Citibank (China) Co., Ltd.

Transcription

Citibank (China) Co., Ltd.
ANNUAL
REPORT
2013
CONTENTS
CHAIRMAN’S MESSAGE
01
INSTITUTIONAL CLIENTS GROUP
02
GLOBAL CONSUMER BANKING
08
UPHOLDING WORLD-CLASS CORPORATE GOVERNANCE
10
GIVING BACK TO THE LOCAL COMMUNITY
14
AWARDS AND RECOGNITION
20
CITI’S MISSION & KEY PRINCIPLES
21
BRANCH NETWORK
23
CHAIRMAN’S
MESSAGE
I’m pleased to present to you the Citibank (China)
Co., Ltd. 2013 Annual Report. Citi China ended the
year with notable achievements which reinforced
our leadership in China’s financial industry.
China is one of the most important markets for Citi
globally, and we place great emphasis on long-term
planning for our sustainable development in this
market. Our continued investments aim to enable
progress for our clients by leveraging our global
network synergies and capitalizing on three
long-term trends – globalization, urbanization, and
digitization.
As a result, we delivered solid financial performance and ended 2013 with strong numbers. We
During the year, we expanded our target markets,
achieved an operating income of RMB4.35 billion
pursued new business opportunities, and grew our
and a net profit of RMB964 million. Our prudent
employee and client bases. We also strengthened
approach in operations and continued focus on
our product innovation and extended our network
high quality customers allowed us to attain strong
presence in line with the latest development of the
healthy ratios, like our Capital Adequacy Ratio,
local banking industry.
which was at 14.22 percent and well above the
regulatory requirement.
Our Global Consumer Bank upheld its long-standing reputation in wealth management, substantiat-
We are optimistic about the future of China. As we
ed by our ability as the first foreign bank to launch
move the business forward, we will continue to
domestic mutual funds in China. We continued to
actively participate in and contribute to China’s
push ahead with our credit card business, for which
financial reform for the development and prosperi-
we were the first global bank to issue sole-branded
ty of the local banking and financial sector. I
credit cards, offering attractive products and
believe that, with this right attitude, strategy and
unique value propositions to our card holders.
vision for success, Citi China will continue bringing
more opportunities to our clients and China.
We were also actively engaged in China’s financial
reform, and were honored to be the pioneer global
bank to obtain approval to prepare for a
sub-branch in the China (Shanghai) Pilot Free
Sincerely,
Trade Zone. By amalgamating the latest policies in
the Zone with our unparalleled global expertise,
local insight and client relationships, we launched
industry-first solutions that helped our clients
Andrew Au
maximize opportunities there.
Chairman, Citibank (China) Co., Ltd.
01
CCCL has also been elected as the Co-Chair of the
key cities around the globe continue to serve them.
Shanghai Banking Association (SBA) FTZ committee.
We hosted ‘China Day’ in multiple cities around the
world, sharing with clients insights and updates on
As part of the ongoing reform in the FTZ, Citi China
their concerned industries and the related econo-
launched RMB cross-border auto pooling and
mies. We also organized China Desk Network Day
payment netting solutions in line with newly
in April and December, where we gathered staff
released FTZ policies. We are the first bank to do
from all our China Desks to meet with Chinese
so, thanks to our unparalleled global network,
customers and give them a platform to network
strong product capabilities and in-market knowl-
with each other.
edge in customizing existing solutions according to
client needs.
INSTITUTIONAL
CLIENTS GROUP
Citi’s Institutional Clients Group builds enduring relationships with clients by providing a full suite of strategic advisory and financing products to multinational and local
corporations, financial and public sector institutions, and privately held businesses.
Sub-branch in the Shanghai
Pilot Free Trade Zone
As a leader in the local financial industry, Citi has
also given more than 15 talks at internal and external events, webinars and seminars to relevant
global customers, which educated the audience
about new regulations, opportunities for them in
the Zone and our corresponding services created
for their benefit.
Corporate and Investment
Banking
Global Subsidiaries Group
Citi has traditionally been a leading financial
service provider to multinational companies operating in China.
In 2013, our Global Subsidiaries Group (GSG)
continued to capitalize on Citi’s global network and
broad service offerings to support our client’s
growth in China. The department witnessed good
business momentum in 2013 as clients continued
to invest and build capacity for the future. We
Citi’s Corporate and Investment Banking arm provides comprehensive relationship coverage service to ensure the
best possible service and responsiveness to our clients.
focused on holistic client advisory that is combined
with strong execution, and helped our clients raise
significant funds from the capital markets, including several innovative structures in cross border
financing flows.
In 2013, Citi China continued to help our clients
A key milestone for Citi China in 2013 was the approval in September 2013 to open a sub-branch in the China
develop and expand domestically and overseas.
(Shanghai) Pilot Free Trade Zone (FTZ). The FTZ is a big step taken by the Chinese government in its reform
Some of these clients have now expanded across
journey. It is an honor to be the first global bank to receive this approval.
five continents, and our nine China Desks based in
02
03
Financial Institutions Group
and Public Sector Group
Citi China bagged five titles in Asia Pacific finance
magazine Asian Money’s 2013 Foreign Ex-change
(FX) survey:
Driven by the special needs of institutional clients,
Best Overall FX Services (Corporate category);
the Financial Institutions Group (FIG) and Public
Sector Group (PSG) provide comprehensive finan-
Best FX Options (Corporate category);
cial solutions to a wide range of financial institutions and the public sector, including banks, insur-
Best FX Products and Services (Corporate cate-
ance companies, securities firms, fund managers,
gory);
trust and leasing companies, and public sector
firms.
Best FX Research and Market Coverage (Corpo-
FIG & PSG achieved robust business development
Markets
in 2013. We continued to lead the industry with the
strongest presence of any international bank in the
local
market,
offering
a
full
spectrum
of
tailor-made solutions with a deep understanding of
the financial institutions industry in China. We also
have one of the largest professional financial institutions team among foreign banks in China.
Top three Best FX Services (Financial Institu-
With one of the largest Markets teams
among international banks, Citi offers a
broad range of market-leading and
innovative financial products to corporate, institutional, government and
public sector clients.
tions category).
We were also recognized as the industry’s best in
client servicing by Euromoney magazine and
research-based consulting firm Greenwich Associates (top three).
The FIG also facilitated the implementation of new
rules from two regulatory bodies:
rate category);
In order to better provide customers with solutions
according to their unique needs, Citi China also
The China Insurance Regulatory Commission
partnered with other banks and financial institu-
(CIRC) released its first rulebook for interim
tions including mutual fund, insurance, pension and
measures for overseas investment of insur-
sovereign fund companies, to leverage on each
ance funds. As Citi China works with several
other’s strengths and innovation.
insurance companies, FIG took responsibility in
proactively assisting our partner insurance
In 2013, Citi Markets sustained strong performance
agencies in planning for future business
and maintained its leadership position in foreign
according to the rules.
exchange, interest rates and commodities.
The China Banking Regulatory Commission
As many Chinese companies showed a large inter-
(CBRC) put in place new capital management
est in going global during the year, the Markets
regulations for banks for the first time. To this
team was focused on enabling them to do so. In
end, Citi China FIG shared with other banks
addition to traditional banking services, we helped
about our company’s global experience to help
them set up global risk management platforms,
everyone get up to speed.
manage foreign exchange exposures, conduct
structured finances, and execute hedging transactions onshore and off-shore.
04
05
Securities and Fund Services
All of these products and services aim to improve
treasury efficiency for our clients. For Chinese
multinational corporations, TTS dedicated atten-
Securities and Fund Services (SFS) offers a large
tion to providing them even greater financial
portfolio of products and services including custo-
support for their global business expansion.
dy, escrow and related services, depositary
receipts, and agency and trust.
We also support international securities trading
and investment activities of leading institutions
through efficient receipt, delivery and safekeeping
of securities as well as the related cash and FX
functions.
Treasury and Trade Solutions
Business highlights include:
All these services are offered to a wide range of
sophisticated investors, including mutual funds,
pension funds, hedge funds, banks, and insurers.
Global industry surveys consistently rank us as a
premier choice for custody, clearing, agency and
trust, and depositary receipts services in more
markets than any other bank.
Treasury and Trade Solutions (TTS) delivers cash
Executing the first RMB cross-border lending
management and trade solutions that help clients
transaction in January 2013 and maintaining
streamline and automate processes, mitigate risk
leadership in the number of these transactions;
and expand their reach.
Launching a series of RMB cross-border trade
In 2013, the TTS team continued to lead the way in
refinancing
delivering innovative and customized solutions to
optimized trade financing for their cross border
clients, including an array of digital and mobile-en-
RMB trade flows;
solutions
that
give
clients
abled platforms and tools. Of note were a couple of
new product launches in cash delivery and trade
and treasury management that are first in the
industry. These new solutions are focused on
promoting RMB internationalization, created in
line with our approval as the first global bank to
open a sub-branch in the China (Shanghai) Pilot
Free Trade Zone (FTZ).
Providing
successfully
foreign
currency
cross-border centralized fund management
solutions for multinational corporations under
State Administration of Foreign Exchange’s
(SAFE) pilot program;
Being the first international bank to launch a
paperless
processing
solution
for
RMB
cross-border settlements;
Performing the first cross border RMB sweeping transaction in the market.
06
07
GLOBAL CONSUMER
BANKING
Commercial Bank
Citi is focused on being a trusted financial advisor of
each and every of our small and medium private enterprises (SMEs) customer.
In 2013, our commercial banking business attained
Citi’s Global Consumer Bank (GCB) focuses on serving affluent and emerging affluent customer segments in top-tier cities,
where the bank’s unique global network,
premium brand, customer-centric products and services provide unique competitive advantages. GCB aims to deliver a
remarkable experience through industry-leading products and services,
next-generation retail formats and
world-class digital channels.
market average. Retail sales were three times
strong growth among key indicators in revenue,
above average; activation rate was twice that of
customer deposits.
average.
As a testament to delivering remarkable customer
experience, Citi launched a 60-minute card
issuance service in 2013 where customers could
get their applications approved and personalized
cards issued within an hour.
Citi became the first foreign bank to be allowed by
the China Securities Regulatory Commission
(CSRC) to sell domestic mutual funds in the country
in June 2013. A new addition to the bank’s existing
portfolio of wealth management services, Citi
Wealth Management Products
In 2013, GCB celebrated a number of milestones in the
credit card and wealth management businesses,
Citi China is deeply committed to bringing choices,
including instant card issuance and the launch of local
innovation and world-class wealth management
mutual fund. Our retail network also expanded with a
products and services to our customers.
China’s domestic mutual fund products combines
our experience in global mutual funds with our local
market knowledge.
By the end of 2013, Citi China was partnering with
five fund houses to offer over 20 domestic mutual
new outlet in Chengdu, bringing our total number of
retail outlets in the country to 52.
Domestic Mutual Funds
Besides offering customers a comprehensive array
funds.
We tap our global expertise and resource network to
bring new, innovative and value-added solutions that
better cater to our expanding customer base and
enhance our relationships with them. For example, our
mobile banking application allows customers to access
banking services, like payment authorization, efficiently, conveniently, and most importantly, safely.
Citi offers a broad range of solutions to our SME
customers, such as our American Depositary Receipts
(ADR), syndicated loans, bonds, international funds
and cross-border RMB settlement pooling services,
grant SMEs the capability to expand their business
abroad, thereby increasing their competitiveness. In
2013, Citi Commercial Bank partnered with our China
of products, we are also devoted to creating more
Export and Credit Insurance Corporation (SINOSURE)
Credit Cards
convenient and smarter service channels.
to support a number of SMEs in export insurance and
Citi China offers two credit cards: Premier Miles
mutual funds transactions into CitiPhone Banking,
and
consumer
through which customers can buy, sell, redeem,
The Citibank China Emerging Affluent Tracker
It is important that our SME customers are kept
segments according to their spending preferences,
and transfer QDII mutual funds remotely, thereby
Report, conducted semi-annually by research com-
apprised of market movements so that they can plan
and are available in all 13 cities that Citi China oper-
increasing efficiency notably.
pany Anovation, evaluates a set of markets and
better and more sustainable business strategies. We
trends KPIs to calculate Citi China’s brand consid-
do this through different activities and communica-
eration scores as a measure of the level of public
tions, like trainings, seminars, and networking events
awareness of our brand.
organized in collaboration with the Economic Informa-
Rewards,
targeting
For
example, in April 2013, we incorporated QDII
different
ates in.
The PremierMiles Card boasts the widest range of
Building Brand Awareness
financing.
tion Commission, various SME associations, law firms,
redemption choices for over 50 airlines and access
to over 600 airport lounges worldwide six times
In 2013, Citi China continued and expanded our
auditing companies, etc. These events also encourage
per year, and gives cardholders the flexibility of
‘Blue Wave’ branding campaign to five major cities,
a spirit of information sharing among SMEs and the
transferring air miles to friends and family;
namely, Beijing, Chongqing, Guangzhou, Shanghai
aforementioned third parties in the country.
Rewards Card holders enjoy preferential offers
and Shenzhen. We paid extra attention on deliver-
with Citi’s merchant partners, and can use points
ing value-added communications like sending
In 2013, we held over 50 of these sessions that
accumulated to redeem air miles or vouchers.
relevant and useful information to target audienc-
spanned more than 200 hours across 15 cities in China,
es. As a result, our brand consideration score more
and received a ‘SMEs’ Favorite Service Provider’
than doubled from that of 2012.
award from Guangdong Provincial SME Development
2013 September 19th marked the first year anniversary of our sole-branded credit cards. Results have
Association.
exceeded expectation and outperformed the
08
GLOBAL CONSUMER BANKING
09
UPHOLDING WORLD-CLASS
CORPORATE GOVERNANCE
Board members can timely be aware of the opera-
independent directors have actively participated in
tion and management situation of the Bank and
the decisions of the Board and provided their inde-
provide responses to management through such
pendent opinions.
communication mechanism. All the directors
performed their duties with due diligence and
At Citi, we aspire to the highest standards of corporate governance and ethical conduct. We act in the best interests of all of our stakeholders, maintain the highest ethical standards, and ensure full compliance with the laws and regulations that govern
our company.
protected the interests of both the Bank and the
CCCL does not have a board of supervisors, but
Independent Directors
has a single supervisor designated by the share-
As of the end of December 2013, we have two inde-
Board of Directors
pendent directors, i.e., Mr. Stephen Long (who
replaced Mr. Danny Liu to be our new independent
The structure of the Board of Directors has been optimized since the establishment of Citibank China Co., Ltd
director since June 2013) and Mr. Zhe Sun.
holder. Our supervisor Mr. Mark Hart performed
his duties diligently and attended all of the Board
meetings after his appointment, and issued confirmation letters to the meetings he attended accordingly.
(CCCL). As of 31 December 2013, the CCCL Board of Directors consisted of 10 directors in total, 5 non-executive directors, 3 executive directors and 2 independent directors.
Supervisor
shareholder.
Mr. Stephen Long is the voting member of Internal
Audit Committee and Risk Management Committee
under the CCCL Board, and also chairs the Internal
Title
Name
CCCL Title
Audit Committee.
Chairman
Andrew Au
Legal Representative,
President
Mr. Zhe Sun is the voting member of Risk Manage-
In addition, Mr. Hart supervised the Bank’s financials and the performance of directors and the
senior management. The supervisor also provided
opinions to the matters in relation to 2012 audited
ment Committee and Related Party Transaction
Independent
Director
Stephen Long
Independent
Director
Zhe Sun
Director
Kai Zhang
CFO
and the relevant committee meetings (Mr. Stephen
Director
Simon Chow
EVP
Long attended all Board and relevant committee
Director
Stephen Bird
Director
Deepak Sharma
Director
Daisy Yao
Director
Agnes Liew
In addition, during the intersession of the Board
Director
Anthony Nappi
meetings, the independent directors kept abreast
Control Committee, and he is also the chairman of
Related Party Transaction Control Committee.
financials, the performance of directors and the
senior management. We also informed the supervisor about related party transactions under the
15th board written resolution.
Both of them have attended all the Board meetings
meetings
after
his
appointment),
and
were
involved in the consideration and approval of the
related matters.
themselves with our monthly financial information,
business updates, and CBRC on-site inspections
through our newsletters.
In 2013, we held 4 Board meetings at an average of once every quarter. The Board resolved or heard the
Professional Board
Committees
reports of a total of 57 matters (including 26 resolutions and 31 reports). In addition, CCCL Board has exer-
Furthermore, Mr. Zhe Sun has issued his written
As of December 31, 2013, there were three profes-
cised 6 written resolutions to 6 key matters in the period between Board meetings.
opinion on material related party transactions
sional committees under the CCCL Board. These
reviewed through the 15th written resolution of the
were: a Related Party Transaction Control Com-
During the intersession of the board meetings, we also provided 14 newsletters to the Board in terms of
Board (for completion of information purpose, Mr.
mittee established on June 13, 2007, an Internal
CCCL’s monthly financial information, CBRC on-site inspection on CCCL’s consumer banking business and
Danny Liu also issued a written opinion on the
Audit Committee established on June 13, 2007 and
commercial banking business, CCCL’s self-assessment on counter operation and financial/expense control,
same material related party transactions). The
a Risk Management Committee established on
and Notice on Foreign Banks’ Risk Prevention and Stable Development for 2013 issued by CBRC Shanghai.
10
11
September 12, 2007. Details are as below:
review and discuss the matters correctly and
mittee made 11 resolutions and heard 41 reports. The
management (IBAM); reopen rate (RoR); and on time
efficiently.
risk portfolio seasonal report, classified portfolios,
remediation rate (OTR).
NPLs and loss provisions, and key risk limits against
Internal Audit Committee
Senior Management Team
Chairman
The senior management team of the Bank performed
Committee Voting Member
Committee Non-Voting Member
Stephen Long
Independent Director
Daisy Yao
Andrew Au
Simon Nie
Related Party Transaction
Control Committee
Chairman
Zhe Sun
Andrew Au
Deepak Sharma
Agnes Liew
Lili Qin
Kai Zhang
Risk Management Committee
Chairman
Daisy Yao
Stephen Long
Zhe Sun
Anthony Nappi
Andrew Au
Lili Qin
William To
Wai-ling Wong
Marine Mao
an active role in adherence to optimizing the corporate governance standard, expanding the Bank’s
scope and promoting the Bank’s reputation.
The
team provided timely reports to the Board and/or the
Board committee through various channels, including
Board and committee meetings, newsletters, etc.
Management level committees also held several
meetings and actively exercised its management
functions.
training was provided to employees. These topics
included anti-fraud policies and fraud awareness,
professional conduct, improper electronic communianti-money
At
meeting.
expressed their opinions and provided constructive
laundering
and
sanctions,
anti-bribery and corruption, etc. The senior management team met regularly and worked diligently to
ensure the Bank performed well in 2013.
In addition to these achievements, we will continue to
adhere to, and where appropriate, strengthen our
governance practice to ensure stable, sustainable and
fast development in 2014.
country risk policies. They continued to focus on the
frequent communications facilitate mutual under-
key risk areas that CCCL faced due to regulatory
standing between them and CCCL, and therefore,
requirements and market changes, including reputa-
help our internal audit team address their expecta-
tion risk, information technology risk, fraud case
tions and concerns more effectively.
prevention and outsourcing risk, etc.
Internal Audit adopted a risk-based methodology,
managed within the organization’s risk tolerance.
Audit plan is driven by audit needs assessment of
auditable entities. The audit needs assessment is
based on a composite risk which is derived from two
distinctive ratings – Citigroup level risk rating and
ensuring transparency and procedural fairness of transactions undertake with the Bank’s related parties.
The Committee takes responsibility of identifying the
related parties of CCCL and ensures that the latter’s
information is accurate. They monitor transactions in
Internal Audit received the latest business and
General related party transactions are reviewed and
management information through business monitoring and shared audit results, key findings and status
of corrective actions through various committee such
as the Business Risk and Compliance Control Committee etc. More importantly, it also draws management
attention to significant risks and internal control
abreast of supervising senior management’s control
and 6 local offices in 2013, so as to keep abreast with
decisions. The three special committees held 12
of various risks, including credit, market, liquidity,
the changing regulatory requirements and facilitate
meetings in total, reviewed 27 motions and heard
compliance, operational , IT and, reputation risk. It
communication with local regulators.
45 reports. Each of the three committees effective-
also reviews risk portfolio reports, classified portfoli-
ly operated with distinct division of responsibilities
os, NPLs and loss provisions and key risk limits
Topics discussed during these meetings include regu-
and provided professional advice and suggestions
against actual exposures.
latory expectations, internal audit transformation,
12
defines the principles, procedures and rules aimed at
credit extension, asset transfer and service provision.
roles in assisting the Board to make correct
ground for the Board so that the Board could
The Related Party Transaction Control Committee
country level risk rating.
Head of Audit paid several visits to CBRC Shanghai
They provided solid
fully
in making scientific and effective decisions.These
The Risk Management Committee keeps itself
party transaction control.
members
portfolio, derivative risk assessment, stress test and
ing quality and effectiveness, performed important
in terms of audit, risk management and related
meeting,
members played an active role to support the Board
lapses.
Board, based on the principle of equally emphasiz-
committee
The Committee paid attention to the credit card
Robust Risk Management
and Internal Control
In 2013, the three special committees under the
each
and timely suggestions to the management team. All
which provides assurance that risks are being
Our management team also ensured that adequate
cation,
actual exposures were reviewed at each Committee
approved by the Committee, while the material related
party transactions are subject to approval by the
Committee to ensure all of CCCL’s related party transactions are made in good faith, are according to the
arms-length principle, and are compliant with the
relevant laws and regulations.
In addition, material related party transactions are, post
The Citigroup Chief Auditor, Regional Chief Auditor,
CCCL’s Chair of the Audit Committee and Country
audit focus and the three key performance indices
All voting members of the Committee attended every
(KPIs) directly linked to the management’s perfor-
of the four meetings held during the year. The Com-
mance. The KPIs are: issues being addressed by
the examination of the Committee, submitted to the
Board of Directors for final approval. By having a formal
approval and review process, it allows CCCL to achieve
in-country governance and enhance effectiveness of
controls.
The Committee is legislated by the China Banking Regulatory Commission’s administrative measures for
connected transactions between commercial banks and
their insider or shareholders, the Related Party Transaction Internal Control Policy and the Working Rules for the
Related Party Transaction Internal Control Committee of
CCCL.
13
GIVING BACK
TO THE COMMUNITY
.
As Citi grows in China, we are committed
to good corporate citizenship at every
opportunity. We take a holistic approach
in giving back to our local communities
around China in a manner that is
results-oriented and that contributes to
the sustainable development of the
communities we support.
Citi strives to put part of our money, talent, experience where we can help accelerate economic
opportunity, and to find ways to include more
Financial Capability and Asset
Building
Citi sees financial knowledge and skill
sets as an important life skill. This, coupled with our expertise in this space,
made us decide to support an extensive
array of financial education programs
that have to date benefitted 13,000 children and youth in 2013 alone.
Enterprise Development
and those where philanthropic capital can seed the
development and testing of new ideas with the
potential to attain scale.
Our efforts are partially catalyzed by Citi Foundation’s investments in partners that promote financial inclusion and economic empowerment, and
fueled by the engagement of our employees and
partners. The Foundation provides support to
programs that promote the scaling of proven ideas.
We also encourage employees to participate
actively in activities that complement our commu-
We and our NGO partners are heartened by the
changes we have witnessed in their financial
behaviors,
like
developing
personal
non-profit partners to launch twelve community
14
The program illustrates basic financial concepts
a platform for them to network and learn, the
such as financial planning, smart spending and
Awards are highly regarded as an industry yard-
saving, in interesting and easy-to-absorb ways:
stick for success. In fact, this year’s Awards com-
cartoons, comic books, skits performed by the
mittee received the highest number of applications
students themselves and competitions, and in and
to date, with 165 applications for Institutional
out-of-school activities. Of note, the cartoon series
Awards from 23 provinces, and an overwhelming
was a new channel introduced in December 2013,
100 individuals competing for the Microentrepre-
consisting of 32 episodes, nine of which were
neur of the Year Award.
dubbed in local dialects by Citi volunteers.
Microfinance
The Citi
– CBA Micro-entrepreneurship Awards
budget and maintaining monthly expenditure
Citi celebrates microentrepreneurs and microfi-
report.
nance practitioners with the annual Citi Microentrepreneurship Awards (CMA). The Awards has a
secondary mission to raise awareness of the role
Case Study:
Agent Penny Program
development programs that address a diverse
group of social, economic or environmental needs.
become the largest and most influential event for
monthly
nity activities.
In 2013, Citi China joined hands with more than ten
ods.
As a leading corporate supporter of
microfinance in China, Citi has, over
the decade, been advocating for the
sector’s development by enlarging the
capacity of non-profit microfinance
institutions (NGO MFIs) and sector
networks to support financial education initiatives for microfinance
clients, many of whom are a less fortunate population.
causes that fit our mission of financial inclusion
ground and thought leadership and innovation
Funded by Citi Foundation, the Awards have since
Chinese microfinance practitioners. Besides being
people in the financial system. We support specific
nongovernmental organizations working on the
primary school students through innovative meth-
of microfinance in increasing access to finance
and poverty alleviation.
In October 2013, we held the ninth CMA in Beijing
The Agent Penny program was launched in 2007
where we gathered 200 microfinance practition-
and expanded in 2009 with NGO Shanghai Better
ers, veterans and supporters from government,
Education Development Center (Better Education)
non-profit
in a bid to promote financial literacy to upper
research institutions and media.
organizations,
banks,
industry
GIVING BACK TO THE COMMUNITY
15
Financial Stability and
Enterprise Development
In 2011, Citi China partnered with the Communi-
artisans also got a chance to showcase their
ty-Based Conservation and Development Research
talents and products.
Citi focuses on initiatives that address
key community needs – financial stability, enterprise development and neighborhood revitalization – while fostering
innovation and providing thought leadership.
to derive greater impact for the farmers.
Center of Guizhou (CCDRC) to launch the Guizhou
In August 2013, Citi and HPP announced the com-
Indigenous Batik Development Program. The
pletion of the project. The achievements are
program has since expanded to more craftworks in
impressive:
the province, which explains the program’s more
encompassing name today.
70 percent of program household enterprises
The program sought to enhance the artisans’
have indicated an increase in their average
production and marketing skills so that they can
annual income by 30 percent.
make a better living. We also established sales
We also collaborate with external stakeholders to
centers where the artisans are able to negotiate
1,853 household enterprises (7,096 individuals)
address these economic issues through impactful,
prices, expand their sales channels i.e. new
from five villages in the district received the
multiyear public-private partnerships that include
markets.
technical and field trainings.
Overall success would call upon strong collabora-
A total of 127 training sessions have been
In China, we pay particular attention to disas-
tion not only between Citi and CCDRC, but also
conducted for 19,561 farmers cumulatively.
ter-stricken and poor villages. We desire to create
from other corporations, grass-root organizations
effective and sustainable vehicles to help the com-
and the local government.
nonprofit partners and local governments.
munities to reap triple benefits – economic, environmental and social. We do so by building their
living quarters, increasing their income levels by
way of establishing or expanding household and
micro enterprises, coaching them on adopting
better and greener farming practices and technology, and expanding their market access, while
preserving their indigenous traditional cultural
heritage like art and agriculture.
The results to date speak for themselves:
Over 2,000 household enterprises (7,000
individuals) have witnessed their income levels
increase by 30-40 percent year-over-year.
Case Study:
Chongqing Rural Small
Development Program
Citi donated fruit and nut trees to 120 house-
Enterprise
estimated additional annual profit of at least
RMB 920,000 for 20 years when trees are in
Chongqing is Guizhou’s neighboring province, in
southwest China. Most of its population are farmers as agriculture remains significant.
The program has received wild acclaim, winning
full production.
Community development funds were established to support 62 income generating
sub-projects, bringing additional 10 percent of
several of the nation's top community develop-
Since late 2010, Citi has been partnering with a
ment awards.
humanitarian organization Humana People to
People (HPP) to economically empower impover-
Citi also recognizes that solutions to many com-
The sustainable success and impact of the
plex community challenges require sustained
ished and low income residents of rural Chongqing
program has drawn attention not only from
investment and collaboration over time. Here are
in a sustainable way.
within the Guizhou Province, but also from its
some examples of how our long-term commit-
neighbors, renowned experts, designers and the
ments have made a real difference:
The program was first incepted in Wanzhou district,
industry’s influencers.
teaching the farmers from small and growing
Case Study:
Guizhou Indigenous Craftwork
Development Program
hold enterprises to further generate an
income increase to 847 participating families.
With this resounding success, Citi and HPP will
replicate the program in Haokou, Wulong district
come January 2014.
household enterprises technical and practical skills
In November 2013, we celebrated the program’s
like sustainable agricultural production, animal
third anniversary with an event with our partners,
husbandry, rudimentary finance and marketing. We
during which we shared with attendees our
also built an effective and sustainable training
Guizhou, a rural province located in southwest
program model, learnings, experiences and the
model for local farmers to become skilled farming
China, is tknown for its indigenous artisans, mostly
sustainable impact generated. We also supported
instructors, and established farmers’ clubs that
from the Miao minority group.
the launch of the Guizhou Absolute Cultural Week
conduct systematic training and support activities
and 2013 Absolute Guizhou exhibition, where the
16
17
Youth Education
and Livelihood
Youth ages 13–25 represent a growing percentage
mation, knowledge and experience about the
of the Chinese population.
finance industry, so that they will be better
prepared for the real world upon graduation
Our grants, funded by Citi Foundation,
support programs that aim to increase
the number of low-income, migrant,
youth who, based on their skills, become
employed, start their own income-generating business or obtain higher education or training.
In 2013, Citi China renewed our commitment for
the third year, to the BN Vocational School (BNVS)
and Safe the Children to provide complimentary
training to migrant students who hope to gain
academic knowledge (English, Chinese, Math),
vocational (electrical maintenance, western pastry
later that year.
Continued hosting Banking Courses in Beijing
University and Fudan University over ten weeks
each. The universities have expressed gratitude
to Citi China for hosting the courses and shared
positive feedback from the students. As of 2013,
Beijing University has also made the Citi Banking Course as a compulsory subject for all
Finance majors.
In 2013, Citi China continued to sponsor five
scholarships in various educational institutions
and competitions.
and hospitality services) and life skills (professional etiquette, Chinese traditional culture, communications, self-confidence or conflict management)
to secure skilled-based employment and the opportunity to break their families’ poverty cycle.
Citi Forum
2013 was the 10th year that Citi sponsored the Sun
Yat-sen University Management School’s Citi
Young Talent Development
Forum which saw the largest number of partici-
Citi believes in nurturing the next generation of
and scholars from local top universities with its
talent who will be the main contributors to our
unique form and original content.
economy.
pants ever. Citi Forum attracts numerous students
Industry
Recognition
Universum’s Student’s Ideal Employer Survey
which ranked Citi 4th among business students,
with our brand, training and development
opportunities, and harmonious teamwork being
We continue to cooperate with top universities to
Citi China’s efforts in this area have been recog-
sponsor, train, and recognize young talent through
nized by third parties, including:
various programs. In 2013, we:
the top reasons.
ChinaHR’s 11th Best Employers of China placed
us at the top among foreign banks, second in
Continued our Management Associate (MA)
the investment banking and securities industry,
Summer Internship program – the Citi Future
and 14th in the overall ranking, a stark improve-
Elite Summer Camp – with structured orienta-
ment from the previous year’s rank at 40.
tion, soft skill trainings, speaker series, and an
offsite camp to equip students with more infor-
18
19
AWARDS AND
RECOGNITION
ChinaHR
The Asset
Best Bank in China (for the 7th year)
11th Best Employers of China Awards’ 14
Best Employer in China
th
China Business Journal
Citizenship Awards
Most Competitive Foreign Bank
JRJ.com and Tsinghua PBCSF,
Tsinghua University
China Business News (CBN)
2013 Lujiazui Warm-hearted Finance
Best Foreign Bank
China Philanthropy Times
2013 CSR Awards
The Corporate Treasurer
Outstanding Program Award
Best Cash Management Bank
Global Finance
China Foundation for Poverty Alleviation
World’s Best Consumer Internet Bank
Best Foreign Consumer Credit Card
Best Foreign Equity Underwriting
2013 Collection of China and Foreign
Enterprises' Outstanding International
CSR Cases
2013 Poverty Alleviation Ambassador
China Charity Festival
Greenwich Associates
Asian Large Corporate Banking Quality
Asian Large Corporate Cash Management Quality
Shanghai Banking Association
Best Banking Customer Service Center
Best Innovation in Charity Award
Best Charitable Program Award
Shanghai Pudong Charity United
Pudong Charity Award
Shanghai Oasis Ecological Conservation
and Communication Center
Annual Financial Statistical Evaluation
People’s Bank of China
2013 Best Green Angel Award
Universum
Student’s Ideal Employer Survey’s 4th Most
Ideal Employer
20
CITI’S MISSION &
KEY PRINCIPLES
Common
Purpose
Responsible
Finance
Citi’s Mission: Enabling Progress
Citi works tirelessly to serve individuals, communities, institutions and
nations. With more than 200 years of experience meeting the world’s toughest challenges and seizing its greatest opportunities, we strive to create the
best outcomes for our clients and customers with financial solutions that are
simple, creative and responsible. An institution connecting over 1,000 cities,
160 countries and millions of people, we are your global bank; we are Citi.
key principles
that guide us
as we perform
our mission are:
Ingenuity
Leadership
21
One team, with one goal: serving
our clients and stakeholders
Conduct that is transparent,
prudent and dependable
Enhancing our clients’ lives through
innovation that harnesses the breadth
and depth of our information, global
network and world-class products
Talented people with the best
training who thrive in a diverse
meritocracy that demands
excellence, initiative and courage
CITI’S MISSION & KEY PRINCIPLES
22
BRANCH NETWORK
-BRANCHES
01 BEIJING
02 CHANGSHA
2F, No.110, Furong Middle Road, 2nd Section, Changsha, P.R.China 410015
Tel: (86731)89860518 Fax: (86731)89860488
03 CHENGDU
Unit A-E, 30/F, City Tower,No.86 Section 1 Renminnan Road Sichuan,
P.R.China 610016
Tel: (8628) 86110066 Fax: (8622) 86202160
04 CHONGQING
GroundUnit 1~3, 12, 18F, No 38, Qingnian Rd, International Trade Center,
Yuzhong district, Chongqing, P.R.China 400010
Tel: (8623) 63106395 Fax: (8623) 63106312
05 DALIAN
Unit 12, 01-03, 18F, Wanda Center, No 6, Gangxing Road, Zhongshan District,
Dalian, P.R.China 116001
Tel: (86411) 39763976 Fax: (86411) 39027599
06 GUANGZHOU
07 GUIYANG
23
16-18F, Excel Center, No.6 Wu Ding Hou Street, Xi Cheng District,
Beijing, P.R.China 100032
Tel: (8610) 59376000 Fax: (8610) 59376002
7201-7202, Office Tower, CITIC Plaza, No.233 Tian He North Road,
Guangzhou, P.R.China 510613
Tel: (86755) 82371888 Fax: (86755) 25988829
Unit 1-01, No 215, Fushui South Road, Nanming District, Guiyang,
P.R.China 550002
Tel:(86851)5285888 Fax:(86851)5258009
08 HANGZHOU
13 Floor Unit A, B, G, Jia De Plaza, No. 118 Qing Chun Road,
Hangzhou, P.R. China 310003
Tel: (86571) 87229088 Fax: (86571) 87222827
09 NANJING
1F-2F, Nanjing World Trade Center, No. 2 Hanzhong Road, Nanjing,
P.R.China 210005
Tel:(8625)88011088 Fax:(8625)89602700
10 SHANGHAI
No.33 Hua Yuan Shi Qiao Road, Lu Jia Zui Finance and Trade Area,
Shanghai, P.R.China 200120
Tel: (8621) 28966000
11 SHENZHEN
34F, Duty Free Building, No. 6 1st Fu Hua Road, Fu Tian CBD,
Shenzhen, P.R.China 518048
Tel: (86755) 82371888 Fax: (86755) 25988829
12 TIANJIN
Room 1801, 18/F, The Exchange Tower, No.189 Nanjing Road, Heping Destrict,
Tianjin, P.R.China 300051
Tel: (8622) 58900988 Fax: (8622) 83191688
13 WUXI
1F, 2F, & unit 0701-0703, 0712, 0715-0722, 7F, No.218, Jin Jiang Hotel,
Zhongshan Road,Wuxi, P.R.China 214002
Tel: (86592) 2133751, 2029832, 2023333 ext. 208 Fax: (86592) 2133752
14 XIAMEN
Room 208, Holiday Inn Crown Plaza, No. 12-8 Zhenhai Road,
Xiamen, P.R.China 361001
Tel: (8622) 58900988 Fax: (8622) 83191688
BRANCH NETWORK - BRANCHES
24
BRANCH NETWORK
-CONSUMER OUTLETS
01 SHANGHAI
Shanghai Branch
1/F Citigroup Tower, No.33 Hua Yuan Shi Qiao Road, Lu Jia Zui Finance and
Trade Area, Shanghai, P.R.China 200120
Tel: 8621) 28963333 Fax: (8621) 28963590
Shanghai Yalong Plaza Sub-branch
Unit S01, 1F and Unit S13, B2, No.500, East Jinling Road,
Tel: (8621) 38627333 Fax: (8621) 63732685
Shanghai Lujiazui Sub-branch
1/F, Marine Tower, No.1 PuDong Avenue,
Tel: (8621) 38627188 Fax: (8621) 68860028
Shanghai Xin Tian Di Sub-branch
Unit F, Building 1-6, No 222, Madang Road, Luwan District,
Tel: (8621) 38627588 Fax: (8621) 53068396
Shanghai Puxi Sub-branch
1/F, North Building, Peace Hotel, No.19 Zhong Shan Dong Yi Road,
Tel: (8621) 38627000 Fax: (8621) 63297676
Shanghai People Square Metro Station Sub-branch
Unit 1-116, Interchange Hall, People Square Station,
Shanghai Metro Line 1 Shanghai, P.R.China 200021
Tel: (8621) 38627600 Fax: (8621) 22057282
Shanghai Gu Bei Sub-branch
1F Unit 102, Golden Garden, No.1078, Gubei Road,
Tel: (8621) 38627488 Fax: (8621) 62709509
Shanghai West Yan An Road Sub-branch
Unit 01, 02, 7F, unit 01 02, 2F and unit 01,
1F, No 500, West Yan An Road, Shanghai, P.R.China 200050
Tel: (8621) 38627388 Fax: (8621) 32200960
Shanghai Xujiahui Sub-branch
No 955-5, Zhao jia Bang Road,
Shanghai, P.R. China 200030
Tel: (8621)38627511 Fax: (8621)54246182
Shanghai West Nanjing Road Sub-branch
Unit A, 1F and 2F, No 762, West Nanjing Road,
Tel: (8621) 28963188
Fax: (8621) 68860028
Shanghai Zhongshan Park Sub-branch
Unit 1055, Ground Floor, Cloud 9 Mall, No.1018 Chang Ning Road,
Shanghai, P.R. China 200042
Tel: (8621) 38627222 Fax: (8621) 62121520
Beijing Branch
Room 101, 1st Floor, Excel Centre, No.6 Wu Ding Hou Street, Xi Cheng District,
Tel: (8610) 59376700 Fax: (8610) 59376729
Shanghai Hongkou Sub-branch
Unit 605-608 6F and Unit 707-708 7F and Unit 803A, 806,
807 8F and Unit 103, 1F, No.1500, North Sichuan Road, P.R.China 200080
Tel: (8621) 26012288 Fax: (8621) 63071396
25
02 BEIJING
Beijing Chang-an Sub-branch
1/F, Tower 1, Bright China Chang An Building, No.7 Jianguomennei Avenue,
Tel: (8610) 59379366 Fax: (8610) 65102450
BRANCH NETWORK - CONSUMER OUTLETS
26
Beijing Zhong Guan Cun Sub-branch
Room 04 & 05, 1st Floor, Ideal Plaza, No. 58 West Road,
North Fourth Ring, Haidian District, Beijing, P.R.China 100080
Tel: (8610) 59379288
Fax: (8610) 82607211
27
03 GUANGZHOU
Guangzhou Fortune Plaza Sub-branch
Unit 101, Fortune Plaza, No.118 TiYu East Road, Tian He District,
Guangzhou, P.R.China 510620
Tel: (8620) 38171888
Fax: (8620) 38931628
Kerry Centre Sub-branch
Unit 201, 2F, North Office Building and Unit 02, 1F,Kerry Center,
No.1 Guang Hua Road, Chao Yang District, Beijing, P.R.China 100020
Tel: (8610) 59379000 Fax: (8610) 85298755
Guangzhou Huan Shi Dong Sub-branch
1/F, Asian International Hotel, No.326 Huanshidong Road,
Guangzhou, P.R. China 510133
Tel: (8620) 38171021
Fax: (8620) 83866918
Beijing Upper East Side Sub-branch
A09-A15, Upper East Side Central Plaza, No.6 North Ave,
East 4th Ring Road, Chaoyang District, Beijing, P.R.China 100016
Tel: (8610) 59379100 Fax: (8610) 51307131
Guangzhou Wanguo Plaza Sub-branch
Unit 1002, 1st Floor, No.131,133,135,137, Jiangnan Middle Avenue,Haizhu District,
Guangzhou, Guangdong, P.R. China 510220
Tel: (8620) 38171099 Fax: (8620) 84499860
Beijing Pacific Century Sub-Branch
Unit 109, First Floor, Pacific Century Shopping Mall,
Jia 2 Gongti North Road, Beijing, P.R.China, 100027
Tel: (8610) 59379200 Fax: (8610) 65392716
Guangzhou Nong Jiang Suo Sub-branch
Unit 3, 1F, No 34-2, Zhongshan Fourth Road,
Yuexiu District , Guangzhou, Guangdong, P.R. China,510030
Tel: (8620) 38171688
Fax: (8620) 83893730
Beijing Asian Games Village Sub-branch
Unit 1012, 1013, Tower C, No 103,
Huizhongli, Chaoyang District, Beijing, P.R.China, 100027
Tel: (8610) 59379050 Fax: (8610) 84871619
Shenzhen Shum Yip Sub-branch
1/F, Shum Yip Center (Beside the Book City),
No. 5045 Shen Nan East Road, Shenzhen, P.R.China 518010
Tel: (86755) 22945188 Fax: (86755) 82083401
04 SHENZHEN
Beijing Jin Bao Jie Sub-branch
Room F1-1, F1-2, CITS Plaza shopping center, No.1 North Dong Dan Street,
Dong Cheng District, Beijing, P.R.China 100005
Tel: (8610) 59379188 Fax: 65597386
Shenzhen Futian Sub-branch
Room 105, Duty Free Building,
Yitian Road, Futian District, Shenzhen, P.R.China 518048
Tel: (86755) 8276633 Fax: (86755) 88820518
Beijing Wangjing Sub-branch
Unit 105, No. 429 Wangjing Xiyuan, Guangshun North Street,
Chaoyang, Beijing, P.R.China,100102
Tel: (8610) 59379333 Fax:(8610) 64716804
Shenzhen Nanshan Sub-branch
North 1F, Jinhai Building,
No.2748, Nanhai Avenue, Nanshan District, Shenzhen, P.R.China 518054
Tel: (86755) 86122988 Fax: (86755) 86121161
28
05 CHENGDU
06 TIANJIN
29
Shenzhen Chegongmiao Sub-branch
Podium 101-B103, NEO Lvgen Plaza, Che Gong Miao, Shennan Avenue,
Futian District, Shenzhen, P.R.China 518010
Tel: (86755) 82718199 Fax: (86755) 82777282
Tianjin Youyi Road Sub-branch
Unit 101 & 201, Zhongfu Tower, No.1 Youyi Road,
Hexi District, Tianjin, P.R.China 300201
Tel: (8622) 28353003 Fax: (8622) 28350282
Shenzhen Luohu Sub-branch
No. 2041-1, 1st Floor, Xi Long Building, Renmin South Road, Luohu,
Shenzhen, P.R.China 518001
Tel: (86755) 82257866 Fax: (86755) 82235166
Tianjin Jin Tower Sub-branch
Unit 3, No 160, Zhang Zi Zhong Road,
Heping District, Tianjin, P.R. China 300041
Tel: (8622) 58356150 Fax: (8622) 58356162
Chengdu Sub-branch
Unit 101, 1/F, City Tower, No.86 Section 1 Renminnan Road, Chengdu
Sichuan, P.R.China 610016
Tel: (8628) 86110066 Fax: (8628) 86202328
Tianjin Qi Xiang Tai Road Sub-branch
Unit. 6, No. 89 Qi Xiang Tai Road,
Hexi District, Tianjin, P.R. China 300074
Tel: (8622) 83118000
Fax: (8622) 83118058
Chengdu Fund International Plaza Sub-branch
1F, Unit 4~5, No 6, Hangkong Road,
Wuhou District, Chengdu, P.R.China 610041
Tel: (8628) 61517766 Fax: (8628) 61517878
Hangzhou Sub-branch
Ground Floor, Jia De Plaza, No. 118 Qing Chun Road,
Hangzhou, P.R. China 310003
Tel: (86571) 87229191 Fax: (86571) 87222872
07 HANGZHOU
Chengdu Dong Da Jie Sub-branch
Unit A, Room 103 and 105, 1F, Building 1, No 35,
Zi Dong Lou Duan, Dongdajie Street, Chengdu, P.R.China 610061
Tel: (8628) 65280016 Fax: (8628) 65280019
Hangzhou Huanglong Sub-branch
Room 109-110, Floor 1, Jiahua International Business Center,
No.15 Hangda Road, Hangzhou, P.R. China 310007
Tel: (86571) 87687028 Fax: (86571) 87687027
Tianjin Sub-branch
R102/1810, The Exchange Tower No.1, No.189 Nanjing Road, Heping Destrict,
Tel: (8622) 58900688 Fax: (8622) 83191800
Hangzhou Chengxi Sub-branch
No 81, Wen Er West Road,
Hangzhou, P.R.China 310012
Tel: (86571) 88250866 Fax: (86571) 88255603
Tianjin Binhai Sub-branch
Level 1&2, 23 Fortune Plaza, No.21 Third Avenue, TEDA,
Tel: (8622) 66209229 Fax: (8622) 66219980
Hangzhou Xin Tang Road Sub-branch
Unit 110 , 111, No. 99 Xintang Road,
Hangzhou, P.R.China 310020
Tel: (86571) 88908018 Fax: (86571) 28972758
30
08 DALIAN
Dalian Branch
1F, Podium Building and unit 12, 01-03, 18F , Wanda Center, No 6,
Gangxing Road, Zhongshan District, Dalian, P.R.China 116001
Tel: (86411) 39075588 Fax: (86411) 39027518
Dalian Xinghai Bay Sub-branch
No 451-13, Zhongshan Road, Shahekou district, Dalian,
P.R.China 116021
Tel: (86411) 39570188 Fax: (86411) 39570166
Dalian Xigang Sub-branch
No. 232 & 234 Zhongshan Road, Xigang District, Dalian,
P.R.China 116011
Tel: (86411) 83729700 Fax: (86411) 83729726
09 CHONGQING
11 NANJING
Nanjing Branch
1F-2F, Nanjing World Trade Center,
No. 2 Hanzhong Road, Nanjing, P.R.China 210005
Tel:(8625)88011088 Fax:(8625)89602700
12 CHANGSHA
Changsha Branch
2F, No.110, Furong Middle Road,
2nd Section, Changsha, P.R.China 410015
Tel: (86731)89860518 Fax:(86731)89860428
13 WUXI
Wuxi Branch
1F, 2F, & unit 0701-0703, 0712, 0715-0722,
7F, No.218, Jin Jiang Hotel, Zhongshan Road,Wuxi, P.R.China 214002
Tel:(86510)82799668 Fax:(86510)82750389
Chongqing Branch
1F, No 185, and 2F, No 189, Zhonghua Rd, International Trade Center,
Yuzhong district, Chongqing, P.R.China 400010
Tel: (8623) 63106395 Fax: (8623) 63106361
Chongqing Airport Sub-branch
Terminal T2A (Departure Hall, beside Gate 4),
Chongqing Jiangbei International Airport, P.R.China 401120
Tel: (8623) 67155079 Fax: (8623) 67155431
Chongqing Bei Cheng Tian Jie Sub-branch
Unit 16, No. 12 Bei Cheng Tian Jie,
Jiang bei District, P.R.China 400020
Tel: (8623) 67855956 Fax: (8623) 67857217
10 GUIYANG
31
Guiyang Branch
Unit 1-01, No 215, Fushui South Road,
Nanming District, Guiyang, P.R.China 550002
Tel:(86851)5285888 Fax:(86851)5258007
32
CITIBANK (CHINA) COMPANY LIMITED
ENGLISH TRANSLATION OF FINANCIAL STATEMENTS
FOR THE YEAR FROM 1 JANUARY 2013 TO 31 DECEMBER 2013
IF THERE IS ANY CONFLICT BETWEEN THE CHINESE
VERSION AND ITS ENGLISH TRANSLATION,
THE CHINESE VERSION WILL PREVAIL
33
Citibank (China) Company Limited
Balance Sheet as at 31 December 2013
(Expressed in Renminbi Yuan)
Balance Sheet as at 31 December 2013 (continued)
Note
2013
Note
2012
Assets
2013
2012
Liabilities:
Cash on hand and deposits
Deposits from inter-banks and
with central bank
5
26,885,794,247
30,637,522,420
non-bank financial institution
16
20,601,138,894
12,308,582,670
Deposits with inter-banks
6
7,650,815,916
12,786,085,145
Borrowings from inter-banks
17
10,492,510,490
6,751,057,744
Placements with inter-banks
7
30,707,510,787
23,311,688,269
Derivative financial liabilities
9
2,844,811,150
1,430,554,047
Trading financial assets
8
3,266,961,398
3,512,945,036
Financial assets sold under repurchase agreements
18
-
7,920,000,000
Derivative financial assets
9
2,828,654,593
1,690,055,766
Deposits from customers
19
96,624,103,633
103,566,097,380
520,846,457
457,176,967
Employee benefits payable
20
241,120,930
228,251,112
4(3)
214,014,543
180,510,101
451,104,989
252,270,780
9,891,133,757
9,153,222,437
141,359,938,386
141,790,546,271
Interest receivable
Loans and advances to customers
10
61,387,928,396
62,950,509,681
Available-for-sale financial assets
11
17,228,779,130
16,135,172,130
Fixed assets
12
62,383,285
74,135,564
Intangible assets
13
69,355,354
80,561,003
Deferred tax assets
14
213,529,169
95,285,122
Other assets
15
1,925,037,788
602,916,077
152,747,596,520
152,334,053,180
Total assets
Taxes payable
Interest payable
21
Other liabilities
Total liabilities
Equity
Paid-in capital
22
3,970,000,000
3,970,000,000
Capital reserve
23
(86,245,081)
33,724,090
Surplus reserve
24
702,043,313
605,631,273
General reserve
25
1,476,690,285
1,305,394,495
Retained earnings
5,325,169,617
4,628,757,051
Total equity
11,387,658,134
10,543,506,909
152,747,596,520
152,334,053,180
Total liabilities and equity
These financial statements were approved by the Board of Directors.
Andrew Au
Kai Zhang
Company stamp
Chief Executive Officer
Chief Financial Officer
Date：14 Apr 2014
The notes on pages 8 to 82 of these financial statements.
34
The notes on pages 8 to 82 form part of these financial statements.
35
Income Statement for the year ended 31 December 2013
Note
Operating income
Net interest income
Interest income
Interest expenses
27
Net fee and commission income
Fee and commission income
Fee and commission expenses
28
Cash Flow Statement for the year ended 31 December 2013
2013
2012
Note
4,352,882,044
4,628,461,238
Cash flows from operating activities
2,602,809,464
4,393,500,690
(1,790,691,226)
2,690,207,368
4,408,561,165
(1,718,353,797)
Net decrease in deposits with central bank and inter-banks
617,919,568
713,879,351
(95,959,783)
497,422,633
590,755,963
(93,333,330)
29
30
Operating expenses
4(1)
31
32
Business taxes and surcharges
General and administrative expenses
Impairment losses (charge) / reversal
2012
95,488,384
-
3,078,658,961
-
-
6,780,294,763
1,350,562,477
16,494,135,837
29,395,650
209,516,790
-
1,734,284,034
Interest, fee and commission receipts
Refund of taxes
5,001,433,123
5,687,000
5,119,753,866
12,872,000
532,657,662
170,908,408
10,093,883,257
---------------------
30,521,765,698
---------------------
Net decrease in loans and advances to customers
Net increase in borrowings from inter-banks
and non-bank financial institutions
Net increase in deposits from customers and inter-banks
Cash received from returns on trading financial assets
Investment income
(Losses) / gains from changes in fair value
Foreign exchange gains
Other operating income
2013
736,869,649
(266,550,720)
626,739,267
35,094,816
908,881,187
34,477,582
342,775,514
154,696,953
(3,125,942,378)
(2,811,830,342)
Cash received relating to other operating activities
(242,237,669)
(2,715,335,079)
(168,369,630)
(270,559,583)
(2,547,727,861)
6,457,102
Sub-total of cash inflows from operating activities
Cash received from disposals of trading financial assets
Net increase in deposits with central bank
Operating profit
1,226,939,666
Add: Non-operating income
Less: Non-operating expenses
6,634,513
(2,649,273)
Profit before income tax
Less: Income tax expense
1,230,924,906
4(2)/33
1,816,630,896
15,001,545
(3,651,857)
1,827,980,584
(266,804,510)
(454,767,618)
964,120,396
1,373,212,966
and inter-banks
Net increase in loans and advances to customers
-
Net decrease in borrowings from inter-banks
and non-bank financial institutions
(10,255,221,634)
(790,357,194)
(1,687,816,800)
(1,754,454,271)
Cash paid to and for employees
Cash paid for all types of taxes
(1,381,371,282)
(888,425,895)
(1,188,576,641)
(1,072,285,865)
(52,057,594)
(71,264,868)
(15,055,250,399)
(9,476,335,521)
---------------------
---------------------
(4,961,367,142)
---------------------
21,045,430,177
---------------------
Sub-total of cash outflows from operating
activities
Net profit for the year
Other comprehensive income for the year
34
964,120,396
(119,969,171)
1,373,212,966
23,366,677
Net cash (outflow) / inflow from
35(1)
operating activities
Total comprehensive income for the year
844,151,225
36
-
Cash paid for acquisition of trading financial assets
Interest, fee and commission payments
Cash paid relating to other operating activities
Net profit for the year
(349,478,616)
(5,040,275,260)
1,396,579,643
37
Cash Flow Statement for the year ended 31 December 2013 (continued)
Note
Statement of Changes in Equity for the year ended 31 December 2013
2013
2012
Cash received from disposals of investments
11,283,281,490
4,796,060,687
Cash received from returns on investments
Cash received from disposals of fixed assets
573,694,845
103,000
510,158,540
-
paid-in
capital
Note
Capital
reserve
Surplus
reserve
General
reserve
Retained
earnings
Total
Cash flows from investing activities
Balance at 1 January 2013
3,970,000,000
605,631,273
1,305,394,495
------------------- ------------------- -------------------
-------------------
Cash paid for acquisition of investments
Cash paid for acquisition of fixed assets,
11,857,079,335
5,306,219,227
---------------------
---------------------
(11,587,141,324)
(9,492,476,412)
-
long-term assets
(55,916,647)
(121,278,910)
-------------------
-------------------
-
964,120,396
-
-
964,120,396
2. Other comprehensive
income
34
Subtotal of 1 and 2
-
(119,969,171)
-
-
-
-
(119,969,171)
-
-
964,120,396
844,151,225
------------------- ------------------- -------------------
-------------------
-------------------
-------------------
intangible assets and other
4,628,757,051 10,543,506,909
Changes in equity for the year
1. Net profit for the year
Sub-total of cash inflows from investing
activities
33,724,090
3.
(119,969,171)
Appropriation of profits
- Appropriation for
Sub-total of cash outflows from investing
surplus reserve
activities
(11,643,057,971)
(9,613,755,322)
---------------------
---------------------
24, 26
-
-
96,412,040
-
(96,412,040)
-
25, 26
-
-
-
171,295,790
(171,295,790)
-
- Appropriation for
general reserve
Net cash inflow / (outflow) from investing
activities
214,021,364
---------------------
(4,307,536,095)
---------------------
Balance at
31 December 2013
3,970,000,000
(86,245,081) 702,043,313
Effect of foreign exchange rate changes
on cash and cash equivalents
(507,423,612)
(9,570,523)
---------------------
---------------------
(5,254,769,390)
16,728,323,559
40,544,135,948
23,815,812,389
35,289,366,558
40,544,135,948
Net (decrease) / increase in cash and cash
equivalents
35(2)
Add: Cash and cash equivalents at the
beginning of the year
Cash and cash equivalents at the end
of the year
35(3)
38
39
1,476,690,285
5,325,169,617
11,387,658,134
Statement of Changes in Equity for the year ended 31 December 2012 (continued)
Note
Balance at 1 January 2012
paid-in
capital
3,970,000,000
Capital
reserve
Surplus
reserve
10,357,413 468,309,977
-------------------------------------- -------------------
General
reserve
Retained
earnings
818,441,173 3,879,818,703
-------------------
-------------------
Notes to the Financial Statements
01 General information
Total
9,146,927,266
-------------------
Citibank (China) Company Limited (Citibank China or the
English from the Bank’s statutory financial statements
Bank) is a wholly foreign-owned bank incorporated in
issued in the PRC in Chinese.
Shanghai, the People’s Republic of China (PRC), estabThe financial statements have been prepared on the
lished by Citibank, N.A. (Citibank or the Investor).
basis of going concern.
Changes in equity for the year
With the approval of the China Banking Regulatory Com-
1. Net profit for the year
-
2. Other comprehensive
income
34
Subtotal of 1 and 2
3.
-
-
-
23,366,677
-
23,366,677
-
1,373,212,966
-
1,373,212,966
23,366,677
-
-
1,373,212,966
1,396,579,643
-------------------------------------- -------------------
-------------------
-------------------
-------------------
(1) Statement of compliance
mission (the CBRC) issued on 22 December 2006, Citibank transformed its Shanghai Branch, Shenzhen Branch,
Guangzhou Branch, Beijing Branch, Tianjin Branch and
The financial statements have been prepared in accord-
Chengdu Branch which were set up in China during 1988
ance with the requirements of “Accounting Standards
to 2005 into Citibank China, a wholly foreign-owned
for Business Enterprises – Basic Standard” and 38
bank invested solely by Citibank.
Specific Standards issued by the Ministry of Finance
(MOF) of PRC on 15 February 2006, and application
Appropriation of profits
- Appropriation for
surplus reserve
24, 26
-
-
137,321,296
-
(137,321,296)
-
- Appropriation for
general reserve
25, 26
-
-
-
486,953,322
(486,953,322)
-
Balance at
31 December 2012
The Bank obtained a financial license on 20 March 2007
guidance, bulletins and other relevant regulations
and a business license (qi du hu zong zi No. 043865)
issued
[Municipal Bureau] issued by the Shanghai Administra-
“Accounting Standards for Business Enterprises” or
tion of Industry and Commerce on 29 March 2007, and
“CAS”). These financial statements present truly and
subsequently
(No.
completely the financial position of the Bank as at 31
310000400507900) [Municipal Bureau] from the
December 2013, financial performance and the cash
Shanghai Administration of Industry and Commerce
flows of the Bank for the year then ended.
obtained
a
revised
license
subsequently
(collectively
referred
to
as
after commencement of operation. The Bank’s regis3,970,000,000 33,724,090
605,631,273 1,305,394,495 4,628,757,051 10,543,506,909
tered capital is Renminbi 3,970,000,000. In accordance
(2) Accounting year
with the Bank’s business license, the Bank has an undefined operating period from 29 March 2007. The Bank
The Bank’s accounting year is from 1 January to 31
commenced operation on 2 April 2007 and its scope of
December.
operation includes partial or full scope foreign currency
business and Renminbi business, approved by relevant
regulators.
(3) Measurement basis
As at 31 December 2013, the Bank had 13 branches and
The measurement basis used in the preparation of the
41 sub-branches in Shanghai, Shenzhen, Guangzhou,
financial statements is historical cost basis except for
Beijing, Tianjin, Chengdu, Hangzhou, Dalian, Chongqing,
the assets and liabilities set out below:
Guiyang, Nanjing, Changsha, and Wuxi.
Financial assets and financial liabilities at fair value
through profit or loss (including financial assets or
02 Basis of preparation
financial liabilities held for trading) (see Note 3(2)).
Available-for-sale financial assets (see Note 3(2)).
40
These financial statements have been translated into
41
(4) Functional currency and presentation
currency
lation of available-for-sale financial assets, which are
profit or loss; for other categories of financial assets
Available-for-sale financial assets include non-deriva-
recognised as other comprehensive income in capital
and financial liabilities, any related directly attributable
tive financial assets that are designated upon initial
reserve.
transaction costs are included in their initial costs.
recognition as available for sale and other financial
Subsequent to initial recognition, financial assets and
assets which do not fall into any of the above categories.
The Bank’s functional currency is Renminbi. These
financial statements are presented in Renminbi. Func-
liabilities are measured as follows:
(2) Financial instruments
tional currency is determined by the Bank on the basis
of the currency in which major income and costs are
Available-for-sale investments in equity instruments
Financial instruments of the Bank include cash on hand
denominated and settled.
and
deposits
with
central
bank,
deposits
with
inter-banks, placements with inter-banks, trading financial assets, derivative financial assets, interest receiva-
03 Significant accounting polices
and accounting estimates
ble, loans and advances to customers, available-for-sale
financial assets, deposits from inter-banks and non-bank
financial institutions, borrowings from inter-banks,
(1) Translation of foreign currencies
derivative financial liabilities, financial assets sold under
repurchase agreements, deposits from customers,
When the Bank receives capital in foreign currencies
employee benefits payable, interest payable and paid-in
from investors, the capital is translated to Renminbi at
capital.
the spot exchange rate on the date of receipt. Other
foreign currency transactions are, on initial recognition,
(a) Recognition and measurement of financial assets
translated to Renminbi at the spot exchange rates on
and financial liabilities
Financial assets and financial liabilities at fair value
whose fair value cannot be measured reliably are meas-
through profit or loss (including financial assets or
ured at cost subsequent to initial recognition. Other
financial liabilities held for trading)
available-for-sale financial assets are measured at fair
value subsequent to initial recognition and changes
A financial asset or financial liability is classified as at
therein, except for impairment losses and foreign
fair value through profit or loss if it is acquired or
exchange gains and losses from monetary financial
incurred principally for the purpose of selling or repur-
assets which are recognised directly in profit or loss, are
chasing in the near term or if it is a derivative. Subse-
recognised as other comprehensive income in capital
quent to initial recognition, financial assets and financial
reserve. When an investment is derecognised, the cumu-
liabilities at fair value through profit or loss are meas-
lative gain or loss is reclassified from equity to profit or
ured at fair value, and changes therein are recognised in
loss. Interest on available-for-sale financial assets calcu-
profit or loss.
lated using the effective interest method is recognised
in profit or loss.
Loans and receivables
Other financial liabilities
the dates of the transactions. A spot exchange rate is an
exchange rate quoted by the People’s Bank of China (the
A financial asset or financial liability is recognised in the
PBOC), the State Administration of Foreign Exchanges
balance sheet when the Bank becomes a party to the
or a cross rate determined based on quoted exchange
contractual provisions of a financial instrument.
rates.
The Bank classifies financial assets and liabilities into
Monetary items denominated in foreign currencies are
the different categories at initial recognition based on
translated to Renminbi at the spot exchange rate at the
the purpose of acquiring assets or assuming liabilities:
balance sheet date. The resulting exchange differences
financial assets and financial liabilities at fair value
are recognised in profit or loss. Non-monetary items
through
denominated in foreign currencies that are measured at
profit
or
loss,
loans
and
receivables,
held-to-maturity investments, available-for-sale finan-
historical cost are translated to Renminbi using the
cial assets and other financial liabilities.
foreign exchange rate at the transaction date. Non-monetary items denominated in foreign currencies that are
measured at fair value are translated using the foreign
Financial assets and financial liabilities are measured
exchange rate at the date the fair value is determined;
initially at fair value. For financial assets and financial
the resulting exchange differences are recognised in
liabilities at fair value through profit or loss, any related
profit or loss, except differences arising from the trans-
Loans and receivables are non-derivative financial
assets with fixed or determinable payments that are not
Financial liabilities other than financial liabilities at fair
quoted in an active market. Subsequent to initial recog-
value through profit or loss are classified as other finan-
nition, loans and receivables are measured at amortised
cial liabilities.
cost using the effective interest method.
Other financial liabilities include the liabilities arising
from financial guarantee contracts. Financial guaran-
Held-to-maturity investments
tees are contracts that require the Bank (i.e. the guaranHeld-to-maturity investments are non-derivative finan-
tor) to make specified payments to reimburse the bene-
cial assets with fixed or determinable payments and
ficiary of the guarantee (the holder) for a loss the holder
fixed maturity that the Bank has the positive intention
incurs because a specified debtor fails to make payment
and ability to hold to maturity. Subsequent to initial
when due in accordance with the terms of a debt instru-
recognition, held-to-maturity investments are measured
ment. Where the Bank issues a financial guarantee,
at amortised cost using the effective interest method.
subsequent to initial recognition, the guarantee is measured at the higher of the amount initially recognised less
accumulated amortisation and the amount of a provi-
sion determined in accordance with the principles of
directly attributable transaction costs are charged to
42
43
contingencies (see Note 3(11)).
Except for the liabilities arising from financial guarantee
(d) Derecognition of financial assets and financial
fair value with changes in fair value recognised in profit
The cost of a purchased fixed asset comprises the
liabilities
or loss.
purchase price, related taxes, and any directly attributa-
A financial asset is derecognised if the Bank’s contractu-
contracts described above, subsequent to initial recog-
al rights to the cash flows from the financial asset expire
nition, other financial liabilities are measured at amor-
or if the Bank transfers substantially all the risks and
tised cost using the effective interest method.
rewards of ownership of the financial asset to another
party. Where a transfer of a financial asset in its entirety
(b) Presentation of financial assets and financial liabil-
meets the criteria of derecognition, the difference
ities
between the two amounts below is recognised in profit
or loss:
Financial assets and financial liabilities are presented
separately in the balance sheet and are not offset. How-
the carrying amount of the financial asset transferred
ever, a financial asset and a financial liability are offset
and the net amount is presented in the balance sheet
the sum of the consideration received from the trans-
when both of the following conditions are satisfied:
fer and any cumulative gain or loss that has been recognised directly in equity.
the Bank has a legal right to set off the recognised
amounts and the legal right is currently enforceable;
The Bank derecognises a financial liability (or part of it)
and
ble expenditure for bringing the asset to working condiIf an embedded derivative is separated, the host
tion for its intended use. The cost of self-constructed
contract shall be accounted for in accordance with (a)
assets includes the cost of materials, direct labour,
and (b) in this notes.
capitalised borrowing costs, and any other costs directly
attributable to bringing the asset to working condition
(3) Cash and cash equivalents
for its intended use.
Cash and cash equivalents comprise cash on hand,
Where the parts of an item of fixed assets have different
non-restricted balances with central banks, deposits
useful lives or provide benefits to the Bank in a different
with inter-banks, placements with inter-banks, and
pattern, thus necessitating use of different depreciation
short-term, highly liquid investments, which are readily
rates or methods, each part is recognised as a separate
convertible into known amounts of cash and are subject
fixed asset.
to an insignificant risk of change in value.
The subsequent costs including the cost of replacing
part of an item of fixed assets, are recognised in the
(4) Financial assets sold under repurchase agreements
carrying amount of the item if the criteria to recognised
fixed assets are satisfied, and the carrying amount of
only when the underlying present obligation (or part of
it) is discharged, cancelled or expires.
the Bank intends either to settle on a net basis, or to
the replaced part is derecognised. The costs of the
Financial assets sold under repurchase agreements are
day-to-day servicing of fixed assets are recognised in
recorded as the amount actually received when the
realise the financial asset and settle the financial liability
simultaneously.
(e) Embeded derivatives
An embedded derivative is a component of a hybrid
(c) Determination of fair value
(combined) instrument that also include both the derivaIf there is an active market for a financial asset or finan-
tive and a host contract with the effect that some of the
cial liability, the quoted price in the active market is used
cash flows of the hybrid (combined) instrument vary in a
to establish the fair value of the financial asset or finan-
way similar to a stand-alone derivative.
cial liability. If no active market exists for a financial
instrument, a valuation technique is used to establish
The embedded derivative are separated from the host
the fair value. Valuation techniques include using recent
contract and accounted for as a derivative when: (i) the
arm’s-length market transactions between knowledgea-
economic characteristics and risks of the embedded
ble, willing parties, reference to the current fair value of
derivative are not closely related to the economic char-
another instrument that is substantially the same,
acteristics and risks of the host contract; (ii) a separate
discounted cash flow analysis, option pricing models,
instrument with the same terms as the embedded deriv-
and etc. The Bank calibrates its valuation technique and
ative would meet the definition of a derivative; and (iii)
tests it for validity periodically.
the hybrid (combined) instrument is not measured at
44
profit or loss as incurred. Gains or losses arising from
transactions occur, and are carried in the balance sheet.
the retirement or disposal of an item of fixed asset are
The underlying assets of the repurchase agreements
determined as the difference between the net disposal
continue to be recorded in the balance sheet and meas-
proceeds and the carrying amount of the item, and are
ured accordingly.
recognised in profit or loss on the date of retirement or
disposal.
The difference between the sale and repurchase consideration is amortised over the period of the respective
The cost of fixed assets, less its estimated residual value
transaction using the effective interest method and
and accumulated impairment losses, is depreciated
included in interest expenses.
using the straight-line method over its estimated useful
life, unless the fixed assets are classified as held for sale.
(5) Fixed assets
The estimated useful lives, residual value rates and
depreciation rates of each class of fixed assets are as
Fixed assets represent the tangible assets held by the
follows:
Bank for administrative purposes with useful lives over
one year. Fixed assets are stated in the balance sheet at
cost less accumulated depreciation and impairment
losses (see Note 3(8)(b)).
45
Asset
type
Estimated
useful life
Residual
value rate
(8) Impairment of assets
Depreciation
rate
(a) Impairment of fiancial assets
Office and other
equipment
Motor vehicles
3 -5 years
0%
20% - 33.33%
5 years
0%
20%
The carrying amounts of financial assets (other than
those at fair value through profit or loss) are reviewed
at each balance sheet date to determine whether there
is objective evidence of impairment. If any such
Useful lives, residual value and depreciation methods
evidence exists, an impairment loss is recognised.
are reviewed at least at each year-end.
Loans and receivables and held-to-maturity invest-
(6) Operating lease charges
ments
Rental payments under operating leases are recognised
Held-to-maturity investments are assessed for impair-
as part of the cost of another related asset or as expens-
ment on an individual basis. Loans and receivables are
es on a straight-line basis over the lease term. Contin-
assessed for impairment both on an individual basis and
gent rental payments are recognised as expenses in the
on a collective group basis.
accounting period in which they are incurred.
Where impairment is assessed on an individual basis, an
impairment loss in respect of a loan and receivable or
(7) Intangible assets
held-to-maturity investment is calculated as the excess
of its carrying amount over the present value of its
Intangible assets are stated in the balance sheet at cost
estimated future cash flows (exclusive of future credit
less accumulated amortisation (where the estimated
losses that have not been incurred) discounted at the
useful life is finite) and impairment losses (see Note
original effective interest rate. All impairment losses are
3(8)(b)). For an intangible asset with a finite useful life,
recognised in profit or loss.
its cost less estimated residual value and accumulated
impairment losses is amortised on the straight-line
An assessment is made collectively where loans and
method over its estimated useful life, unless it is classi-
receivables share similar credit risk characteristics
fied as held for sale. At the balance sheet date, the
(including those not individually assessed as impaired),
Bank’s intangible assets consisted of software, which is
based on their historical loss experiences, and adjusted
amortised over three to ten years.
by the observable factors reflecting present economic
conditions.
An intangible asset is regarded as having an indefinite
useful life and is not amortised when there is no foresee-
If, after an impairment loss has been recognised on
able limit to the period over which the asset is expected
loans and receivables or held-to-maturity investments,
to generate economic benefits for the Bank. At the
there is objective evidence of a recovery in value of the
balance sheet date, the Bank did not have any intangible
financial asset which can be related objectively to an
assets with indefinite useful lives.
event occurring after the impairment was recognised,
46
the previously recognised impairment loss is reversed
An asset group is the smallest identifiable group of
through profit or loss. A reversal of an impairment loss
assets that generates cash inflows and that is largely
will not result in the asset’s carrying amount exceeding
independent of the cash inflows from other assets or
what the amortised cost would have been had no impair-
asset groups. An asset group is composed of assets
ment loss been recognised in prior years.
directly related to cash-generation. Identification of an
asset group is based on whether major cash inflows
generated by the asset group are largely independent of
the cash inflows from other assets or asset groups. In
Available-for-sale financial assets are assessed for
identifying an asset group, the Bank also considers how
impairment on an individual basis. When an availa-
management monitors the Bank’s operations and how
ble-for-sale financial asset is impaired, the cumulative
management makes decisions about continuing or
loss arising from decline in fair value that has been
disposing of the Bank’s assets.
recognised directly in equity is reclassified to profit or
loss even though the financial asset has not been derec-
The recoverable amount of an asset, asset group or set
ognised. If, after an impairment loss has been recog-
of asset groups is the higher of its fair value less costs to
nised on an available-for sale debt instrument, the fair
sell and the present value of expected future cash flows.
value of the debt instrument increases in a subsequent
An asset’s fair value less costs to sell is the amount
period and the increase can be objectively related to an
determined by the price of a sale agreement in an
event occurring after the impairment loss was recog-
arm’s-length transaction less the costs that are directly
nised, the impairment loss is reversed through profit or
attributable to the disposal of the asset. The present
loss.
value of the expected future cash flows of an asset is
determined by discounting the future cash flows,
(b) Impairment of other assets
estimated to be derived from continuing use of the asset
and from its ultimate disposal to their present value
The carrying amounts of the following assets are
using an appropriate pre-tax discount rate.
reviewed at each balance sheet date based on the internal and external sources of information to determine
If the result of the recoverable amount calculation
whether there is any indication of impairment:
indicates the recoverable amount of an asset is less
than its carrying amount, the carrying amount of the
fixed assets
asset is reduced to its recoverable amount. That reduc-
intangible assets
tion is recognised as an impairment loss and charged to
profit or loss for the current period. A provision for
If any indication exists that an asset may be impaired,
impairment of the asset is recognised accordingly. For
the recoverable amount of the asset is estimated. In
impairment losses related to an asset group or a set of
addition, the Bank estimates the recoverable amounts
asset groups, reduce the carrying amount of the other
of intangible assets with indefinite useful lives that have
assets in the asset group or set of asset groups on a pro
yet to reach a working condition at least once during
rata basis. However, the carrying amount of an impaired
each year irrespective of whether there is any indication
asset will not be lower than the greatest amount of its
of impairment.
47
ty-settled share-based payments.
individual fair value less costs to sell (if determinable),
the differences between the carrying amounts of assets
(d) Termination benefits
and liabilities for financial reporting purposes and their
the present value of expected future cash flows (if
Where the Bank uses shares or other equity instruments
When the Bank terminates the employment relationship
tax bases, which include the deductible losses and tax
as consideration for services received from employees,
with employees before the employment contracts
credits
Once an impairment loss is recognised, it is not reversed
the payment is measured at the fair value of the equity
expire, or provides compensation as an offer to encour-
Deferred tax assets are recognised to the extent that it
in a subsequent period.
instruments granted to the employees. If the equity
age employees to accept voluntary redundancy, a provi-
is probable that future taxable profits will be available
instruments granted to employees vest immediately,
sion for the termination benefits to be provided is
against which deductible temporary differences can be
the fair value of the equity instruments granted on its
recognised in profit or loss when both of the following
utilised.
grant date is recognised as a relevant cost or expense
conditions are satisfied:
determinable) and zero.
(9) Employee benefits
carried
forward
to
subsequent
periods.
Employee benefits are all forms of consideration given
with a corresponding increase in capital reserve. If the
and other related expenditures incurred in exchange for
equity instruments granted to employees do not vest
The Bank has a formal plan for the termination of
es arising from the initial recognition of assets or liabili-
services rendered by employees. Except for termination
until the completion of services for a vesting period, or
employment or has made an offer to employees for
ties in a transaction that is not a business combination
benefits, employee benefits are recognised as a liability
until the achievement of a specified performance condi-
voluntary redundancy, which will be implemented short-
and that affects neither accounting profit nor taxable
in the period in which the associated services are
tion, the Bank, at each balance sheet date during the
ly;
profit (or tax loss).
rendered by employees, with a corresponding increase
vesting period, makes the best estimation according to
in the cost of relevant assets or expenses in the current
the latest information of the number of employees who
period.
are granted to vest and revises the number of equity
Deferred tax is not recognised for temporary differenc-
The Bank is not allowed to withdraw from termination
At the balance sheet date, the amount of deferred tax
plan or redundancy offer unilaterally.
recognised is measured based on the expected manner
of recovery or settlement of the carrying amount of the
instruments expected to vest. Based on its best estima(a) Social insurance and housing fund
tion, the Bank recognises the services received for the
current period as related costs or expenses, with a
(10) Income tax
assets and liabilities, using tax rates that are expected
or the liability is settled in accordance with tax laws.
to be applied in the period when the asset is recovered
Pursuant to the relevant laws and regulations of the
corresponding increase in capital reserve, at an amount
PRC, employees of the Bank participate in the social
Current tax and deferred tax are recognised in profit or
equal to the fair value of the equity instruments at the
insurance system established and managed by govern-
loss except to the extent that they relate to a business
grant date.
combination or items recognised directly in equity
The carrying amount of a deferred tax asset is reviewed
(including other comprehensive income).
at each balance sheet date. The carrying amount of a
ment organisations. The Bank makes social insurance
contributions, including contributions to basic pension
When the Bank receives services but has no obligation
insurance, basic medical insurance, unemployment
to settle the transaction, and the related equity instru-
Current tax is the expected tax payable calculated at the
longer probable that sufficient taxable profits will be
insurance, work-related injury insurance, maternity
ments are issued by the Bank’s ultimate parent, the
applicable tax rate on taxable income for the year, plus
available to allow the benefit of the deferred tax asset
insurance and etc., as well as contributions to housing
Bank recognises the transaction as an equity-settled
any adjustment to tax payable in respect of previous
to be utilised. Such reduction is reversed to the extent
fund, at the applicable benchmarks and rates stipulated
share-based payment transaction.
years.
that it becomes probable that sufficient taxable profits
by the government for the benefit of its employees. The
deferred tax asset is reduced to the extent that it is no
will be available.
social insurance and housing fund contributions are
(c) Annuity plan
recognised as part of the cost of assets or charged to
profit or loss on an accrual basis. Except for the above
contributions, the Bank has no other obligations in this
respect.
At the balance sheet date, current tax assets and liabilities are offset if the Bank has a legally enforceable right
At the balance sheet date, deferred tax assets and liabil-
The Bank provides an annuity plan to the eligible
to set them off and also intends either to settle on a net
ities are offset if all the following conditions are met:
employees. The Bank makes annuity contribution in
basis or to realise the asset and settle the liability simul-
proportion to its employees’ gross salaries, which are
taneously.
the taxable entity has a legally enforceable right to
offset current tax liabilities and assets, and
expensed in profit or loss when the contributions are
(b) Share-based payments
made.
Deferred tax assets and liabilities arise from deductible
they relate to income taxes levied by the same tax
and taxable temporary differences respectively, being
Share-based payment transactions in the Bank are equi-
authority on either:
48
49
Entrusted lending is the business where the Bank enters
the duration and the effective interest rate. Interest
the effective interest rate. If the commitment expires
into entrusted loan agreements with customers, where-
income includes the amortisation of any discount or
without the Bank making a loan, the fee is recognised as
different taxable entities which either to intend to
by the customers provide funding (entrusted funds) to
premium or differences between the initial carrying
revenue on expiry.
settle the current tax liabilities and assets on a net
the Bank, and the Bank grants loans to third parties
amount of an interest-bearing instrument and its
basis, or to realise the assets and settle the liabilities
(entrusted loans) at the instruction of the customers. As
amount at maturity calculated on an effective interest
simultaneously, in each future period in which signifi-
the Bank does not assume the risks and rewards of the
rate basis.
cant amounts of deferred tax liabilities or assets are
entrusted loans and the corresponding entrusted funds,
expected to be settled or recovered.
entrusted loans and funds are recorded as off-balance
The effective interest method is a method of calculating
non-monetary assets from the government to the Bank
sheet items at their principal amounts and no impair-
the amortised cost of financial assets and liabilities and
at no consideration except for any capital contribution
(11) Provisions and contingent liabilities
ment assessments are made for these entrusted loans.
of allocating the interest income and interest expense
from the government as a shareholder of the Bank.
over the relevant period. The effective interest rate is
Special funds such as investment grants allocated by
A provision is recognised for an obligation related to a
Wealth management business refers to agreements
the rate that exactly discounts estimated future cash
the government, if clearly defined in official documents
contingency if the Bank has a present obligation that
between the Bank and its customers to raise funds from
payments or receipts through the expected life of the
as part of “capital reserve” are dealt with as capital
can be estimated reliably, and it is probable that an
them for investment in the assets of the Bank or third
financial instrument, or, when appropriate, a shorter
contributions, and not regarded as government grants.
outflow of economic benefits will be required to settle
parties. In this business, the Bank performs its manage-
period, to the net carrying amount of the financial
the obligation. Where the effect of the time value of
ment duties and collects corresponding fees in accord-
instrument. When calculating the effective interest rate,
A government grant is recognised when there is reason-
money is material, provisions are determined by
ance with the relevant agreements. As the Bank does
the Bank estimates cash flows considering all the
able assurance that the grant will be received and that
discounting the expected future cash flows.
not assume the risks and rewards of the funds and
contractual terms of the financial instrument (for exam-
the Bank will comply with the conditions associated with
investments of the wealth management business, the
ple, prepayment, call and similar options) but does not
the grant.
In terms of a possible obligation resulting from a past
corrensponding funds and investments are recorded as
consider future credit losses. The calculation includes all
transaction or event, whose existence will only be
off-balance sheet items.
fees and points paid or received between parties to the
If a government grant is in the form of a transfer of a
confirmed by the occurrence or non-occurrence of
contract that are an integral part of the effective inter-
monetary asset, it is measured at the amount that is
uncertain future events or a present obligation resulting
est rate, transaction costs and all other premiums or
received or receivable. If a government grant is in the
discounts.
form of a transfer of a non-monetary asset, it is meas-
the same taxable entity; or
(13) Revenue recognition
from a past transaction or event, where it is not probable that the settlement of the above obligation will
Revenue is the gross inflow of economic benefits in the
cause an outflow of economic benefits, or the amount of
periods arising in the course of the Bank’s ordinary
the outflow can not be estimated reliably, the possible
activities when the inflows result in increase in share-
or present obligation is disclosed as a contingent liabili-
holders’ equity, other than increases relating to contri-
ty.
butions from shareholders. Revenue is recognised in
profit or loss when it is probable that the economic
(12) Fiduciary activities
benefits will flow to the Bank, the revenue and costs can
be measured reliably and the following respective conditions are met:
The Bank acts in a fiduciary capacity as a custodian,
trustee or an agent for its customers. Assets held by the
(a) Interest income
Bank and the related undertakings to return such assets
to customers are excluded from the financial statements as the risks and rewards of the assets reside with
Interest income arising from the use by others of entity
the customers.
assets is recognised in the income statement based on
50
(14) Government grants
Government grants are transfers of monetary assets or
ured at its fair value.
Interest on the impaired financial assets is calculated
and recognised using the rate of interest used to
A government grant related to an asset is recognised
discount future cash flows for the purpose of measuring
initially as deferred income and amortised to profit or
the related impairment loss.
loss on a straight-line basis over the useful life of the
asset. A grant that compensates the Bank for expenses
(b) Fee and commission income
to be incurred in the subsequent periods is recognised
initially as deferred income and recognised in profit or
Fee and commission income is recognised in the income
loss in the same periods in which the expenses are
statement when the corresponding service is provided.
recognised. A grant that compensates the Bank for
expenses incurred is recognised in profit or loss immedi-
Origination or commitment fees received by the Bank
ately.
which result in the creation or acquisition of a financial
asset are deferred and recognised as an adjustment to
51
(15) Profit distributions to owners
(j) key management personnel of the Bank’s parent and
actual transaction price for such transactions for
historical loss experience for assets with credit risk
close family members of such individuals
segment reporting, and segment accounting policies are
characteristics similar to the loans and advances.
Distributions of profit proposed in the profit appropria-
(k) other enterprises that are controlled or jointly
consistent with those for the Bank’s financial statement.
Historical loss experience is adjusted on the basis of the
tion plan to be authorised by the Board of Directors and
controlled by principal individual investors or key man-
declared after the balance sheet date are not recog-
agement personnel of the Bank, or close family mem-
nised as a liability at the balance sheet date but
bers of such individuals, and
disclosed in the notes separately.
(l) annuity plan of the Bank for the benefit of employ-
relevant observable data that reflect current economic
conditions. Management reviews the methodology and
(18) Significant accounting estimates and
judgments
assumptions used in estimating future cash flows
periodically to reduce any difference between estimated
and actual losses.
ees.
The preparation of financial statements requires man-
(16) Related parties
(17) Segment reporting
If a party has the power to control, jointly control or
exercise significant influence over another party, or vice
Reportable segments are identified based on operating
versa, or where two or more parties are subject to
segments which are determined based on the structure
common control or joint control from another party,
of the Bank’s internal organisation, management
they are considered to be related parties. Related
requirements and internal reporting system. An operat-
parties may be individuals or enterprises. Enterprises
ing segment is a component of the Bank that engages in
with which the Bank is under common control only from
business activities from which it may earn revenues and
the State and that have no other related-party relation-
incur expenses, whose financial performance are regu-
ships are not regarded as related parties of the Bank.
larly reviewed by the Bank’s management to make
Related parties of the Bank include, but are not limited
decisions about recources to be allocated to the
to:
segment and assess its performance, and for which
financial information regarding financial position, finan-
(a) the Bank’s parent
cial performance and cash flows is available.
(b) the Bank’s subsidiaries
(c) enterprises that are controlled by the Bank’s parent
(d) investors that have joint control or exercise significant influence over the Bank
(e) enterprises or individuals if a party has control or
agement to make estimates and assumptions that affect
amounts of assets, liabilities, income and expenses.
The fair values for financial instruments that lack an
Actual results may differ from these estimates.
active market to provide quoted prices are established
Estimates and underlying assumptions are reviewed on
using valuation techniques. These techniques include
an ongoing basis. Revisions to accounting estimates are
using recent arm’s-length market transactions between
recognised in the period in which the estimate is revised
knowledgeable, willing parties; reference to the current
and in any future periods affected. Note 9(b) and Note
fair value of another instrument that is substantially the
9(d) contain information about the assumpations and
same; discounted cash flow analysis; and option pricing
their risk factors relating to share-based payments and
models. The Bank has established a process to ensure
termination benefits. Other key sources of estimation
that valuation techniques are constructed by qualified
uncertainty are as follows:
personnel and are validated and reviewed by independent personnel. Valuation techniques are certified before
outputs reflect actual market conditions. Valuation
models established by the Bank make the maximum use
Two or more operating segments may be aggregated
periodically to assess whether impairment losses exist
of market inputs and rely as little as possible on
into a single operating segment if the segments have
and if they exist, an impairment loss is recognised.
Bank-specific information. However, it should be noted
same or similar economic characteristics and are similar
Objective evidence for impairment includes observable
that some inputs, such as credit and counterparty risk,
in respect of:
data indicating that there is a measurable decrease in
and risk correlations, require management estimates.
the estimated future cash flows identified with an
Management estimates and assumptions are reviewed
periodically and are adjusted if necessary.
the Bank
the nature of each products and services
(f) joint ventures of the Bank, including subsidiaries of
individual loan. It also includes observable data indicat-
the nature of production processes
joint ventures
ing adverse changes in the repayment status of borrow-
the type or class of customers for the products and
ers or issuers in the assets portfolio or national or local
services
associates
the methods used to distribute the products or
(h) principal individual investors and close family mem-
provide the services
bers of such individuals
the nature of the regulatory environment.
(i) key management personnel of the Bank and close
family members of such individuals
Inter-segment revenues are measured on the basis of
52
implementation and are calibrated to ensure that
(a) Impairment losses of loans and advances
The Bank reviews the portfolios of loans and advances
joint control over both the enterprises or individuals and
(g) associates of the Bank, including subsidiaries of
(b) Fair value of financial instruments
the application of accounting policies and the reported
(c) Income tax
economic conditions that correlate with defaults on the
assets in the portfolio. The impairment loss for a loan
Determining income tax provisions involves judgement
that is individually assessed for impairment is the
on the future tax treatment of certain transactions. The
decrease in the estimated discounted future cash flow
Bank carefully evaluates the tax implications of transac-
of that asset. When loans and advances are collectively
tions and sets up tax provisions accordingly. The tax
assessed for impairment, the estimate is based on
treatment of such transactions is reconsidered periodi-
53
05 Cash on hand and deposits
with central bank
04 Taxation
cally to take into account all changes in tax legislation.
(e) Depreciation and amortization of assets
The major types of taxes applicable to the Bank and the
Deferred tax assets are recognised for tax losses not yet
such as fixed assets, intangible assets
tax rates are as follows:
tax assets can only be recognised to the extent that it is
As described in Note 3(5) and 3(7), fixed assets and
(1) Business tax
probable that future taxable profits will be available
intangible assets are depreciated and amortised over
against which the deductible temporary differences can
their useful lives after taking into account residual
be utilised, management’s judgement is required to
value. The useful lives of the assets are regularly
assess the probability of future taxable profits. Manage-
reviewed to determine the depreciation and amortisa-
ment’s assessment is constantly reviewed and addition-
tion costs charged in each reporting period. The useful
al deferred tax assets are recognised if it becomes prob-
lives of the assets are determined based on historical
able that future taxable profits will allow the deferred
experiences of similar assets and estimated technical
tax assets to be utilized.
changes. If there have been significant changes in the
Note
used and deductible temporary differences. As deferred
2013
2012
217,035,028
275,527,540
(1 )
15,542,835,103
15,638,323,487
(2)
11,125,924,116
14,723,671,393
26,885,794,247
30,637,522,420
Cash on hand
factors used to determine the depreciation or amortisation, the rate of depreciation or amortisation is revised
(d) Impairment of fixed assets and intangible assets
prospectively.
Statutory deposit reserves
with central bank
Business tax is charged at 5% on taxable income (2012:
Surplus deposit reserves
5%).
with central bank
(2) Income tax
Total
The statutory income tax rate applicable to the Bank is
25%. The applicable income tax rate for the year is the
(1) The Bank places statutory deposit reserves with the
statutory rate (2012: 25%).
PBOC in accordance with the Regulation of the PRC on
the Administration of Foreign-funded Banks (Adminis-
(3) Taxes payable
As described in Note 3(8)(b), fixed assets and intangible
trative Regulation) and relevant regulations. The statu2013
2012
112,346,356
59,239,334
42,428,853
85,827,782
53,675,185
41,007,134
tory deposit reserves are not available for use in the
Bank’s daily business. As at the balance sheet date, the
assets are reviewed at each balance sheet date to determine whether the carrying amount exceeds the recover-
Income tax
able amount of the assets. If any such indication exists,
Business taxes and surcharges
Withholding taxes
related assets are regarded as impaired and impairment
statutory deposit reserve rates applicable to the Bank
were as follows:
2013
losses recognised accordingly.
To tal
214,014,543
2012
180,510,101
Renminbi deposits
The recoverable amount of an asset (asset group) is the
Foreign currency deposits
greater of its fair value less costs to sell and its present
18 %
18 %
5%
5%
value of the expected future cash flows. Since a market
price for the asset (or the asset group) cannot be
(2) The surplus deposit reserves are maintained with
obtained reliably, the fair value of the asset cannot be
the PBOC mainly for settlement purposes.
estimated reliably. In assessing value in use, significant
judgements are exercised over the asset’s production,
selling price, related operating expenses and discount
rate to calculate the present value. All relevant materials which can be obtained are used to estimate the
recoverable amount, including an estimation of the
production, selling price and related operating expenses
based on reasonable and supportable assumptions.
54
55
06 Deposits with inter-banks
2013
09 Derivatives financial
instruments
08 Trading financial assets
2012
2013
Bond investments held for trading
- in Mainland China
1,140,335,808
1,728,623,830
- outside Mainland China
6,442,308,143
11,006,328,825
3,266,961,398
2012
2013
3,512,945,036
Notional
amounts
The bonds investments held for trading are issued by
the following institutions and stated at fair value
Subtotal
7,582,643,951
Fair Value
2012
Notional
amounts
Fair Value
Total
Assets
Liabilities
Total
Assets
Liabilities
135,049,948,534
956,074,626
931,897,543
139,697,972,546
456,618,654
421,765,687
4,015,236,292
148,593
1,450,812
2,527,647,336
506,401
214,982
139,065,184,826
956,223,219
933,348,355
142,225,619,882
457,125,055
421,980,669
4,832,778,514
15,828,793
7,933,033
11,558,446,498
26,068,871
24,426,965
247,342,477,351
1,834,152,533
1,881,079,714
201,399,941,349
1,194,899,631
972,184,204
252,175,255,865
1,849,981,326
1,889,012,747
212, 958,387,847
1,220,968,502
996,611,169
1,307,427,374
17,553,683
17,553,683
907,133,166
9,608,513
9,608,513
743,907,668
4,896,365
4,896,365
235,458,754
2,353,696
2,353,696
2,051,335,042
22,450,048
22,450,048
1,142,591,920
11,962,209
11,962,209
393, 291,775,733
2,828,654,593
2,844,811,150
356,326,599,649
1,690,055,766
1,430,554,047
12,734,952,655
Interest rate derivatives：
Deposits with non-bank financial institutions
- in Mainland China
2013
68,171,965
51,115,871
-
16,619
68,171,965
51,132,490
Subtotal
2012
Interest rate option
Policy banks
2,494,194,090
1,098,233,820
459,936,228
40,977,976
outside mainland China
252,920,110
290,533,340
Enterprises in mainland China
59,910,970
79,821,200
-
2,003,378,700
The MOF
Inter-banks and non-bank institutions
Total
7,650,815,916
Interest rate swap
12,786,085,145
As at 31 December 2013, management considered that
The PBOC
no impairment provision of deposits with inter-banks
was necessary (2012: nil).
Total
Currency derivatives：
3,266,961,398
Currency option
Forward
3,512,945,036
Other derivatives：
Commodity swap
Equity swap
07 Placements with inter-banks
2013
2012
Total
- in Mainland China
19,858,944,162
12,063,459,320
3,663,076,625
6,986,228,949
23,522,020,787
19,049,688,269
Subtotal
The notional amounts of the derivatives indicate the volume of transactions outstanding at the balance sheet date;
they do not represent the amounts at risk.
Placements with non-bank financial institutions
- in Mainland China
Total
7,185,490,000
4,262,000,000
30,707,510,787
23,311,688,269
56
57
10 Loans and advances to
customers
(1) Analysed by nature
(2) Analysed by industry sector
Note
2013
2013
2012
Note
Corporate loans and advances
- loans
- discounted bills
36,474,959,601
32,078,445,864
7,233,387,443
19,254,643,950
Personal loans and advances
- residential mortgages
15,435,894,174
10,543,940,346
- personal consumer loans
1,330,960,452
1,074,259,688
- credit cards loans
1,580,481,382
500,395,636
62,055,683,052
63,451,685,484
Gross loans and advances
Less: Allowances for impairment losses
10(6)
(667,754,656)
(501,175,803)
Manufacturing
Amount
61,387,928,396
28%
18,218,312,858
29%
Wholesale and retail trade
7,956,768,198
13%
6,248,740,458
10%
Leasing and commercial services
3,959,409,971
6%
3,512,607,045
5%
Transportation, storage and postal services
3,065,219,941
5%
1,364,332,257
2%
Telecommunications, IT services and software
Mining
1,479,145,952
995,234,050
2%
2%
320,930,018
952,825,000
1%
2%
Hotel and restaurant
795,078,689
1%
701,306,506
1%
Real estate
135,875,278
*0%
137,254,723
*0%
Fisheries and agriculture
Construction
96,704,645
15,871,566
*0%
*0%
94,289,114
404,712,940
*0%
1%
-
-
16,631,433
*0%
483,163,128
1%
106,503,512
*0%
Subtotal
36,474,959,601
58%
32,078,445,864
51%
Discounted bills
Personal loans and advances
7,233,387,443
18,347,336,008
12%
30%
19,254,643,950
12,118,595,670
30%
19%
62,055,683,052
100%
63,451,685,484
100%
Production and supply of electricity, gas and water
62,950,509,681
10(6)
Net loans and advances to customer
(667,754,656)
s61,387,928,396
* The percentages of th ese items are less than 1%.
58
Amount
17,492,488,183
Others
Net loans and advances to customers
2012
59
(501,175,803)
62,950,509,681
customers
(3) Analysed by geographical sector
(5) Overdue loans analysed by overdue period
2013
Note
Yangtze River Delta
Amount
2013
2012
Amount
Within
three months
(inclusive)
Between
three months
and one year
(inclusive)
Between
one year and
three months
(inclusive)
Over
three years
Total
34,508,693,193
56%
34,827,058,106
55%
13,876,184,228
22%
12,355,518,733
19%
11,164,614,499
18%
13,655,069,590
21%
Unsecured loans
210,085,416
33,707,258
4,066,540
661,218
248,520,432
2,071,002,611
435,188,521
3%
1%
2,271,763,844
342,275,211
4%
1%
Guaranteed loans
Secured loans
3,925,000
92,689,699
41,997,095
1,910,344
38,009,531
67,221,614
24,716,259
106,285,878
108,647,885
268,107,535
90,888,153
1,910,344
67,221,614
106,285,878
266,305,989
1,801,546
-
-
-
1,801,546
306,700,115
77,614,697
109,297,685
131,663,355
625,275,852
Bohai Rim
Pearl River Delta
Middle and western region
Northeastern region
- by tangible asssets other
62,055,683,052
100%
63,451,685,484
100%
than monetary assets
-by monetary assets
10(6)
(667,754,656)
(501,175,803)
Total
61,387,928,396
62,950,509,681
2012
(4) Analysed by security type
Note
2013
2012
Unsecured loans
22,929,128,346
30,802,918,123
Guaranteed loans
Secured loans
- by tangible assets other than monetary assets
- by monetary assets
13,418,533,793
25,708,020,913
16,950,022,186
8,757,998,727
14,207,343,972
18,441,423,389
11,966,617,126
6,474,806,263
62,055,683,052
63,451,685,484
(667,754,656)
(501,175,803)
61,387,928,396
62,950,509,681
Unsecured loans
Guaranteed loans
Secured loans
10(6)
Between
three months
and one year
(inclusive)
Between
one year and
three months
(inclusive)
25,866,444
2,422,809
1,756,529
Over
three years
320,995
Total
30,366,777
10,141,582
25,814,411
1,644,856
28,780,910
66,381,759
39,941,609
46,291,731
34,181,193
117,000,000
237,414,533
39,941,609
46,291,731
34,181,193
117,000,000
237,414,533
75,949,635
74,528,951
37,582,578
146,101,905
334,163,069
- by tangible asssets other
than monetary assets
Within
three months
(inclusive)
Total
Overdue loans represent loans and advances to customers, of which the whole or part of the principal or interest was
overdue for more than one day.
60
61
customers
11 Available-for-sale financial
assets
(6) Movements of allowances for impairment losses
2013
2012
17,228,779,130
16,135,172,130
2013
As at 1 January
Charge for the year
Individual
assessment
Total
258,165,446
243,010,357
501,175,803
147,710,273
20,659,357
168,369,630
-
(16,476)
(16,476)
(167,853)
(1,774,301)
263,485,385
667,754,656
Effect of discounting
Exchange differences
As at 31 December
Bond investments
Collective
assessment
(1,606,448)
404,269,271
The available-for-sale bond investments are issued by the following institutions and stated at fair value:
2013
2012
The MOF
9,059,992,400
727,219,430
The PBOC
8,168,786,730
15,407,952,700
Total
17,228,779,130
16,135,172,130
2012
As at 1 January
Individual
assessment
Total
339,595,219
173,284,147
512,879,366
(Reversal) / charge for the year
(82,118,707)
75,661,605
(6,457,102)
-
(5,392,347)
(215,143)
(5,392,347)
(215,143)
688,934
(327,905)
Amounts written-off
Effect of discounting
As at 31 December
As at 31 December 2013, management considered that no impairment provision of available-for-sale financial assets
Collective
assessment
258,165,446
243,010,357
was necessary (2012: nil).
361,029
501,175,803
As at 31 December 2013, the Bank’s loan provision ratio was 1.08% (2012: 0.79%), the provision coverage ratio was
230.86% (2012: 184.69%).
Loan provision ratio represents ratio of loan loss provision over gross loans and advances to customers at the balance
sheet date. Provision coverage ratio represents ratio of loan loss provision over non-performing loans. According to
the five-tier risk classification in CBRC’s Notice on Distributing Guidelines on Loan Risk classification (Yin Jian Fa
[2007] No. 54), non-performing loans represent loans and advances classified as substandard, doubtful and loss.
(7 ) Restructured loans and advances to customers
Restructured loans and advances to customers
62
2013
2012
117,076,000
131,854,773
63
12 Fixed Assets
13 Intangible assets
Office & other
equipment
Motor vehicles
Cost
Cost
As at 1 January 2013
Software
Total
168,767,408
360,188,484
3,995,159
364,183,643
Additions
17,954,927
1,354,324
19,309,251
Additions
7,817,033
Disposals
(14,302,749)
(15,154,077)
Disposals
(1,885,015)
As at 31 December 2013
363,840,662
(851,328)
4,498,155
368,338,817
(286,454,868)
(3,593,211)
(290,048,079)
Charge for the year
Written back on disposal
(30,629,732)
14,295,441
(424,490)
851,328
(31,054,222)
15,146,769
(302,789,159)
(3,166,373)
(305,955,532)
(88,206,405)
Charge for the year
(17,499,721)
Written back on disposal
362,054
(105,344,072)
---------------------
Carrying amounts
Carrying amount
174,699,426
---------------------
Less: Accumulated amortisation
Less: Accumulated depreciation
61,051,503
73,733,616
1,331,782
401,948
62,383,285
69,355,354
80,561,003
74,135,564
As at 31 December 2013, management considered that no impairment provision of intangible assets was necessary
As at 31 December 2013, management considered that no impairment provision of fixed assets was necessary
(2012: nil).
(2012: nil).
64
65
14 Deferred tax assets
Deferred tax assets / (liabilities)
As at 1
January 2013
Fair value adjustments for derivatives
Fair value adjustments for
available-for-sale financial assets
Current year
increase / decrease
charged to
profit or loss
(64,875,431)
Current year
increase / decrease
recognised
in equity
68,916,476
-
Note
2013
2012
1,500,940,390
231,756,983
Deposits from inter-banks
Deferred expenses
210,603,390
146,490,760
- in Mainland China
Leasehold improvements
146,149,304
158,282,164
Refundable deposits
94,497,451
91,804,819
189,103
2,555,633
-
213,354
1,952,379,638
631,103,713
(27,341,850)
(28,187,636)
Suspensed settlement
As at 31
December 2013
4,041,045
Receivables
Others
(2,927,082)
-
40,757,307
37,830,225
Fair value adjustments for trading
financial assets
Adjustments for accrued expenses
16 Deposits from inter-banks and
non-bank financial institutions
15 Other assets
16,342
148,700,217
845,103
6,459,009
-
861,445
155,159,226
Others
14,371,076
1,155,496
110,656
15,637,228
Total
95,285,122
77,376,084
40,867,963
213,529,169
Subtotal
Less : Provisions for
impairment losses
(1)
Subtotal
1,925, 037,788
2012
113,948,602
160,902,318
12,297,468,094
6,109,029,283
12,411,416,696
6,269,931,601
894,667,156
3,165,698,244
7,295,055,042
2,872,952,825
8,189,722,198
6,038,651,069
20,601,138,894
12,308,582,670
Deposits from non - bank
financial institutions
- in Mainland China
Subtotal
Total
2013
602,916,077
Total
(1) Movements of allowances for other assets
At the balance sheet dates, the deferred tax assets and liabilities on the balance sheet, after offsetting each other,
As at 1 January
were as follows:
As at 31 December
Deferred tax assets
Deferred tax liabilities
2013
2012
213,529,169
163,087,638
-
Total
213,529,169
2013
2012
28,187,636
28,256,698
(845,786)
27,341,850
(69,062)
28,187,636
17 Borrowings from inter-banks
(67,802,516)
2012
10,492,510,490
6,751,057,744
Borrowings from inter-banks
95,285,122
66
2013
67
18 Financial assets sold under
repurchase agreements
20 Employee benefits payable
2013
2012
The PBOC notes
-
7,430,000,000
Government bonds
-
490,000,000
Total
-
7,920,000,000
As at 31 December 2012, the counterparties of the above financial assets sold under repurchase agreements were
the PBOC and domestic banks in Mainland China.
Note
Salaries, bonuses and allowances
Social insurances
Medical insurance premium
Pension insurance premium
Annuity premium
Unemployment insurance premium
Work-related injury insurance premium
Maternity insurance premium
Housing fund
Others
Total
19 Deposits from customers
(1)
Balance at the
begining
of the year
Accrued
during
the year
Paid
during
the year
Balance
at the end
of the year
207,695,315
1,109,167,665
(1,098,889,693)
217,973,287
15,403,381
158,695,002
(154,407,866)
19,690,517
3,418,432
42,281,096
(40,121,190)
5,578,338
8,054,260
81,856,655
(79,526,677)
10,384,238
3,041,657
23,369,149
(24,077,499)
2,333,307
551,384
5,971,974
(5,832,443)
690,915
124,991
2,018,213
(1,813,898)
329,306
212,657
3,197,915
(3,036,159)
374,413
4,542,256
33,832,722
(35,562,049)
2,812,929
610,160
78,374,936
(78,340,899)
644,197
228,251,112
1,380,070,325
(1,367,200,507)
241,120,930
(1) Pursuant to the relevant laws and regulations of the PRC, employees of the Bank participate in the social insurance
system established and managed by government organisations. The Bank makes social insurance contributions to the
2013
2012
local social insurance entities at the applicable base salary and rates stipulated by the government for the benefit of
its employees.
Current deposits
- corporate customers
- personal customers
49,236,320,228
4,999,357,184
56,480,143,472
4,295,546,488
Subtotal of current deposits
54,235,677,412
60,775,689,960
Time deposits (including call deposits)
- corporate customers
- personal customers
33,243,212,636
8,840,279,854
33,648,763,402
9,085,025,373
42,083,492,490
42,733,788,775
304,933,731
56,618,645
96,624,103,633
103,566,097,380
Subtotal of time deposits
Other Deposits
- inward and outward remittances
Total
68
Besides, the Bank provides an annuity plan to the eligible employees. The Bank makes annuity contributions in proportion to its employees’ gross salaries.
69
21 Other liabilities
23 Capital reserve
2013
Cash collaterals
Suspensed settlement
Accrued expenses
Deferred income
Others
2013
2012
7,374,698,368
2,047,180,081
251 ,593,516
54,941 ,612
162,720,180
5,692,041,839
2,942,486,128
208,305,475
25,900,425
284,488,570
Balance
at the
beginning
of the year
9,891,133,757
9,153,222,437
Fair value
adjustments
Transfer
to profit
or loss
Balance at
the end of
the year
(169,198,731)
6,169,500
(151,320,901)
Other capital reserve
- Available-for-sale financial assets
Total
Changes
during
the year
11,708,330
-
33,400,541
2,192,097
-
-
35,592,638
- Available-for-sale financial assets
(2,927,082)
40,757,307
-
-
37,830,225
- Equity-settled share-based payments
(8,457,699)
110,656
-
-
(8,347,043)
Total
33,724,090
6,169,500
(86,245,081)
- Equity-settled share-based payments
- Deferred tax
43,060,060
(169,198,731)
22 Paid-in capital
As at 31 December, the Bank’s registered capital and paid-in capital are as follows:
2013 and 2012
Registered capital and paid-in capital
Citibank
Amount
%
3,970,000,000
100%
Capital contributions in foreign currency were translated into Renminbi at the exchange rate at the date of the
contributions received as quoted by the PBOC.
Certified Public Accountants have verified the above paid-in capital and issued related capital verification reports.
70
24 Surplus reserve
The statutory surplus reserve is as follows:
2013
Balance at the beginning of the year
Profit appropriation ( N ote 26(1 ))
605,631,273
96,412,040
Balance at the end of the year
702,043,313
71
27 Net interest income
25 General reserve
Appropriation to general reserve in accordance with
2013
201 2
the regulations issued by the MOF
2013
Balance at the beginning of the year
1,305,394,495
Profit appropriation (Note 26)
171,295,790
Balance at the end of the year
1,476,690,285
According to the Notice on Administrative Measures on Accrual of Provisions by Financial Enterprises (Cai Jin [2012]
No.20) issued by the MOF on 30 March 2012, a financial enterprise shall appropriate from net profits an amount of
not less than 1.5% of its risk-bearing assets at the year end as general reserve. Where the general provision ratio
cannot reach 1.5% immediately, it is acceptable to reach the ratio gradually over a period of not more than five years
in principle. The Notice came into force on 1 July 2012. The Bank appropriates the general reserve in according with
the requirements of Cai Jin [2012] No.20.
As at 31 December 2013, the Bank appropriated an amount of Renminbi 1,476,690,285 as general reserve according
to the above requirements (2012: Renminbi 1,305,394,495).
Interest income :
corporate loans and advances
discounted bills
personal loans and advances
Placements with inter -banks
Deposits with central bank
Deposits with inter -banks
Others
Total interest income
Include : interest income from impaired
financial assets
2013
Interest expenses :
Deposits from inter -banks and non -bank
financial institutions
Borrowings from inter -banks
Financial assets sold under repurchase agreements
(1)
96,412,040
137,321,296
Appropriations to general reserve
25
171,295,790
486,953,322
267,707,830
624,274,618
4,408,561,165
215,143
(1,331,619,085)
(241,946,324)
(103,649,690)
(44,355,079 )
(221,540,695)
(46,923,105)
(118,270,912)
Total interest expenses
(1,790,691,226)
(1,718,353,797)
Net interest income
2,602,809,464
2,690,207,368
(1) Appropriations to surplus reserve
The Bank appropriated an amount of Renminbi 96,412,040, representing 10% of profit after tax for the year as surplus
reserve in accordance with relevant regulations and its articles (2012: Renminbi 137,321,296).
72
4,393,500,690
(1,400, 740,133 )
2012
Appropriations to surplus reserve
3,356,128,938
1,788,421,5 07
1,019,309,699
548,397,732
702,846,294
292,640,768
46,726,232
10,218,933
16,476
26 Profit appropriation
Note
3,048,313,5 79
1,507,553,348
697,351,582
843,408,651
1,034,107,517
283,897,507
21, 252,029
5,930,058
73
28 Net fee and commission income
29 Investment income
2013
201 2
Fee and commission income:
Commission on trust and custodian activities
359,549,539
268,419,757
Fees for agency services
101,610,718
78,703,867
Credit commitment fees
71,723,520
95,819,314
Settlement and clearance fees
53,340,966
53,086,934
Trade finance and guarantee services fees
Bank card fees
52,557,332
38,878,308
53,567,629
10,296,860
Others
36,218,968
30,861,602
Total fee and commission income
713,879,351
590,755,963
(47,209,234)
(43,934,213)
(31,280,223)
(42,170,015)
(4,952,417)
(156,580)
(661,733)
(370,188)
(11,856,176)
(6,702,334)
Total fee and commission expenses
(95,959,783)
(93,333,330)
617,919,568
2013
201 2
Available -for-sale financial assets
Derivatives
530,627,361
159,900,969
46,341,319
574,826,505
119,554,060
214,500,622
Total
736,869,649
908,881,187
2013
201 2
(263,170,308)
34,464,171
(3,380,412)
13,411
(266,550,720)
34,477,582
Fee and commission expenses:
Inter-bank transaction fees
Brokerage fees
Bank card
Trust and custodian fees
Others
497,422,633
30 (Losses) / gains from changes
in fair value
Derivatives
Total
74
75
31 General and administrative
expenses
33 Income tax expense
Staff costs
- Salaries, bonuses and allowances , etc.
- Staff welfare
Service fees
Rental and property maintenance fees
Business promotion expenses
IT equipment maintenance fees
Depreciation and amortisation
Meetings and office expenses
Travelling expenses
Union fees
Utilities
Business entertainment expenses
Stamp duties
Others
Total
2013
201 2
1,063, 816 ,546
270,902,661
1,027,220,288
230,384,915
1,334,719,207
1,257,605,203
372,765,434
297,574,342
147,005,837
121,776,443
82,661,395
50,765,471
23,929,158
20,606,494
15,930,783
9,771,537
7,339,166
230,489,812
396,783,683
277,734,483
147,190,441
59,277,436
83,867,266
49,029,469
30,617,447
18,152,699
14,497,912
10,285,845
6,418,899
196,267,078
2,715,335,079
2,547,727,861
(a) Income tax expense for the year represents
2013
201 2
Current tax expense for the year
Tax filling differences
Changes in deferred tax assets / liabilities
343,296,758
883,836
(77,376,084)
487,743,642
(4,699,211)
(28,276,813)
Total
266,804,510
454,767,618
(b) Reconciliation between income tax expense and accounting profit is as follows:
2013
201 2
1,230,924,906
1,827,980,584
Expected income tax expense at a tax rate of 25%
Tax effect of non -deductible expenses
Tax effect of non -taxable income
Tax filling differences
307,731,227
5,261,669
(47,072,222)
883,836
456,995,146
13,266,252
(10,794,569)
(4,699,211)
Income tax expense
266,804,510
454,767,618
Profit before taxation
32 Impairment losses charge /
(reversal)
Impairment losses charge / (reversal) for
loans and advances to customers
76
2013
201 2
168,369,630
(6,457,102)
77
35 Supplement to cash flow
statement
34 Other comprehensive income
2013
(Losses) / gains arising from available -for-sale
financial assets
Add / (less): Tax expense
Reclassification adjustments for
amounts transferred to profit or loss
Sub total
201 2
(169,198,731)
40,757,307
26,749,300
(6,946,788)
6,169,500
1,037,850
(122,271,924)
20,840,362
Changes in fair value of equity -settled
share-based payments
Add / ( less): T ax expense
2,192,09 7
110,65 6
3,387,924
(861,609)
Subtotal
2,302,753
2,526,315
Total
(119,969,171)
23,366,677
(1) Reconciliation of net profit to cash flows from operating activities:
Net profit
Add : Impairment losses charge / (reversal)
for loans and advances to customers
Depreciation of fixed assets
Amortisation of intangible assets
Amortisation of leasehold improvements
201 2
964,120,396
1,373,212,966
168,369,630
31,054,222
17,499,721
(6,457,102)
35,151,845
17,492,435
34,107,452
31,222,986
8,243,040
(549,336,732)
266,550,720
(77,376,084)
(16,476)
516,254,958
(4,499,201,633)
3,172,191
(571,723,577)
(34,477,582)
(28,276,813)
(215,143)
12,524,209
(3,976,724,878)
(1,841,636,356)
24,190,528,640
(4,961,367,142)
21,045,430,177
Losses on disposal of fixed assets, intangible assets
and other long -term assets
Investment income
Losses / ( gains) on changes in fair value
Increase in deferred tax assets
Interest income from impaired financial assets
Unrealised foreign exchange losses
Increase in operating receivables
(D ecrease) / increase in operating
payables
Net cash (outflow ) / inflow from
operating activities
78
2013
79
35 Supplement to cash flow
statement
36 Related party relationships
and transactions
(2) Change in cash and cash equivalents:
(1) Information on the parent of the Bank is listed as follows:
2013
201 2
Company name
Cash and cash equivalents at the end of the year
Less : C ash and cash equivalents at the
beginning of the year
Net (decrease) / inc rease in cash and
cash equivalents
Principal
activities
Stockholder’s
equity
Banking and
financial services
US dollar
147,557million
Registered
place
35,289,366,558
40,544,135,948
Citibank
(40,544,135,948)
(23,815,812,389)
The Bank’s ultimate controlling party is Citigroup Inc..
(5,254,769,390)
16,728,323,559
(3) Cash and cash equivalents held by the Bank are as follows:
2013
201 2
Cash on hand
Central bank deposits available on demand
Placements with inter -banks
Available -for-sale financial assets
217,035,028
11,125,924,116
7,650,815,916
14,078,000,008
1,218,800,490
998,791,000
275,527,540
14,723,671,393
12,786,085,145
12,758,851,870
-
Total
35,289,366,558
40,544,135,948
United States
Shareholding
percentage
100%
Proportion of
voting rights
100%
(a) Transactions with the parent:
Interest income
Interest expense s
Investment losses
(Losses ) / gains from changes in fair value
2013
201 2
37,757,204
(241,363,097)
16,027,519
(1,067)
(28,910,779)
(117,418,227)
48,669,226
(178,375,210)
13,392,800
(43,338,668)
298,375,694
20,549,173
153,643,483
(174,706,757)
(172,294,922)
(b) The balances of transactions with the parent at 31 December are set out as follows:
Interest receivable
Other assets
Deposits from inter -banks and
non-bank financial institutions
Borrowings from inter -banks
Interest payable
Other liabilities
80
81
2013
201 2
6,569,526,780
3,663,076,625
279,495,024
1,747,181
18,942,208
11,005,798,382
6,985,852,448
318,270,529
1,234,063
11,670,486
(12,205,915,844)
(8,054,585,181)
(340,381,722)
(52,105,399)
(181,847,596)
(4,930,645,103)
(5,793,590,239)
(266,257,406)
(28,386,037)
(150,611,940)
and transactions
(c) The notional amounts of derivative contracts with the parent at 31 December are set out as follows:
Forwards
(2) Transactions between the Bank and its key management personnel and their close family members
2013
201 2
20,506,936,203
15,441,768,950
3,352,575,453
237,809,030
4,015,236,292
622,828,508
371,953,833
10,031,131,761
1,164,168,936
2,527,647,336
453,566,583
117,729,377
Interest rate swaps
Currency options
Interest rate options
Commodity swaps
Equity swaps
Operating lease commitments
11,000,612
Remuneration of key management personnel
2013
201 2
90,636,875
85,786,752
2,614,538
1,740,757
Maximum loans and advances issued to key management personnel
and their close family members
(b) The balances of transactions with the Bank’s key management personnel and their close family members at 31 December are set out
(d) The balances of commitments with the parent at 31 December are set out as follows:
2013
(a) Transactions with the key management personnel and their close family members:
2012
as follows:
2013
201 2
1, 299,985
559,601
15,389,283
28,289,560
1,380,209
226,353
11,149,225
28,112,995
16,575,165
Credit cards loans
Employee benefits payable
(e) In addition, significant related party transactions with the Bank’s parent approved by Related Party Transaction
Control Committee and the Board of Directors during the year are set out as follows:
Related parties of the Bank include close family members of its key management personnel, key management
personnel of the Bank’s parent, close family members of key management personnel of the Bank’s parent, other
The Bank outsourced the non-Renminbi cash operation, funds and securities operation and technology related service
enterprises that are controlled or jointly controlled by its key management personnel and close family members of
to Citibank N.A. Singapore Branch. Such outsourcing services cost the Bank Renminbi 162,536,098 in general and
such individuals. The Bank’s transactions with these related parties are insignificant, thus not disclosed separately.
administrative expenses in the year 2013 (2012: Renminbi 154,457,440).
A significant related party transaction represents a single transaction conducted between the Bank and a related party
where the transaction amount is 1% or more of the total equity of the Bank, or after this transaction, the total balance
with the connected party is 5% or more of the total equity of the Bank.
(c) The balance of credit commitments with the Bank’s key management personnel and their close family members
at 31 December are set out as follows:
Credit commitments
82
83
2013
201 2
5,890,399
5,523,647
and transactions
(d) The credit commitments with the Bank’s other related personnel is set out as follows:
(3) Credit transactions between the Bank and its other related personnel
2013
201 2
4,335,439
5,793,744
2013
201 2
10,634,895
(645,291)
4,789,606
(3,307,269)
(38,096,359)
3,004,354
(376, 618,749)
8,407,292
(584,178)
4,999,198
(3,166,454)
(350,245)
(919)
2,456,708
(339,710,503)
Besides the key management personnel information listed in Note 36(2), the Bank discloses the credit transactions
between the Bank and its related personnel according to the requirement of paragraph 38 of Administrative Measures for the Related Party Transactions between Commercial Banks and their Insiders or Shareholders (Order of the
Credit commitments
CBRC (2004) No.3).
The Bank has credit commitments with 95 other related personnels.
The Bank’s related personnel include the Bank’s insiders, controlling shareholders, directors or key management
personnel of the Bank’s related legal entities or other organisations. Insiders include the Bank’s directors, senior
management personnel of the head office and branches and other personnel who have the power to decide or
participate in the extension of credit or transfer of assets by the Bank.
(4) Transactions between the Bank and other related parties
(a) Basic information of the related personnel that have mortgage transactions with the Bank
(a) Transactions with other related parties:
Name
Title
Jin Yu
Executive vice president
Cline Zhang
Vice president of Shanghai Branch
Julia Ye
Branch manager of Shanghai West Nanjing Road Sub -branch
The credit transaction information relating to the Bank’s executive vice president, Jin Yu, is disclosed in Note 36(2)
and thus not included in Note 36(3).
Interest income
Interest expenses
Investment losses
Losses from changes in fair value
(b) 65 other related personnels are involved in credit card transactions with the Bank.
The transactions and percentage between the Bank and its non-bank related parties are set out as follows:
(c) The credit balance with the Bank’s other related personnel is set out as follows:
2013
2013
201 2
902,141
1,130,561
84
2012
%
259,940,034
79,770,469
10.20%
3.13%
- Service received
- Property rented
Mortgage loans
Credit card loans
%
293,412,645
83,206,103
637,652
406,256
85
10.81%
3.06%
and transactions
(b) The balances of transactions with other related parties at 31 December are set out as follows:
Interest receivable
Other assets
Deposits from inter-banks and non-bank financial institutions
Interest payable
Other liabilities
(d) The balances of commitments with other related parties at 31 December are set out as follows:
2013
201 2
13,033
-
249,458,809
117,000,000
1,146,384
2,049,042
23,658,809
47,317,618
1,682,338
659,503
8,223,809
13,529,366
(35,826,539)
(14,503,483)
(779,758)
(532,688)
(167,403,681)
(108,536,199)
(25,162)
(16,162)
(34,477,571)
(96,824,457)
Operating lease commitments
Placement with non-bank financial institutions
Other liabilities - Service fee payables
249,458,809
23,658,809
34,477,571
%
2012
%
0.81%
117,000,000
47,317,618
22,453,856
0.50%
0.07%
0.25%
0.04%
0.34%
Forwards
Interest rate swaps
Currency options
86
2012
1,641,082,638
2,063,394,482
10,155,941
1,117,604,985
3,797,222,632
60,377,381
119,802,127
Party Transaction Control Committee and the Board of Directors are set out as follows:
Outsourcing of China Data Centre processing and management services, software application and enhancement and
technical support to Citicorp Software and Technology Services (China) Ltd.(including Citicorp Data Processing
(Shanghai) Co., Ltd. and Citicorp Management Consulting (Shanghai) Co., Ltd.), was approved in prior years. Such
outsourcing services cost the Bank Renminbi 266,964,917 in general and administrative expenses in the year 2013
(2012: Renminbi 267,872,087).
(c) The notional amounts of derivative contracts with other related parties at 31 December are set out as follows:
2013
201 2
(e) In addition, the significant related party transactions with other related parties approved by the Bank’s Related
The balance of transactions with non-bank related parties at 31 December are set out as follows:
2013
2013
87
and transactions
(e) Relationships between the Bank and other related parties under the transactions stated in 36(4)(a) to (d) above
Company name
Relationships
with the Bank
Company type
Principle activities
Software development,
back office operation
and outsourcing service,
consulting and training
Citicorp Software and
Technology Services (China) Ltd.
Group subsidiary
Limited liabilities
company (WOFE)
Hubei Jingzhou Gong ’an
Citi Lending Co., Ltd.
Group subsidiary
Limited liabilities
company (WOFE)
Dalian Wafangdian
Hubei Xian’ ning Chibi
Group subsidiary
Chongqing Beibei
CitiRealty China (BVI) Ltd.
Group subsidiary
Legal
representative
Registered
place
Registered
capital
Changes in
registered capital
for the year
Gary Li
PRC
USD 17,350 thousand
No changes
Credit business
Jie Liu
PRC
RMB 34,000 thousand
No changes
Limited liabilities
company (WOFE)
Limited liabilities
company (WOFE)
Credit business
Shilu Liu
PRC
RMB 34,000 thousand
No changes
Credit business
Sizhen Li
PRC
RMB 34,000 thousand
No changes
Credit business
Zhengquan Li
PRC
RMB 38,800 thousand
No changes
Group subsidiary
Limited liabilities
company (WOFE)
Private company
Property holding
*
British Virgin Island
USD 50 thousand
No changes
Citigroup Trade Services
(Malaysia) Sendirian Berhad
Group subsidiary
Private company
Outsourcing service
*
Malaysia
MYR 5,000 thousand
No changes
Citicorp International Limited
Group subsidiary
Private company
Banking
*
Hong Kong
USD 24,000 thousand
and HKD 200,000 thousand
No changes
Citicorp Service India Limited
Diners Club International
(Hong Kong) Ltd.
Group subsidiary
Group subsidiary
Public company
Private company
Decision Support,
Vendor Oversight
Charge card business
*
*
India
Hong Kong
Citishare Corporation
Citibank Singapore Ltd.
Group subsidiary
Group subsidiary
Private company
Private company
ATM processing
Commercial banking
*
*
United States
Singarpore
Citigroup Global Market
Asia Ltd.
Citi Ventures Shanghai
Group subsidiary
Private company
*
Hong Kong
Group subsidiary’s
Representative office
Security and invesment
banking business
Marketing and
Wei Hopeman
United States
Representative office
Citibank Taiwan Limited
representative office
Group subsidiary
of foreign enterprise
Public company
coordinating efforts
Commerical banking
Guolin Guan
Taiwan
NT$ 66,033 million
No changes
Citibank Nigeria Limited
Group subsidiary
Limited liabilities
Commerical banking
*
Nigeria
Naira 50,100 million
Increased by
Naira 1,000 million
Citibank Uganda Limited
Group subsidiary
Private company
Commerical banking
*
Uganda
Citibank Japan Ltd.
Group subsidiary
Private company
Commerical banking
*
Japan
JPY 123,100 million
No changes
Citibank Pty Ltd.
Group subsidiary
Private company
Commerical banking
*
Australia
AUD 459.80 million
No changes
Citibank Europe PLC
Group subsidiary
Public company
Commerical banking
*
Ireland
USD 10,071 thousand
No changes
Group subsidiary
INR 2,500 million
HKD 2 million
USD 1 thousand
SGD 1,527,730 thousand
HKD 320,134
thousand
N/A
UGX 43,923,900 thousand
* These related parties were registered outside Mainland China where legal representatives are not required .
88
89
No changes
No changes
No changes
No changes
No changes
No changes
No changes
and transactions
38 Segment reporting
(5) Transactions with the annuity plan
The Bank has two reportable segments, which are corpo-
Unallocated items
rate banking and personal banking segment, determined
Apart from the obligations for defined contributions to the annuity plan, no other transactions were conducted
based on the structure of its internal organisation, man-
This segment mainly includes assets, liabilities, income
between the Bank and the annuity plan during the year.
agement requirements and internal reporting system.
and expenses which cannot be attributed to directly or
Each reportable segment is a separate business unit
divided reasonably to segments.
which offers different products and services, and is managed separately because they require different technol-
(1) Segment results, assets and liabilities
ogy and marketing strategies. The financial information
37 Share-based payments
of the different segments is regularly reviewed by the
For the purposes of assessing segment performance and
Bank’s management to make decisions about resources
allocating resources between segments, the Bank’s
to be allocated to each segment and assess its perfor-
management regularly reviews the assets, liabilities,
mance.
revenue, expenses and financial performance, attributable to each reportable segment on the following bases:
Expenses recognised for the year arising from share-based payments are as follows:
Corporate banking
2013
Equity -settled share-based payments
29,703,934
201 2
25,573,119
The Bank’s share-based payment scheme is devised to reward staff for their services.
As at 31 December 2013, the outstanding number of shares in connection with share-based payments which the Bank
granted to its staff but not exercised is 323,324 (2012: 415,741). The above shares are the shares of Citigroup Inc.
Segment assets include all tangible, intangible, other
This segment provides a range of financial products and
non-current and current assets, with the exception of
services to corporations and financial institutions,
deferred tax assets and other unallocated corporate
including: corporate deposit taking activities, corporate
assets.
short-term, medium-term and long-term loans, bank
customers, deposits from inter-banks and non-bank
acceptances and bills discounted, government bonds
financial institutions, borrowings from inter-banks and
and financial bonds transactions, foreign currency secu-
other liabilities attributable to the individual segments.
Segment liabilities include deposits from
rities transactions other than stocks, letters of credit
and guarantees, corporate domestic and foreign settle-
Financial performance is operating income (including
ments, foreign exchange trade and agent services,
operating
inter-bank placements and borrowings, safe deposit box
inter-segment
services, credit investigation and advisory services.
expenses, depreciation, amortisation and impairment
income
from
external
customers
operating
income)
after
and
deducting
losses attributable to the individual segments. Inter-seg-
Personal banking
ment sales are determined with reference to prices
charged to external parties for similar orders. Non-oper-
90
This segment provides a range of financial products and
ating income and expenses and tax expenses are not
services to individual customers, including: personal
allocated to individual segments. Information regarding
deposit taking activities, personal short-term, medi-
the Bank’s reportable segments set out below includes
um-term and long-term loans, personal domestic and
the information used for assessing segment perfor-
foreign settlement, foreign exchange trade and agent
mance and allocating segment assets and liabilities by
services, insurance agent services, bank card services
the Bank’s management or not used but regularly
and safe deposit box services.
reviewd by the Bank’s management:
91
(1) Segment results, assets and liabilities (continued)
Corporate banking
1.
Operating income
Net interest income
Other income (a)
2. Operating expenses
Include: Depreciation and amortisation
Impairment losses
(charge) / reversal
2012
2013
2012
2013
2012
2013
2012
3,249,936,744
1,939,987,885
201,694,997
1,108,253,862
3,914,175,176
2,325,685,876
189,133,241
1,399,356,059
1,102,945,300
662,821,579
416,224,571
23,899,150
714,286,062
364,521,492
308,289,392
41,475,178
-
-
4,352,882,044
2,602,809,464
617,919,568
1,132,153,012
4,628,461,238
2,690,207,368
497,422,633
1,440,831,237
(1,630,348,676)
(37,050,698)
(1,612,993,634)
(39,791,087)
(1,495,593,702)
(45,610,697)
(1,198,836,708)
(44,076,179)
-
-
(3,125,942,378)
(82,661,395)
(2,811,830,342)
(83,867,266)
26,363,477
(67,853,555)
(19,906,375)
-
-
(168,369,630)
2,301,181,542
(392,648,402)
(484,550,646)
-
-
1,619,588,068
Add: Non-operating income
Less: Non-operating expenses
-
4. Profit / (loss) before tax
5. Total assets
6. Total liabilities
-
(392,648,402)
(484,550,646)
6,634,513
(2,649,273)
15,001,545
(3,651,857)
3,985,240
11,349,688
95,285,122
1,619,588,068
2,301,181,542
133,516,400,273
139,393,849,482
19,017,667,078
12,844,918,576
213,529,169
119,777,171,197
126,825,113,235
21,582,767,189
14,965,433,036
-
(a) Other income includes investment income, gains or losses from changes in fair value, foreign exchange gains or
losses and other income.
92
Total
Unallocated items
2013
(100,516,075)
3. Operating profit / (loss)
Personal banking
93
1,226,939,666
6,634,513
(2,649,273)
1,230,924,906
6,457,102
1,816,630,896
15,001,545
(3,651,857)
1,827,980,584
152,747,596,520 152,334,053,180
- 141,359,938,386 141,790,546,271
39 Fiduciary activities
40 Pledged assets
agement and supervision responsibilities related to risk
Assets pledged as security
(1) Entrusted lending business
(2) Geographic information
control of the Bank, including periodically assess the
2013
The following table sets out information about the
At the balance sheet dates, the entrusted loans and
geographical location of the Bank’s operating income
funds were as follows:
from external customers and the Bank’s non-current
2013
assets (excluding financial instruments, deferred tax
2012
Secured liabilities
-
2012
Bank’s overall risk exposures, provide guidance for
developing a sound risk management and internal
7,920,000,000
control strategies and policies, and monitor their implementation. The Risk Management Committee reports to
Carrying value of pledged assets
analysed by balance sheet classification
the Board of Directors. The Bank’s senior management
is responsible for establishing risk management policies
assets, same as below). The geographical information is
Entrusted loans
based on the location of customers receiving services.
16,294,361,580
18,766,531,856
Available - for - sale financial assets
The geographical location of the specified non-current
Entrusted funds
16,294,361,580
-
and procedures, including specific risk management
8,042,092,500
policies for credit risk, interest rate risk and exchange
18,766,531,856
rate risk based on the risk management strategy
assets is based on the physical location of the asset, in
approved by Risk Management Committee and Board of
the case of fixed assets; and the location of the operation to which they are allocated, in the case of intangible
assets.
(2) Custodian business
Operating income
from external customers
2013
2012
Outside Mainland China
5,833,614,039
6,019,384,895
405,919,014
420,763,470
6,239,533,053
Directors.
under repurchase agreements. These transactions are
performed by different head office departments upon
conducted under usual and customary terms of borrow-
approval from the Board of Directors. The internal audit
ing.
department of the Bank is responsible for independently
At the balance sheet dates, the Bank’s Qualified Foreign
Institutional Investors (QFII) and Qualified Domestic
In Mainland China
Secured liabilities are recorded as financial assets sold
Institutional Investors (QDII) balances were as follows:
2013
2012
6,440,148,365
Specified
non-current assets
2013
QDII
2012
81,385,783,540
75,682,252,678
37,041,939,069
8,655,813,030
ment will cause a financial loss for the other party by
levels. The Bank’s main operating risks include credit
failing to discharge an obligation. Credit risk mainly
risk, market risk and liquidity risk. Market risks include
objective is to reach an appropriate balance between
-
-
risks and rewards, while minimising the negative impact
277,877,943
312,978,730
(3) Major customers
arises from credit business. In treasury transactions,
credit risk refers to the possibility that the value of the
assets held by the Bank may decrease due to a fall in the
rating of the issuer of the debt security.
on its financial statements.
At the balance sheet dates, the Bank’s off-shore wealth
The Bank’s risk management policies aim to identify and
management services balances were as follows:
analyse risks to establish appropriate risk limits and
Credit business
Considering
control measures, and to monitor risks and risk limits via
2013
The Bank’s interest income generated from top ten
loans and advances customers was Renminbi 171,817,201
Off - shore wealth
management services
(2012: Renminbi 132,606,016), which contributed 6%
(2012: 4%) of the Bank’s total interest income of loans
11,237,25 1,655
2012
10,684,304,750
94
the
market
economic
environment,
business development strategy and the requirements of
an information system.
clients, the Bank provides various direct credit and
direct credit substitute businesses in the scope of risk
The Bank’s Board of Directors is responsible for estab-
control to foreign-invested companies set up in the PRC
lishing the Bank’s risk management strategy. The Bank’s
by multinationals, domestic companies with good credit
Risk Management Committee is in charge of the man-
and advances.
are
Credit risk is the risk that one party to a financial instru
accepts and manages risks, or risk portfolios at different
312,978,730
(3) Off-shore wealth management services
policies
(1) Credit risk
The Bank is exposed to many financial risks due to its
277,877,943
Outside Mainland China
management
41 Risk management
interest rate risk and exchange rate risk. The Bank’s
In Mainland China
risk
inspecting risk management and internal control.
operating activities. The Bank analyses, evaluates,
QFII
These
95
41 Risk management
standing, as well as individual customers of good credit.
A comparison of the Bank’s loan risk classification criteria and Yin Jian Fa [2007] No. 54 has been filed with the CBRC as follows:
The Bank has established a strict credit management system, including credit approval, daily credit monitoring, reme-
Internal
grading
Definition
Five -tier
grading
Definition
dial management, policies for loan loss provisioning and loan write-off and restructuring.
Pass / PWL
No evident weakness
Normal
Normal loans
The Bank adopts the loan risk classification approach introduced by Citigroup to monitor the risk condition of its loan
Speical Mention
/ substandard (accruing)
Has potential weakness
that deserves close attention
Special mention
The repayment might be
adversely affected by some factors
Substandard
(non - accruing)
Has a well -defined
weakness that jeopardise
the paying capacity of
the borrower
Substandard
The borrower ’s capacity
to repay is apparently in
question and certain
losses might occur even
when guarantees are executed
Doubtful
Collection or liquidation
in full high ly
questionable and
improbable
Doubtful
Cannot repay principal
and interest in full and
significant losses will
occur even when
guarantees are executed
Loss
Uncollectible
Loss
Principal and interest
cannot be recovered after
taking all possible measures
portfolios. Loans are classified by a five-tier grading system: pass / Pass Watch List (PWL), special mention/substandard (accruing), substandard (non-accruing), doubtful and loss, according to risk levels. The five-tier grading for loans
and advances is defined as follows:
Internal credit
Definition of corporate
Defintion of cunsumer
banking* */corporate
grading
banking *
banking***
Pass / PWL
Special Mention /
substandard (accruing)
No evident weakness
Has potential weakness that deserve
No overdue records
management’s close attention. If left
uncorrected, the potential weakness
may result in deterioration of the
days
Substandard
(non - accruing)
paying capacity or credit posi tion of
the borrower at some future date
Inadequately protected by the current
net assets and paying capacity of the
Overdue 1 - 89
Overdue 90 - 179
days
borrower . Assets so classified must
have a well - defined weakness, or
weaknesses , that jeopardise the
Doubtful
Loss
timely repayment of its obligations,
certain losses might incur even
if collaterals are realised.
With the added characteristic that
The last three gradings of the CBRC’s five-tier classification are regarded as impaired loans and advances. If there is any indication of
objective evidence that impairment and impairment loss has occurred, the loan is classified as an impaired loans and advances. The
provision for impairment of impaired loans and advances shall be assessed collectively or individually based on the actual condition.
The Bank manages, restricts and controls identified centralised credit risks, especially credit risks centralised in a single borrower,
group or industry. The Bank sets limits on the same borrower, group or industry to optimise its credit risk structure. The Bank monitors these risks regularly, and reviews them annually or more frequently if necessary. The Bank manages credit risk via timely analysis
Overdue 180 - 359
of the borrower’s ability to repay the principal and interest, and adjusts its credit lines accordingly. Other specific risk management
the weaknesses make collection or
liquidation in full, on the basis of
current conditions, highly
questionable and improbable
days
and mitigation measures include the following:
Uncollectible and of such little value
that their continuance as bankable
assets is not warranted
Overdue over
360 days
The objective of credit commitment is to ensure the client obtains the funds needed. When the amount of credit commitment applied
by a client exceeds the credit line originally authorised, the Bank asks for a deposit from the client to reduce the related credit risk.
The Bank mitigates credit risk by obtaining collateral, guarantees and security from companies or individuals. The Bank has specified
categories of acceptable collateral, including properties, commercial assets (commercial properties and accounts receivables), and
*
The definition does not include corporate banking’s branch Small and Medium Enterprise (SME) loan product.
financial instruments (bonds and stocks). To reduce credit risk, the Bank has stipulated discount rates for different collaterals (the
ratio between the fast cash realisable value to the market fair value of the collateral) to reflect the cash realisable value. For a loan
**
The definition is taking personal mortgage loan for example. The consumer bank sets out different internal credit gradings
guaranteed by a third party, the Bank assesses the guarantor’s financial condition, historical credit record and ability to settle the
according to the overdue days for different products.
debts on behalf of the borrower.
***
Except for loans, collaterals or guarantees needed for other financial assets shall be determined by the nature of the instruments.
Corporate banking’s branch SME loan product applies the over-due method used by consumer banking.
96
97
41 Risk management
Generally, no collaterals are designated for investments in debt securities, treasury bonds and other notes, and financial instrument
(ii) The balances represent collectively assessed allowances of
portfolios are generally used as collateral for asset-backed securities.
impairment losses.
(2) Market risk
Treasury business
The Bank sets credit limits based on the credit risk inherent in the products, counterparties and geographical area. The system closely
(c) Distribution of amounts due from inter-banks in
monitors the credit exposure on a real-time basis. The Bank regularly reviews its credit limit policies and routinely updates the credit
terms of credit ratings of counterparties
limits.
Market risk management involves an overall process of market
risks identification, measurement, monitoring and control.
Market risk refers to the risk of financial instruments’ fair value
Amounts due from inter-banks include deposits and placements
or future cash flow fluctuations due to changes in market
with inter-banks. Distribution of amounts due from inter-banks
(a) Maximum credit risk exposure
The maximum exposure to credit risk is represented by the carrying amount of each financial asset, including derivative financial
instruments, in the balance sheet. The maximum exposure to credit risk in respect of these financial guarantees at the balance sheet
prices, including foreign exchange risk, interest rate risk and
in terms of credit quality mainly with reference to the external
other price risk. Foreign exchange risk refers to the risk of
rating agency Standard & Poors’ was as follows (counterparties
financial instruments’ fair value or future cash flow fluctuations
without external ratings are presented using their parent
date is disclosed in Note 43(1).
due to changes in foreign exchange rates; interest rate risk
companies’ ratings):
refers to the risk of financial instruments’ fair value or future
(b) Distribution of loans and advances to customers in terms of credit quality
Note
Impaired
Individually assessed and
impaired gross amount
Impairment losses
Carrying amount
Overdue but not impaired
- less than 90 days
- 90 days to 180 days
Impairment losses
201 2
289,243,568
(263,485,385)
271,365,674
(243,010,357)
25,758,183
---------------------
28,355,317
---------------------
Total carrying amount
cash flow fluctuations due to changes in interest rates; other
price risk refers to the market risks other than foreign
Neither overdue
nor impaired
- A to AAA
- B to BBB +
- unrated
Total carrying amount
exchange risk and interest rate risk.
25,113,108,914
11,434,475,857
1,810,741,932
27,652,675,281
6,601,304,969
1,843,793,164
The Bank’s interest rate risk includes the risks arising from
38,358,326,703
36,097,773,414
related to banking business and from positions held for trading
mismatches of the term structures of assets and liabilities
purpose in treasury transactions. The Bank calculates its
interest rate risk exposure according to the maturity dates of
(ii )
305,702,824
30,335,116
(31, 846,719)
304,191,221
---------------------
(ii )
61, 430,401,544
(372, 422,552)
62,797,39 5
(256,601)
62,540,794
--------------------63,117,522,415
(257,908,845)
(d) Distribution of debt securities in terms of credit
all its interest-bearing assets and liabilities, and performs daily
quality
interest rate sensitivity analysis and periodical stress test.
Meanwhile, by closely observing interest rate trends (both in
The carrying amounts of debt securities analysed by the exter-
Renminbi and foreign currency) and market interest rate
nal rating agency Standard & Poors’ designations at the
changes, the Bank conducts proper scenario analysis and
balance sheet dates were as follows:
makes timely adjustments to the loan and deposit interest rates
(both in Renminbi and foreign currency) in line with the bench-
2013
Carrying amount
2012
(i )
Carrying amount
Neither overdue nor impaired
Gross amount
Impairment losses
2013
2013
61, 057,978,992
--------------------61,387,928,396
mark interest rates to reduce its interest rate risk.
2012
62,859,613,570
---------------------
The Bank’s foreign currency risk exposures mainly arise from
62,950,509,681
(i) As at 31 December 2013, the overdue but not impaired loans and advances amounted to Renminbi 336,037,940. The covered
portion and uncovered portion of these loans and advances were Renminbi 92,689,699 and Renminbi 243,348,241, respectively. The
fair value of collaterals held against these loans and advances amounted to Renminbi 270,277,236.
on balance sheet assets and liabilities designated in foreign
- AAA
- AA- to AA +
Total
252,920,110
20,242,820,418
290,533,340
19,357,583,826
20,495,740,528
19,648,117,166
currencies and off balance sheet derivatives designated in
foreign currencies. The Bank’s main principle of currency risk
control is to match the assets and liabilities of the respective
individual currency to minimize the foreign exchange risk, and
to control the currency risk within limits set by the Bank. The
The fair value of these collaterals was estimated by the Bank based on the external valuations adjusted after taking into account the
Debt securities include trading financial assets and availa-
current realisation experience in view of the collaterals and pledges as well as the latest market situation.
ble-for-sale financial assets.
98
Bank, based on the guiding principles of Risk Management
99
41 Risk management
Committee, relevant laws and regulations and the manage-
—
ment’s evaluation of the current environment, has set risk
or dispose of positions within that period. This is considered to
tolerance limits, and minimises the mismatch of assets and
be a realistic assumption in almost all cases but may not be the
liabilities in different currencies via reasonable arrangements
case in situations in which there is severe market illiquidity for
on the source and usage of foreign currency capital. Foreign
a prolonged period;
Interest rate risk
Foreign currency risk
Total VaR
—
A 99% confidence level does not reflect losses that may
To address the above limitations in VaR analysis, the Bank
presented according to the due dates of interest stipulated in
occur beyond this level. Even with the model used there is 1%
performs retrospective tests periodically to ensure the effec-
the contracts; current financial assets and liabilities (including
probability that losses could exceed the VaR;
tiveness of the relevant models. Furthermore, the Bank
interest receivable and payable as at the balance sheet dates)
performs market risk stress testing periodically to assess the
are presented under the item “repayable on demand”. Since
maximum losses under extreme price fluctuation scenarios.
derivatives are generally held for short-term purposes, their
A 1-day holding period assumes that it is possible to hedge
the liquidity status of the Bank.
2012
As at 31
December
25.70
12.52
28.95
Average Maximum Minimum
25.87
11.70
30.01
41.45
21.09
43.93
The following tables provide an analysis of the contractual
16.33
3.66
21.17
undiscounted cashflows of the Bank’s financial assets and
liabilities at the balance sheet dates. Interest receivable and
currency exposures are managed based on business category,
payable of financial assets and liabilities with fixed terms are
delegated trader authorisation limits, currencies and risk
factors. The Bank conducts hedge transactions with overseas
branches of Citibank to offset exchange rate risks for derivatives designated in foreign currencies.
—
VaR is calculated on an end-of-day basis and does not
The Bank classifies financial instruments into investment
reflect exposures that may arise on positions during the trading
portfolios held for trading and non-trading investment portfoli-
day; and
cashflows are not included in the following analysis.
(3) Liquidity risk
os to effectively monitor market risk. The Bank mainly manages
market risk via its market risk limit policy. According to the
—
CBRC’s Market Risk Management Guidelines for Commercial
possible range of future outcomes may not always cover all
Banks and Citigroup’s global risk management policy, the Bank
possible scenarios, especially those of an exceptional nature.
The use of historical data as a basis for determining the
has established market risk limits and measurement policies to
set related limits and approval mechanism on all market risk
A summary of the VaR of the Bank’s trading portfolios at the
exposures. The policies illustrate the structure and approval
balance sheet date and during the respective year is as follows:
system of market risk limits. Market risk limits mainly include
(Renminbi million)
Liquidity risk is the risk that a financial institution fails to meet
its obligations related to financial liabilities due to lack of funds
caused by mismatches between the amounts and maturity
dates of assets and liabilities.
The primary liquidity risk management measure adopted by the
Bank is to match the maturity date structures between assets
risk factor limits, position limits, value-at-risk (VaR) limits and
and liabilities. Due to differences between various businesses
stop-loss trigger.
2013
As at 31
December
Interest rate risk
8.90
Foreign currency risk 8 .83
Total VaR
11.02
VaR analysis
For investment portfolios held for trading, the Bank adopts VaR
analysis to evaluate market risk. VaR estimates potential losses
and maturity tenors, it is impractical to maintain a perfect
Average Maximum Minimum
19.47
34.87
7.67
match between assets and liabilities. To meet relevant liquidity
requirements, the Bank has established a set of thresholds for
12.80
26.87
3.58
managing, measuring, monitoring and reporting liquidity risk,
20.77
36.56
8.29
including liquidity limits for normal operations, liquidity ratios,
market triggers and regular stress testing. In addition, the Bank
arising from changes in market interest rates and prices within
established Liquidity Funding Plan and Contingency Funding
a defined period and confidence interval. The Bank’s market
Plan to maintain an appropriate balance of cash flows and to
risk management department calculates the VaR of investment
ensure all the required funds can be provided at maturity.
portfolios held for trading according to the historical changes
of the market interest rates and prices (confidence interval:
The Finance department provides a daily calculation of regula-
99%, observation time: 1 trading day).
tory liquidity ratios to relevant departments of the Bank. Global
Markets department is responsible for managing the liquidity
Although VaR is an important tool for measuring market risk,
risk on daily basis and executes the liquid funds instructions.
the assumptions on which the model is based do give rise to
Market Risk Management monitors the liquidity risk independe-
some limitations, including the following:
ntly. The Asset Liability Committee will also regularly review
100
101
41 Risk management
2012
2013
Carrying amount
Contractual
undiscounted
cashflows
Repayable
on demand /
terms undated
Within
one month
26,885,794,247
26,885,794,247
26,885,794,247
-
38,358,326,703
3,266,961,398
2,828,654,593
39,267,095,616
3,357,516,120
2,828,654,593
7,406,939,918
2,828,654,593
8,139,828,895
919,786,684
-
Assets
with central bank
Deposits and placements
with inter-banks
Available-for-sale
financial assets
Loans and advances to
customers
Other assets
17,228,779,130
17,776,458,652
-
998,791,000
62,055,683,052
2,116,473,400
62,835,072,529
2,116,473,400
2,108,620,087
1,668,074,187
16,408,864,106
76,444,600
Total assets
152,740,672,523
155,067,065,157
40,898,083,032
26,543,715,285
---------------
---------------
---------------
---------------
Assets
with central bank
with inter-banks
Available-for-sale
financial assets
customers
Other assets
Total assets
Liabilities
Deposits and borrowings
from inter-banks
Derivative financial
liabilities
Other liabilities
Total liabilities
Net position
(31,093,649,384)
(31,208,775,590)
(8,871,124,754)
(5,161,804,036)
(2,844,811,150)
(96,624,103,633)
(10,528,418,064)
(2,844,811,150)
(96,829,178,027)
(10,705,280,438)
(2,844,811,150)
(57,028,076,206)
(3,049,049,378)
(21,096,401,268)
(328,368,663)
(141,090,982,231)
(141,588,045,205)
(71,793,061,488)
(26,586,573,967)
---------------
---------------
11,649,690,292
13,479,019,952
--------------(30,894,978,456)
---------------
Liabilities
from inter-banks
liabilities
Financial assets sold
under repurchase
agreements
Other liabilities
Total liabilities
(42,858,682)
Net position
Carrying amount
Contractual
undiscounted
cashflows
Repayable
on demand /
terms undated
Within
one month
30,637,522,420
30,637,522,420
30,637,522,420
-
36,097,773,414
3,512,945,036
1,690,055,766
36,403,894,356
3,770,131,347
1,690,055,766
12,408,955,148
1,690,055,766
9,099,832,442
-
16,135,172,130
16,756,457,199
-
-
63,451,685,484
783,294,402
75,869,163,243
783,294,402
1,625,299,986
382,260,895
13,412,044,752
29,606,412
152,308,448,652
---------------
Assets
with central bank
with inter-banks
Available-for-sale
financial assets
customers
Other assets
Total assets
(19,132,376,867)
(6,204,214,713)
(1,430,554,047)
(1,430,554,047)
(1,430,554,047)
(7,920,000,000)
(103,566,097,380)
(9,478,826,877)
(7,927,453,889)
(108,825,303,786)
(9,478,826,877)
(68,651,652,353)
(9,243,072,235)
(141,455,118,718)
Total liabilities
Between
three months
and one year
Between
one year and
five years
More than
five years
-
-
-
-
7,755,659,646
300,655,584
-
12,598,408,255
1,508,782,051
-
3,366,258,902
547,939,618
-
80,352,183
-
49,567,550
12,091,942,652
4,636,157,450
-
12,043,627,332
46,070,466
11,594,015,919
209,384,459
7,309,496,856
116,306,373
13,370,448,229
193,315
20,195,580,578
38,002,533,336
15,976,159,199
13,450,993,727
---------------
---------------
---------------
---------------
Net position
(4,925,593,245)
(8,613,011,423)
(3,637,242,132)
(11,026,635,586)
(1,327,101,438)
(5,292,226,575)
(4,178,347,135)
(15,514,273)
(1,822,413,824)
(17,279,330,269)
(18,083,585,133)
(5,475,170,229)
(2,370,324,119)
-
---------------
10,853,329,934
19,116,003,267
(85,529,493,348)
--------------(38,785,399,133)
(6,355,350,214)
(7,927,453,889)
(19,732,060,205)
(36,919,974)
(34,051,784,282)
--------------(11,510,300,676)
Assets
with central bank
with inter-banks
Available-for-sale
financial assets
customers
Other assets
Liabilities
from inter-banks
liabilities
Financial assets sold
under repurchase
agreements
Other liabilities
Between one
month and
three months
Between
three months
and one year
Between
one year and
five years
More than
five years
-
-
-
-
5,215,999,658
-
8,681,254,972
623,497,155
-
997,852,136
3,045,934,147
-
100,700,045
-
-
8,145,071,577
8,611,385,622
-
19,725,625,236
48,813,847
12,717,046,422
151,812,366
10,535,569,201
170,485,881
17,853,577,646
315,001
24,990,438,741
---------------
(1,178,378,110)
30,318,682,492
17,954,592,692
---------------
---------------
(1,844,041,561)
(3,550,392,269)
-
-
-
-
(9,653,847,516)
(96,064,431)
(66,199,015)
(40,501,574)
-
(10,721,544,697)
(62,268,663)
23,361,226,987
---------------
(2,370,324,119)
---------------
---------------
---------------
---------------
2,916,250,309
19,918,948,203
10,500,988,970
11,080,669,608
Total liabilities
Net position
102
(146,794,515,466)
---------------
22,541,483,606
---------------
2012
Total assets
Liabilities
from inter-banks
liabilities
Other liabilities
46,744,094,215
---------------
(19,059,640,414)
2013
Between one
month and
three months
165,910,518,733
---------------
(11,593,953,508)
(3,657,092,858)
-
---------------
(11,962,191,470)
---------------
---------------
---------------
13,028,247,271
18,724,728,984
19,704,134,129
17,954,592,692
103
41 Risk management
requirements relating to capital adequacy ratio required
(4) Capital management
regulatory capital requirements.
31 December 2013
by CBRC. For systematicaly-impartant banks, the
adequacy ratio of core tier one capital shall not be less
The risk weighted assets of on-balance sheet assets are
that 8.5%; the adequacy ratio of tier one capital shall
calculated based on various risk weights. The risk
The capital management of the Bank covers the calcula-
not be less than 9.5%; and the capital adequacy ratio
weights are determined in consideration of the risk
tion and reporting of capital adequacy ratio (CAR),
shall not be less than 11.5%, as at 31 December 2018. For
factors of various assets, counterparties, markets and
capital assessment and capital planning. The CAR of the
non-systematically-important banks, the adequacy ratio
other relevant aspects, as well as qualified collateral
Bank represent its ability to operating healthily and
of core tier one capital shall not be less than 7.5%; the
and guarantee. The off-balance sheet exposures are
dealing with risks. The CAR management of the Bank
adequacy ratio of tier one capital shall not be less than
calculated by the similar methodology with adjustments
aims to ensure the Bank held adequate capital, which is
8.5%; and the capital adequacy ratio shall not be less
of contingent losses. The credit risk weighted assets for
appropriate to risk exposure and consistent with risk
than 10.5%, as at 31 December 2018. The CBRC also
counter parties in terms of over-the-counter derivative
assessment result of the Bank, to meet the demand of
required conmmercial banks to introduce reverse
transactions are the summation of defaulted risk
business operation and the requirement of relavant
capital during transition period. As at 31 December 2013,
weighted assets and credit valuation adjustment risk
regulatory. The capital planning aims to set a target
for non-systematically-important banks, the adequacy
weighted assets. The market risk weighted assets are
CAR which satisfies the Bank with the demand of future
ratio of core tier one capital shall not be less that 5.5%;
measured by standard method. The operational risk
business development strategy, risk appetite, risk man-
the adequacy ratio of tier one capital shall not be less
weighted assets are measured by basic indicator
agement, external business environment and long-term
than 6.5%; and the capital adequacy ratio shall not be
method.
sustainability of various capital sources.
less than 8.5%.
adequacy ratio not to be less than 8%, and the adequa-
ments prepared in accordance with the CAS. The Bank is
level to support business development under all condi-
cy ratio of core capital not to be less than 4%. As at 31
in compliance with the regulatory capital requirements
tions and to adjust CAR to a reasonable level timely and
December 2012, the capital adequacy ratio of the Bank
during the year.
effectively, if necessary.
was calculated in accordance with the Administration of
Capital Adequacy Ratios of Commercial Banks Proce-
The adequacy ratio of core tier one capital, the adequa-
The management monitor the utilisation of CAR and
dures issued by the CBRC and other related laws and
cy ratio of tier one capital and the capital adequacy ratio
regulatory capital according to the requirement of
regulations.
as at 31 December 2013 calculated in accordance with
one capital, other tier one capital and tier two capital.
Since 1 January 2013, the capital adequacy ratio of the
Bank (For Trial Implementation) and other related laws
The Bank reported relevant information to CBRC on a
Bank has been calculated in accordance with Adminis-
and regulations are as follows:
quarterly basis.
trative Measures on Capitals of Commercial Bank (For
lated in accordance with Administrative Measures on
sea branches.
Capitals of Commercial Bank (For Trial Implementation)
13. 7 6 %
Adequacy ratio of tier one capital
13. 7 6 %
Capital adequacy ratio
14. 2 2 %
ratio as at 31 December 2012 calculated in accordance
with Administration of Capital Adequacy Ratios of Commercial Banks Procedures and other related laws and
regulations were as follows:
31 December 2012
tions, and the calculation result is in compliance with the
104
Adequacy ratio of core tier one capital
The core capital adequacy ratio and capital adequacy
issued by the CBRC and other related laws and regulaCommercial banks shall conform to the regulatory
82,770,443,222
(a) The total risk assets are composed of weighted
Trial Implementation) issued by the CBRC and other
land China. Currently, the Bank does not have any over-
11,766,169,034
Total risk assets (a )
Administrative Measures on Capitals of Commercial
the capital adequacy ratio of the Bank has been calcu-
Net capital
risk assets include 12.5x market risk assets.
ensures the Bank to retain its capital at an adequate
covers all branches and sub-branches located in main-
11,387,658,134
weighted operational risk assets. Weighted market
Bank are calculated on the basis of the financial state-
related laws and regulations. As at 31 December 2013,
Net tier one capital
The capital adequacy ratio and relevant data of the
Before 1 January 2013, the CBRC required the capital
The scope of the Bank’s CAR calculation of the Bank
11,387,658,134
credit risk assets, weighted market risk assets and
The prudent and solid concept of capital management
CBRC. The capital of the Bank is composed of core tier
Net core tier one capital
105
Core capital adequacy ratio
16.63%
Capital adequacy ratio
16.99%
42 Fair value of financial instruments
(1) Financial instruments measured
at fair value
traded in active markets are based on quoted market prices or
tion in the determination of fair value. Management judgement and estimation are usually required for selection of the appropriate
dealer price quotations. For all other financial instruments the
valuation model to be used, determination of expected future cash flows on the financial instrument being valued, determination of
Bank determines fair values using valuation techniques.
probability of counterpart default and prepayments and selection of appropriate discount rates. For those more complex financial
instruments, the Bank performs calibration and back testing of models against observed market transactions and conduct regular
The following table presents the carrying value of financial
Valuation techniques include net present value and discounted
instruments measured at fair value as at 31 December across
cash flow models, comparison to similar instruments for which
the three levels of the fair value hierarchy. The level in the fair
market observable prices exist, polynomial option pricing
The Bank has an established control framework with respect to the measurement of fair values. The Bank’s processes include a
value hierarchy within which the fair value measurement is
models and other valuation models. Assumptions and inputs
number of key controls that are designed to ensure that fair value is measured appropriately, particularly where a fair value model is
categorised in its entirety is determined on the basis of the
used in valuation techniques include risk-free and benchmark
internally developed and used to price a significant product. Such controls include a model validation policy requiring that valuation
lowest level input that is significant to the fair value measure-
interest rates, credit spreads and other premia used in estimat-
models be validated by qualified personnel, independent from those who created the models and escalation procedures, to ensure that
ment in its entirety. The levels are defined as follows:
ing discount rates, bond and equity prices, foreign currency
valuations using unverifiable inputs are identified and monitored on a regular basis by senior management. Approvals from both
exchange rates, equity and equity index prices and expected
market risk department and product control department must be obtained prior to the use of valuation methodologies. The Bank’s
Level 1 – fair value measurements using quoted prices in active
price volatilities and correlations. The objective of valuation
valuation models are reviewed and approved by market risk department which is independent from the front office.
markets for identical assets or liabilities
techniques is to arrive at a fair value determination that
stress testing.
2013
reflects the price of the financial instrument at the reporting
Level 2 – fair value measurements using inputs other than
date, that would have been determined by market participants
quoted prices included within Level 1 that are observable for the
acting at arm’s length.
asset or liability, either directly or indirectly
The Bank uses widely recognised valuation models for deterThis category includes instruments using valuation technique:
mining the fair value of common and more simple financial
quoted market prices in active markets for similar instruments;
instruments, like interest rate and currency swaps that use only
quoted prices for identical or similar instruments in markets
observable market data and require little management judge-
that are considered less than active; or other valuation
ment and estimation. Observable prices and model inputs are
techniques where all significant inputs are directly or indirectly
usually available in the market for listed debt and equity securi-
observable from market data.
ties, exchange traded derivatives and simple over the counter
Level 1
RMB
Level 2
RMB
Level 3
RMB
Total
RMB
8
9
3,207,050,428
-
59,910,970
2,828,397,726
256,867
3,266,961,398
2,828,654,593
11
17,228,779,130
-
-
17,228,779,130
20,435,829,558
2,888,308,696
256,867
23,324,395,121
-
2,844,554,283
256,867
2,844,811,150
Note
Assets
Available-for-sale
financial assets
Total
Liabilities
liabilities
9
derivatives like interest rate swaps.
Level 3 – fair value measurements using inputs for the asset or
liability that are not based on observable market data
For more complex financial instruments, the Bank uses proprie-
2012
tary valuation models, which usually are developed from recog-
Note
This category includes all instruments where the valuation
nised valuation models. Some or all of the significant inputs into
technique includes inputs not based on observable data and the
these models may not be observable in the market, and are
unobservable inputs have a significant effect on the instru-
derived from market prices or rates or are estimated based on
ment’s valuation. This category includes instruments that are
assumptions.
valued based on quoted prices for similar instruments where
unobservable inputs include certain over the counter struc-
Assets
Available-for-sale
financial assets
significant unobservable adjustments or assumptions are
tured derivatives, certain loans and securities for which there is
Total
required to reflect differences between the instruments.
no active market and retained interests in securitisations.
Example of instruments involving significant
Valuation models that employ significant unobservable inputs
Fair values of financial assets and financial liabilities that are
require a higher degree of management judgement and estima-
106
Liabilities
liabilities
Level 1
RMB
Level 2
RMB
Level 3
RMB
Total
RMB
8
9
3,433,123,836
-
79,821,200
1,687,789,911
2,265,855
3,512,945,036
1,690,055,766
11
16,135,172,130
-
-
16,135,172,130
19,568,295,966
1,767,611,111
2,265,855
21,338,172,932
-
1,428,288,192
2,265,855
1,430,554,047
9
107
42 Fair value of financial instruments
43 Commitments and contingent
liabilities
During the year ended 31 December 2013, there was no signifi-
2013
(2) Fair value of other financial instruments
(not measured at fair value)
cant transfer between instruments in Level 1 and Level 2.
(1) Credit commitments
Contractual amount
During the year ended 31 December 2013, there was no change
At any given time the Bank has outstanding commitments to
in valuation techniques for fair value measurements.
extend credit. The Bank provides loan commitments, unused
The Bank’s other financial assets mainly include deposits with
central bank, deposits with inter-banks, placements with
The movement of fair value measurements in Level 3 of the
inter-banks and loans and advances to customers.
fair value hierarchy for the year is as follows:
Except for loans and advances to customers, most financial
201 3
Derivative
F inancial
assets
RMB
Balances at the beginning
of the year
Total gains / (losses)
- in profit or loss
Settlements
Derivative
financial
liabilities
RMB
2,265,855 (2,265,855)
8,302,169 (8,302,169)
(10,311,157) 10,311,157
assets are due within one year or are measured at fair value;
Total
RMB
-
therefore their carrying amounts are close to their fair values.
Loans and advances to customers are recorded at amortised
cost less impairment losses (see Note 10). Since the interest
rates for loans and advances are adjusted on a real-time basis
based on the PBOC’s stipulated interest rates, and impaired
Balances at the end of the year
256,867
Total gains / (losses)
for the year recognised
in profit or loss for
assets held at the end of the year 256,867
(256,867)
-
loans have been reduced at the amount of impairment losses
to reflect the recoverable amount, the carrying amounts of
(256,867)
-
loans and advances are close to their fair values.
The Bank’s financial liabilities that are recorded at amortised
Sensitivity analysis on fair value mearsurements in Level 3 of
cost mainly include deposits from inter-banks and non-bank
the fair value hierarchy
financial institutions, borrowings from inter-banks, financial
Unused credit card facilities
Loan commitments
- with an original maturity within
one year
- with an original maturity of one
year or over
credit card facilities, financial guarantees and letters of credit
to guarantee the performance of customers to third parties.
The Bank assesses the potential loss of credit commitment on a
periodic basis and recognises liabilities if necessary.
Standby letters of credit issued
and guarantees
Acceptances
Letters of credit accepted
Letters of credit issued
Letters of credit confirmed
The contractual amounts for loan commitments and credit card
unused facilities represent the total amounts if the Bank makes
the fully payments. The amounts in the table for guarantees
and letters of credit represent the maximum potential loss that
would be recognised at the balance sheet date if counterparties
failed to completely perform as contracted. Acceptances
Total
comprise undertakings by the Bank to pay bills of exchange
4,786,616,569
892,182,262
391,984,000
340,296,000
1,194,156,563
1,835,802,955
6,372,757,132
---------------------
3,068,281,217
---------------------
3,893,181,680
645,835,153
325,388,974
186,691,939
59,432,664
3,460,711,261
930,318,098
458,689,473
526,958,366
67,562,984
5,110,530,410
---------------------
5,444,240,182
---------------------
11,483,287,542
8,512,521,399
drawn by customers. The Bank expects most acceptances to be
settled simultaneously with reimbursement from customers.
As the credit facilities may not be fully used upon maturity, the
contractual amount sets out below does not represent the
(2) Credit risk weighted amount
expected cash flow out in the future.
assets sold under repurchase agreements and deposits from
The Bank’s Level 3 financial instruments are mainly structured
customers. As at the balance sheet date, the carrying amounts
derivatives. Any deals between the Bank and its customers are
of the Bank’s financial liabilities are close to their fair values.
2012
2013
Credit risk weighted amount of contingent
liabilities and commitments
fully squared with other financial institutions and there is no
3,662,655,242
open position. Thus, although fair value measurements of Level
The above assumptions and methodologies provide the
3 use inputs that are not based on observable market data and
consistant basis for calculating the fair value of the Bank’s
The capital adequacy ratio of the Bank as at 31 December 2012
the measurement is uncertain, there is no impact on the Bank’s
assets and liabilities. However, because other financial institu-
was Renminbi 5,349,695,464, which was calculated in accord-
current year profit or equity if such judgement and estimation
tions may use different assumptions and methodologies, the
ance with the Administration of Capital Adequacy Ratios of
on unobservable inputs changes.
fair value disclosed by each financial institution may not be
Commercial Banks Procedures (the Administration) issued by
comparable.
the CBRC and other related laws and regulations. The Administration was expired on 1 January 2013.
The credit risk weighted amount refers to the amount as
computed in accordance with the rules set out by the CBRC and
depends on the credit status of the counterparty and the matu-
108
109
rity characteristics. The risk weights used range from 0% to
150% of contingent liabilities and commitments. The credit risk
weighted amounts stated above have taken into account the
effects of bilateral netting arrangements.
(3) Operating lease commitments
As at 31 December, the total future minimum lease payments
under non-cancellable operating leases of properties were
payable as follows:
2013
Within 1 year (inclusive)
After 1 year but within
2 years (inclusive)
After 2 years but within
3 years (inclusive)
After 3 years
Total
201 2
290,439,790
256,611,906
166,231,090
214,188,843
74,718,038
40,106,719
104,987,530
47,325,141
571,495,637
623,113,420
(4) Capital commitments
As at 31 December, the capital commitments of the Bank were
as follows:
2013
2012
Leasehold improvement contracts
entered into but not performed or
performed partially
Purchase contracts entered into
but not performed
11,640,981
7,638,650
-
762,496
Total
11,640,981
8,401,146
110

Citibank (China) Co., Ltd.

Transcription

Similar documents

Spring 2011 - RC SSE Federal Credit Union

julian edelman - Tewksbury Youth Football

Text a command to MYCITI (692484) and get the

View Floor Plan - The Willard at 252 West 76th Street

INSTRUCTIONS FOR TAKING THE CITI ONLINE RESEARCH

EQUITY - RBFCU

BRAZOSP RT DEBT CONSOLIDATION LOANS

How to Complete the CITI Online Tutorial

Newsletter 01-15.indd

View Report - Financial Center Credit Union