6818) FIRST QUARTERLY REPORT OF

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1 Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. 中國光大銀行股份有限公司 China Everbright Bank Company Limited (A joint stock company incorporated in the People s Republic of China with limited liability) (Stock code: 6818) FIRST QUARTERLY REPORT OF 2018 The Board of Directors (the Board ) of China Everbright Bank Company Limited (the Company ) hereby announces the unaudited results of the Company and its subsidiaries for the first quarter ended 31 March 2018 (the Reporting Period ) prepared under the International Financial Reporting Standards. This announcement is made in accordance with Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and Rule of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. Beijing, the PRC, 27 April 2018 On behalf of the Board China Everbright Bank Company Limited LI Xiaopeng Chairman As at the date of this announcement, the Executive Directors of the Company are Mr. Zhang Jinliang and Ms. Li Jie; the Non-executive Directors are Mr. Li Xiaopeng, Mr. Cai Yunge, Mr. Zhang Shude, Mr. Li Huaqiang, Mr. Fu Dong and Mr. Zhao Wei; and the Independent Non-executive Directors are Mr. Qiao Zhimin, Mr. Xie Rong, Ms. Fok Oi Ling Catherine, Mr. Xu Hongcai, Mr. Feng Lun and Mr. Wang Liguo

2 I. IMPORTANT NOTICE China Everbright Bank Company Limited First Quarterly Report of The Board of Directors, Board of Supervisors and Directors, Supervisors and Senior Management of the Bank hereby warrant the authenticity, accuracy and completeness of the contents of this report and that there are no false representations, misleading statements or material omissions, and jointly and severally assume legal responsibility for the information in this report. 1.2 The Twenty-first Meeting of the Seventh Session of the Board of Directors of the Bank was convened on 27 April 2018, at which the First Quarterly Report of 2018 was considered and approved. 14 out of 14 Directors attended the meeting in person. Non-Executive Director Zhang Shude, Non-Executive Director Li Huaqiang, Independent Non-Executive Director Xie Rong and Independent Non-Executive Director Wang Liguo were authorized respectively in writing by Non-Executive Director Cai Yunge, Non-Executive Director Zhao Wei, Independent Non- Executive Director Qiao Zhimin and Independent Non-Executive Director Feng Lun who were not able to attend the meeting due to other official duties, to attend the meeting and exercise the voting right on their behalves. 5 Supervisors were present at the meeting as non-voting attendees. 1.3 The financial statements in this report were prepared pursuant to International Financial Reporting Standards ( IFRS ) and are unaudited. 1.4 In this report, the Bank, and the Company all refer to China Everbright Bank Company Limited, and the Group refers to China Everbright Bank Company Limited and its subsidiaries. 1.5 Mr. Li Xiaopeng, Chairman of the Board of Directors, Mr. Zhang Jinliang, President and Mr. Xie Rong, Independent Non-Executive Director hereby warrant the authenticity, accuracy and completeness of the financial statements in this quarterly report

3 II. BASIC INFORMATION 2.1 Key financial data Unit: RMB million Item 31 March December 2017 Change (%) Total assets 4,163,187 4,088, Net assets attributable to equity shareholders of the Bank 305, , Net assets per share attributable to ordinary shareholders of the Bank 1 (RMB) Item January March, 2018 January March, 2017 Change (%) Operating income 25,378 23, Net profit 9,071 8, Net profit attributable to equity shareholders of the Bank 9,051 8, Basic earnings per ordinary share 2 (RMB) Diluted earnings per ordinary share 3 (RMB) Return on weighted average net assets 4 (%) percentage points Net cash flows from operating activities (54,605) (163,506) N/A Notes: 1. Net assets per share attributable to ordinary shareholders of the Bank = (net assets attributable to equity shareholders of the Bank of other equity instrument)/total number of ordinary shares at the end of the period. 2. Basic earnings per ordinary share = net profit attributable to ordinary shareholders of the Bank/weighted average number of ordinary shares outstanding; net profit attributable to ordinary shareholders of the Bank = net profit attributable to equity shareholders of the Bank dividend of the declared for the reporting period. 3. Diluted earnings per ordinary share = (net profit attributable to ordinary shareholders of the Bank + effect of dilutive potential ordinary shares on net profit attributable to ordinary shareholders of the Bank)/ (weighted average number of ordinary shares outstanding + weighted average number of dilutive potential ordinary shares converted into ordinary shares). 4. Return on weighted average net assets = net profit attributable to ordinary shareholders of the Bank/weighted average net assets attributable to ordinary equity shareholders of the Bank, listed in an annualized form. The above figures were calculated according to the Compilation Rules for Information Disclosures by Companies that Offer Securities to the Public (No.9): Calculation and Disclosure of Rate of Return on Equity and Earnings per Share (2010 Revision) issued by the CSRC and the Interpretation of Accounting Standards for Business Enterprises (No.7) of the Ministry of Finance

4 2.2 Capital adequacy ratio and leverage ratio indicators The capital adequacy ratio (CAR) indicators of the Group as at the end of the reporting period calculated in accordance with the Capital Rules for Commercial Banks (Provisional) (Order No. 1 of the CBRC in 2012) are as follows: Item Unit: RMB million, % 31 March December 2017 Consolidated Consolidated Nonconsolidated Nonconsolidated Net common equity tier-1 capital 274, , , ,737 Net tier-1 capital 304, , , ,684 Net capital base 395, , , ,381 Risk-weighted assets 2,968,677 2,905,679 2,856,800 2,796,745 Common equity tier-1 CAR Tier-1 CAR CAR Note: All domestic and overseas branches, as well as invested financial institutions within the scope of consolidated management in accordance with the Capital Rules for Commercial Banks (Provisional), shall be included in the calculation of the consolidated CARs. Among these, the invested financial institutions within the scope of consolidated management include Everbright Financial Leasing Co., Ltd., Shaoshan Everbright Village Bank Co., Ltd., Jiangsu Huai an Everbright Village Bank Co., Ltd., CEB International Investment Corporation Limited and China Everbright Bank (Europe) S.A. All domestic and overseas branches are included in the calculation of the non-consolidated CARs

5 The leverage ratio indicators of the Group as at the end of the reporting period calculated in accordance with the Measures for the Administration of the Leverage Ratio of Commercial Banks (Revised) (Order No.1 of the CBRC in 2015) are as follows: Item 31 March December September 2017 Unit: RMB million, % 30 June 2017 Leverage ratio Net tier-1 capital 304, , , ,994 Adjusted on-balance sheet and offbalance sheet assets 4,801,440 4,698,240 4,621,816 4,643, Liquidity coverage ratio indicators The liquidity coverage ratio indicators of the Group as at the end of the reporting period measured pursuant to the Administrative Measures for Liquidity Risk of Commercial Banks (Provisional) (Order No.9 of the CBRC in 2015) as at the end of the reporting period are as follows: Item 31 March December September 2017 Unit: RMB million, % 30 June 2017 Liquidity coverage ratio High quality liquid assets 284, , , ,266 Net cash outflows in 30 days 285, , , , Differences between the financial statements prepared in accordance with the PRC Generally Accepted Accounting Principles ( PRC GAAP ) and those prepared in accordance with IFRS. There was no difference regarding the net profit from January to March 2018 and the net assets as at 31 March 2018 as presented in the Group s consolidated financial statements prepared in accordance with PRC GAAP and those prepared in accordance with IFRS

6 2.5 Analysis of operating results As at the end of the reporting period, the total assets of the Group posted RMB4, billion, representing an increase of 1.83% over the end of the previous year. The total liabilities registered RMB3, billion, representing an increase of 1.95% over the end of the previous year. The balance of deposits reported RMB2, billion, up by 3.22% over the end of the previous year. Total loans and advances stood at RMB2, billion, representing an increase of 4.24% over the end of the previous year. During the reporting period, the Group realized a net profit of RMB9.071 billion, a year-on-year increase of 5.49%. Its operating income registered RMB billion, up by 7.12% year on year. In 2018, the Group applied IFRS 9. In accordance with this standard, operating income generated from monetary funds, bond funds which were previously recognized in interest Income were included in other income such as net income arising from investment. Consequently, net interest income realized for the first quarter of 2018 was RMB billion. Calculated according to the standards applied in the last year, net interest income would reach RMB billion, up by 6.08% over year past, and net interest margin ratio would stand at 1.59%, up by 6 base points after income from business such as investments in funds were returned. During the reporting period, the Group s net fee and commission income was RMB9.314 billion, up by 13.47% year on year and accounting for 36.70% of the total operating income. During the reporting period, the Group incurred operating expenses of RMB7.318 billion, an increase of 8.27% year-on-year. Its impairment losses on assets were RMB6.960 billion, up by 26.87% year on year. As at the end of the reporting period, the non-performing loans of the Group totaled RMB billion, representing an increase of RMB1.363 billion over the end of the previous year. Its non-performing loan ratio was 1.59%, the same with the end of the previous year. Its provision coverage ratio was %. As at the end of the reporting period, the Group s CAR reached 13.32%. Its tier-1 CAR stood at 10.25%, while its common equity tier-1 CAR reported 9.24%, all of which meet the regulatory requirements. As at the end of the reporting period, the leverage ratio of the Group was 6.34%, down by 0.11 percentage point over the end of the previous year

7 2.6 Total number of shareholders and shareholding of top 10 shareholders as at the end of the reporting period are as follows: Unit: Share, % Total number of shareholders as at the end of the reporting period A Shares 226,258, H Shares 930 Shareholding of top 10 shareholders Name of shareholder China Everbright Group Limited Hong Kong Securities Clearing Company Nominees Limited, including: Overseas Chinese Town Group Company Limited Ocean Fortune Investment Limited China Life Reinsurance Company Limited Nature of shareholder Domestic legal person Number of shares Class of shares Shareholding percentage Number of shares pledged/ frozen 11,565,940,276 A Shares ,782,965,000 H Shares ,674,015,480 H Shares Unknown Domestic legal person Overseas legal person Domestic legal person 4,200,000,000 H Shares ,605,286,000 H Shares ,530,397,000 H Shares 2.92 Central Huijin Investment Limited State 10,250,916,094 A Shares China Securities Finance Corporation Limited China Everbright Limited China Reinsurance (Group) Corporation Shenergy (Group) Co., Ltd. Zhuhai Shipping Corporation Limited Central Huijin Asset Management Ltd. Yunnan Hehe (Group) Co., Ltd. Domestic legal person Overseas legal person Domestic legal person Domestic legal person Domestic legal person Domestic legal person Domestic legal person 1,759,066,966 A Shares ,572,735,868 A Shares ,094,619 A Shares ,393,000 H Shares ,002,403 A Shares ,999,875 A Shares ,693,300 A Shares ,063,556 A Shares

8 Notes: 1. As at the end of the reporting period, the billion H shares held by China Everbright Group Limited ( Everbright Group ) and billion H shares held by Overseas Chinese Town Group Company Limited were subject to selling restrictions, and all the other ordinary shares of the Bank are not subject to selling restrictions. 2. Statement on the connected party relations or concerted action relations among the aforesaid shareholders: The Bank was aware that as at the end of the reporting period, Central Huijin Investment Limited ( Huijin ) held 55.67% and 71.56% interest in Everbright Group and China Reinsurance (Group) Corporation, respectively; Central Huijin Asset Management Ltd. is a wholly-owned subsidiary of Huijin; China Everbright Limited is a subsidiary indirectly controlled by Everbright Group; China Life Reinsurance Company Limited is a wholly-owned subsidiary of China Reinsurance (Group) Corporation; Zhuhai Shipping Corporation Limited and Ocean Fortune Investment Limited are both subsidiaries indirectly controlled by China Shipping (Group) Company. Save for the above, the Bank is not aware of any connected party relations or concerted action relations among the above shareholders. 3. As at the end of the reporting period, the total number of H shares of the Bank held by the Hong Kong Securities Clearing Company Nominees Limited acting as the nominee for all institutional and individual investors that maintain an account with it was 12,674,015,480 H shares. Apart from the 4,200,000,000, 1,605,286,000, 1,530,397,000, 1,782,965,000 and 376,393,000 H shares of the Bank held by Overseas Chinese Town Group Company Limited, Ocean Fortune Investment Limited, China Life Reinsurance Company Limited, Everbright Group and China Reinsurance (Group) Corporation respectively, all of which were under the name of Hong Kong Securities Clearing Company Nominees Limited, the number of remaining H shares of the Bank held under the name of Hong Kong Securities Clearing Company Nominees Limited was 3,178,974,480 H shares

9 2.7 Total number of preference shareholders and shareholdings of top 10 preference shareholders as at the end of the reporting period Everbright P1 (Code: ) Total number of preference shareholders of Everbright P1 as at the end of the reporting period (shareholders) Name of shareholder Bank of Communications Schroder Fund Management Co., Ltd. China CITIC Bank Corporation Limited Chuangjin Hexin Fund Management Limited Nature of shareholder Changes in shareholding during the reporting period Number of shares held Percentage of shareholding 18 Type of shares Others 37,750, Domestic Others 17,750, Domestic Others 15,510, Domestic BOCI Securities Limited Others 15,500, Domestic Bank of Communications International Trust Co., Ltd. Others 15,500, Domestic Hwabao Trust Co., Ltd. Others 13,870, Domestic China Resources SZITIC Trust Co., Ltd. Others 13,870, Domestic CCB Trust Co., Limited Others 10,000, Domestic China Ping An Property & Casualty Insurance Co., Ltd. China Ping An Life Insurance Co., Ltd. Others 10,000, Domestic Others 10,000, Domestic Unit: Share, % Number of shares pledged/ frozen Note: China Ping An Property & Casualty Insurance Co., Ltd. and China Ping An Life Insurance Co., Ltd. have connected party relations. Bank of Communications Schroder Fund Management Co., Ltd. and Bank of Communications International Trust Co., Ltd. have connected party relations. Save for the above, the Bank is not aware of any connected party relations or concerted action relations among the above preference shareholders and between them and the top 10 ordinary shareholders

10 2.7.2 Everbright P2 (Code: ) Total number of preference shareholders of Everbright P2 as at the end of the reporting period (shareholders) Name of shareholder AXA SPDB Investment Managers Co., Ltd. Shanghai Wisdom Asset Management Co., Ltd. China Everbright Group Limited China Life Insurance Company Limited Postal Savings Bank of China Co., Ltd. Bank of Communications Schroder Fund Management Co., Ltd. Bank of Communications International Trust Co., Ltd. China Resources SZITIC Trust Co., Ltd. Nature of shareholder Changes in shareholding during the reporting period Number of shares held Percentage of shareholding 23 Type of shares Others 16,470, Domestic Others 13,090, Domestic Others 10,000, Domestic Others 8,180, Domestic Others 7,200, Domestic Others 6,540, Domestic Others 6,540, Domestic Others 3,680, Domestic BOCI Securities Limited Others 3,270, Domestic HuaAn Future Asset Management (Shanghai) Limited Others 3,270, Domestic Bank of Hangzhou Co., Ltd. Others 3,270, Domestic China CITIC Bank Corporation Limited Others 3,270, Domestic Unit: Share, % Number of shares pledged/ frozen Note: Bank of Communications Schroder Fund Management Co., Ltd. and Bank of Communications International Trust Co., Ltd. have connected party relations. China Everbright Group Limited is also one of the top 10 ordinary shareholders of the Bank. Save for the above, the Bank is not aware of any connected party relations or concerted action relations among the above preference shareholders and between them and the top 10 ordinary shareholders

11 III. SIGNIFICANT EVENTS 3.1 Material changes of major financial statements items and financial indicators and the reasons thereof Applicable Item Deposits with banks and other financial institutions Inapplicable 31 March 2018 Unit: RMB million, % 31 December 2017 Change Main reasons for change 29,062 44, Deposits with domestic depository financial institutions and nondepository financial institutions scaled down Derivative financial assets 6,854 4, Affected by changes in the exchange rate of RMB, positive valuation of some exchange rate derivatives increased Financial assets at fair value through profit or loss Financial investments at fair value through other comprehensive income Financial investments measured at amortized cost Available-for-sale financial assets Held-to-maturity investments Debt securities classified as receivables 268, ,422 24,196 1, N/A Affected by the implementation of IFRS 9, the reclassification of some assets resulted in adjustments to the items presented in the statements. 864,120 N/A 414,547 N/A 344,617 N/A 514,576 N/A Deferred tax assets 10,324 7, Deferred tax assets scaled up due to that the implementation of IFRS 9 increased provisions and changed valuation Other assets 30,313 17, The amount to be cleared increased Placements from banks and other financial institutions 141, , Placements from domestic depository financial institutions increased

12 Item Derivative financial liabilities Financial assets sold under repurchase agreements Other comprehensive income 31 March December 2017 Change Main reasons for change 8,583 6, Affected by changes in the exchange rate of RMB, negative valuation of some exchange rate derivatives increased 16,919 45, The bonds sold under repurchase agreements decreased. (272) (1,845) Affected by the implementation of IFRS 9, the changes in the fair value and provision for impairment losses of financial assets at fair value through other comprehensive income made other comprehensive income increased Item January to March 2018 January to March 2017 Change Main reasons for change Net trading gains/(losses) 162 (312) N/A Affected by the implementation of IFRS 9, net trading gains increased Net gains/(losses) arising from investment securities Net foreign exchange (losses)/gains Other comprehensive income, net of tax 3,462 (9) N/A Affected by the implementation of IFRS 9, net gains arising from investment securities from financial assets at fair value through profit or loss increased (303) 494 N/A Affected by changes in exchange rates, net foreign exchange losses increased 847 (1,095) N/A Affected by the implementation of IFRS 9, the changes in the fair value and provision for impairment losses of financial assets at fair value through other comprehensive income made other comprehensive income increased

13 3.2 Progress and impact of significant events and analysis and explanation of the solutions Applicable Inapplicable Second issuance of the On 28 February 2018, the Bank had the Proposal on Re-authorizing the Board of Directors to Handle the Relevant Matters Relating to the Domestic Private Placement of Preference Shares of the Bank reviewed and approved at the 2018 First Extraordinary General Meeting which coincided with the 2018 First A Shareholders Class Meeting, 2018 First H Shareholders Class Meeting and 2018 First Preference Shareholders Class Meeting, with the re-authorization term of 12 months since the resolution of the Shareholders General Meeting came into force. The relevant matters are in progress. 3.3 Undertakings overdue and not fulfilled during the reporting period Applicable Inapplicable 3.4 Warnings and explanations of any forecasted loss or significant changes in accumulated net profit for the period from the beginning of the year to the end of the next reporting period or in comparison to the same period of the previous year. Applicable Inapplicable 3.5 Changes in accounting policies Applicable Inapplicable International Financial Reporting Standards 9 have been applied from 1 January As the Bank has implemented the above accounting standards when preparing the first quarterly financial statements in 2018, it does not need to restate prior-year comparable data according to relevant rules in the new standards. The Twenty-first Meeting of the Seventh Session of the Board of Directors held by the Bank reviewed and approved the changes in accounting policies and issued relevant announcements. Please log on the websites of Shanghai Stock Exchange ( and Hong Kong Exchanges and Clearing Limited ( and the Bank ( for inquiries. 3.6 Other significant events Applicable Inapplicable

14 IV. PUBLICATION OF QUARTERLY REPORT The quarterly report 2018 prepared in accordance with PRC GAAP and IFRS respectively are available on the websites of Shanghai Stock Exchange ( Hong Kong Exchanges and Clearing Limited ( and the Bank ( V. APPENDIX The consolidated statement of profit or loss, the consolidated statement of comprehensive income, the consolidated statement of financial position, and the consolidated cash flow statement (prepared under IFRS) are attached below. Legal Representative: Li Xiaopeng Board of Directors China Everbright Bank Company Limited 27 April

15 China Everbright Bank Company Limited Consolidated Statement of Profit or Loss For the three months ended 31 March 2018 (Expressed in millions of Renminbi, unless otherwise stated) For the three months ended 31 March Interest income 39,437 38,671 Interest expense (26,821) (23,468) Net interest income 12,616 15,203 Fee and commission income 9,887 8,666 Fee and commission expense (573) (458) Net fee and commission income 9,314 8,208 Net trading gains/(losses) 162 (312) Net gains/(losses) arising from investment securities 3,462 (9) Net foreign exchange (losses)/gains (303) 494 Other net operating income Operating income 25,378 23,692 Operating expenses (7,318) (6,759) Operating profit before impairment 18,060 16,933 Impairment losses on assets (6,960) (5,486) Profit before tax 11,100 11,447 Income tax (2,029) (2,848) Net profit 9,071 8,599 Net profit attributable to: Equity shareholders of the Bank 9,051 8,579 Non-controlling interests ,071 8,599 Earnings per share Basic earnings per share (in RMB) Diluted earnings per share (in RMB)

16 China Everbright Bank Company Limited Consolidated Statement of Comprehensive Income For the three months ended 31 March 2018 (Expressed in millions of Renminbi, unless otherwise stated) For the three months ended 31 March Net profit 9,071 8,599 Other comprehensive income for period: Items that may be reclassified subsequently to profit or loss: - Financial investments at fair value through other comprehensive income/ Available-for-sale financial assets - Net Change in fair value 840 (1,604) - Impairment Change in fair value reclassified to the profit or loss upon disposal Impairment reclassified to the profit or loss upon disposal (33) - - Related income tax effect (324) Exchange differences on transaction of financial statements of overseas subsidiaries (56) (3) Other comprehensive income attributable to non-controlling interests, net of tax (1) - Other comprehensive income, net of tax 847 (1,095) Total comprehensive income 9,918 7,504 Total comprehensive income attributable to: Equity shareholders of the Bank 9,899 7,484 Non-controlling interests ,918 7,

17 China Everbright Bank Company Limited Consolidated Statement of Financial Position As at 31 March 2018 (Expressed in millions of Renminbi, unless otherwise stated) Assets 31 March 31 December Cash and deposits with the central bank 363, ,703 Deposits with banks and other financial institutions 29,062 44,754 Precious metal 40,053 40,352 Placements with banks and other financial institutions 142, ,816 Financial assets at fair value through profit or loss 268,050 24,196 Derivative financial assets 6,854 4,513 Financial assets held under resale agreements 99,877 91,441 Interests receivable 28,354 28,576 Loans and advances to customers 2,058,941 1,980,818 Finance lease receivables 57,901 56,364 Financial investments at fair value through other comprehensive income 147,422 - Financial investments measured at amortized cost 864,120 - Available-for-sale financial assets - 414,547 Held-to-maturity investments - 344,617 Debt securities classified as receivables - 514,576 Fixed assets 15,093 14,929 Goodwill 1,281 1,281 Deferred tax assets 10,324 7,596 Other assets 30,313 17,164 Total assets 4,163,187 4,088,

18 China Everbright Bank Company Limited Consolidated Statement of Financial Position (continued) As at 31 March 2018 (Expressed in millions of Renminbi, unless otherwise stated) Liabilities and equity 31 March 31 December Liabilities Due to the central bank 257, ,500 Deposits from banks and other financial institutions 536, ,447 Placements from banks and other financial institutions 141, ,798 Derivative financial liabilities 8,583 6,552 Financial assets sold under repurchase agreements 16,919 45,581 Deposits from customers 2,345,911 2,272,665 Accrued staff costs 6,865 8,412 Taxes payable 5,834 4,932 Interests payable 40,241 40,206 Debts securities issued 459, ,396 Other liabilities 38,072 42,318 Total liabilities 3,856,603 3,782,

19 China Everbright Bank Company Limited Consolidated Statement of Financial Position (continued) As at 31 March 2018 (Expressed in millions of Renminbi, unless otherwise stated) Liabilities and equity (Continued) 31 March 31 December Equity Share capital 52,489 52,489 Other equity instrument 35,108 35,108 Capital reserve 53,533 53,533 Other comprehensive income (272) (1,845) Surplus reserve 21,054 21,054 General reserve 52,257 52,257 Retained earnings 91,735 92,164 Total equity attributable to equity shareholders of the Bank 305, ,760 Non-controlling interests Total equity 306, ,436 Total Liabilities and equity 4,163,187 4,088,243 Approved and authorized for issue by the board of directors on 27 April Li Xiaopeng Zhang Jinliang Xie Rong Chairman of Board of Directors, President, Executive Director Independent Non-executive Director Non-executive Director

20 China Everbright Bank Company Limited Consolidated Cash Flow Statement For the three months ended 31 March 2018 (Expressed in millions of Renminbi, unless otherwise stated) Cash flows from operating activities For the three months ended 31 March Net profit 9,071 8,599 Adjustments for: Impairment losses on assets 6,960 5,486 Depreciation and amortisation Unwinding of discount (181) (245) Unrealised foreign exchange losses Net (gains)/losses on disposal of investment securities (3,462) 9 Net gains on disposal of trading securities (614) (47) Revaluation losses on financial instruments at fair value through profit or loss Interest expense on debt securities issued 5,018 4,287 Net losses on disposal of fixed assets 1 - Income tax 2,029 2,848 20,031 21,906 Changes in operating assets: Net decrease in deposits with the central bank, banks and other financial institutions 1,079 6,041 Net (increase) /decrease in placements with banks and other financial institutions (16,326) 5,375 Net increase in loans and advances to customers (91,890) (103,694) Net (increase) /decrease in financial assets held under resale agreements (8,463) 17,602 Net increase in other operating assets (11,472) (10,136) (127,072) (84,812)

21 China Everbright Bank Company Limited Consolidated Cash Flow Statement (continued) For the three months ended 31 March 2018 (Expressed in millions of Renminbi, unless otherwise stated) Cash flows from operating activities (continued) For the three months ended 31 March Changes in operating liabilities: Net decrease in deposits from banks and other financial institutions (41,341) (249,258) Net increase in placements from banks and other financial institutions 34,484 11,692 Net decrease in financial assets sold under repurchase agreements (28,663) (12,235) Net increase in due to the central bank 25,000 24,500 Net increase in deposits from customers 73, ,411 Income tax paid (2,050) (1,624) Net (decrease)/increase in other operating liabilities (8,240) 3,914 52,436 (100,600) Net cash flows from operating activities (54,605) (163,506) Cash flows from investing activities Proceeds from disposal and redemption of investments 217, ,924 Proceeds from disposal of fixed assets and other assets Payments on acquisition of investments (195,687) (282,012) Payments on acquisition of fixed assets, intangible assets and other assets (906) (387) Net cash flows from investing activities 21,323 (71,409)

22 China Everbright Bank Company Limited Consolidated Cash Flow Statement (continued) For the three months ended 31 March 2018 (Expressed in millions of Renminbi, unless otherwise stated) Cash flows from financing activities For the three months ended 31 March Net proceeds from issue of debt securities 13, ,735 Interest paid on debts securities issued (6,182) (4,567) Net cash flows from financing activities 7, ,168 Effect of foreign exchange rate changes on cash and cash equivalents (2,013) (488) Net decrease in cash and cash equivalents (27,583) (41,235) Cash and cash equivalents as at 1 January 147, ,507 Cash and cash equivalents as at 31 March 120, ,272 Interest received 37,658 35,400 Interest paid (excluding interest expense on debts securities issued) (20,603) (17,569)