabilities
+Due to banks and other financial institutions
+1,150,797
+250,707
+192,966
+Total assets
+2,582,012
+450,653
+5,385
+2,817,528
+1,698
+As at
+Effect on equity*
+As at
+As at
+Change in 31 December 31 December 31 December 31 December
+2021
+2020
+Currency
+currency rate
+2021
+As at
+2020
++1%
+424
+450
+726
+620
+HKD
++1%
+(89)
+(181)
+2,289
+USD
+Effect on profit before
+income tax
+The tables below indicate a sensitivity analysis of exchange rate changes of the currencies to
+which the Group had significant exposure. The analysis calculates the effect of a reasonably
+possible movement in the currency rates against RMB, with all other variables held constant,
+on profit before income tax and equity. A negative amount in the table reflects a potential
+net reduction in profit before income tax or equity, while a positive amount reflects a
+potential net increase. Such analysis does not take into account the correlation effect of
+changes in different foreign currencies, any further actions that may have been or could be
+taken by management after the financial reporting date to mitigate the effect of exchange
+differences, nor any consequential changes in the foreign currency positions.
+The Group manages its exposure to currency exchange risk through the management of its
+net foreign currency position and monitors its foreign currency risk on trading books using
+VaR (Note VI.3.2). Meanwhile, the Group performs currency risk sensitivity analysis to
+estimate the effect of potential exchange rate changes of foreign currencies against RMB on
+profit before income tax and equity.
+446,470
+16,879,171
+461,129
+8,566
+49,612
+22,808
+HKD
+1,244,403
+687,433
+11,508,402 2,020,843
+3,721,013 3,320,977
+74,118
+1,594,469 22,239,822
+(4,632,565) 1,087,121 3,980,604
+(684,834) 1,859,573
+552,938 2,162,837
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+3
+Market risk (Continued)
+3.4 Foreign currency risk
+The Group conducts a substantial portion of its business in RMB, with certain transactions
+denominated in USD, HKD and, to a much lesser extent, other currencies. The major
+subsidiary, BOCHK Group, conducts the majority of its business in HKD, RMB and USD.
+The Group endeavours to manage its sources and uses of foreign currencies to minimise
+potential mismatches in accordance with management directives.
+*
+1,008,499
+6,030
+604,993
+20,070,418
+2,350,553
+15,600
+5,221,154
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI
+FINANCIAL RISK MANAGEMENT (Continued)
+Market risk (Continued)
+3.4 Foreign currency risk (Continued)
+415
+As at 31 December 2020
+Total assets
+RMB
+3,835,534
+11,498
+27,425
+18,142,887
+486,088
+89,151
+7,499
+7,286
+77,964
+3,486
+588
+345
+52,564
+(10,169)
+109,439
+49,367
+63,767
+(61,853)
+54,606
+10,876
+1,674
+148,553
+Credit commitments
+264,127
+(214,771)
+161,015
+Net off-balance sheet position
+(32,139)
+332,783
+1,794,474
+Net on-balance sheet position
+24,371,855
+836,778
+119,101
+67,126
+400,900
+1,662,269
+3,009,737
+18,275,944
+Total liabilities
+705,076
+1,388,678
+244,161
+128,228
+(124,423)
+8,275
+304,900
+28,889
+2,191
+820,586
+1,765,005
+205,952
+111,860
+880,695
+36,232
+19,606
+13,329
+86
+5,609
+955,557
+Placements from banks and other financial institutions
+151,620
+220,939
+11,267
+4,987
+2,066
+2,202
+407,767
+Derivative financial liabilities
+Due to customers
+20,620
+48,915
+Bonds issued
+1,311,343
+3,833
+265,626
+2,682,739
+296,457
+14,686
+12,083
+297,041
+Other
+27,625
+14,148,220
+344
+2,433
+2,054
+3,342,520
+1,630,130
+411,776
+1,135,020
+182,868
+889,342
+26,722,408
+Liabilities
+Due to banks and other financial institutions
+Due to central banks
+1,614,433
+34,472
+195,354
+649,129
+48,540
+1,874,449
+8
+38,646
+Total
+5,259,800
+1,194,749
+562,848
+20,597
+As at 31 December 2020
+Loan commitments (¹)
+3,502,203
+18,041
+Subtotal
+5,221,154
+562,840
+1,174,152
+3,484,162
+1,960,220
+234,260
+382,853
+1,343,107
+other financial facilities
+Guarantees, acceptances and
+3,260,934
+328,580
+Capital commitments
+623,766
+307,349
+2,739,612
+Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities,
+including equity securities listed on exchanges or debt instruments issued by certain
+governments and certain exchange-traded derivative contracts.
+Level 2: Valuation technique for which all inputs that have a significant effect on the
+recorded fair value other than quoted prices included within Level 1 are observable for
+the asset or liability, either directly or indirectly. This level includes the majority of the
+over-the-counter ("OTC") derivative contracts, debt securities for which quotations are
+available from pricing service providers, discounted bills, etc.
+Level 3: Valuation technique using inputs which have a significant effect on the
+recorded fair value for the asset or liability are not based on observable market data
+(unobservable inputs). This level includes equity investments and debt instruments
+with significant unobservable components.
+The Group's policy is to recognise transfers between levels of the fair value hierarchy as at
+the end of the reporting period in which they occur.
+The Group uses valuation techniques or counterparty quotations to determine the fair value
+when it is unable to obtain open market quotation in active markets.
+The main parameters used in valuation techniques include bond prices, interest rates, foreign
+exchange rates, equity and stock prices, volatilities, correlations, early repayment rates,
+counterparty credit spreads and others, which are all observable and obtainable from the
+open market.
+423
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+5
+Fair value (Continued)
+5.1 Assets and liabilities measured at fair value (Continued)
+For certain illiquid debt securities (mainly asset-backed securities), unlisted equity (private
+equity) and unlisted funds held by the Group, management obtains valuation quotations
+from counterparties or uses valuation techniques to determine the fair value, including the
+discounted cash flow analysis, net asset value and market comparison approach, etc. The fair
+value of these financial instruments may be based on unobservable inputs which may have a
+significant impact on the valuation of these financial instruments, and therefore, these assets
+and liabilities have been classified by the Group as Level 3. The main unobservable inputs
+and ratio ranges include liquidity discounts 4.00%-45.64%, discount rates 2.55%-13.87%
+and expected dividend RMB0.06 per share-RMB0.84 per share. Management determines
+whether to make necessary adjustments to the fair value for the Group's Level 3 financial
+instruments by assessing the impact of changes in macro-economic factors, valuations by
+external valuation agencies and other inputs, including loss coverage ratios. The Group has
+established internal control procedures to control the Group's exposure to such financial
+instruments.
+424
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+5
+Fair value (Continued)
+5.1 Assets and liabilities measured at fair value (Continued)
+As at 31 December 2021
+Level 1
+Level 2
+Level 3
+•
+241,397
+•
+Assets and liabilities measured at fair value are classified into the following three levels:
+Guarantees, acceptances and
+other financial facilities
+1,183,873
+260,839
+1,752,061
+Subtotal
+3,058,322
+931,115
+502,236 4,491,673
+Capital commitments
+25,717
+27,162
+5
+52,884
+Total
+3,084,039
+958,277
+502,241
+4,544,557
+(1)
+Included within "Loan commitments" are amounts relating to loan commitments and undrawn credit card
+limits. Refer to Note V.40.7.
+422
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+VI FINANCIAL RISK MANAGEMENT (Continued)
+5
+Fair value
+5.1 Assets and liabilities measured at fair value
+•
+(Amount in millions of Renminbi, unless otherwise stated)
+(16,949) (6,971,861)
+2,141,055
+1,373
+42,958
+67,554
+20,881
+As at 31 December 2020
+(785)
+(116)
+(105)
+(122)
+1,092
+Other changes
+4,731
+674
+(12,693)
+Transfers (out)/in of Level 3, net
+(1)
+Settlements
+1,398
+750
+9,043
+14,292
+6,074
+Purchases
+(15)
+(1,467)
+(359)
+20,624
+included in the income statement
+for assets/liabilities held as at
+31 December 2020
+390
+Total gains for the year
+Total
+Total Realised Unrealised
+Realised Unrealised
+2020
+2021
+Year ended 31 December
+year
+Gains or losses on Level 3 assets and liabilities included in the income statement for the
+comprise:
+Total gains or losses for the years ended 31 December 2021 and 2020 included in the
+income statement as well as total gains or losses included in the income statement relating
+to financial instruments held as at 31 December 2021 and 2020 are presented in "Net
+trading gains”, “Net gains on transfers of financial asset” or “Impairment losses on assets"
+depending on the nature or category of the related financial instruments.
+Total gains/(losses) for the year
+5.1 Assets and liabilities measured at fair value (Continued)
+5
+VI FINANCIAL RISK MANAGEMENT (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+427
+(1,427)
+(1,676)
+756
+(844)
+Fair value (Continued)
+Financial assets
+(3,301)
+(1,534)
+Equity
+Debt
+profit or loss
+at fair value through
+(992) (6,957)
+67,900 1,980,710 1,476,508 3,001,639
+(67,840) (1,980,277) (1,478,891) (3,032,559)
+399,425
+(395,345)
+16,953 6,943,135
+Total
+421
+BANK OF CHINA LIMITED
+securities instruments
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+4
+Liquidity risk (Continued)
+4.4 Off-balance sheet items
+The Group's off-balance sheet items are summarised in the table below at the remaining
+period to the contractual maturity date. Financial guarantees are also included below at
+notional amounts and based on the earliest contractual maturity date.
+Less than
+1 year
+Between
+1 and 5
+years
+Over
+5 years
+Total
+As at 31 December 2021
+Loan commitments (1)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(6,515)
+Fund
+investments
+and other
+fair value through other Investment
+comprehensive income
+Sales
+289
+161
+― other comprehensive income
+(1,426)
+(1,598)
+754
+(698)
+122
+-profit/(loss)
+Total gains and losses
+Financial assets at
+20,778
+1,676
+38,936
+71,716
+15,948
+10
+As at 1 January 2020
+and other
+securities
+Debt instruments
+Equity
+properties
+5,275
+Assets measured at fair value
+(31,311)
+2,373
+VI FINANCIAL RISK MANAGEMENT (Continued)
+5
+Fair value (Continued)
+5.1 Assets and liabilities measured at fair value (Continued)
+Reconciliation of Level 3 items
+Derivative
+financial
+assets
+Financial assets
+at fair value through
+profit or loss
+Financial assets at
+(Amount in millions of Renminbi, unless otherwise stated)
+fair value through other Investment
+comprehensive income
+issued at
+properties
+fair value
+Debt
+Equity
+securities instruments
+Fund
+investments
+and other
+Equity
+Debt instruments
+securities
+Bonds
+and other
+FOR THE YEAR ENDED 31 DECEMBER 2021
+BANK OF CHINA LIMITED
+21,428
+Investment properties
+1,441
+20,624
+22,065
+Liabilities measured at fair value
+Due to and placements from banks
+and other financial institutions
+at fair value
+Due to customers at fair value
+Bonds issued at fair value
+Short position in debt securities
+Derivative financial liabilities
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+(3,831)
+(25,742)
+(25,742)
+(6,162)
+(6,162)
+(576)
+(3,539)
+(17,336)
+(17,912)
+(208,513)
+(212,052)
+426
+(3,831)
+4,731
+As at 1 January 2021
+67,554
+8,655
+995
+46,131
+74,300
+26,121
+(1,561)
+(38)
+296
+As at 31 December 2021
+Other changes
+18,314
+(4,200)
+Transfers (out)/in of Level 3, net
+Issues
+Settlements
+479
+3,944
+7,920
+15,029
+5,202
+Purchases
+(1,324)
+3,270
+20,881
+Total gains/(losses) for the year included
+liabilities held as at 31 December 2021
+42,958
+1,373
+4,731
+20,624
+Total gains and losses
+-profit/(loss)
+413
+493
+2,954
+(200)
+in the income statement for assets/
+other comprehensive income
+37
+Sales
+(355)
+(4,576) (7,489)
+(283)
+Derivative
+financial
+assets
+(159)
+2,686
+330
+413
+(57)
+9,692
+7,005
+- Equity instruments and other
+385,049
+1,977,034
+995
+2,363,078
+- Equity instruments and other
+7,774
+10,323
+8,655
+26,752
+Investment properties
+- Debt securities
+1,240
+19,554
+Liabilities measured at fair value
+Due to and placements from banks
+and other financial institutions
+at fair value
+Due to customers at fair value
+Bonds issued at fair value
+(162)
+(31,311)
+(162)
+(315)
+(317)
+18,314
+Short position in debt securities
+Derivative financial liabilities
+other comprehensive income
+102,912
+93,426
+Loans and advances to customers
+at fair value
+355,600
+95,799
+355,600
+Financial assets at fair value
+through profit or loss
+Debt securities
+8,904
+Financial assets at fair value through
+321,437
+356,462
+- Equity instruments
+25,618
+2,350
+74,300
+102,268
+Fund investments and other
+29,208
+27,573
+46,131
+26,121
+(1,945)
+(10,513)
+(12,458)
+Debt securities
+- Equity instruments
+Fund investments and other
+Financial assets at fair value through
+2,960
+323,402
+20,881
+347,243
+7,570
+12,901
+through profit or loss
+67,554
+20,961
+5,362
+42,958
+69,281
+other comprehensive income
+- Debt securities
+296,234
+1,788,755
+1,373
+2,086,362
+88,025
+Financial assets at fair value
+363,637
+171,738
+(1,961)
+(87,190)
+(89,151)
+425
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+5
+Fair value (Continued)
+5.1 Assets and liabilities measured at fair value (Continued)
+As at 31 December 2020
+Level 1
+Level 2
+Level 3
+Total
+Assets measured at fair value
+Derivative financial assets
+3,083
+168,655
+Loans and advances to customers
+at fair value
+363,637
+Derivative financial assets
+3,660
+791,299
+(3,069)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+4
+Liquidity risk (Continued)
+4.3 Undiscounted cash flows by contractual maturities (Continued)
+Non-derivative cash flow
+As at 31 December 2020
+Between
+Between
+Between
+Overdue/
+Undated
+On
+demand
+Less than
+1 month
+1 and 3 3 and 12
+months months
+1 and 5
+Over
+years
+Total
+Cash and due from banks and
+other financial institutions
+BANK OF CHINA LIMITED
+21
+420
+28,969 6,771,452
+265,184
+274,120 58,791
+1,594,013 1,484,679
+26,607
+238,108
+26,363
+5,686
+73.199
+2,581
+210
+408,901
+3,085,322
+3,332,459
+39,180 18,683,706
+590,211
+6,511
+532,098
+31,728
+79,913 1,466,937
+20,892 356,364
+11,228,739 2,121,034
+2,302,652 4,869,125 3,935,650
+140,465 24,597,665
+3,564
+(161) (1,006) (1,913)
+(1,959)
+176
+(1,299)
+159,680 2,441,453 1,426,255 2,339,707
+(159,592) (2,439,349) (1,421,922) (2,337,871)
+375,388
+(373,166)
+(28,726) (6,760,626)
+286,457
+266,397
+93,837
+186,921
+555,499
+-financial assets at fair value through
+other comprehensive income
+-financial assets at amortised cost
+23,454
+140,321
+221,633
+2,848
+54,838
+95,601
+Other financial assets
+478 209,038
+16,621
+3,870
+310,952
+431,641
+7,694
+1,055,733 496,895 2,248,988
+1,686,591 1,254,753 3,526,272
+1,304 15,546 254,551
+Total financial assets
+1,683,044 1,236,713
+1,386,920 1,993,418
+4,577,347
+7,872,714
+9,500,702 28,250,858
+Due to banks and other financial
+72,271
+82,092
+48,200
+11,227
+154,977
+3,288
+Balances with central banks
+1,452,254
+549,550
+39,359
+5,717
+28,717
+1,501
+804,977
+2,077,098
+Placements with and loans to banks and
+9,148,053
+other financial institutions
+397,904
+Loans and advances to customers, net
+48.824
+191,668
+460,253
+157,799 292,606
+1,366,761 3,268,668
+103,768
+952,454
+4,948,258 7,546,587 17,831,019
+Financial investments
+-financial assets at fair value through
+profit or loss
+154,788
+377
+2,701,770
+979,987
+22,088
+530,432
+163,262
+67,535
+143.290
+4,814
+Balances with central banks
+1,488,390
+717,908
+15,954
+5,266
+314
+1,075
+648,695
+2,228,907
+Placements with and loans to banks and
+other financial institutions
+863
+Loans and advances to customers, net
+37,022
+249,018
+728,832 160,886 309,219
+685,412 1,067,915 3,574,376
+67,470
+5,738,229
+1,267,270
+8,802,462 20,154,434
+Financial investments
+269,794
+other financial institutions
+Cash and due from banks and
+Total
+223
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+4
+Liquidity risk (Continued)
+4.3 Undiscounted cash flows by contractual maturities (Continued)
+Non-derivative cash flow
+As at 31 December 2021
+-financial assets at fair value through
+Between
+Between
+Overdue/
+Undated
+On
+Less than
+demand
+1 month
+1 and 3 3 and 12
+months months
+1 and 5
+Over
+years
+5 years
+Between
+institutions
+profit or loss
+26,549
+institutions
+Due to central banks
+Placements from banks and other financial
+institutions
+Due to customers
+Bonds issued
+Other financial liabilities
+Total financial liabilities
+Derivative cash flow
+Derivative financial instruments settled
+on a net basis
+Derivative financial instruments settled
+on a gross basis
+Total inflow
+Total outflow
+1,755,054
+87,253
+261,047
+583,450
+14,696
+270
+60,448
+112,678
+254,341
+Due to banks and other financial
+31,644,393
+11,180,359
+8,798,775
+28,825
+98,009
+81,079
+201,142
+630,676
+-financial assets at fair value through
+other comprehensive income
+-financial assets at amortised cost
+24,516
+2,803
+121,764
+37,819
+59,141
+195,072
+295,793 409,798
+453,319
+10,572
+189,707
+18,298
+2,545
+5,473
+1,182,096
+1,719,551
+4,461
+599,007 2,632,974
+1,557,672 3,830,305
+20,076
+251,132
+Total financial assets
+1,759,238
+1,426,427
+1,797,890 1,687,906 4,993,798
+Other financial assets
+Due to central banks
+5 years
+96,227 22,026,285
+62,781
+5.020
+217
+413,258
+3,055,634
+8,337
+17,102,447
+466,814
+13,519
+244,338 100,902
+1,531,786 1,363,503 2,622,000
+67,194 187,282
+43,428 11,667
+515,009
+1,297,464
+45,160
+26,416
+398,587
+10,348,026 2,037,347
+2,052,528 3,822,856
+3,669,301
+3,588
+61,165
+258,397
+8,521,187
+1,919,027
+895,502
+Placements from banks and other financial
+institutions
+Due to customers
+Bonds issued
+Other financial liabilities
+Total financial liabilities
+Derivative cash flow
+Derivative financial instruments settled
+on a net basis
+Derivative financial instruments settled
+on a gross basis
+Total inflow
+1,351,587
+216,855
+70,933
+79,668
+271,618
+117,556
+218,500
+6,297
+92
+439,242
+42,181
+(468)
+93
+Total outflow
+(7,056)
+Carrying value
+2020
+2021
+As at 31 December
+The tables below summarise the carrying amounts and fair values of “Debt securities at
+amortised cost" and "Bonds issued" not presented at fair value at the financial reporting
+date.
+5.2 Financial assets and liabilities not measured at fair value (Continued)
+Fair value (Continued)
+5
+VI FINANCIAL RISK MANAGEMENT (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+428
+Financial assets and liabilities not presented at fair value in the statement of financial
+position mainly represent “Balances with central banks”, “Due from banks and other
+financial institutions", "Placements with and loans to banks and other financial institutions",
+"Due to central banks”, “Due to banks and other financial institutions", "Loans and
+advances to customers measured at amortised cost", "Financial investments measured at
+amortised cost”, “Placements from banks and other financial institutions at amortised cost",
+"Due to customers at amortised cost” and “Bonds issued at amortised cost".
+5.2 Financial assets and liabilities not measured at fair value
+A 10% increase in all significant unobservable inputs applied in the valuation technique
+would result in an increase in fair value of RMB1,909 million for expected dividend; and a
+decrease in fair value of RMB2,667 million for liquidity discounts and discount rates.
+There were no significant transfers for the financial instruments measured at fair value
+between Level 1 and Level 2 during the year ended 31 December 2021 and the year ended
+31 December 2020.
+(2,846)
+(2,122)
+Fair value Carrying value
+Fair value
+BANK OF CHINA LIMITED
+Debt securities
+429
+Financial assets
+The aggregate fair values are calculated based on quoted market prices. For those bonds where quoted
+market prices are not available, a discounted cash flow model is used based on a current yield curve
+appropriate for the remaining term to maturity.
+Bonds issued
+(2)
+The China Orient Bond and Special Purpose Treasury Bond held by the Bank are non-transferable. As there
+are no observable market prices or yields reflecting arm's length transactions of a comparable size and
+tenor, the fair value is determined based on the stated interest rate of the instruments.
+1,144,440
+1,238,241
+1,395,242
+1,388,361
+Fair values of other debt securities are based on market prices or broker/dealer price quotations. Where this
+information is not available, the Bank will perform valuation by referring to prices from valuation service
+providers or on the basis of discounted cash flow models. Valuation parameters include market interest
+rates, expected future default rates, prepayment rates and market liquidity. The fair values of RMB bonds
+are mainly determined based on the valuation results provided by China Central Depository & Clearing Co.,
+Ltd.
+Debt securities at amortised cost
+(1)
+Bonds issued (2)
+Financial liabilities
+at amortised cost (¹)
+2,989,266
+2,970,277
+3,262,525
+3,206,895
+1,915,551
+1,915,551
+other collateral requirements
+Outflows related to derivative exposures and
+11
+2,027,702
+10
+Additional requirements, of which:
+57,068
+672
+Secured funding
+12
+57,068
+3,276,987
+Outflows related to loss of funding on debt
+15
+13
+6,626,319
+Unsecured debts
+Cash inflows
+16 Total cash outflows
+93,610
+3,206,011
+products
+Other contingent funding obligations
+79,935
+Other contractual funding obligations
+14
+112,151
+1,361,436
+Credit and liquidity facilities
+79,935
+2,349,306
+4,594,486
+Non-operational deposits (all counterparties)
+5.2 Financial assets and liabilities not measured at fair value (Continued)
+17
+Fair value (Continued)
+5
+VI FINANCIAL RISK MANAGEMENT (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+FOR THE YEAR ENDED 31 DECEMBER 2021
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+BANK OF CHINA LIMITED
+Total
+unweighted
+value
+Total
+weighted
+value
+customers, of which:
+8,584,274
+620,119
+3456
+Stable deposits
+78981
+1,397,907
+5,692,939
+from correspondent banking activities)
+Operational deposits (excluding those generated
+3,804,281
+4,436,579
+10,186,586
+395,573
+3,955,726
+Less stable deposits
+4
+224,546
+4,628,548
+5 Unsecured wholesale funding, of which:
+Secured lending (including reverse repos and
+securities borrowing)
+SUPPLEMENTARY INFORMATION
+117,279
+As stipulated by the Rules on Liquidity Risk Management of Commercial Banks issued by
+the CBIRC, the minimum regulatory requirement of NSFR is 100%.
+The Group's net stable funding ratio
+As stipulated by the Disclosure Rules on Net Stable Funding Ratio of Commercial Banks
+issued by the CBIRC, banks approved to implement the advanced approaches of capital
+measurement by the CBIRC in accordance with Capital Rules for Commercial Banks
+(Provisional) shall disclose the information of net stable funding ratio for the preceding two
+consecutive quarters at least semi-annually.
+As at 31 December 2021, the Group's NSFR was 122.21% on a consolidated basis(2),
+representing an increase of 0.88 percentage point over the previous quarter. As at 30
+September 2021, the Group's NSFR was 121.33%, representing an increase of 0.11
+percentage point over the previous quarter. The Group's NSFR remained stable, and met the
+regulatory requirement.
+438
+BANK OF CHINA LIMITED
+The tables below summarise the fair values of three levels of "Debt securities at amortised
+cost" (excluding the China Orient Asset Management Corporation Bond and Special
+Purpose Treasury Bond), and "Bonds issued" not presented at fair value on the statement of
+financial reporting date.
+(Amount in millions of Renminbi, unless otherwise stated)
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+1
+Liquidity ratios, liquidity coverage ratio and net stable funding ratio (Continued)
+The Group's net stable funding ratio (Continued)
+Ending value of NSFR (3)
+(1)
+2021
+As at 31
+December
+As at 30
+September
+2 Retail deposits and deposits from small business
+439
+NSFR are the ending values of each quarter.
+(3)
+When calculating the consolidated NSFR, BOCG Investment, BOC Insurance, BOCG Insurance and BOCG
+Life were excluded from the scope of consolidation in accordance with the requirements of the CBIRC.
+(2)
+Regulatory requirements of net stable funding ratio
+NSFR is introduced to ensure commercial banks have sufficient stable funding to meet the requirements of
+assets and off-balance sheet exposures.
+121.22%
+121.33%
+122.21%
+March
+As at 31
+As at 30
+June
+123.29%
+In accordance with the Disclosure Rules on Net Stable Funding Ratio of Commercial Banks,
+the Group disclosed the information of net stable funding ratio (“NSFR”)(¹) as follows:
+Net stable funding ratio
+The average of LCR and the averages of all related individual items are the day-end simple arithmetic
+averages of figures over each quarter.
+22
+21
+Total adjusted
+3,020,353
+4,146,309
+20 Total cash inflows
+Total HQLA
+2,047,551
+Other cash inflows
+19
+855,523
+1,482,599
+Inflows from fully performing exposures
+18
+2,178,684
+485,026
+22 Total net cash outflows
+437
+When calculating the consolidated LCR, BOCG Investment, BOC Insurance, BOCG Insurance and BOCG
+Life were excluded from the scope of consolidation in accordance with the requirements of the CBIRC.
+The LCR aims to ensure that commercial banks have sufficient HQLA that can be converted into cash to
+meet the liquidity requirements for at least thirty days under stress scenarios determined by the CBIRC.
+(3)
+(2)
+(1)
+The Group's liquidity coverage ratio (Continued)
+23 Liquidity coverage ratio
+1 Liquidity ratios, liquidity coverage ratio and net stable funding ratio (Continued)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+127.61%
+4,594,486
+3,605,966
+value
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+Level 1
+Cash outflows
+Level 3
+9,248
+9,426
+Net capital
+Risk-weighted assets
+2,698,839
+2,451,055
+16,323,713
+15,109,085
+433
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Eligible portion of minority interests
+FOR THE YEAR ENDED 31 DECEMBER 2021
+VI FINANCIAL RISK MANAGEMENT (Continued)
+6
+Capital management (Continued)
+7
+(1) When calculating the capital adequacy ratios, Bank of China Group Investment Limited ("BOCG
+Investment"), Bank of China Insurance Company Limited ("BOC Insurance"), Bank of China Group
+Insurance Company Limited ("BOCG Insurance") and Bank of China Group Life Assurance Company
+Limited ("BOCG Life") were excluded from the scope of consolidation in accordance with the requirements
+of the CBIRC.
+(2)
+This mainly represented exchange differences from the translation of foreign operations and changes in fair
+value on financial assets at fair value through other comprehensive income.
+Insurance risk
+Insurance contracts are mainly sold in the Chinese mainland and Hong Kong (China)
+denominated in RMB and HKD. The risk under any one insurance contract is the possibility
+that the insured event occurs and the uncertainty of the amount of the resulting claim. This
+risk is inherently random and, therefore, unpredictable. The Group manages its portfolio
+of insurance risks through its underwriting strategy and policies, portfolio management
+techniques, adequate reinsurance arrangements and proactive claims handling and
+processing. The underwriting strategy attempts to ensure that the underwritten risks are well
+diversified in terms of type and amount of risk and industry.
+For a portfolio of insurance contracts where the theory of probability is applied to pricing
+and provisioning, the principal risk that the Group faces under its insurance contracts is
+that the actual claims and benefit payments exceed the carrying amount of the insurance
+liabilities. This could occur because the frequency or severity of the claims and benefits are
+greater than those estimated. Insurance events are random and the actual number and amount
+of claims and benefits will vary from year to year from the level established using statistical
+techniques.
+Uncertainty in the estimation of future benefit payments and premium receipts for long-
+term life insurance contracts arises from the unpredictability of long-term changes in overall
+levels of mortality. In order to assess the uncertainty due to the mortality assumption and
+lapse assumption, the Group conducted mortality rate studies and policy lapse studies in
+order to determine the appropriate assumptions.
+(Amount in millions of Renminbi, unless otherwise stated)
+115,627
+128,114
+333,381
+(9,785)
+(9,838)
+Net common equity tier 1 capital
+1,843,886
+1,704,778
+Additional tier 1 capital
+329,845
+287,843
+Preference shares and related premium
+119,550
+147,519
+Additional capital instruments and related premium
+199,955
+129,971
+Eligible portion of minority interests
+10,340
+10,353
+Net tier 1 capital
+2,173,731
+1,992,621
+Tier 2 capital
+525,108
+458,434
+Tier 2 capital instruments issued and related premium
+Excess loan loss provisions
+387,746
+434
+BANK OF CHINA LIMITED
+SUPPLEMENTARY INFORMATION
+(Amount in millions of Renminbi, unless otherwise stated)
+Quarter
+Quarter
+ended 31
+December
+ended 30
+September
+ended 30
+June
+Quarter
+ended 31
+March
+Average value of LCR
+127.61%
+124.62%
+127.51%
+133.30%
+436
+BANK OF CHINA LIMITED
+SUPPLEMENTARY INFORMATION
+(Amount in millions of Renminbi, unless otherwise stated)
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+1 Liquidity ratios, liquidity coverage ratio and net stable funding ratio (Continued)
+The Group's liquidity coverage ratio (Continued)
+The Group's average values (3) of consolidated LCR individual line items in the fourth
+quarter of 2021 are as follows:
+No.
+High-quality liquid assets
+As at 31 December 2021
+Level 2
+1 Total high-quality liquid assets (HQLA)
+2021
+(8)
+The Group's liquidity coverage ratio (Continued)
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+I DIFFERENCES BETWEEN IFRS AND CAS CONSOLIDATED FINANCIAL
+STATEMENTS
+There are no differences in the Group's operating results for the years ended 31 December
+2021 and 2020 or total equity as at 31 December 2021 and 2020 presented in the Group's
+consolidated financial statements prepared under IFRS and those prepared under CAS.
+II UNAUDITED SUPPLEMENTARY INFORMATION
+1
+Liquidity ratios, liquidity coverage ratio and net stable funding ratio
+As at 31 December
+2021
+2020
+RMB current assets to RMB current liabilities
+49.63%
+54.50%
+Foreign currency current assets to foreign
+currency current liabilities
+69.90%
+58.57%
+The liquidity ratios are calculated in accordance with the relevant provisions of the CBIRC.
+Liquidity coverage ratio
+According to the Disclosure Rules on Liquidity Coverage Ratio of Commercial Banks, the
+Group disclosed the information of liquidity coverage ratio ("LCR") (¹) as follows.
+Regulatory requirements of liquidity coverage ratio
+As stipulated by the Rules on Liquidity Risk Management of Commercial Banks issued by
+the CBIRC, the minimum regulatory requirement of LCR is 100%.
+The Group's liquidity coverage ratio
+Since 2017, the Group measured the LCR on a day-to-day consolidated basis (2). In the
+fourth quarter of 2021, the Group measured 92-day LCR on this basis, with average ratio (3)
+standing at 127.61%, representing an increase of 2.99 percentage points over the previous
+quarter, which was primarily due to the decrease in the net cash outflow.
+435
+BANK OF CHINA LIMITED
+SUPPLEMENTARY INFORMATION
+(Amount in millions of Renminbi, unless otherwise stated)
+1 Liquidity ratios, liquidity coverage ratio and net stable funding ratio (Continued)
+(15,140)
+Quarter
+(182)
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+6
+Capital management
+The Group follows the principles below with regard to capital management:
+Adequate capital and sustainable development. Follow the lead of the strategic
+planning of the Group development; and maintain the high quality and adequacy of
+capital so as to meet regulatory requirements, support business growth, and advance the
+sustainable development of the scale, quality and performance of the business in the
+Group.
+Allocation optimisation and benefit augmentation. Allocate capital properly by
+prioritising the asset businesses with low capital occupancy and high comprehensive
+income, and steadily improve the efficiency and return of capital, to achieve the
+reciprocal matchup and dynamic equilibrium among risks, assets and returns.
+Refined management and capital level improvement. Optimise the capital management
+system by sufficiently identifying, calculating, monitoring, mitigating, and controlling
+various types of risks; incorporate capital restraints into the whole process of product
+pricing, resource allocation, structural adjustments, performance evaluation, etc.,
+ensuring that the capital employed is commensurate with the related risks and the level
+of risk management.
+Capital adequacy and regulatory capital are monitored by the Group's management,
+employing techniques based on the guidelines developed by the Basel Committee, as
+implemented by the CBIRC, for supervisory purposes. The required information is filed with
+the CBIRC on a quarterly basis.
+BANK OF CHINA LIMITED
+The Group's capital adequacy ratios are calculated in accordance with the Capital Rules
+for Commercial Banks (Provisional) and other relevant regulations. With the approval of
+the CBIRC, the Group adopts the advanced capital measurement approaches, which include
+Foundation Internal Ratings-based Approach for corporate exposures, Internal Ratings-based
+Approach for retail exposures, Internal Models Approach for market risk and Standardised
+Approach for operational risk. For risk exposures not covered by the advanced approaches,
+the corresponding portion shall be calculated adopting non-advanced approaches.
+431
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+FOR THE YEAR ENDED 31 DECEMBER 2021
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+6
+Capital management (Continued)
+The Group's regulatory capital is managed by its capital management related departments
+and consists of the following:
+•
+•
+As a Systemically Important Bank, the Group's capital adequacy ratios are required to meet
+the lowest requirements of the CBIRC, that is, the common equity tier 1 capital adequacy
+ratio, tier 1 capital adequacy ratio and capital adequacy ratio should be no less than 9.00%,
+10.00% and 12.00%, respectively.
+430
+Other than the above, the difference between the carrying amounts and fair values of those
+financial assets and liabilities not presented at their fair value in the statement of financial
+position as at 31 December 2021 and 2020 was insignificant. Fair value is measured using a
+discounted cash flow model.
+1,144,440
+Total
+Financial assets
+(16,393)
+Debt securities at amortised cost
+99,809
+2,963,747
+3,557
+3,067,113
+Financial liabilities
+Bonds issued
+Level 1
+1,395,242
+As at 31 December 2020
+Level 2
+Level 3
+Total
+Financial assets
+Debt securities at amortised cost
+96,766
+2,694,018
+3,055
+2,793,839
+Financial liabilities
+Bonds issued
+1,144,440
+Common equity tier 1 capital, including common shares, capital reserve, surplus
+reserve, general reserve, undistributed profits, eligible portion of minority interests and
+others;
+Additional tier 1 capital, including additional tier 1 capital instruments issued and
+related premium and eligible portion of minority interests;
+1,395,242
+Goodwill, other intangible assets (excluding land use rights), investments in common equity
+tier 1 capital of financial institutions with controlling interests but outside of the scope of
+regulatory consolidation and other deductible items are deducted from common equity tier 1
+capital to derive at the regulatory capital.
+Undistributed profits
+Capital reserve
+Surplus reserve
+General reserve
+Eligible portion of minority interests
+133,951
+134,221
+212,602
+192,251
+303,084
+267,856
+888,419
+803,823
+33,669
+32,567
+Other(2)
+Of which:
+4,188
+5,295
+(26,415)
+(25,623)
+(182)
+Other intangible assets (excluding land use rights)
+Direct or indirect investments in own shares
+Investments in common equity tier 1 capital of
+financial institutions with controlling interests
+but outside the scope of regulatory consolidation
+Tier 2 capital, including tier 2 capital instruments issued and related premium, excess
+loan loss allowances and eligible portion of minority interests.
+Goodwill
+294,388
+294,388
+Regulatory deductions
+1,730,401
+BANK OF CHINA LIMITED
+NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Common shares
+FOR THE YEAR ENDED 31 DECEMBER 2021
+432
+(Amount in millions of Renminbi, unless otherwise stated)
+VI FINANCIAL RISK MANAGEMENT (Continued)
+Capital management (Continued)
+The table below summarises the Group's common equity tier 1 capital adequacy ratio, tier 1
+capital adequacy ratio and capital adequacy ratio (¹) calculated in accordance with the Capital
+Rules for Commercial Banks (Provisional) and other relevant regulations:
+As at 31 December
+2021
+2020
+Common equity tier 1 capital adequacy ratio
+6
+11.30%
+16.22%
+Composition of the Group's capital base
+Capital adequacy ratio
+13.19%
+16.53%
+1,870,301
+Tier 1 capital adequacy ratio
+11.28%
+13.32%
+Common equity tier 1 capital
+18,000
+Other capital instruments
+3
+Capital
+2,472,030
+2,472,030
+Regulatory capital
+2
+1
+2,490,030
+Unweighted value
+value
+≥1 year
+Weighted
+18,000
+6-12
+months
+No
+maturity <6 months
+2,490,030
+4
+14,440
+small business customers
+7
+4,053,103
+Wholesale funding
+Available Stable Funding (ASF) Item
+10,699
+38,664
+2,292,425 2,160,471
+Less stable deposits
+6
+4,403,127
+6,746
+2,655,335
+1,957,994
+Stable deposits
+5
+8,456,230
+17,445
+53,104
+4,250,419 4,815,806
+Retail deposits and deposits from
+No. Items
+370
+The Group's net stable funding ratio (Continued)
+NSFR
+34
+Total RSF
+Off-balance sheet items
+333
+above categories
+All other assets not included in the
+31
+additional requirements
+NSFR derivatives liabilities with
+30
+29 NSFR derivatives assets
+22
+to default funds of CCPs
+derivative contracts and contributions
+Assets posted as initial margin for
+5,860,537 6,398,752
+28
+243,004
+435
+The Group's consolidated NSFR individual line items at the end of the third quarter of 2021
+are as follows:
+103,898
+19,416*
+Liquidity ratios, liquidity coverage ratio and net stable funding ratio (Continued)
+1
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+441
+Reported derivative liabilities are before deducting variation margin posted. There is no need to
+differentiate by maturities. The unweighted value should be excluded from the total value of item No.26
+"Other assets".
+*
+122.21%
+14,290,402
+302,271
+7,419,366
+988,495
+423,014
+19,076
+100,861
+466,266
+19,416
+6,817
+911,926
+Loans to financial institutions secured
+5,786,066
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+442
+432,043
+66,470
+1,312,245 323,510
+46,539
+by non-Level 1 assets and unsecured
+loans to financial institutions
+(Amount in millions of Renminbi, unless otherwise stated)
+Loans to financial institutions secured
+41,757
+417,569
+by Level 1 assets
+18
+10,429,932 11,765,087
+2,254,618
+94,226
+1,979
+5,112,083
+19
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+1
+Liquidity ratios, liquidity coverage ratio and net stable funding ratio (Continued)
+6,708,858
+285,887
+1,679,453 5,273,588
+3,010,264
+of which:
+public sector entities (PSES)
+sovereigns, central banks and
+customers, non-financial institutions,
+Weighted
+value
+≥1 year
+6-12
+months
+No
+maturity <6 months
+Unweighted value
+Loans to retail and small business
+20
+Required Stable Funding (RSF) Item (Continued)
+No. Items
+The Group's consolidated NSFR individual line items at the end of the third quarter of 2021
+are as follows (Continued):
+The Group's net stable funding ratio (Continued)
+46,539
+Loans and securities
+17
+186,473
+206,180
+56,128
+Other liabilities
+11
+interdependent assets
+Liabilities with matching
+10
+3,024,878
+498,314
+911,926
+6,290,418
+446,495
+Other wholesale funding
+9
+2,761,188
+108,334
+5,414,042
+Operational deposits
+8
+4,479
+498,314
+405,356
+12
+institutions for operational purposes
+Deposits held at other financial
+16
+675,604
+Total NSFR high-quality liquid assets
+15
+Required Stable Funding (RSF) Item
+309,724
+17,042,050
+Total ASF
+14
+307,485
+4,479
+206,180
+56,128
+included in the above categories
+All other liabilities and equity not
+13
+97,871
+NSFR derivatives liabilities
+309,724
+including gold
+Other liabilities
+27
+462,606 3,056,657
+1,020,579
+2,934,664
+172,982
+6,014,818
+487,119
+Other wholesale funding
+9
+5,696,346
+10
+Operational deposits
+5,991,321
+462,606
+1,020,579
+6,183,465 6,187,800
+Wholesale funding
+7
+3,952,177
+3,940
+8
+Liabilities with matching
+interdependent assets
+11
+15
+Required Stable Funding (RSF) Item
+313,011
+17,463,911
+Total ASF
+14
+310,815
+4,392
+219,383
+68,499
+included in the above categories
+All other liabilities and equity not
+13
+313,011
+407,896
+97,081
+NSFR derivatives liabilities
+12
+4,392
+219,383
+68,499
+40,030
+2,191,830 2,155,070
+Less stable deposits
+6
+2,604,093
+Weighted
+value
+≥1 year
+6-12
+months
+No
+maturity <6 months
+Capital
+Available Stable Funding (ASF) Item
+No. Items
+1
+Unweighted value
+The Group's consolidated NSFR individual line items at the end of the fourth quarter of
+2021 are as follows:
+The Group's net stable funding ratio (Continued)
+Liquidity ratios, liquidity coverage ratio and net stable funding ratio (Continued)
+1
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+21
+2,604,093
+Total NSFR high-quality liquid assets
+2
+2,586,093
+4,603,309
+2,516
+13,439
+2,142,470 2,687,031
+Stable deposits
+5
+8,555,486
+6,456
+53,469
+4,842,101
+4,334,300
+small business customers
+Retail deposits and deposits from
+4
+18,000
+18,000
+Other capital instruments
+3
+2,586,093
+Regulatory capital
+Physical traded commodities,
+759,186
+Deposits held at other financial
+equal to 35%
+With a risk weight of less than or
+47,673
+3,948,278
+4,597,223
+98,971
+98,499
+Residential mortgages of which:
+22
+6,657
+23
+31,881
+24,550
+219,860
+equal to 35%
+With a risk weight of less than or
+21
+6,763,085
+5,363,951
+22
+6,810
+290,479
+195,545
+1,258,102
+527,347
+19,076
+100,861
+752,153
+Other assets
+26
+225
+liabilities
+Assets with matching interdependent
+25
+552,395 706,031
+122,124
+349,019
+exchange-traded equities
+do not qualify as HQLA, including
+Securities that are not in default and
+24
+24
+1,702,685
+2,911,282
+of which:
+public sector entities (PSES)
+1,433,122
+75,073
+by non-Level 1 assets and unsecured
+loans to financial institutions
+Loans to financial institutions secured
+19
+29,301
+293,010
+by Level 1 assets
+Loans to financial institutions secured
+18
+76,285
+11,894,558
+10,582,731
+2,228,720
+4,705
+5,084,932
+75,073
+Loans and securities
+17
+147,865
+institutions for operational purposes
+304,940
+16
+69,162
+440
+Weighted
+value
+≥1 year
+6-12
+months
+No
+maturity <6 months
+Unweighted value
+sovereigns, central banks and
+customers, non-financial institutions,
+Loans to retail and small business
+20
+Required Stable Funding (RSF) Item (Continued)
+No. Items
+The Group's consolidated NSFR individual line items at the end of the fourth quarter of
+2021 are as follows: (Continued):
+The Group's net stable funding ratio (Continued)
+Liquidity ratios, liquidity coverage ratio and net stable funding ratio (Continued)
+1
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+447,863
+With a risk weight of less than or
+2
+234,243
+5
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+The total amount of overdue "Placements with and loans to banks and other financial
+institutions" as at 31 December 2021 and 2020 is not considered material.
+4.2 Total amount of overdue Placements with and loans to banks and other financial
+institutions
+1.26%
+1.07%
+Total
+0.38%
+0.33%
+over 12 months
+0.33%
+0.33%
+between 6 and 12 months
+0.17%
+0.13%
+between 3 and 6 months
+Leverage ratio
+0.38%
+The leverage ratios of the Group calculated in accordance with the Administrative
+Measures for the Leverage Ratio of Commercial Banks (Revised) and the Capital Rules for
+Commercial Banks (Provisional) are as follows(¹):
+As at
+No. Items
+7.37%
+7.39%
+7.59%
+7.65%
+Leverage ratio
+27,344,497
+off-balance sheet assets 28,425,377 27,820,891 27,861,068
+2,014,251
+2,058,220
+2,111,813
+2,173,731
+Adjusted on- and
+Net tier 1 capital
+As at
+31 March
+30 June
+31 December 30 September
+As at
+As at
+2021
+34567
+0.28%
+179,384
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+446
+700,035 2,019,606 3,815,546
+1,095,905
+Total
+233,162 173,112 487,586
+63,838 283,718 549,096
+81,312
+201,540
+North and South America
+Europe and other
+1,562,776 2,778,864
+403,035
+813,053
+Subtotal
+681,274
+417,733
+483,287
+442,402
+4 Overdue assets
+within 3 months
+For the purpose of the table below, the entire outstanding balance of "Loans and advances
+to customers" and "Placements with and loans to banks and other financial institutions" are
+considered overdue if either principal or interest payment is overdue.
+As at 31 December
+167,737
+Percentage
+Total
+over 12 months
+53,944
+52,432
+47,097
+50,993
+between 6 and 12 months
+24,001
+20,298
+between 3 and 6 months
+54,342
+44,014
+within 3 months
+which have been overdue
+Total loans and advances to customers
+2020
+2021
+4.1 Total amount of overdue loans and advances to customers
+702,641 1,614,303
+1 Total consolidated assets
+Adjustments for derivative financial instruments
+Adjustments for securities financing transactions
+Adjustments for off-balance sheet exposures
+Other adjustments
+16
+Agent transaction exposures
+15
+153,703
+assets
+Counterparty credit risk exposure for securities financing transaction
+14
+Less: Deducted amounts for securities financing transaction assets
+13
+504,490
+Accounting balance for securities financing transaction assets
+12
+229,237
+Total derivative exposures
+11
+82
+(8)
+Less: Exempted CCP leg of client-cleared trade exposures
+Adjusted effective notional amount of written credit derivatives
+Less: Deductible amounts for written credit derivatives
+10
+9
+Balance of assets in securities financing transactions
+8
+658,193
+Off-balance sheet items
+449
+(1) When calculating the consolidated leverage ratio, BOCG Investment, BOC Insurance, BOCG Insurance
+and BOCG Life were excluded from the scope of consolidation in accordance with the Capital Rules for
+Commercial Banks (Provisional).
+7.65%
+Leverage ratio
+22
+22
+28,425,377
+Adjusted on- and off-balance sheet exposures
+2,173,731
+Net tier 1 capital
+1,889,881
+Adjusted off-balance sheet exposures
+122
+20
+19
+(3,815,914)
+Less: Adjustments for conversion to credit equivalent amounts
+18
+5,705,795
+17
+Adjustments that are consolidated for accounting purposes
+but outside the scope of regulatory consolidation
+Adjustments for fiduciary assets
+provided in derivative transactions
+7
+equal to 35%
+No. Items
+5 Leverage ratio (Continued)
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+448
+28,425,377
+8 Adjusted on- and off-balance sheet assets
+(26,415)
+1,889,881
+153,703
+133,390
+(447,590)
+26,722,408
+2021
+31 December
+As at
+As at
+Less: Deductions of receivable assets for cash variation margin
+31 December
+1
+from the balance sheet assets
+Gross-up for derivative collateral provided where deducted
+6
+133,316
+with all derivative transactions
+Add-on amounts for potential future exposure associated
+5
+95,847
+(i.e. net of eligible cash variation margin)
+Replacement cost associated with all derivative transactions
+4
+25,648,066
+(excluding derivatives and SFTs)
+Total on-balance sheet exposures
+25,674,481
+(26,415)
+Less: Tier 1 capital deductions
+2
+securities financing transactions (SFTs))
+On-balance sheet assets (excluding derivatives and
+2021
+236,529
+214
+166,292
+447
+Other Asia Pacific locations
+(364)
+(19,306)
+Net options position*
+760,105 1,313,088 7,018,076
+(420,572) (1,536,300) (6,502,912)
+(4,546,040)
+4,944,883
+Forward purchases
+3,695,294 1,607,291 1,945,381 7,247,966
+(4,029,848) (1,964,590) (1,736,612) (7,731,050)
+Spot liabilities
+Spot assets
+(6,615) (26,285)
+As at 31 December 2020
+72,622 228,897
+Structural position
+9,928
+(8,929) (23,581)
+42,438
+Net long/(short) position
+(1,373)
+(2,194)
+(32)
+853
+87,567 389,086
+Net options position*
+Net long/(short) position
+(18,130) (21,058)
+Physical traded commodities,
+including gold
+249,356
+211,952
+28
+Assets posted as initial margin for
+International claims
+3
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+44,983
+SUPPLEMENTARY INFORMATION
+444
+The net option position is calculated in accordance with the relevant provisions of the CBIRC.
+*
+375,844
+79,913
+233,953
+61,978
+Structural position
+5,795
+derivative contracts and contributions
+BANK OF CHINA LIMITED
+27
+4,217,661 1,693,178 1,954,742 7,865,581
+(3,957,140) (1,956,893) (1,781,566) (7,695,599)
+740,015 1,322,061 6,494,032
+(485,197) (1,516,624) (6,652,713)
+Forward sales
+All other assets not included in the
+333
+above categories
+Off-balance sheet items
+Total RSF
+34 NSFR
+387
+329
+103,514
+5,643
+31
+19,574*
+471,291
+59,432
+6,582
+476,129
+988,708
+7,024,290
+285,014
+14,046,137
+97,249
+121.33%
+19,574
+(4,650,892)
+additional requirements
+30
+4,431,956
+Forward purchases
+Spot liabilities
+Spot assets
+As at 31 December 2021
+Total
+Other
+HKD
+USD
+Equivalent in millions of RMB
+NSFR derivatives liabilities with
+The following information is computed in accordance with the provisions of the CBIRC.
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+443
+Reported derivative liabilities are before deducting variation margin posted. There is no need to
+differentiate by maturities. The unweighted value should be excluded from the total value of item No.26
+"Other assets".
+*
+to default funds of CCPs
+2225
+29 NSFR derivatives assets
+Currency concentrations
+1,226,206
+Forward sales
+6,582
+North and South America
+Europe and other
+442,324 1,603,965 3,166,821
+1,120,532
+Subtotal
+541,894
+713,249
+1,911,678
+256,068 729,546
+4,889 460,784
+181,367 413,635
+76,221
+118,247
+Other Asia Pacific locations
+Hong Kong (China)
+926,064
+Chinese mainland
+Asia Pacific
+As at 31 December 2021
+Total
+Non-bank
+Official private
+sector
+sector
+Banks
+International claims have been disclosed by major countries or geographical areas. A
+country or geographical area is reported where it constitutes 10% or more of the aggregate
+amount of international claims, after taking into account any risk transfers.
+116,742 240,651 278,585
+238,323 86,339 303,990
+635,978
+628,652
+Total
+1,475,597
+40,671
+Hong Kong (China)
+675,133
+Chinese mainland
+Asia Pacific
+As at 31 December 2020
+Total
+sector
+sector
+International claims include “Balances with central banks”, “Due from and placements
+with and loans to banks and other financial institutions”, “Government certificates of
+indebtedness for bank notes issued", "Loans and advances to customers” and “Financial
+investments", etc.
+Banks
+Official
+International claims (Continued)
+3
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+580,030
+445
+769,314 2,186,540 4,431,451
+Non-bank
+private
+The Group discloses international claims according to Banking (Disclosure) Rules (L.N.
+160 of 2014). International claims are risk exposures generated from the countries or
+geographical areas where the counterparties take the ultimate risk while considering the
+transfer of the risk, exclude local claims on local residents in local currency. Risk transfer is
+only made if the claims are guaranteed by a party in a country which is different from that
+of the counterparty or if the claims are on an overseas branch of a counterparty whose head
+office is located in another country.
+BANK OF CHINA LIMITED
+284,333
+22
+22
+Residential mortgages of which:
+97,853
+98,102
+4,508,548
+43,027
+3,873,376
+With a risk weight of less than or
+equal to 35%
+6,668
+6,734
+23
+26
+24
+Securities that are not in default and
+do not qualify as HQLA, including
+exchange-traded equities
+274,152
+153,553
+581,326
+709,053
+25
+Assets with matching interdependent
+191,518
+liabilities
+24,249
+Other assets
+720,647
+28,312
+59,432
+225
+GUANGXI ZHUANG
+AUTONOMOUS REGION,
+TEL: (86) 025-84207888
+FAX: (86) 025-84200407
+POST CODE: 210005
+ZHEJIANG BRANCH
+321 FENG QI ROAD,
+HANGZHOU,
+ZHEJIANG PROV.,
+CHINA
+SWIFT: BKCHCNBJ910
+TEL: (86) 0571-85011888
+FAX: (86) 0571-87074837
+POST CODE: 310003
+457
+ANHUI BRANCH
+SWIFT: BKCHCNBJ480
+TEL: (86) 0771-2879602
+FAX: (86) 0771-2813844
+POST CODE: 530022
+HENAN BRANCH
+GUANGXI BRANCH
+NO. 1688, YUNGU ROAD,
+BINHU NEW DISTRICT,
+CHINA
+ANHUI PROV.,
+CHINA
+SWIFT: BKCHCNBJ780
+TEL: (86) 0551-62926995
+FAX: (86) 0551-62926993
+POST CODE: 230091
+3-1 BUSINESS OUTER RING ROAD,
+ZHENGDONG NEW DISTRICT,
+ZHENGZHOU,
+HENAN PROV.,
+CHINA
+SWIFT: BKCHCNBJ530
+TEL: (86) 0371-87008888
+FAX: (86) 0371-87007888
+POST CODE: 450018
+39 GUCHENG ROAD,
+NANNING,
+HEFEI,
+INNER MONGOLIA BRANCH
+FUJIAN BRANCH
+22 LUOYUAN STREET,
+JINAN,
+SHANDONG BRANCH
+SWIFT: BKCHCNBJ550
+TEL: (86) 0791-86471503
+FAX: (86) 0791-86471505
+POST CODE: 330038
+CHINA
+JIANGXI PROV.,
+NANCHANG,
+HONGGUTAN NEW DISTRICT,
+10, LVYIN ROAD,
+JIANGXI BRANCH
+SWIFT: BKCHCNBJ740
+TEL: (86) 0898-66778001
+FAX: (86) 0898-66562040
+POST CODE: 570102
+HAINAN PROV.,
+CHINA
+29, 31 DATONG ROAD,
+LONGHUA DISTRICT,
+HAIKOU,
+HAINAN BRANCH
+SWIFT: BKCHCNBJ600
+TEL: (86) 027-85569726
+FAX: (86) 027-85562955
+POST CODE: 430022
+HUBEI PROV.,
+CHINA
+219 XINHUA ROAD,
+JIANGHAN DISTRICT,
+WUHAN,
+HUBEI BRANCH
+SWIFT: BKCHCNBJ720
+TEL: (86) 0591-87090999
+FAX: (86) 0591-87090111
+POST CODE: 350003
+CHINA
+FUJIAN PROV.,
+BOC BLDG., 136 WUSI ROAD,
+FUZHOU,
+SWIFT: BKCHCNBJ940
+CHINA
+CHINA
+148 ZHONG SHAN NAN LU,
+NANJING,
+12 XINHUA DAJIE,
+TIANJIN BRANCH
+FAX: (86) 010-85121739
+POST CODE: 100010
+TEL: (86) 010-85121491
+SWIFT: BKCHCNBJ110
+CHINA
+BEIJING,
+DONGCHENG DISTRICT,
+2 CHAOYANGMEN NEI DAJIE,
+A, C, E KAIHENG CENTER,
+SHANXI BRANCH
+186 PINGYANG ROAD,
+XIAODIAN DISTRICT,
+TAIYUAN,
+SHANXI PROV.,
+CHINA
+SWIFT: BKCHCNBJ680
+TEL: (86) 0351-8266016
+FAX: (86) 0351-8266021
+POST CODE: 030006
+HEILONGJIANG BRANCH
+19 HONGJUN STREET,
+NANGANG DISTRICT,
+HARBIN,
+HEILONGJIANG PROV.,
+CHINA
+SWIFT: BKCHCNBJ860
+TEL: (86) 0451-53636890
+FAX: (86) 0451-53624147
+POST CODE: 150001
+BEIJING BRANCH
+XIN CHENG DISTRICT,
+HUHHOT,
+INNER MONGOLIA
+AUTONOMOUS REGION,
+SHANDONG PROV.,
+CHINA
+JIANGSU BRANCH
+SWIFT: BKCHCNBJ840
+TEL: (86) 0431-88408888
+FAX: (86) 0431-88408901
+POST CODE: 130061
+699 XI AN DA LU,
+CHANGCHUN,
+JILIN PROV.,
+CHINA
+JILIN BRANCH
+SWIFT: BKCHCNBJ810
+TEL: (86) 024-22810916
+FAX: (86) 024-22857333
+POST CODE: 110013
+253 SHIFU ROAD,
+SHENHE DISTRICT,
+SHENYANG,
+LIAONING PROV.,
+CHINA
+LIAONING BRANCH
+SWIFT: BKCHCNBJ220
+TEL: (86) 0311-69696681
+FAX: (86) 0311-69696692
+POST CODE: 050000
+28 ZIQIANG ROAD,
+SHIJIAZHUANG,
+HEBEI PROV.,
+CHINA
+JIANGSU PROV.,
+HEBEI BRANCH
+SHANGHAI BRANCH
+TIANJIN,
+8 YOUYI NORTH ROAD,
+HEXI DISTRICT,
+TEL: (86) 021-50375566
+FAX: (86) 021-50372911
+POST CODE: 200120
+SWIFT: BKCHCNBJ300
+CHINA
+200 MID. YINCHENG ROAD,
+PUDONG NEW DISTRICT,
+SHANGHAI,
+SWIFT: BKCHCNBJ880
+TEL: (86) 0471-4690128
+FAX: (86) 0471-4690001
+POST CODE: 010010
+CHINA
+SWIFT: BKCHCNBJ200
+TEL: (86) 022-27108002
+FAX: (86) 022-23312805
+POST CODE: 300204
+SWIFT: BKCHCNBJ500
+TEL: (86) 0531-58522001
+FAX: (86) 0531-58522000
+POST CODE: 250000
+Valley
+593 MID. FURONG ROAD
+(1 DUAN),
+CHANGSHA,
+2020
+No. Indicators (1)
+The Group calculated the domestic systemic importance assessment indicators pursuant to
+the Notice on Filling in Data for Evaluating Systemically Important Banks and by referring
+to the Evaluation Measures for Systemically Important Banks (Yin Fa [2020] No. 289). The
+indicators are disclosed as follows:
+7 Domestic Systemic Importance Assessment Indicators of Commercial Banks for 2020
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+1
+BANK OF CHINA LIMITED
+The indicators above are calculated and disclosed in accordance with the Guidelines for the Disclosure
+of Global Systemic Importance Assessment Indicators of Commercial Banks, which are unaudited and
+prepared on a different basis compared with the financial and regulatory scope of consolidation.
+3,801,847
+4,415,941
+(1)
+14 Cross-jurisdictional liabilities
+Cross-jurisdictional claims
+93,107
+450
+1,086,588
+Adjusted on-balance and off-balance sheet assets
+2
+3,784,824
+Agency and commission business
+9,847,839
+Assets under custody
+618,018,673
+Payments settled via payment systems or correspondent banks
+5
+25,370,714
+1,711,262
+4
+2,885,960
+TEL: (86) 010-66596688
+FAX: (86) 010-66016871
+POST CODE: 100818
+WEBSITE: www.boc.cn
+Intra-financial system liabilities
+3
+2,853,180
+Intra-financial system assets
+Securities and other financing instruments
+10,888,369
+1,140,731
+3,141,591
+6
+5
+Payments settled via payment systems or correspondent banks
+4 Securities and other financing instruments
+3
+Intra-financial system liabilities
+Intra-financial system assets
+Assets under custody
+Adjusted on-balance and off-balance sheet assets
+No. Indicators (¹)
+The Group calculated the global systemically important banks assessment indicators by
+using the Notice on Issuing the Guidelines for the Disclosure of the Indicators for Assessing
+Global Systemic Importance of Commercial Banks (Yin jian fa, [2014] No.1) as a reference
+basis, and based on the Instructions for G-SIB assessment exercise by the Basel Committee
+on Banking Supervision. The indicators are disclosed as follows:
+6 Global Systemic Importance Assessment Indicators of Commercial Banks
+II UNAUDITED SUPPLEMENTARY INFORMATION (CONTINUED)
+(Amount in millions of Renminbi, unless otherwise stated)
+SUPPLEMENTARY INFORMATION
+BANK OF CHINA LIMITED
+12
+7
+Underwritten transactions in debt and equity markets
+8
+2,174,703
+11,777,333
+665,682,257
+4,449,968
+2,983,029
+2,372,647
+28,521,651
+2021
+13
+Level 3 assets
+12
+Trading and available for sale securities
+11
+10 Notional amount of over-the-counter derivatives
+Trading volume of equities and other securities
+9
+Trading volume of fixed income
+8
+Number of corporate customers (Unit: ten thousand)
+451
+9
+QINGHAI BRANCH
+218 DONGGUAN STREET,
+CHENG DONG DISTRICT,
+XINING,
+QINGHAI PROV.,
+CHINA
+TEL: (86) 0871-63191216
+||
+International Finance
+SWIFT: BKCHCNBJ640
+Labor Union Office
+Shanghai College of
+International Finance
+Retired Staff Office
+11
+L
+Logistics Office
+Institutions
+||
+YUNNAN PROV.,
+CHINA
+515 BEIJING ROAD,
+KUNMING,
+YUNNAN BRANCH
+HUNAN PROV.,
+CHINA
+SWIFT: BKCHCNBJ970
+TEL: (86) 0731-82580703
+FAX: (86) 0731-82580707
+POST CODE: 410005
+GUANGDONG BRANCH
+1-19TH FLOOR NO. 197 &
+1-11TH FLOOR, 14-19TH FLOOR
+NO. 199 DONGFENG XI ROAD
+YUEXIU DISTRICT,
+GUANGZHOU,
+GUANGDONG PROV.,
+CHINA
+SWIFT: BKCHCNBJ400
+TEL: (86) 020-83338080
+FAX: (86) 020-83344066
+POST CODE: 510180
+SICHUAN BRANCH
+35 MID. RENMIN ROAD
+(2 DUAN),
+CHENGDU,
+SICHUAN PROV.,
+CHINA
+SWIFT: BKCHCNBJ570
+TEL: (86) 028-86741950
+FAX: (86) 028-86403346
+POST CODE: 610031
+GUIZHOU BRANCH
+BOC BLDG., 347 RUIJIN
+SOUTH ROAD,
+GUIYANG,
+GUIZHOU PROV.,
+CHINA
+SWIFT: BKCHCNBJ240
+TEL: (86) 0851-85822419
+FAX: (86) 0851-85863981
+POST CODE: 550002
+458
+Tier-one and direct
+branches, tier-two
+branches and
+sub-branches
+HUNAN BRANCH
+BOC Fullerton
+BOC Wealth Management
+Institutions Department
+Financial Institutions
+Department
+Global Transaction
+Banking Department
+SME Services Department
+(Rural Revitalisation
+Finance Department)
+Digital Personal Banking
+Department
+Consumer Finance
+Department
+Global Markets
+Department
+Investment Banking and
+Asset Management
+Department
+Custody Services
+Department
+Risk Management
+Department
+Credit Approval
+Department
+Credit Management
+Department
+Internal Control and
+Legal & Compliance
+Department
+Distribution and Operation
+Management Department
+Information Technology
+Department
+Office of Enterprise-level
+Architecture Development
+Clearing
+Department
+Corporate Banking
+Department
+Administrative
+China
+Head Office Departments
+11
+10,489
+Number of domestic operating institutions (Unit: one)
+10
+32,742
+Number of personal customers (Unit: ten thousand)
+Office of Leading
+Group for Conducting
+Inspection
+Financial Management
+Department
+Asset & Liability
+Management Department
+Digital Asset
+Management Department
+Equity Investment and
+Subsidiary Management
+Department
+Education & Development
+Department
+Office of the Leading
+Group for Comprehensively
+Deepening Reform
+BOC Insurance
+BOCHK
+BOC-Samsung Life
+Hong Kong Branch
+BOCG Investment
+BOCIM
+Macau Branch
+BOCG Insurance
+Tai Fung Bank Limited
+BOC Life
+BOC Aviation
+Shanghai RMB
+Trading Unit
+Executive Office
+Human Resources
+Department
+Globalisation Office
+Community Bank
+SWIFT: BKCHCNBJ
+Bloomberg
+BEIJING,
+Investor Relations Team, Board Secretariat, Bank of China Limited
+8/F, Bank of China Building, No. 1 Fuxingmen Nei Dajie, Xicheng District, Beijing, China
+Telephone: (86) 10-6659 2638
+Facsimile: (86) 10-6659 4568
+E-mail: ir@bankofchina.com
+Other Information
+You may write to the Bank's H-Share Registrar, Computershare Hong Kong Investor Services
+Limited (address: 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong,
+China) to request the annual report prepared under IFRS or visit the Bank's office address for
+copies prepared under CAS. The Chinese and/or English versions of the annual report are also
+available on the following websites: www.boc.cn, www.sse.com.cn and www.hkexnews.hk.
+Should you have any queries about how to obtain copies of this annual report or access the
+document on the Bank's website, please call the Bank's H-Share Registrar at (852) 2862 8688 or
+the Bank's hotlines at (86) 10-6659 2638.
+455
+456
+Board of Directors
+Board Secretariat
+Audit Department
+Head Office Departments
+and Institutions
+Shareholders' Meeting
+Investor Enquiry
+Senior Management
+Board of
+Supervisors Office
+Domestic and Overseas
+Branches and Comprehensive
+Operation Companies
+Organisational Chart
+Institute of Bank of
+Institutions in the
+Chinese mainland
+Bank Card Center
+Institutions in Hong Kong,
+Macao, Taiwan of China and
+other countries and regions
+IT Operation Center
+Security Department
+SWIFT: BKCHCNBJ280
+Board of Supervisors
+FAX: (86) 0871-63175573
+POST CODE: 650051
+454
+<M<
+360035
+ZQ0362264
+Shareholder Enquiry
+If a shareholder wishes to enquire about share transfers, changes of name or address, or loss of
+share certificates, or to receive other information concerning the shares held, please write to the
+following address:
+A Share
+Shanghai Branch of China Securities
+Depository and Clearing Corporation Limited
+188 South Yanggao Road,
+Pudong New Area, Shanghai, China
+Telephone: (86) 21-4008 058 058
+H Share
+Computershare Hong Kong Investor
+Services Limited
+A
+17M Floor, Hopewell Centre,
+183 Queen's Road East,
+Telephone: (852) 2862 8555
+Facsimile: (852) 2865 0990
+Domestic Preference Share
+Shanghai Branch of China Securities Depository and Clearing Corporation Limited
+188 South Yanggao Road,
+Pudong New Area, Shanghai, China
+Telephone: (86) 21-4008 058 058
+Credit Rating (Long Term, Foreign Currency)
+S&P Global Ratings:
+Moody's Investors Service:
+Fitch Ratings:
+A
+A1
+Wan Chai, Hong Kong, China
+453
+TEL: (86) 0971-8178888
+NINGXIA BRANCH
+NINGXIA HUI
+AUTONOMOUS REGION,
+CHINA
+SWIFT: BKCHCNBJ260
+TEL: (86) 0951-5681505
+FAX: (86) 0951-5681509
+POST CODE: 750002
+XINJIANG BRANCH
+1 DONGFENG ROAD,
+URUMQI,
+XINJIANG UYGUR
+AUTONOMOUS REGION,
+CHINA
+SWIFT: BKCHCNBJ760
+TEL: (86) 0991-2328888
+FAX: (86) 0991-2825095
+POST CODE: 830002
+CHONGQING BRANCH
+218 ZHONG SHAN YI ROAD,
+YU ZHONG DISTRICT,
+CHONGQING,
+CHINA
+YINCHUAN,
+SWIFT: BKCHCNBJ59A
+TEL: (86) 023-63889234
+FAX: (86) 023-63889217
+POST CODE: 400013
+128 WANGDUN ROAD,
+SUZHOU INDUSTRIAL PARK,
+SUZHOU,
+JIANGSU PROV.,
+CHINA
+SWIFT: BKCHCNBJ95B
+TEL: (86) 0512-67555898
+FAX: (86) 0512-65112719
+POST CODE: 215028
+NINGBO BRANCH
+3-18/F, 48-49/F, 318 HEYUAN
+ROAD AND 255 DINGTAI
+ROAD, NINGBO CITY,
+ZHEJIANG PROV.,
+CHINA
+SWIFT: BKCHCNBJ92A
+TEL: (86) 0574-55555099
+POST CODE: 315100
+QINGDAO BRANCH
+59 HONGKONG
+MIDDLE ROAD,
+QINGDAO,
+SHANDONG PROV.,
+CHINA
+SWIFT: BKCHCNBJ50A
+TEL: (86) 0532-85979700
+FAX: (86) 0532-67755601
+POST CODE: 266071
+459
+SUZHOU BRANCH
+FAX: (86) 0971-8174971
+POST CODE: 810000
+39 XINCHANG EAST ROAD,
+JINFENG DISTRICT,
+SWIFT: BKCHCNBJ660
+SHENZHEN BRANCH
+INTERNATIONAL FINANCE
+BUILDING,
+2022 JIANSHE ROAD,
+LUOHU DISTRICT,
+SHENZHEN,
+GUANGDONG PROV.,
+CHINA
+SWIFT: BKCHCNBJ45A
+TEL: (86) 0755-22331155
+FAX: (86) 0755-22331051
+POST CODE: 518001
+TIBET BRANCH
+113 JINZHU XI LU,
+LHASA,
+TIBET AUTONOMOUS
+REGION,
+CHINA
+SWIFT: BKCHCNBJ900
+TEL: (86) 0891-6835311
+TEL: (86) 0931-7825004
+FAX: (86) 0931-7825004
+POST CODE: 730000
+FAX: (86) 0891-6835311
+SHAANXI BRANCH
+18 TANGYAN ROAD BEIDUAN,
+LIANHU DISTRICT,
+XI'AN,
+SHAANXI PROV.,
+CHINA
+SWIFT: BKCHCNBJ620
+TEL: (86) 029-89593900
+FAX: (86) 029-89592999
+POST CODE: 710077
+GANSU BRANCH
+525 TIANSHUI SOUTH ROAD,
+CHENGGUAN DISTRICT
+LANZHOU,
+GANSU PROV.,
+CHINA
+POST CODE: 850000
+Bloomberg
+Shanghai Stock Exchange
+中行優4
+14
+Balance of non-principal-guaranteed wealth management products
+670,782
+issued by the Bank
+15
+Balance of wealth management products issued by wealth
+718,122
+management subsidiary
+16 Cross-jurisdictional claims and liabilities
+7,931,434
+(1)
+The indicators above are unaudited data and prepared on a different basis compared with the financial scope
+of consolidation and adopted a different assessment methodology from global systemically important banks.
+451
+550,421
+Reference for Shareholders
+2021 Annual Results
+2021 Annual Report
+2022 Interim Results
+Dividends on Ordinary Shares
+To be announced on 29 March 2022
+To be printed and dispatched to H-Share Holders in
+late April 2022
+To be announced no later than 30 August 2022
+The Board of Directors recommended a final dividend on ordinary shares for 2021 of RMB2.21
+per 10 shares (before tax), subject to the approval of shareholders at the 2021 Annual General
+Meeting.
+Securities Information
+Listing and Trading
+The Bank's ordinary shares were listed on the Hong Kong Stock Exchange and SSE on 1 June
+and 5 July 2006 respectively.
+The Domestic Preference Shares (Third Tranche) were traded on the Comprehensive Business
+Platform of SSE on 17 July 2019. The Domestic Preference Shares (Fourth Tranche) were traded
+on the Comprehensive Business Platform of SSE on 17 September 2019. The Offshore Preference
+Shares (Second Tranche) were listed on the Hong Kong Stock Exchange on 5 March 2020.
+Ordinary Shares
+Financial Calendar for 2022
+Issued shares: 294,387,791,241 shares
+Assets of non-banking affiliates
+957,698
+1 FUXINGMEN NEI DAJIE,
+HEAD OFFICE
+MAJOR BRANCHES AND SUBSIDIARIES IN THE CHINESE MAINLAND
+List of Major Branches and Subsidiaries
+Taipei Branch
+Branches, subsidiaries and
+representative offices in other
+countries and regions
+BOC Financial Technology
+Bank of China Consumer
+Finance
+BOCL
+BOC Asset Investment
+BOCI China Note
+Beijing College of
+||
+I
+13
+Center
+Corporate Culture
+Department
+Information Settlement ||
+Comprehensive Operation
+Commercial banking
+Comprehensive Operation
+Commercial banking
+Software Center
+ון
+ון
+Derivatives
+12,453,130
+12
+Securities measured at fair value
+11
+Including:
+A Share:
+210,765,514,846 shares
+HKD2.59
+H Share
+中國銀行
+Stock Name
+Bank of China
+601988
+601988.SS
+Hong Kong Stock Exchange
+Reuters
+3988
+3988.HK
+601988 CH
+Bloomberg
+3988 HK
+price in the year
+Reuters
+中行優3
+Shanghai Stock Exchange
+360033
+Bloomberg
+AZ8714182
+Offshore Preference Share (Second Tranche)
+Stock Name
+BOC 20USDPREF
+Hong Kong Stock Exchange 4619
+Reuters
+Bloomberg
+4619.HK
+BG2289661
+Domestic Preference Share (Fourth Tranche)
+Stock Name
+Domestic Preference Share (Third Tranche)
+Stock Name
+Lowest trading
+price in the year
+RMB2.96
+Lowest trading
+H Share:
+83,622,276,395 shares
+Preference Shares
+Issued shares:
+Including:
+Domestic Preference Share:
+1,197,865,300 shares
+1,000,000,000 shares
+Offshore Preference Share:
+197,865,300
+shares
+452
+Market Capitalisation
+As at the last trading day of 2021 (31 December), the Bank's market capitalisation was
+RMB834.953 billion (based on the closing price of A Shares and H Shares on 31 December
+2021, and the exchange rate of HKD100 RMB81.76 as published by the SAFE on 31 December
+2021).
+Securities Price
+=
+A Share
+H Share
+Securities Code
+A Share
+Stock Name
+Shanghai Stock Exchange
+Closing price on
+31 December 2021
+RMB3.05
+Closing price on
+31 December 2021
+HKD2.81
+Highest trading
+price in the year
+RMB3.38
+Highest trading
+price in the year
+HKD3.17
+CHINA
+Note: The Bank holds 33.42% of the equity interest of BOCI China through its wholly-owned subsidiary BOCI.
+EMAIL: service.kh@bankofchina.com
+1051 BUDAPEST,
+BOULEVARD DU REGENT 35,
+BRUSSELS BRANCH
+(EUROPE) S.A.
+BANK OF CHINA
+dublinbranch@bank-of-hina.com
+SWIFT: BKCHIE3DXXX
+TEL: (353) 14768888
+EMAIL:
+IRELAND
+DUBLIN 2,
+5TH FLOOR, STYNE HOUSE,
+UPPER HATCH STREET,
+www.bankofchina.com/se
+WEBSITE:
+service.se@bankofchina.com
+FAX: (46) 107888801
+EMAIL:
+1000, BRUSSELS,
+TEL: (46) 107888888
+BIRGER JARLSGATAN 28,
+114 34 STOCKHOLM,
+SWEDEN
+www.bankofchina.com/nl
+WEBSITE:
+service.nl@bankofchina.com
+FAX: (31) 102175899
+EMAIL:
+3012AB ROTTERDAM,
+THE NETHERLANDS
+SWIFT: BKCHNL2R
+TEL: (31) 102175888
+COOLSINGEL 63,
+DUBLIN BRANCH
+(EUROPE) S.A.
+BANK OF CHINA
+STOCKHOLM BRANCH
+(EUROPE) S.A.
+BANK OF CHINA
+SWIFT: BKCHSESS
+BELGIUM
+SWIFT: BKCHBEBB
+TEL: (32) 24056688
+EMAIL: info@bocigroup.com
+WEBSITE: www.bocigroup.com
+7 JOZSEF NADOR TER,
+(CENTRAL AND EASTERN
+EUROPE) LIMITED
+BANK OF CHINA
+EMAIL: info.gr@bankofchina.com
+TEL: (30) 2111906688
+14TH FLOOR, ATHENS
+TOWERS, MESOGEION AV.2,
+115 27, ATHENS, GREECE
+SWIFT: BKCHGRAA
+BANK OF CHINA
+(EUROPE) S.A.
+ATHENS BRANCH
+www.bankofchina.com/pt
+WEBSITE:
+service.pt@bankofchina.com
+TEL: (351) 210495710
+FAX: (351) 210495738
+EMAIL:
+SWIFT: BKCHPTPL
+NO. 35, 35A E 37;
+1250-097 LISBOA,
+PORTUGAL
+RUA DUQUE DE PALMELA
+LISBON BRANCH-
+SUCURSAL EM PORTUGAL
+BANK OF CHINA
+(EUROPE) S.A.
+www.bankofchina.com/pl
+WEBSITE:
+service.pl@bankofchina.com
+FAX: (48) 224178887
+EMAIL:
+SWIFT: BKCHPLPX
+TEL: (48) 224178888
+UL. ZIELNA 41/43,
+00-108 WARSAW,
+POLAND
+BANK OF CHINA
+(EUROPE) S.A.
+POLAND BRANCH
+www.bankofchina.com/be
+WEBSITE:
+service.be@bankofchina.com
+EMAIL:
+FAX: (32) 22302892
+ROTTERDAM BRANCH
+(EUROPE) S.A.
+BANK OF CHINA
+466
+www.bankofchina.com/fr
+FAX: (33) 149701372
+WEBSITE:
+TEL: (33) 149701370
+SWIFT: BKCHFRPP
+TLX: 281 090 BDCSP
+23-25 AVENUE DE LA
+GRANDE ARMEE
+75116 PARIS,
+FRANCE
+PARIS BRANCH
+SUITE 202, SOBO WORKS,
+WINDMILL LANE,
+DUBLIN D02 K156
+REPUBLIC OF IRELAND
+(IRELAND) LIMITED
+BOC AVIATION
+www.bankofchina.com/uk
+WEBSITE:
+service.uk@bankofchina.com
+EMAIL:
+FAX: (44) 2076263892
+TEL: (44) 2072828888
+SWIFT: BKCHGB2U
+LONDON EC2R 7DB,
+U.K.
+1 LOTHBURY,
+(UK) LIMITED
+BANK OF CHINA
+www.bankofchina.com/uk
+WEBSITE:
+service.uk@bankofchina.com
+FAX: (44) 2076263892
+EMAIL:
+TEL: (44) 2072828888
+SWIFT: BKCHGB2L
+LONDON EC2R 7DB,
+U.K.
+1 LOTHBURY,
+LONDON BRANCH
+FRANKFURT BRANCH
+HUNGARY
+BOCKENHEIMER LANDSTR.
+SWIFT: BKCHDEFF
+www.bankofchina.com/lu
+WEBSITE:
+service.lu@bankofchina.com
+SWIFT: BKCHLULA
+TEL: (352) 268688
+FAX: (352) 221795
+EMAIL:
+P.O. BOX 721 L-2017,
+LUXEMBOURG
+LUXEMBOURG
+37/39 BOULEVARD
+PRINCE HENRI L-1724
+BANK OF CHINA (EUROPE)
+S.A.
+www.bankofchina.com/lu
+WEBSITE:
+service.lu@bankofchina.com
+SWIFT: BKCHLULL
+TEL: (352) 268688
+FAX: (352) 221795
+EMAIL:
+P.O. BOX 114 L-2011,
+LUXEMBOURG
+LUXEMBOURG
+PRINCE HENRI L-1724
+37/39 BOULEVARD
+LUXEMBOURG BRANCH
+www.bankofchina.com/it
+TEL: (39) 02864731
+FAX: (39) 0289013411
+WEBSITE:
+SWIFT: BKCHITMM
+ITALY
+VIA SANTA MARGHERITA,
+14/16-20121 MILAN,
+MILAN BRANCH
+www.bankofchina.com/de
+WEBSITE:
+service.de@bankofchina.com
+EMAIL:
+FAX: (49) 69170090500
+TEL: (49) 691700900
+24 60323 FRANKFURT AM MAIN,
+GERMANY
+EUROPE
+SWIFT: BKCHHUHB
+service.hu@bankofchina.com
+CAYMAN ISLANDS
+GRAND CAYMAN KY1-1204
+802 WEST BAY ROAD,
+P.O. BOX 30995,
+COMMERCIAL CENTER
+GRAND PAVILION
+GRAND CAYMAN BRANCH
+TEL: (1212) 9353101
+SWIFT: BKCHUS33
+U.S.A.
+NEW YORK, NY 10018,
+1045 AVENUE OF THE AMERICAS,
+NEW YORK BRANCH
+AMERICA
+SWIFT: BKCHKYKY
+service.ch@bank-of-hina.com
+RUE DE LA TOUR-DE-1
+ILE 1, CH-1204 GENEVA,
+SWITZERLAND
+GENEVA BRANCH
+service.ca@bankofchina.com
+FAX: (1416) 9559880
+EMAIL:
+EMAIL: iboc@boc.ru
+WEBSITE: www.boc.ru
+service.ro@bankofchina.com
+EMAIL:
+FAX: (40) 318029889
+TEL: (40) 318029888
+SWIFT: BKCHROBUXXX
+PIATA PRESEI LIBERE,
+NR. 3-5, TURNUL DE SUD
+AL CLADIRII CITY GATE,
+ETAJ11, BUCHAREST,
+ROMANIA
+SECTORUL 1,
+EUROPE) LIMITED
+BUCHAREST BRANCH
+SWIFT: BKCHCHGE
+TEL: (415)86116800
+FAX: (415)86116801
+EMAIL:
+TEL: (1345) 9452000
+FAX: (1345) 9452200
+EMAIL:
+gcb@bank-of-china.com
+FAX: (1212) 5931831
+BANCO DA CHINA
+bocpanama@cwpanama.net
+FAX: (260) 211236782
+TEL: (52) 5541705800
+FAX: (507) 2239960
+EMAIL:
+TEL: (507) 2169400
+TEL: (260) 211233271
+SWIFT: BKCHZMLU
+P. O. BOX 34550, LUSAKA,
+ZAMBIA
+KABELENGA ROAD,
+BANK OF CHINA
+(ZAMBIA) LIMITED
+PLOT NO. 2339,
+AFRICA
+SWIFT: BKCHMXMX
+CUAUHTÉMOC, CIUDAD
+DE MÉXICO,
+MEXICO
+PISO 24, COLONIA
+PASEO DE LA REFORMA 243,
+MÚLTIPLE
+S.A. INSTITUCIÓN DE BANCA
+BANK OF CHINA MÉXICO,
+SWIFT: BKCHPAPA
+REPUBLIC OF PANAMA
+PANAMA CITY,
+TORRE 2000 PISO 36
+P.H. OCEANIA BUSINESS PLAZA
+PUNTA PACIFICA
+P.O. BOX 0823-01030
+PANAMA BRANCH
+468
+WEBSITE: www.bocusa.com
+(CENTRAL AND EASTERN
+BANK OF CHINA
+www.bankofchina.com/at
+WEBSITE:
+SWIFT: BKCHRSBGXXX
+TEL: (381) 116351000
+FAX: (381) 112280777
+EMAIL:
+11070 BELGRADE,
+SERBIA
+BULEVAR ZORANA
+DINDICA 2A,
+SRBIJA A.D. BEOGRAD
+BANK OF CHINA
+service.cz@bankofchina.com
+EMAIL:
+FAX: (42) 0225986699
+TEL: (42) 0225986666
+SWIFT: BKCHCZPPXXX
+NOVE MESTO, 11000 PRAHA 1,
+CZECH REPUBLIC
+NA FLORENCI 2116/15,
+PRAGUE BRANCH
+EUROPE) LIMITED
+(CENTRAL AND EASTERN
+BANK OF CHINA
+467
+www.bankofchina.com/hu
+WEBSITE:
+service.hu@bankofchina.com
+EMAIL:
+FAX: (36) 14299202
+TEL: (36) 14299200
+SWIFT: BKCHHUHH
+HUNGARY
+7 JOZSEF NADOR TER, 1051
+BUDAPEST,
+HUNGARIAN BRANCH
+www.bankofchina.com/hu
+WEBSITE:
+service.rs@bankofchina.com
+TEL: (36) 14299200
+FAX: (36) 14299202
+EMAIL:
+WEBSITE:
+BANK OF CHINA (CANADA)
+service.at@bankofchina.com
+TEL: (43) 153666800
+FAX: (43) 153666888
+EMAIL:
+TEL: (1416) 9559788
+FAX: (7495) 7950454
+SWIFT: BKCHATWWXXX
+SWIFT: BKCHCAT2
+TEL: (7495) 2585301
+CANADA, M5X 1C8
+TORONTO, ONTARIO,
+P.O. BOX 241,
+6108 ONE FIRST CANADIAN PLACE,
+100 KING STREET WEST,
+TORONTO BRANCH
+SWIFT: BKCHRUMM
+MOSCOW, 129110
+RUSSIA
+72, PROSPEKT MIRA,
+BANK OF CHINA (RUSSIA)
+1010 VIENNA,
+AUSTRIA
+SCHOTTENRING 18,
+VIENNA BRANCH
+EUROPE) LIMITED
+(CENTRAL AND EASTERN
+BANK OF CHINA
+www.bankofchina.com/ca
+WEBSITE:
+service.ca@bankofchina.com
+TEL: (1905) 7716886
+FAX: (1905) 7718555
+EMAIL:
+CANADA, L3T 7X8
+SWIFT: BKCHCATT
+50 MINTHORN BOULEVARD
+MARKHAM, ONTARIO,
+SUITE 600,
+www.bankofchina.com/rs
+BRASIL S.A.
+EMAIL: information@bocaviation.com
+WEBSITE: www.bocaviation.com
+BOC AVIATION LIMITED
+KOREA
+SEOUL 03188
+JONGNO-GU,
+41, CHEONG GYE CHEON-RO,
+1/2/3F YOUNG POONG BLDG.
+WEBSITE: www.bankofchina.com/kh
+FAX: (855) 23988880
+TEL: (855) 23988886
+SWIFT: BKCHKHPP
+P.O. BOX 110, PHNOM PENH,
+CAMBODIA
+# 315 ANG DOUNG ST.
+CANADIA TOWER,
+1ST & 2ND FLOOR,
+BANK OF CHINA
+(HONGKONG) LIMITED
+PHNOM PENH BRANCH
+SWIFT: BKCHKRSEXXX
+FAX: (62) 215201113/215207552
+EMAIL: cs@bankofchina.co.id
+WEBSITE: www.bankofchina.co.id
+INDONESIA
+JAKARTA SELATAN, 12920,
+SUDIRMAN KAV. 24,
+Jl. JENDRAL
+11TH FLOOR,
+TAMARA CENTER
+BANK OF CHINA
+(HONGKONG) LIMITED
+JAKARTA BRANCH
+EMAIL: service.th@bankofchina.com
+WEBSITE: www.bankofchina.com/th
+CUSTOMER SERVICE CENTRE:
+(66) 26795566
+TEL: (66) 22861010
+FAX: (66) 22861020
+SWIFT: BKCHTHBK
+THAILAND
+BANGKOK 10120,
+SWIFT: BKCHIDJA
+TEL: (62) 215205502
+TEL: (82) 16705566
+FAX: (82) 23996265
+WEBSITE:
+LOT NO. 56244,
+KIARONG JAYA KOMPLEK,
+(HONGKONG) LIMITED
+BRUNEI BRANCH
+BANK OF CHINA
+EMAIL: service.la@bankofchina.com
+WEBSITE: www.bankofchina.com.la
+VIENTIANE CENTER,
+KHOUVIENG ROAD,
+NONGCHAN VILLAGE,
+SISATTANAK DISTRICT,
+VIENTIANE CAPITAL,
+LAO P.D.R.
+SWIFT: BKCHLALAXXX
+TEL: (856) 21228888
+FAX: (856) 21228880
+NO. A1003-A2003,
+BANK OF CHINA
+(HONGKONG) LIMITED
+VIENTIANE BRANCH
+ph@bank-of-china.com
+TEL: (63) 282977888
+FAX: (63) 288850532
+EMAIL: customercare_
+SWIFT: BKCHPHMM
+TAGUIG CITY, METRO
+MANILA PHILIPPINES
+28/F. THE FINANCE CENTER
+26th STR. Cor. 9th AVE., BGC
+BANK OF CHINA
+(HONGKONG) LIMITED
+MANILA BRANCH
+EMAIL: service.vn@bankofchina.com
+WEBSITE: www.bankofchina.com.vn
+FAX: (84) 2838219948
+TEL: (84) 2838219949
+SWIFT: BKCHVNVX
+VIETNAM
+HOCHIMINH CITY,
+DISTRICT 1,
+22-36 NGUYEN HUE STREET,
+TIMES SQUARE BUILDING,
+GROUND & 11TH FL,
+HOCHIMINH CITY BRANCH
+(HONGKONG) LIMITED
+BANK OF CHINA
+463
+www.bankofchina.com/kr
+SATHORN DISTRICT,
+TUNGMAHAMEK
+179/4 BANGKOK CITY TOWER,
+SOUTH SATHORN ROAD,
+BANK OF CHINA (THAI)
+PUBLIC COMPANY LIMITED
+MACAO, CHINA
+TEL: (853) 28322323
+FAX: (853) 28570737
+418, ALAMEDA DR. CARLOS,
+d'ASSUMPCAO,
+TAI FUNG BANK LIMITED
+EMAIL: bocmo@bocmacau.com
+WEBSITE: www.bankofchina.com/mo
+TEL: (853) 88895566
+FAX: (853) 28781833
+SWIFT: BKCHMOMX
+MACAO, CHINA
+BANK OF CHINA BUILDING,
+AVENIDA DOUTOR MARIO
+SOARES,
+MACAU BRANCH
+EMAIL: info_ins@bocgroup.com
+WEBSITE: www.bocgins.com
+HONG KONG, CHINA
+TEL: (852) 28670888
+FAX: (852) 25221705
+9/F, WING ON HOUSE,
+71 DES VOEUX ROAD
+CENTRAL,
+BANK OF CHINA GROUP
+INSURANCE COMPANY
+LIMITED
+FAX: (852) 25377609
+TEL: (852) 28101203
+HONG KONG, CHINA
+1 GARDEN ROAD,
+7/F, BANK OF CHINA TOWER,
+EMAIL: service.tw@bankofchina.com
+WEBSITE: www.bankofchina.com/tw
+1-5/F, NO. 105, SONGREN ROAD,
+XINYI DIST., TAIPEI CITY,
+TAIWAN, CHINA
+SWIFT: BKCHTWTP
+TEL: (886) 227585600
+FAX: (886) 227581598
+EMAIL: enquiry@boclife.com.hk
+WEBSITE: www.boclife.com.hk
+13/F, CITYPLAZA ONE,
+1111 KING'S ROAD,
+TAIKOO SHING,
+HONG KONG, CHINA
+TEL: (852) 21608800
+FAX: (852) 28660938
+BOC GROUP LIFE
+ASSURANCE CO., LTD.
+FAX: (852) 28772629
+EMAIL: bocginv_bgi@bocgroup.com
+WEBSITE: www.bocgi.com
+TEL: (852) 22007500
+HONG KONG, CHINA
+1 GARDEN ROAD,
+23/F, BANK OF CHINA TOWER,
+TAIPEI BRANCH
+EMAIL: tfbsecr@taifungbank.com
+WEBSITE: www.taifungbank.com
+SIMPANG 22,
+462
+ASIA-PACIFIC AREA
+FAX: (60) 321615150
+EMAIL: service.my@bankofchina.com
+WEBSITE: www.bankofchina.com/my
+SEOUL BRANCH
+www.bankofchina.com/jp
+WEBSITE:
+service.jp@boctokyo.co.jp
+EMAIL:
+FAX: (81) 335058868
+TEL: (81) 335058818
+SWIFT: BKCHJPJT
+JAPAN
+TOKYO 107-0052
+BOC BLDG. 3-4-1 AKASAKA
+MINATO-KU,
+TOKYO BRANCH
+www.bankofchina.com/sg
+WEBSITE:
+service.sg@bankofchina.com
+EMAIL:
+TEL: (60) 323878888
+FAX: (65) 65343401
+SWIFT: BKCHMYKL
+MALAYSIA
+GROUND, MEZZANINE, &
+1ST FLOOR PLAZA OSK,
+25 JALAN AMPANG
+50450 KUALA LUMPUR,
+BANK OF CHINA
+(MALAYSIA) BERHAD
+TEL: (65) 67795566
+SWIFT: BKCHSGSGXXX
+SINGAPORE
+BANK OF CHINA BUILDING,
+4 BATTERY ROAD,
+SINGAPORE BRANCH
+MAJOR BRANCHES AND SUBSIDIARIES IN OTHER COUNTRIES AND REGIONS
+8 SHENTON WAY #18-01
+SINGAPORE 068811
+TEL: (65) 63235559
+FAX: (65) 63236962
+JALAN DATO
+KAMPONG KIARONG,
+NO. 40, YORK STREET
+EMAIL: contact@bankofchina.com.tr
+WEBSITE: www.bankofchina.com.tr
+FAX: (90) 2122798866
+TEL: (90) 2122608888
+SWIFT: BKCHTRIS
+TURKEY
+ISTANBUL
+343944. LEVENT/SISLI/
+BUYUKDERE CAD.NO: 209,
+TEKFEN TOWER K.21,
+ABU DHABI BRANCH
+FAX: (971) 43880778
+EMAIL: service.ae@bankofchina.com
+TEL: (971) 43819100
+SWIFT: BKCHAEADXXX
+COLOMBO 001
+DUBAI, U.A.E
+AL FATTAN CURRENCY HOUSE
+DUBAI INTERNATIONAL
+FINANCIAL CENTRE
+LEVEL 11 TOWER 2,
+COLOMBO BRANCH
+EMAIL: services.pk@bankofchina.com
+WEBSITE: www.bankofchina.com/pk
+FAX: (92) 2133110600
+TEL: (92) 2133110688
+SWIFT: BKCHPKKA
+PAKISTAN
+KARACHI,
+DOLMEN CITY, HC-3, BLOCK 4,
+SCHEME 5, CLIFTON,
+5TH FLOOR, CORPORATE
+OFFICE BLOCK,
+BANK OF CHINA TURKEY A.S.
+EMAIL: service.qa@bankofchina.com
+P.O. BOX 118842,
+SRI LANKA
+SWIFT: BKCHLKLX
+TEL: (94) 0112195566
+bldbcbgs@bank-of-china.com
+EMAIL:
+FAX: (973) 17531009
+TEL: (973) 17531119
+KINGDOM OF BAHRAIN
+ROAD 1702, BLOCK 317,
+MANAMA
+BUILDING 95,
+DIPLOMATIC AREA
+AL JASRAH TOWER,
+OFFICE 1502,
+OFFICE
+BAHRAIN REPRESENTATIVE
+465
+EMAIL: service.mn1 @bankofchina.com
+FAX: (976) 77195566
+TEL: (976) 77095566
+MONGOLIA
+ULAANBAATAR 14200,
+SBD-8,
+11TH FLOOR CENTRAL TOWER,
+SUKHBAATAR SQUARE-2,
+REPRESENTATIVE OFFICE
+ULAANBAATAR
+EMAIL: abudhabi.ae@bankofchina.com
+FAX: (971) 24180996
+TEL: (971) 24180999
+EMAIL: service.lk@bankofchina.com
+ADDAX COMMERCIAL TOWER,
+AL REEM ISLAND,
+P.O. BOX 73098,
+ABU DHABI, U.A.E.
+SWIFT: BKCHAEAA
+UNIT 8-11, 46F,
+FAX: (94) 0112118800
+TEL: (974) 44473681/44473682
+FAX: (974) 44473696
+SWIFT: BKCHQAQA
+P.O. BOX: 5768
+QATAR
+LEVEL 17, TOWER 1,
+205 QUEEN STREET,
+AUCKLAND, 1010,
+(NEW ZEALAND) LIMITED
+BANK OF CHINA
+EMAIL: banking.au@bankofchina.com
+WEBSITE: www.bankofchina.com/au
+FAX: (61) 292621794
+TEL: (61) 282355888
+SWIFT: BKCHAU2A
+140 SUSSEX STREET,
+SYDNEY NSW 2000,
+AUSTRALIA
+GROUND FLOOR,
+BANK OF CHINA
+(AUSTRALIA) LIMITED
+EMAIL: banking.au@bankofchina.com
+WEBSITE: www.bankofchina.com/au
+FAX: (61) 292621794
+GROUND FLOOR,
+140 SUSSEX STREET,
+SYDNEY NSW 2000,
+AUSTRALIA
+SWIFT: BKCHAU2S
+TEL: (61) 282355888
+SYDNEY BRANCH
+EMAIL: service.hn@bankofchina.com.vn
+TEL: (84) 909009222
+VIET NAM
+18 FLOOR, NO. 1 TOWER,
+CAPITAL PLACE BUILDING,
+29 LIEU GIAI STREET,
+NGỌC KHANH WARD,
+BA DINH DISTRICT,
+HA NOI,
+IN HANOI
+BANK OF CHINA
+(HONG KONG) LIMITED
+REPRESENTATIVE OFFICE
+EMAIL: bocyangon@bochk.com
+FAX: (95) 19376142
+ZONE B, 1ST FLOOR,
+GOLDEN CITY
+BUSINESS CENTER,
+YANKIN ROAD,
+YANKIN TOWNSHIP,
+YANGON REGION,
+MYANMAR
+SWIFT: BKCHMMMY
+TEL: (95) 19376130
+BANK OF CHINA
+(HONGKONG) LIMITED
+YANGON BRANCH
+FAX: (673) 2459878
+SWIFT: BKCHBNBB
+TEL: (673) 2459888
+DARUSSALAM
+BEGAWAN BE1318,
+BRUNEI
+BANDAR SERI
+NEW ZEALAND
+SWIFT: BKCHNZ22
+TEL: (64) 99809000
+FAX: (64) 99809088
+RATNA,
+EMAIL: service.nz@bankofchina.com
+WEBSITE: www.bankofchina.com/nz
+LEVEL 17, TOWER 1,
+205 QUEEN STREET,
+AUCKLAND, 1010,
+24TH FLOOR, ALFARDAN
+TOWERS-OFFICE TOWER,
+BUILDING NO. 12, ZONE 61,
+AL FUNDUQ, STREET NO. 814,
+DOHA,
+QATAR FINANCIAL CENTRE
+BRANCH
+DUBAI BRANCH
+EMAIL: bocmumbai@bankofchina.com
+TEL: (91) 2268246666
+FAX: (91) 2268246667
+SWIFT: BKCHINBB
+INDIA
+MUMBAI,
+BANDRA KURLA COMPLEX,
+BANDRA EAST,
+4 NORTH AVENUE,
+MAKER MAXITY,
+41-B, 4TH FLOOR,
+MUMBAI BRANCH
+KARACHI BRANCH
+EMAIL: boc@bankofchina.kz
+FAX: (7727) 2585514
+TEL: (7727) 2585510
+SWIFT: BKCHKZKA
+REPUBLIC OF KAZAKHSTAN
+ALMATY,
+AUEZOV DISTRICT, 050063,
+ZHETYSU-2,
+71B, MICRODISTRICT
+JSC AB (BANK OF CHINA
+KAZAKHSTAN)
+WEBSITE: www.bankofchina.com/nz
+464
+EMAIL: service.nz@bankofchina.com
+FAX: (64) 99809088
+TEL: (64) 99809000
+NEW ZEALAND
+SWIFT: BKCHNZ2A
+AUCKLAND BRANCH
+BANK OF CHINA GROUP
+INVESTMENT LIMITED
+AVENIDA PAULISTA,
+CEP: 01311-100,
+FAX: (86) 021-38973713
+TEL: (86) 021-20408162
+CHINA
+SHANGHAI,
+PUDONG NEW DISTRICT,
+NO. 288 KAYUAN 2ND ROAD,
+TECHNOLOGY CO., LTD.
+BOC FINANCIAL
+https://www.bocwm.cn
+WEBSITE:
+POST CODE: 100033
+POST CODE: 201201
+FAX: (86) 010-83937555
+China
+Beijing,
+Xicheng District,
+No. 6 Jinrong St,
+8F/11F/12F,
+MANAGEMENT CO., LTD.
+BOC WEALTH
+460
+TEL: (86) 010-83262479
+FAX: (86) 010-83262478
+POST CODE: 100032
+EMAIL: bocfi@bocfi.com
+XICHENG DISTRICT,
+BEIJING,
+CHINA
+8/F, NO. 110 XIDAN NORTH
+STREET,
+TEL: (86) 010-83937333
+BOC FINANCIAL ASSET
+INVESTMENT CO., LTD.
+WEBSITE:
+BOC FINANCIAL LEASING
+TEL: (852) 39886000
+HONG KONG, CHINA
+1 GARDEN ROAD,
+26/F, BANK OF CHINA TOWER,
+BOC INTERNATIONAL
+HOLDINGS LIMITED
+WEBSITE: www.bochk.com
+FAX: (852) 28105830
+TEL: (852) 28462700
+HONG KONG, CHINA
+1 GARDEN ROAD,
+24/F, BANK OF CHINA TOWER,
+www.fintechboc.com
+(HOLDINGS) LIMITED
+MAJOR BRANCHES AND SUBSIDIARIES IN HONG KONG, MACAO AND TAIWAN
+OF CHINA
+461
+EMAIL: bocfl@bankofchina.com
+POST CODE: 400010
+FAX: (86) 023-63031966
+TEL: (86) 023-63031966
+CHINA
+CHONGQING
+YUZHONG DISTRICT,
+NO. 131 ZOURONG ROAD,
+CO., LTD.
+BOC HONG KONG
+FAX: (852) 21479065
+www.boc-samsunglife.cn
+CHINA
+149 LUOSA STREET,
+RONGCHENG,
+HEBEI XIONGAN BRANCH
+FAX: (86) 0592-5095130
+POST CODE: 361012
+TEL: (86) 0592-5317519
+SWIFT: BKCHCNBJ73A
+XIAMEN
+CHINA
+NO. 40 NORTH HUBIN ROAD
+BOC BLDG.,
+www.bocfullertonbank.com
+TEL: (86) 010-57765000
+FAX: (86) 010-57765550
+POST CODE: 100032
+WEBSITE:
+CHINA
+HEBEI PROV.,
+CHINA
+NO. 110 XIDAN NORTH STREET,
+XICHENG DISTRICT,
+BEIJING,
+COMMUNITY BANK CO., LTD.
+BOC FULLERTON
+TEL: (86) 021-38834999
+FAX: (86) 021-68873488
+POST CODE: 200120
+WEBSITE: www.bocim.com
+CHINA
+45/F, BOC BUILDING
+200 MID. YINCHENG ROAD,
+PUDONG NEW DISTRICT,
+SHANGHAI,
+BANK OF CHINA INVESTMENT
+MANAGEMENT CO., LTD.
+XIAMEN BRANCH
+SWIFT: BKCHCNBJ81A
+TEL: (86) 0411-82586666
+FAX: (86) 0411-82637098
+POST CODE: 116001
+LIAONING PROV.,
+CHINA
+9 ZHONGSHAN SQUARE,
+ZHONGSHAN DISTRICT,
+DALIAN,
+DALIAN BRANCH
+9/F,
+TEL: (86) 010-83262688
+FAX: (86) 010-83262777
+POST CODE: 100032
+WEBSITE:
+SWIFT: BKCHCNBJ220
+TEL: (86) 0312-5988023
+FAX: (86) 0312-5557047
+POST CODE: 071700
+9/10/11F
+XICHENG DISTRICT,
+BEIJING,
+9/F, NO. 110 XIDAN NORTH
+STREET,
+BOC-SAMSUNG LIFE INS.
+CO., LTD.
+www.bocichina.com
+WEBSITE:
+admindiv.china@bocichina.com
+TEL: (86) 021-20328000
+FAX: (86) 021-58883554
+POST CODE: 200120
+EMAIL:
+CHINA
+200 MID. YINCHENG ROAD,
+PUDONG NEW DISTRICT,
+SHANGHAI,
+39/F, BOC BUILDING
+BOC INTERNATIONAL
+(CHINA) CO., LTD.
+BANK OF CHINA INSURANCE
+CO., LTD.
+TEL: (86) 021-63291722
+FAX: (86) 021-63291789
+POST CODE: 200120
+EMAIL: zyxf@boccfc.cn
+WEBSITE: www.boccfc.cn
+200 MID. YINCHENG ROAD,
+PUDONG NEW DISTRICT,
+SHANGHAI,
+1409#, BOC BUILDING
+BANK OF CHINA CONSUMER
+FINANCE CO., LTD.
+WEBSITE: www.bocins.com
+POST CODE: 100032
+FAX: (86) 010-83260006
+TEL: (86) 010-83260001
+CHINA
+BEIJING,
+XICHENG DISTRICT,
+NO. 110 XIDAN NORTH
+STREET,
+CHINA
+901-14 ANDAR BELA VISTA
+HONG KONG BRANCH
+469
+PERU REPRESENTATIVE
+OFFICE
+AV. REPULICA DE PANAMA
+3461,
+PISO 28, SAN ISIDRO, LIMA,
+PERU
+TEL: (51) 920137238
+EMAIL:
+service.pe@bankofchina.com
+EMAIL:
+executive.zm@bank-of-china.com
+WEBSITE:
+www.bankofchina.com/zm
+JOHANNESBURG BRANCH
+www.bankofchina.com/pe
+EMAIL: bocjhb@bank-of-china.com
+WEBSITE:
+BANK OF CHINA
+(MAURITIUS) LIMITED
+4TH-5TH FLOOR,
+DIAS PIER BUILDING,
+CAUDAN WATERFRONT,
+PORT LOUIS,
+MAURITIUS
+SWIFT: BKCHMUMU
+TEL: (230) 2034878
+FAX: (230) 2034879
+EMAIL:
+services.mu@bankofchina.com
+WEBSITE:
+www.bankofchina.com/mu
+www.bankofchina.com/za
+WEBSITE:
+14TH-16TH FLOORS,
+ALICE LANE TOWERS,
+15 ALICE LANE, SANDTON,
+JOHANNESBURG,
+SOUTH AFRICA
+SWIFT: BKCHZAJJ
+TEL: (27) 115209600
+FAX: (27) 117832336
+SWIFT: BKCHPEPL
+TEL: (51) 17037700
+EMAIL:servicios@pe.bocusa.com
+SAO PAULO, SP,
+BRASIL
+SWIFT: BKCHBRSP
+TEL: (55) 1135083200
+FAX: (55) 1135083299
+EMAIL:
+ouvidoria@boc-brazil.com
+WEBSITE:
+www.bankofchina.com/br
+ANDRÉSBELLO2457,
+PISO 16, PROVIDENCIA,
+SANTIAGO,
+CHILE
+SWIFT: BKCHCLRM
+TEL: (56) 227157800
+CHILE BRANCH
+AV. REPULICA DE PANAMA
+3461,
+INT. 2901, SAN ISIDRO, LIMA,
+PERU
+FAX: (56) 227157898
+BANK OF CHINA (PERU) S.A.
+SWIFT: BKCHARBAXXX
+TEL: (54) 1154395566
+EMAIL: service.ar@bankofchina.com
+JUANA MANSO 999,
+PISO 5, CABA,
+ARGENTINA
+www.bankofchina.com/mx
+EMAIL: servicios @mx.bocusa.com
+WEBSITE:
+FAX: (52) 5552078705
+EMAIL: servicios@cl.bocusa.com
+WEBSITE: www.bankofchina.com/cl
+BUENOS AIRES BRANCH
+WEBSITE:
+ZONE INDUSTRIELLE SUD,
+LOT NUMERO 219B,
+BANQUE DE CHINE
+(DJIBOUTI) S.A.
+NAIROBI,
+service.ao@bankofchina.com
+REPUBLIC OF ANGOLA
+FAX: (244) 923165717
+TEL: (244) 923165700
+SWIFT: BKCHAOLU
+B.P. 2119,
+EMAIL:
+DJIBOUTI
+MORNING SIDE OFFICE PARK,
+service.ma@bankofchina.com
+TANZANIA
+REPRESENTATIVE OFFICE
+8TH FLOOR, AMANI PLACE,
+OHIO STREET, P.O. BOX 13602,
+DAR ES SALAAM,
+TANZANIA
+TEL: (225) 222112973
+FAX: (225) 222112974
+EMAIL:
+repoffice.tz@bankofchina.com
+SWIFT: BKCHDJJD
+TEL: (253) 21336666
+FAX: (253) 21336699
+NAIROBI REPRESENTATIVE
+OFFICE
+ANDAR,
+LUANDA,
+NO. 71, ANFA CENTER, 128,
+BD D'ANFA & ANGLE
+RUE LAHCEN BASRI,
+CASABLANCA, MAROC
+TEL: (212) 522203779
+FAX: (212) 522273083
+EMAIL:
+VIA S10 No. 701,
+CONDOMINIO BELAS
+BUSSINESS PARK,
+TORRE CUANZA SUL 8
+www.bankofchina.com/ao
+MOROCCO
+NGONG ROAD,
+REPRESENTATIVE OFFICE
+470
+service.ke@bankofchina.com
+P.O. BOX 21357-00505,
+FAX: (254) 203862812
+TEL: (254) 203862811
+LUANDA BRANCH
+KENYA
+EMAIL:
+4
+43
+Intensifying comprehensive support. The Bank promoted transformation across its
+technology finance business, expanding its client base from mature corporates to businesses
+To better integrate itself into building the country as a global leader in science and technology,
+the Bank prioritised technology finance in its first development strategy under the "Eight Priority
+Areas for Enhancing Financial Services Capabilities”, committing to becoming an all-elements
+integrator, a full-chain innovator and a full-cycle provider of technology finance, with the aim of
+becoming the leading bank for technology finance in the new development stage.
+Technology Finance
+In 2021, the Bank's efforts towards the "Eight Priority Areas for Enhancing Financial Services
+Capabilities", namely technology finance, green finance, inclusive finance, cross-border finance,
+consumer finance, wealth finance, supply chain finance and county-level finance, bore rich fruit,
+allowing it to serve the real economy with improved quality and efficiency. The Bank's progress
+across all aspects is as follows:
+During the year, the Bank coordinated the COVID-19 response with business development to
+make sure that the 14th Five-Year Plan was well implemented. As a result, the plan has got off
+to a great start. Leveraging both domestic and international markets and resources, the Bank
+accelerated the efforts to foster a strategic development pattern with domestic commercial banks
+as the "One Mainstay" and globalisation and integration as the “Two Engines” in order to ensure
+smooth flows in the domestic economy and positive interplay between domestic circulation and
+international circulation. Adhering to its original aspiration of serving the real economy, the
+Bank continued to apply the new development philosophy fully, faithfully and comprehensively,
+in a precise and comprehensive manner. It also took necessary steps to deepen supply-side
+structural reform in the financial sector, with emphasis given to the development of the "Eight
+Priority Areas for Enhancing Financial Services Capabilities”. To embrace the digital era, it
+intensified the application of various technologies such as big data, cloud computing, artificial
+intelligence, block-chain and 5G mobile communications, as part of its efforts to accelerate
+digital transformation. Keeping bottom-line thinking firmly in mind, the Bank worked to advance
+its comprehensive risk management, build a stronger line of defence against risks, and mitigate
+risks and challenges, thus continuously improving the efficiency of its comprehensive risk
+management. The Bank strengthened the corporate culture fostering as a driver of good conduct
+outcomes, expanding common ground and the convergence of interests towards transformation
+and reform.
+Overview of Strategic Progress
+BUSINESS REVIEW
+42
+Net cash flow from investing activities was an outflow of RMB395.561 billion, an increase of
+RMB378.495 billion compared with the prior year. This was mainly attributable to a decrease in
+proceeds from disposal/maturity of financial investments and an increase in purchase of financial
+investments compared with the prior year.
+Net cash flow from financing activities was an inflow of RMB74.344 billion, a decrease of
+RMB52.273 billion compared with the prior year. This was mainly attributable to a decrease in
+proceeds from issuance of bonds compared with the prior year.
+Segment Reporting by Geography
+From a geographic perspective, the Group operates in three principal regions: the Chinese
+mainland; Hong Kong (China), Macao (China) and Taiwan (China); and other countries and
+regions. From a business perspective, the Group provides financial services through six main
+business segments: corporate banking, personal banking, treasury operations, investment banking,
+insurance and other operations.
+A geographical analysis of profit contribution and related assets and liabilities is set forth in the
+following table:
+In 2021, the Bank closely followed national strategies, keenly sharpened its market positioning
+and comparative advantages, formulated the Group's 14th Five-Year Plan, and made every effort
+to push forward high-quality development.
+In 2021, net cash flow from operating activities was an inflow of RMB843.258 billion, an
+increase of RMB770.230 billion compared with the prior year. This was mainly attributable to a
+net increase in due to banks and other financial institutions, and a net decrease of due from and
+placements with banks and other financial institutions as compared to a net increase in the prior
+year.
+2021
+Hong Kong (China),
+6,637 (2,548)
+5,129
+73,807
+72,855
+2020
+Group
+2021
+425,142 415,918
+15,365
+15,183
+34,053 37,560
+2020
+Unit: RMB million
+Elimination
+2021
+in the start-up and growth stage, evolving its available products from bank credit to
+comprehensive financial services, and refining its risk system from traditional modes to
+become more adaptive to scientific and technological innovation. As at the end of 2021,
+comprehensive technology finance support exceeded RMB1.26 trillion, including over
+RMB820.0 billion* credit support to nearly 36,000 customers, more than RMB130.0 billion
+capital input such as equity investment, bond investment and leasing, and more than
+RMB300.0 billion non-capital input such as undertaking and asset management. The number
+of outlets offering technology finance services grew to 93.
+2020
+regions
+Taiwan (China)
+2021
+2020
+Chinese mainland
+2021
+375,906 362,993
+105,139 73,641
+Net interest income
+Non-interest income
+Items
+Other countries and
+Other Financial Information
+2020
+Developing featured products and services. The Bank conducted in-depth research
+on high-tech industries, explored innovative business models for credit granting and
+implemented differentiated risk management systems, thus improving the financing
+experience for technological enterprises. It developed unique products for scientific and
+technological innovation, provided featured products and services such as option loans
+and intellectual property pledge financing for technology companies, and facilitated high-
+quality business linkages between commercial and investment banks. The Bank built
+a comprehensive spectrum of financial products, providing full-lifecycle services for
+technological enterprises and all-round financial support for technological practitioners.
+The Bank has put a sound internal control mechanism for fair value measurement in place.
+In accordance with the Guidelines on Market Risk Management in Commercial Banks, the
+Regulatory Guidelines on Valuation of Financial Instruments in Commercial Banks, CAS and
+IFRS, with reference to the New Basel Capital Accord, and drawing on the best practices of
+leading international banks regarding valuations, the Bank formulated the Valuation Policy
+of Financial Instrument Fair Values of Bank of China Limited to standardise the fair value
+measurement of financial instruments and enable timely and accurate financial information
+disclosure. Please refer to Note VI.5 to the Consolidated Financial Statements for more detailed
+information related to the fair value measurement.
+Including national high-tech enterprises and technology-based small and medium-sized enterprises.
+M
+Leading innovation in cross-border financial services. The Bank enriched and improved
+product and service solutions for new trade patterns such as cross-border e-commerce,
+market procurement trade and comprehensive foreign trade service platforms. The Bank
+upgraded the "BOC Cross-border E-commerce" to achieve full coverage of cross-border
+e-commerce including import and export scenarios, as well as local and foreign currency
+transactions. Connected to the market procurement trade information platform in the pilot
+areas and launch "BOC Cross-border E-market-procurement" to provide convenient online
+collection and settlement of foreign exchange for market procurement trade. The Bank built
+a comprehensive financial service system for new foreign trade forms, thus supporting the
+high-quality development of new foreign trade forms and models. TradeGo commodity
+blockchain platform was jointly established with key stakeholders in the commodity
+industry to improve the circulation efficiency of commodity trade. Furthermore, the Bank
+continuously improved the innovative products such as online foreign exchange purchase
+and remittance for studying abroad and reservation of foreign currency change. The Bank
+upgraded its foreign currency cash reservation service, to cover major cities in the Chinese
+mainland via multiple channels such as mobile banking, WeChat banking and online
+banking. The service was integrated into platforms such as China's online government
+affairs service platform, HUAWEI HarmonyOS and JegoTrip APP. The Bank also expanded
+special cross-border businesses and opened 167 thousand accounts via the BOCHK's
+"Greater Bay Area Account Opening" service in the Guangdong-Hong Kong-Macao Greater
+Bay Area.
+47
+M
+Enhancing the brand value of cross-border finance. Acting as a strategic partner,
+the Bank successfully served and supported major exhibitions such as the 4th China
+International Import Expo (CIIE), the 2021 China International Fair for Trade in Services
+(CIFTIS), the 129th and 130th China Import and Export Fair ("Canton Fair”), the 1st China
+International Consumer Products Expo (CICPE), and the 21st China International Fair for
+Investment & Trade (CIFIT). Fully leveraging the advantages arising from its globalised
+operations, the Bank assisted in attracting investment and exhibition activities and provided
+comprehensive financial service solutions to facilitate the matchmaking of trade and
+investment, in order to build a financial services bridge for foreign trade and economic
+cooperation.
+Consumer Finance Business
+Adhering to digital drivers, structural optimisation, overall risk control and effective development
+synergies, the Bank focused on strengthening capacity building, optimised the customer
+experience and bolstered its sound reputation. It achieved a market-leading position in consumer
+finance products, realised rapid growth in consumer finance business and highlighted the overall
+role of consumer finance as a growth driver, thus contributing to the high-quality development of
+the Group.
+Improving the product system. The Bank leveraged its advantages in group-level
+coordination and capitalised on the effective synergies of its personal loan, credit card and
+consumer finance businesses to create multi-category consumer finance product system that
+covers customers across the entire life-cycle.
+Consolidating competitive advantages in cross-border finance. Giving full play to
+the Bank's role as the main channel of financial services for foreign trade and economic
+cooperation, the Bank's institutions in the Chinese mainland realised rapid growth in the
+volume of international settlement and cross-border RMB settlement. The Bank's cross-
+border customers continued to grow in size and maintained the leading position in the
+industry in terms of international trade settlement, cross-border RMB settlement, cross-
+border guarantee and cross-border cash pool business. The Bank firstly launched a pilot
+business for the integrated cash pooling of local and foreign currencies in Shenzhen and
+Beijing, and completed the first business transaction under the China-Indonesia Local
+Currency Settlement mechanism. It maintained a leading position in terms of personal cross-
+border business income, foreign currency personal deposits and the market share of foreign
+currency exchange against RMB. The Bank was also approved among the first to launch the
+Cross-boundary Wealth Management Connect scheme. As at the end of 2021, the Bank held
+a market share more than 60% for the total number of WMC Northbound and Southbound
+subscribers.
+Accelerating digital transformation. The Bank continuously strengthened the data
+application and improved the model effectiveness in an effort to accelerate the pace of
+digital transformation in its consumer finance business. By actively developing integrated
+scenarios and closely following customers' livelihood and consumption demands, the
+Bank provided a variety of consumer finance products covering clothing, food, shelter,
+transportation, medical care, learning, tourism and entertainment. As at the end of 2021, the
+Bank's commercial banks in the Chinese mainland had achieved a leading position in RMB
+consumer loans. The growth rate of the Bank's credit card instalment transaction volume
+outperformed the market and achieved a steady increase in market share. BOC Consumer
+Finance has grown rapidly and secured a leading position in the industry in terms of
+comprehensive competitiveness.
+48
+Wealth Finance Business
+The Bank actively implemented the national strategy of "common prosperity". Based on "One
+Mainstay, Two Engines" strategy, it served as a display window for personal wealth finance
+services and pushed forward the high-quality development of the wealth finance business.
+Highlighting platform-based operation and asset allocation. The Bank built “Group-
+wide + Market-wide" product open shelf and launched the “BOC Selection" fund brand.
+Focusing on asset allocation concepts and services, the Bank optimised its “Investment
+Strategy Portfolio" service to help the customers diversify their asset allocation and increase
+non-salary yields. As at the end of 2021, the balance of agency sales of personal customers'
+wealth management products increased by 75.30%, and the scale of asset allocation products
+exclusive to private banking, such as fund-of-funds and tailored asset management products
+for individual HNW clients, grew by 246.50% compared with the prior year-end.
+Highlighting specialised and digitalised operations. With the aim of delivering high-
+quality professional services, the Bank built an investment strategy information service
+system and published the BOC White Paper on Personal Banking Global Asset Allocation
+for the fourth consecutive year, with annual portfolio returns far surpassing comparable
+benchmarks over the previous two years. In addition, it intensified team building in a
+bid to improve customer reach and professional service quality. With a focus on digital
+empowerment, the Bank sped up building its digital channel system and optimised digital
+marketing and mobile service tools. As at the end of 2021, the Bank's medium to high-end
+customer base grew at the fastest pace among that of the past three years, and its private
+banking customer base had reached 147,300.
+Highlighting globalised and integrated operations. Focusing on the key customer groups
+of entrepreneurs, the Bank leveraged the Group's advantages in integrated operations to
+boost service synergies. It further developed family trust services and the number of family
+trust service customers grew by 82% compared with that at the prior year-end. It accelerated
+building the Asia-Pacific private banking platform and enhanced its service capacity for
+"private banking + investment banking + commercial banking”, thus improving its high-end,
+cutting-edge private banking services.
+49
+49
+48
+The Bank actively implemented the national strategy of high-level opening-up, fully leveraged
+the advantages of the "One Mainstay, Two Engines" strategy, and adopted differentiated
+development tactics for key customers, key products and key regions. Based on its cross-border
+scenario-based financial service ecosystem, the Bank reinforced its leading position for cross-
+border banking services with prominent features and advantages.
+Cross-Border Finance
+46
+44
+M
+Green Finance
+The Bank achieved leapfrogging progress in green finance in strict adherence with the national
+development goals of "carbon peaking and carbon neutrality”, and integrated itself into global
+green governance, building the bank of first choice for green finance.
+Rapid growth in green credit. At the end of 2021, the Bank's domestic green credit
+balance reached RMB 1,408.6 billion according to CBIRC statistics, a year-on-year increase
+of 57%. The Bank participated in landmark projects such as the Dogger Bank Wind Farm,
+which is the world's largest offshore wind power project currently under construction.
+The Bank ranked first among Chinese banks in Bloomberg's Global Green Loans and
+Sustainability-Linked Loan list in 2021.
+A leading position in the green bond market. The Bank issued the world's first publicly
+offered Transition Bonds in financial institutions, the world's first Biodiversity Themed
+Green Bonds in financial institutions, and the world's first Sustainability Re-Linked Bond,
+while the cumulative amount of overseas green bonds issuance reached USD10.7 billion
+equivalent. During 2021, the Bank underwrote domestic and overseas green bonds for
+RMB129.4 billion and USD23.4 billion equivalent respectively. The Bank ranked the first in
+NAFMII's List of Investors in Green Debt Financing Instruments in 2021.
+Abundant and diversified green products and services. The Bank opened a Chinese
+Certified Emission Reduction (CCER) registration account and launched a range of
+emission products and services to comprehensively address and support customers' low-
+carbon transformation requirements. These included loans secured against renewable energy
+subsidy rights, carbon emission allowance collateral loans, "Inclusive Loan for Low-
+Carbon Development” inclusive green services, the first batch green and low-carbon themed
+personal UnionPay platinum card, the retail green and new energy vehicle instalment, the
+personal green mortgage loan, the carbon emission registration and settlement services,
+and other green products related to funds, wealth management, deposits, leasing, insurance,
+supply chain finance, custody and equity investment.
+Sustainable finance collaboration. In 2021, the Bank signed the UN Principles for
+Responsible Banking (PRB), became a supporting institution for the Task Force on Climate-
+related Financial Disclosures (TCFD) and solidly took up its duties. Furthering local and
+international collaboration, the Bank participated in the organising activities of the 15th
+Conference of the Parties of the Convention on Biological Diversity (COP15) and the 26th
+Conference of the Parties of the United Nations Framework Convention on Climate Change
+(COP26).
+Green finance capacity building. During the year, the Bank established the BOC Green
+Finance Academy, compiled the Basic Knowledge on Green Finance of Bank of China
+Training Manual, set up digitalised green finance cloud learning platform, held a number
+of multi-tiered online and offline training sessions on green finance, and formulated green
+finance talent training plan in the 14th Five-Year Plan of BOC for Talents.
+45
+Inclusive Finance
+The Bank treats inclusive finance as a strategic business and fulfils its mission as a large
+state-owned bank by focusing on serving the real economy and promoting the high-quality
+development of inclusive finance.
+Improving the quality and coverage of inclusive finance services. As at the end of 2021,
+the Bank's outstanding inclusive finance loans granted to micro and small-sized enterprises
+reached a record high of RMB881.5 billion, an increase of 53.15% compared with the prior
+year-end, outpacing the growth rate of the Bank's total loans. The number of micro and
+small-sized customers stood at nearly 620,000, higher than the beginning of the year. The
+average interest rate of new inclusive finance loans to micro and small-sized enterprises
+was 3.96%. The Bank established an inclusive finance outlet system and advanced the
+development of its inclusive finance outlets.
+Accelerating the digital transformation of inclusive finance services. With a view to
+build a business model that integrates online and offline services and ensures a sufficient
+supply of online products and diversified application scenarios, the Bank improved its
+system of online products and services for inclusive finance, which comprised of five
+product series: “Unsecured Loan”, “Bank Tax Loan", "Mortgage Loan”, “Business Loan"
+and "Tax Loan". Its online inclusive finance products won a gold award for "Special Field
+Innovation” in the Digital Finance and FinTech Innovation Competition, as well as the
+"FinTech Award” and “Mobile Banking Award" at the Asia-Pacific Bank Digital Innovation
+Expo. Moreover, the Bank upgraded and improved its credit factory model so as to fully
+realise the capacity of its offline businesses, and created a dynamic environment in which
+online and offline channels mutually reinforce each other's progress.
+Developing featured products and services. The Bank developed its “Inclusive Loan"
+which is an inclusive finance brand and established a product system comprised of eight
+product series that covers more than 50 sectors. It launched product and services such as
+"New Year Benefit" and the "MSE Benefit Loan" etc. Efforts were made to build a new
+ecosystem for intellectual property finance, and carve out a position as the preferred bank
+for intellectual property financing services. The Bank improved its services for “specialised,
+refined, featured and innovative” enterprises and supported the development of key
+enterprises. In addition, the Bank improved cross-border matchmaking services and served
+a number of important national economic and trade events. As at the end of 2021, the Bank
+has held 89 matchmaking events for enterprises, providing value-added financial services
+featuring “financing + intelligence” for more than 40,000 enterprises from 126 countries and
+regions worldwide.
+(Please refer to the section "Inclusive Finance" for detailed information about inclusive finance.)
+5
+(2,356)
+Inclusive finance loans granted to micro and small-sized enterprises are measured in accordance with the Notice
+of the General Office of China Banking and Insurance Regulatory Commission on Further Promoting the High-
+quality Development of Financial Services for Micro and Small-sized Enterprises in 2021 (Yin Bao Jian Ban Fa
+[2021] No. 49).
+Continuing to deepen cooperation with governments. The Bank has established strategic
+cooperative relations with the Ministry of Science and Technology, the Ministry of Industry
+and Information Technology, China National Intellectual Property Administration and China
+Association for Science and Technology, reaching consensus on various aspects including
+collaborative efforts to support national strategic scientific and technological strengths,
+deepen the service system for "specialised, refined, featured and innovative” enterprises,
+increase the application of scientific and technological achievements, and promote the
+popularisation of “science + finance".
+180,575 151,729
+Macao (China) and
+64,340 58,157
+347,243
+9,219
+Equity instruments
+102,268
+88,025
+14,243
+356,462
+Fund investments and other
+69,281
+33,631
+Loans and advances to customers at
+355,600
+363,637
+(8,037)
+102,912
+fair value
+Debt securities
+Financial assets at fair value through
+Critical Accounting Estimates and Judgements
+The accounting estimates and judgements made by the Group will generally affect the carrying
+amounts of assets and liabilities of the next financial year. These estimates and judgements
+are continually evaluated and are based on historical experience, expectations of future events
+that are believed to be reasonable under the circumstances and other factors. The management
+believes that the accounting estimates and judgements have properly reflected the Bank's
+operating environment. Please refer to Notes II and III to the Consolidated Financial Statements
+for more detailed information related to the Bank's accounting policies and accounting estimates.
+41
+Fair Value Measurement
+Movement of Financial Instruments Measured at Fair Value
+Unit: RMB million
+profit or loss
+As at
+31 December
+31 December
+Items
+2021
+2020
+Change
+As at
+Please refer to Note V.43 to the Consolidated Financial Statements for more detailed information
+related to the Group's other operating results and financial position in terms of geographic
+segments and business segments categories.
+Financial assets at fair value through
+Debt securities
+(3,831)
+3,669
+Due to customers at fair value
+(31,311)
+(25,742)
+(5,569)
+(162)
+Bonds issued at fair value
+(6,162)
+5,845
+Short position in debt securities
+(12,458)
+(17,912)
+5,454
+(317)
+other comprehensive income
+other financial institutions at fair value
+122,901
+2,363,078
+2,086,362
+276,716
+Equity instruments and other
+26,752
+Including: net fee and
+commission income
+Due to and placements from banks and
+5,324
+95,799
+171,738
+(75,939)
+Derivative financial liabilities
+(89,151)
+(212,052)
+Derivative financial assets
+100.00%
+21,428
+100.00%
+218,529 188,740 45,845 50,250 12,188
+7,388
+58
+As at the year-end
+Assets
+Liabilities
+276,620 246,378
+Profit before income tax
+21,491,846 19,454,269 4,625,924 4,306,679 2,292,838 2,090,165 (1,688,200) (1,448,454) 26,722,408 24,402,659
+19,607,634 17,753,122 4,230,215 3,917,100 2,222,113 2,017,915 (1,688,107) (1,448,315) 24,371,855 22,239,822
+3 The figures for segment assets, segment profit before income tax and their respective proportions are prior to
+intragroup elimination.
+40
+Total assets of the Hong Kong (China), Macao (China) and Taiwan (China) segment amounted
+to RMB4,625.924 billion, an increase of RMB319.245 billion or 7.41% compared with the prior
+year-end, representing 16.28% of the Group's total assets. In 2021, this segment recorded a profit
+before income tax of RMB45.845 billion, a decrease of RMB4.405 billion or 8.77% compared
+with the prior year, representing 16.58% of the Group's profit before income tax.
+Total assets of the other countries and regions segment amounted to RMB2,292.838 billion,
+an increase of RMB202.673 billion or 9.70% compared with the prior year-end, representing
+8.07% of the Group's total assets. In 2021, this segment recorded a profit before income tax of
+RMB12.188 billion, an increase of RMB4.800 billion or 64.97% compared with the prior year,
+representing 4.41% of the Group's profit before income tax.
+Operating income for the main business segments of the Group is set forth in the following table:
+Unit: RMB million, except percentages
+There are no differences in the equity and profit for the year of the Group prepared in accordance
+with IFRS to those prepared in accordance with CAS. Please refer to Supplementary Information
+I to the Consolidated Financial Statements for detailed information.
+As at the end of 2021, total assets³ of the Bank's Chinese mainland segment amounted to
+RMB21,491.846 billion, an increase of RMB2,037.577 billion or 10.47% compared with the
+prior year-end, representing 75.65% of the Group's total assets. In 2021, this segment recorded
+a profit before income tax of RMB218.529 billion, an increase of RMB29.789 billion or 15.78%
+compared with the prior year, representing 79.01% of the Group's profit before income tax.
+2020
+(104,220) (119,016)
+(6,413)
+567,647
+14,480
+14,662
+3,959
+Operating expenses
+(163,673) (140,087) (57,445)
+-
+(56,479)
+4,135 (1,353)
+(8,201) 2,606 2,356
+(1,432) 81,426 75,522
+(226,355) (202,411)
+Impairment losses on assets
+(99,622) (107,622) (4,317) (4,981)
+(281)
+(7,843)
+Items
+2021
+% of total
+67,886
+11.96%
+Investment banking and insurance
+45,122
+7.45%
+41,017
+17.82%
+Others and elimination
+5.38%
+19,520
+3.44%
+Total
+605,717
+Amount
+32,554
+107,937
+7.23%
+39.04%
+Amount % of total
+Treasury operations
+528,041
+87.17%
+89.33%
+Including: Corporate banking
+203,654
+507,110
+33.62%
+217,590
+38.33%
+Personal banking
+216,450
+35.73%
+221,634
+Commercial banking business
+46.50%
+186,956
+43.58%
+Personal banking business
+199,157
+42.43%
+199,508
+37.64%
+10,191
+83,336
+17.76%
+41,763
+9.73%
+Others
+2.17%
+806
+176,662
+Treasury operations
+Corporate banking business
+Focusing on the eight key industries of new energy, new materials, new infrastructure,
+modern agriculture, bio medicine, high-end equipment, information and communication, and
+transportation, as well as the five major areas of green and low-carbon, medical and health,
+equipment manufacturing, people's livelihood consumption and cross-border trade, the Bank
+stepped up its support for national key areas such as strategic emerging industries, advanced
+manufacturing, and modern service industries. In 2021, the Group comprehensively utilised
+corporate credit, trade finance, negotiable instruments, bonds and other financial instruments
+to provide RMB2.16 trillion of liquidity support to core supply chain enterprises.
+% of total
+50
+Д
+Supply Chain Finance
+The Bank gave full play to its advantages in globalised, integrated and specialised operations to
+promote the development of digitalised, platform-based, scenario-based and intelligent supply
+chain finance, and spared no efforts to build itself into a first-class global bank for supply chain
+financial services.
+During the 2021 CIFTIS, the Group launched the new supply chain finance brand “BOC
+Smart Chain" and four industry sub-chains, namely "BOC Medical Chain", "BOC Auto
+Chain", "BOC Equipment Chain” and “BOC Construction Chain", to meet the individual
+needs of customers in different industries for supply chain finance. Through its own
+supply chain finance platform, core enterprise platform and third-party platforms, the Bank
+provided all-rounded online supply chain financial services for core enterprises and their
+upstream and downstream enterprises.
+0.19%
+Relying on the supply chain financial service system covering domestic and overseas
+operation, local and foreign currency, online and offline channel, the Bank strengthened
+financing support for enterprises in the upstream and downstream of the supply chain. It
+launched a batch customer marketing model named “Inclusive Loan for Supply Chain"
+aiming at upstream and downstream inclusive customer group, and successfully underwrote
+asset-backed securitisation products for a number of core supply chain customers.
+County-level Finance
+The Bank focused on key customers and businesses at the county level to address the changing
+development needs of the real economy in county areas. It accelerated improvements to local
+financial services infrastructure and explored the construction of a digitalised, scenario-driven,
+platform-based and featured county-level financial service model.
+Improving the county-level financial service system. Drawing on the strength of its
+globalised operations, the Bank leveraged the BOC E-cooperation matchmaking platform
+to help county-level industries in terms of "Going Out” and “Bringing In”. It also
+strengthened and improved the integration of its operations so as to provide diversified and
+comprehensive financial services.
+Building diversified county-level service channels. With a focus on the development
+of online channels, the Bank intensified its efforts to extend online and mobile banking
+services while continuing to optimise its offline channels. In 2021, 40 new county-level
+institutions were opened, serving 17 counties where no offline financial service channels
+were previously available.
+Launching new financial products to support “agriculture, rural areas and farmers".
+The Bank surpassed the original ambitions of its agriculture-related loan plan which
+effectively promoted poverty alleviation and rural revitalisation. It enriched the product
+and service system of "Rural Revitalisation - Prosperity Loan", launched products such as
+Farmland Loan, Xinnong Loan and Huinong Loan and participated in the "Credit Express"
+programme of the PRC Ministry of Agriculture and Rural Affairs to advance the high
+quality development of rural revitalisation.
+51
+Commercial Banking in the Chinese Mainland
+Actively serving national strategies, the Bank honed its market positioning and comparative
+advantages in the domestic circulation as well as in the interplay between domestic and
+international dual circulations, formed synergies and stimulated momentum. The Bank's
+commercial banking in the Chinese mainland has made steady progress, operating efficiency has
+risen steadily, and the primary role of a domestic commercial bank has been further highlighted.
+In 2021, the Group's commercial banking business in the Chinese mainland achieved an
+operating income of RMB469.346 billion, an increase of RMB40.313 billion or 9.40% compared
+with the prior year. Details are summarised in the table below:
+Unit: RMB million, except percentages
+2020
+2021
+Items
+Amount
+Amount % of total
+Total
+55
+100.00%
+94
+The Bank was recognised as "Best Transaction Bank for Trade Finance” and “Best Transaction
+Bank for Supply Chain Finance" by Asiamoney, and “Best Trade Finance Bank" and "Best
+Renminbi Bank" by The Asset. It received a special award for "Electronic Letter of Credit
+Information Exchange System" from China Financial Publishing House, and "BOC Global Cash
+Management" was selected as a case study for "Global Service - Global Service Practice Cases"
+at the China International Fair for Trade in Services, demonstrating the Bank's professional
+advantages in transaction banking.
+Inclusive Finance
+Implementing national policy measures to support the development of micro and small-sized
+enterprises, the Bank constantly promoted the development of inclusive finance in line with
+relevant regulatory requirements. It continued to improve its inclusive finance services by
+focusing on the overall requirements of “increasing volume, expanding coverage, improving
+quality, promoting efficiency”. Taking product innovation as its key breakthrough driver, model
+upgrading as its basis and digitalised inclusive finance as its objective, the Bank developed a
+service model that integrates online and offline services and made every effort to build the BOC
+inclusive finance brand to improve the quality and efficiency of its inclusive finance services. It
+successfully upgraded its credit factory model, optimised the credit management mechanism for
+corporate customers, strengthened model-based, intelligent, automatic and batch-based operation,
+and improved its agile response capabilities. By replicating the credit factory model in Macao
+(China), it supported SMEs in Macao (China) to integrate into the overall national development.
+The Bank strengthened financial support for key sectors through its “Inclusive Loan” inclusive
+finance brand. It also developed a service system for "specialised, refined, featured and
+innovative" enterprises, providing credit support to more than 15,000 such businesses. It
+carried out a special campaign promoting “BOC Inclusive Services for Specialised, Refined,
+Featured and Innovative Enterprises”, and hosted the first cross-border matchmaking event for
+"specialised, refined, featured and innovative” SMEs. In addition, the Bank signed a strategic
+cooperation agreement with China National Intellectual Property Administration (CNIPA) to
+establish the Innovative Intellectual Property Financing Laboratory and released the "Inclusive
+Loan for Intellectual Property”, an intellectual property pledge loan product. Through special
+marketing activities such as "Campus Enterprise Benefit Plan”, “Enterprise Benefit Plan"
+and "Elite Benefit Plan", the Bank provided comprehensive financial services for micro and
+small-sized enterprises, including lectures on intellectual property investment and financing,
+inclusive finance knowledge, etc., which also served as an excellent growth platform to boost
+entrepreneurship and innovation among college students.
+57
+52
+In response to the national policy of "staying local for the Spring Festival", the Bank launched
+the "New Year Benefit” financial service programme to provide financial services to those micro
+and small-sized enterprises and their employees that continued working over the Spring Festival
+to ensure supply and stabilise production, with more than 7,500 customers benefiting from the
+service. To implement the loan policy of promoting “borrowing and repayment at any time”,
+the Bank launched the “MSE Benefit Loan” to provide flexible financing services to micro and
+small-sized enterprises. It launched and upgraded the “BOC E-cooperation” intelligent matching
+platform and built an integrated “online + offline” bank-government-enterprise ecosystem. As the
+sole invited financial institution, the Bank joined with the Ministry of Commerce to carry out the
+"Business Integrity Publicity Month” campaign. Based on the theme of “Strengthening Business
+Integrity with Financial Services", it prepared and promoted the “BOC Business Integrity Credit"
+scheme to provide targeted support for enterprises with good commercial credit records.
+56
+Pension Business
+Focused on implementing the comprehensive digital transformation objectives set forth in the
+Group's 14th Five-Year Plan, the Bank emphasised improving the digitalisation of corporate
+banking in three aspects: digital transformation, globalised operations and comprehensive
+services. By carrying forward the Group's four core digitalisation projects and relying on
+the OASIS project to promote the transformation of the corporate banking business, it built
+a customer marketing mode based on collaboration between the Bank and the Group's
+comprehensive operation companies as well as cooperation among different positions within the
+various institutions that comprise the corporate banking global service platform. It also realised
+intelligent post-lending management, strengthened data analysis and improved the application of
+data elements in marketing, risk control and management.
+58
+58
+Personal Banking
+Guided by its customer-centric philosophy, the Bank continued to shape its retail banking
+business into one with wealth finance as its core, cross-border finance and consumer finance as
+its features, and key regions as its breakthrough drivers. It remained committed to bolstering its
+development momentum, comprehensively accelerated digital transformation, deeply promoted
+the reform of its management model, and unlocked the value of structural reform in order to
+drive the high-quality development of its personal banking business. In 2021, the Bank's personal
+banking business in the Chinese mainland realised an operating income of RMB199.157 billion.
+Account Management Business
+Upholding the concept of “finance for the people", the Bank solidly promoted the use of smart
+accounts and made remarkable achievements in the comprehensive reform of its cardless personal
+banking services. It completed the R&D phase of its "digital debit card" and put it into pilot
+operation. Services such as account opening, cash deposit and withdrawal, transaction record
+printing, foreign currency exchange and investment and wealth management can now be provided
+without the customers presenting their card. The Bank created a brand-new service model that
+features "accounts and mobile banking as one" and extended its cardless services to cover all
+high-frequency scenarios. The Bank also worked to enrich products and services for elderly
+customers and launched "BOC Care Debit Card" for customers with wealth inheritance needs,
+based on the functionality of principal and supplementary debit cards, enabling the sharing
+of family funds and wealth inheritance. As the only official banking partner of both Winter
+and Summer Olympic Games, the Bank made preparations to promote a Winter Olympics
+themed debit card to cross-border customers and provided services such as account opening,
+mobile payment, local and foreign currency cash, e-CNY and domestic acceptance of overseas
+bank cards for short-term visitors to China during the Winter Olympics, thus enhancing the
+convenience of domestic payment and settlement. It optimised its personal accounts service,
+introduced easy personal account opening services, and established a classified and tiered
+management system for personal accounts to effectively prevent telephone and internet fraud
+risks. The Bank was awarded “Retail Bank with Excellent Competitiveness” by China Business
+Journal, while its “Comprehensive Cardless Application of Personal Banking Business and Smart
+Counter 4.0” programme was recognised as the “2021 Best Frictionless Customer Experience
+Initiative in China" by The Asian Banker.
+59
+Digital Transformation
+469,346
+The Bank actively improved its product and service system and enhanced the quality and
+efficiency of its services for the real economy. It piloted a unified corporate settlement account
+system for local and foreign currencies and improved its account, payment and settlement
+services so as to continuously enhance multi-channel account services. In response to policy
+guidance, it took multiple measures to optimise account services for micro and small-sized
+enterprises and provided them with an "easy account opening" service to help improve the
+business environment. The Bank devoted great efforts to promoting the expansion of supply chain
+finance, vigorously supported SME financing, and deepened innovation in supply chain finance
+service solutions for key industries. Meanwhile, the Bank successfully expanded its "blockchain
++ supply chain” service solution in medical scenarios and launched a policy finance application
+scenario on the cross-border finance blockchain platform of the State Administration of Foreign
+Exchange in many provinces and regions. It also enriched and improved the comprehensive
+product system of its “Global Cash Management Platform+” and launched the innovative "BOC
+Intelligent Funds Supervision Service" product to provide customers with integrated and multi-
+scenario fund supervision solutions. In addition, the Bank launched a multi-bank cloud service
+platform to provide standardised fund management services, and piloted an integrated cash pool
+of local and foreign currencies in Shenzhen and Beijing. It also successfully rolled out an RMB
+Cross-border Interbank Payment System (CIPS) standard transceiver product and completed its
+first RMB international remittance business via CIPS.
+The Bank continuously advanced RMB internationalisation. It served as the main channel for
+RMB cross-border flows and acted as a market leader in service innovation. In 2021, the Group's
+transaction volume of cross-border RMB payment reached RMB11.26 trillion, up 22.36%
+compared with the prior year, of which the Bank's institutions in the Chinese mainland settled
+RMB8.41 trillion, an increase of 24.45% compared with the prior year, thus maintaining the
+largest market share. The number of cross-border RMB business customers served by the Bank's
+institutions in the Chinese mainland increased by nearly 24% compared with the previous year.
+The Bank continuously expanded its cooperation efforts in Local Currency Settlement based on
+the cross-border use of RMB, including transacting the first business under the China-Indonesia
+Local Currency Settlement mechanism, maintaining a leading position in the industry in terms of
+exchange volume and settlement scale. It also continued to publish the BOC Cross-border RMB
+Index (CRI), BOC Offshore RMB Index (ORI) and the White Paper on RMB Internationalisation,
+providing global customers with strong, comprehensive and professional support to understand
+429,033
+100.00%
+Corporate Banking
+With a focus on high-quality development, the Bank continued to advance the transformation of
+its corporate financial services so as to serve the real economy more efficiently and effectively.
+It gave priority to supporting high-quality development in key areas such as technology
+finance, green finance, inclusive finance, supply chain finance, county-level finance, strategic
+emerging industries and manufacturing, thus contributing to the transformation and upgrading
+of the national economy. It also proactively expanded core customer groups in the advanced
+manufacturing and digital economy-related industries, so as to help improve the country's
+strategic scientific and technological strengths. In addition, the Bank accelerated progress in
+the development of the Beijing-Tianjin-Hebei region, Xiongan New Area, the Yangtze River
+Delta, the Guangdong-Hong Kong-Macao Greater Bay Area, Hainan Free Trade Port and other
+key areas by virtue of its financial resources, thus supporting national strategies for coordinated
+regional development. Centring on customers' needs and experience, the Bank accelerated the
+growth of customer assets under management (AUM), closely cooperated with its comprehensive
+operation companies, and implemented differentiated precision marketing based on refined
+customer group classification. It also promoted the management of financial product aggregates
+(FPA), strengthened linkages and coordination by giving full play to the advantages of the
+Group's comprehensive operations, and provided integrated service solutions covering the whole
+product line of “investment, loans, bonds, equity, insurance and leasing” to meet the diversified
+financing needs of all customers. In 2021, the Bank's corporate banking business in the Chinese
+mainland realised an operating income of RMB176.662 billion.
+52
+Corporate Deposits
+Upholding its customer-centric approach, the Bank continued to consolidate its development
+foundations and remained committed to building a comprehensive and tiered marketing
+management system through scientific classification and targeted policy implementation.
+Focusing on customers' diversified financial needs, it further enhanced its cross-industry services,
+comprehensive marketing awareness and comprehensive service capabilities. Furthermore, by
+proactively integrating into the domestic and international dual circulations, the Bank strived
+to connect its business product channels for domestic settlement and international settlement,
+increased business volumes in payments and settlements, enhanced fund retention capacity,
+and boosted the sound and sustainable development of its deposit business. Centring on the key
+industries and key customer groups of the administrative institutions sector, the Bank developed
+differentiated marketing strategies and sharpened its market competitiveness in key areas by
+improving scenario-based marketing across the entire industrial chain so as to assist the digital
+transformation of administrative institutions sector customers. As at the end of 2021, RMB
+corporate deposits in the Bank's operations in the Chinese mainland totalled RMB6,948.925
+billion, an increase of RMB495.437 billion or 7.68% compared with the prior year-end. Foreign
+currency corporate deposits amounted to USD117.085 billion, an increase of USD31.108 billion
+or 36.18% compared with the prior year-end.
+Corporate Loans
+and use RMB.
+The Bank fully implemented the national development strategy and the national goal of “ensuring
+stability on six fronts and security in six areas”, adhered to the general principle of “pursuing
+progress while ensuring stability” and increased its investment in high-quality credit, effectively
+improving its services to the real economy. The Bank devoted itself to the development of the
+modern industrial system; backed efforts to bolster the nation's strategic strengths in science
+and technology; and actively promoted a shift in service focus from traditional industries to
+new industries, new business forms and new business models. It strived to promote the nation's
+coordinated regional development strategy, supporting industrial upgrading and transfer as well
+as the development of city clusters in the Beijing-Tianjin-Hebei region and Xiongan New Area.
+The Bank also increased its investment in the advanced manufacturing sector, high-quality
+service sector, new infrastructure construction, new urbanisation and other sectors in the Yangtze
+River Delta, and vigorously seized the opportunities arising from the technology finance, industry
+finance and cross-border finance sectors of the Guangdong-Hong Kong-Macao Greater Bay Area.
+The Bank adopted policies tailored to local conditions and pursued accelerated development
+in the ecological protection of the Yellow River basin, the development of modern agriculture
+and animal husbandry, new urbanisation, infrastructure connectivity, and the upgrading and
+transformation of traditional industries. It further stepped up its efforts to promote the financial
+connectivity in the Chengdu-Chongqing economic circle, and energetically supported new forms
+of consumption. In addition, the Bank contributed to the development of the Hainan Free Trade
+Port and Smart Hainan, positioning itself as the first-choice bank for the port. To serve the
+national strategy of expanding domestic demand, it capitalised on the new trend of consumption
+upgrading and sped up the building of scenario ecosystems. To serve common prosperity for
+all, the Bank continuously strengthened its inclusive finance services and made breakthroughs
+in online products. It also actively integrated into the national rural revitalisation strategy and
+increased support for agricultural modernisation. To serve the nation's ecological conservation
+strategy, it further boosted the development of green finance and improved relevant products and
+services, which in turn helped the Bank to build a brand reputation for green finance. The Bank
+contributed to the high-quality opening-up of the Chinese economy by providing solid financial
+services to the Belt and Road initiative and strengthening Chinese enterprises” “Going Global"
+efforts and overseas economic and trade cooperation. As at the end of 2021, RMB corporate loans
+of the Bank's operations in the Chinese mainland totalled RMB7,123.647 billion, an increase of
+RMB867.375 billion or 13.86% compared with the prior year-end. Foreign currency corporate
+loans totalled USD51.675 billion, an increase of USD12.502 billion or 31.91% compared with the
+prior year-end.
+Financial Institutions Business
+The Bank continued to deepen all-round cooperation with various financial institutions and
+built up its integrated financial services platform, maintaining a leading position in terms of
+financial institution customer coverage. It has established correspondent relationships with about
+1,100 institutions around the world and opened 1,402 cross-border RMB clearing accounts for
+correspondent banks from 116 countries and regions, thus securing a leading position among
+domestic banks. It promoted the RMB Cross-Border Interbank Payment System (CIPS) and
+acted as an agent in the capacity of direct participant for 507 domestic and overseas financial
+institutions, seizing the largest market share among peers. It was awarded "Best Renminbi Bank"
+in the U.S. by The Asset, the first Chinese bank to win such an award. The Bank's custodian
+service for Qualified Foreign Investors (QFI) and its agency service for overseas central banks
+and other sovereign institutions held leading positions in the industry in terms of both customer
+base and business scale. The Bank helped the Shanghai Headquarters of China Central Depository
+& Clearing Co., Ltd. (CCDC) to transfer the proceeds from the first offshore bond issued by an
+overseas institution in the pilot free trade zone. It succeeded in winning the exclusive settlement
+bank for the centralised clearing of RMB-USD trades via Shanghai Clearing House. It also
+succeeded in convincing the China Foreign Exchange Trade System by its excellent service
+for sending and receiving agency instructions in relation to foreign currency lending business.
+It participated deeply in Southbound trading under the Bond Connect programme, further
+consolidated its leading position in the H-Share full circulation market, enhancing its brand name
+in serving the financial infrastructure clients. The Bank successfully held the 2021 Shanghai
+Global Asset Management Forum and the London & Shanghai Dialogue on Innovation and
+Cooperation in the Asset Management Industry to introduce investment opportunities in China's
+asset management market to global investors, receiving a positive market response. The Bank
+also strengthened its cooperation with the Asian Infrastructure Investment Bank (AIIB), the New
+Development Bank, Silk Road Fund, etc. It assisted AIIB with the issuance of offshore USD
+bonds, served as lead underwriter and bookrunner for the New Development Bank's pricing and
+issuance of two Panda bond issuances, and acted as lead underwriter and lead bookrunner for
+the issuance of Asian Development Bank's Panda bond. As at the end of 2021, the Bank had the
+largest market share in foreign currency deposits from financial institutions and led its peers in
+terms of market share increase for third-party funds under custody.
+54
+555
+Transaction Banking
+In response to digital transformation trends and customers' integrated financial needs, the Bank
+adhered to the three major development concepts of data standardisation, portfolio-based products
+and scenario-based services, and built a transaction banking product and service system featuring
+online and offline coordination, diverse scenarios, a satisfactory user experience and innovative
+and flexible portfolios, thus driving the steady development of its transaction banking business.
+Leveraging its role as the main financial services channel for foreign trade and economic
+cooperation, the Bank contributed to the smooth domestic and international dual circulations.
+In 2021, the Group's international settlement volume reached USD7.26 trillion, an increase of
+26.26% compared with the prior year. The Bank's institutions in the Chinese mainland registered
+USD3.32 trillion in international settlement volume, representing an increase of 38.9% compared
+with the prior year and securing the largest market share. It also provided import and export
+trade settlement services for nearly half of all enterprises holding import and export customs
+records nationwide. The Bank maintained its leading position among peers in cross-border
+guarantee business. It cooperated to complete the upgrading of SWIFT's guarantee messaging
+standards and the reform of customs duty guarantees. Vigorously supporting the development
+of new foreign trade forms, the Bank has introduced a number of measures to support the high-
+quality development of new forms and modes of foreign trade. The Bank upgraded the "BOC
+Cross-border E-commerce" product to include the function of collecting export proceeds for
+cross-border e-commerce enterprises, launched the "BOC Cross-Border E-Market-Procurement"
+product to support exports through the online collection of proceeds from market procurement
+programmes, and received approval for a cross-border e-commerce direct collection and exchange
+settlement service. Moreover, the Bank signed the Special Agreement on Supporting the High-
+Quality Development of New Forms and New Models of Foreign Trade with China Export &
+Credit Insurance Corporation, inputting funds to facilitate foreign trade enterprises to realise
+new momentum. As a strategic partner, the Bank gave full play to its advantages in globalised
+operations by actively supporting the smooth operation of major exhibitions such as the 4th
+CIIE, the 2021 CIFTIS, the 129th and 130th Canton Fair, the 1st CICPE and the 21st CIFIT. In
+addition, it provided all-round financial service solutions to facilitate the matchmaking of trade
+and investment, thus effectively expanding its influence.
+53
+The Bank provided a range of products including enterprise annuities, occupational annuities and
+employee benefit plans, and intensified efforts in the building of inclusive pension finance and
+other scenario-based financial services ecosystems, thus supporting the development of the silver
+economy on all fronts. As at the end of 2021, pension funds held in trust by the Bank reached
+RMB141.545 billion, an increase of RMB39.753 billion or 39.05% compared with the prior year-
+end. The total number of enterprise annuity individual accounts held by the Bank reached 3.6759
+million, an increase of 0.2623 million or 7.68% compared with the prior year-end. Pension assets
+under custody amounted to RMB783.502 billion, an increase of RMB 190.630 billion or 32.15%
+compared with the prior year-end. The Bank provided enterprise annuity services for more than
+16,000 institutional clients.
+50
+69
+Items
+Cumulative number of debit cards
+Cumulative number of credit cards
+2021
+Change (%)
+621.0535
+594.2693
+4.51%
+135.0722
+131.7439
+31 December
+2.53%
+cards with financial functions
+116.4572
+111.5483
+4.40%
+Balance of credit card loans
+496.299
+488.086
+1.68%
+2021
+Cumulative number of social security
+As at
+As at
+Unit: million cards/RMB billion, except percentages
+60
+The Bank accelerated the development of its private banking business. Adhering to the
+philosophy of professional and innovation-driven development, it provided high-net-worth
+customers with professional, comprehensive and globalised financial services. As at the end
+of 2021, the Group had 147.3 thousand private banking customers with RMB2.16 trillion of
+financial assets under management. Fully embracing the concept of asset allocation, the Bank
+deepened the research into global investment strategies and created a platform of private banking
+products held on consignment and drawn from all sections of the market. With a focus on the
+key customer group of entrepreneurs, the Bank researched and published the Report on Value of
+Wealth for Founders of Chinese Listed Companies. It made progress towards building its Asia-
+Pacific private banking platform and established an integrated service mechanism integrating
+corporate and personal business, domestic and overseas operations, and commercial banking
+and investment banking, thus forming a multi-layered private banking service system of “private
+banking + investment banking + commercial banking”. It further developed family trust services,
+improved insurance premium trust and charitable trust services, and established a family wealth
+management service ecosystem with the governance and inheritance of family enterprises at its
+core. The number of family trust service customers grew by 82% compared with the prior year-
+end. Moreover, the Bank further expanded the network of private banking centres in key cities by
+establishing 151 private banking centres in the Chinese mainland and rapidly cultivating teams
+of relationship managers, private bankers and investment advisors, thus continuously improving
+its professional private banking services. The Bank was awarded “Best National Private Bank
+in China" once again by Asian Private Banker, "Best private bank for international network”
+organised by Asiamoney, and "Stars of China-Best Private Bank" by Global Finance.
+Private Banking Business
+In line with the service concept of “scenario-based customer acquisition and payment financing”,
+the Bank's credit card business was fully integrated into its consumer finance scenarios.
+The Bank launched the "Family Consumption Reserve Fund" and supported large-amount
+consumption scenarios such as automobile purchase and home decoration through the “Head
+Office-headquarters" cooperation model. This model involves three product systems, namely
+automobile instalment, home decoration instalment and BOC E-instalment, which serves multiple
+scenarios, thus boosting consumption upgrading. As at the end of 2021, the Bank has now entered
+into "Head Office-headquarters” cooperation agreements with many automobile manufacturers
+and home decoration companies, covering more than 10,000 dealerships.
+the proportion of new non-housing loans to all new personal loans rose by 9.5 percentage points
+compared with the prior year.
+60
+In strict compliance with national policies, the Bank intensified its efforts to support residents'
+consumption and serve the real economy. It conscientiously put in place concentration
+management requirements for residential mortgage loans, strived to meet the reasonable demands
+of those who sought loans for house purchase, and maintained reasonable and steady growth in
+its residential mortgage business. Constantly advancing migration towards online mortgage loans,
+the Bank put into operation functions such as online order taking, online mortgage and online
+repayment. In addition, the Bank accelerated the development of its consumer loan business
+and targeted the needs of niche customer groups to build consumer loan brands such as "BOC
+E-Credit” and “Youth E-Credit”, thus enriching its consumer loan product system. Giving full
+play to its role as the only bank to provide government-sponsored loans to universities directly
+under the State Council and its institutions, it promoted the implementation of new policies on
+government-sponsored student loans. As at the end of 2021, the RMB personal loan balance
+of the Group's commercial banks in the Chinese mainland totalled RMB5,461.645 billion, an
+increase of RMB482.431 billion or 9.69% compared with the prior year-end. Within this increase,
+Consumer Finance Business
+Actively implementing the strategic requirements of pursuing “common prosperity”, the Bank
+upheld the concept of value creation and pressed ahead with reform and innovation, achieving
+sound development momentum in its wealth finance business. As at the end of 2021, the total
+financial assets under management of the Group's personal customers exceeded RMB11 trillion
+and the income generated from its wealth finance business increased by 33% compared with
+the prior year-end, achieving the highest growth rate of the last three years in terms of both
+customer numbers and financial assets under management for medium and high-end customers.
+Adhering to platform-based, allocation-oriented, specialised, digitalised, globalised and integrated
+development, the Bank built a “group-wide + market-wide" wealth finance platform to create
+value for both the Bank and its customers. It introduced seven wealth management companies to
+the platform, including BOC Wealth Management, Amundi BOC and CMB Wealth Management
+etc., and registered an increase of 75.30% in the balance of wealth management products for
+personal customers. It launched the "BOC Selection" brand and cooperated with 12 third parties
+such as BOCIM and Guohua Life. The Bank published the BOC White Paper on Personal
+Banking Global Asset Allocation for the fourth consecutive year and launched “BOC Investment
+Strategy", a global investment advisory service system covering global stocks, bonds, currencies
+and commodities, and consisting of daily, weekly, monthly, quarterly and annual reports. It
+refreshed the visual branding of medium and high-end customer service brands such as "BOC
+Wealth Management” and “BOC Prestigious Wealth Management” in an effort to drive market
+competitiveness through brand influence. It developed six benefit areas (namely health care,
+study abroad/cross-border, ice and snow sports, business travel, better life and member mart),
+improved its privilege benefit service platform and provided more than 170 privilege benefit
+services to meet the needs of customers in non-financial scenarios including clothing, food,
+accommodation, transportation, tourism, entertainment, learning and pensions. As at the end of
+2021, the Bank had established 8,239 wealth management centres and 1,092 prestigious wealth
+management centres in the Chinese mainland. It was recognised as the “Best Bank in Wealth
+Management" by CBN and honoured as the “Most Influential Financial Brand BOC Wealth
+Management" by Caijing Magazine.
+Wealth Finance Business
+61
+Personal Foreign Exchange Business
+The Bank actively adapted to a changing market environment and shifting customer needs,
+consolidated its leading edge in cross-border finance and continued to optimise its personal
+foreign exchange services. As at the end of 2021, the personal foreign currency deposits of the
+Group's commercial banking business in the Chinese mainland amounted to USD46.102 billion,
+representing the largest market share among peers. The Bank offered personal foreign currency
+deposit and withdrawal services in 25 currencies and personal foreign exchange services in 39
+currencies, securing the leading position among peers. In addition, it promoted online processes
+for traditional business services and was the only bank in the industry to support the self-service
+conversion of foreign currencies into e-CNY. Its foreign exchange cash reservation service
+was available in major cities in the Chinese mainland and via multiple channels such as mobile
+banking, WeChat banking and online banking, and was integrated into external data interfaces
+such as China's online government affairs service platform, HUAWEI HarmonyOS and JegoTrip
+APP. It made efforts to improve the micro-payment experience for visitors to China and realised
+the networked systems and unified operation and management of authorised foreign currency
+exchange hotels, thus effectively serving major events such as the Beijing 2022 Winter Olympics
+and CIIE.
+Bank Card Business
+As part of its digital transformation strategy, the Bank accelerated digital transformation and
+scenario building for its bank card business. It steadily pressed ahead with its debit card business
+and expanded scenario-based applications for mobile payment, thus continuing to improve
+customer experience. Leveraging its advantages in higher education institution services, the
+Bank made efforts to create a "Whole Education" scenario. It also enriched its integrated "online
++ offline" and "financial + non-financial” services, issued social security cards equipped with
+financial functions in cooperation with local Human Resources and Social Security Bureaux, and
+expanded the functions of electronic social security cards and medical insurance e-vouchers. As
+at the end of 2021, the Bank had cumulatively issued 116.4572 million physical social security
+cards and 8.2999 million electronic cards. It endeavoured to improve rail travel services and
+extended Railway e-Card coverage to 50 railway lines, including in such national strategic
+regions as the Beijing-Tianjin-Hebei region, the Yangtze River Delta, the Guangdong-Hong
+Kong-Macao Greater Bay Area and the Hainan Free Trade Port, and serving over 3 million
+customers.
+662
+62
+The Bank promoted brand building for the Olympic Games and snow and ice sports, and
+continued to bolster its market reputation as the official banking partner of both Winter and
+Summer Olympic Games. Leveraging its strengths as a Winter Olympics partner, the Bank
+issued and promoted Beijing 2022 Winter Olympics-themed debit card and credit card, provided
+offshore bank card acceptance services to cross-border customers. It also provided services for
+the construction of a card acceptance environment for the Beijing Zone and Zhangjiakou Zone of
+the Beijing 2022 Winter Olympics.
+The Bank implemented an innovation strategy for green financial products, issued green and
+low-carbon digital credit cards and built a green and low-carbon bonus point system. It also
+established "Head Office to headquarters” cooperation agreements regarding automobile purchase
+instalments with a number of new-energy vehicle brands and jointly launched a preferential
+interest rate policy to boost the sales growth of new-energy vehicles. Moreover, the Bank further
+implemented the nation's rural revitalisation strategy and launched rural revitalisation-themed
+credit cards on a pilot basis. It put in place a policy of fee reduction and profit concession to
+benefit micro and small-sized businesses and private enterprises, and reduced debit card fees for
+standard merchants. In response to the nation's key regional development strategies, the Bank
+supported special marketing activities such as the CIIE and CICPE, as well as marketing activities
+related to the Chengdu-Chongqing economic circle, the Yangtze River Delta and the Greater Bay
+Area business district. Integrating high-frequency small-amount transaction scenarios into the
+"BOC Benefit Day” brand, the Bank continuously carried out the "Thousand Stores in a Hundred
+Cities” campaign, covering livelihood consumption sectors including restaurants, department
+stores, convenience stores, petrol, public transportation and subways. Adhering to the principle of
+high-quality development, the Bank focused on increasing the activity rate of new customers and
+promoting the improvement of credit card asset quality.
+The Bank's bank card issuance and transaction volumes as at the end of 2021 are set forth below:
+2020
+Change (%)
+31 December
+2020
+9,262.792
+Fully leveraging the advantages arising from its globalised operations and diversified business
+platform, the Bank followed its mission to serve the real economy and provided its clients with
+comprehensive, professional, and customised “onshore + offshore” and “financing + intelligence"
+integrated financial services plans, including financial products and services such as bond
+underwriting and distribution, asset-backed securitisation (ABS), and professional financial
+advisory services, etc. To facilitate the development of China's multi-layered capital markets and
+support customers in their direct financing, the Bank underwrote bonds in the China interbank
+market of a total amount of RMB1,608.947 billion. It actively supported green finance, as
+shown by the Bank's dominant position in both onshore and offshore green bond underwriting.
+It underwrote pioneering green deals including the first batch of carbon-neutral bonds and
+sustainability-linked bonds, the first sovereign green Panda bond, and the first local government
+offshore green RMB bond. It strongly boosted its underwriting business for financial institutions,
+with its financial bond underwriting amount and market share continuing to lead the market. The
+Bank further built its competitiveness in cross-border underwriting business. It helped Hungary,
+Asian Development Bank and other overseas issuers to issue Panda bonds and maintained the
+largest market share in Panda bond underwriting. Acting as the lead underwriter and bookrunner,
+the Bank assisted the MOF in successfully issuing USD and EUR sovereign bonds, totalling
+USD8.5 billion equivalent. These issuances further improved the yield curve of foreign currency-
+denominated sovereign bonds and strengthened international investors' confidence in China's
+economy. The Bank maintained the largest market share in China's offshore bond underwriting. It
+also helped to deepen the two-way opening up of financial markets. It participated in the launch
+of Southbound trading under Bond Connect and the inaugural issuance of the Yulan bonds,
+thus contributing to the building of both domestic and international market infrastructure. It
+held a leading market share in terms of asset-backed securitisation underwriting business in the
+interbank market, while its sales volume of NAFMII credit bonds continued to rank first among
+peers. The Bank was awarded “China Bond House" by IFR Asia; "Best Bank for Domestic
+Debt Capital Markets”, “Best Green Bond Bank”, and “Best Domestic Bank for Securitisation"
+by Asiamoney; "Best Bond Adviser Global" by The Asset; "Best Debt House
+Asia" by
+FinanceAsia, and “Best Panda Bond House" by GlobalCapital China. In this way, the brand
+influence of "BOC Debt Capital Markets" was continuously enhanced.
+_
+The Bank actively promoted asset-backed securitisation business, optimised assets structure,
+issuing 11 credit asset-backed securitisations during the year, including 5 residential mortgage-
+backed securities (RMBS) transactions with a total issuance volume of RMB46.442 billion and 6
+NPL transactions with a total issuance volume of RMB3.476 billion.
+The Bank continued to build its professional financial advisory service system and strengthened
+the group-level coordination. It provided clients with professional advisory services such as
+M&A, debt restructuring, divestitures, equity financing and project financing. It served clients
+including central state-owned enterprises, local state-owned enterprises and private enterprises in
+relation to several major acquisitions and project financing.
+66
+Asset Management
+Giving full play to the advantages arising from its globalised operations and comprehensive
+business platform, the Bank seized market opportunities brought by the continuous increase of
+residents' wealth and accelerated the establishment of a first-class asset management business.
+With the aim of serving the real economy and preservating and appreciating residents' wealth,
+the Bank effectively connected investment and financing, actively served areas including green
+finance, cross-border finance, wealth finance and so on. The Bank continuously accelerated the
+issuance of various special themed innovative products, enriched its themed product systems
+such as green, technology and cross-border. Its cross-border wealth management products led the
+industry in terms of scale.
+The Bank strictly followed the new regulations on asset management and other regulatory
+requirements to advance the rectification of existing wealth management products, completing the
+aforesaid rectification at the end of 2021.
+The Asset Management Committee of the Bank is responsible for the top-level design and overall
+management of the asset management business line. The Bank carried out asset management
+business through BOC Wealth Management, BOCIM, BOCI China, BOC Asset Investment,
+BOC Hong Kong Asset Management, BOC International Prudential, its Luxembourg Branch
+and other institutions, providing individual and institutional investors with access to local and
+foreign currency products with a comprehensive range of asset classes, diversified investment
+strategies and complete investment cycle. The Bank's business scale and market share continued
+to grow. At the end of 2021, the Bank's AUM reached RMB3.2 trillion, of which BOC Wealth
+Management's AUM was RMB1.71 trillion, an increase of 23.17% over the beginning of the
+year. The market influence of the Bank's asset management business also improved. During the
+year, BOC Wealth Management received the Golden Bull Award from China Securities Journal,
+the Golden Reputation Award from PYSTANDARD, and Best Asset Management Company
+for Responsible Investment from Sina Finance. BOCI China received Junding Award for Fixed-
+income Asset Management Team, Junding Award for Fixed-income Asset Management Plan in
+China from Securities Times. BOCHK AM was awarded Best RMB Manager, Best CNY Bonds,
+Offshore (5 Years) by Asia Asset Management. BOC International Prudential received Awards of
+Excellence ETF Management from Hong Kong Economic Journal and Best Pension Fund over
+3 Years from Refinitiv Lipper Fund Awards Hong Kong.
+10
+BOC Fullerton Community Bank won a number of awards and honours during the year, including
+the "People's Inventive Service Award", "Outstanding Contribution Award for Supporting
+Rural Revitalisation”, “Excellent Case of Financial Services for Micro, Small and Medium-
+sized Enterprises” and “Demonstration Institution for Rural Revitalisation with Excellent
+Competitiveness", etc.
+Transaction amount of debit cards
+67
+68
+88
+Custody Business
+Adhering to the principles of serving the real economy and enhancing value creation, the Bank
+continued to promote the comprehensive and high-quality development of its custody business
+with a focus on achieving breakthroughs in key areas. As at the end of 2021, total assets of
+the Group's custody business amounted to RMB15.23 trillion, an increase of 29.22% year-on-
+year. The scale and income of its custody business continuously increased, and its market share
+improved. The Bank achieved a leading growth rate among major Chinese peers in terms of the
+size of mutual funds under custody and ranked among the top in the industry in terms of the
+number and size of newly-issued mutual funds under custody. It supported the multi-tier social
+security system and provided services for key pension security custody projects, including the
+first batch of pilot projects for pension finance products. The Bank provided custody services
+and support for green bond issuance funds, green industry funds and green asset-backed security
+(ABS) products, and served as the custody bank for the first carbon-neutral mutual fund in the
+market. It continuously worked to refine the operation and service quality of its custody business,
+enhance its comprehensive risk management system, and improved its service capabilities for
+innovative businesses.
+Village Bank
+As an important platform for implementing inclusive finance and the rural revitalisation strategy,
+BOC Fullerton Community Bank is committed to providing modern financial services to county-
+level micro and small-sized enterprises, individual merchants, wage earners and farmers with the
+aim of "focusing on county area development, supporting farmers and small-sized enterprises,
+and growing together with communities”. As at the end of 2021, BOC Fullerton Community
+Bank controlled 124 village banks with 185 sub-branches, making it the largest domestic
+village bank group in terms of total institutions. Its registered capital amounted to RMB8.618
+billion, with total assets and net assets standing at RMB98.317 billion and RMB13.825 billion
+respectively. In 2021, BOC Fullerton Community Bank achieved a profit for the year of RMB990
+million.
+BOC Fullerton Community Bank continuously improved its product and service system, further
+expanding its customer base and business scale. As at the end of 2021, the balances of total
+deposits and loans of its banks stood at RMB54.557 billion and RMB69.239 billion respectively,
+an increase of 17.11% and 25.50% compared with the prior year-end. BOC Fullerton Community
+Bank also set up and optimised a comprehensive risk management system for business lines
+that support farmers and small-sized enterprises, thus maintaining good asset quality. The NPL
+ratio was 1.30%, and the ratio of allowance for loan impairment losses to NPLs was 261.78%.
+With a focus on rural industry development, rural infrastructure construction, improvement to
+living environments and other key areas, BOC Fullerton Community Bank actively provided
+support for specialised cooperatives, family farms, large specialised households and other new
+business entities. In addition, it recorded notable achievements in using digital means to upgrade
+its services in order to unblock “last mile” barriers to delivering county-level financial services.
+For its "credit under village-by-village promotion” service, it successfully automated the whole
+process of approval, contracting and disbursement, as well as integrating the post-lending
+function into its digitally-enabled whole-process mobile business platform. Mobile handling
+across the whole process, from customer visits to application for deposits and loans, was realised
+for all business scenarios.
+BOC Fullerton Community Bank pushed forward with equity integration, enhancing its intensive
+and specialised operations. In November 2021, CBIRC Hebei Office approved a private
+placement plan of BOC Fullerton Community Bank Co., Ltd., a rural investment management
+bank. The Bank was thus approved to increase the capital of BOC Fullerton Community Bank
+Co., Ltd. by RMB9.332 billion, using its own funds and the equity it holds in 126 rural banks.
+Investment Banking
+55
+66
+The Bank continuously improved its financial markets business systems, consolidated its business
+development foundations and enhanced its comprehensive customer service capabilities. It
+outperformed peers in terms of market share of foreign currency exchange against RMB by
+providing 40 currency pairs available for exchange, as well as launching interbank regional
+trading for the Indonesian Rupiah. It also led the domestic market in terms of the total number of
+tradable foreign currencies. To fulfil the hedging needs of the real economy, the Bank actively
+improved its FX risk management services and used financial market trading instruments to
+help enterprises enhance their risk management. It also improved its online service capabilities
+to make customer transactions more convenient, achieving rapid growth in online corporate
+transaction volumes and customer scale. Seizing opportunities arising from the two-way opening-
+up of financial markets and relying on a multi-tier service system integrating trading, sales
+and research, the Bank took steps to expand its overseas institutional investor customer base
+and provide high-quality trading services for domestic bonds and derivatives. It pressed ahead
+with the implementation of the infrastructure connections to the Bond Connect (Southbound)
+programme, with related trading volumes leading the market. It also strengthened its quantitative
+trading capacity, pushed forward the building of its quantitative trading platform and refined its
+quantitative strategy. Closely tracking the reform of international benchmark interest rates, the
+Bank promoted hedging transactions that adopt the new benchmark interest rates and undertook
+several of the first transactions adopting new benchmark interest rates in domestic markets. It
+also improved infrastructure construction, strengthened risk control capability, and implemented
+mandatory initial margins. Furthermore, the Bank fully implemented the FX conduct code,
+continuously aligned trading business towards best practices and took the lead in finishing
+liquidity provider disclosure in FX market as guided by FX Global Code with peer banks in the
+Chinese mainland, under the coordination of China Foreign Exchange Committee.
+358.240
+Instalments volume of credit cards
+(4.69%)
+15.32%
+65
+8,031.941
+1,639.427
+63
+1,562.469
+Transaction amount of credit cards
+63
+363.798
+(1.53%)
+The Bank coordinated and promoted the digitalisation of the front, middle and back offices of
+its personal banking business so as to empower high-quality development. It built an agile front
+office, improved its integrated and collaborative channel management and enhanced its open
+and shared scenario ecosystem capabilities. In 2021, the volume of the Bank's mobile banking
+transactions reached RMB39.38 trillion, up 22.00% compared with the prior year. The number
+of non-financial mobile banking scenarios totalled 612, and the number of monthly active mobile
+banking customers stood at 71.04 million. The Bank created a smart middle office to develop
+its capabilities in accurate customer insight, full-process digital marketing, specialised products
+and services, and in-depth data asset mining and application. The Bank created an efficient back
+office to build efficient intelligent operational capabilities and intelligent internal control and risk
+management capabilities. In 2021, the “Cyber Defence” smart risk control and prevention system
+monitored 7.69 billion transactions through online channels, up 24.1% year-on-year. As at the
+end of 2021, the number of customers using mobile banking-oriented digitalised authorisation
+tools reached 20.20 million, up 66.94% from the end of the prior year. By comprehensively
+enhancing the digital capabilities of its personal banking business, the Bank embedded a digital
+"DNA" into all products, processes, sectors and business lines.
+Emphasising reform of organisational structure, the Bank continued to deepen the digitalisation
+process of its personal banking business, implementing hundreds of phased measures to
+comprehensively enhance the digital capabilities of various business areas. It also developed
+an indicator system to quantify the progress of digital transformation across all aspects of
+its personal banking business. During the year, it was recognised as “2021 Most Influential
+Digitalised Bank" by Caijing Magazine.
+64
+44
+Financial Markets Business
+The Bank actively aligned itself with trends towards the two-way opening-up of financial
+markets, national strategies and the development direction of the real economy, it continuously
+improved its business structure and stepped-up efforts to ensure compliance with regulatory
+requirements, thus maintaining its leading position in financial markets business.
+Securities Investment
+By strengthening its forecasting and analysis regarding the macroeconomic situation and market
+interest rates, the Bank proactively seized market opportunities and dynamically adjusted its
+investment portfolio in a bid to mitigate risk. It supported the development of the real economy
+and actively participated in local government bond investments. Following trends in global
+bond markets, the Bank optimised its foreign currency bond investment portfolio. Moreover, it
+supported the development of green finance and led the market in terms of investment volume of
+green debt financing instruments.
+Trading
+Digital Transformation of Personal Banking
+BOCHK deepened digital empowerment and expanded financial services outreach. With a
+view to improving customer experience in a comprehensive manner, BOCHK closely monitored
+market trends and empowered its businesses through digital transformation, drawing on digital,
+intelligent and ecological support. It expanded the reach of its financial services by actively
+promoting open banking and strengthening scenario-based applications of FinTech innovations.
+BOCHK accelerated the expansion of intelligent technology applications, thereby reducing
+processing times, enhancing employee productivity and improving operational efficiency. It
+constantly refined the building blocks of its database, further strengthening its risk control
+capabilities in intelligent anti-fraud and anti-money laundering. BOCHK also continuously
+optimised its agile working methodology and fostered digital talent, with a view to building a
+full-scale digital bank.
+(Please refer to the results report of BOCHK for a full review of BOCHK's business performance and related
+information.)
+Comprehensive Operation
+During the year, BOCHK was named "Bank of the Year in Hong Kong" by The Banker;
+"Strongest Bank in Hong Kong and Asia Pacific”, “Best Transaction Bank in Hong Kong"
+and "Best Cash Management Bank in Hong Kong" by The Asian Banker; “Most Outstanding
+Company in Hong Kong Banking Sector”, “Hong Kong's Best Digital Bank 2021" and
+"Best Chinese Bank for the Greater Bay Area" by Asiamoney; and "Hong Kong Domestic Cash
+Management Bank of the Year”, “Hong Kong Domestic Trade Finance Bank of the Year” and
+"Hong Kong Domestic RMB Internationalisation Initiative of the Year" by Asian Banking &
+Finance, as well as receiving the “Best SME's Partner Award" from the Hong Kong General
+Chamber of Small and Medium Business.
+BOCHK pushed forward integration and collaboration, giving full play to its regional
+synergies in Southeast Asia. Striving to continuously enhance its product innovation, customer
+acquisition, business promotion and technological capabilities in the Southeast Asian region,
+BOCHK enhanced its role as a regional headquarters for management, deepened intra-group
+collaboration and implemented market-by-market strategies according to the local conditions
+of each of its Southeast Asian entities. In addition, it actively arranged or participated in a
+number of syndicated loan projects in the Southeast Asian region. BOCHK remained committed
+to enhancing digital channel functions and online financial product innovation. It achieved
+full coverage of its personal mobile banking across Southeast Asia while gradually rolling out
+a number of other digital services in the region, including its intelligent Global Transaction
+Banking (iGTB) Platform, Enterprise Resources Planning Integration service, BoC Bill and the
+FXall Digital Transaction Platform. Bank of China (Thai) Public Company Limited received the
+"2021 Best of Cross Border Business Services Award” in Thailand. Bank of China (Malaysia)
+Berhad successfully launched the FXall Digital Transaction Platform, introduced "eWealth
+Banking", the first mobile application in the local market to provide one-stop investment and
+wealth management services, and launched the e-Pocket remote account opening service via
+mobile banking. Meanwhile, BOCHK Jakarta Branch successfully initiated services under the
+bilateral local currency settlement (LCS) agreement between China and Indonesia, outperforming
+market peers in terms of the value of RMB/IDR exchange transactions handled, and continuing to
+rank first among all foreign banks in Indonesia. BOCHK Phnom Penh Branch launched a Wealth
+Management service, enabling mutual brand recognition across regions and countries including
+Hong Kong (China), Malaysia and Cambodia. Adhering to stringent risk management, BOCHK
+closely monitored changes in its asset quality so as to enhance its risk management capabilities in
+credit risk, market risk, interest rate risk and liquidity risk. In 2021, BOCHK's Southeast Asian
+entities registered solid growth, recording a steady increase in customer deposits and loans and
+maintaining benign asset quality.
+16
+BOCHK deepened collaboration across key areas and reinforced its competitive edge in
+cross-border services. Seizing opportunities from financial policies relating to cross-border
+RMB services, BOCHK proactively engaged in the development of major regions such as the
+Guangdong-Hong Kong-Macao Greater Bay Area, the Yangtze River Delta and the Beijing-
+Tianjin-Hebei region, with a view to fulfilling the cross-border financial needs of technology
+and innovation companies by offering them diversified products and services. BOCHK made
+solid progress in promoting mutual financial market access. It successfully launched Southbound
+trading under Bond Connect and Cross-Boundary Wealth Management Connect services, with
+the trading volume of both ranking among the top tier in Hong Kong. It continuously optimised
+the cross-border customer service experience, including that of the "Greater Bay Area Account
+Opening Service” and “Personal Loan” mortgage service, promoted the Bay Area Social Security
+Service and introduced “GBA Youth Card”, offering integrated service solutions to meet personal
+customers' needs for wealth management, investment and spending as well as other cross-border
+financial services. It optimised the coordination and management mechanism of its RMB business
+and established a cross-departmental on-demand RMB working unit. By applying an agile
+working methodology, its new product development and marketing achieved concrete results.
+Focusing on its key corporate customers, business segments and regions, BOCHK actively
+explored business opportunities, with its RMB deposits and loans recording steady growth.
+Leveraging its strong franchise as Hong Kong's RMB clearing bank, BOCHK contributed to the
+refinement of cross-border financial infrastructure and enhanced the quality and efficiency of its
+clearing service, with the aim of proactively supporting and cultivating the offshore RMB market.
+BOCHK launched a number of products and services denominated in RMB, including a CNH
+PBOC bills repo service, green deposits and loans, and the ESG Multi-Asset Fund. It continuously
+promoted RMB business in the Southeast Asian region, with both Bank of China (Malaysia)
+Berhad and BOCHK Manila Branch being granted direct participant qualification by the CIPS,
+BOCHK Manila Branch officially launching its RMB clearing bank service, and BOCHK Brunei
+Branch successfully introducing its RMB cross-border salary direct remittance service, thus
+achieving steady development in its regional RMB business.
+75
+BOCHK actively explored opportunities in its domestic market of Hong Kong and met a
+full range of customer needs. The growth of BOCHK's total customer deposits and loans was
+above the market average, and the asset quality of its loan portfolio outperformed local peers
+in Hong Kong. It continued to enhance internal and external collaboration to provide support to
+major projects and maintained its top market share in the Hong Kong-Macao syndicated loan
+market. Seizing opportunities arising from the secondary listing of China concept stocks and the
+development of capital markets, BOCHK retained its top market position as an IPO receiving
+bank. It also upgraded its Home Expert mobile application with functional enhancements,
+which helped BOCHK to capture direct mortgage business opportunities and maintain its top
+market position in terms of the total number of new mortgage loans. In addition, it expanded
+its cash management, trade finance and treasury businesses, and secured market leadership in
+the cash pooling business. BOCHK continued to promote its premium Private Wealth service
+to high-end customers, featuring online services for investment and insurance alongside its RM
+Chat services. As a result, it recorded significant year-on-year growth in the related number of
+customers and amount of assets under management. It also revamped the image of its Wealth
+Management service by injecting vitality and digital elements, thus providing customers with a
+more diversified experience.
+74
+BOCHK fostered ESG concepts and actively promoted green finance. Adhering to the
+concept of sustainable development, BOCHK enriched its green financial products and services
+suite, pushed forward low-carbon and highly efficient operations, and capitalised on its reputation
+as a pioneering bank in sustainable development. In line with the market and client trends towards
+low-carbon transition, BOCHK actively promoted green finance by launching Hong Kong's first
+green mortgage plan with a large real estate company, offering its corporate clients green bonds,
+green loans, green consulting and certification services, and supporting green and low-carbon
+retail spending, with the aim of meeting customers' financial needs for business transformation
+towards low-carbon and sustainable development. It also launched the BOCHK All Weather
+ESG Multi-Asset Fund, its first ESG fund to be authorised by Hong Kong's Securities and
+Futures Commission, and successfully issued "sustainable and smart living" themed green bonds.
+BOCHK has been a constituent of the Hang Seng Corporate Sustainability Index Series for 11
+consecutive years and was named “Best Bank for CSR in Hong Kong" by Asiamoney for the third
+consecutive year.
+Against the backdrop of a complex and challenging market situation, BOCHK remained focused
+on high-quality development by strengthening execution of its strategic plans and leveraging its
+regional synergies. It fostered ESG concepts and promoted the development of green finance.
+BOCHK optimised its regional integrated business system and upgraded the service capabilities
+of its Southeast Asian entities. It strengthened its integrated financial service capabilities in order
+to further develop its core market in Hong Kong, while vigorously capturing market opportunities
+arising from the financial policies of the Guangdong-Hong Kong-Macao Greater Bay Area and
+reinforcing its competitive edge in cross-border services. By deepening digital empowerment,
+BOCHK optimised its risk management and regulatory compliance mechanisms and increased the
+application of FinTech in its products and services. As at the end of 2021, BOCHK's issued share
+capital was HKD52.864 billion. Its total assets amounted to HKD3,639.430 billion and net assets
+reached HKD327.461 billion. Its profit for the year was HKD24.999 billion.
+BOCHK
+Faced with the COVID-19 pandemic, the Bank established the steering group mechanism
+for business continuity management and implemented the business continuity management
+requirement, ensuring business continuity. It enhanced the building of basic systems and drew
+business continuity plan and contingency plan. It also strengthened the construction of supporting
+function that features high risk level and wide range of influence. Fully leveraging the advantages
+of its globalised services, the Bank enhanced the online service capability of its overseas
+institutions with the help of mobile banking. It built a global trading network according to product
+line and time zone, instituting backup facilities in Beijing, Shanghai, Hong Kong, London and
+New York to ensure business continuity.
+The Bank implemented national strategies and supported the development of the real economy
+through high-quality integrated financial services. It remained committed to sharpening the
+Group's differentiated advantages based on its integrated operations and serving as a driver of
+value creation, functional innovation and mechanism exploration for the Group.
+Measures for Business Continuity
+76
+The Bank actively explored and strengthened the synergistic mechanism between the Bank and
+its comprehensive operation companies, promoted new modes of integrated synergy and set up
+integrated operation and synergy offices in ten key areas. Leveraging its advantages in integrated
+operations, the Bank carried out marketing focused on the "Eight Priority Areas for Enhancing
+Financial Services Capabilities” and enhanced the brand influence of the Group's integrated
+financial services by implementing several prestigious projects such as the IPO of Zhengyuan
+Geomatics Group Co., Ltd. on the Science and Technology Innovation Board of the SSE, mixed
+ownership reform of China Baowu Steel Group Co., Ltd., and Series A funding of SVOLT.
+BOCI China received numerous awards from authoritative media, such as "Best Local Investment
+Bank", "Best Bond Underwriting Investment Bank”, “Best IPO Project” and “Most Creative
+Project" from New Fortune for its investment banking business; "Junding Award for Fixed-
+income Asset Management Team in China”, “Junding Award for ABS Asset Management
+Team in China” and “Junding Award for Fixed-income Asset Management Plan in China” from
+Securities Times, and "Best ABS Asset Management Securities Company” and “Best Innovative
+Asset Management Product of Securities Companies” from China Fund for its asset management
+business, as well as the "Most Progressed Research Institution" in the Crystal Ball Awards for
+sell-side analysts for its research and sales business, among others.
+72
+73
+12
+The Bank is engaged in fund management business in the Chinese mainland through BOCIM.
+As at the end of 2021, BOCIM's registered capital amounted to RMB100 million, its total assets
+stood at RMB5.579 billion and its net assets totalled RMB4.309 billion. In 2021, its profit for the
+year reached RMB1.026 billion.
+BOCIM
+Asset Management Business
+(Please refer to the results report of BOCI China for a full review of BOCI China's business performance and related
+information)
+BOCI China promoted business transformation through technological empowerment and refined
+its comprehensive wealth management service process with a focus on serving the wealth
+management needs of individual customers, constructing a customer-centric product system,
+and improving the service capability of its investment advisors. Deepening its synergistic
+advantages of “investment banking + commercial banking”, “investment banking + investment”
+and "domestic + overseas", and targeting key clients and key industries, BOCI China drew up
+blueprints for technology finance, green finance, rural revitalisation and other national strategic
+areas, achieving breakthroughs in terms of “pioneering deals” in those areas and shifting its
+investment banking business focus towards transaction-driven comprehensive financial services.
+It further improved its customer service capabilities, shifting its asset management business focus
+towards active management services. In addition, the brand reputation of its research products
+was further enhanced. BOCI China ranked 12th for bond lead underwriting volume (excluding
+local government bonds), as well as 3rd and 14th for assets under management and net income
+respectively, highlighting its continuously increasing market influence.
+BOCI China is engaged in securities-related business in the Chinese mainland. As at the end of
+2021, the registered capital was RMB2.778 billion.
+77
+-
+BOCI was again awarded “Best DCM House (Hong Kong Chinese Financial Institutions)"
+in the 2021 Country Awards and “Best Debt House, Asia" in the 2021 Achievement Awards
+organised by FinanceAsia. It was also recognised as “2021 Best Private Bank for HNWIs Hong
+Kong" by The Asset and received the "Awards of Excellence ETF Management” in the
+2021 Financial Services Awards of Excellence organised by Hong Kong Economic Journal.
+In addition, BOCI's mixed-asset HKD balanced MPF was awarded "Best Pension Fund over 3
+Years" in the 2021 Refinitiv Lipper Fund Awards Hong Kong.
+--
+88
+78
+The Bank is engaged in investment banking business through BOCI. As at the end of 2021, BOCI
+had an issued share capital of HKD3.539 billion, total assets of HKD96.875 billion, and net assets
+of HKD22.658 billion. In 2021, BOCI realised a profit for the year of HKD1.489 billion.
+BOCI consolidated its advantages in traditional investment banking and accelerated the
+development of wealth management and asset management business. It refined its risk
+management system to support business innovation, and fostered the new development pattern
+in which domestic and international circulations reinforce each other through its activities
+in equity and bond financing, cross-border wealth management, M&A, asset management,
+ESOP and global commodities. BOCI enhanced its globalised and integrated investment
+banking capabilities and assisted with the secondary or dual listing of a number of China
+concept stocks in Hong Kong. It participated in the issuance of Saudi Aramco's first USD
+sukuk and was the only Chinese investment bank to participate in the issuance of Pakistan's
+overseas USD sovereign bond. BOCI acted as the joint sell-side financial advisor to Kerry
+Properties in relation to the partial offer made by S.F. Holding for a stake in Kerry Logistics,
+supported Cathay Pacific in selling convertible bonds related to its corporate restructuring, and
+participated in the issuance of several Chinese institutions' overseas green bonds. It optimised
+its cross-border wealth management service, enhanced its mobile securities services, pushed
+forward the digital transformation of its securities services, and promoted artificial intelligent
+driven investment advisory services and other FinTech applications. As a result, the brokerage
+business and the trading volume of over-the-counter equity derivatives maintained steady
+performance. The “BOCI Greater Bay Area Leaders Index” continued to outperform its peers.
+BOCI continued to improve its asset management capabilities by developing and promoting
+ESG indices and asset management products. BOCI-Prudential Asset Management Limited, a
+subsidiary of BOCI, maintained its position as a top-ranked service provider in the Hong Kong
+Mandatory Provident Fund (MPF) and Macao Pension Fund businesses. Eleven eligible funds
+under the Cross-boundary Wealth Management Connect scheme have been listed on the product
+platforms of the first batch of Hong Kong banks authorised to carry out Cross-boundary Wealth
+Management Connect business in the Guangdong-Hong Kong-Macao Greater Bay Area. In
+addition, BOCI accelerated development of its global commodity centre. It proactively facilitated
+the internationalisation of the onshore commodities futures market, and assisted Shanghai
+International Energy Exchange in promoting its crude oil products and futures.
+BOCI
+Investment Banking Business
+The Bank continuously improved the group-wide management and control mechanism of its
+integrated operations, strengthened the comprehensive development of a “strong headquarters”,
+drew up special plans for integrated development and optimised its performance evaluation
+mechanism. It pressed ahead with the building of its comprehensive risk management system,
+improved the audit management mechanism of its integrated operations, and advanced relevant
+digital transformation. Furthermore, the Bank refined its corporate governance structure and
+improved the quality and efficiency of its corporate governance.
+BOCI China
+The Bank strengthened the development of mobile finance, providing services covering 30
+countries and regions and available in 12 languages. It enhanced overseas personal mobile
+banking and continued to iterate and upgrade service functions to improve customer experience.
+In addition, the Bank launched mobile banking services in Panama, Luxembourg, the
+Netherlands, Belgium, Portugal, Sweden and other countries. It optimised public mechanisms,
+further enriched online channel services, and rolled out new services such as password-free small-
+amount transfer, online application for online banking and mobile banking, online activation and
+loss reporting for credit cards, online change of debit card passwords, and online reminders of
+document expiration, thus improving customer experience in an all-round way.
+The Bank continuously improved its cross-border RMB clearing capabilities and strongly
+promoted the cross-border application of RMB, thus further consolidating its leading edge in
+international payments. As at the end of 2021, the Bank accounted for 13 of the world's 27
+authorised RMB clearing banks, continuing to lead its peers. It provided continuous support
+to expand the global coverage of RMB CIPS and ranked first in terms of the number of CIPS
+direct participants and indirect participants. In 2021, the Group's cross-border RMB clearing
+transactions totalled RMB632 trillion, an increase of more than 34% compared with the prior
+year, maintaining the leading position in the global market.
+The Bank accelerated digital transformation, emphasised on customer experience improvement
+and online business process rebuilding, and improved its product and service systems. The Bank
+further consolidated its leading position among Chinese banks in overseas corporate online
+banking services, covering 51 countries and regions, with 15 languages available including
+Chinese, English, Korean, Japanese, German, French and Russian.
+The Bank strived to build its technology-enabled platform and accelerated iteration and
+upgrading. Based on its Global Service Platform (GSP), the Bank upgraded and improved
+functions related to customer marketing and product management and developed a unified
+platform for group customer management, single customer management, marketing management
+and performance management. It improved the post-lending management platform for corporate
+banking, developed a mobile version, and enhanced online, process-oriented, standardised and
+intelligent post-lending management. It also optimised the risk warning system and quantitative
+scoring system for potential risks to improve the hit rate and accuracy of risk early warning.
+79
+Globalised Operation
+The Bank continued to optimise its global network and further enhanced its capability to provide
+globalised services to customers. As at the end of 2021, the Bank had 550 overseas institutions
+covering 62 countries and regions, including 41 countries under the Belt and Road initiative. In
+October 2021, BOC Geneva Branch officially launched operations.
+The Bank continued to optimise its overseas network management architecture and operating
+mechanism, pressed forward with the management and construction of overseas regional
+headquarters in regions such as Southeast Asia and Europe, Middle East and Africa (EMEA),
+and at the same time promoted the operational streamlining of its business lines. It continued to
+implement the categorisation of its branches and subsidiaries outside the Chinese mainland, and
+developed market-by-market strategies for its overseas operations. This differentiation approach
+enables our overseas institutions to gain a stronger footing to pursue differentiated growth,
+generate greater synergy among our global presence, and continue to sharpen our competitiveness
+in the global markets.
+Corporate Banking
+Keeping a close eye on market changes, the Bank strengthened its risk management, took
+effective measures in line with local conditions, and gave full play to its advantages in globalised
+operations to actively serve “Bringing In” and “Going Global” customers, World Top 500
+and local corporate customers. The Bank fully utilised syndicated loans, M&A financing,
+project financing and other advantageous products to support key areas and projects such as
+infrastructure construction, green industries and international production capacity cooperation,
+and continued to promote the high-quality development of Belt and Road initiative, and promoted
+positive interplay between domestic and international circulation through high-quality, efficient,
+personalised and comprehensive financial services. As a result, overseas corporate deposits and
+loans maintained stable growth and the Bank's industry and customer structure continuously
+improved.
+70
+70
+The Bank focused on the bilateral trade business and related customers, and gave full play to its
+unique advantages in both domestic and foreign markets to mobilise the domestic and overseas
+resources of the Group, thus achieving steady growth in overseas international settlement
+and trade finance business and improving its global strategic synergies and the quality and
+effectiveness of its customer services. It continuously improved the overseas functions of cash
+management, and better leveraged the advantages of global cash management products, to
+provide cross-border centralised fund management services for multinational enterprises. It
+further enhanced its integrated services, with the global cash management services reaching 35
+countries and regions.
+In line with the global trend of attaching great importance to environmental, social, governance
+(ESG) and the rapid development of green industries, the Bank explored business opportunities
+contained in the infrastructure investment and transformation needs in the process of realising the
+"carbon peaking and carbon neutrality” goal, and promoted the green transformation of business.
+Giving full play to the role of "attracting intelligence", the Bank focused on scientific and
+technological achievements to meet people's needs for a better life and improve people's living
+standards and quality. By means of SME matchmaking, the Bank introduced overseas mature
+and replicable experience, practices or models to build a bridge for cross-border intellectual
+financing.
+Personal Banking
+As the most globalised Chinese bank, the Bank solidly pushed forward its globalised operations
+and continually improved its global services and global management capabilities. It actively
+served China's new development pattern and the national strategy of higher standard opening-
+up, tapped into business opportunities and helped to smooth flows in the domestic economy
+and promote positive interplay between domestic and international circulation that complement
+each other. Through cross-border collaboration and coordination, the Bank better served two-
+way investment, pushed forward high-quality “Bringing In” and high-level “Going Global", and
+continuously realised value creation. As at the end of 2021, the Bank's overseas commercial
+banking business realised customer deposits and loans of USD501.325 billion and USD423.937
+billion respectively, an increase of 3.34% and 3.96% from the prior year-end. In 2021, the Bank's
+overseas commercial banking business achieved a profit before income tax of USD7.124 billion,
+accounting for 16.60% of the Group's total profit before income tax.
+71
+The Bank continued to leverage its advantages in globalised operations and expanded its
+business to cover over 6 million customers in more than 30 countries and regions. It continued
+to improve its overseas service system for personal customers, providing customers with more
+comprehensive services such as account management, settlement and electronic channels. It
+offered wealth management and private banking services in Hong Kong (China), Macao (China)
+and Singapore. It gave full play to the characteristics of its cross-border services and consolidated
+the development of its personal banking business in key regions. It built the “Three-in-One"
+cross-border platform, launched the "BOC Cross-border Services" app, upgraded the cross-
+border section of its mobile banking service and launched the "BOC Compass" WeChat applet to
+strengthen the foundations of its cross-border financial services. The Bank continuously pushed
+forward product innovation and process optimisation, and continued to refine functions such
+as online foreign exchange purchase and remittance for studying abroad, self-service exchange
+machines, foreign exchange cash reservation and collection of foreign currency reservation.
+Through scenario-based financial services ecosystem of cross-border facilitation, it provided
+one-stop information and financial services for students studying abroad, travellers and non-
+resident customers. Seizing emerging business opportunities, the Bank accelerated growth in
+personal customers with trade and capital accounts, including for China's market procurement
+trade pilot programme and H-Share full circulation. Fully leveraging the brand advantages of
+its cross-border business, the Bank placed emphasis on maintaining customer segments such as
+cross-border online shoppers and students studying abroad, and continuously carried out "Global
+Wonderful" credit card cross-border themed marketing activities, with its cross-border market
+share increasing compared with the prior year-end. It focused on key areas and continued to
+improve its featured cross-border service system in the Guangdong-Hong Kong-Macao Greater
+Bay Area. As at the end of 2021, the Bank opened over a total of 167 thousand accounts via its
+Clearing Business
+72
+The Bank continued to take the lead among Chinese peers in terms of cross-border custody
+business, with its cross-border custody assets ranking first among Chinese banks. Being one
+of the first three pilot banks participating in Southbound trading under the Bond Connect
+programme, the Bank actively provided custody services for domestic investors investing in
+overseas bond markets.
+In 2021, the Bank underwrote Panda bonds with a total volume of RMB27.251 billion,
+representing a market share of 31.82% and ranking first in the market. It underwrote offshore
+China bonds with a total volume of USD9.095 billion and a market share of 5.39%, also ranking
+first in the market. In addition, it underwrote USD11.309 billion of Asia (excluding Japan) G3
+currency bonds, achieving a market share of 2.78% and ranking first among Chinese banks.
+Digital Transformation and Online Service Channels
+Financial Markets Business
+The Bank made solid efforts to advance the development of overseas wealth management and
+private banking, and sped up the building of its global “Private Banking”, “BOC Prestigious
+Wealth Management” and “BOC Wealth Management” brands. Based on the development pattern
+of "One Mainstay, Two Engines", it made concerted efforts to promote its Asia-Pacific private
+banking platform and established an integrated service mechanism linking corporate and personal
+business, domestic and overseas operations, and commercial banking and investment banking,
+forming a multi-layered private banking service system of “private banking + investment
+banking + commercial banking". During the year, it was recognised as "Best Private Bank for
+International Network" organised by Asiamoney.
+Meeting the needs of overseas customers for personal loans and card usage, the Bank's overseas
+commercial banking operations achieved healthy, sound and regulated development in the
+personal loan business and realised solid growth despite the continued spread of COVID-19,
+tightening regulatory environments and intensified market competition. The Macau Branch
+developed and launched the BOC Jinsha Fashion co-branded credit card, and the Singapore
+Branch upgraded its credit card business by launching a convenient bill payment function.
+"Greater Bay Area Account Opening" service in the region, and a total of 13 thousand customers
+were contracted for Northbound and Southbound trading under the Bond Connect programme.
+The "Macao Cross-border Wallet” marketing campaign was launched to ensure a stable
+acceptance environment for merchants and provide users with a good payment experience.
+The Bank actively carried out bond investment business while steadily improving the global
+integrated management of its investment operations and strengthened risk control. The Bank
+took full advantage of its globalised operations to provide stable and continuous quotation
+services worldwide and steadily improved its global service capabilities. The Bank continued
+to provide RMB market making and quotation services in Singapore, South Korea, Kazakhstan,
+Russia and other countries as well as Taiwan (China) and other regions, in a bid to facilitate
+the internationalisation of RMB. It consolidated the advantages of its globally integrated
+trading business and strengthened capacity building in its overseas trading centres. The Hong
+Kong Offshore RMB Trading Centre continued to improve its market-making and operational
+capabilities. The London Trading Centre implemented centralised trading operations to strengthen
+business support for the Bank's institutions in Europe and Africa.
+The Bank continuously increased its IT investment in overseas institutions, devoted solid efforts
+to infrastructure upgrading and renovation, and pushed forward the function optimisation and
+product promotion of its overseas systems, so as to meet local business needs and adapt to
+regulatory requirements related to new business patterns such as open banking and Payment
+Service Directive 2 (PSD2).
+198.7857
+Unit: million customers, except percentages
+6.4812
+Change (%)
+2020
+2021
+31 December
+31 December
+As at
+As at
+Following a "Mobile First” strategy and embracing digital transformation trends, the Bank
+continued to intensify efforts to expand its online channels and upgrade its mobile banking
+services, thus realising rapid growth in online business. In 2021, its e-channel transaction volume
+reached RMB324.97 trillion, an increase of 18.18% compared with the prior year. Among this,
+mobile banking transaction volumes reached RMB39.38 trillion, an increase of 22.00% compared
+with the prior year; the number of non-financial mobile banking scenarios totalled 612, and the
+number of monthly active mobile banking customers stood at 71.04 million, making mobile
+banking the online channel with the most active customers.
+Items
+52
+87
+Online Channels
+Focusing on customer experience, the Bank accelerated the transformation and upgrading of
+all service channels using digital transformation as the key driver, building online channels
+with stronger scenario integration capabilities and offline channels with greater value creation
+capacity. As a result, it cultivated an ecosystem in which online and offline channels are
+integrated and financial and non-financial scenarios are seamlessly connected.
+Service Channels
+Listed on the International Data Corporation (IDC) “2021 IDC China FinTech 50 List", BOC
+Financial Technology continued to promote innovative research and won several awards during
+the year for its self-developed products. “BOC Smart Investment” won the 2021 "China's Best
+Investment Advisory Service" award from The Asian Banker; while “Chainmore Blockchain
+Service Platform” and “THE REJUVENATION PLATFORM" won the "Comprehensive
+Intelligent Platform Award Silver Award" and "Digital Technology Innovation Award"
+respectively in the 2021 China Financial Digital Technology Innovation Competition.
+development of the Bank's comprehensive operations. It supported economic development in key
+areas, set up R&D bases in Wuhan, Hubei Province; Chengdu, Sichuan Province; and Hainan
+Province, and promoted the construction of Smart Hainan, the Xiongan New Area, the Yangtze
+River Delta, the Chengdu-Chongqing economic circle, the Guangdong-Hong Kong-Macao
+Greater Bay Area and other key cities by leveraging its overall financial technology strengths and
+focusing on regional economic development. It expanded service outputs, focused on building
+a talent pool management system for banking associations, and exported technological services
+in areas such as anti-money laundering and credit risk control for domestic and foreign banks.
+It accelerated internal digital construction, promoted engineering process reform, and won the
+CMMI5 software maturity advanced qualification certification.
+235.1805
+Number of corporate online banking customers
+Number of personal online banking customers
+Number of mobile banking customers
+5.4351
+194.2267
+210.5524
+12.72%
+2.35%
+The Bank made fresh innovations in outlet business models. It rolled out the "5G Intelligence +
+Greater Bay Area Pavilion" in Guangdong Province, the “5G Intelligence + Culture and Tourism
+Pavilion” in Shanxi Province and the “5G Intelligence + Ecosystem Pavilion” in Anhui Province,
+and built smart outlets that combine technology application, service experience, scenario linking
+and ecosystem integration. Furthermore, the Bank improved its differentiated outlet management
+The Bank accelerated the digital transformation of its outlets. Closely following the pace of
+digital reform in government services, it constructed a “government service + financial service"
+dual-purpose system and successively expanded more than 300 government affairs scenarios such
+as social security and tax services to its smart counters. In this way, it promoted the operation
+of smart outlets by embedding financial services into the building of digital government and
+smart cities. The Bank rolled out the "Yangtze River Delta Smart Government Affairs" service,
+realising the interconnectivity of government affairs services between Shanghai Municipality
+and Anhui Province and thus facilitating the integrated development of the two regions. It
+also delivered non-resident smart social security card services in the Hengqin-Guangdong-
+Macao In-Depth Cooperation Zone to boost the accelerated integration of people's livelihood in
+Guangdong and Macao. Furthermore, the Bank deepened cross-border scenario-based ecosystem
+development, expanded non-resident service scenarios at smart counters, supported passport-
+based business handling and launched multilingual services. It expanded service stations and
+launched tablet-version smart counters to support outlets” “Going Out” service marketing and
+increase the availability of financial services. The Bank constantly optimised its products and
+services, introducing digital debit card issuance and cardless services at smart counters to
+improve customer experience. Focusing on the elderly and other key customer groups, the Bank
+launched an elderly version of its smart counters to help older people adapt to the digital world
+and make intelligent financial services more inclusive.
+The Bank pushed forward the transformation of its outlets and continued to enrich its intelligent
+service ecosystem, in a bid to transform its outlets into integrated marketing and service entities
+encompassing all channels, scenarios and ecosystems.
+Offline Channels
+The Bank enhanced the digital risk control capacity of its online channels and accumulatively
+monitored 7.69 billion transactions through its "Cyber Defence” smart risk control and prevention
+system in 2021, an increase of 24.1% year-on-year. As at the end of 2021, the number of
+customers using mobile banking-oriented digitalised authorisation tools reached 20.20 million,
+up 66.94% compared with the prior year-end. “The Application Practice of Real-time Anti-fraud
+Machine Learning Model for Mobile Banking of Cyber Defence" won the "Full Honor Award" of
+China Electronic Banking Network.
+lifestyle convenience, fresh food, transportation, audio-visual entertainment, online medical
+consultation and so on, thus facilitating the building of better lifestyle scenarios. In addition,
+the Bank created the “Lucky” branding concept to demonstrate its new service image of warm,
+considerate, intelligent, convenient, safe and reliable. The Bank was granted the "Gold Award
+for Comprehensive Intelligent Platform" by China Electronic Banking Network and received the
+"Mobile Banking with Excellent Competitiveness” award from China Business Journal, and the
+"2021 Excellent Mobile Payment Bank” award from The Economic Observer.
+88
+For personal customers, the Bank adhered to its mobile banking development strategy of
+"integrated, intelligent, open, interactive and featured", and continued to improve personal
+mobile banking functions and user experience, thus actively facilitating the digital transformation
+of personal banking. It also released the brand-new Mobile Banking Version 7.0. Centring on
+the key customer groups of credit card, private banking and elderly care, it launched targeted
+services such as a credit card section, a private banking zone and an Elderly Version for its
+mobile banking. Focusing on wealth finance, the Bank revised its mobile banking fund modules,
+launched functions such as fund PK and fund diagnosis, added new features such as online audio
+and video recording and notice deposit “Smart Deposit” contracting, and strengthened customer
+information integration by adding information integration services such as “Earnings Report”,
+"My Ledger" and Monthly Statement. It enriched third-party merchant services and content
+information, with its Mobile Banking Life Channel expanding its circle of partners and covering
+For corporate banking customers, the Bank accelerated digital transformation, continuously
+improved the functions of its electronic channels and constructed a comprehensive Group-wide
+financial e-portal. It launched 24 products on corporate online banking, including BOC Wealth
+Management products, domestic foreign exchange remittance, certificates of deposit (CDs)
+and e-CNY batch payment. As at the end of 2021, BOC's corporate online banking service can
+provide more than a hundred products and services under 12 categories. Its Intelligent Global
+Transaction Banking system, centred on the new corporate online banking service, received a
+second prize award in the 2020 PBOC FinTech Development Awards. With the aim of creating
+a comprehensive mobile financial services portal that is convenient, efficient, intelligent,
+interactive and scenario-integrated, the Bank's corporate mobile banking offered over 50 high-
+frequency products and services such as fund transfer, inclusive financing, investment and
+wealth management. Focusing on "scenario integration", the corporate mobile banking bridged
+the gaps between the Bank's financial service system and its inclusive finance services Wechat
+applets, as well as its cross-border matchmaking Wechat applets, thus providing more convenient
+and flexible channels to support scenario building. In 2021, the Bank achieved year-on-year
+growth of 113.85% in corporate mobile banking transaction customers, and its corporate mobile
+banking service was granted the “Best Corporate Mobile Banking” award by the China Financial
+Certification Authority (CFCA).
+22.00%
+19.25%
+86
+232,166.028
+45,674.406 40,520.497
+39,376.511 32,277.028
+277,090.186
+Change (%)
+2020
+2021
+Unit: RMB billion, except percentages
+Transaction amount of personal e-banking
+Transaction amount of mobile banking
+Transaction amount of corporate online banking
+Items
+11.70%
+19.35%
+BOC Financial Technology served the domestic and international dual-circulation development
+strategy, supported significant projects and bolstered the development in key regions. It
+participated in the construction of enterprise-level architecture, undertook key projects such as
+anti-money laundering programmes, reform of the Bank's credit authorisation system, intelligent
+risk control and inclusive finance, and participated in the construction of scenario-based financial
+service ecosystem of silver, education, sports, transportation, cultural tourism, medical care,
+religion, housing construction and other scenarios. It served the Group's integrated development
+strategy and developed a comprehensive business management system and business data and
+assets management platform so as to enhance synergistic effects and promote the high-quality
+(Please refer to the results report of BOC Aviation for a full review of BOC Aviation's business performance and related
+information.)
+BOC Financial Technology
+The Bank is engaged in life insurance business in the Chinese mainland through BOC-Samsung
+Life. As at the end of 2021, BOC-Samsung Life's registered capital stood at RMB2.467 billion,
+total assets amounted to RMB49.275 billion and net assets amounted to RMB3.090 billion. In
+2021, BOC-Samsung Life recorded written premiums and premium deposits of RMB17.762
+billion and a profit for the year of RMB126 million.
+BOC-Samsung Life
+BOC Insurance received an “A” integrated risk rating (classified regulation) from the CBIRC
+for the 21st consecutive quarter and was rated "B" for corporate governance in the supervisory
+assessment for the 2nd consecutive year. It also maintained an “A-” rating and “stable” outlook
+from Standard & Poor's for the eighth consecutive year. It was awarded “Influential Insurance
+Company in 2021”, “Insurance Service Brand Deserving Attention in 2021” and “Insurance
+Innovation Project Deserving Attention in 2021" in the China Finance Billboard published by
+Hexun.
+82
+BOC Insurance thoroughly put into practice the new development philosophy, continuously
+served the national development strategy, and pushed forward transformation in quality,
+efficiency and impetus according to the Group's 14th Five-year Plan, with a view to achieving
+high-quality and sustainable development. Supporting the development of the real economy, BOC
+Insurance took advantage of its featured products such as tariff guarantee insurance and domestic
+trade credit insurance to facilitate financing for small and medium-sized enterprises. In response
+to the national innovation strategy, BOC Insurance applied the first (set of) comprehensive
+insurance to support the development of enterprises engaged in scientific and technological
+innovation, with the aim of promoting the innovation of the country's major technical equipment
+and intelligent manufacturing technology. It deeply participated in the modernisation of national
+governance systems and capacity, scaled up the supply of liability insurance products in areas
+such as emergency management and production safety, and gave full play to the role of insurance
+in social governance. To serve the development strategies of key regions, BOC Insurance carried
+out supporting policies in a differentiated manner so as to enable the coordinated development
+of all regions. Fully implementing the Group's comprehensive operation strategy, it proactively
+participated in the development of the “Eight Priority Areas for Enhancing Financial Services
+Capabilities” and “Four Scenario-based Financial Services Ecosystem”, and helped to provide
+a comprehensive financial services package for group customers. It deepened the application
+of FinTech in insurance, accelerated digital transformation, and boosted the building of a smart
+operation system. BOC Insurance also worked to improve its consumer protection mechanism and
+strengthened consumer protection publicity and education campaigns as well as risk alerts. It was
+recognised as an excellent organiser of the "3.15 Month of Financial Knowledge Popularisation"
+for the third consecutive year.
+The Bank is engaged in property insurance business in the Chinese mainland through BOC
+Insurance. As at the end of 2021, BOC Insurance reported registered capital of RMB4.535 billion,
+total assets of RMB13.712 billion and net assets of RMB4.920 billion. In 2021, it realised written
+premiums of RMB5.771 billion and a profit for the year of RMB320 million.
+BOC Insurance
+BOC Life continued to promote the transformation and upgrading of its product structure and
+launched a number of higher value-added whole life savings protection plans, including the
+"Forever Fortune Whole Life Insurance Plan", "SmartViva Flexi VHIS” and “Glamorous Glow
+Whole Life Insurance Plan”. It also continued to expand the coverage of its online channels,
+actively promoted intra-group cross-selling collaborations, and maintained its leading position
+in the Qualifying Deferred Annuity Policy market. To create a brand-new wellness ecosystem,
+BOC Life strengthened collaboration with cross-industry business partners including the world's
+leading smartwatch brand, innovative technology companies in Asia and Hong Kong, online
+social platforms, charities and social enterprises, with the aim of creating win-win situations
+for all and helping customers to create new value and gain a brand-new experience. BOC Life
+introduced the exclusive “Biological Age Model BAM" algorithm which was incorporated into
+a platform featuring gamification, charity and social elements, encouraging users to engage in
+healthy and "bio age"-reducing lifestyles together with their families and friends. To construct
+a retirement scenario ecosystem, BOC Life and Macao-based HN Group entered into a strategic
+cooperation agreement to promote "Serensia Woods”, a high-end wellness project in Hengqin,
+Zhuhai.
+81
+The Bank is engaged in life insurance business in Hong Kong through BOC Life. As at the
+end of 2021, BOC Life's issued share capital was HKD3.538 billion. Its total assets amounted
+to HKD197.899 billion and net assets amounted to HKD11.626 billion. Its profit for the year
+was HKD954 million. BOC Life maintained its leading position in the life insurance sector and
+remained the market leader in RMB insurance business in Hong Kong.
+BOC Life
+BOCG Insurance thoroughly implemented the Group's strategies. Centring on the Group's
+strategic development pattern of “One Mainstay, Two Engines", it developed the strategic
+positioning of "a regional high-tech property insurance company with market leadership and
+commercial bank characteristics". Leveraging the advantages of the Group, BOCG Insurance
+deepened bank-insurance coordination and pushed forward the transition from list marketing to
+in-depth development. It consolidated its advantages in traditional property insurance business
+alongside a focus on health insurance business, made efforts to shift from being a financial risk-
+taker to acting as a health manager, and rolled out an online application platform for its first
+personal health insurance product. BOCG Insurance continued to tap the potential of group
+clients and promoted the general application of its B2B2C marketing model. It advanced digital
+transformation across the board, officially launched a new-generation core system and developed
+peripheral systems in an orderly manner. Its online product system was also improved, with the
+"online insurance shopping mall” beginning to take shape. In 2021, BOCG Insurance launched
+online application platforms for five products, namely, “GoStudy Student Insurance Plan",
+"Motor Insurance-Private Car”, “Premier Home Comprehensive Insurance”, “Healthy Medical
+Comprehensive Protection” and “KeepMovIns Sports Insurance". It continuously streamlined
+and optimised its business processes, significantly improving customer service quality. It also
+improved its "Cloud Service” and offered an online green channel for clients to settle claims. It
+launched "Customs Clearance Series" and "Greater Bay Area Series" products and was among
+the first to complete the development of mandatory traffic insurance and commercial insurance
+products for Hong Kong private cars travelling to Guangdong, which have been duly filed
+with the Insurance Authority (IA). Furthermore, BOCG Insurance embraced ESG concepts and
+vigorously promoted green insurance, green investment and green workplaces.
+The Bank is engaged in general insurance business in Hong Kong through BOCG Insurance.
+As at the end of 2021, BOCG Insurance reported issued share capital of HKD3.749 billion,
+total assets of HKD9.980 billion and net assets of HKD4.407 billion. In 2021, BOCG Insurance
+recorded gross written premiums of HKD2.727 billion and realised a profit for the year of
+HKD226 million. Its gross written premiums continued to be at the forefront of the general
+insurance market in Hong Kong, while its premium quality was higher than the market average.
+BOCG Insurance
+Insurance
+60
+80
+BOC Wealth Management implemented the Group's "One Mainstay, Two Engines" strategy,
+achieved sound success in business development, and steadily increased its contribution to the
+Group. As at the end of 2021, its total assets under management reached more than RMB1.71
+trillion, up 23.17% compared with the prior year-end. BOC Wealth Management continued to
+expand its product line, establishing the five major investment categories of cash management,
+fixed income, fixed income plus, hybrid, and equity products. This product line covered all
+mainstream product structures, terms and strategies, thus realising strong performance and
+creating value for investors. It also developed products focused on the "Eight Priority Areas
+for Enhancing Financial Services", supporting high-quality development in fields such as
+technology finance, green finance and inclusive finance. BOC Wealth Management actively
+participated in the Bond Connect programme between the Chinese mainland and Hong Kong,
+launching a series of Cross-border Wealth Management Connect products and fixed-income
+Southbound Bond Connect products. Its foreign currency and cross-border products ranked first
+in the industry in terms of both product variety and total balance. BOC Wealth Management
+also achieved breakthroughs in expanding its third-party sales channels, realising product sales
+at twelve bank institutions and attracting over million customers from third party sales channels.
+At the same time, it continued to improve its asset allocation, and its investment in strategic
+emerging industries grew by 77% compared with the prior year. BOC Wealth Management
+steadily promoted the development of its comprehensive risk management system, ensuring that
+its business development was in accordance with regulatory requirements and risk prevention was
+successful and effective.
+The Bank is engaged in wealth management business in the Chinese mainland through BOC
+Wealth Management. BOC Wealth Management's business includes wealth management
+products for the general public, wealth management products for qualified investors, advisory
+and consulting, and other asset management-related products and services. As at the end of 2021,
+BOC Wealth Management's registered capital was RMB10.000 billion, its total assets amounted
+to RMB14.429 billion and its net assets totalled RMB13.082 billion. In 2021, BOC Wealth
+Management's profit for year reached RMB2.609 billion.
+BOC Wealth Management
+BOCIM steadily expanded its asset management business, continuously improved its profitability,
+maintained sound risk management, constantly improved its brand and market reputation, and
+further enhanced its comprehensive strengths. BOCIM expanded its business and focused on
+the field of green finance, issued an interest rate bond index fund linked to Shanghai Clearing
+House, and actively promoted the implementation of low-carbon themed funds, ESG China bonds
+and other fund products. BOCIM strengthened investment research and fund issued in science
+and technology related sectors, promoted the take-up of "specialised, refined, featured and
+innovative" themed products, and provided fund products to help investors share in the growth
+of science and technology. Building on its “The Global Manager of Global Assets" brand, it
+laid out various fund products such as Hong Kong stock connect funds, QDII funds and mutual
+recognition funds. BOCIM accelerated the issuance of new funds, launching 18 funds during the
+year. As at the end of 2021, BOCIM's AUM reached RMB499.3 billion. Specifically, its public-
+offered funds reached RMB398.3 billion and its public-offered funds excluding money market
+funds reached RMB286.6 billion.
+BOC-Samsung Life maintained rapid business growth, realising a year-on-year increase of 35%
+in annual premiums and continuously sharpening its market competitiveness. It improved its
+business structure, developed its long-term savings and protection business and realised a year-
+on-year increase of 99% in first-year premiums of high-value regular policies. BOC-Samsung
+Life continued to expand its online and offline business channels by launching an online
+insurance mall on WeChat and establishing new provincial-level branches in Liaoning and Anhui
+province. It accelerated digital transformation, established an online insurance ecosystem and
+completed the deployment of a private cloud. Other basic platforms completed include a data
+middle office and an open ecological platform, etc. BOC-Samsung Life deepened its technology
+empowerment, launched artificial intelligence (AI) applications such as customer service AI
+and pre-underwriting AI to realise 24/7 self-service for mobile customers, and comprehensively
+promoted online and intelligent services. Sticking to its core purpose of providing insurance
+services, BOC-Samsung Life launched “BOC ZunXiangJiaChuan Whole Life Insurance", "BOC
+AiJiaBao (21 Edition) Specific Diseases Insurance”, “JianKangXing Critical Illness Insurance
+(internet business exclusive)", "ShouHuXing Medical Insurance (internet business exclusive)"
+and other featured products, and expanded the insurance coverage of 16 products to include
+COVID-19. In the 2021 Golden Censer Prize, BOC-Samsung Life won "Excellent Life Insurance
+Company” for a consecutive year. It was also awarded the “Annual Technological Innovation
+Prize" at the Sixth China's Insurance Industry Ranking 2021 organised by National Business
+Daily, and was honoured with the "Excellent Social Venture" award at the Eighth CSR Summit of
+Financial Enterprises organised by XinhuaNet, and the "2021 Most Valuable Enterprise in ESG
+Investment" award at the Fourth Summit Forum on CSR in China held by International Financial
+News under People's Daily.
+Investment Business
+BOCG Investment
+The Bank is engaged in direct investment and investment management business through
+BOCG Investment. BOCG Investment's business scope includes private equity investment,
+fund investment and management, real estate investment and management and special
+Financial Technology
+BOC Consumer Finance received many awards from authoritative industry publications during
+the year, including the "Tian Ji Award 2021 Outstanding Consumer Finance Company”
+from Securities Times, "2021 Financial Institution Practicing Inclusive Finance with Excellent
+Competitiveness" from China Business Journal, and "2021 Reassurance Award Consumer
+Finance Brand" from Jiemian.com, Shanghai United Media Group.
+Upholding the philosophy of “building a high-quality consumer finance company in the new era”,
+BOC Consumer Finance fulfilled its responsibilities and obligations as a state-owned licensed
+consumer finance company. Driven by technological applications, it continuously improved its
+customer service capacity through technological empowerment, thus safeguarding the legitimate
+rights and interests of its customers. As at the end of 2021, BOC Consumer Finance has set up
+27 regional centres, covers about 400 cities and 900 counties nationwide through its offline and
+online businesses, and has created an integrated operation platform featuring the integration of
+"online + offline" and "finance + technology". BOC Consumer Finance registered a loan balance
+of RMB52.435 billion, an increase of 56.9% compared with the prior year-end. Preliminary
+achievements were made in the online migration of loans, with the balance of online loans
+accounting for 35.06% of all loans, an increase of 28 percentage points compared with the
+prior year-end. Placing equal emphasis on consolidating its foundations and pushing forward
+transformational development, it strived to develop its business ecosystem and enhance its
+technological and risk control capacities.
+The Bank is engaged in consumer loan business in the Chinese mainland through BOC Consumer
+Finance. As at the end of 2021, BOC Consumer Finance's registered capital stood at RMB1.514
+billion, total assets amounted to RMB54.326 billion and net assets were RMB7.862 billion. In
+2021, it recorded a profit for the year of RMB844 million.
+BOC Consumer Finance
+Consumer Finance
+85
+555
+Following the strategic objectives of the Group, BOCL focused on national strategic regions
+and key industries, upheld the development philosophy of specialisation, differentiation and
+featured characteristics, highlighted the featured characteristics of financial leasing, and refined
+and strengthened its leasing brand. BOCL's leasing business involved transportation, water
+conservancy, energy production and supply, construction, manufacturing and other industries,
+taking practical steps to improve the quality and efficiency of its service to the real economy.
+As at the end of 2021, BOCL had conducted a cumulative total of more than RMB40 billion
+of financial leasing business, specifically, the proportion of green leasing in the total leasing
+business was 28%.
+The Bank is engaged in financial leasing, transfer and receiving of financial leasing assets and
+other related businesses through BOCL. As at the end of 2021, BOCL recorded registered capital
+of RMB 10.800 billion, total assets of RMB37.214 billion and net assets of RMB 10.684 billion. It
+recorded a profit for the year of RMB34 million.
+The Bank is engaged in financial technology innovation, software development, platform
+operation and technical consulting services through BOC Financial Technology. As at the end of
+2021, the registered capital of BOC Financial Technology was RMB600 million, with total assets
+and net assets standing at RMB988 million and RMB658 million respectively.
+BOCL
+BOC Aviation is engaged in the aircraft leasing business. BOC Aviation is one of the world's
+leading aircraft operating leasing companies and is the largest aircraft operating leasing company
+headquartered in Asia, as measured by value of owned aircraft. As at 31 December 2021, BOC
+Aviation recorded issued share capital of USD1.158 billion, total assets of USD23.879 billion
+and net assets of USD5.266 billion. It recorded a profit for the year of USD561 million, as the
+Company recognised the effects of the COVID-19 downturn on the value of its aircraft and on
+airline customer cash flows and receivables.
+BOC Aviation
+Leasing Business
+84
+BOC Asset Investment conducted debt-for-equity swap business based on market-oriented and
+rule-of-law principles, with the aim of improving enterprises' business operations and helping
+them to reduce leverage ratios and enhance market value. Committed to the development of green
+finance, it raised social investment capital by private equity investment funds for debt-to-equity
+swaps to implement a number of debt-to-equity swaps projects of enterprises in new energy
+industries including wind power, photovoltaic and waste incineration power generation, achieving
+economic, environmental and social benefits. BOC Asset Investment supported the healthy
+development of high-quality emerging technology enterprises, improving their performance by
+meeting the growing technology enterprises' equity financing demands with debt-for-equity
+swap projects. BOC Asset Investment also orderly coordinated the Group's non-performing
+assets disposal work by means of shareholding platforms and so on, serving as a professional and
+experienced platform for risk asset restructuring. As at the end of 2021, the Bank's cumulative
+market-oriented debt-for-equity swap business reached RMB186.068 billion, representing an
+increase of RMB27.266 billion during the year.
+The Bank is engaged in debt-for-equity swap and related business in the Chinese mainland
+through BOC Asset Investment. As at the end of 2021, the registered capital of BOC Asset
+Investment was RMB14.500 billion, with total assets and net assets standing at RMB84.868
+billion and RMB17.966 billion respectively. In 2021, it realised a profit for the year of
+RMB2.050 billion.
+BOC Asset Investment
+BOCG Investment actively coped with the complex environment with repeated resurgence of
+the COVID-19 pandemic and capital market fluctuations, implemented the “One Mainstay, Two
+Engines" strategy, integrated into the nation's new development pattern, brought into full play
+its advantages in integrated operations, and pushed forward transformation and development.
+Centring on technology finance and green finance, BOCG Investment increased investment in
+technology enterprises, focused on investing in “specialised, refined, featured and innovative"
+small and medium-sized enterprises, and organised research and investment in clean energy,
+new-energy vehicles, green technology for traditional industries and other fields in line with
+the national goal of "carbon peaking and carbon neutrality”. It invested in such projects as
+SVOLT Energy Technology, Shenzhen New Degree Technology, XParadigm, NASN Auto,
+MediTrust Health, Xingshengyouxuan and Hzymes Biotech, and successfully exited from certain
+existing investment projects. It issued its first USD600 million green bond and made progress in
+establishing the second tranche of the Yangtze River Delta Fund and the second tranche of the
+Greater Bay Area Fund. It also provided support for the growth of Hong Kong-based science
+and technology innovation enterprises, focused on the construction and investment opportunities
+arising from the development of the Northern Metropolis Plan, and played its role as a Chinese
+enterprise in the economic and social development of Hong Kong.
+situation investment. As at the end of 2021, BOCG Investment recorded issued share capital of
+HKD34.052 billion, total assets of HKD142.171 billion and net assets of HKD74.798 billion. In
+2021, it recorded a profit for the year of HKD6.906 billion.
+83
+Committed to pursuing sustainable growth, BOC Aviation continuously implemented its
+proactive business strategy and steadily promoted its standing in the aircraft leasing industry.
+Actively supporting the Belt and Road Initiative, it had leased 64% of its aircraft to airlines
+of Belt and Road countries and regions as at the end of 2021. Continuing to closely develop
+customer demand, the Company took delivery of 52 aircraft, including seven aircraft that airline
+customers purchased at delivery, as it expanded its owned fleet. All of these aircraft have been
+placed on long-term leases. During the year, BOC Aviation signed 74 leases and added five new
+customers, totalling 86 customers in 38 countries and regions. BOC Aviation consistently sought
+to optimise its asset structure and improve its sustainable development. It sold 23 owned aircraft
+during 2021, leaving it with an average owned fleet age of 3.9 years (weighted by net book value)
+as at 31 December of 2021, one of the youngest aircraft portfolios in the aircraft leasing industry.
+89