Bank of China Limited ("the Bank": Hong Kong Stock Exchange stock code: 3988; Shanghai Stock Exchange stock code: 601988; Shanghai Stock Exchange convertible bond code: 113001) announced its 2013 annual results on 26 March. According to International Financial Reporting Standard ("IFRS"), the Bank recorded a profit after tax of RMB163.741 billion and profit attributable to equity holders of RMB156.911 billion, increased 12.35% and 12.36% year-on-year respectively.

In 2013, adhering to the strategic goal of "Serving society, Delivering excellence", Bank of China focused on improving operating efficiency, actively expanded markets, accelerated structure optimisation, effectively controlled risks, and achieved sustainable growth in the complex operational environment.

Excellent performance in key financial indicators

As at the end of 2013, the Bank's total assets, liabilities and capital and reserves attributable to equity holders amounted to RMB13.87 trillion，RMB12.91 trillion and RMB923.916 billion, increased 9.41%，9.25% and 12.03% respectively from the prior year-end. Profit after tax grew faster than that of total assets, which boost the return on average total assets to 1.23%.Return on average equity stood at 18.04%. By proactively optimising asset liability structure, the net interest margin continued to expand. Non-interest income ratio continued to lead peers. The Bank's asset quality remained stable with sufficient provision. Its capital adequacy ratio, tier 1 capital adequacy ratio and core tier 1 capital adequacy ratio were 12.46%, 9.70% and 9.69% respectively, complying with the regulator's new requirements. Basic earnings per share recorded RMB0.56. The Board of Directors has recommended a final dividend of RMB0.196 per share for the year of 2013.

In 2013 the Bank has been listed in the Fortune Global 500 for 25 consecutive years and was enrolled as G-SIFI for 3 consecutive years, which demonstrate the Bank's continuous lift in the market recognition. The Bank's stand-alone credit profile was upgraded by Standard & Poor's rating agency and it was warmly welcomed by the capital market.

Optimised business structure and supported real economy

In 2013, the Bank efficiently stimulated institutions of different levels to realise self-development. The Bank continued to expand its customer base byactively seeking customers along the upstream and downstream of the supply chain and industrial chain, expanding its administrative institution customer base, promoting the core businesses such as wage distribution agency service and receipt and payment agency service. As at the end of 2013, the total customer deposits amounted to RMB10,097.786 billion, grew by RMB923.791 billion or 10.07% compared with the prior year-end, and the proportion to total liabilities increased by 0.58 percentage point. The domestic RMB-denominated customer deposits grew by RMB703.587 billion or 10.04% from the end of last year. By proactively and continuously reducing high cost liability, the average cost of domestic RMB and foreign exchange-denominated customer deposits dropped by 18 and 35 basis points respectively compared with last year.

Taking real economy service as the first priority, the Bank accelerated the transformation of its financial services for large enterprises and strengthened credit support to the SMEs and individual customers, to continuously optimise structure of loan portfolio. The amount of loans and advances to customers was RMB7,607.791 billion, grew by RMB743.095 billion or 10.82% compared with the prior year-end. The domesticRMB-denominated loans grew RMB484.503 billion, an increase of 9.56% compared with the prior year-end. Small enterprise loans by "BOC Credit Factory" grew by 32.00%, and domestic medium sized enterprise loans grew by 18.19%, with the proportions to domestic corporate loans up by 1.49 and 2.35 percentage points respectively. The domestic RMB-denominated personal loans increased 15.31% from the end of last year, and the proportion to domestic RMB-denominated loans reached 33.58%.

The Bank made proactive efforts to optimise its asset and liability structure and improve net interest margin. In 2013, net interest margin of the domestic RMB business and overseas business expanded by 10 and 15 basis points respectively, which drove the Bank's net interest margin up by 9 basis points from last year to 2.24%.

Adapting to customer demands,the Bank deepened business transformation, made greater efforts in product innovation and promotion and continuously optimised the structure of its fee-based businesses. In 2013, non-interest income recorded RMB123.924 billion, increased by 13.47% year-on-year, representing 30.41% of total operating income, an increase of 0.58 percentage point from last year. Agency commissions, bank card fees, settlement and clearing fees, custodian and other fiduciary service fees recorded rapid growth of 23.82%, 15.78%, 8.15% and 21.21% respectively.

Enhanced differentiated competitive edges and supported Chinese enterprises' "going global"

In 2013, the Bank stepped up the integrated development of its domestic and overseas operation and enhanced its differentiated competitiveness.The contribution of overseas business was remarkably increased. As at the end of 2013, the Bank's total overseas assets was USD630.844 billion, an increase of 26.46% compared to the prior year-end, and accounted for 25.76% of the Bank's total assets. Overseas profit before tax was USD6.663 billion, an increase of 20.55% year-on-year, accounted for 19.38% of the Bank's total profit before tax. Overseas customer deposits and loans maintained rapid growth, increased 16.50% and 22.09% respectively compared with the prior year-end. The Bank accelerated the development of diversified businesses including investment banking, insurance，direct investment and investment management, fund management and aircraft leasing business. In 2013, the Bank's non-banking business income recorded a year-on-year increase of 24.77% with the proportion to the Bank's operating income up 1.43 percentage points.

The Bank's global service network further improved. In 2013, the Bank established 11 new overseas institutions in 9 countries and regions in North America, Europe and Asia. The Bank had a total of 620 overseas institutions, covering Hong Kong, Macau, Taiwan and 37 countries. Traditional edges including international settlement, international clearing, syndicated loan grew robustly, maintaining leading position in the market. The Bank successfully supported WH Group Limited's acquisition of Smithfield Foods, and sponsored China National Offshore Oil Corporation's acquisition of NEXEN Energy UCL and other important projects, which significantly enhanced the Bank's influence in domestic and overseas markets.

The Bank maintained the leading position in RMB internationalisation process. In 2013, the Bank's cross-border RMB settlement volume was over RMB3.98 trillion, achieving an overall year-on-year growth rate of 60.15%. Since China launched its RMB cross-border settlement scheme, the Bank had completed cross-border RMB settlement volume of RMB8.6 trillion. Apart from Hong Kong, Macau and Taiwan, the Bank is also the RMB clearing bank of Malaysia, Luxembourg, Cambodia, Philippines, and has become the main RMB clearing channel in countries such as the UK, Germany, France, Japan, South Korea, Indonesia and South Africa. Since the second half of 2013, the Bank hadpublished the Bank of China Cross-border RMB Business White Paper， BOC Cross-border RMB Index and BOC Off-shore RMB Index worldwide successively, being the first Chinese financial institution to compile and release RMB internationalisation related white paper and indexes.

Strengthened infrastructure construction and promoted internet banking development

Focusing on improving customer experience and enhancing efficiency of its outlets, the Bank continuously strengthened network construction. It optimised distribution of its outlets and pushed forward outlet transformation, with nearly 2,000 middle to large-sized fully functional outlets been built up. The Bank further enhanced its e-banking channels, including online banking, telephone banking, mobile banking, self-service banking, home banking and Wechat banking. As at the end of 2013, the Bank's e-banking transaction volume reached RMB110.40 trillion, an increase of 20.83% compared to the prior year. The substitution ratio of e-banking channels for traditional outlets reached 77.53%. The Bank strengthened the construction of the e-commerce-centered E-finance bank, and successfully launched its  Open Platform and other innovative products such as "Micro Bank", "Easy Pay" and "BOC E-Community". The Bank also provided service solutions to SMEs via "BOC Online Tongbao", and put its first "Future Bank" flagship branch into trial operation. The Bank further improved information technology development, and steadily advanced the integration and transformation of overseas information systems. It accelerated the construction of global unified payment and customer service platforms，with the Bank's operational and service capability further improved.

Improved risk management system and enhanced comprehensive risk control

Adhering to the balance of safety, liquidity and profitability, the Bank improved liquidity management policy and method and enhanced its emergency handling capability to ensure the security of liquidity. The Bank also strengthened comprehensive risk management, enhanced controlling over lending to overcapacity industries, local government financing vehicles, real estate and other key industries. It earnestly implemented regular risk inspection, early risk warning, post-lending management to maintain stable asset quality. As at the end of 2013, the Bank's non-performing loans ratio was 0.96%，maintaining stable. Special-mention loan ratio was 2.49%, down 0.53 percentage point from the prior year-end. The Bank's provision was sufficient with its non-performing loans coverage ratio stood at 229.35%. The ratio of allowance for loan impairment losses to total loans for domestic institutions was 2.62%, maintaining the same level as that of the prior year-end.

Mr. Tian Guoli, Chairman of the Bank, said, "The year 2014 is a year of reform and expectation. The Bank will integrate its own development more consciously into the overall trend of economic transformation and social progress, deepen reform to promote development, strengthen innovation for more market shares, accelerate transformation for efficiency, manage risks to reduce cost and strive to shoulder social responsibilities in a bid to be an excellent bank and reward the trust and support of shareholders and public with more outstanding performance."

Mr. Chen Siqing, President of the Bank, said, "The year 2014 is expected to bring the hope of full recovery for world economy. China will embark on a new journey of deepening reform in an all-round manner. Adhering to the strategic goal of 'Serving society, Delivering excellence', the Bank will focus on business development, continuously tighten risk management for the sake of security, fully unleash the impetus for reform and innovation, and pay particular attention to the key task of team building, thereby bringing about the healthy development of all its undertakings and ushering in a new era of glory for the Bank."



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