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pww.comBank of China Limited, 2023 Earnings Call, Apr 02, 2024 - SEHK:3988

SEHK:3988

Yu Ke [Executives] 💬

During the earnings call transcript, Yu Ke, one of the executives, makes several announcements and moderates portions of the event. Here is a detailed list of what Yu Ke has said:

Opening Remarks

  • Yu Ke introduces themselves and mentions their new role within the company.
  • Expresses the desire to have more dialogue with the press and provide better services.

Media Question and Answer Session

  • Invites media friends from the Hong Kong venue to ask questions.
  • Directs a question about serving the real economy to President Liu.
  • Directs a question about the personal finance business to Vice President Lin Jingzhen.
  • Directs a question about digitalization to Chief Information Officer Qian Meng.
  • Directs a question about global business and the internationalization of RMB to President Liu.

Closing Remarks

  • Thanks the management for responding to questions of interest.

  • Mentions that the 2023 Annual Report is available, highlighting the 5 commitments and 5 major roles outlined by Chairman Ge Haijiao.

  • Reiterates the bank's commitment to improving financial services, supporting high-quality development, serving high-level opening-up, putting people and customers first, mitigating and preventing financial risks, and deepening reform and innovation.

  • Emphasizes the bank's role in serving the real economy, maintaining financial stability, and being a responsible state-owned financial institution.

  • Requests continued support for the bank and expresses confidence in achieving high-quality development.

  • Announces the end of the results release.

Chengwen Zhuo [Company Secretary] 💬

Chengwen Zhuo, the Company Secretary of Bank of China Limited, made several statements during the earnings call. Here is a detailed summary:

  1. Opening Remarks:

    • Welcomed investors, analysts, and media to the Bank of China 2023 Annual Results Release.
    • Introduced himself as Zhuo Chengwen, Secretary of the Board of Directors of BOC.
    • Mentioned that he was co-chairing the event alongside Ms. Yu Ke, the spokesperson of BOC.
    • Noted that the conference would have venues in Hong Kong and Beijing, and would also be live-streamed.

  2. Introduction of Senior Management:

    • Introduced the senior management present at the Hong Kong venue: President Liu Jin, Vice President Zhang Yi, and Chief Risk Officer Liu Jiandong.
    • Introduced the senior management present at the Beijing venue: Vice President Lin Jingzhen and Chief Information Officer Meng Qian.
    • Mentioned the presence of Mr. [Yao Zhang Jian] as a representative of the Independent Directors at the Hong Kong site.

  3. Availability of Financial Information:

    • Announced that the bank's 2023 annual results were publicly available since March 28 and could be downloaded from the bank's official website or viewed on the live-streaming page.
    • Clarified that all financial figures presented were prepared using International Financial Reporting Standards (IFRS).

  4. Meeting Agenda:

    • Explained that the meeting would include both the presentation of annual results and a Q&A session.

  5. Invitation for President Liu to Speak:

    • Invited President Liu to speak on the operating results.

  6. Q&A Session:

    • After President Liu's presentation, opened the floor for questions.
    • Directed the first round of questions to the Hong Kong venue.
    • Addressed specific questions to President Liu, Vice President Lin, and Former Executive Director & EVP Zhang Yi.
    • Directed the next round of questions to the Beijing venue.
    • Addressed specific questions to Vice President Lin and Former Executive Director & EVP Zhang Yi.

  7. Closing Remarks:

    • Before ending the Q&A session, addressed a previously submitted question regarding capital and dividends.
    • Directed the question to Vice President Zhang Yi.
    • Invited Yu Ke to chair the Q&A session for media.

  8. Media Q&A Session:

    • Invited Yu Ke to take over and chair the Q&A session for media.
    • Passed the microphone to Yu Ke.

Throughout the earnings call, Chengwen Zhuo acted as the moderator, introducing speakers, directing questions, and facilitating the flow of the meeting.

Jin Liu [President & Executive Vice Chairman] 💬

Jin Liu, the President & Executive Vice Chairman of the Bank of China Limited, provided an overview of the bank's performance in 2023 and outlined its strategies for 2024. Here is a detailed summary of his statements:

2023 Performance Highlights

  1. Financial Performance

    • Operating revenue increased by 6.42% year-on-year.
    • Profit before provisioning increased by 3.68% year-on-year.
    • Profit after tax amounted to RMB 246.371 billion, up 4.07% year-on-year.
    • NIM (Net Interest Margin) was 1.59%.
    • Net fee income increased by 5.31% year-on-year.
    • Cost-to-income ratio was 28.5%, down 0.42 percentage points year-on-year.

  2. Asset and Liability Synergy

    • Asset scale reached CNY 32.43 trillion.
    • Liability scale reached CNY 29.68 trillion.
    • Growth rates were 12.25% and 12.7%, respectively.
    • The proportion of deposits to liabilities rose by 0.47 percentage points.

  3. Risk Resilience

    • Nonperforming rate was 1.27%, a steady decline from the end of the previous year.
    • Provision coverage ratio was 191.66%, up 2.93 percentage points from the end of the previous year.
    • Capital adequacy ratio was 17.74%, up 0.22 percentage points from the end of the previous year.

  4. Market Recognition

    • Selected as a global systematically important bank for 13 consecutive years.
    • Won numerous awards in areas such as trade and finance, cross-border custodianship, foreign currency settlement, sales of foreign currency, inclusive finance, and ESG.

  5. Distinctive Advantages

    • Maintained the highest level in the domestic financial industry for credit ratings from the three major international credit rating agencies.

Strategies for 2024

  1. Supporting the Real Economy

    • Increased support for major strategies, key areas, and weak links.
    • Domestic RMB loans increased by CNY 2.28 trillion.
    • Loans on strategic emerging industry and manufacturing industries exceeded CNY 1.9 trillion and CNY 2.5 trillion, respectively, with significant growth rates.
    • Increased loans to private companies by CNY 790 billion, up by 27.22%.
    • Increased credit investments in agriculture-related areas, with the loan balance increasing by CNY 580 billion, up by 28.53%.
    • Supported the stable and healthy development of the real estate market by implementing policies for lowering interest rates on first-home loans and guaranteeing the delivery of buildings.

  2. Responding to National Policies

    • Continued to increase support for science and technology financing.
    • Consolidated advantages in green finance, expanding financing for key areas such as the construction of a clean energy system and the promotion of low-carbon technologies.
    • Deepened inclusive finance and enhanced the quality and efficiency of financial services for small and micro-sized enterprises.
    • Expanded the influence of the pension financial market, serving the construction of a multilevel, multi-pillar pension insurance system.

  3. Digital Finance

    • Focused on key areas such as digital infrastructure products, channels, risk control, marketing, and operations.
    • Released version 6.0 of the offshore personal mobile banking app.
    • Expanded the coverage of corporate internet banking.
    • Increased the number of monthly active customers of mobile banking to 87.76 million, a year-on-year increase of 15.17%.
    • Increased the transaction volume in mobile banking to CNY 54.88 trillion, up by 17.46% year-on-year.

  4. Globalization

    • Optimized the global business network with the successful opening of the Riyadh branch in Saudi Arabia and a representative office in Papua New Guinea.
    • Overseas institutions covered 64 countries and regions, including 44 countries along the Belt and Road.
    • Strengthened the market competitiveness of overseas institutions.
    • Continued to serve Hong Kong in consolidating and enhancing its status as an international financial center.
    • Promoted the internationalization of RMB in a prudent and solid manner.

  5. Reform and Innovation

    • Optimized the corporate governance system, revised the articles of association, and improved the rules of procedure of the Board of Directors.
    • Systematically reformed and improved the performance appraisal system.
    • Continuously promoted the construction of the group's information technology and enterprise-level architecture.
    • Steadily advanced digital transformation and operation management.
    • Created a culture of pragmatism and commitment.

  6. Comprehensive Risk Management

    • Strengthened prevention at its source and deepened the construction of a comprehensive risk management system.
    • Continuously improved the ability to safeguard production safety and network security.
    • Used the policy toolbox in accordance with the regulatory policy.
    • Took proactive measures to optimize the real estate credit structure.
    • Met the reasonable financing needs of real estate enterprises of different ownership systems.
    • Strengthened the management mechanism of operational risk.
    • Improved derivative risks.
    • Reasonably arranged local and foreign currency funds to safeguard the group's liquidity.

Looking Forward to 2024

  1. Focus on Key Areas

    • Provide financial services tailored to the features of high-tech companies and facilitate the green transition.
    • Improve the quality of inclusive finance and accelerate the work on pension finance.
    • Accelerate the transition to digitalization.

  2. Support Expansion of Expected Demand

    • Sustainably optimize financial supply and promote the steady growth of consumption and expand effective investment.
    • Facilitate the building of a modern industrial system and serve the coordinated development strategy of the country.

  3. Serve High-Level Opening-Up

    • Improve the comprehensive financial service level of one-point access and global response.
    • Facilitate the building of the Belt and Road.
    • Maintain the bank's advantage in global business.

  4. Focus on Fundamental Work

    • Strengthen the granular management of capital and optimize the liability structure.
    • Have targeted supply of credit and improve the coordinated mechanism.
    • Grow the customer base and accounts.

  5. Improve Comprehensive Risk Management System

    • Improve the quality and effectiveness of traditional risk management.
    • Prevent non-traditional risks.
    • Implement regulatory requirements in a high-quality manner to maintain financial stability.

Conclusion

  • The year 2024 is an important year for implementing the 14th Five-Year Program.

  • BOC will continue to work hard and be pioneering in committing itself to financial development with Chinese characteristics.

  • The goal is to achieve high-quality development of the bank and make greater contributions to shareholders, society, and the country.

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