China Construction Bank Corporation

Distinguished investors, analysts, media friends, ladies and gentlemen, good afternoon. A warm welcome to the China Construction Bank's 2024 annual results announcement.

Thank you all very much for your trust, attention and the support you have given to CCB. This announcement meeting, we'll have two venues in Beijing and Hong Kong, and we will also have the online webcast so that the shareholders and the public can also receive the announcements in real-time.

In Beijing venue, we have Mr. Zhang Yi, President of CCB; Vice President, Mr.

Zhu Xiaohuang, Party Member Ms. [indiscernible], the General Manager of Credit Loan Department, Mr.

[indiscernible]. In Hong Kong venue, there are Vice President, Mr.

[indiscernible]; Chief Information Officer, Mr. Jin Panshi; General Manager of Accounting Department, Mr.

Liu Fanggen. Attending the conference also include the Non-Executive Director, Independent Director and the Supervisors.

The heads of related departments of head office and also our Hong Kong institutions are also attending. I am Liurong, CFO of CCB.

CCB's 2024 annual results has already been released today, and the presentation material has also been released on our official website. For your reference, first, we will have the speech of Mr.

Zhang Yi, and then we'll have the Q&A session. Now let's welcome Mr.

Zhang.

Distinguished investors, analysts and media friends, good afternoon. Thank you all for attending CCB's 2024 annual results announcement.

2024 is the 75th anniversary of China and also 70th anniversary of CCB. In the past 70 years, we developed along with the prosperity of China and the leadership of CCB has all contributed to the prosperity of our country and also the well-being of our people.

Since we got listed, under the strong support of our supporters and also the people, we have realized very steady development across in all life cycles and we continue to give returns in a very constant way to our shareholders and also to our supporters. I would like to thank you all for your trust.

Today, the Board of Directors of CCB has already approved our annual results. Now I would like to share with you the 2024 annual results of CCB and our future outlook and plan.

In 2024, we have been adhering to the principle of President Liu Guiping and also the principles as set out the central government's meeting and also the Party Congress meeting under the National Congress meeting. And we also adhere to our principles of very steady and robust development.

We have made a very remarkable achievements. Our operating income is RMB728.6 billion and the loan is RMB3 billion, and our net profit is RMB336.3 billion.

The NPL ratio is 1.34%, decreased by 0.03 percentage points, especially the key indicators are leading in our industry. The net interest ratio is 1.51%, ROA, 0.85%, ROE 10.69%, capital adequacy ratio 19.69% and the cost-to-income ratio is 29.58%.

We have achieved such remarkable results. And we also adhere to five pillars.

First is the technology, and we stick to technology, finance power and national strategy industries, and we have a strengthened various system and mechanism. The loans to strategic emerging industries -- to technology-related industries is over RMB3.5 trillion and the loans to strategic emerging industries is at RMB2.84 trillion, both at an industry-leading way.

And the green loan is also very remarkable at RMB4.7 trillion, increased also significantly from last year. And for the loan, actually, it also exceeds RMB200 billion.

And the SE rating also is lifted up to AAA. It is the first Chinese Mainland bank to have such rating.

We are also one of the top 10 banks to realize the AAA ratings. And we also had our inclusive finance which is illuminating every household, the accumulate -- the balance of inclusive finance loans is at RMB3.41 trillion.

And the -- also, our support to the agricultural sectors continue to be ranked the first for three consecutive years, and we are also leading in terms of inclusive loan. And in terms of the pension finance, we also have the Jian Yang An brand, and we have three pillars to support Jian Yang An pension scheme and also the active users and also the social active -- social insurance cards in active use are also reaching new high and the loans that we issued to the public is also nearly RMB800 billion, and we are also in the leading place in terms of the digital economy.

We also serve to the national cause and try to increase the domestic demand. And we also executed various industries loan and our loan to the industry is -- of the group is RMB25.85 trillion, and we also exceeded RMB1 trillion in terms of the financial loans for policy banks.

And we are also serving the country's national -- regional development strategy. And our personal customers also decreased RMB770 billion and the balance of loan is also RMB5.4 trillion, also increased by 9.84%.

And in terms of the trade financing, we also have exceeded RMB550 million. We also set up the Shanghai financial centers to open more ports for cross-border financial business.

And as in the London clearance bank, we remain the largest RMB clearance bank outside Asia. And we also accelerated our share buyback to support the financial management companies and the asset management companies to open in Shanghai, Beijing, Suzhou and Hefei.

We also support the SMEs and various cities in terms of property loans. Thirdly, we also have a coordinated development to -- and in various departments and also associates of the bank.

We also emphasize on the customer-centered principle and tried always continue to enrich our customer services. And we have a company over 11 million corporate customers.

And for the online customers, we remain at over RMB500 million. And we also have a diversified wealth management products to satisfy the financing needs of various customers.

And we have the asset management scale of RMB5.56 trillion including the individual wealth management, and we are also number one in our industry in this regard. And we have realized new results of this coordinated development.

Especially for our overseas institutions, we continue to improve our efficiency. The AUM is $268 trillion, also a significant increase, and we maintain our position, and all our subsidiaries have improved their efficiency, and also, the profit increased by 15.7%.

Firstly, we also built a high-quality management system through long-term efforts and risk control. First, we try to consolify the risk accountability of the main body, and we also try to optimize the management of financing framework and system, and we try to take a preemptive way.

And the NPL also decreased by 0.03 percentage points. And our risk provision rate is continuing to be sufficient.

And in terms of the risk assets, for 10 consecutive years, we have realized the positive growth and we tried -- we also optimized our risk control capacity. In terms of internal auditing and internal control, we also enhanced the personnel's risk control awareness and also control measures.

We also emphasize on several key points like the systematic risk control, and we also continue to enhance our capability in anti-money laundering capacity. Fifthly, we also build a high-quality management system.

We optimize the group's top level management framework and also improve an integrated group-wide look through management framework, increased application and innovation of information technology including those of the overseas institutions and the subsidiaries and other aspects, total 10 aspects of this framework. And we also enhanced the data governance framework and also we implemented full life cycle management for data and the centralized the operation of the key platform.

And we also deepened the finance big model development, and we have over 190 scenarios. Over 4,000 projects.

We also have a DeepSeek-like big model deployment in terms of the AI system. We also have the full management of data.

And in terms of the point of purchase, the different outlets and the different subsidiaries, we promote a centralized operation of a complicated business and process optimization and will also enhance the penetration management framework of our overseas institutions and also our subsidiaries. 2025 is the beginning year of the 14th five-year plan.

According to President Liu Guiping’s instructions, we will strengthen our capability to enhance the financial system, we will focus on our bank business and uphold the principle of no financial risks, and we will comprehensively improve our capability and create value. We will adapt to the low interest environment and explore different approaches to high-quality development.

We will adopt the right methodologies, so CCB will achieve its objectives. We will keep the stable growth of loans.

We will enhance our efforts to support real economy. We will enhance our foundation of loan services.

We will optimize our asset structure, and we will focus on five main areas of finance with an optimized debt structure. We will optimize our revenue structure, so our NIM will outperform our peers.

Increasing the revenue in non-interest income, we must make sure that our investment and output are up to expectation. We will manage our asset quality countercyclical, and we will enhance our stable income.

In terms of future outlook, we will stick to our main business, offering high-quality contribution to real economy. We will start a number of measures targeted at boosting the consumption market by offering financial services.

We will align ourselves with the national strategy to boost consumption market. We will provide better financial services so we can enhance our status in consumer finance.

We will make full use of our advantage in infrastructure, financial services. We will use active approaches to developing the five major areas of finance.

We will better serve the new productive forces and we will have a new portfolio of green financial services, so we can offer better inclusive finance and enhancing the integration of offline and online financial platforms. We will have a more competitive elderly care financial services, where we will use digital technology to enhance our financial services.

We will better support the high-quality development of private companies. We will support the 2025 action plan and the 16 actions in order to serve better private economy.

We will support the coordinated development of urban and rural areas. We will serve the high-quality overseas services.

We will support the integration of EDGE and RMB. We will deep integrate our services with our customers' ecosystems, promoting our capabilities and offer better customer experience.

We must be an early starter in digital finance and enhance our efforts to develop the ecosystem, supply chain, industry chain and cooperation with universities and we will offer integrated services to meet customers' needs, offering better customer performance. We will offer high quality of customer services and understand them from their perspective, so our customer services can be bettered and perfected to create the maximum value of our group.

In internal management, we will enhance our own mechanism and lay a good foundation for development. We must be both efficient and safe so we can establish our operational system.

We will make good use of our customer managers and offer both offline and online services. Information technologies will be enhanced and digitalization transformation will be accelerated.

An internal risk control system will be established to enhance the three defense lines. We will enhance the see-trough management of overseas subsidiaries.

We will deepen our consumer protection mechanisms, and we will be a stabilizer for consumer finance. This year marked the 20th anniversary of our IPO.

We will stick to the spirit of reform and enhancing our capabilities so we can sail on the path of new development, creating a better future for all stakeholders. Thank you.

Thank you, President, Zhang. Now we will take some questions.

We will take questions from both Beijing and Hong Kong. [Operator Instructions].

Now we will take the first question from Beijing.

Thank you, management. From CGTN.

Thank you, management, for the introduction to the results. We have seen strong performance and stable performance of main indicators.

But what is the driving force behind the performance? Faced with the accommodative fiscal policies, how do you adjust your policies and how do you look at the revenue and profit level for this year?

President Zhang will take the question.

In 2024, we have seen progress amidst stability. We have seen clear signs of stability.

We have overcome the challenge of lower interest rate. We have seen higher net profit.

We have recorded RMB336 billion of net interest -- net profit, a year-on-year increase of 1.15% in ROE, NIM, and the cost revenue ratio have been market-leading. In terms of profit, we have seen 5.9% in asset and liability.

Our total asset is RMB40 trillion. We have transformed our light asset and non-interest revenue is down -- is up by 1.8%, and we enhanced our efforts to develop green finance, digital finance, elderly care finance and the loans to these areas have grown sharply.

Specifically, in three areas, we have targeted our efforts, revenue, cost and risk control. In terms of revenue, in interest income and noninterest income, we have different approaches, and we have coordinated different conditions to stabilize our net interest income.

We have kept the growth of net assets, and our daily balance is RMB39 trillion, up by 8%. Loan accounted for 88.5%, 1.3% up year-on-year.

We have strengthened our efforts to support new areas. For example, technology and other areas have seen very high-speed growth.

We supported retail finance and our mortgage loan customers exceeded 15 million. We have newly invested in RMB660 billion in mortgage loans.

Personal commercial consumer loans have seen high growth rate of 25%. At the same time, we have improved our risk-based pricing capability.

Our new personal loans -- mortgage loans, inclusive loans and RMB bonds, we have surpassed our peers in the revenue in these areas, and this has helped us lay a good foundation for keeping the NIM low. We have deepened our financial services and increased the contribution from non-interest income, and we have seized the opportunity in consumer finance.

We offer diversified financial services to consumers. Our commission and non-interest income amounted to RMB109 billion.

In online payments and the credit cards, et cetera, we have been doing pretty well. We have attracted the market dynamics in both equity and bond market.

We took preemptive measures to realize other non-interest income of RMB33 billion. As for risk control, we have reduced our cost of capital.

We enhanced the foundation for liabilities, lowering the cost of capital. We have managed the cycle of corporate capital, and we strengthened the low-cost settlement of capital.

As we said, our corporate customers surpassed 11 million and individual customers 700 million and payroll accounts over 16 million. We have been market-leading in these areas.

So our daily RMB deposit is at RMB27.6 trillion per day, a 6.5% year-on-year increase. And deposits, our CASA is 62%, leading the market.

And the interest payment rate 1.65%, down by 12 basis points, the lowest since 2022. We have reduced our operational cost and strengthened cost management.

We have seen tangible results in operational management, cost to revenue ratio of 29.8%. Operational revenue is up by [170] (ph).

And we have enhanced our coordinated control and improved the efficiency in our cost. And we supported strategic projects and customer accounts.

Financial technology is at 3.35% of our total cost. This is for cost.

In terms of risk mitigation, we reduced the cost of credit services. Risk control has been prioritized with a stable asset quality.

NPL ratio is down by 0.03%. Special mention loans, 0.5%, provision coverage ratio at 233%.

In 2025, we followed the instructions from the central economic and financial work conference and created a healthy balance sheet. And as for specific measures, we optimized the asset structure.

With the core assets reasonably growing, we have adjusted the structure of credit services, and we have doubled down our efforts to develop retail loans. And we expand our customer base through online services.

At the same time, we've flexibly arranged active liability tools to expand the source of capital. And we coordinated different financial products so we can keep the market-leading level of NIM.

And we continuously improve our capability in financial services and increasing the contribution from noninterest income. In the credit cost, operational cost, we have improved our level in lean management and our all-cycle management model, and we have seen the common business model and the customer needs in the market.

We will offer targeted services to build our differentiated capabilities, so we can create an ecosystem that meets the customer needs and we can upgrade the financial services targeted at specific industries so we can be an inevitable part of people's life so we can build close loops to maximize the benefit.

Thank you, Mr. Zhang.

Now a question from Hong Kong.

From JPMorgan, Katherine Lei. I have a question in your loan services.

In 2024, there was very stable expansion of loan services in 2024. Can you please specify which sectors where these loans targeted?

Can you please give us a prediction of the loan growth for 2024-2025 and the possible target sectors?

President Zhang, please?

Thank you, Ms. Lei.

In 2024, according to regulatory requirements, we expanded our markets and serve our customers. So in total amount and structure, we have realized a balanced development.

We support the physical economy, and we also have an increase of RMB1.98 trillion of loans, and it is increased by 9.83% is also leading in terms of the loan issuance. We also allocated different types of loans for the personal residential loans and mortgage loans and also consumption loans and also credit card loans and also all the individual loans, we are all in the leading position in the market.

In terms of the individual personal housing loans, we are also maintaining a very leading place in terms of the incremental segment. In terms of inclusive loans, the balance is RMB3.4 trillion.

We are still in the very leading place in the market and also the yield of these loans are also leading in the industry. So it is the foundation of our business.

And we also increased emphasis on the key industries and the sectors, especially those key areas of the physical economy like technology, green and manufacturing all realized double-digit growth and the balance of the -- accumulated credit for the stock buybacks is RMB8 billion. And also the manufacturing is also RMB3 trillion and with a growth rate of 12.5%, we also try to enlarge our advantage in the traditional loans.

In terms of the infrastructure and especially in the energy, we also realized double-digit growth in terms of hydro power station and also some other infrastructure-related infrastructure, there is also new increment loans. We also try to guarantee the delivery of the real estate.

And we also increased the property loans by RMB544 million, which is equivalent to the results of the year before. For the Tianjin, Beijing, Hefei region and Yangtze River Delta and also the Peal River Delta also increased their loans.

So this is the structure of the loans of last year. In 2025, we will also accelerate the accommodative physical policy, and we will also use technology to lead the economic growth and also the private economy will also have increased support from us, we will also try to meet the demand of the loans and to serve the economy.

First, we will also have five pillars focusing on the high-tech companies and the innovation pain points continue to deepen the financing systems and framework to these high-tech companies and try to identify more targets for loans so that various high-tech companies can get differentiated demands met. And secondly, we will focus on energy industry and transportation in terms of the green loans, continuously improve our assets green bond essence.

And we will also satisfy more SME's lowering demand and in terms of the mid- to long-term loans of these and also the small- and medium-sized enterprises. And we also have to ensure the quality of the assets is controllable.

We also will focus on the pension loans and build up the pension industry to be the priority for our loan issuance, try to resolve the pain points of the public in terms of the pension and the aging needs. And we try to be -- make all these measures and approaches more approachable and also accessible.

We also will enhance the priority areas. Our bank -- actually, the infrastructure is our advantage traditionally.

And we will also focus on our key strategies on this infrastructure industry. We will focus on the loans to the key strategic infrastructures projects, including the key residential and also property and real estate development and especially to the SMEs and the micro loans and also support the private economy to develop at a high speed and also guarantee that they can get stable and effective loans from the bank.

We will also do a good job in retail banking. And also in terms of the property developments, we need to give a full play to our traditional advantage, and we also should promote the consumption economy.

So that is in response to the national strategy. We try to accelerate the upgrading and the renewal of the consumables to ensure that the consumption economy can keep a leading way.

Thank you, Mr. Zhang.

Now is to turn of the Beijing venue. The gentleman on the right, in the third row.

I'm from Guangdong Development Securities. My Question is about the net interest margin.

And we know that CCB is also leading in the industry in terms of these net interest margin, and we know that last year, there were various changes in terms of the pricing and also there was some changes in the loan issuance and what are the impact of all these changes in terms of the policy changes? And will the pension or the pressure be relieved this year in terms of the net interest margin?

I will answer this question. As mentioned by Mr.

Zhang, in 2024, our NIM is 1.51%. We are leading in our industry in this regard.

So what are our approaches? We do try to balance the relationship between the total volume and also structure.

So we try to optimize the structure while controlling the overall scale. And in terms of the maturity, the product, the region and the customer, we continue to optimize the structures.

There are generally three aspects. First, optimize the asset allocation.

In recent years, we continue to reduce the low-yield percentage. And last year, we still maintain that momentum.

We also increased the percentage of the loan and also the bonds. Last year, the higher yield loans and bonds investment accounts has been released.

It has been increased by 1.3 percentage points. We also actively responded to the national government's call.

And in terms of the local loans, we have increased our input and these loans actually only takes up a small percentage of a loan and the yield is relatively high. So actually, our declining rate is less than the rate of the national bond.

So it has helped us in terms of the net interest margin. And in terms of the overseas institutions, we also strengthened our guidance and instruction in terms of the pricing and also the control.

And we also optimized the liability structure in two aspects. For the over two-year maturity products, we exercised effective control.

In the meantime, we also enhance the control of the low interest products. So through this optimization, we effectively control the cost of such loans.

So our liability and the interest of this liability has been greatly reduced on a Y-o-Y basis and that's why we have maintained a very good NIM's level. And we also exercised the linear management and effective tools to manage the pricing.

For the pricing management matter from the asset of liabilities, no matter private or public, we can have a very targeted management to each individual client, so that our loan yield and also the savings interest rate has all been maintained at a leading level in the industry. And these years, we can see the savings have been reduced -- have been on the decline.

And there is also -- we should -- a balance between various factors. The savings interest rate is on the decline in the past years.

It kind of catch against the impact from the decrease of property loans. And we also have a relaxed physical policy.

And if -- for this year, we think that NIM still has some pressure given all these policy changes and the market changes. So for the next stage, we will enhance our optimization of these structures and also the pricing system management.

We are confident that our NIM will be maintained at a very competitive level in the industry. Thank you for your question.

Next, I will invite the Hong Kong venue to raise questions. The lady on the right hand.

Thank you. I'm from [indiscernible] newspaper.

I want to ask about the quality of asset. From last year, the retail loan risk of the whole banking sector is on the rise.

What measures you came up with? Do you have any confidence to maintain a very premium asset quality management this year?

I will invite Vice President, [indiscernible], to answer.

In 2024, we tried to secure a very balanced and steady loan and enhance our risk control ability. We continue to optimize our risk control system.

Our overall risk control is in a more orderly way and in a more intensive and controllable way. Just as mentioned by Mr.

Zhang last year, our NPL ratio and also the provincial rate and the related figures have been maintaining at a good level. In recent years, the retail loans risks are on the rise and the NPL rate of the banking sector is also on the rise.

As a big bank and also big bank in retail business, we have accumulated a very rich experience. So our overall NPL ratio in the retail sector is at a low level and it has been reduced actually by 0.36 percentage points.

So compared with the whole sector, we are at a leading place. And given the risk challenges in the market, well, we -- referring to our experience, we also try to innovate and try to figure out new ways to control the new challenges.

We will monitor the risks and we also have the early warning system and try to optimize the risk control framework, optimize the procedures and increase the efficiency. And for the incremental business, we also have various measures like accelerating the upgrading of our products and also optimization of our customer services.

In 2025, we will resolutely implement the instructions from the state council and actively address risks, especially in real estate sector. We will enhance our capabilities of a risk mitigation so as to improve our work efficiency.

We will continuously optimize the credit structure and work on five areas, strengthening our services in major strategic areas with a higher quality of services, we will lay a better foundation for high-quality development. We will optimize our risk management system, and we will promote the internal risk control system, so we can control the see-through management of risks, both in overseas institutions and subsidiaries.

For asset quality, we will start early and nip in the bud in different risks by identifying different characteristics of different sectors, so we can coordinate different business lines and play the role of overseeing the whole system. We will also address the risks, especially in key areas, sectors and regions so we can take diversified, the targeted and differentiated approaches to mitigating risks.

We believe with the economic recovery in China with more favorable policies from the government, in 2025, we are confident that we can keep stable asset quality with key metrics being in the reasonable range with sufficient capability in supplementing risks.

Next question comes from Beijing.

Thank you for the opportunity. From BOC Securities.

I have a question regarding investment and financial markets. At the Central Economic Work Conference, fiscal deficit and long-term special treasury bonds were mentioned.

I'd like to ask CCB if you will double down on this front and what are the possible changes in your financial market services?

Mr. Ji will take the question.

Thank you for the question. In 2025, the government made it clear that more accommodative monetary policies and active fiscal policies will be carried out.

And in 2025, deficit -- in 2024, we note that RMB22 trillion of local and treasury bonds were issued. CCB has been the main underwriter of local and treasury bonds.

We work with the government in carrying out this fiscal policies, accommodative policies to boost economic recovery. Treasury and local bonds have been among our main investment in 2024.

For the first time, we underwritten over RMB1 trillion treasury bonds. And we also underwrote a market-leading level of local bonds.

In 2025, we will work on four aspects. We will remain our role as the main underwriter, enhancing our capabilities of underwriting, local and treasury bonds.

In 2024, the percentage of bonds accounted for 25.6% in our total assets. And in 2025, we will enhance our efforts to issue special treasury bonds and special local bonds targeted at infrastructure and other policy focuses, we believe that the percentage of loans of bonds will increase in total assets.

Secondly, we will make good use of the funds, both on and off balance sheet and enhance our efforts in credit bonds so we can make good use of our advantage in risk mitigation in order to build a multi layered diversified bond market working on five major areas. We have more bonds for technological companies and green areas, and we will increase the issuance of credit bonds will be a better distributor of bonds, so more private investors will invest in government bonds.

As a major bank, we have a huge network of financiers, and we have offered bond distribution services to hundreds of financial institutions. And in 2024, we distributed over RMB400 billion of bonds.

Going forward, we will enhance our capabilities of bond distribution increasing bond transaction volume targeting at medium and small institutions. Fourthly, we will be a good market maker.

Now our market maker services include interest rate bonds, credit bonds, derivatives and other products. In 2024, our bond transactions increased by 60%.

We believe there will be a major increase this year as well. We will further increase -- we'll further enhance our capabilities of pricing and the transaction.

So we can be an important bank in price discovery and improving market liquidity. And for your information, in 2024, CCB was designated as the bank for mutual recognition and connectivity of bonds in China and the UK.

We will make use of different channels, including the bond connect, so we can offer high level financial services to overseas investors holding RMB bonds. As for investment strategies, we have established a rather complete bond investment strategy systems, and we are also optimizing the system from time to time.

Since this year, there has been some market volatility and the market has stabilized in recent days. We have kept a close eye on market dynamics.

We will enhance our research and prediction of the market trend, so we can take a more proactive approach to investing in bonds, balancing revenue and risks, so we can set up a system geared towards economic added value. In account management strategies, we will make some due adjustments.

We will dynamically adjust different categories of assets, and we will increase the proportion of some public asset classes so we can improve our capabilities in investment research for a robust market.

Next question from Hong Kong.

Thank you, management. Gary from HSBC.

My question has to do with non-interest income. This year, for the whole year, the growth of your commission income improved compared with the first three quarters.

Could you please tell us what the drivers were? And was there some growth in your agency services in quarter four?

And among other non-interest income items, have they contributed positively to your profit?

Mr. Liu, General Manager of Financial and Accounting Department, will take the question.

Thank you. In 2024, the non-interest income was RMB138.7 billion, an increase of RMB10.3 billion, up by 8% and non-interest income was 19% and 1.8 percentage points year-on-year.

Commission income. In 2024 commission income was RMB104.9 billion, down by 9.35%, in line with the industry trends.

Despite the pressure in income, we have seen some positive changes. First of all, better revenue margin.

The whole year's decline has narrowed by 0.9 percentage points compared with the first three quarters. And in Q4, there was a 5% narrowing.

And in Q4, we realized positive growth. In product offering in September, market was boosted by favorable government policies.

We took the opportunity and we saw three months of continuous growth in equity-based funds. We have seen a higher proportion of premiums from our insurance business, a year-on-year increase of 6%.

Secondly, we have seen the proportion of commission income being 14.4% in total assets -- in total revenue. In consumer finance, wealth management and other new areas, this -- revenue from these new areas accounted for 60%.

Thirdly, we have a more stable customer base. We have 7 million new wealth management customers, an increase of 2 million.

The total number of credit card holders exceeded 100 million with more active customers. Custody services have surpassed RMB3 trillion for the first time.

The total size was RMB23 trillion. In our industry, we have implemented over 200 M&A projects, an increase of 30% year-on-year.

In 2025, we have formulated active development targets. We're going to see three opportunities.

Number one, consumer market, we will go around consumer market trends, we will enhance our efforts to develop services like credit cards, online payment, et cetera. Secondly, we will seize the opportunities of wealth management and investment diversification.

We will double down our efforts to promote wealth management fund and insurance. We will serve the real estate, and we will offer cost calculation, consultant services, guarantee, letters, financial services, advisories and other services and increase their contribution to commission income.

Secondly, for other noninterest income. In 2024, the revenue was RMB33.8 billion, an increase of RMB21 billion.

We seized the market opportunities to optimize the financial asset structure with more financial investments and transaction services. Secondly, we have better control in insurance structured deposits and the expenses have seen year-on-year decrease.

In 2025, we will dynamically optimize the structure of equity investment bonds and derivatives. We will enhance our management of liability cost to realize stable income from non-interest channels.

Thank you, Mr. Liu.

Another question from Beijing.

Thank you, management. From [indiscernible].

I have a question regarding personal mortgage income, mortgage loans. China's government introduced some policies to support people's purchase of homes, have you seen some changes in the needs from a personal home buyers in 2025 with the adjustments in mortgage loan rate?

Was there any prepayment? And in this market, how do we mitigate the risks in mortgage loans?

Thank you for your question. Actually, the personal housing loans are our traditional advantage, and it is also one of our key areas to serve the people.

So thank you for your attention to this issue. Just now our President Zhang also give a briefing.

And actually, our balance of the personal housing loan is RMB1.19 trillion. Actually, we are the number one in terms of the inventory of personal housing loan.

Last November, the Central Government meeting also issued a series of policies to support the development of the property market like reducing the loans ratio and also reduce administrative and procedural fees, et cetera. So there are some positive changes in the property market.

From our bank side, the loans application of personal housing has been on the rise significantly. Actually, last year, our average application received has a Y-o-Y increase of 73%.

There's a Y-o-Y increase of 35%, it increased by 73%. And also, the application acceptance and also the issuance has also maintained a very good momentum.

So we have laid a very solid foundation for the development. In terms of product structure, there also some changes.

For the secondhand house loan, it also grows steadily, and the percentage also is increasing. And given the very active market, actually, it is a positive correlation.

And in some key cities for the new properties, the loans are also increasing very fast. So it's also create a very good environment for our loans.

And now the demands of the people are more and more diversified, so they are pursuing better living and they want to improve their living status or their different -- or their living environment. So there are many demands that involve the upgrading of the existing apartments or living housing.

So we also have this slogan, If you want to buy an apartment, then come to CCB. So we need to guarantee the diversified needs of the people and come up with more convenient services and support the -- these kind of mandatory demands from the people.

And some people also prepay the loans in advance. And we can see that the spread of the interest rates has also been reduced and the pressure of the people has also been reduced in terms of the loan pressure.

So in terms of the prepayment, it has also reduced by 6.6%. And also in this year, it continued to be reduced in the first quarter of this year.

So this year, we will continue to improve the efficiency of the business procedures. Of course, there are various influencing sectors impacting on the market adjustments.

So there are also bigger pressure in terms of the personal housing loan risk control. So while exercising the implementation of various related policies, we also need to enhance the risk control measures.

And we can see that exposure actually has been controlled. And the quality of such personal loan is quite stable.

The NPL ratio is 0.63%. Compared with the industry, we are at a relatively very good status and our risk is relatively controllable, in general.

And for the next stage, we will also optimize the rate payment plans so that the pressure of our clients to repay the loans will be alleviated. We will also optimize the alarming system and also some big data of the new property states and various digital tools to improve our risk control level, and we'll also adopt various measures to enhance our capacity to deal with the nonperforming loans, so that our overall asset quality will be maintained at a stable level.

Thank you.

Now we will -- it's the Hong Kong side to raise questions. The gentleman on the fifth row on the right hand.

I'm from Phoenix TV, I'm [indiscernible]. We want to ask about ESG.

We have seen that in the MSE ESG rating, you got the highest rating, which is a AAA. Actually, you are the only banking -- banks in the whole world to have such a triple rating.

And now many investors are also very attentive to this ESG performance. So what is your plan for the next stage in terms of ESG work?

Okay. We will invite [indiscernible] to answer.

Actually, the ESG philosophy well, would pursue the social, economic and environmental benefits. The essence is consistent with the requirements of China's modernization needs and also our development philosophy, which is human-centered.

In recent years, CCB has also been implementing these development philosophies and principles, put the key essence and elements of ESG into our framework of development, continue to identify the ESG key factors and improve the analysis and assessment of these factors and formed a loophole -- closed-loop management procedure. And last year, our rating continued to be raised to be the leading -- the world's leading level.

Just now you mentioned -- actually in President Zhang's presentation, we -- it is also mentioned that we are the only top 10 banks to receive the AAA rating, and we are the only Mainland bank to have that award. I think it is attributed to four aspects of our efforts.

First, in terms of governance, we continue to improve our management system with the Chinese characteristics, identify the accountability and roles of the management in ESG, and we also construct a long-term working mechanism for synergy. And in terms of executing the ESG work, we also made various instructions and guidelines.

We also have a very detailed targets to reach, and there is a very clear road map to reach those goals. We also raise awareness about ESG across the whole bank.

So through these measures, we have a top-down approach to enhance the governance system in our bank, so all these have laid a very solid foundation. Secondly, in terms of the environment, we also have deepened our green finance work, and we also make full play to our multi-license advantage and enhanced our green finance product innovation system and also services.

And there, we also increased -- realized growth of 20.99% in terms of green finance. We also continue to improve the ESG risk control system in terms of differentiated credit authorization policy and also categorization of different risks.

And we also have our own low-carbon operation. This is one of the key links to construct an eco-friendly bank.

We also have the paperless procedure and policy. And we also have an internal carbon emission management system inspection to review our carbon reduction work effectiveness in a very timely way.

And we also have a Scope 1 and Scope 2 data disclosure, continue to expand our own business. And for the Scope 3 data, we also continue to improve our disclosure work.

And thirdly is about the social aspect. We are actively extending our inclusive finance to serve the general public.

In terms of pension finance, we have the first batch of 60 Jianyang An pension finance. And we make full play to advantage in terms of extensive outlets and combine that with the community pension and the aging population service.

And we also stick to the customer-centered principle to listen to the voices of the customers or KYC, and we continue to improve our system and also the management framework, have the regular inspection and also various examination of our own work, and we also conduct various training. We also regard our staff and employees as our most valuable assets.

We organize various trainings and activities and our satisfactory of employees has been maintained at a very good level. The fourth aspect is regarding the information disclosure.

And actually, CCB is a listed company, and we are closely following the ESG regulation policies, and we continue to improve the information disclosure system for ESG and we also refer to the international standards to improve our own work, and we also try to satisfy the demand of various stakeholders. And we also attach high importance to the regulatory body's advice to CCB's work on ESG.

In terms of disclosure and execution, we continue to strive to improve our ESG work, so that it can also help our high-quality development. Since last year, the governments, regulatory bodies and Hong Kong Exchange continue to issue ESG policies and the regulations.

There are clearer targets to reach. For example, climate change and opportunity management and the sustainable financing -- financial impact and the financing Scope 3 data, et cetera.

So, we will focus on these new issues and arrange our work. For the next step, we will continue to explore the high-quality development.

And in terms of ESG, we will also combine that with our five priorities, and we will also make a steady progress in this regard.

After the results have been announced, a hotline has been set up for answering your questions. This results announcement press conference is also live streamed on the Internet.

I received a question from the Internet. This question has to do with the use of DeepSeek, the AI model.

The question is, will CCB consider using DeepSeek and relevant technologies to advance the digitalization of the bank? Can you please talk about the case studies where the technology is applied?

Thank you. Thank you to our customers who have been supporting the development of our bank.

CCB has attached great importance to the research, development and application of AI and relevant technologies. It's been long since we started using AI in recognizing financial documents, tax and in smart recommendations.

We have received very good feedback. In 2023, with more developed large language models, we started using these large models in financial industry with our talent and high-quality financial data, we conducted pretraining, fine-tuning and enhanced learning of our open source model.

We developed a financial large language model catering to our bank's size. These large language models include large language model, image generation, code and programming and multi-model large language models.

They can be applied in different scenarios without affecting the current systems in place in our bank, we can shift to these underlying large models anytime. Up until the end of 2024, we tested 16 versions of financial large models.

This enabled us to catch up with the iterations of financial large models. So we can achieve higher performance in different business lines.

Our financial model participated in our internal qualification examinations. The examination included 62 subjects and the average grades of the large models achieved a 20 mark higher result than our human employees, and it has achieved the highest grade in 22 subjects.

That means these large financial models have a very good understanding of the specific knowledge to our financial sectors. By the end of last year, the computing power of GPUs for our large models in our bank accounted for 23.39% of the total computing power in our bank, guaranteeing the need for training of large financial models.

Last December, DeepSeek launched its new model. And since the open source DeepSeek large language model was made available, we started fine-tuning of the DeepSeek model with our financial data.

In February this year, DeepSeek was deployed in our working environment. It elevated the level of application and performance across the bank.

Up until now, applications of large financial models have covered half of our employees, 46 business lines and over 200 scenarios. For example, generation of worksheets and in credit risk management, large models help to generate customer due diligence reports and in payment and settlement, smart translation of documents and in custody, extraction of dividends of funds, and in IT, R&D checking code.

These scenarios have greatly improved the working efficiency of our employees and have helped mitigate risks. For example, in credit approval, these models can leverage on the chain of thinking of our financial experts to analyze the financial status of our corporate customers to automatically generate high-quality financial analysis report, and this has addressed the pain point of the lack of financial analyzing capabilities of our customer managers.

And this has allowed us to compress our work, which took several days to only a few hours. Another example is that in personal finance, we can combine big data and large financial models.

We can extract customer profile and customer description from a huge amount of data for analysis and thinking with our large financial models so that our customer managers can approach to our customer needs in every link in the service process. So the duration of marketing effort has been reduced from 30 minutes to only five minutes on average.

These large models can also help our employees improve their productivity. Our bank has produced AI assistant, AI toolkits and code explainer and vector knowledge base among other applications.

These basic applications have been made available to the whole group, and they can benefit the frontline staff across the bank. So these large financial models can reduce the burden on employees.

For example, AI toolkits supported our employees and allowed them to make work plans in a visualized way. This can help them approach -- this can help them solve some specific problems in their day-to-day work.

For example, automatic generation of a due diligence report for inclusive loans and the generation of notice for asset transfer and loan calls and also checking the procurement contract. So at present, employees across the bank have developed thousands of items of different capabilities, and the number is increasing day by day.

Code explainer can -- with the use of prompt, the code explainer can make use of the programming codes generated by financial large models for data analysis, so they can immediately meet the needs of our employees for data. The model can automatically program and analyze the results.

Well, what I'm talking about has nothing to do with professionals. And these applications can only be carried out by our frontline layman staff without any background in computer sciences or software development.

With the minimum training, they can highly efficiently solve problems in their day-to-day operation. We attach great importance to security, compliance and right values when using large language models.

We comply with the strict safety and security compliance standards, so the content generated by these large language models are controllable and credible through integrating vector knowledge base and search results from external sources, we can, to the largest extent, minimize large language model and AI hallucination. In the future, AI will play a key role in optimizing business performance and redefining customer services.

So CCB will continuously advance the development application of financial models in a prudent and cautious way. Thank you.

I'm sorry, our press conference today will probably overrun a little because we had a long answer for the question about DeepSeek. Now we will take another question from Beijing.

Thank you for the opportunity. Good afternoon, management.

From Shanghai Securities Daily. With lower deposit interest rates, all the banks have seen decline in the growth rate of deposits.

Do you have any measures to stabilize deposits and will there be any improvement in the stabilization of deposit interest rates?

You have asked two questions. One is about our differentiated strategies.

And the second, our long-term strategies. As for differentiated strategy, first, we will enhance our customer services.

And Mr. Zhang mentioned our strategy is to build an ecosystem and customer scenarios.

And on the other side, we need to work on supply chain and industry chain. So through digital technologies, we can make good use of our complete financial services and work on every type of customers to offer more products in the pipeline to meet the customer needs and improve on our operational efficiency.

As Mr. Zhang said, this strategy has allowed us to strengthen our customer base.

By the end of 2024, we recorded 680,000 corporate customers and personal customers reached 770 million and this undoubtedly put us at the leading position in the market. Secondly, as for the ecosystem and supply chain, we connect customers through the flow of information, funds and data.

So, last year, we targeted at the customer connection to build the closed loop of funding in the companies that we serve. Number three, we enhanced our product offering to governments, businesses and personal customers.

We offer enterprise-level computing network. Specifically, we offer different types of products to different customers.

For example, payroll services and integrated services for both corporate and personal customers, so we can receive revenue at a low cost. We also optimized the structure of assets and liabilities, so we can keep the level of diversity when it comes to liabilities.

As for long-term strategy, indeed, since the second half of 2023, we have enhanced our control of long-term deposits. We adjusted structure and improved on quality.

The strategy has worked very well. As for current trends, by the end of 2024, time deposits and the current deposits both grew by 5.24% and 1.3%.

These were in line with the growth of M2 and M1, M2 up by 7.3% and M1, 1.3%. So our time deposits was lower than M2, in terms of growth, and our current deposits lower than M1.

If you look at the ratio between time and current deposits, our current deposits accounted for 40% in our daily deposit, leading the market last year. The percentage of current deposits was up by 0.07 percentage points compared with the first half of the year.

As for time deposits, we have been focusing on these high interest deposits with longer terms, like three years or above. This type of loans accounted for 28.8% compared with 2023.

There was an increase of 4% -- there was a decrease of 4%. And the new deposits -- as for the new deposits, our interest rate has not changed much.

Overall speaking, for our deposits control responding to the market changes are also a result of our linear management efforts. So that's all of my answer.

Next, I would like to invite the Hong Kong side to raise questions. The lady on the fourth row on the left-hand side.

Thank you. I'm from Huatai Securities.

I'm Shen Juan. I want to ask a question about the real estate market.

We noticed that since last year, the national policy has been rolled out for supporting the real estate sector. So we want to know your arrangements and your supportive direction to respond to that policy?

And we also want to know how is your risk control in terms of real estate sector?

We will invite [indiscernible] General Manager of Credit Management Department to answer.

Thank you for your question. In 2024, the Central Government has rolled out a series of policies, and also, there is a policy from policy bureau to support the real estate sector.

There were four councils and two reductions, and the results are also emerging from these measures. CCB has actively implemented all the policies to support the steady and healthy development of this sector.

We also enhanced our risk control in this sector to ensure that the risk is controllable. We support the steady and healthy development of the sector.

First, we implemented the financing coordination system. That is the white list.

And in our head office, provincial and regional offices, we simply find the procedures, improve the efficiency so that as long as we can issue the loans, we will issue them. And in the meantime, we also enhanced our three priorities like those guarantee projects.

And apart from that, CCB in terms of personal housing loans and also the accumulative fund loans, we also enhanced our services in that regard. And in terms of the overall asset quality control, we also improved our measures.

We try to identify the early warning -- or try to enhance our early identification and the monitoring of some risks and the potential risks, and we have achieved some results, the NPL ratio and also the NPL scale has been reduced for both sides. And for the NPL rate, it has been reduced by 0.85 percentage points.

For next stage, we also will execute a series of policies to serve the existing and new incremental segments of this sector.

Okay. Actually, it has already been 1.5 hours.

We will take the last question. We'll leave it to the Beijing venue.

Okay, the lady.

Thank you. I'm from CICC.

I'm a banking sector analyst at [indiscernible]. We noticed that you increased interim dividend.

What -- how can we understand your dividend policy?

Okay. We will pass this question to Liu Fanggen from the accounting department.

In 2024, we have a dividend of RMB0.43 per share. And the total scale is RMB10 billion and the interim dividend is totaled at RMB49.25 billion.

The dividend per share is RMB0.197. And the dividend has all been issued before the spring festival of 2025.

We always attached great importance to the return to the shareholders. We will continue to use the dividend to return to our shareholders.

We will take a comprehensive consideration of the willingness of the shareholders, the supplement to the capital and balancing the regulatory regulations and sustainable development. So, in the future, we will continue to improve our comprehensive management level and create greater value for our shareholders.

Thank you. That's all for the Q&A.

We thank you all for your participation in person and also online. Thank you all, including the investors, analysts and the media friends.

We have had very frank and open communication, so that you can understand our strategic moves, our policies, and also our next arrangements and plans. So, maybe some of your questions are not included, so you can contact our Board of Directors' office and Investors Relations department.

That's all of our announcement. Hope you good health and a very good day.

Thank you.