Competitive Strengths

　　The year 2024 was a crucial year for fulfilling the objectives and tasks set out in the 14th Five-Year Plan. It was also an important year in which the Agricultural Bank of China made new achievements in its reform and development. In the past year, we took the rectification of problems identified in the new round of disciplinary inspections conducted by the Communist Party of China (“CPC”) Central Committee as an opportunity to uphold and strengthen the overall leadership of the Party and conscientiously implement the decisions and plans of the CPC Central Committee and the State Council. We identified the focal points of maintaining “stability” and the main directions of pursuing “progress”, and took solid measures to serve the real economy and carry out our business activities. We sustained sound momentum in our main operating indicators, maintained resilience and growth amid complex and ever-changing market conditions, and continued to make new advances in highquality development. 

　　Our operating quality and effectiveness were continuously improved. During the reporting period, we were the first among comparable peers to turn our profit growth from negative to positive in the first half of the year, and continued to record quarter-over-quarter improvements in the second half of the year. In 2024, we achieved net profit of RMB282.7 billion, representing a year-on-year increase of 4.8%. In 2024, we achieved operating income of RMB711.4 billion, representing a year-on-year increase of 2.3%, of which net interest income was RMB580.7 billion, representing a year-on-year increase of 1.6%. The provision of financing was continuously stepped up. As at the end of 2024, the Group’s total assets exceeded RMB43 trillion, and total loans and advances to customers increased by RMB2.29 trillion as compared to the end of the previous year, with the balance of loans in County Areas accounting for over 40% of domestic loans. The fund capacity was steadily strengthened. The balance of all-system deposits from customers amounted to RMB34.97 trillion, with an average daily balance of domestic deposits increasing by RMB2.29 trillion, the highest among comparable peers, and the deposit deviation ratio of 0.42%, the lowest among comparable peers, providing strong funding support for serving the real economy. Asset quality made solid improvement. The non-performing loan ratio was 1.30%, representing a decrease of 0.03 percentage point from the end of the previous year. The overdue loan ratio was 1.18%, and the allowance to non-performing loans was 299.61%, maintaining the leading position among comparable peers. Meanwhile, our capital adequacy ratio was 18.19%, representing an increase of 1.05 percentage points from the end of the previous year, further cementing the foundation of our development. 

　　We stayed true to our founding mission and tapped deep into our core business, consolidating the foundation for high-quality development with targeted and effective financial services. Bearing in mind the country’s most fundamental interests and highlighting our two positionings as a leading bank serving rural revitalization and a major bank serving the real economy, we continued to strengthen and improve the supply of high-quality financial resources, and took more solid steps and made more effective achievements in providing financial services for agriculture, rural areas and rural residents and the real economy. We enhanced our primary responsibility and core business of serving agriculture, rural areas and rural residents. We consistently gave priority to County Areas and rural areas in allocating financial resources. A total of 55 thousand County Area customer managers worked diligently in the countryside, and “financial directors of villages” were appointed in over 40 thousand administrative villages. We pooled all wisdom and strength to do the “hard but right things” in key fields including ensuring food security and consolidating and expanding achievements in poverty alleviation. As at the end of 2024, the balance of loans and advances to customers in County Areas was RMB9.85 trillion, and the balance of loans in fields related to ensuring stable supply of grains and major agricultural products exceeded RMB1 trillion. The balance of Huinong E-loan was RMB1.49 trillion. The loans to 160 key counties receiving assistance in pursuing rural revitalization grew by 14.7%. We have been awarded the highest rating in the regulatory assessment of serving rural revitalization for four consecutive years. We took a full array of actions to support economic recovery and growth. We conscientiously implemented a pack of new national policies, provided proactive services to support for the implementation of major national strategies and security capacity building in key areas and for a new round of large-scale equipment upgrades and consumer goods trade-in programs, and actively supported for stemming the downturn and restoring stability in the real estate market. We ranked top among comparable peers in terms of the growth rate of loans in relevant fields, including equipment upgrades and residents’ consumption. We stepped up financing provision in areas related to people’s livelihood such as housing, education and medical services. The balance of retail loans amounted to RMB8.81 trillion, representing an increase of RMB754.3 billion as compared to the end of the previous year, with both increment and growth rate ranking first among comparable peers. We actively supported the development of private sector. The balance of loans granted to private enterprises was RMB6.53 trillion, representing an increase of RMB1.08 trillion as compared to the end of the previous year; the number of customers with outstanding loan balances was 7.46 million, representing an increase of 1.35 million customers as compared to the end of the previous year, all leading the industry. We spared no effort to promote the “Five Priorities”. We innovatively supported the development of new quality productive forces. All loans in fields including strategic emerging industries and green credit increased by over 20%. We stepped up the launch of the asset investment companies (AIC) equity investment pilot funds, channeling long-term and patient capital into technological innovation. We conscientiously implemented the coordination mechanism for supporting small and micro enterprises in obtaining financing, and the balance of inclusive finance at PBOC caliber was RMB4.66 trillion, ranking first among peers. We focused on developing the featured service brand of “ABC Pension”. All 22 thousand outlets completed age-friendly renovations, the balance of loans to elderly care industry increased by 68%, and the scale of our pension funds under entrusted management exceeded RMB300 billion. 

　　Adhering to the standard of satisfaction of customers and employees, with perseverance of pursuing brilliance and determination of self-innovation, we tapped into reform and innovation to improve quality and efficiency of services and stimulate momentum for development. We sped up the exploration of smart banking construction. Keeping pace with changes and revolutions in AI, we developed the “AI +” innovation action plan, implemented big data and AI application projects, explored the deep integration of AI in key fields such as customer service and risk prevention and control, and accelerated our steps into a new stage of digital and intelligent transformation. Customer experience and service efficiency were continuously improved. In response to market changes and customer expectations, we constantly increased the efficiency of the whole-process intelligent loan services, further optimized operating procedures, with the average waiting time per customer at outlets reducing by 20%. Consumers’ interests protection was strengthened comprehensively. The number of complaints per thousand outlets and per ten million retail banking customers were the lowest among comparable peers, and our rating in the regulatory assessment of consumers’ interests protection upgraded again. We focused on expanding our team of customer managers, with the number of customer managers increasing to 113 thousand. Greater efforts were made to cement the customer base and business foundation. Benefiting from robust technological empowerment and improved management efficiency, the number of retail banking customers exceeded 0.88 billion and the number of corporate banking customers increased to 12.13 million at the end of the year. The aggregate financial assets of private banking customers amounted to RMB3.15 trillion, and the scale of custody business exceeded RMB17 trillion. The number of monthly active users of mobile banking reached 250 million, maintaining the leading position in the banking industry. We further strengthened care for our employees. We heeded the voice of employees at foundation level and addressed their most pressing difficulties and problems, ensuring that all employees can contribute to and share the fruits of development. We had accumulatively built more than 100 thousand “Home of Employees” facilities, such as small canteens and small shower rooms. The employee questionnaire survey showed an increase of 4 percentage points in overall satisfaction. 

　　We safeguarded high-quality development by taking comprehensive and proactive measures for risk prevention and control. Always making risk prevention and control the primary task, we developed a more proactive and intelligent risk prevention and control system and actively enhanced prevention, early warning, disposal and resolution of all types of risks. Comprehensive risk management was continuously improved. We accurately captured the changes in macro economy and financial market, widened our vision of risk prevention and control, optimized the organizational structure of risk management, refined the risk management system covering whole chain, field and process, and adopted an integrated approach to preventing and resolving traditional risks as well as risks in emerging areas, so that all kinds of risks were generally under control. The foundation of asset quality was further consolidated. We adopted a developerspecific policy for targeted disposal of real estate risks and a province-specific policy for helping local governments defuse debt risks. We prevented and controlled credit risks in emerging industries and inclusive and retail business in a forward-looking manner, and stepped up management and control of overdue loans and disposal of non-performing loans, so that our asset quality maintained a relatively good level among comparable peers. Meticulous efforts were made to prevent and control various new types of risks. We brought the distributed core system project to a successful conclusion, and further improved cyber security protection system of the Group. Efforts were intensified to prevent and control risks in market-related business and overseas institutions, maintaining steady operations amid complex and ever-changing conditions. 

　　Through sound governance and collaboration, we shared the fruits of high-quality development with investors by providing them with favourable returns. As a large publicly listed bank, we attached great importance to corporate governance and market value management, and strived to create greater value for investors. We continuously refined the corporate governance system. We put the “Two-sphere Consistency” into action, integrated the Party’s leadership into every aspect of corporate governance, and kept improving the effective corporate governance system with the Bank’s features. In the PBOC’s macro-prudential assessment (MPA), we were awarded the Grade A rating for 11 consecutive quarters and were the only bank among comparable peers to achieve this honour. The members of the Board of Directors performed diligently. The Board of Directors operated effectively and compliantly. We were awarded the “Best Practice Case for the Board of Directors of Listed Companies”. We actively delivered returns to investors. In active response to market and investor concerns, we deepened the building of sustainable management and information disclosure system, and continuously increased investor returns. In 2024, our A Share price and H Share price grew by 55% and 58%, respectively, both ranking first among comparable peers. The growth of our market capitalization ranked first among comparable peers for two consecutive years, helping stabilize the market with our steady operations. 

　　The achievements and progress of the past year were fundamentally attributed to the strong leadership of the CPC Central Committee and the State Council, and attributed to the guidance, care and support provided by regulators, shareholders and all sectors of society, as well as the concerted efforts of all the Bank’s cadres and employees. On behalf of the Board of Directors, I would like to express my heartfelt gratitude! The Board of Directors proposed to distribute a cash dividend of RMB1.255 (tax inclusive) per 10 ordinary shares for all ordinary shareholders in addition to the interim dividend. 

　　The year 2025 is the final year for implementing the 14th Five-Year Plan. It is also the year in which the 15th Five-Year Plan will be strategically devised. Standing at a critical point linking the past with the future, we will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly implement the decisions and plans of the CPC Central Committee and the State Council, closely adhere to the work theme of preventing risk and promoting development, and promote the rectification of problems identified in the disciplinary inspections conducted by the CPC Central Committee and our business operations and development in a coordinated manner. Driven by further deepening reform comprehensively, we will keep improving our ability to serve high-quality development of the country while pursuing high-quality development of the Bank, and contribute to the sustained economic recovery and growth and the successful conclusion of the 14th Five-Year Plan.