Bloomberg:

I have two questions. Many European countries have rolled out measures to sanction Russia recently. How will this affect China's financial institutions? Will China follow suit with similar financial sanctions against Russian banks? Secondly, can you update some of the latest progress of the rectification of Ant Group and other fin-tech platforms? What are the next steps? Thank you.

Guo Shuqing:

Regarding your first question, we have paid great attention to the recent armed conflict, or war, between Russia and Ukraine. The Ministry of Foreign Affairs has fully explained China's take on the issue, and our international policies remain consistent. We don't support financial sanctions, especially those proposed unilaterally. This is because such sanctions do not have good effects or much legal basis. We won't join such sanctions and will continue the normal economic, trading, and financial activities with relevant parties. As for how these sanctions will affect China's economy and finance, the impact so far is not clear, and the situation requires further observation. Nevertheless, we believe that, in general, there will not be much impact in the future, for our economy and finance are fairly steady and resilient.

In terms of the second question, not long ago, a special report was released to introduce the situation regarding the rectification of 14 internet platforms that are associated with financial businesses, such as Ant Group. Led by the People's Bank of China, three government bodies, including the CBIRC, the China Securities Regulatory Commission and the State Administration of Foreign Exchange have launched the rectification work since 2020. The rectification has been going well in general. The financial business offered by these platforms is innovative to a certain extent and was not supervised in the past. It takes some time to bring them under supervision. There are many problems during the rectification process, such as how the enterprises and administrative departments identify or certify these products, personal data and privacy protection, and the safeguard of business information and trade secrets, to name a few. These problems concern various aspects and are very complicated, but in general, we are confident in our ability to implement the rectification work well. 

Yicai:

I have a question for Mr. Guo, and this is also a hot issue for many stock investors. In recent years, the stock price of large-scale banks has remained comparatively low, and they have a low price-to-book (P/B) ratio. What do you think of this issue? Will there be any measure taken next to make the stock price of these banks truly reflect its value? Thank you.

Guo Shuqing:

I'd like to invite Mr. Tian Guoli, chairman of the CCB, to take your questions. The CCB is the first among China's four big banks to be listed, and it has done a lot of research and analysis on this issue. Mr. Tian will have the floor.

Tian Guoli:

Thank you for your questions. This issue has attracted many stock investors' attention. To put it precisely, since the subprime mortgage crisis in 2008, investors have been holding a less favorable opinion of the business models of traditional commercial banks. Glories of the past no longer exist, and their P/B ratio dropped from over 2 to less than 1. Under this situation, China and the rest of the world have been closely connected, and to a certain extent, finance has become a business that knows no borders. As for the actual market value of Chinese-funded banks, their average P/B ratio of A-share basically stands at 0.66, and that of H-share is 0.47, higher than Japan's 0.44 and lower than Europe's 0.72 and 1.42 of the U.S. Therefore, what I want to say is that this is actually a problem of how stock investors view traditional finance. For the investment itself, I think this is still lucrative. Take CCB, for example. Since it was listed in 2005, CCB has paid more than 900 billion yuan in dividends. In 2019 and 2016, the dividend yield of A-share reached 4.48% and 5.05%, and that of H-share hit 5.66% and 6.09%. Large-scale banks are not suitable for short-term investment. However, in the long run, our dividend yield has far exceeded that of other financial products, meanwhile, shareholders can have the opportunity to make a profit after holding our stocks. As for the issue of stock price, we still need to keep working on the matter. Despite our weaknesses, there are also aspects of our work that the public is not familiar with. For example, CCB has been working to promote new finance. In fact, CCB has transformed. Using an Internet-based thinking model, we have set up 520,000 inclusive financing facilities in about 80% to 90% of villages across China in a bid to provide financing services for rural residents. We have completely applied new platforms and internet-based logic, and our services have covered almost all villages. The future market potential is huge.

The CCB also excels in fintech. Now, CCB's fintech not only provides system construction for CCB itself but also offers support in system construction for its peers. It is increasingly market-oriented. Now, it is delivering results. I hope that people will pay attention to these new moves by CCB. I believe that, with the help of a positive outlook, this will bring a handsome income to the shareholders. Thank you.