China Merchants Bank : ·Annual Report 2015

ffb032ed-5e0e-4f99-a847-99acb8c2ff95.pdf

Stock Code : 03968

2015 Annual Report

We are here

Just for you

China Merchants Bank Annual Report 2015

Contents 1

Contents

1. Important Notice

2. Definitions

1. Significant Risk Warning

2. I Company Information

11 II Summary of Accounting Data and Financial Indicators

14 III Chairman's Statement

18 IV President's Statement

22 V Report of the Board of Directors

1. 5.1 Analysis of Overall Operation

2. 5.2 Analysis of Income Statement

32 5.3 Analysis of Balance Sheet

42 5.4 Loan Quality Analysis

48 5.5 Analysis of Capital Adequacy Ratio

51 5.6 Results of Operating Segments

53 5.7 Others

53 5.8 Business Development Strategies

57 5.9 Changes of the External Environment and the Corresponding Measures

67 5.10 Business Operation

85 5.11 Risk Management

93 5.12 Profit Appropriation

95 5.13 Social Responsibility

95 5.14 Key Relationship with Stakeholders and Environmental Policies and Performance

95 5.15 Management Contracts

1. 5.16 Permitted Indemnity Provision

2. 5.17 Compliance with the Relevant Laws and Regulations

3. VI Important Events

108 VII Changes in Shares and Information on Shareholders

116 VIII Directors, Supervisors, Senior Management, Employees and Organisational Structure

135 IX Corporate Governance

1. X Report of the Board of Supervisors

2. XI Documents Available for Inspection

3. XII Financial Report

2 China Merchants Bank Annual Report 2015

Important Notice

Important Notice

1. The Board of Directors, the Board of Supervisors, directors, supervisors and senior management of the Company confirm that the contents in this annual report are true, accurate, and complete and have no false representations, misleading statements or material omissions, and they will individually and collectively accept legal responsibility for such contents.

2. The 45th meeting of the Ninth Session of the Board of Directors of the Company was held at the China Merchants Bank University, Shenzhen from 29 to 30 March 2016. The meeting was presided by Li Jianhong, Chairman of the Board. 13 out of 16 eligible directors attended the meeting in person. Tian Huiyu (Executive Director), Fu Gangfeng (Non-Executive Director) and Zhao Jun (Independent Non-Executive Director) failed to attend the meeting because of business appointments, and entrusted Li Hao (Executive Director), Hong Xiaoyuan (Non-Executive Director) and Leung Kam Chung, Antony (Independent Non-Executive Director) to exercise the voting right, respectively. A total of 16 valid votes were cast. 5 supervisors of the Company were present at the meeting. The convening of the meeting complied with the relevant provisions of the Company Law and the Articles of Association of the Company.

3. KPMG Huazhen Certified Public Accountants and KPMG Certified Public Accountants (both being auditors of the Company) have separately reviewed the 2015 annual financial report prepared in accordance with the PRC Generally Accepted Accounting Principles and International Financial Reporting Standards, and issued standard auditing reports with unqualified opinions.

4. Unless otherwise stated, all monetary sums stated in this annual report are expressed in RMB.

5. Li Jianhong, Chairman of the Company, Tian Huiyu, President, Li Hao, First Executive Vice President and Chief Financial Officer, and Wang Tao, the person in charge of the Finance and Accounting Department, hereby make representations in respect of the truthfulness, accuracy and completeness of the financial statements in this annual report.

6. Proposal of profit appropriation: As stated in the audited PRC financial statements of the Company for 2015, 10% of the profit after tax of RMB53.189 billion, equivalent to RMB5.319 billion, was transferred to the statutory surplus reserve, while 1.5% of the total amount of the increased risk assets in this reporting period, equivalent to RMB10.720 billion, was appropriated to the general reserve. Based on the total share capital of A Shares and H Shares on the record date for implementation of the profit appropriation, the Company proposed to declare a cash dividend of RMB6.90 (tax included) for every 10 shares to all shareholders of the Company, payable in RMB for holders of A Shares and in HKD for holders of H Shares. The retained profit will be carried forward to the next year. In 2015, the Company did not transfer any capital reserve into share capital. The above proposal of profit appropriation is subject to consideration and approval at the 2015 Annual General Meeting of the Company.

7. We have included in this report certain forward-looking statements with respect to the financial position, operating results and business development of the Group. We use words such as "will", "may", "expect", "try", "strive", "plan", "anticipate", "aim at", and similar expressions to identify forward-looking statements. These statements are based on current plans, estimates and projections. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we give no assurance that these expectations will translate into reality or prove to be correct. Therefore they should not be deemed as the Group's commitments. Investors should not place undue reliance on such statements and should pay more attention to investment risks. You are cautioned that such forward-looking statements are related to future events or future financial position, business or other performance of the Group, and are subject to a number of uncertainties which may cause substantial differences in the actual results.

China Merchants Bank Annual Report 2015‌

Definitions / Significant Risk Warning 3

Definitions

Company, Bank, CMB or China Merchants Bank:

China Merchants Bank Co., Ltd.

Group:

China Merchants Bank Co., Ltd. and its subsidiaries

China Banking Regulatory Commission or CBRC: China Banking Regulatory Commission

China Securities Regulatory Commission or CSRC:

China Securities Regulatory Commission

China Insurance Regulatory Commission or CIRC:

China Insurance Regulatory Commission

Hong Kong Stock Exchange or SEHK:

The Stock Exchange of Hong Kong Limited

Hong Kong Listing Rules:

The Rules Governing the Listing of Securities on the SEHK

Wing Lung Bank or WLB:

Wing Lung Bank Limited

CMB Financial Leasing or CMBFL:

CMB Financial Leasing Co., Ltd.

CMB International Capital or CMBIC: CMB International Capital Holdings Corporation Limited

China Merchants Fund or CMFM: China Merchants Fund Management Co., Ltd.

CIGNA & CMB Life Insurance:

CIGNA & CMB Life Insurance Co., Ltd.

CM Securities:

China Merchants Securities Co., Ltd.

KPMG Huazhen Certified Public Accountants:

KPMG Huazhen Certified Public Accountants (Special General Partnership)

SFO:

Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

Model Code:

Model Code for Securities Transactions by Directors of Listed Issuers of Hong Kong Stock Exchange

Wing Lung Group:

Wing Lung Bank and its subsidiaries

Significant Risk Warning

The Company has disclosed herein the major risks involved in its operations and the proposed risk management measures. Please refer to Chapter V for the details in relation to risk management.