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Edited Transcript of 601398.SS earnings conference call or presentation 30-Mar-17 8:40am GMT

Thomson Reuters StreetEvents

Full Year 2016 Industrial and Commercial Bank of China Ltd Earnings Call (Chinese, English)

Beijing May 10, 2017 (Thomson StreetEvents) -- Edited Transcript of Industrial and Commercial Bank of China Ltd earnings conference call or presentation Thursday, March 30, 2017 at 8:40:00am GMT

TEXT version of Transcript

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Corporate Participants

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* Yi Huiman

Industrial and Commercial Bank of China Ltd - Chairman

* Gu Shu

Industrial and Commercial Bank of China Ltd - President

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Conference Call Participants

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* Jie Huang

CICC - Analyst

* Sophie Jiang

Nomura - Analyst

* Editor

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Presentation

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Gu Shu, Industrial and Commercial Bank of China Ltd - President [1]

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(interpreted) (audio in progress) business transformation and innovation. As usual, the 2016 results has been disclosed on the website of Hong Kong and Shanghai Stock Exchange. You can check the website for further details. This meeting will have two sides in Hong Kong and Beijing -- connected with video conference, so as that the global investors and analysts will know our information. You can also dial in via international conference call.

First, I would like to introduce the senior management attending the meeting today. At Beijing site, we have Mr. Yi Huiman, Chairman of the Board, Executive Director of the Board; Senior Executive Vice President Mr. Zhang Hongli; Chief Risk Officer, Mr. Wang Bairong; Head of the Board Officer and GM of Corporate Strategy and Investor Relations, Mr. [Chao Ching Sung]; GM of Assets and Liability Management Mr. Zhu Changfa. At Hong Kong site, we have President of the Bank Mr. Gu Shu, myself, General Manager of Credit and Investment Management, Mr. Wei Xuekun; General Manager of Financial Accounting, Mr. [John Won Wu].

Now in the first session, I'm going to give a brief introduction of the financial highlights of ICBC in 2016. In the following aspects, you will see that ICBC has maintained stable performance. And the highlights here number one, the net profit keeps growing. The bank realized net profit RMB279.1 billion or $40.2 billion equivalent up 0.5% year-over-year. Still we are the most profitable bank in the world. PPOP RMB451.2 billion, up 0.2%, best among the comparable peers. ROWAE 15.24%, ROAA 1.2%, still among the highest in the world. Number two, smallest and main contraction due to delicate pricing management. Net interest margin reports 2.16% it's putting side impact of the VAT reform down only by 21 bps year-over-year, better than our peers and within our anticipation. Number three, improved profit structure with highest fee and commission income among peers. In 2016, the net income of investment and fee and commission account for 46.3% of all the revenue. It is [several point] -- 5.4 percentage points higher than the previous year. The total fee and commission income achieved RMB145 billion highest among our peers.

Number four, better asset quality and risk and mitigation. By the end of the year 2016, the NPL balance of ICBC RMB211.8 billion. The newly formed NPL was RMB22.7 billion less than the previous year. NPL ratio is flattish with Q3, 1.62%. Provision nearly charged 86.1 bps up 0.1%. Total provision balanced RMB289.5 billion. Provision ratio is higher than the end of Q3 to 136.69%.

Number five, better cost control and improved efficiency. ICBC implemented a strategy of lighter, smaller and more intelligent bank, reduced the number of our outlets. The overhead has been down by 1.5% year-over-year. Cost to income ratio 27.4% and that's also among the best among our peers.

Number six, diversified way of using credit resources. In year 2016, ICBC granted RMB1.12 trillion new loans, up by 9.4%. RMB2.18 trillion granted loans were paid back and given to new customers making actual new loans RMB3.3 trillion. Project loans led growth RMB273.3 billion and the net growth of personal mortgage loan is RMB724.6 billion. Non-credit financing RMB2.54 trillion and non-credit financing and local government bond investment growing by RMB1 trillion.

Number seven, deposit base getting better and structures better. By the end of 2016, customer deposits achieved RMB17.8 trillion, up 9.5%. Both incremental balance and growth rate are the best in the past two years. And the domestic demand deposits accounting for 51.94% up 1.93 percentage points higher than the previous -- the end of the previous year. The daily average deposit incremental is over 50% showing better stability. Number eight, solid capital base. Under advanced measures of capital requirement, the CET 1 ratio of ICBC 12.87%, Tier 1 capital ratio and the capital adequacy ratio is 13.42% and 14.61%. So, we have enough buffers.

Number nine, our investment in the International Banking and the Universal Banking sees more returns. By the end of last year, our ICBC global network covers 42 countries and territories with overseas institutions 412 and realized net profit of $2.55 billion accounting for 6.3%. And non-commercial banking subsidiaries has reported [RMB6.11 billion] up 7.5%.They are contributing more to the Group's revenue. [Among] ICBC Credit Suisse has realized RMB1.64 billion in net profit, up 27.1% and becoming the second largest in public [firm]. Its AUM is over RMB1 trillion. ICBC leasing realized RMB3.42 billion in net profit. ICBC AXA net profit RMB500 million, up 11.6%.

Number 10, the FinTech is greater itself, the online shopping mall has this transaction number over RMB1 trillion, our communication and application has 60 million customers and the rest banking has customer of around 250 million. The QR code in [V PAY] has over 100 million users and e-online investment has over RMB500 billing. Therefore, we have a online and offline combination of the financial services capability and this was brief introduction of our annual results The first highlight is about our net interest spread. I recommend that analysts could pay attention to that. It reflects our good sense and effective management of our pricing and the compression of net interest spread is led by 10 basis points compared with our peers.

The second highlight is about the proportion of fees and commission based income in our total income. It reflect that we're having a good development in terms of retail business, private banking business, credit business, precious metal business et cetera. In all the above business lines, we are doing better than our peers.

The third highlight is that in the fourth quarter of the year 2016, we are having better asset quality. In terms of the gap between overdue loans and non-performing loans and in terms of non-performing loans ratio, we are changing for the better. We have the phase that in the first quarter of 2017, we will continue this trend.

The fourth highlight is about the structure and direction of our credit business, it is most in line with the government's reform on the supply side and also in line with our general strategy. And we're tracking very good results from the change of our structure and it also point out a clear direction for our future development.

The fifth highlight is about our deposit. The cost for our deposit funding is quite low and we are having pattern -- general amount under the structure in terms of deposit and it also point out the new way for our future and this year compared with the previous years, we are having the best competitiveness in terms of deposits.

The sixth highlight is not reflected on our Annual Report, but I want to stress that we are having a better structure in terms of human resources. ICBC has a large base of human resources, indeed facing the trend of financial technology, our human resources are now having two forms in terms of flow and in terms of distribution. We are having the optimization of the structure of human resources and we've removed a lot of people from the counter and make them customer relations managers. And in the total amount of human resources, we only have 1% less of total employees, but the structure of the employees have changed by [6%]. So, from this aspect, we are having better competitiveness in terms of human resources and we are having better measures through chosen risk. So, I'll give the floor back to Mr. Huiman.

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Questions and Answers

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Jie Huang, CICC - Analyst [1]

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(interpreted)I'm Jie Huang from CICC. I'd like to first congratulate the Chairman, Yi and his team on the good results for last year, but we also observe that the development of Chinese banking sector is quite homogeneous and what's your personalized interpretation of ICBC as the Captain of the largest bank in the universe.

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Yi Huiman, Industrial and Commercial Bank of China Ltd - Chairman [2]

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(interpreted)Thank you, I'll take your question. ICBC have been formed for 33 years. And after the 33 years of development, especially after the -- our IPO 10 years ago, we have some of our special ICBC hallmarks. I also have been serving with ICBC for 33 years. And if I would like to share some personal interpretation of ICBC, I would like to say the following, first ICBC is a bank operating with prudence and good sense. That is the culture of ICBC, the foundation of our lasting prosperity of ICBC as well as the core investment value. For example, we have very good mechanisms and systems in terms of corporate governance, risk management and capital management, so as to stand the test of business cycles and secondly for another example in terms of asset and liability, we have quite strong loan to deposit ratio and we also have hold [account] by RMB4 trillion, that is quite liquid, in terms of development and innovation, we pay attention to the leverage, pay attention to the change of the business lines and we have been quite sound and prudent in terms of risk management. So prudence is indeed the life line of ICBC. We also do our business with good sense, good sense is reflected in terms of our business operation targets, in terms of our pricing of interest rate, in terms of our innovation and also in terms of our incentive mechanisms and that is the weapon for our long-term and sustainable development. And as long as I am the Chairman of the bank, I think, we'll stick to the principle of prudence and good sense. Secondly, ICBC operates with city branches at its core. Take Beijing branch, for example, in last year, Beijing branch have registered a profit before provision with RMB45.6 billion and its profit -- net profit is RMB33.6 billion. It is similar to the scale of a private bank or a nationwide private bank, and we also have many city branches similar to Beijing branch. In our largest, 80 city branches, they account for the 90% of our total profit, 74% of our total deposit and 76% of our total credit. Thirdly, ICBC ranks with cost as its cornerstone; since the liberalization of interest rate, the competition between banks is actually the competition of costs with if the cost is competitive, we can be more competitive in terms of our total business operation. So in terms of cost, we are paying attention to the risks and the management of -- to have refined management and we're having sound management and control over the cost, so that our cost is better than average among peers. Fourthly, ICBC is a bank with innovation as its engine for further development. ICBC is big but it's also vigorous. First, we are the first to realize the central concentration of data, then we are among the pioneers to have asset management business. We explored the building of profit centers and then we begin to develop Internet finance. We are also among the first to embark on the comprehensive business development and the first to embark on international development. These are examples to show that ICBC is a bank with vigorous innovation. Fifthly, ICBC pays a lot of attention to human resources, ICBC's human resources is marked by the features of dedication and professionalism. We have quite some good leaders with quite good proficiency and our employees are all very dedicated to their work. That is why after 30 years of development, ICBC could achieve the results today and if you want me to characterize ICBC, these are the five hallmarks I would like to mention to you. Thank you again for the question.

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Unidentified Company Representative [3]

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Thank you, Chairman, Yi and second question comes from Hong Kong.

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Unidentified Participant [4]

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(interpreted) Thank you for giving me this opportunity and name is [Xiaoyuan] with UBS. As I'm interested in the future development of ICBC and we know that last year, the new senior management has taken office and we are interested in your vision and expectation of ICBC's future development. Could you share with us the specific strategies of ICBC. Thank you.

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Yi Huiman, Industrial and Commercial Bank of China Ltd - Chairman [5]

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(interpreted) I'll answer your question. [TOD] fourth quarter of last year, the new senior management team is finally in place. The new senior management team is quite professional, dedicated, they are quite young and they joined the assets. That is the foundation for our future development.

The new leadership is working on the new 3-year development plan. The target is for ICBC to become largest in terms of scale to have the best of profit, to be a safe and prudent bank, to be a bank with innovation, to be a bank with customer satisfaction, and to be a bank with human resources at its center.

We will deal top levers with the relationship between tradition and innovation, because in the past decades since our IPO, we have achieved very good results but actually the environment is changing and we need to accelerate our innovation to do better in the future.

Specifically, we will focus on our strategy on city branches, under the economic new normal, the major cities are the areas which suffer the least from the economic cycle. This is where we need to have focus our main efforts. (Interpreted) Secondly, we will further implement our three major strategies, namely the strategy on retail bank and the strategy on asset management and the strategy of investment banking. In terms of the strategy on retail banking, retail business is our cornerstone and the [stabilizer] of our business. Last year, the contribution of retail business is about 40% and in the next several years, we wanted to improve by two to three percentage points each year, and we do value the business of retail. As for asset management strategy, actually nowadays, the customers would like to have less about it, but rather more wealth management products and our asset management strategy is in line with such a trend. And in terms of investment banking strategy, it is the trend for our future corporate business. We use the provider of credit, but in the future, we would like to provide comprehensive business services to our corporate customers. Thirdly, we will focus on our IT strategy. Actually, we will use data and information to provide a better credit, better risk management and better management and deliver better service to our customers, especially the young customers and the future customers. We will build a smart bank to fit the needs of the Millennials, so as to provide service according to their requirement. Four, we will focus on our customer service. Although a lot of businesses have been transformed to online these days, but we will not forget our 0.5 billion customers offline. Last year, we still have 0.7 customers going to our brick and mortar outlets. And each day and last year, the counters at the brick and mortar outlets transacted RMB0.2 trillion businesses transactions. And brick and mortar outlet is where we need to build our brand and where we need to form our reputation. We will not forget our offline service.

Fifth, we will further carry out the strategy on comprehensive development and international development. We will have more detailed international development strategies and we will increase the width and depth of our comprehensive business development, so that they could contribute more to the whole Group. And I also want to say something about how we are going to carry out our strategies. We will improve the abilities in four terms. The first ability to serve the real economy, we will improve our ability to serve the traditional customers and new customers to provide innovative business and we also deal with the relationship between service provision to big, small and medium-sized customers. The second ability is the ability to manage and control the risk and to find the chaos in the financial area and play a good role of major bank as the market stabilizer. The third ability is about the ability to transform our business. We will maintain our two advantages. The first advantage being our advantage of interest spread and the second advantage being our fees and commission based income. And the fourth ability is the ability to carry out our strategies, so that we can be more vigorous in the future.

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Unidentified Company Representative [6]

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(interpreted) Thank you, Chairman, Yi. Now, I'd like to give the floor to the friends from the conference call.

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Unidentified Company Representative [7]

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The question comes from Sophie Jiang of Nomura.

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Sophie Jiang, Nomura - Analyst [8]

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(interpreted) Thank you for giving me this opportunity and as Chairman, Yi has mentioned about it, I'd like to hear more elaboration on this point and particularly the changes since the quarter -- fourth quarter of 2016, while we're looking into 2017, we're hearing more tightening signals from the PBOC be it in terms of the monetary currency or the NPA and we have also noticed that there is a rising trend of the interbank interest rate and also the high credit demand on a real economy, so ICBC is abundant in liquidity and also has sound foundation of deposits, how do you perceive the development trends of NIM this year? Do you think there will be any possible rebounds of NIM? Thank you.

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Unidentified Company Representative [9]

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(Interpreted) I will ask Mr. Gu from Hong Kong to answer this question.

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Gu Shu, Industrial and Commercial Bank of China Ltd - President [10]

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(Interpreted) Thank you for your question, as we have noticed in the briefing just now, the NIM of last year stood at 2.16%, which was 31 bps down compared to the NIM of the previous year. And with respect to the 31 bps down, I would like to mention two points. First, 26 bps of course took place in the first half year in 2016 that means in second half including the fourth quarter, NIM was down only by five bps. The second point is that compared to our peers, the compression of our NIM was 10 bps less than the peers which was mentioned by Chairman, Yi, right at the beginning of this announcement. For the first point, since the end of 2014, PBOC has conducted six consecutive interest rate cuts and that leads to six consecutive repricing of the loans and deposits. However, we noticed that the repricing for loans was faster than that of the deposits, and it is the same situation with our peers, that is to say, the NIM shrank faster in the first half year then the second half. And for the second point, I should thank all the colleagues from headquarter to the colleagues at all levels, due to their hardworking and efforts. On asset side, we did a lot of work on to credit extension, investment in bonds, and allocation of assets also including the reserve in the PBOC. And because of the works we have down, we achieved the highest yield on asset side than our peers. And on the liability side, we didn't participate in or launch in a price war, but instead, we tried our best to provide better products and service to our customers, so that we can attract more of them and consolidate the customer base.

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Unidentified Participant [11]

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(interpreted) And you also mentioned about the trend of NIM's development in 2017. And we also noticed that the currency policy of PBOC is said to be moderate and prudent and that is good news for the stabilizing of the NIM.

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Gu Shu, Industrial and Commercial Bank of China Ltd - President [12]

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(interpreted) From year-to-date and we have seen the improving trends of the interest generating assets including investments and loans and we are stabilizing the funding cost of the deposits. And up to now, according to our rough estimate, the NIM should be kept at the same level basically with that of quarter four of last year. And so, we're seeing and signs of further compression of NIM and in the coming three quarters, there will be a stabilizing NIM. Thank you.

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Unidentified Company Representative [13]

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(interpreted) Thank you President, Gu. Now, the second question from the conference call.

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Unidentified Company Representative [14]

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(interpreted) The question from --

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Unidentified Participant [15]

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Thank you for giving this opportunity. And my question is about the NPL of ICBC, could you add more color to the asset quality of ICBC in 2016? And in which industries and regions are NPLs of ICBC mainly distributed? What about the gap between overdue loans and NPL and nowadays, many financial institutions including some banks claim that there has been a turning point of the asset quality has arrived. And as ICBC is famous for its prudence and stability in risk control, how do you perceive and how do you comment on such a claim? Thank you.

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Unidentified Company Representative [16]

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I'll ask President, Gu to answer this question.

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Gu Shu, Industrial and Commercial Bank of China Ltd - President [17]

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(interpreted) I will first elaborate on asset quality of our bank from NPLs balance, the balance of NPL of 2016 stood at RMB211.8 billion up by RMB32.3 billion YoY, however, the growth was RMB22.7 billion compared to that of the previous year. And from distributions, from the perspective of industries, the NPL are mainly concentrated in retails and the wholesales and also the low end manufacturing industries and from the point of regions mainly concentrated in the Pearl River Delta and the second Bohai Sea area. Around industries, it is mainly because of the economic restructuring and the industries including the manufacturing and retail selling and wholesales are vulnerable to the economic volatility. And from the regions, the NPL's rise is mainly concentrated in the Pearl River Delta and Bohai region. However, when we look into the future, we believe that the risks in these areas are both controllable. And for the western and the middle part of China, the NPL remain stable but for Yangtze River Delta region, we believe that there -- it's changing for the better. And he also mentioned about the gap between overdue and NPL and the balance of the gap of 2016 was RMB134.3 billion down by RMB18.9 billion YoY and we hope carry on such good momentum this year. And the last point is about whether the turning point of asset quality has arrived. Now, I'd like to offer you some statistics. And from the perspective of NPL formation that is the formation ratio, among the four quarters of last year, quarter one reaches to the highest amount and for the second quarter only 83% of the total amount of newly formed NPL in quarter one. And the third quarter maintained basically the same level. However, for the fourth quarter, the number was only 78% of the quarter one. And up to now for the first quarter of this year, we have noticed an improving trend for the NPL formation rate. On a point of overdue loans, it is still the same that the quarter one of last year reaches the highest amount of the overdue loans and quarter two accounted for only 89% of that in quarter one. Quarter three and quarter four of last year maintained at the same level, accounting for only 83% of quarter one. And from the data above, my conclusion is that things are turning for the better and the turning point is not far away from us. Thank you for your question.

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Unidentified Company Representative [18]

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(interpreted) Thank you, President, Gu. Due to the limited timing, now lastly, two questions and first from the Beijing conference room.

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Unidentified Company Representative [19]

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(interpreted) May I first from Chairman, Yi, may I first add something about asset quality. Actually, we believe that we're seeing the twilight for the turning point of asset quality in banking business.

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Unidentified Participant [20]

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(interpreted) I want to ask a question about financial technology. Actually, I am [Yong Liu] with CITIC Securities. We all know that we have [400] Millennials, they are becoming the mainstream of consumption in the financial market. They tend to leave the bank counter for Internet platforms. This trend bring challenges possibly also opportunities for a traditional bank like ICBC and I think, ICBC has always been a pioneer in terms of financial technology. And the last Chairman as well as Chairman, Yi both pay a lot of attention to the development of FinTech. And some also call Chairman, Yi as China's version of Steve Jobs. So my question is that what's the future development plan for ICBC in terms of FinTech?

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Yi Huiman, Industrial and Commercial Bank of China Ltd - Chairman [21]

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Thank you for your question, you're right in saying that we have so many Millennials and we're paying a lot of attention to this Millennials and to deliver proper service to them is part of our strategy. This young customers grow up playing with iPad, so they don't tend to come to the brick and mortar banking offices to wait on long queue for their business to be done. So they basically need more customize their financial services and we indeed to do a lot work to provide a better service and to have more measures to acquire new customers and deliver service to them. Indeed compared with those financial technological companies, traditional banks are still lagging behind in terms of the convenience of service provision, a fact rapidity of service provision in the provision of that scenario and in terms of our openness that pushed by the trend of FinTech, Chinese banks are doing a lot of changes and working hard on this area, for example, ICBC has launched its e-ICBC 1.0 version and 2.0 version. We are having a lot of good results as well. We also have quite some very good products such as ICBC e-Payment, ICBC Easy Loan and ICBC EZ-Link. All these products are having a lot of customers, actually more than 0.1 billion customers. And Easy Loan has already become the largest online credit issuance platform with business volume of RMB648 billion. Actually, in terms of FinTech development, we need to combine online and offline service provisions. Indeed, and we also need to maintain the advantages as a bank. The essence of FinTech is [still] finance and the provision of financial business cannot be delivered without offline channels and we will do a good job in building the online and offline synergy and provide better capital and provide better brand and reputation. In the future, first, we will further optimize trade platforms and the one online credit issuing center. Secondly, we will do about good job in building better systems and mechanism with respect to the laws of the business. And thirdly, we will provide better customer experience and pay attention to the cooperation in our products to make our products more open and more accessible. And best [place] our thinking and measures to do a good job in FinTech in the future. And actually, we are doing a lot of work in developing the new smart bank system that is where we need to pay attention in this year. Indeed, I have several words to share with you that is my thinking about the development of FinTech. First, we will speak to the essence of finance, we will not follow blindly what the media is saying these days. And secondly, we will bring out changes according to our demand to guide our further business operation. We will not forget our nature as a bank, not forget our advantage as a bank. We will pay attention to our large customer base and pay attention to our IT advantage to further bring better service for the young customers and future customers. Indeed when the society is having less and less cash in daily transactions, it is actually a good sign for the society and this is where we need to work as well as the third-parties and this is where we can do our job to promote the social civilization for our society, but we should always remember that the essence of banking business is the management of risk. This is what we need to remember in the development of financial technology. Indeed ICBC is a traditional bank and we will keep our vigor by means of change and we will also take our market share by means of innovation. Indeed, nowadays, we hear a lot of voices from the media saying that banking business will die and banks are cutting their employees. We hear lot of such voices and indeed, we realize that, that's a result of capital. Capital can cause a lot of noises in the market and cause a lot of symmetry of information, but generally speaking, we have full confidence in ICBC's tradition as a commercial bank and we also have the faith in changes in the financial technology. Thank you for your question.

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Unidentified Company Representative [22]

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Thank you, Chairman, Yi. And the last question comes from --

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Unidentified Participant [23]

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(interpreted) Thank you for giving me this opportunity, my name is [Lu Qing] with Goldman Sachs, and when we look back into past 10 years, we see there has been a great changes in the profit mix and the income sources of ICBC, and I can (inaudible) delivered by the transformation and but if we take a look into the future, what do you think will be the engine for the profit growth? Thank you.

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Unidentified Company Representative [24]

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I'll ask President, Gu Shu to answer this question from Hong Kong.

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Gu Shu, Industrial and Commercial Bank of China Ltd - President [25]

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(interpreted) Thank you for your question. It is always a difficult question coming from Goldman Sachs. And indeed, if you have observed, there has been great changes in terms of the profit mix and income sources of ICBC and these are the results brought by the transformation conducted by us and they can divided into two lines. The first line is that we want our profit mix to be more balanced and diversified and not just relying on the interest spread. And for example the fee and income has now accounted for 23% to 24% of all the operating income. And we have maintained our leading position among the peers in this aspect. And this is emphasized by Chairman Yi, at the beginning. And our strategies of internationalization and diversification are all devoted to this purpose. And for the second line, in the past, most of our business consumed lot of capital, but nowadays, we are transferring to the capital saving businesses. If we take a look on the structure of the balance sheet, we can notice that we have scaled up the investment in the bond and in many other non-credit asset businesses. So they are accounting for a large part of all the businesses. And for loans and the credit businesses, we are [starting] off the retail sellings and retail loans and in the past 10 years, such amount has doubled. You also mentioned about the growth points of ICBC in the future, indeed, we have considered a lot on this point and due to the limited time, I would like to just briefly introduce some points to you. First, we will carry on the strategies of the past 10 years and increase the proportion of fee and income in total operating income and we will provide better services to our customers. For example, asset management service as mentioned by Chairman Yi and these businesses have greater potentials in the future. And second, FinTech as mentioned by Chairman Yi, we want all the services to be more convenient and we want to create eight more scenarios for them and to make our services more open. And on surface, it looks like improvements of the services to customers but is also of vital importance to our sustainable growth. And it is also important method for us to conducted the customer retention so that we can have sustainable developments in the future. And the third is that we want to have a better integration of the commercial banking services and invest banking. Banks are to provide the financing services to the customers, however, nowadays the demands from our customers are diversified, they want low cost of funding but for banks, we also want a better balance sheet. And ICBC has comprehensive business lines, we can provide loans and many non-credit services and also services both on and off balance sheet and we can form our unique advantages meeting the diversified demands from our customers, our businesses is not only confined to the domestic area but also extended to the overseas market and we can also have a lot of information sources to help our customers locate the information, to provide consultation to them and help them solve the financial needs, so we are more conditioned to combine both the commercial banking and investment banking to provide value added services to our customers. And thank you for your question and I hope that my answer is satisfactory.

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Yi Huiman, Industrial and Commercial Bank of China Ltd - Chairman [26]

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(interpreted) Thank you, President, Gu and so much for the Q&A session and thank you the analysts and investors for your participation and if you have any further questions, the IR team and other departments of ICBC will be more than happy to take your questions and have exchanges of ideas with you. We hope, you can continue to support us and we will try our best to bring better performance and returns to our investors. So much for today's results announcement. Thank you.

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Editor, [27]

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Portions of this transcript that are marked (interpreted) were spoken by an interpreter present on the live call. The interpreter was provided by the Company sponsoring this Event.