ANNUAL REPORT 2013 - Citi

Citibank (China) Co., Ltd.

ANNUAL REPORT2013

CONTENTSCHAIRMAN’S MESSAGE

INSTITUTIONAL CLIENTS GROUP

GLOBAL CONSUMER BANKING

UPHOLDING WORLD-CLASS CORPORATE GOVERNANCE

GIVING BACK TO THE LOCAL COMMUNITY

AWARDS AND RECOGNITION

CITI’S MISSION & KEY PRINCIPLES

BRANCH NETWORK

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Sincerely,

Andrew Au

Chairman, Citibank (China) Co., Ltd.

CHAIRMAN’S MESSAGEI’m pleased to present to you the Citibank (China)

Co., Ltd. 2013 Annual Report. Citi China ended the

year with notable achievements which reinforced

our leadership in China’s financial industry.

China is one of the most important markets for Citi

globally, and we place great emphasis on long-term

planning for our sustainable development in this

market. Our continued investments aim to enable

progress for our clients by leveraging our global

network synergies and capitalizing on three

long-term trends – globalization, urbanization, and

digitization.

During the year, we expanded our target markets,

pursued new business opportunities, and grew our

employee and client bases. We also strengthened

our product innovation and extended our network

presence in line with the latest development of the

local banking industry.

Our Global Consumer Bank upheld its long-stand-

ing reputation in wealth management, substantiat-

ed by our ability as the first foreign bank to launch

domestic mutual funds in China. We continued to

push ahead with our credit card business, for which

we were the first global bank to issue sole-branded

credit cards, offering attractive products and

unique value propositions to our card holders.

We were also actively engaged in China’s financial

reform, and were honored to be the pioneer global

bank to obtain approval to prepare for a

sub-branch in the China (Shanghai) Pilot Free

Trade Zone. By amalgamating the latest policies in

the Zone with our unparalleled global expertise,

local insight and client relationships, we launched

industry-first solutions that helped our clients

maximize opportunities there.

As a result, we delivered solid financial perfor-

mance and ended 2013 with strong numbers. We

achieved an operating income of RMB4.35 billion

and a net profit of RMB964 million. Our prudent

approach in operations and continued focus on

high quality customers allowed us to attain strong

healthy ratios, like our Capital Adequacy Ratio,

which was at 14.22 percent and well above the

regulatory requirement.

We are optimistic about the future of China. As we

move the business forward, we will continue to

actively participate in and contribute to China’s

financial reform for the development and prosperi-

ty of the local banking and financial sector. I

believe that, with this right attitude, strategy and

vision for success, Citi China will continue bringing

more opportunities to our clients and China.

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Citi’s Institutional Clients Group builds enduring relationships with clients by provid-ing a full suite of strategic advisory and financing products to multinational and local corporations, financial and public sector institutions, and privately held businesses.

Citi’s Corporate and Investment Bank-ing arm provides comprehensive rela-tionship coverage service to ensure the best possible service and responsive-ness to our clients.

Corporate and Investment Banking

Sub-branch in the Shanghai Pilot Free Trade Zone

Global Subsidiaries Group

Citi has traditionally been a leading financial

service provider to multinational companies oper-

ating in China.

In 2013, our Global Subsidiaries Group (GSG)

continued to capitalize on Citi’s global network and

broad service offerings to support our client’s

growth in China. The department witnessed good

business momentum in 2013 as clients continued

to invest and build capacity for the future. We

focused on holistic client advisory that is combined

with strong execution, and helped our clients raise

significant funds from the capital markets, includ-

ing several innovative structures in cross border

financing flows.

INSTITUTIONALCLIENTS GROUP

CCCL has also been elected as the Co-Chair of the

Shanghai Banking Association (SBA) FTZ commit-

tee.

As part of the ongoing reform in the FTZ, Citi China

launched RMB cross-border auto pooling and

payment netting solutions in line with newly

released FTZ policies. We are the first bank to do

so, thanks to our unparalleled global network,

strong product capabilities and in-market knowl-

edge in customizing existing solutions according to

client needs.

As a leader in the local financial industry, Citi has

also given more than 15 talks at internal and exter-

nal events, webinars and seminars to relevant

global customers, which educated the audience

about new regulations, opportunities for them in

the Zone and our corresponding services created

for their benefit.

In 2013, Citi China continued to help our clients

develop and expand domestically and overseas.

Some of these clients have now expanded across

five continents, and our nine China Desks based in

A key milestone for Citi China in 2013 was the approval in September 2013 to open a sub-branch in the China

(Shanghai) Pilot Free Trade Zone (FTZ). The FTZ is a big step taken by the Chinese government in its reform

journey. It is an honor to be the first global bank to receive this approval.

key cities around the globe continue to serve them.

We hosted ‘China Day’ in multiple cities around the

world, sharing with clients insights and updates on

their concerned industries and the related econo-

mies. We also organized China Desk Network Day

in April and December, where we gathered staff

from all our China Desks to meet with Chinese

customers and give them a platform to network

with each other.

INSTITUTIONAL CLIENTS GROUP02 03

Driven by the special needs of institutional clients,

the Financial Institutions Group (FIG) and Public

Sector Group (PSG) provide comprehensive finan-

cial solutions to a wide range of financial institu-

tions and the public sector, including banks, insur-

ance companies, securities firms, fund managers,

trust and leasing companies, and public sector

firms.

FIG & PSG achieved robust business development

in 2013. We continued to lead the industry with the

strongest presence of any international bank in the

local market, offering a full spectrum of

tailor-made solutions with a deep understanding of

the financial institutions industry in China. We also

have one of the largest professional financial insti-

tutions team among foreign banks in China.

The FIG also facilitated the implementation of new

rules from two regulatory bodies:

Financial Institutions Groupand Public Sector Group

Markets

With one of the largest Markets teams among international banks, Citi offers a broad range of market-leading and innovative financial products to corpo-rate, institutional, government and public sector clients.

In order to better provide customers with solutions

according to their unique needs, Citi China also

partnered with other banks and financial institu-

tions including mutual fund, insurance, pension and

sovereign fund companies, to leverage on each

other’s strengths and innovation.

In 2013, Citi Markets sustained strong performance

and maintained its leadership position in foreign

exchange, interest rates and commodities.

As many Chinese companies showed a large inter-

est in going global during the year, the Markets

team was focused on enabling them to do so. In

addition to traditional banking services, we helped

them set up global risk management platforms,

manage foreign exchange exposures, conduct

structured finances, and execute hedging transac-

tions onshore and off-shore.

Best Overall FX Services (Corporate category);

Best FX Options (Corporate category);

Best FX Products and Services (Corporate cate-

gory);

Best FX Research and Market Coverage (Corpo-

rate category);

Top three Best FX Services (Financial Institu-

tions category).

The China Insurance Regulatory Commission

(CIRC) released its first rulebook for interim

measures for overseas investment of insur-

ance funds. As Citi China works with several

insurance companies, FIG took responsibility in

proactively assisting our partner insurance

agencies in planning for future business

according to the rules.

The China Banking Regulatory Commission

(CBRC) put in place new capital management

regulations for banks for the first time. To this

end, Citi China FIG shared with other banks

about our company’s global experience to help

everyone get up to speed.

We were also recognized as the industry’s best in

client servicing by Euromoney magazine and

research-based consulting firm Greenwich Associ-

ates (top three).

Citi China bagged five titles in Asia Pacific finance

magazine Asian Money’s 2013 Foreign Ex-change

(FX) survey:


Treasury and Trade Solutions

Executing the first RMB cross-border lending

transaction in January 2013 and maintaining

leadership in the number of these transactions;

Launching a series of RMB cross-border trade

refinancing solutions that give clients

optimized trade financing for their cross border

RMB trade flows;

Providing successfully foreign currency

cross-border centralized fund management

solutions for multinational corporations under

State Administration of Foreign Exchange’s

(SAFE) pilot program;

Being the first international bank to launch a

paperless processing solution for RMB

cross-border settlements;

Performing the first cross border RMB sweep-

ing transaction in the market.

Treasury and Trade Solutions (TTS) delivers cash

management and trade solutions that help clients

streamline and automate processes, mitigate risk

and expand their reach.

In 2013, the TTS team continued to lead the way in

delivering innovative and customized solutions to

clients, including an array of digital and mobile-en-

abled platforms and tools. Of note were a couple of

new product launches in cash delivery and trade

and treasury management that are first in the

industry. These new solutions are focused on

promoting RMB internationalization, created in

line with our approval as the first global bank to

open a sub-branch in the China (Shanghai) Pilot

Free Trade Zone (FTZ).

Business highlights include:

All of these products and services aim to improve

treasury efficiency for our clients. For Chinese

multinational corporations, TTS dedicated atten-

tion to providing them even greater financial

support for their global business expansion.

Securities and Fund Services

Securities and Fund Services (SFS) offers a large

portfolio of products and services including custo-

dy, escrow and related services, depositary

receipts, and agency and trust.

We also support international securities trading

and investment activities of leading institutions

through efficient receipt, delivery and safekeeping

of securities as well as the related cash and FX

functions.

All these services are offered to a wide range of

sophisticated investors, including mutual funds,

pension funds, hedge funds, banks, and insurers.

Global industry surveys consistently rank us as a

premier choice for custody, clearing, agency and

trust, and depositary receipts services in more

markets than any other bank.


Citi China offers two credit cards: Premier Miles

and Rewards, targeting different consumer

segments according to their spending preferences,

and are available in all 13 cities that Citi China oper-

ates in.

The PremierMiles Card boasts the widest range of

redemption choices for over 50 airlines and access

to over 600 airport lounges worldwide six times

per year, and gives cardholders the flexibility of

transferring air miles to friends and family;

Rewards Card holders enjoy preferential offers

with Citi’s merchant partners, and can use points

accumulated to redeem air miles or vouchers.

2013 September 19th marked the first year anniver-

sary of our sole-branded credit cards. Results have

exceeded expectation and outperformed the

market average. Retail sales were three times

above average; activation rate was twice that of

average.

As a testament to delivering remarkable customer

experience, Citi launched a 60-minute card

issuance service in 2013 where customers could

get their applications approved and personalized

cards issued within an hour.

In 2013, GCB celebrated a number of milestones in the

credit card and wealth management businesses,

including instant card issuance and the launch of local

mutual fund. Our retail network also expanded with a

new outlet in Chengdu, bringing our total number of

retail outlets in the country to 52.

Citi China is deeply committed to bringing choices,

innovation and world-class wealth management

products and services to our customers.

Besides offering customers a comprehensive array

of products, we are also devoted to creating more

convenient and smarter service channels. For

example, in April 2013, we incorporated QDII

mutual funds transactions into CitiPhone Banking,

through which customers can buy, sell, redeem,

and transfer QDII mutual funds remotely, thereby

increasing efficiency notably.

Citi became the first foreign bank to be allowed by

the China Securities Regulatory Commission

(CSRC) to sell domestic mutual funds in the country

in June 2013. A new addition to the bank’s existing

portfolio of wealth management services, Citi

China’s domestic mutual fund products combines

our experience in global mutual funds with our local

market knowledge.

By the end of 2013, Citi China was partnering with

five fund houses to offer over 20 domestic mutual

funds.

GLOBAL CONSUMERBANKING

GLOBAL CONSUMER BANKING

Commercial Bank

Citi is focused on being a trusted financial advisor of

each and every of our small and medium private enter-

prises (SMEs) customer.

In 2013, our commercial banking business attained

strong growth among key indicators in revenue,

customer deposits.

We tap our global expertise and resource network to

bring new, innovative and value-added solutions that

better cater to our expanding customer base and

enhance our relationships with them. For example, our

mobile banking application allows customers to access

banking services, like payment authorization, efficient-

ly, conveniently, and most importantly, safely.

Citi offers a broad range of solutions to our SME

customers, such as our American Depositary Receipts

(ADR), syndicated loans, bonds, international funds

and cross-border RMB settlement pooling services,

grant SMEs the capability to expand their business

abroad, thereby increasing their competitiveness. In

2013, Citi Commercial Bank partnered with our China

Export and Credit Insurance Corporation (SINOSURE)

to support a number of SMEs in export insurance and

financing.

It is important that our SME customers are kept

apprised of market movements so that they can plan

better and more sustainable business strategies. We

do this through different activities and communica-

tions, like trainings, seminars, and networking events

organized in collaboration with the Economic Informa-

tion Commission, various SME associations, law firms,

auditing companies, etc. These events also encourage

a spirit of information sharing among SMEs and the

aforementioned third parties in the country.

In 2013, we held over 50 of these sessions that

spanned more than 200 hours across 15 cities in China,

and received a ‘SMEs’ Favorite Service Provider’

award from Guangdong Provincial SME Development

Association.

Credit Cards

Wealth Management Products

Domestic Mutual Funds

The Citibank China Emerging Affluent Tracker

Report, conducted semi-annually by research com-

pany Anovation, evaluates a set of markets and

trends KPIs to calculate Citi China’s brand consid-

eration scores as a measure of the level of public

awareness of our brand.

In 2013, Citi China continued and expanded our

‘Blue Wave’ branding campaign to five major cities,

namely, Beijing, Chongqing, Guangzhou, Shanghai

and Shenzhen. We paid extra attention on deliver-

ing value-added communications like sending

relevant and useful information to target audienc-

es. As a result, our brand consideration score more

than doubled from that of 2012.

Building Brand Awareness

Citi’s Global Consumer Bank (GCB) focus-es on serving affluent and emerging afflu-ent customer segments in top-tier cities, where the bank’s unique global network, premium brand, customer-centric prod-ucts and services provide unique competi-tive advantages. GCB aims to deliver a remarkable experience through indus-try-leading products and services, next-generation retail formats and world-class digital channels.

08 09

In 2013, we held 4 Board meetings at an average of once every quarter. The Board resolved or heard the

reports of a total of 57 matters (including 26 resolutions and 31 reports). In addition, CCCL Board has exer-

cised 6 written resolutions to 6 key matters in the period between Board meetings.

During the intersession of the board meetings, we also provided 14 newsletters to the Board in terms of

CCCL’s monthly financial information, CBRC on-site inspection on CCCL’s consumer banking business and

commercial banking business, CCCL’s self-assessment on counter operation and financial/expense control,

and Notice on Foreign Banks’ Risk Prevention and Stable Development for 2013 issued by CBRC Shanghai.

The structure of the Board of Directors has been optimized since the establishment of Citibank China Co., Ltd

(CCCL). As of 31 December 2013, the CCCL Board of Directors consisted of 10 directors in total, 5 non-execu-

tive directors, 3 executive directors and 2 independent directors.

At Citi, we aspire to the highest standards of corporate governance and ethical con-duct. We act in the best interests of all of our stakeholders, maintain the highest ethi-cal standards, and ensure full compliance with the laws and regulations that govern our company.

Board of Directors

Supervisor



Professional BoardCommitteesAs of December 31, 2013, there were three profes-

sional committees under the CCCL Board. These

were: a Related Party Transaction Control Com-

mittee established on June 13, 2007, an Internal

Audit Committee established on June 13, 2007 and

a Risk Management Committee established on

Independent DirectorsAs of the end of December 2013, we have two inde-

pendent directors, i.e., Mr. Stephen Long (who

replaced Mr. Danny Liu to be our new independent

director since June 2013) and Mr. Zhe Sun.

Mr. Stephen Long is the voting member of Internal

Audit Committee and Risk Management Committee

under the CCCL Board, and also chairs the Internal

Audit Committee.

Mr. Zhe Sun is the voting member of Risk Manage-

ment Committee and Related Party Transaction

Control Committee, and he is also the chairman of

Related Party Transaction Control Committee.

Both of them have attended all the Board meetings

and the relevant committee meetings (Mr. Stephen

Long attended all Board and relevant committee

meetings after his appointment), and were

involved in the consideration and approval of the

related matters.

In addition, during the intersession of the Board

meetings, the independent directors kept abreast

themselves with our monthly financial information,

business updates, and CBRC on-site inspections

through our newsletters.

Furthermore, Mr. Zhe Sun has issued his written

opinion on material related party transactions

reviewed through the 15th written resolution of the

Board (for completion of information purpose, Mr.

Danny Liu also issued a written opinion on the

same material related party transactions). The

CCCL does not have a board of supervisors, but

has a single supervisor designated by the share-

holder. Our supervisor Mr. Mark Hart performed

his duties diligently and attended all of the Board

meetings after his appointment, and issued confir-

mation letters to the meetings he attended accord-

ingly.

In addition, Mr. Hart supervised the Bank’s finan-

cials and the performance of directors and the

senior management. The supervisor also provided

opinions to the matters in relation to 2012 audited

financials, the performance of directors and the

senior management. We also informed the supervi-

sor about related party transactions under the

15th board written resolution.

independent directors have actively participated in

the decisions of the Board and provided their inde-

pendent opinions.

Board members can timely be aware of the opera-

tion and management situation of the Bank and

provide responses to management through such

communication mechanism. All the directors

performed their duties with due diligence and

protected the interests of both the Bank and the

shareholder.

Title

Chairman

IndependentDirector

Director

IndependentDirector

Director

Director

Director

Director

Director

Director

Name

Andrew Au

Stephen Long

Zhe Sun

Kai Zhang

Simon Chow

Stephen Bird

Deepak Sharma

Daisy Yao

Agnes Liew

Anthony Nappi

CFO

CCCL Title

Legal Representative, President

EVP

10 11

Robust Risk Management and Internal Control

Senior Management Team

Chairman

Committee Voting Member



Committee Non-Voting Member


Chairman




Stephen Long

Independent Director

Daisy Yao

Andrew Au

Simon Nie

Chairman









Daisy Yao

Stephen Long


Zhe Sun


Anthony Nappi

Andrew Au

Lili Qin

William To

Wai-ling Wong

Marine Mao

Zhe Sun


Andrew Au

Deepak Sharma

Agnes Liew

Lili Qin

Kai Zhang

Internal Audit Committee

Related Party Transaction Control Committee

Risk Management Committee

In 2013, the three special committees under the

Board, based on the principle of equally emphasiz-

ing quality and effectiveness, performed important

roles in assisting the Board to make correct

decisions. The three special committees held 12

meetings in total, reviewed 27 motions and heard

45 reports. Each of the three committees effective-

ly operated with distinct division of responsibilities

and provided professional advice and suggestions

in terms of audit, risk management and related

party transaction control. They provided solid

ground for the Board so that the Board could

The senior management team of the Bank performed

an active role in adherence to optimizing the corpo-

rate governance standard, expanding the Bank’s

scope and promoting the Bank’s reputation. The

team provided timely reports to the Board and/or the

Board committee through various channels, including

Board and committee meetings, newsletters, etc.

Management level committees also held several

meetings and actively exercised its management

functions.

Our management team also ensured that adequate

training was provided to employees. These topics

included anti-fraud policies and fraud awareness,

professional conduct, improper electronic communi-

cation, anti-money laundering and sanctions,

anti-bribery and corruption, etc. The senior manage-

ment team met regularly and worked diligently to

ensure the Bank performed well in 2013.

In addition to these achievements, we will continue to

adhere to, and where appropriate, strengthen our

governance practice to ensure stable, sustainable and

fast development in 2014.

The Risk Management Committee keeps itself

abreast of supervising senior management’s control

of various risks, including credit, market, liquidity,

compliance, operational , IT and, reputation risk. It

also reviews risk portfolio reports, classified portfoli-

os, NPLs and loss provisions and key risk limits

against actual exposures.

All voting members of the Committee attended every

of the four meetings held during the year. The Com-

mittee made 11 resolutions and heard 41 reports. The

risk portfolio seasonal report, classified portfolios,

NPLs and loss provisions, and key risk limits against

actual exposures were reviewed at each Committee

meeting.

The Committee paid attention to the credit card

portfolio, derivative risk assessment, stress test and

country risk policies. They continued to focus on the

key risk areas that CCCL faced due to regulatory

requirements and market changes, including reputa-

tion risk, information technology risk, fraud case

prevention and outsourcing risk, etc.

Internal Audit adopted a risk-based methodology,

which provides assurance that risks are being

managed within the organization’s risk tolerance.

Audit plan is driven by audit needs assessment of

auditable entities. The audit needs assessment is

based on a composite risk which is derived from two

distinctive ratings – Citigroup level risk rating and

country level risk rating.

Internal Audit received the latest business and

management information through business monitor-

ing and shared audit results, key findings and status

of corrective actions through various committee such

as the Business Risk and Compliance Control Commit-

tee etc. More importantly, it also draws management

attention to significant risks and internal control

lapses.

The Citigroup Chief Auditor, Regional Chief Auditor,

CCCL’s Chair of the Audit Committee and Country

Head of Audit paid several visits to CBRC Shanghai

and 6 local offices in 2013, so as to keep abreast with

the changing regulatory requirements and facilitate

communication with local regulators.

Topics discussed during these meetings include regu-

latory expectations, internal audit transformation,

audit focus and the three key performance indices

(KPIs) directly linked to the management’s perfor-

mance. The KPIs are: issues being addressed by

September 12, 2007. Details are as below: review and discuss the matters correctly and

efficiently.

management (IBAM); reopen rate (RoR); and on time

remediation rate (OTR).

At each committee meeting, members fully

expressed their opinions and provided constructive

and timely suggestions to the management team. All

members played an active role to support the Board

in making scientific and effective decisions.These

frequent communications facilitate mutual under-

standing between them and CCCL, and therefore,

help our internal audit team address their expecta-

tions and concerns more effectively.


The Related Party Transaction Control Committee

defines the principles, procedures and rules aimed at

ensuring transparency and procedural fairness of trans-

actions undertake with the Bank’s related parties.

The Committee takes responsibility of identifying the

related parties of CCCL and ensures that the latter’s

information is accurate. They monitor transactions in

credit extension, asset transfer and service provision.

General related party transactions are reviewed and

approved by the Committee, while the material related

party transactions are subject to approval by the

Committee to ensure all of CCCL’s related party transac-

tions are made in good faith, are according to the

arms-length principle, and are compliant with the

relevant laws and regulations.

In addition, material related party transactions are, post

the examination of the Committee, submitted to the

Board of Directors for final approval. By having a formal

approval and review process, it allows CCCL to achieve

in-country governance and enhance effectiveness of

controls.

The Committee is legislated by the China Banking Regu-

latory Commission’s administrative measures for

connected transactions between commercial banks and

their insider or shareholders, the Related Party Transac-

tion Internal Control Policy and the Working Rules for the

Related Party Transaction Internal Control Committee of

CCCL.

12 13

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MicrofinanceEnterprise Development

As a leading corporate supporter of microfinance in China, Citi has, over the decade, been advocating for the sector’s development by enlarging the capacity of non-profit microfinance institutions (NGO MFIs) and sector networks to support financial educa-tion initiatives for microfinance clients, many of whom are a less fortu-nate population.

Case Study: Agent Penny Program

The Citi– CBA Micro-entrepreneurship Awards

Financial Capability and Asset Building

Citi strives to put part of our money, talent, experi-

ence where we can help accelerate economic

opportunity, and to find ways to include more

people in the financial system. We support specific

causes that fit our mission of financial inclusion

and those where philanthropic capital can seed the

development and testing of new ideas with the

potential to attain scale.

Our efforts are partially catalyzed by Citi Founda-

tion’s investments in partners that promote finan-

cial inclusion and economic empowerment, and

fueled by the engagement of our employees and

partners. The Foundation provides support to

nongovernmental organizations working on the

ground and thought leadership and innovation

programs that promote the scaling of proven ideas.

We also encourage employees to participate

actively in activities that complement our commu-

nity activities.

In 2013, Citi China joined hands with more than ten

non-profit partners to launch twelve community

development programs that address a diverse

group of social, economic or environmental needs.

As Citi grows in China, we are committed to good corporate citizenship at every opportunity. We take a holistic approach in giving back to our local communities around China in a manner that is results-oriented and that contributes to the sustainable development of the communities we support.

Citi celebrates microentrepreneurs and microfi-

nance practitioners with the annual Citi Microen-

trepreneurship Awards (CMA). The Awards has a

secondary mission to raise awareness of the role

of microfinance in increasing access to finance

and poverty alleviation.

In October 2013, we held the ninth CMA in Beijing

where we gathered 200 microfinance practition-

ers, veterans and supporters from government,

non-profit organizations, banks, industry

research institutions and media.

Citi sees financial knowledge and skill sets as an important life skill. This, cou-pled with our expertise in this space, made us decide to support an extensive array of financial education programs that have to date benefitted 13,000 chil-dren and youth in 2013 alone.

GIVING BACKTO THE COMMUNITY

We and our NGO partners are heartened by the

changes we have witnessed in their financial

behaviors, like developing personal monthly

budget and maintaining monthly expenditure

report.

The Agent Penny program was launched in 2007

and expanded in 2009 with NGO Shanghai Better

Education Development Center (Better Education)

in a bid to promote financial literacy to upper

primary school students through innovative meth-

ods.

The program illustrates basic financial concepts

such as financial planning, smart spending and

saving, in interesting and easy-to-absorb ways:

cartoons, comic books, skits performed by the

students themselves and competitions, and in and

out-of-school activities. Of note, the cartoon series

was a new channel introduced in December 2013,

consisting of 32 episodes, nine of which were

dubbed in local dialects by Citi volunteers.

Funded by Citi Foundation, the Awards have since

become the largest and most influential event for

Chinese microfinance practitioners. Besides being

a platform for them to network and learn, the

Awards are highly regarded as an industry yard-

stick for success. In fact, this year’s Awards com-

mittee received the highest number of applications

to date, with 165 applications for Institutional

Awards from 23 provinces, and an overwhelming

100 individuals competing for the Microentrepre-

neur of the Year Award.

GIVING BACK TO THE COMMUNITY14 15

Financial Stability andEnterprise Development

Case Study: Guizhou Indigenous Craftwork Development Program

Case Study: Chongqing Rural Small Enterprise Development Program

Citi focuses on initiatives that address key community needs – financial stabili-ty, enterprise development and neigh-borhood revitalization – while fostering innovation and providing thought lead-ership.

We also collaborate with external stakeholders to

address these economic issues through impactful,

multiyear public-private partnerships that include

nonprofit partners and local governments.

In China, we pay particular attention to disas-

ter-stricken and poor villages. We desire to create

effective and sustainable vehicles to help the com-

munities to reap triple benefits – economic, envi-

ronmental and social. We do so by building their

living quarters, increasing their income levels by

way of establishing or expanding household and

micro enterprises, coaching them on adopting

better and greener farming practices and technol-

ogy, and expanding their market access, while

preserving their indigenous traditional cultural

heritage like art and agriculture.

Citi also recognizes that solutions to many com-

plex community challenges require sustained

investment and collaboration over time. Here are

some examples of how our long-term commit-

ments have made a real difference:

In November 2013, we celebrated the program’s

third anniversary with an event with our partners,

during which we shared with attendees our

program model, learnings, experiences and the

sustainable impact generated. We also supported

the launch of the Guizhou Absolute Cultural Week

and 2013 Absolute Guizhou exhibition, where the

Since late 2010, Citi has been partnering with a

humanitarian organization Humana People to

People (HPP) to economically empower impover-

ished and low income residents of rural Chongqing

in a sustainable way.

The program was first incepted in Wanzhou district,

teaching the farmers from small and growing

household enterprises technical and practical skills

like sustainable agricultural production, animal

husbandry, rudimentary finance and marketing. We

also built an effective and sustainable training

model for local farmers to become skilled farming

instructors, and established farmers’ clubs that

conduct systematic training and support activities

With this resounding success, Citi and HPP will

replicate the program in Haokou, Wulong district

come January 2014.

Guizhou, a rural province located in southwest

China, is tknown for its indigenous artisans, mostly

from the Miao minority group.

In 2011, Citi China partnered with the Communi-

ty-Based Conservation and Development Research

Center of Guizhou (CCDRC) to launch the Guizhou

Indigenous Batik Development Program. The

program has since expanded to more craftworks in

the province, which explains the program’s more

encompassing name today.

The program sought to enhance the artisans’

production and marketing skills so that they can

make a better living. We also established sales

centers where the artisans are able to negotiate

prices, expand their sales channels i.e. new

markets.

Overall success would call upon strong collabora-

tion not only between Citi and CCDRC, but also

from other corporations, grass-root organizations

and the local government.

The results to date speak for themselves:

Over 2,000 household enterprises (7,000

individuals) have witnessed their income levels

increase by 30-40 percent year-over-year.

The program has received wild acclaim, winning

several of the nation's top community develop-

ment awards.

The sustainable success and impact of the

program has drawn attention not only from

within the Guizhou Province, but also from its

neighbors, renowned experts, designers and the

industry’s influencers.

70 percent of program household enterprises

have indicated an increase in their average

annual income by 30 percent.

1,853 household enterprises (7,096 individuals)

from five villages in the district received the

technical and field trainings.

A total of 127 training sessions have been

conducted for 19,561 farmers cumulatively.

Citi donated fruit and nut trees to 120 house-

hold enterprises to further generate an

estimated additional annual profit of at least

RMB 920,000 for 20 years when trees are in

full production.

Community development funds were estab-

lished to support 62 income generating

sub-projects, bringing additional 10 percent of

income increase to 847 participating families.

Chongqing is Guizhou’s neighboring province, in

southwest China. Most of its population are farm-

ers as agriculture remains significant.

artisans also got a chance to showcase their

talents and products.

to derive greater impact for the farmers.

In August 2013, Citi and HPP announced the com-

pletion of the project. The achievements are

impressive:


Youth Educationand Livelihood

Young Talent Development

Citi Forum

Our grants, funded by Citi Foundation, support programs that aim to increase the number of low-income, migrant, youth who, based on their skills, become employed, start their own income-gen-erating business or obtain higher edu-cation or training.

Youth ages 13–25 represent a growing percentage

of the Chinese population.

In 2013, Citi China renewed our commitment for

the third year, to the BN Vocational School (BNVS)

and Safe the Children to provide complimentary

training to migrant students who hope to gain

academic knowledge (English, Chinese, Math),

vocational (electrical maintenance, western pastry

and hospitality services) and life skills (profession-

al etiquette, Chinese traditional culture, communi-

cations, self-confidence or conflict management)

to secure skilled-based employment and the oppor-

tunity to break their families’ poverty cycle.

Continued our Management Associate (MA)

Summer Internship program – the Citi Future

Elite Summer Camp – with structured orienta-

tion, soft skill trainings, speaker series, and an

offsite camp to equip students with more infor-

Continued hosting Banking Courses in Beijing

University and Fudan University over ten weeks

each. The universities have expressed gratitude

to Citi China for hosting the courses and shared

positive feedback from the students. As of 2013,

Beijing University has also made the Citi Bank-

ing Course as a compulsory subject for all

Finance majors.

Universum’s Student’s Ideal Employer Survey

which ranked Citi 4th among business students,

with our brand, training and development

opportunities, and harmonious teamwork being

the top reasons.

ChinaHR’s 11th Best Employers of China placed

us at the top among foreign banks, second in

the investment banking and securities industry,

and 14th in the overall ranking, a stark improve-

ment from the previous year’s rank at 40.

In 2013, Citi China continued to sponsor five

scholarships in various educational institutions

and competitions.

Citi believes in nurturing the next generation of

talent who will be the main contributors to our

economy.

We continue to cooperate with top universities to

sponsor, train, and recognize young talent through

various programs. In 2013, we:

IndustryRecognition

2013 was the 10th year that Citi sponsored the Sun

Yat-sen University Management School’s Citi

Forum which saw the largest number of partici-

pants ever. Citi Forum attracts numerous students

and scholars from local top universities with its

unique form and original content.

Citi China’s efforts in this area have been recog-

nized by third parties, including:

mation, knowledge and experience about the

finance industry, so that they will be better

prepared for the real world upon graduation

later that year.


Best Bank in China (for the 7th year)The Asset

Best Foreign Bank

JRJ.com and Tsinghua PBCSF, Tsinghua University

Most Competitive Foreign Bank China Business Journal

Best Cash Management Bank

The Corporate Treasurer

World’s Best Consumer Internet BankBest Foreign Consumer Credit CardBest Foreign Equity Underwriting

Global Finance

Asian Large Corporate Banking QualityAsian Large Corporate Cash Management Quality

Greenwich Associates

Best Banking Customer Service Center Shanghai Banking Association

Annual Financial Statistical EvaluationPeople’s Bank of China

Student’s Ideal Employer Survey’s 4th MostIdeal Employer

Universum

11th Best Employers of China Awards’ 14th

Best Employer in China

ChinaHR

2013 Lujiazui Warm-hearted FinanceChina Business News (CBN)

Citizenship Awards

Outstanding Program Award

China Philanthropy Times2013 CSR Awards

2013 Collection of China and ForeignEnterprises' Outstanding International

CSR Cases2013 Poverty Alleviation Ambassador

China Foundation for Poverty Alleviation

Best Innovation in Charity AwardBest Charitable Program Award

China Charity Festival

Pudong Charity AwardShanghai Pudong Charity United

2013 Best Green Angel Award

Shanghai Oasis Ecological Conservationand Communication Center

AWARDS ANDRECOGNITION

20

CITI’S MISSION &KEY PRINCIPLES

Citi’s Mission: Enabling Progress

One team, with one goal: serving our clients and stakeholders

Conduct that is transparent, prudent and dependable

Talented people with the best training who thrive in a diverse meritocracy that demands excellence, initiative and courage

key principlesthat guide usas we perform our mission are:

CommonPurpose

ResponsibleFinance

Ingenuity

Leadership

Enhancing our clients’ lives through innovation that harnesses the breadth and depth of our information, global network and world-class products

Citi works tirelessly to serve individuals, communities, institutions and nations. With more than 200 years of experience meeting the world’s tough-est challenges and seizing its greatest opportunities, we strive to create the best outcomes for our clients and customers with financial solutions that are simple, creative and responsible. An institution connecting over 1,000 cities, 160 countries and millions of people, we are your global bank; we are Citi.

CITI’S MISSION & KEY PRINCIPLES 21 22

BRANCH NETWORK -BRANCHES

16-18F, Excel Center, No.6 Wu Ding Hou Street, Xi Cheng District, Beijing, P.R.China 100032 Tel: (8610) 59376000 Fax: (8610) 59376002

01 BEIJING

2F, No.110, Furong Middle Road, 2nd Section, Changsha, P.R.China 410015 Tel: (86731)89860518 Fax: (86731)89860488 02 CHANGSHA

Unit A-E, 30/F, City Tower,No.86 Section 1 Renminnan Road Sichuan, P.R.China 610016 Tel: (8628) 86110066 Fax: (8622) 86202160

03 CHENGDU

GroundUnit 1~3, 12, 18F, No 38, Qingnian Rd, International Trade Center, Yuzhong district, Chongqing, P.R.China 400010 Tel: (8623) 63106395 Fax: (8623) 63106312

04 CHONGQING

06 GUANGZHOU

Unit 12, 01-03, 18F, Wanda Center, No 6, Gangxing Road, Zhongshan District, Dalian, P.R.China 116001 Tel: (86411) 39763976 Fax: (86411) 39027599

05 DALIAN

Unit 1-01, No 215, Fushui South Road, Nanming District, Guiyang,P.R.China 550002Tel:(86851)5285888 Fax:(86851)5258009

07 GUIYANG

08 HANGZHOU

09 NANJING

10 SHANGHAI

11 SHENZHEN

12 TIANJIN

13 WUXI7201-7202, Office Tower, CITIC Plaza, No.233 Tian He North Road, Guangzhou, P.R.China 510613 Tel: (86755) 82371888 Fax: (86755) 25988829

13 Floor Unit A, B, G, Jia De Plaza, No. 118 Qing Chun Road, Hangzhou, P.R. China 310003 Tel: (86571) 87229088 Fax: (86571) 87222827

1F-2F, Nanjing World Trade Center, No. 2 Hanzhong Road, Nanjing, P.R.China 210005 Tel:(8625)88011088 Fax:(8625)89602700

No.33 Hua Yuan Shi Qiao Road, Lu Jia Zui Finance and Trade Area, Shanghai, P.R.China 200120 Tel: (8621) 28966000

34F, Duty Free Building, No. 6 1st Fu Hua Road, Fu Tian CBD, Shenzhen, P.R.China 518048Tel: (86755) 82371888 Fax: (86755) 25988829

Room 1801, 18/F, The Exchange Tower, No.189 Nanjing Road, Heping Destrict, Tianjin, P.R.China 300051 Tel: (8622) 58900988 Fax: (8622) 83191688

14 XIAMENRoom 208, Holiday Inn Crown Plaza, No. 12-8 Zhenhai Road, Xiamen, P.R.China 361001 Tel: (8622) 58900988 Fax: (8622) 83191688

1F, 2F, & unit 0701-0703, 0712, 0715-0722, 7F, No.218, Jin Jiang Hotel,Zhongshan Road,Wuxi, P.R.China 214002Tel: (86592) 2133751, 2029832, 2023333 ext. 208 Fax: (86592) 2133752

BRANCH NETWORK - BRANCHES23 24

BRANCH NETWORK -CONSUMER OUTLETS

Shanghai Branch1/F Citigroup Tower, No.33 Hua Yuan Shi Qiao Road, Lu Jia Zui Finance andTrade Area, Shanghai, P.R.China 200120 Tel: 8621) 28963333 Fax: (8621) 28963590

Shanghai Lujiazui Sub-branch1/F, Marine Tower, No.1 PuDong Avenue, Shanghai, P.R.China 200120 Tel: (8621) 38627188 Fax: (8621) 68860028

Shanghai Gu Bei Sub-branch1F Unit 102, Golden Garden, No.1078, Gubei Road, Shanghai, P.R.China 201103 Tel: (8621) 38627488 Fax: (8621) 62709509

Shanghai Xujiahui Sub-branchNo 955-5, Zhao jia Bang Road, Shanghai, P.R. China 200030 Tel: (8621)38627511 Fax: (8621)54246182

Shanghai Zhongshan Park Sub-branchUnit 1055, Ground Floor, Cloud 9 Mall, No.1018 Chang Ning Road, Shanghai, P.R. China 200042 Tel: (8621) 38627222 Fax: (8621) 62121520

Shanghai Hongkou Sub-branchUnit 605-608 6F and Unit 707-708 7F and Unit 803A, 806, 807 8F and Unit 103, 1F, No.1500, North Sichuan Road, P.R.China 200080Tel: (8621) 26012288 Fax: (8621) 63071396

Shanghai Puxi Sub-branch1/F, North Building, Peace Hotel, No.19 Zhong Shan Dong Yi Road, Shanghai, P.R.China 200002 Tel: (8621) 38627000 Fax: (8621) 63297676

01 SHANGHAIShanghai Yalong Plaza Sub-branchUnit S01, 1F and Unit S13, B2, No.500, East Jinling Road,Shanghai, P.R.China 200021 Tel: (8621) 38627333 Fax: (8621) 63732685

Shanghai Xin Tian Di Sub-branchUnit F, Building 1-6, No 222, Madang Road, Luwan District, Shanghai, P.R.China 200021 Tel: (8621) 38627588 Fax: (8621) 53068396

Shanghai West Yan An Road Sub-branchUnit 01, 02, 7F, unit 01 02, 2F and unit 01, 1F, No 500, West Yan An Road, Shanghai, P.R.China 200050 Tel: (8621) 38627388 Fax: (8621) 32200960

Shanghai West Nanjing Road Sub-branchUnit A, 1F and 2F, No 762, West Nanjing Road, Shanghai, P.R.China 200040 Tel: (8621) 28963188 Fax: (8621) 68860028

Beijing BranchRoom 101, 1st Floor, Excel Centre, No.6 Wu Ding Hou Street, Xi Cheng District, Beijing, P.R.China 100032 Tel: (8610) 59376700 Fax: (8610) 59376729

Beijing Chang-an Sub-branch1/F, Tower 1, Bright China Chang An Building, No.7 Jianguomennei Avenue, Beijing, P.R.China 100005 Tel: (8610) 59379366 Fax: (8610) 65102450

Shanghai People Square Metro Station Sub-branchUnit 1-116, Interchange Hall, People Square Station, Shanghai Metro Line 1 Shanghai, P.R.China 200021 Tel: (8621) 38627600 Fax: (8621) 22057282

02 BEIJING

BRANCH NETWORK - CONSUMER OUTLETS25 26

BRANCH NETWORK - CONSUMER OUTLETS

Beijing Zhong Guan Cun Sub-branchRoom 04 & 05, 1st Floor, Ideal Plaza, No. 58 West Road, North Fourth Ring, Haidian District, Beijing, P.R.China 100080 Tel: (8610) 59379288 Fax: (8610) 82607211

Kerry Centre Sub-branchUnit 201, 2F, North Office Building and Unit 02, 1F,Kerry Center, No.1 Guang Hua Road, Chao Yang District, Beijing, P.R.China 100020 Tel: (8610) 59379000 Fax: (8610) 85298755

Beijing Pacific Century Sub-BranchUnit 109, First Floor, Pacific Century Shopping Mall, Jia 2 Gongti North Road, Beijing, P.R.China, 100027 Tel: (8610) 59379200 Fax: (8610) 65392716

Beijing Asian Games Village Sub-branchUnit 1012, 1013, Tower C, No 103, Huizhongli, Chaoyang District, Beijing, P.R.China, 100027 Tel: (8610) 59379050 Fax: (8610) 84871619

Beijing Jin Bao Jie Sub-branchRoom F1-1, F1-2, CITS Plaza shopping center, No.1 North Dong Dan Street,Dong Cheng District, Beijing, P.R.China 100005 Tel: (8610) 59379188 Fax: 65597386

Beijing Wangjing Sub-branchUnit 105, No. 429 Wangjing Xiyuan, Guangshun North Street, Chaoyang, Beijing, P.R.China,100102 Tel: (8610) 59379333 Fax:(8610) 64716804

Beijing Upper East Side Sub-branchA09-A15, Upper East Side Central Plaza, No.6 North Ave,East 4th Ring Road, Chaoyang District, Beijing, P.R.China 100016 Tel: (8610) 59379100 Fax: (8610) 51307131

Guangzhou Fortune Plaza Sub-branchUnit 101, Fortune Plaza, No.118 TiYu East Road, Tian He District,Guangzhou, P.R.China 510620Tel: (8620) 38171888 Fax: (8620) 38931628

Guangzhou Huan Shi Dong Sub-branch1/F, Asian International Hotel, No.326 Huanshidong Road,Guangzhou, P.R. China 510133Tel: (8620) 38171021 Fax: (8620) 83866918

Guangzhou Nong Jiang Suo Sub-branchUnit 3, 1F, No 34-2, Zhongshan Fourth Road,Yuexiu District , Guangzhou, Guangdong, P.R. China,510030Tel: (8620) 38171688 Fax: (8620) 83893730

Shenzhen Shum Yip Sub-branch1/F, Shum Yip Center (Beside the Book City),No. 5045 Shen Nan East Road, Shenzhen, P.R.China 518010Tel: (86755) 22945188 Fax: (86755) 82083401

Shenzhen Futian Sub-branchRoom 105, Duty Free Building,Yitian Road, Futian District, Shenzhen, P.R.China 518048Tel: (86755) 8276633 Fax: (86755) 88820518

Shenzhen Nanshan Sub-branchNorth 1F, Jinhai Building,No.2748, Nanhai Avenue, Nanshan District, Shenzhen, P.R.China 518054Tel: (86755) 86122988 Fax: (86755) 86121161

Guangzhou Wanguo Plaza Sub-branchUnit 1002, 1st Floor, No.131,133,135,137, Jiangnan Middle Avenue,Haizhu District,Guangzhou, Guangdong, P.R. China 510220Tel: (8620) 38171099 Fax: (8620) 84499860

03 GUANGZHOU

04 SHENZHEN

27 28


Shenzhen Chegongmiao Sub-branchPodium 101-B103, NEO Lvgen Plaza, Che Gong Miao, Shennan Avenue, Futian District, Shenzhen, P.R.China 518010Tel: (86755) 82718199 Fax: (86755) 82777282

Shenzhen Luohu Sub-branchNo. 2041-1, 1st Floor, Xi Long Building, Renmin South Road, Luohu,Shenzhen, P.R.China 518001Tel: (86755) 82257866 Fax: (86755) 82235166

Chengdu Fund International Plaza Sub-branch1F, Unit 4~5, No 6, Hangkong Road,Wuhou District, Chengdu, P.R.China 610041Tel: (8628) 61517766 Fax: (8628) 61517878

Chengdu Dong Da Jie Sub-branchUnit A, Room 103 and 105, 1F, Building 1, No 35,Zi Dong Lou Duan, Dongdajie Street, Chengdu, P.R.China 610061Tel: (8628) 65280016 Fax: (8628) 65280019

Tianjin Sub-branchR102/1810, The Exchange Tower No.1, No.189 Nanjing Road, Heping Destrict,Tianjin, P.R.China 300051Tel: (8622) 58900688 Fax: (8622) 83191800

Tianjin Binhai Sub-branchLevel 1&2, 23 Fortune Plaza, No.21 Third Avenue, TEDA,Tianjin, P.R.China 300457Tel: (8622) 66209229 Fax: (8622) 66219980

Chengdu Sub-branchUnit 101, 1/F, City Tower, No.86 Section 1 Renminnan Road, ChengduSichuan, P.R.China 610016Tel: (8628) 86110066 Fax: (8628) 86202328

Tianjin Youyi Road Sub-branchUnit 101 & 201, Zhongfu Tower, No.1 Youyi Road,Hexi District, Tianjin, P.R.China 300201Tel: (8622) 28353003 Fax: (8622) 28350282

Tianjin Jin Tower Sub-branchUnit 3, No 160, Zhang Zi Zhong Road,Heping District, Tianjin, P.R. China 300041Tel: (8622) 58356150 Fax: (8622) 58356162

Hangzhou Sub-branchGround Floor, Jia De Plaza, No. 118 Qing Chun Road, Hangzhou, P.R. China 310003 Tel: (86571) 87229191 Fax: (86571) 87222872

Hangzhou Huanglong Sub-branchRoom 109-110, Floor 1, Jiahua International Business Center, No.15 Hangda Road, Hangzhou, P.R. China 310007 Tel: (86571) 87687028 Fax: (86571) 87687027

Hangzhou Chengxi Sub-branchNo 81, Wen Er West Road,Hangzhou, P.R.China 310012 Tel: (86571) 88250866 Fax: (86571) 88255603

Hangzhou Xin Tang Road Sub-branchUnit 110 , 111, No. 99 Xintang Road, Hangzhou, P.R.China 310020Tel: (86571) 88908018 Fax: (86571) 28972758

Tianjin Qi Xiang Tai Road Sub-branchUnit. 6, No. 89 Qi Xiang Tai Road,Hexi District, Tianjin, P.R. China 300074Tel: (8622) 83118000 Fax: (8622) 83118058

07 HANGZHOU

05 CHENGDU

06 TIANJIN

29 30

08 DALIAN

09 CHONGQING

10 GUIYANG


Dalian Branch1F, Podium Building and unit 12, 01-03, 18F , Wanda Center, No 6, Gangxing Road, Zhongshan District, Dalian, P.R.China 116001 Tel: (86411) 39075588 Fax: (86411) 39027518

Dalian Xinghai Bay Sub-branchNo 451-13, Zhongshan Road, Shahekou district, Dalian, P.R.China 116021 Tel: (86411) 39570188 Fax: (86411) 39570166

Chongqing Branch1F, No 185, and 2F, No 189, Zhonghua Rd, International Trade Center, Yuzhong district, Chongqing, P.R.China 400010 Tel: (8623) 63106395 Fax: (8623) 63106361

Chongqing Airport Sub-branchTerminal T2A (Departure Hall, beside Gate 4), Chongqing Jiangbei International Airport, P.R.China 401120 Tel: (8623) 67155079 Fax: (8623) 67155431

Chongqing Bei Cheng Tian Jie Sub-branchUnit 16, No. 12 Bei Cheng Tian Jie, Jiang bei District, P.R.China 400020 Tel: (8623) 67855956 Fax: (8623) 67857217

Guiyang BranchUnit 1-01, No 215, Fushui South Road, Nanming District, Guiyang, P.R.China 550002 Tel:(86851)5285888 Fax:(86851)5258007

Dalian Xigang Sub-branch No. 232 & 234 Zhongshan Road, Xigang District, Dalian, P.R.China 116011Tel: (86411) 83729700 Fax: (86411) 83729726

Nanjing Branch1F-2F, Nanjing World Trade Center, No. 2 Hanzhong Road, Nanjing, P.R.China 210005 Tel:(8625)88011088 Fax:(8625)89602700

Changsha Branch2F, No.110, Furong Middle Road, 2nd Section, Changsha, P.R.China 410015 Tel: (86731)89860518 Fax:(86731)89860428

Wuxi Branch1F, 2F, & unit 0701-0703, 0712, 0715-0722, 7F, No.218, Jin Jiang Hotel, Zhongshan Road,Wuxi, P.R.China 214002Tel:(86510)82799668 Fax:(86510)82750389

11 NANJING

12 CHANGSHA

13 WUXI

31 32

CITIBANK (CHINA) COMPANY LIMITED

ENGLISH TRANSLATION OF FINANCIAL STATEMENTS FOR THE YEAR FROM 1 JANUARY 2013 TO 31 DECEMBER 2013

IF THERE IS ANY CONFLICT BETWEEN THE CHINESEVERSION AND ITS ENGLISH TRANSLATION,

THE CHINESE VERSION WILL PREVAIL

33

Citibank (China) Company LimitedBalance Sheet as at 31 December 2013 (continued)(Expressed in Renminbi Yuan)

Deposits from inter-banks and

non-bank financial institution

Borrowings from inter-banks

Derivative financial liabilities

Financial assets sold under repurchase agreements

Deposits from customers

Employee benefits payable

Taxes payable

Interest payable

Other liabilities

Paid-in capital

Capital reserve

Surplus reserve

General reserve

Retained earnings

16

17

9

18

19

20

4(3)

21

22

23

24

25

20,601,138,894

10,492,510,490

2,844,811,150

-

96,624,103,633

241,120,930

214,014,543

451,104,989

9,891,133,757

3,970,000,000

(86,245,081)

702,043,313

1,476,690,285

5,325,169,617

12,308,582,670

6,751,057,744

1,430,554,047

7,920,000,000

103,566,097,380

228,251,112

180,510,101

252,270,780

9,153,222,437

3,970,000,000

33,724,090

605,631,273

1,305,394,495

4,628,757,051

Total liabilities and equity

Equity

Liabilities:

Cash on hand and deposits

with central bank

Deposits with inter-banks

Placements with inter-banks

Trading financial assets

Derivative financial assets

Interest receivable

Loans and advances to customers

Available-for-sale financial assets

Fixed assets

Intangible assets

Deferred tax assets

Other assets

5

6

7

8

9

10

1 1

12

13

14

15

26,885,794,247

7,650,815,916

30,707,510,787

3,266,961,398

2,828,654,593

520,846,457

61,387,928,396

17,228,779,130

62,383,285

69,355,354

213,529,169

1,925,037,788

30,637,522,420

12,786,085,145

23,311,688,269

3,512,945,036

1,690,055,766

457,176,967

62,950,509,681

16,135,172,130

74,135,564

80,561,003

95,285,122

602,916,077

Assets

Total assets

Note 2013 2012

152,747,596,520 152,334,053,180

Citibank (China) Company LimitedBalance Sheet as at 31 December 2013(Expressed in Renminbi Yuan)

Note 2013 2012

Total equity

Total liabilities 141,359,938,386 141,790,546,271

11,387,658,134 10,543,506,909

152,747,596,520

The notes on pages 8 to 82 of these financial statements. The notes on pages 8 to 82 form part of these financial statements.

These financial statements were approved by the Board of Directors.

Date：14 Apr 2014

Andrew Au

Chief Executive Officer

152,334,053,180

Kai Zhang

Chief Financial Officer

Company stamp

34 35

Citibank (China) Company LimitedCash Flow Statement for the year ended 31 December 2013(Expressed in Renminbi Yuan)

Note 2013 2012 Note 2013 2012

Citibank (China) Company LimitedIncome Statement for the year ended 31 December 2013(Expressed in Renminbi Yuan)

The notes on pages 8 to 82 form part of these financial statements. The notes on pages 8 to 82 form part of these financial statements.

Operating income 4,352,882,044 4,628,461,238

Net interest income 27 2,602,809,464 2,690,207,368 Interest income 4,393,500,690 4,408,561,165

Interest expenses (1,790,691,226) (1,718,353,797)

Net fee and commission income 28 617,919,568 497,422,633

Fee and commission income 713,879,351 590,755,963

Fee and commission expenses (95,959,783) (93,333,330)

Investment income 29 736,869,649 908,881,187

(Losses) / gains from changes in fair value 30 (266,550,720) 34,477,582

Foreign exchange gains 626,739,267 342,775,514

Other operating income 35,094,816 154,696,953

Operating expenses (3,125,942,378) (2,811,830,342)

Business taxes and surcharges 4(1) (242,237,669) (270,559,583)

General and administrative expenses 31 (2,715,335,079) (2,547,727,861)

Impairment losses (charge) / reversal 32 (168,369,630) 6,457,102

Operating profit 1,226,939,666 1,816,630,896

Add: Non-operating income 6,634,513 15,001,545

Less: Non-operating expenses (2,649,273) (3,651,857)

Profit before income tax 1,230,924,906 1,827,980,584

Less: Income tax expense 4(2)/33 (266,804,510) (454,767,618)

Net profit for the year 964,120,396 1,373,212,966

Net profit for the year 964,120,396 1,373,212,966

Other comprehensive income for the year 34 (119,969,171) 23,366,677

Total comprehensive income for the year 844,151,225 1,396,579,643

Net decrease in deposits with central bank

and inter-banks

95,488,384 -

Net decrease in loans and advances to customers 3,078,658,961 -

Net increase in borrowings from inter-banks

and non-bank financial institutions - 6,780,294,763

Net increase in deposits from customers

and inter-banks

1,350,562,477 16,494,135,837

Cash received from returns on trading

financial assets

29,395,650 209,516,790

Cash received from disposals of trading

financial assets

- 1,734,284,034

Interest, fee and commission receipts 5,001,433,123 5,119,753,866

Refund of taxes 5,687,000 12,872,000

Cash received relating to other operating activities 532,657,662 170,908,408

Sub-total of cash inflows from operating activities 10,093,883,257 30,521,765,698

--------------------- ---------------------

Net increase in deposits with central bank

and inter-banks - (349,478,616)

Net increase in loans and advances to customers - (5,040,275,260)

Net decrease in borrowings from inter-banks

and non-bank financial institutions (10,255,221,634) -

Cash paid for acquisition of trading financial assets (790,357,194) -

Interest, fee and commission payments (1,687,816,800) (1,754,454,271)

Cash paid to and for employees (1,381,371,282) (1,188,576,641)

Cash paid for all types of taxes (888,425,895) (1,072,285,865)

Cash paid relating to other operating activities (52,057,594) (71,264,868)

Sub-total of cash outflows from operating

activities (15,055,250,399) (9,476,335,521)

--------------------- ---------------------

Net cash (outflow) / inflow from

operating activities 35(1) (4,961,367,142) 21,045,430,177

--------------------- ---------------------

Cash flows from operating activities

36 37

Citibank (China) Company LimitedCash Flow Statement for the year ended 31 December 2013 (continued)(Expressed in Renminbi Yuan)

Citibank (China) Company LimitedStatement of Changes in Equity for the year ended 31 December 2013(Expressed in Renminbi Yuan)

Note 2013 2012 Note

The notes on pages 8 to 82 form part of these financial statements. The notes on pages 8 to 82 form part of these financial statements.

Cash flows from investing activities

Cash received from disposals of investments 11,283,281,490 4,796,060,687

Cash received from returns on investments 573,694,845 510,158,540

Cash received from disposals of fixed assets 103,000 -

Sub-total of cash inflows from investing

activities 11,857,079,335 5,306,219,227

--------------------- ---------------------

Cash paid for acquisition of investments (11,587,141,324) (9,492,476,412)

Cash paid for acquisition of fixed assets,

intangible assets and other

long-term assets (55,916,647) (121,278,910)

Sub-total of cash outflows from investing

activities (11,643,057,971) (9,613,755,322)

--------------------- ---------------------

Net cash inflow / (outflow) from investing

activities 214,021,364 (4,307,536,095)

--------------------- ---------------------

Effect of foreign exchange rate changes

on cash and cash equivalents (507,423,612) (9,570,523)

--------------------- ---------------------

Net (decrease) / increase in cash and cash

equivalents 35(2) (5,254,769,390) 16,728,323,559

Add: Cash and cash equivalents at the

beginning of the year 40,544,135,948 23,815,812,389

Cash and cash equivalents at the end

of the year 35(3) 35,289,366,558

40,544,135,948

Balance at 1 January 2013 3,970,000,000 33,724,090 605,631,273 1,305,394,495 4,628,757,051 10,543,506,909

------------------- ------------------- ------------------- ------------------- ------------------- -------------------

Changes in equity for the year

1. Net profit for the year

- - - - 964,120,396 964,120,396

2. Other comprehensive

income 34 - (119,969,171) - - - (119,969,171)

Subtotal of 1 and 2 - (119,969,171) - - 964,120,396 844,151,225

------------------- ------------------- ------------------- ------------------- ------------------- -------------------

3. Appropriation of profits

- Appropriation for

surplus

reserve 24, 26 - - 96,412,040 - (96,412,040) -

- Appropriation for

general

reserve 25, 26 - - - 171,295,790 (171,295,790) -

Balance at

31 December 2013 3,970,000,000 (86,245,081) 702,043,313 1,476,690,285 5,325,169,617 11,387,658,134

Surplusreserve

Generalreserve

Retainedearnings

Total

Capitalreserve

paid-incapital

38 39

Citibank (China) Company LimitedStatement of Changes in Equity for the year ended 31 December 2012 (continued)(Expressed in Renminbi Yuan)

Citibank (China) Company LimitedNotes to the Financial Statements(Expressed in Renminbi Yuan)

(1) Statement of compliance

01 General information

The notes on pages 8 to 82 form part of these financial statements.

Balance at 1 January 2012

Changes in equity for the year

1. Net profit for the year

2. Other comprehensive

income

Subtotal of 1 and 2

3. Appropriation of profits

- Appropriation for

surplus reserve

- Appropriation for

general reserve

Balance at

31 December 2012

Surplusreserve

Capitalreserve

paid-incapital

Generalreserve

Retainedearnings TotalNote

3,970,000,000 10,357,413 468,309,977 818,441,173 3,879,818,703 9,146,927,266

------------------- ------------------- ------------------- ------------------- ------------------- -------------------

- - - - 1,373,212,966 1,373,212,966

34 - 23,366,677 - - - 23,366,677

- 23,366,677 - - 1,373,212,966 1,396,579,643

------------------- ------------------- ------------------- ------------------- ------------------- -------------------

24, 26 - - 137,321,296 - (137,321,296) -

25, 26 - - - 486,953,322 (486,953,322) -

3,970,000,000 33,724,090 605,631,273 1,305,394,495 4,628,757,051 10,543,506,909

Citibank (China) Company Limited (Citibank China or the

Bank) is a wholly foreign-owned bank incorporated in

Shanghai, the People’s Republic of China (PRC), estab-

lished by Citibank, N.A. (Citibank or the Investor).

With the approval of the China Banking Regulatory Com-

mission (the CBRC) issued on 22 December 2006, Citib-

ank transformed its Shanghai Branch, Shenzhen Branch,

Guangzhou Branch, Beijing Branch, Tianjin Branch and

Chengdu Branch which were set up in China during 1988

to 2005 into Citibank China, a wholly foreign-owned

bank invested solely by Citibank.

The Bank obtained a financial license on 20 March 2007

and a business license (qi du hu zong zi No. 043865)

[Municipal Bureau] issued by the Shanghai Administra-

tion of Industry and Commerce on 29 March 2007, and

subsequently obtained a revised license (No.

310000400507900) [Municipal Bureau] from the

Shanghai Administration of Industry and Commerce

after commencement of operation. The Bank’s regis-

tered capital is Renminbi 3,970,000,000. In accordance

with the Bank’s business license, the Bank has an unde-

fined operating period from 29 March 2007. The Bank

commenced operation on 2 April 2007 and its scope of

operation includes partial or full scope foreign currency

business and Renminbi business, approved by relevant

regulators.

As at 31 December 2013, the Bank had 13 branches and

41 sub-branches in Shanghai, Shenzhen, Guangzhou,

Beijing, Tianjin, Chengdu, Hangzhou, Dalian, Chongqing,

Guiyang, Nanjing, Changsha, and Wuxi.

These financial statements have been translated into

The financial statements have been prepared in accord-

ance with the requirements of “Accounting Standards

for Business Enterprises – Basic Standard” and 38

Specific Standards issued by the Ministry of Finance

(MOF) of PRC on 15 February 2006, and application

guidance, bulletins and other relevant regulations

issued subsequently (collectively referred to as

“Accounting Standards for Business Enterprises” or

“CAS”). These financial statements present truly and

completely the financial position of the Bank as at 31

December 2013, financial performance and the cash

flows of the Bank for the year then ended.

The Bank’s accounting year is from 1 January to 31

December.

The measurement basis used in the preparation of the

financial statements is historical cost basis except for

the assets and liabilities set out below:

Financial assets and financial liabilities at fair value

through profit or loss (including financial assets or

financial liabilities held for trading) (see Note 3(2)).

Available-for-sale financial assets (see Note 3(2)).

02 Basis of preparation

(2) Accounting year

(3) Measurement basis

English from the Bank’s statutory financial statements

issued in the PRC in Chinese.

The financial statements have been prepared on the

basis of going concern.

40 41

A financial asset or financial liability is recognised in the

balance sheet when the Bank becomes a party to the

contractual provisions of a financial instrument.

The Bank classifies financial assets and liabilities into

the different categories at initial recognition based on

the purpose of acquiring assets or assuming liabilities:

financial assets and financial liabilities at fair value

through profit or loss, loans and receivables,

held-to-maturity investments, available-for-sale finan-

cial assets and other financial liabilities.

Financial assets and financial liabilities are measured

initially at fair value. For financial assets and financial

liabilities at fair value through profit or loss, any related

directly attributable transaction costs are charged to

profit or loss; for other categories of financial assets

and financial liabilities, any related directly attributable

transaction costs are included in their initial costs.

Subsequent to initial recognition, financial assets and

liabilities are measured as follows:

Financial assets and financial liabilities at fair value

through profit or loss (including financial assets or

financial liabilities held for trading)

A financial asset or financial liability is classified as at

fair value through profit or loss if it is acquired or

incurred principally for the purpose of selling or repur-

chasing in the near term or if it is a derivative. Subse-

quent to initial recognition, financial assets and financial

liabilities at fair value through profit or loss are meas-

ured at fair value, and changes therein are recognised in

profit or loss.

Loans and receivables

Loans and receivables are non-derivative financial

assets with fixed or determinable payments that are not

quoted in an active market. Subsequent to initial recog-

nition, loans and receivables are measured at amortised

cost using the effective interest method.

Held-to-maturity investments

Held-to-maturity investments are non-derivative finan-

cial assets with fixed or determinable payments and

fixed maturity that the Bank has the positive intention

and ability to hold to maturity. Subsequent to initial

recognition, held-to-maturity investments are measured

at amortised cost using the effective interest method.


Available-for-sale financial assets include non-deriva-

tive financial assets that are designated upon initial

recognition as available for sale and other financial

assets which do not fall into any of the above categories.

Available-for-sale investments in equity instruments

whose fair value cannot be measured reliably are meas-

ured at cost subsequent to initial recognition. Other

available-for-sale financial assets are measured at fair

value subsequent to initial recognition and changes

therein, except for impairment losses and foreign

exchange gains and losses from monetary financial

assets which are recognised directly in profit or loss, are

recognised as other comprehensive income in capital

reserve. When an investment is derecognised, the cumu-

lative gain or loss is reclassified from equity to profit or

loss. Interest on available-for-sale financial assets calcu-

lated using the effective interest method is recognised

in profit or loss.

Other financial liabilities

Financial liabilities other than financial liabilities at fair

value through profit or loss are classified as other finan-

cial liabilities.

Other financial liabilities include the liabilities arising

from financial guarantee contracts. Financial guaran-

tees are contracts that require the Bank (i.e. the guaran-

tor) to make specified payments to reimburse the bene-

ficiary of the guarantee (the holder) for a loss the holder

incurs because a specified debtor fails to make payment

when due in accordance with the terms of a debt instru-

ment. Where the Bank issues a financial guarantee,

subsequent to initial recognition, the guarantee is meas-

ured at the higher of the amount initially recognised less

accumulated amortisation and the amount of a provi-

sion determined in accordance with the principles of

The Bank’s functional currency is Renminbi. These

financial statements are presented in Renminbi. Func-

tional currency is determined by the Bank on the basis

of the currency in which major income and costs are

denominated and settled.

When the Bank receives capital in foreign currencies

from investors, the capital is translated to Renminbi at

the spot exchange rate on the date of receipt. Other

foreign currency transactions are, on initial recognition,

translated to Renminbi at the spot exchange rates on

the dates of the transactions. A spot exchange rate is an

exchange rate quoted by the People’s Bank of China (the

PBOC), the State Administration of Foreign Exchanges

or a cross rate determined based on quoted exchange

rates.

Monetary items denominated in foreign currencies are

translated to Renminbi at the spot exchange rate at the

balance sheet date. The resulting exchange differences

are recognised in profit or loss. Non-monetary items

denominated in foreign currencies that are measured at

historical cost are translated to Renminbi using the

foreign exchange rate at the transaction date. Non-mon-

etary items denominated in foreign currencies that are

measured at fair value are translated using the foreign

exchange rate at the date the fair value is determined;

the resulting exchange differences are recognised in

profit or loss, except differences arising from the trans-

Financial instruments of the Bank include cash on hand

and deposits with central bank, deposits with

inter-banks, placements with inter-banks, trading finan-

cial assets, derivative financial assets, interest receiva-

ble, loans and advances to customers, available-for-sale

financial assets, deposits from inter-banks and non-bank

financial institutions, borrowings from inter-banks,

derivative financial liabilities, financial assets sold under

repurchase agreements, deposits from customers,

employee benefits payable, interest payable and paid-in

capital.

(a) Recognition and measurement of financial assets

and financial liabilities

(4) Functional currency and presentation currency

(1) Translation of foreign currencies

(2) Financial instruments

03 Significant accounting polices and accounting estimates

lation of available-for-sale financial assets, which are

recognised as other comprehensive income in capital

reserve.

4342

Financial assets and financial liabilities are presented

separately in the balance sheet and are not offset. How-

ever, a financial asset and a financial liability are offset

and the net amount is presented in the balance sheet

when both of the following conditions are satisfied:

the Bank has a legal right to set off the recognised

amounts and the legal right is currently enforceable;

and

the Bank intends either to settle on a net basis, or to

realise the financial asset and settle the financial liability

simultaneously.

A financial asset is derecognised if the Bank’s contractu-

al rights to the cash flows from the financial asset expire

or if the Bank transfers substantially all the risks and

rewards of ownership of the financial asset to another

party. Where a transfer of a financial asset in its entirety

meets the criteria of derecognition, the difference

between the two amounts below is recognised in profit

or loss:

the carrying amount of the financial asset transferred

the sum of the consideration received from the trans-

fer and any cumulative gain or loss that has been recog-

nised directly in equity.

The Bank derecognises a financial liability (or part of it)

only when the underlying present obligation (or part of

it) is discharged, cancelled or expires.

Cash and cash equivalents comprise cash on hand,

non-restricted balances with central banks, deposits

with inter-banks, placements with inter-banks, and

short-term, highly liquid investments, which are readily

convertible into known amounts of cash and are subject

to an insignificant risk of change in value.

The cost of fixed assets, less its estimated residual value

and accumulated impairment losses, is depreciated

using the straight-line method over its estimated useful

life, unless the fixed assets are classified as held for sale.

The estimated useful lives, residual value rates and

depreciation rates of each class of fixed assets are as

follows:

Financial assets sold under repurchase agreements are

recorded as the amount actually received when the

transactions occur, and are carried in the balance sheet.

The underlying assets of the repurchase agreements

continue to be recorded in the balance sheet and meas-

ured accordingly.

The difference between the sale and repurchase consid-

eration is amortised over the period of the respective

transaction using the effective interest method and

included in interest expenses.

Fixed assets represent the tangible assets held by the

Bank for administrative purposes with useful lives over

one year. Fixed assets are stated in the balance sheet at

cost less accumulated depreciation and impairment

losses (see Note 3(8)(b)).

An embedded derivative is a component of a hybrid

(combined) instrument that also include both the deriva-

tive and a host contract with the effect that some of the

cash flows of the hybrid (combined) instrument vary in a

way similar to a stand-alone derivative.

The embedded derivative are separated from the host

contract and accounted for as a derivative when: (i) the

economic characteristics and risks of the embedded

derivative are not closely related to the economic char-

acteristics and risks of the host contract; (ii) a separate

instrument with the same terms as the embedded deriv-

ative would meet the definition of a derivative; and (iii)

the hybrid (combined) instrument is not measured at

If there is an active market for a financial asset or finan-

cial liability, the quoted price in the active market is used

to establish the fair value of the financial asset or finan-

cial liability. If no active market exists for a financial

instrument, a valuation technique is used to establish

the fair value. Valuation techniques include using recent

arm’s-length market transactions between knowledgea-

ble, willing parties, reference to the current fair value of

another instrument that is substantially the same,

discounted cash flow analysis, option pricing models,

and etc. The Bank calibrates its valuation technique and

tests it for validity periodically.

(b) Presentation of financial assets and financial liabil-

ities

(c) Determination of fair value

(d) Derecognition of financial assets and financial

liabilities

(e) Embeded derivatives

(3) Cash and cash equivalents

(4) Financial assets sold under repur-chase agreements

(5) Fixed assets


contingencies (see Note 3(11)).

Except for the liabilities arising from financial guarantee

contracts described above, subsequent to initial recog-

nition, other financial liabilities are measured at amor-

tised cost using the effective interest method.

fair value with changes in fair value recognised in profit

or loss.

If an embedded derivative is separated, the host

contract shall be accounted for in accordance with (a)

and (b) in this notes.

The cost of a purchased fixed asset comprises the

purchase price, related taxes, and any directly attributa-

ble expenditure for bringing the asset to working condi-

tion for its intended use. The cost of self-constructed

assets includes the cost of materials, direct labour,

capitalised borrowing costs, and any other costs directly

attributable to bringing the asset to working condition

for its intended use.

Where the parts of an item of fixed assets have different

useful lives or provide benefits to the Bank in a different

pattern, thus necessitating use of different depreciation

rates or methods, each part is recognised as a separate

fixed asset.

The subsequent costs including the cost of replacing

part of an item of fixed assets, are recognised in the

carrying amount of the item if the criteria to recognised

fixed assets are satisfied, and the carrying amount of

the replaced part is derecognised. The costs of the

day-to-day servicing of fixed assets are recognised in

profit or loss as incurred. Gains or losses arising from

the retirement or disposal of an item of fixed asset are

determined as the difference between the net disposal

proceeds and the carrying amount of the item, and are

recognised in profit or loss on the date of retirement or

disposal.

44 45

Useful lives, residual value and depreciation methods

are reviewed at least at each year-end.

Rental payments under operating leases are recognised

as part of the cost of another related asset or as expens-

es on a straight-line basis over the lease term. Contin-

gent rental payments are recognised as expenses in the

accounting period in which they are incurred.

The carrying amounts of the following assets are

reviewed at each balance sheet date based on the inter-

nal and external sources of information to determine

whether there is any indication of impairment:

fixed assets

intangible assets

If any indication exists that an asset may be impaired,

the recoverable amount of the asset is estimated. In

addition, the Bank estimates the recoverable amounts

of intangible assets with indefinite useful lives that have

yet to reach a working condition at least once during

each year irrespective of whether there is any indication

of impairment.

The carrying amounts of financial assets (other than

those at fair value through profit or loss) are reviewed

at each balance sheet date to determine whether there

is objective evidence of impairment. If any such

evidence exists, an impairment loss is recognised.

Loans and receivables and held-to-maturity invest-

ments

Held-to-maturity investments are assessed for impair-

ment on an individual basis. Loans and receivables are

assessed for impairment both on an individual basis and

on a collective group basis.

Where impairment is assessed on an individual basis, an

impairment loss in respect of a loan and receivable or

held-to-maturity investment is calculated as the excess

of its carrying amount over the present value of its

estimated future cash flows (exclusive of future credit

losses that have not been incurred) discounted at the

original effective interest rate. All impairment losses are

recognised in profit or loss.

An assessment is made collectively where loans and

receivables share similar credit risk characteristics

(including those not individually assessed as impaired),

based on their historical loss experiences, and adjusted

by the observable factors reflecting present economic

conditions.

If, after an impairment loss has been recognised on

loans and receivables or held-to-maturity investments,

there is objective evidence of a recovery in value of the

financial asset which can be related objectively to an

event occurring after the impairment was recognised,

Intangible assets are stated in the balance sheet at cost

less accumulated amortisation (where the estimated

useful life is finite) and impairment losses (see Note

3(8)(b)). For an intangible asset with a finite useful life,

its cost less estimated residual value and accumulated

impairment losses is amortised on the straight-line

method over its estimated useful life, unless it is classi-

fied as held for sale. At the balance sheet date, the

Bank’s intangible assets consisted of software, which is

amortised over three to ten years.

An intangible asset is regarded as having an indefinite

useful life and is not amortised when there is no foresee-

able limit to the period over which the asset is expected

to generate economic benefits for the Bank. At the

balance sheet date, the Bank did not have any intangible

assets with indefinite useful lives.

(6) Operating lease charges

(7) Intangible assets

(8) Impairment of assets


Assettype

Estimateduseful life

Residualvalue rate

Depreciationrate

Office and other equipment 3 - 5 years 0% 20% - 33.33%

Motor vehicles 5 years 0% 20%

(a) Impairment of fiancial assets

(b) Impairment of other assets

the previously recognised impairment loss is reversed

through profit or loss. A reversal of an impairment loss

will not result in the asset’s carrying amount exceeding

what the amortised cost would have been had no impair-

ment loss been recognised in prior years.


Available-for-sale financial assets are assessed for

impairment on an individual basis. When an availa-

ble-for-sale financial asset is impaired, the cumulative

loss arising from decline in fair value that has been

recognised directly in equity is reclassified to profit or

loss even though the financial asset has not been derec-

ognised. If, after an impairment loss has been recog-

nised on an available-for sale debt instrument, the fair

value of the debt instrument increases in a subsequent

period and the increase can be objectively related to an

event occurring after the impairment loss was recog-

nised, the impairment loss is reversed through profit or

loss.

An asset group is the smallest identifiable group of

assets that generates cash inflows and that is largely

independent of the cash inflows from other assets or

asset groups. An asset group is composed of assets

directly related to cash-generation. Identification of an

asset group is based on whether major cash inflows

generated by the asset group are largely independent of

the cash inflows from other assets or asset groups. In

identifying an asset group, the Bank also considers how

management monitors the Bank’s operations and how

management makes decisions about continuing or

disposing of the Bank’s assets.

The recoverable amount of an asset, asset group or set

of asset groups is the higher of its fair value less costs to

sell and the present value of expected future cash flows.

An asset’s fair value less costs to sell is the amount

determined by the price of a sale agreement in an

arm’s-length transaction less the costs that are directly

attributable to the disposal of the asset. The present

value of the expected future cash flows of an asset is

determined by discounting the future cash flows,

estimated to be derived from continuing use of the asset

and from its ultimate disposal to their present value

using an appropriate pre-tax discount rate.

If the result of the recoverable amount calculation

indicates the recoverable amount of an asset is less

than its carrying amount, the carrying amount of the

asset is reduced to its recoverable amount. That reduc-

tion is recognised as an impairment loss and charged to

profit or loss for the current period. A provision for

impairment of the asset is recognised accordingly. For

impairment losses related to an asset group or a set of

asset groups, reduce the carrying amount of the other

assets in the asset group or set of asset groups on a pro

rata basis. However, the carrying amount of an impaired

asset will not be lower than the greatest amount of its

46 47

Employee benefits are all forms of consideration given

and other related expenditures incurred in exchange for

services rendered by employees. Except for termination

benefits, employee benefits are recognised as a liability

in the period in which the associated services are

rendered by employees, with a corresponding increase

in the cost of relevant assets or expenses in the current

period.

The Bank provides an annuity plan to the eligible

employees. The Bank makes annuity contribution in

proportion to its employees’ gross salaries, which are

expensed in profit or loss when the contributions are

made.

When the Bank terminates the employment relationship

with employees before the employment contracts

expire, or provides compensation as an offer to encour-

age employees to accept voluntary redundancy, a provi-

sion for the termination benefits to be provided is

recognised in profit or loss when both of the following

conditions are satisfied:

The Bank has a formal plan for the termination of

employment or has made an offer to employees for

voluntary redundancy, which will be implemented short-

ly;

The Bank is not allowed to withdraw from termination

plan or redundancy offer unilaterally.

Current tax and deferred tax are recognised in profit or

loss except to the extent that they relate to a business

combination or items recognised directly in equity

(including other comprehensive income).

Current tax is the expected tax payable calculated at the

applicable tax rate on taxable income for the year, plus

any adjustment to tax payable in respect of previous

years.

At the balance sheet date, current tax assets and liabili-

ties are offset if the Bank has a legally enforceable right

to set them off and also intends either to settle on a net

basis or to realise the asset and settle the liability simul-

taneously.

Deferred tax assets and liabilities arise from deductible

and taxable temporary differences respectively, being

Pursuant to the relevant laws and regulations of the

PRC, employees of the Bank participate in the social

insurance system established and managed by govern-

ment organisations. The Bank makes social insurance

contributions, including contributions to basic pension

insurance, basic medical insurance, unemployment

insurance, work-related injury insurance, maternity

insurance and etc., as well as contributions to housing

fund, at the applicable benchmarks and rates stipulated

by the government for the benefit of its employees. The

social insurance and housing fund contributions are

recognised as part of the cost of assets or charged to

profit or loss on an accrual basis. Except for the above

contributions, the Bank has no other obligations in this

respect.

Share-based payment transactions in the Bank are equi-

(9) Employee benefits

(10) Income tax


(a) Social insurance and housing fund

(b) Share-based payments

(c) Annuity plan

(d) Termination benefitsindividual fair value less costs to sell (if determinable),

the present value of expected future cash flows (if

determinable) and zero.

Once an impairment loss is recognised, it is not reversed

in a subsequent period.

ty-settled share-based payments.

Where the Bank uses shares or other equity instruments

as consideration for services received from employees,

the payment is measured at the fair value of the equity

instruments granted to the employees. If the equity

instruments granted to employees vest immediately,

the fair value of the equity instruments granted on its

grant date is recognised as a relevant cost or expense

with a corresponding increase in capital reserve. If the

equity instruments granted to employees do not vest

until the completion of services for a vesting period, or

until the achievement of a specified performance condi-

tion, the Bank, at each balance sheet date during the

vesting period, makes the best estimation according to

the latest information of the number of employees who

are granted to vest and revises the number of equity

instruments expected to vest. Based on its best estima-

tion, the Bank recognises the services received for the

current period as related costs or expenses, with a

corresponding increase in capital reserve, at an amount

equal to the fair value of the equity instruments at the

grant date.

When the Bank receives services but has no obligation

to settle the transaction, and the related equity instru-

ments are issued by the Bank’s ultimate parent, the

Bank recognises the transaction as an equity-settled

share-based payment transaction.

the differences between the carrying amounts of assets

and liabilities for financial reporting purposes and their

tax bases, which include the deductible losses and tax

credits carried forward to subsequent periods.

Deferred tax assets are recognised to the extent that it

is probable that future taxable profits will be available

against which deductible temporary differences can be

utilised.

Deferred tax is not recognised for temporary differenc-

es arising from the initial recognition of assets or liabili-

ties in a transaction that is not a business combination

and that affects neither accounting profit nor taxable

profit (or tax loss).

At the balance sheet date, the amount of deferred tax

recognised is measured based on the expected manner

of recovery or settlement of the carrying amount of the

assets and liabilities, using tax rates that are expected

to be applied in the period when the asset is recovered

or the liability is settled in accordance with tax laws.

The carrying amount of a deferred tax asset is reviewed

at each balance sheet date. The carrying amount of a

deferred tax asset is reduced to the extent that it is no

longer probable that sufficient taxable profits will be

available to allow the benefit of the deferred tax asset

to be utilised. Such reduction is reversed to the extent

that it becomes probable that sufficient taxable profits

will be available.

At the balance sheet date, deferred tax assets and liabil-

ities are offset if all the following conditions are met:

the taxable entity has a legally enforceable right to

offset current tax liabilities and assets, and

they relate to income taxes levied by the same tax

authority on either:

48 49

A provision is recognised for an obligation related to a

contingency if the Bank has a present obligation that

can be estimated reliably, and it is probable that an

outflow of economic benefits will be required to settle

the obligation. Where the effect of the time value of

money is material, provisions are determined by

discounting the expected future cash flows.

In terms of a possible obligation resulting from a past

transaction or event, whose existence will only be

confirmed by the occurrence or non-occurrence of

uncertain future events or a present obligation resulting

from a past transaction or event, where it is not proba-

ble that the settlement of the above obligation will

cause an outflow of economic benefits, or the amount of

the outflow can not be estimated reliably, the possible

or present obligation is disclosed as a contingent liabili-

ty.

Government grants are transfers of monetary assets or

non-monetary assets from the government to the Bank

at no consideration except for any capital contribution

from the government as a shareholder of the Bank.

Special funds such as investment grants allocated by

the government, if clearly defined in official documents

as part of “capital reserve” are dealt with as capital

contributions, and not regarded as government grants.

A government grant is recognised when there is reason-

able assurance that the grant will be received and that

the Bank will comply with the conditions associated with

the grant.

If a government grant is in the form of a transfer of a

monetary asset, it is measured at the amount that is

received or receivable. If a government grant is in the

form of a transfer of a non-monetary asset, it is meas-

ured at its fair value.

A government grant related to an asset is recognised

initially as deferred income and amortised to profit or

loss on a straight-line basis over the useful life of the

asset. A grant that compensates the Bank for expenses

to be incurred in the subsequent periods is recognised

initially as deferred income and recognised in profit or

loss in the same periods in which the expenses are

recognised. A grant that compensates the Bank for

expenses incurred is recognised in profit or loss immedi-

ately.

Revenue is the gross inflow of economic benefits in the

periods arising in the course of the Bank’s ordinary

activities when the inflows result in increase in share-

holders’ equity, other than increases relating to contri-

butions from shareholders. Revenue is recognised in

profit or loss when it is probable that the economic

benefits will flow to the Bank, the revenue and costs can

be measured reliably and the following respective condi-

tions are met: Fee and commission income is recognised in the income

statement when the corresponding service is provided.

Origination or commitment fees received by the Bank

which result in the creation or acquisition of a financial

asset are deferred and recognised as an adjustment to Interest income arising from the use by others of entity

assets is recognised in the income statement based on

The Bank acts in a fiduciary capacity as a custodian,

trustee or an agent for its customers. Assets held by the

Bank and the related undertakings to return such assets

to customers are excluded from the financial state-

ments as the risks and rewards of the assets reside with

the customers.

(11) Provisions and contingent liabilities

(12) Fiduciary activities

(13) Revenue recognition

(14) Government grants


(a) Interest income

(b) Fee and commission income

the same taxable entity; or

different taxable entities which either to intend to

settle the current tax liabilities and assets on a net

basis, or to realise the assets and settle the liabilities

simultaneously, in each future period in which signifi-

cant amounts of deferred tax liabilities or assets are

expected to be settled or recovered.

Entrusted lending is the business where the Bank enters

into entrusted loan agreements with customers, where-

by the customers provide funding (entrusted funds) to

the Bank, and the Bank grants loans to third parties

(entrusted loans) at the instruction of the customers. As

the Bank does not assume the risks and rewards of the

entrusted loans and the corresponding entrusted funds,

entrusted loans and funds are recorded as off-balance

sheet items at their principal amounts and no impair-

ment assessments are made for these entrusted loans.

Wealth management business refers to agreements

between the Bank and its customers to raise funds from

them for investment in the assets of the Bank or third

parties. In this business, the Bank performs its manage-

ment duties and collects corresponding fees in accord-

ance with the relevant agreements. As the Bank does

not assume the risks and rewards of the funds and

investments of the wealth management business, the

corrensponding funds and investments are recorded as

off-balance sheet items.

the duration and the effective interest rate. Interest

income includes the amortisation of any discount or

premium or differences between the initial carrying

amount of an interest-bearing instrument and its

amount at maturity calculated on an effective interest

rate basis.

The effective interest method is a method of calculating

the amortised cost of financial assets and liabilities and

of allocating the interest income and interest expense

over the relevant period. The effective interest rate is

the rate that exactly discounts estimated future cash

payments or receipts through the expected life of the

financial instrument, or, when appropriate, a shorter

period, to the net carrying amount of the financial

instrument. When calculating the effective interest rate,

the Bank estimates cash flows considering all the

contractual terms of the financial instrument (for exam-

ple, prepayment, call and similar options) but does not

consider future credit losses. The calculation includes all

fees and points paid or received between parties to the

contract that are an integral part of the effective inter-

est rate, transaction costs and all other premiums or

discounts.

Interest on the impaired financial assets is calculated

and recognised using the rate of interest used to

discount future cash flows for the purpose of measuring

the related impairment loss.

the effective interest rate. If the commitment expires

without the Bank making a loan, the fee is recognised as

revenue on expiry.

50 51

Distributions of profit proposed in the profit appropria-

tion plan to be authorised by the Board of Directors and

declared after the balance sheet date are not recog-

nised as a liability at the balance sheet date but

disclosed in the notes separately.

The preparation of financial statements requires man-

agement to make estimates and assumptions that affect

the application of accounting policies and the reported

amounts of assets, liabilities, income and expenses.

Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on

an ongoing basis. Revisions to accounting estimates are

recognised in the period in which the estimate is revised

and in any future periods affected. Note 9(b) and Note

9(d) contain information about the assumpations and

their risk factors relating to share-based payments and

termination benefits. Other key sources of estimation

uncertainty are as follows:

Determining income tax provisions involves judgement

on the future tax treatment of certain transactions. The

Bank carefully evaluates the tax implications of transac-

tions and sets up tax provisions accordingly. The tax

treatment of such transactions is reconsidered periodi-

The fair values for financial instruments that lack an

active market to provide quoted prices are established

using valuation techniques. These techniques include

using recent arm’s-length market transactions between

knowledgeable, willing parties; reference to the current

fair value of another instrument that is substantially the

same; discounted cash flow analysis; and option pricing

models. The Bank has established a process to ensure

that valuation techniques are constructed by qualified

personnel and are validated and reviewed by independ-

ent personnel. Valuation techniques are certified before

implementation and are calibrated to ensure that

outputs reflect actual market conditions. Valuation

models established by the Bank make the maximum use

of market inputs and rely as little as possible on

Bank-specific information. However, it should be noted

that some inputs, such as credit and counterparty risk,

and risk correlations, require management estimates.

Management estimates and assumptions are reviewed

periodically and are adjusted if necessary.

The Bank reviews the portfolios of loans and advances

periodically to assess whether impairment losses exist

and if they exist, an impairment loss is recognised.

Objective evidence for impairment includes observable

data indicating that there is a measurable decrease in

the estimated future cash flows identified with an

individual loan. It also includes observable data indicat-

ing adverse changes in the repayment status of borrow-

ers or issuers in the assets portfolio or national or local

economic conditions that correlate with defaults on the

assets in the portfolio. The impairment loss for a loan

that is individually assessed for impairment is the

decrease in the estimated discounted future cash flow

of that asset. When loans and advances are collectively

assessed for impairment, the estimate is based on

Reportable segments are identified based on operating

segments which are determined based on the structure

of the Bank’s internal organisation, management

requirements and internal reporting system. An operat-

ing segment is a component of the Bank that engages in

business activities from which it may earn revenues and

incur expenses, whose financial performance are regu-

larly reviewed by the Bank’s management to make

decisions about recources to be allocated to the

segment and assess its performance, and for which

financial information regarding financial position, finan-

cial performance and cash flows is available.

Two or more operating segments may be aggregated

into a single operating segment if the segments have

same or similar economic characteristics and are similar

in respect of:

the nature of each products and services

the nature of production processes

the type or class of customers for the products and

services

the methods used to distribute the products or

provide the services

the nature of the regulatory environment.

Inter-segment revenues are measured on the basis of

If a party has the power to control, jointly control or

exercise significant influence over another party, or vice

versa, or where two or more parties are subject to

common control or joint control from another party,

they are considered to be related parties. Related

parties may be individuals or enterprises. Enterprises

with which the Bank is under common control only from

the State and that have no other related-party relation-

ships are not regarded as related parties of the Bank.

Related parties of the Bank include, but are not limited

to:

(a) the Bank’s parent

(b) the Bank’s subsidiaries

(c) enterprises that are controlled by the Bank’s parent

(d) investors that have joint control or exercise signifi-

cant influence over the Bank

(e) enterprises or individuals if a party has control or

joint control over both the enterprises or individuals and

the Bank

(f) joint ventures of the Bank, including subsidiaries of

joint ventures

(g) associates of the Bank, including subsidiaries of

associates

(h) principal individual investors and close family mem-

bers of such individuals

(i) key management personnel of the Bank and close

family members of such individuals

(15) Profit distributions to owners

(16) Related parties

(18) Significant accounting estimates and judgments

(17) Segment reporting


(a) Impairment losses of loans and advances

(b) Fair value of financial instruments

(c) Income tax

(j) key management personnel of the Bank’s parent and

close family members of such individuals

(k) other enterprises that are controlled or jointly

controlled by principal individual investors or key man-

agement personnel of the Bank, or close family mem-

bers of such individuals, and

(l) annuity plan of the Bank for the benefit of employ-

ees.

actual transaction price for such transactions for

segment reporting, and segment accounting policies are

consistent with those for the Bank’s financial statement.

historical loss experience for assets with credit risk

characteristics similar to the loans and advances.

Historical loss experience is adjusted on the basis of the

relevant observable data that reflect current economic

conditions. Management reviews the methodology and

assumptions used in estimating future cash flows

periodically to reduce any difference between estimated

and actual losses.

5352

(1) The Bank places statutory deposit reserves with the

PBOC in accordance with the Regulation of the PRC on

the Administration of Foreign-funded Banks (Adminis-

trative Regulation) and relevant regulations. The statu-

tory deposit reserves are not available for use in the

Bank’s daily business. As at the balance sheet date, the

statutory deposit reserve rates applicable to the Bank

were as follows:

(2) The surplus deposit reserves are maintained with

the PBOC mainly for settlement purposes.

The major types of taxes applicable to the Bank and the

tax rates are as follows:

Business tax is charged at 5% on taxable income (2012:

5%).

The statutory income tax rate applicable to the Bank is

25%. The applicable income tax rate for the year is the

statutory rate (2012: 25%).

As described in Note 3(8)(b), fixed assets and intangible

assets are reviewed at each balance sheet date to deter-

mine whether the carrying amount exceeds the recover-

able amount of the assets. If any such indication exists,

related assets are regarded as impaired and impairment

losses recognised accordingly.

The recoverable amount of an asset (asset group) is the

greater of its fair value less costs to sell and its present

value of the expected future cash flows. Since a market

price for the asset (or the asset group) cannot be

obtained reliably, the fair value of the asset cannot be

estimated reliably. In assessing value in use, significant

judgements are exercised over the asset’s production,

selling price, related operating expenses and discount

rate to calculate the present value. All relevant materi-

als which can be obtained are used to estimate the

recoverable amount, including an estimation of the

production, selling price and related operating expenses

based on reasonable and supportable assumptions.

As described in Note 3(5) and 3(7), fixed assets and

intangible assets are depreciated and amortised over

their useful lives after taking into account residual

value. The useful lives of the assets are regularly

reviewed to determine the depreciation and amortisa-

tion costs charged in each reporting period. The useful

lives of the assets are determined based on historical

experiences of similar assets and estimated technical

changes. If there have been significant changes in the

factors used to determine the depreciation or amortisa-

tion, the rate of depreciation or amortisation is revised

prospectively.


05 Cash on hand and deposits with central bank04 Taxation

2013 2012

2013 2012

(d) Impairment of fixed assets and intangible assets

(e) Depreciation and amortization of assets

such as fixed assets, intangible assets

(1) Business tax

(2) Income tax

(3) Taxes payable

cally to take into account all changes in tax legislation.

Deferred tax assets are recognised for tax losses not yet

used and deductible temporary differences. As deferred

tax assets can only be recognised to the extent that it is

probable that future taxable profits will be available

against which the deductible temporary differences can

be utilised, management’s judgement is required to

assess the probability of future taxable profits. Manage-

ment’s assessment is constantly reviewed and addition-

al deferred tax assets are recognised if it becomes prob-

able that future taxable profits will allow the deferred

tax assets to be utilized.

Income tax 112,346,356 85,827,782

Business taxes and surcharges 59,239,334 53,675,185

Withholding taxes 42,428,853 41,007,134

To tal 214,014,543 180,510,101

Note 2013 2012

Cash on hand 217,035,028 275,527,540

Statutory deposit reserves

with

central bank (1 ) 15,542,835,103 15,638,323,487

Surplus deposit reserves

with

central bank (2) 11,125,924,116 14,723,671,393

Total 26,885,794,247 30,637,522,420

Renminbi deposits 18 % 18 %

Foreign currency deposits 5% 5%

5554

As at 31 December 2013, management considered that

no impairment provision of deposits with inter-banks

was necessary (2012: nil).

The bonds investments held for trading are issued by

the following institutions and stated at fair value

The notional amounts of the derivatives indicate the volume of transactions outstanding at the balance sheet date;

they do not represent the amounts at risk.

06 Deposits with inter-banks 08 Trading financial assets 09 Derivatives financial instruments

07 Placements with inter-banks

2013 2012 2013 2012

2013 2012

2013 2012

Deposits with inter-banks

- in Mainland China 1,140,335,808 1,728,623,830

- outside Mainland China 6,442,308,143 11,006,328,825

Subtotal 7,582,643,951 12,734,952,655

Deposits with non-bank financial institutions

- in Mainland China 68,171,965 51,115,871

- outside Mainland China - 16,619

Subtotal 68,171,965 51,132,490

Total 7,650,815,916 12,786,085,145

Placements with inter-banks



Subtotal 23,522,020,787 19,049,688,269

Placements with non-bank financial institutions


Total 30,707,510,787 23,311,688,269

Bond investments held for trading 3,266,961,398 3,512,945,036

Policy banks 2,494,194,090 1,098,233,820

The MOF 459,936,228 40,977,976

Inter-banks and non-bank institutions

outside mainland China 252,920,110 290,533,340

Enterprises in mainland China 59,910,970 79,821,200

The PBOC - 2,003,378,700

Total 3,266,961,398 3,512,945,036

Interest rate derivatives：

Interest rate swap 135,049,948,534 956,074,626 931,897,543

Interest rate option 4,015,236,292 148,593 1,450,812

139,065,184,826 956,223,219 933,348,355

Currency derivatives：

Currency option 4,832,778,514 15,828,793 7,933,033

Forward 247,342,477,351 1,834,152,533 1,881,079,714

252,175,255,865 1,849,981,326 1,889,012,747

Other derivatives：

Commodity swap 1,307,427,374 17,553,683 17,553,683

Equity swap 743,907,668 4,896,365 4,896,365

2,051,335,042 22,450,048 22,450,048

Total 393,291,775,733 2,828,654,593 2,844,811,150

139,697,972,546 456,618,654 421,765,687

2,527,647,336 506,401 214,982

142,225,619,882 457,125,055 421,980,669

11,558,446,498 26,068,871 24,426,965

201,399,941,349 1,194,899,631 972,184,204

212, 958,387,847 1,220,968,502 996,611,169

907,133,166 9,608,513 9,608,513

235,458,754 2,353,696 2,353,696

1,142,591,920 11,962,209 11,962,209

356,326,599,649 1,690,055,766 1,430,554,047

2013 2012

Notionalamounts Fair Value

AssetsTotal Liabilities

Notionalamounts Fair Value

AssetsTotal Liabilities

56 57

10 Loans and advances to customers

Amount Amount

Note 2013 2012

(1) Analysed by nature

(2) Analysed by industry sector

Corporate loans and advances

- loans 36,474,959,601 32,078,445,864

- discounted bills 7,233,387,443 19,254,643,950

Personal loans and advances

- residential mortgages 15,435,894,174 10,543,940,346

- personal consumer loans 1,330,960,452 1,074,259,688

- credit cards loans 1,580,481,382 500,395,636

Note

2013 2012

Gross loans and advances 62,055,683,052 63,451,685,484

Less: Allowances for impairment losses 10(6) (667,754,656) (501,175,803)

Net loans and advances to customers 61,387,928,396 62,950,509,681

Manufacturing 17,492,488,183 28% 18,218,312,858 29%

Wholesale and retail trade 7,956,768,198 13% 6,248,740,458 10%

Leasing and commercial services 3,959,409,971 6% 3,512,607,045 5%

Transportation, storage and postal

services

3,065,219,941 5% 1,364,332,257 2%

Telecommunications, IT services

and software

1,479,145,952 2% 320,930,018 1%

Mining 995,234,050 2% 952,825,000 2%

Hotel and restaurant 795,078,689 1% 701,306,506 1%

Real estate 135,875,278 *0% 137,254,723 *0%

Fisheries and agriculture 96,704,645 *0% 94,289,114 *0%

Construction 15,871,566 *0% 404,712,940 1%

Production and supply of electricity,

gas and water - - 16,631,433 *0%

Others 483,163,128 1% 106,503,512 *0%

Subtotal 36,474,959,601 58% 32,078,445,864 51%

Discounted bills 7,233,387,443 12% 19,254,643,950 30%

Personal loans and advances 18,347,336,008 30% 12,118,595,670 19%

Gross loans and advances 62,055,683,052 100% 63,451,685,484 100%

Less: Allowances for impairment

losses

10(6) (667,754,656) (501,175,803)

Net loans and advances to customer s61,387,928,396 62,950,509,681

* The percentages of th ese items are less than 1%.

58 59

Overdue loans represent loans and advances to customers, of which the whole or part of the principal or interest was

overdue for more than one day.


(3) Analysed by geographical sector (5) Overdue loans analysed by overdue period

(4) Analysed by security type

Amount AmountNote

2013 2012 2013

Note 2013 2012

Yangtze River Delta 34,508,693,193 56% 34,827,058,106 55%

Bohai Rim 13,876,184,228 22% 12,355,518,733 19%

Pearl River Delta 11,164,614,499 18% 13,655,069,590 21%

Middle and western region 2,071,002,611 3% 2,271,763,844 4%

Northeastern region 435,188,521 1% 342,275,211 1%

Gross loans and advances 62,055,683,052 100% 63,451,685,484 100%

Less: Allowances for

impairment losses 10(6) (667,754,656) (501,175,803)

Net loans and advances to

customers

61,387,928,396 62,950,509,681

Unsecured loans 22,929,128,346 30,802,918,123

Guaranteed loans 13,418,533,793 14,207,343,972

Secured loans 25,708,020,913 18,441,423,389

- by tangible assets other than monetary assets 16,950,022,186 11,966,617,126

- by monetary assets 8,757,998,727 6,474,806,263

Gross loans and advances 62,055,683,052 63,451,685,484

Less: Allowances for

impairment losses 10(6) (667,754,656) (501,175,803)

Net loans and advances to customers

61,387,928,396 62,950,509,681

Unsecured loans 210,085,416 33,707,258 4,066,540 661,218 248,520,432

Guaranteed loans 3,925,000 41,997,095 38,009,531 24,716,259 108,647,885

Secured loans 92,689,699 1,910,344 67,221,614 106,285,878 268,107,535

- by tangible asssets other

than monetary assets 90,888,153 1,910,344 67,221,614 106,285,878 266,305,989

-by monetary assets 1,801,546 - - - 1,801,546

Total 306,700,115 77,614,697 109,297,685 131,663,355 625,275,852

Within three months

(inclusive)Over

three years Total

Between three months and one year

(inclusive)

Between one year and three months

(inclusive)

2012

Within three months

(inclusive)Over

three years Total

Between three months and one year

(inclusive)

Between one year and three months

(inclusive)

Unsecured loans 25,866,444 2,422,809 1,756,529 320,995 30,366,777

Guaranteed loans 10,141,582 25,814,411 1,644,856 28,780,910 66,381,759

Secured loans 39,941,609 46,291,731 34,181,193 117,000,000 237,414,533

- by tangible asssets other

than monetary assets 39,941,609 46,291,731 34,181,193 117,000,000 237,414,533

Total 75,949,635 74,528,951 37,582,578 146,101,905 334,163,069

60 61

As at 31 December 2013, the Bank’s loan provision ratio was 1.08% (2012: 0.79%), the provision coverage ratio was

230.86% (2012: 184.69%).

Loan provision ratio represents ratio of loan loss provision over gross loans and advances to customers at the balance

sheet date. Provision coverage ratio represents ratio of loan loss provision over non-performing loans. According to

the five-tier risk classification in CBRC’s Notice on Distributing Guidelines on Loan Risk classification (Yin Jian Fa

[2007] No. 54), non-performing loans represent loans and advances classified as substandard, doubtful and loss.

The available-for-sale bond investments are issued by the following institutions and stated at fair value:

As at 31 December 2013, management considered that no impairment provision of available-for-sale financial assets

was necessary (2012: nil).

2013 2012

2013 2012

2013 2012

(6) Movements of allowances for impairment losses

(7) Restructured loans and advances to customers

Individualassessment Total

Collectiveassessment

2013

Individualassessment Total

Collectiveassessment

2012


11 Available-for-sale financial assets

As at 1 January 258,165,446 243,010,357 501,175,803

Charge for the year 147,710,273 20,659,357 168,369,630

Effect of discounting - (16,476) (16,476)

Exchange differences (1,606,448) (167,853) (1,774,301)

As at 31 December 404,269,271 263,485,385 667,754,656

As at 1 January 339,595,219 173,284,147 512,879,366

(Reversal) / charge for

the year

(82,118,707) 75,661,605 (6,457,102)

Amounts written-off - (5,392,347) (5,392,347)

Effect of discounting - (215,143) (215,143)

Exchange differences 688,934 (327,905) 361,029

As at 31 December 258,165,446 243,010,357 501,175,803

Restructured loans and advances

to customers

117,076,000 131,854,773

Bond investments 17,228,779,130 16,135,172,130

The MOF

9,059,992,400 727,219,430

The PBOC

8,168,786,730 15,407,952,700

Total

17,228,779,130 16,135,172,130

6362

As at 31 December 2013, management considered that no impairment provision of fixed assets was necessary

(2012: nil).

As at 31 December 2013, management considered that no impairment provision of intangible assets was necessary

(2012: nil).

Office & otherequipment Motor vehicles Total

Software

12 Fixed Assets 13 Intangible assets

Cost

As at 1 January 2013 360,188,484 3,995,159 364,183,643

Additions 17,954,927 1,354,324 19,309,251

Disposals (14,302,749) (851,328) (15,154,077)

As at 31 December 2013 363,840,662 4,498,155 368,338,817

Less: Accumulated depreciation

As at 1 January 2013 (286,454,868) (3,593,211) (290,048,079)

Charge for the year (30,629,732) (424,490) (31,054,222)

Written back on disposal 14,295,441 851,328 15,146,769

As at 31 December 2013 (302,789,159) (3,166,373) (305,955,532) Carrying amount

As at 31 December 2013 61,051,503 1,331,782 62,383,285

As at 31 December 2012 73,733,616 401,948 74,135,564

Cost

As at 1 January 2013 168,767,408

Additions 7,817,033

Disposals (1,885,015)

As at 31 December 2013 174,699,426

--------------------- Less: Accumulated amortisation

As at 1 January 2013 (88,206,405)

Charge for the year (17,499,721)

Written back on disposal 362,054

As at 31 December 2013 (105,344,072)

---------------------

Carrying amounts

As at 31 December 2013 69,355,354

As at 31 December 2012 80,561,003

64 65

(1) Movements of allowances for other assets

At the balance sheet dates, the deferred tax assets and liabilities on the balance sheet, after offsetting each other,

were as follows:

Deferred tax assets / (liabilities)

As at 1January 2013

Current yearincrease / decrease

charged toprofit or loss

Current yearincrease / decrease

recognisedin equity

As at 31December 2013

14 Deferred tax assets 15 Other assets

17 Borrowings from inter-banks

16 Deposits from inter-banks and non-bank financial institutions

Fair value adjustments for derivatives (64,875,431) 68,916,476 - 4,041,045

Fair value adjustments for

available-for-sale financial assets (2,927,082) - 40,757,307 37,830,225

Fair value adjustments for trading

financial assets 16,342 845,103 - 861,445

Adjustments for accrued expenses 148,700,217 6,459,009 - 155,159,226

Others 14,371,076 1,155,496 110,656 15,637,228

Total 95,285,122 77,376,084 40,867,963 213,529,169

2013 2012

Deferred tax assets 213,529,169 163,087,638

Deferred tax liabilities - (67,802,516)

Total 213,529,169 95,285,122

Note 2013 2012 2013 2012

2013 2012

2013 2012

Suspensed settlement 1,500,940,390 231,756,983

Deferred expenses 210,603,390 146,490,760

Leasehold improvements 146,149,304 158,282,164

Refundable deposits 94,497,451 91,804,819

Receivables 189,103 2,555,633

Others - 213,354

Subtotal 1,952,379,638 631,103,713

Less : Provisions for

impairment losses

(1) (27,341,850) (28,187,636)

Total 1,925, 037,788 602,916,077

As at 1 January 28,187,636 28,256,698

Exchange differences (845,786) (69,062)

As at 31 December 27,341,850 28,187,636

Deposits from inter-banks

- in Mainland China 113,948,602 160,902,318


Subtotal 12,411,416,696 6,269,931,601

Deposits from non bank financial institutions

-

- in Mainland China 894,667,156 3,165,698,244


Subtotal 8,189,722,198 6,038,651,069

Total 20,601,138,894 12,308,582,670

Borrowings from inter-banks


66 67

As at 31 December 2012, the counterparties of the above financial assets sold under repurchase agreements were

the PBOC and domestic banks in Mainland China.

(1) Pursuant to the relevant laws and regulations of the PRC, employees of the Bank participate in the social insurance

system established and managed by government organisations. The Bank makes social insurance contributions to the

local social insurance entities at the applicable base salary and rates stipulated by the government for the benefit of

its employees.

Besides, the Bank provides an annuity plan to the eligible employees. The Bank makes annuity contributions in propor-

tion to its employees’ gross salaries.

18 Financial assets sold under repurchase agreements

19 Deposits from customers

20 Employee benefits payable

2013 2012

2013 2012

The PBOC notes - 7,430,000,000 Government bonds - 490,000,000

Total - 7,920,000,000

Current deposits

- corporate customers 49,236,320,228 56,480,143,472

- personal customers 4,999,357,184 4,295,546,488

Subtotal of current deposits 54,235,677,412 60,775,689,960

Time deposits (including call deposits)

- corporate customers 33,243,212,636 33,648,763,402

- personal customers 8,840,279,854 9,085,025,373

Subtotal of time deposits 42,083,492,490 42,733,788,775

Other Deposits

- inward and outward remittances 304,933,731 56,618,645

Total 96,624,103,633 103,566,097,380

Salaries, bonuses and allowances 207,695,315 1,109,167,665 (1,098,889,693) 217,973,287

Social insurances 15,403,381 158,695,002 (154,407,866) 19,690,517

Medical insurance premium 3,418,432 42,281,096 (40,121,190) 5,578,338

Pension insurance premium 8,054,260 81,856,655 (79,526,677) 10,384,238

Annuity premium (1) 3,041,657 23,369,149 (24,077,499) 2,333,307

Unemployment insurance premium

551,384 5,971,974 (5,832,443) 690,915

Work-related injury insurance premium

124,991 2,018,213 (1,813,898) 329,306

Maternity insurance premium

212,657 3,197,915 (3,036,159) 374,413

Housing fund 4,542,256 33,832,722 (35,562,049) 2,812,929

Others 610,160 78,374,936 (78,340,899) 644,197

Total 228,251,112 1,380,070,325 (1,367,200,507) 241,120,930

Balance at thebegining

of the year

Accruedduring

the year

Paidduring

the year

Balanceat the end

of the yearNote

68 69

21 Other liabilities 23 Capital reserve

24 Surplus reserve

22 Paid-in capital

2013 2012

Cash collaterals 7,374,698,368 5,692,041,839

Suspensed settlement 2,047,180,081 2,942,486,128

Accrued expenses 251 ,593,516 208,305,475

Deferred income 54,941 ,612 25,900,425

Others 162,720,180 284,488,570

Total 9,891,133,757 9,153,222,437

Capital contributions in foreign currency were translated into Renminbi at the exchange rate at the date of the contributions received as quoted by the PBOC.

Certified Public Accountants have verified the above paid-in capital and issued related capital verification reports.

As at 31 December, the Bank’s registered capital and paid-in capital are as follows:

2013 and 2012

Registered capital and paid-in capital Amount %

Citibank 3,970,000,000 100%

2013

Balance at the Changes Transfer Balance at

beginning during Fair value to profit the end of of the year the year adjustments or loss the year

Other capital reserve

- Available-for-sale financial assets 11,708,330 - (169,198,731) 6,169,500 (151,320,901)

- Equity-settled

share-based payments 33,400,541 2,192,097 - - 35,592,638

- Deferred tax

- Available-for-sale financial assets (2,927,082) 40,757,307 - - 37,830,225

- Equity-settled share-based

payments

(8,457,699) 110,656 - - (8,347,043)

Total 33,724,090 43,060,060 (169,198,731) 6,169,500 (86,245,081)

2013

Balance at the beginning of the year 605,631,273

Profit appropriation ( N ote 26(1 )) 96,412,040

Balance at the end of the year 702,043,313

The statutory surplus reserve is as follows:

70 71

25 General reserve

Appropriation to general reserve in accordance with

the regulations issued by the MOF

2013

Balance at the beginning of the year

1,305,394,495

Profit appropriation (Note 26)

171,295,790

Balance at the end of the year

1,476,690,285

According to the Notice on Administrative Measures on Accrual of Provisions by Financial Enterprises (Cai Jin [2012]

No.20) issued by the MOF on 30 March 2012, a financial enterprise shall appropriate from net profits an amount of

not less than 1.5% of its risk-bearing assets at the year end as general reserve. Where the general provision ratio

cannot reach 1.5% immediately, it is acceptable to reach the ratio gradually over a period of not more than five years

in principle. The Notice came into force on 1 July 2012. The Bank appropriates the general reserve in according with

the requirements of Cai Jin [2012] No.20.

As at 31 December 2013, the Bank appropriated an amount of Renminbi 1,476,690,285 as general reserve according

to the above requirements (2012: Renminbi 1,305,394,495).

26 Profit appropriation

Note

2013 2012

Appropriations to surplus reserve (1) 96,412,040 137,321,296

Appropriations to general reserve 25 171,295,790 486,953,322

267,707,830 624,274,618

(1) Appropriations to surplus reserve

The Bank appropriated an amount of Renminbi 96,412,040, representing 10% of profit after tax for the year as surplus

reserve in accordance with relevant regulations and its articles (2012: Renminbi 137,321,296).

2013 201 2

Interest income : Loans and advances to customers 3,048,313,5 79 3,356,128,938

corporate loans and advances 1,507,553,348 1,788,421,507

discounted bills 697,351,582 1,019,309,699

personal loans and advances 843,408,651 548,397,732

Placements with inter -banks 1,034,107,517 702,846,294

Deposits with central bank 283,897,507 292,640,768

Deposits with inter -banks 21, 252,029 46,726,232

Others 5,930,058 10,218,933

Total interest income 4,393,500,690 4,408,561,165

Include : interest income from impaired

financial assets 16,476 215,143

Interest expenses :

Deposits from customers (1,400, 740,133 ) (1,331,619,085)

Deposits from inter -banks and non-bank

financial institutions (241,946,324) (221,540,695)

Borrowings from inter -banks (103,649,690) (46,923,105)

Financial assets sold under repurchase agreements

(44,355,079 ) (118,270,912)

Total interest expenses (1,790,691,226)

(1,718,353,797)

Net interest income 2,602,809,464

2,690,207,368

27 Net interest income

72 73

2013 201 2 2013 201 2

2013 201 2

28 Net fee and commission income 29 Investment income

Fee and commission income:

Commission on trust and custodian activities 359,549,539 268,419,757

Fees for agency services 101,610,718 78,703,867

Credit commitment fees 71,723,520 95,819,314

Settlement and clearance fees 53,340,966 53,086,934

Trade finance and guarantee services fees 52,557,332 53,567,629

Bank card fees 38,878,308 10,296,860

Others 36,218,968 30,861,602

Total fee and commission income 713,879,351 590,755,963

Fee and commission expenses:

Inter-bank transaction fees (47,209,234) (43,934,213)

Brokerage fees (31,280,223) (42,170,015)

Bank card (4,952,417) (156,580)

Trust and custodian fees (661,733) (370,188)

Others (11,856,176) (6,702,334)

Total fee and commission expenses (95,959,783) (93,333,330)

Net fee and commission income 617,919,568 497,422,633

Available -for-sale financial assets 530,627,361 574,826,505

Derivatives 159,900,969 119,554,060

Trading financial assets 46,341,319 214,500,622

Total 736,869,649 908,881,187

30 (Losses) / gains from changes in fair value

Derivatives (263,170,308) 34,464,171

Trading financial assets (3,380,412) 13,411

Total (266,550,720) 34,477,582

74 75

2013 201 2

2013 201 2

2013 201 2

2013 201 2

33 Income tax expense 31 General and administrative expenses

32 Impairment losses charge / (reversal)

Staff costs - Salaries, bonuses and allowances , etc. 1,063, 816 ,546 1,027,220,288 - Staff welfare 270,902,661 230,384,915

1,334,719,207 1,257,605,203

Service fees 372,765,434 396,783,683 Rental and property maintenance fees 297,574,342 277,734,483

Business promotion expenses 147,005,837 147,190,441

IT equipment maintenance fees 121,776,443 59,277,436

Depreciation and amortisation 82,661,395 83,867,266

Meetings and office expenses 50,765,471 49,029,469

Travelling expenses 23,929,158 30,617,447

Union fees 20,606,494 18,152,699

Utilities 15,930,783 14,497,912

Business entertainment expenses 9,771,537 10,285,845

Stamp duties 7,339,166 6,418,899

Others 230,489,812 196,267,078

Total 2,715,335,079 2,547,727,861

Impairment losses charge / (reversal) for loans and advances to customers 168,369,630 (6,457,102)

(a) Income tax expense for the year represents

Current tax expense for the year 343,296,758 487,743,642 Tax filling differences 883,836 (4,699,211)

Changes in deferred tax assets / liabilities (77,376,084) (28,276,813)

Total 266,804,510 454,767,618

(b) Reconciliation between income tax expense and accounting profit is as follows:

Profit before taxation 1,230,924,906 1,827,980,584

Expected income tax expense at a tax

rate of 25%

307,731,227 456,995,146

Tax effect of non -deductible expenses 5,261,669 13,266,252 Tax effect of non -taxable income (47,072,222) (10,794,569)Tax filling differences 883,836

(4,699,211)

Income tax expense 266,804,510 454,767,618

76 77

2013 201 2

2013 201 2

34 Other comprehensive income35 Supplement to cash flow statement

(Losses) / gains arising from available -for-sale financial assets (169,198,731) 26,749,300 Add / (less): Tax expense 40,757,307 (6,946,788) Reclassification adjustments for amounts transferred to profit or loss

6,169,500

1,037,850

Subtotal (122,271,924) 20,840,362

Changes in fair value of equity -settled share-based payments 2,192,09 7 3,387,924

Add / ( less): T ax expense 110,656 (861,609)

Subtotal 2,302,753 2,526,315

Total (119,969,171) 23,366,677

(1) Reconciliation of net profit to cash flows from operating activities:

Net profit 964,120,396 1,373,212,966Add : Impairment losses charge / (reversal) for loans and advances to customers 168,369,630 (6,457,102) Depreciation of fixed assets 31,054,222 35,151,845 Amortisation of intangible assets 17,499,721 17,492,435 Amortisation of leasehold improvements

34,107,452 31,222,986

Losses on disposal of fixed

assets, intangible assets

and other long -term assets 8,243,040 3,172,191

Investment income (549,336,732) (571,723,577)

Losses / ( gains) on changes in

fair value

266,550,720 (34,477,582)

Increase in deferred tax assets (77,376,084) (28,276,813)

Interest income from impaired

financial assets

(16,476) (215,143)

Unrealised foreign exchange losses 516,254,958 12,524,209

Increase in operating receivables (4,499,201,633) (3,976,724,878)

(D ecrease) / increase in operating

payables 24,190,528,640

(1,841,636,356)

Net cash (outflow ) / inflow from

operating activities (4,961,367,142) 21,045,430,177

78 79

2013 201 2

2013 201 2

2013 201 2

2013 201 2

35 Supplement to cash flow statement

36 Related party relationships and transactions

(2) Change in cash and cash equivalents:

Cash and cash equivalents at the end of the year 35,289,366,558 40,544,135,948

Less : C ash and cash equivalents at the beginning of the year (40,544,135,948) (23,815,812,389)

Net (decrease) / inc rease in cash and cash equivalents (5,254,769,390) 16,728,323,559

(3) Cash and cash equivalents held by the Bank are as follows:

Cash on hand 217,035,028 275,527,540

Central bank deposits available on demand 11,125,924,116 14,723,671,393 Deposits with inter -banks 7,650,815,916 12,786,085,145 Placements with inter -banks 14,078,000,008 12,758,851,870 Trading financial assets 1,218,800,490 - Available -for-sale financial assets 998,791,000 -

Total 35,289,366,558 40,544,135,948

(1) Information on the parent of the Bank is listed as follows:

The Bank’s ultimate controlling party is Citigroup Inc..

Proportion of voting rights

Registered place

United States

Shareholding percentage

100% 100%

Company name Citibank

Principal activities

Banking and financial services

Stockholder’s equity

US dollar 147,557 million

(a) Transactions with the parent:

(b) The balances of transactions with the parent at 31 December are set out as follows:

Interest income 37,757,204 48,669,226

Interest expenses (241,363,097) (178,375,210)

Fee and commission income 16,027,519 13,392,800

Fee and commission expenses (1,067) -

Investment losses (28,910,779) (43,338,668)

(Losses ) / gains from changes

in fair value (117,418,227) 298,375,694

Other operating income 20,549,173 153,643,483

General and administrative expenses (174,706,757) (172,294,922)

Deposits with inter -banks 6,569,526,780 11,005,798,382 Placements with inter-banks 3,663,076,625 6,985,852,448 Derivative financial assets 279,495,024 318,270,529 Interest receivable 1,747,181 1,234,063 Other assets 18,942,208 11,670,486 Deposits from inter -banks and

non-bank financial institutions (12,205,915,844) (4,930,645,103) Borrowings from inter -banks (8,054,585,181) (5,793,590,239) Derivative financial liabilities (340,381,722) (266,257,406) Interest payable (52,105,399) (28,386,037) Other liabilities (181,847,596) (150,611,940)

80 81


2013 201 2

(c) The notional amounts of derivative contracts with the parent at 31 December are set out as follows:

(a) Transactions with the key management personnel and their close family members:

(b) The balances of transactions with the Bank’s key management personnel and their close family members at 31 December are set out

as follows:

(c) The balance of credit commitments with the Bank’s key management personnel and their close family members

at 31 December are set out as follows:

2013 2012

(d) The balances of commitments with the parent at 31 December are set out as follows:

Forwards 20,506,936,203 15,441,768,950

Interest rate swaps 3,352,575,453 10,031,131,761

Currency options 237,809,030 1,164,168,936

Interest rate options 4,015,236,292 2,527,647,336

Commodity swaps 622,828,508 453,566,583

Equity swaps 371,953,833 117,729,377

Operating lease commitments 11,000,612 16,575,165

(e) In addition, significant related party transactions with the Bank’s parent approved by Related Party Transaction

Control Committee and the Board of Directors during the year are set out as follows:

The Bank outsourced the non-Renminbi cash operation, funds and securities operation and technology related service

to Citibank N.A. Singapore Branch. Such outsourcing services cost the Bank Renminbi 162,536,098 in general and

administrative expenses in the year 2013 (2012: Renminbi 154,457,440).

A significant related party transaction represents a single transaction conducted between the Bank and a related party

where the transaction amount is 1% or more of the total equity of the Bank, or after this transaction, the total balance

with the connected party is 5% or more of the total equity of the Bank.

(2) Transactions between the Bank and its key management personnel and their close family members

2013 201 2

2013 201 2

2013 201 2

Remuneration of key management

personnel

90,636,875 85,786,752

Maximum loans and advances issued

to key management personnel

and their close family members 2,614,538 1,740,757

Loans and advances to customers 1, 299,985 1,380,209

Credit cards loans 559,601 226,353 Deposits from customers 15,389,283 11,149,225Employee benefits payable 28,289,560 28,112,995

Related parties of the Bank include close family members of its key management personnel, key management

personnel of the Bank’s parent, close family members of key management personnel of the Bank’s parent, other

enterprises that are controlled or jointly controlled by its key management personnel and close family members of

such individuals. The Bank’s transactions with these related parties are insignificant, thus not disclosed separately.

Credit commitments 5,890,399 5,523,647

82 83

(a) Basic information of the related personnel that have mortgage transactions with the Bank

(b) 65 other related personnels are involved in credit card transactions with the Bank.

(c) The credit balance with the Bank’s other related personnel is set out as follows:

(d) The credit commitments with the Bank’s other related personnel is set out as follows:

(a) Transactions with other related parties:

(3) Credit transactions between the Bank and its other related personnel

(4) Transactions between the Bank and other related parties


Besides the key management personnel information listed in Note 36(2), the Bank discloses the credit transactions

between the Bank and its related personnel according to the requirement of paragraph 38 of Administrative Meas-

ures for the Related Party Transactions between Commercial Banks and their Insiders or Shareholders (Order of the

CBRC (2004) No.3).

The Bank’s related personnel include the Bank’s insiders, controlling shareholders, directors or key management

personnel of the Bank’s related legal entities or other organisations. Insiders include the Bank’s directors, senior

management personnel of the head office and branches and other personnel who have the power to decide or

participate in the extension of credit or transfer of assets by the Bank.

Name Title Jin Yu Executive vice president

Cline Zhang Vice president of Shanghai Branch

Julia Ye Branch manager of Shanghai West Nanjing Road Sub-branch

The credit transaction information relating to the Bank’s executive vice president, Jin Yu, is disclosed in Note 36(2)

and thus not included in Note 36(3).

Loans and advances to customers

Mortgage loans 902,141 637,652

Credit card loans 1,130,561 406,256

2013 201 2

2013 201 2

2013 201 2

Credit commitments 4,335,439 5,793,744

The Bank has credit commitments with 95 other related personnels.

Interest income

10,634,895 8,407,292 Interest expenses

(645,291) (584,178)

Fee and commission income

4,789,606 4,999,198 Fee and commission expenses

(3,307,269) (3,166,454)

Investment losses

(38,096,359) (350,245) Losses from changes in fair value

- (919)

Other operating income

3,004,354 2,456,708 General and administrative expenses

(376, 618,749) (339,710,503)

The transactions and percentage between the Bank and its non-bank related parties are set out as follows:

General and administrative expenses

- Service received 293,412,645 10.81% 259,940,034 10.20% - Property rented 83,206,103 3.06% 79,770,469 3.13%

2013 % 2012 %

84 85

(b) The balances of transactions with other related parties at 31 December are set out as follows: (d) The balances of commitments with other related parties at 31 December are set out as follows:

(c) The notional amounts of derivative contracts with other related parties at 31 December are set out as follows:


2013 201 2

The balance of transactions with non-bank related parties at 31 December are set out as follows:

2013 % 2012 %

Deposits with inter-banks 13,033 -

Placements with inter-banks 249,458,809 117,000,000

Derivative financial assets 1,146,384 2,049,042

Loans and advances to customers 23,658,809 47,317,618

Interest receivable 1,682,338 659,503

Other assets 8,223,809 13,529,366

Deposits from inter-banks and

non-bank financial institutions

(35,826,539) (14,503,483)

Derivative financial liabilities (779,758) (532,688)

Deposits from customers (167,403,681) (108,536,199)

Interest payable (25,162) (16,162)

Other liabilities (34,477,571) (96,824,457)

Placement with non-bank

financial institutions 249,458,809 0.81% 117,000,000 0.50%

Loans and advances

to customers 23,658,809 0.04% 47,317,618 0.07%

Other liabilities

- Service fee payables 34,477,571 0.34% 22,453,856 0.25%

Forwards - 10,155,941

Interest rate swaps 1,641,082,638 1,117,604,985

Currency options 2,063,394,482 3,797,222,632

2013 2012

2013 201 2

Operating lease commitments 60,377,381 119,802,127

(e) In addition, the significant related party transactions with other related parties approved by the Bank’s Related

Party Transaction Control Committee and the Board of Directors are set out as follows:

Outsourcing of China Data Centre processing and management services, software application and enhancement and

technical support to Citicorp Software and Technology Services (China) Ltd.(including Citicorp Data Processing

(Shanghai) Co., Ltd. and Citicorp Management Consulting (Shanghai) Co., Ltd.), was approved in prior years. Such

outsourcing services cost the Bank Renminbi 266,964,917 in general and administrative expenses in the year 2013

(2012: Renminbi 267,872,087).

86 87

Changes in

Relationships Legal Registered Registered registered capital Company name with the Bank Company type Principle activities representative place capital for the year

(e) Relationships between the Bank and other related parties under the transactions stated in 36(4)(a) to (d) above


Citicorp Software and Group subsidiary Limited liabilities

Software development,

Gary Li PRC USD 17,350 thousand No changes Technology Services company (WOFE)

back office operation

(China) Ltd.

and outsourcing service,

consulting and training

Hubei Jingzhou Gong’an Group subsidiary Limited liabilities Credit business Jie Liu PRC RMB 34,000 thousand No changes Citi Lending Co., Ltd. company (WOFE)

Dalian Wafangdian Group subsidiary Limited liabilities Credit business Shilu Liu PRC RMB 34,000 thousand No changes Citi Lending Co., Ltd. company (WOFE)

Hubei Xian’ ning Chibi Group subsidiary Limited liabilities Credit business Sizhen Li PRC RMB 34,000 thousand No changes Citi Lending Co., Ltd. company (WOFE)

Chongqing Beibei Group subsidiary Limited liabilities Credit business Zhengquan Li PRC RMB 38,800 thousand No changes Citi Lending Co., Ltd. company (WOFE)

CitiRealty China (BVI) Ltd. Group subsidiary Private company Property holding * British Virgin Island USD 50 thousand No changes

Citigroup Trade Group subsidiary Private company Outsourcing service * Malaysia MYR 5,000 thousand No changes

Services (Malaysia) Sendirian Berhad

Citicorp International Limited Group subsidiary Private company Banking * Hong Kong USD 24,000 thousand No changes

and HKD 200,000 thousand

Citicorp Service Group subsidiary Public company Decision Support,

* India INR 2,500 million No changes India Limited Vendor Oversight Diners Club International Group subsidiary Private company Charge card business * Hong Kong HKD 2 million No changes (Hong Kong) Ltd.

Citishare Corporation Group subsidiary Private company ATM processing * United States USD 1 thousand No changes

Citibank Singapore Ltd. Group subsidiary Private company Commercial banking * Singarpore SGD 1,527,730 thousand No changes

Citigroup Global Market Group subsidiary Private company Security and invesment * Hong Kong HKD 320,134 No changes Asia Ltd. banking business thousand

Citi Ventures Shanghai Group subsidiary’s Representative office Marketing and Wei Hopeman United States N/A No changes

Representative office representative office of foreign enterprise coordinating efforts

Citibank Taiwan Limited Group subsidiary Public company Commerical banking Guolin Guan Taiwan NT$ 66,033 million No changes

Citibank Nigeria Limited Group subsidiary Limited liabilities Commerical banking * Nigeria Naira 50,100 million Increased by Naira 1,000 million

Citibank Uganda Limited Group subsidiary Private company Commerical banking * Uganda UGX 43,923,900 thousand No changes

Citibank Japan Ltd. Group subsidiary Private company Commerical banking * Japan JPY 123,100 million No changes

Citibank Pty Ltd. Group subsidiary Private company Commerical banking * Australia AUD 459.80 million No changes

Citibank Europe PLC Group subsidiary Public company Commerical banking * Ireland USD 10,071 thousand No changes

* These related parties were registered outside Mainland China where legal representatives are not required .

88 89


(5) Transactions with the annuity plan

Apart from the obligations for defined contributions to the annuity plan, no other transactions were conducted

between the Bank and the annuity plan during the year.

The Bank’s share-based payment scheme is devised to reward staff for their services.

As at 31 December 2013, the outstanding number of shares in connection with share-based payments which the Bank

granted to its staff but not exercised is 323,324 (2012: 415,741). The above shares are the shares of Citigroup Inc.

This segment provides a range of financial products and

services to individual customers, including: personal

deposit taking activities, personal short-term, medi-

um-term and long-term loans, personal domestic and

foreign settlement, foreign exchange trade and agent

services, insurance agent services, bank card services

and safe deposit box services.

For the purposes of assessing segment performance and

allocating resources between segments, the Bank’s

management regularly reviews the assets, liabilities,

revenue, expenses and financial performance, attributa-

ble to each reportable segment on the following bases:

Segment assets include all tangible, intangible, other

non-current and current assets, with the exception of

deferred tax assets and other unallocated corporate

assets. Segment liabilities include deposits from

customers, deposits from inter-banks and non-bank

financial institutions, borrowings from inter-banks and

other liabilities attributable to the individual segments.

Financial performance is operating income (including

operating income from external customers and

inter-segment operating income) after deducting

expenses, depreciation, amortisation and impairment

losses attributable to the individual segments. Inter-seg-

ment sales are determined with reference to prices

charged to external parties for similar orders. Non-oper-

ating income and expenses and tax expenses are not

allocated to individual segments. Information regarding

the Bank’s reportable segments set out below includes

the information used for assessing segment perfor-

mance and allocating segment assets and liabilities by

the Bank’s management or not used but regularly

reviewd by the Bank’s management:

This segment mainly includes assets, liabilities, income

and expenses which cannot be attributed to directly or

divided reasonably to segments.

The Bank has two reportable segments, which are corpo-

rate banking and personal banking segment, determined

based on the structure of its internal organisation, man-

agement requirements and internal reporting system.

Each reportable segment is a separate business unit

which offers different products and services, and is man-

aged separately because they require different technol-

ogy and marketing strategies. The financial information

of the different segments is regularly reviewed by the

Bank’s management to make decisions about resources

to be allocated to each segment and assess its perfor-

mance.

This segment provides a range of financial products and

services to corporations and financial institutions,

including: corporate deposit taking activities, corporate

short-term, medium-term and long-term loans, bank

acceptances and bills discounted, government bonds

and financial bonds transactions, foreign currency secu-

rities transactions other than stocks, letters of credit

and guarantees, corporate domestic and foreign settle-

ments, foreign exchange trade and agent services,

inter-bank placements and borrowings, safe deposit box

services, credit investigation and advisory services.

Expenses recognised for the year arising from share-based payments are as follows:

(1) Segment results, assets and liabilities

37 Share-based payments

38 Segment reporting

2013 201 2

Equity -settled share-based payments 29,703,934 25,573,119

Corporate banking

Personal banking

Unallocated items

90 91

(a) Other income includes investment income, gains or losses from changes in fair value, foreign exchange gains or

losses and other income.

38 Segment reporting

(1) Segment results, assets and liabilities (continued)

Corporate banking Personal banking Unallocated items Total

2013 2012 2013 2012 2013 2012 2013 2012

1. Operating income 3,249,936,744 3,914,175,176 1,102,945,300 714,286,062 - - 4,352,882,044 4,628,461,238 Net interest income 1,939,987,885 2,325,685,876 662,821,579 364,521,492 - - 2,602,809,464 2,690,207,368 Net fee and commission income 201,694,997 189,133,241 416,224,571 308,289,392 - - 617,919,568 497,422,633 Other income (a) 1,108,253,862 1,399,356,059 23,899,150 41,475,178 - - 1,132,153,012 1,440,831,237 2. Operating expenses (1,630,348,676) (1,612,993,634) (1,495,593,702) (1,198,836,708) - - (3,125,942,378) (2,811,830,342) Include: Depreciation and amortisation (37,050,698) (39,791,087) (45,610,697) (44,076,179) - - (82,661,395) (83,867,266) Impairment losses (charge) / reversal (100,516,075) 26,363,477 (67,853,555) (19,906,375) - - (168,369,630) 6,457,102 3. Operating profit / (loss) 1,619,588,068 2,301,181,542 (392,648,402) (484,550,646) - - 1,226,939,666 1,816,630,896 Add: Non-operating income - - - - 6,634,513 15,001,545 6,634,513 15,001,545 Less: Non-operating expenses - - - - (2,649,273) (3,651,857) (2,649,273) (3,651,857) 4. Profit / (loss) before tax 1,619,588,068 2,301,181,542 (392,648,402) (484,550,646) 3,985,240 11,349,688 1,230,924,906 1,827,980,584

5. Total assets 133,516,400,273 139,393,849,482 19,017,667,078 12,844,918,576 213,529,169 95,285,122 152,747,596,520 152,334,053,180

6. Total liabilities 119,777,171,197 126,825,113,235 21,582,767,189 14,965,433,036 - - 141,359,938,386 141,790,546,271

92 93

38 Segment reporting 39 Fiduciary activities 40 Pledged assets

41 Risk management

(2) Geographic information

The following table sets out information about the

geographical location of the Bank’s operating income

from external customers and the Bank’s non-current

assets (excluding financial instruments, deferred tax

assets, same as below). The geographical information is

based on the location of customers receiving services.

The geographical location of the specified non-current

assets is based on the physical location of the asset, in

the case of fixed assets; and the location of the opera-

tion to which they are allocated, in the case of intangible

assets.

At the balance sheet dates, the entrusted loans and

funds were as follows:

Secured liabilities are recorded as financial assets sold

under repurchase agreements. These transactions are

conducted under usual and customary terms of borrow-

ing.

The Bank is exposed to many financial risks due to its

operating activities. The Bank analyses, evaluates,

accepts and manages risks, or risk portfolios at different

levels. The Bank’s main operating risks include credit

risk, market risk and liquidity risk. Market risks include

interest rate risk and exchange rate risk. The Bank’s

objective is to reach an appropriate balance between

risks and rewards, while minimising the negative impact

on its financial statements.

The Bank’s risk management policies aim to identify and

analyse risks to establish appropriate risk limits and

control measures, and to monitor risks and risk limits via

an information system.

The Bank’s Board of Directors is responsible for estab-

lishing the Bank’s risk management strategy. The Bank’s

Risk Management Committee is in charge of the man-

At the balance sheet dates, the Bank’s off-shore wealth

management services balances were as follows:

(1) Entrusted lending business

(1) Credit risk

(2) Custodian business

(3) Off-shore wealth management services

(3) Major customers

The Bank’s interest income generated from top ten

loans and advances customers was Renminbi 171,817,201

(2012: Renminbi 132,606,016), which contributed 6%

(2012: 4%) of the Bank’s total interest income of loans

and advances.

Operating income

from external customers

2013 2012

In Mainland China 5,833,614,039 6,019,384,895

Outside Mainland China

Outside Mainland China

405,919,014 420,763,470

6,239,533,053 6,440,148,365

Specified non-current assets

2013 2012

In Mainland China 277,877,943 312,978,730

- -

277,877,943 312,978,730

2013

2012

Entrusted loans 16,294,361,580 18,766,531,856

Entrusted funds 16,294,361,580 18,766,531,856

At the balance sheet dates, the Bank’s Qualified Foreign

Institutional Investors (QFII) and Qualified Domestic

Institutional Investors (QDII) balances were as follows:

2013

2012

QFII 81,385,783,540 75,682,252,678

QDII 37,041,939,069 8,655,813,030

2013

2012

Off -shore wealth

11,237,25 1,655 10,684,304,750

management services

Assets pledged as security

2013 2012

Secured liabilities - 7,920,000,000

Carrying value of pledged assets

analysed by balance sheet classification

Available -for -sale financial assets - 8,042,092,500

agement and supervision responsibilities related to risk

control of the Bank, including periodically assess the

Bank’s overall risk exposures, provide guidance for

developing a sound risk management and internal

control strategies and policies, and monitor their imple-

mentation. The Risk Management Committee reports to

the Board of Directors. The Bank’s senior management

is responsible for establishing risk management policies

and procedures, including specific risk management

policies for credit risk, interest rate risk and exchange

rate risk based on the risk management strategy

approved by Risk Management Committee and Board of

Directors. These risk management policies are

performed by different head office departments upon

approval from the Board of Directors. The internal audit

department of the Bank is responsible for independently

inspecting risk management and internal control.

Credit risk is the risk that one party to a financial instru

ment will cause a financial loss for the other party by

failing to discharge an obligation. Credit risk mainly

arises from credit business. In treasury transactions,

credit risk refers to the possibility that the value of the

assets held by the Bank may decrease due to a fall in the

rating of the issuer of the debt security.

Credit business

Considering the market economic environment,

business development strategy and the requirements of

clients, the Bank provides various direct credit and

direct credit substitute businesses in the scope of risk

control to foreign-invested companies set up in the PRC

by multinationals, domestic companies with good credit

94 95

41 Risk management

standing, as well as individual customers of good credit.

The Bank has established a strict credit management system, including credit approval, daily credit monitoring, reme-

dial management, policies for loan loss provisioning and loan write-off and restructuring.

The Bank adopts the loan risk classification approach introduced by Citigroup to monitor the risk condition of its loan

portfolios. Loans are classified by a five-tier grading system: pass / Pass Watch List (PWL), special mention/substand-

ard (accruing), substandard (non-accruing), doubtful and loss, according to risk levels. The five-tier grading for loans

and advances is defined as follows:

A comparison of the Bank’s loan risk classification criteria and Yin Jian Fa [2007] No. 54 has been filed with the CBRC as follows:

Internal credit Definition of corporate banking* */corporate

grading banking * banking***

Pass / PWL No evident weakness No overdue records Special Has potential weakness that deserve Overdue 1 -89 Mention /

management’s close attention. If left days substandard

uncorrected, the potential weakness

(accruing)

may result in deterioration of the

paying capacity or credit position of

the borrower at some future date

Substandard Inadequately protected by the current Overdue 90 - 179

(non -accruing) net assets and paying capacity of the days

borrower . Assets so classified must

have a well -defined weakness, or

weaknesses , that jeopardise the

timely repayment of its obligations,

certain losses might incur even

if collaterals are realised.

Doubtful With the added characteristic that Overdue 180 - 359

the weaknesses make collection or days

liquidation in full, on the basis of

current conditions, highly

questionable and improbable

Loss Uncollectible and of such little value Overdue over

that their continuance as bankable 360 days

assets is not warranted

Defintion of cunsumer

* The definition does not include corporate banking’s branch Small and Medium Enterprise (SME) loan product.

** The definition is taking personal mortgage loan for example. The consumer bank sets out different internal credit gradings

according to the overdue days for different products.

*** Corporate banking’s branch SME loan product applies the over-due method used by consumer banking.

Internal Five -tier grading Definition grading Definition

Pass / PWL No evident weakness Normal

Normal loans

Speical

Has potential weakness

Special mention

The repayment might beMention /

that deserves close

adversely affected by substandard attention

some factors

(accruing)

Substandard Has a well -defined Substandard The borrower ’s capacity (non - weakness that jeopardise to repay is apparently in

accruing)

the paying capacity of question and certain the borrower losses might occur even when guarantees are

executed

Doubtful Collection or liquidation Doubtful Cannot repay principal

in full high ly and interest in full and

questionable and significant losses will

improbable occur even when guarantees are executed

Loss

Uncollectible

Loss

Principal and interest

cannot be recovered after taking all possible

measures

The last three gradings of the CBRC’s five-tier classification are regarded as impaired loans and advances. If there is any indication of

objective evidence that impairment and impairment loss has occurred, the loan is classified as an impaired loans and advances. The

provision for impairment of impaired loans and advances shall be assessed collectively or individually based on the actual condition.

The Bank manages, restricts and controls identified centralised credit risks, especially credit risks centralised in a single borrower,

group or industry. The Bank sets limits on the same borrower, group or industry to optimise its credit risk structure. The Bank moni-

tors these risks regularly, and reviews them annually or more frequently if necessary. The Bank manages credit risk via timely analysis

of the borrower’s ability to repay the principal and interest, and adjusts its credit lines accordingly. Other specific risk management

and mitigation measures include the following:

The objective of credit commitment is to ensure the client obtains the funds needed. When the amount of credit commitment applied

by a client exceeds the credit line originally authorised, the Bank asks for a deposit from the client to reduce the related credit risk.

The Bank mitigates credit risk by obtaining collateral, guarantees and security from companies or individuals. The Bank has specified

categories of acceptable collateral, including properties, commercial assets (commercial properties and accounts receivables), and

financial instruments (bonds and stocks). To reduce credit risk, the Bank has stipulated discount rates for different collaterals (the

ratio between the fast cash realisable value to the market fair value of the collateral) to reflect the cash realisable value. For a loan

guaranteed by a third party, the Bank assesses the guarantor’s financial condition, historical credit record and ability to settle the

debts on behalf of the borrower.

Except for loans, collaterals or guarantees needed for other financial assets shall be determined by the nature of the instruments.

Generally, no collaterals are designated for investments in debt securities, treasury bonds and other notes, and financial instrument

portfolios are generally used as collateral for asset-backed securities.

Treasury business

The Bank sets credit limits based on the credit risk inherent in the products, counterparties and geographical area. The system closely

monitors the credit exposure on a real-time basis. The Bank regularly reviews its credit limit policies and routinely updates the credit

limits.

96 97

(a) Maximum credit risk exposure

(c) Distribution of amounts due from inter-banks in

terms of credit ratings of counterparties

(d) Distribution of debt securities in terms of credit

quality

41 Risk management

The last three gradings of the CBRC’s five-tier classification are regarded as impaired loans and advances. If there is any indication of

objective evidence that impairment and impairment loss has occurred, the loan is classified as an impaired loans and advances. The

provision for impairment of impaired loans and advances shall be assessed collectively or individually based on the actual condition.

The Bank manages, restricts and controls identified centralised credit risks, especially credit risks centralised in a single borrower,

group or industry. The Bank sets limits on the same borrower, group or industry to optimise its credit risk structure. The Bank moni-

tors these risks regularly, and reviews them annually or more frequently if necessary. The Bank manages credit risk via timely analysis

of the borrower’s ability to repay the principal and interest, and adjusts its credit lines accordingly. Other specific risk management

and mitigation measures include the following:

The objective of credit commitment is to ensure the client obtains the funds needed. When the amount of credit commitment applied

by a client exceeds the credit line originally authorised, the Bank asks for a deposit from the client to reduce the related credit risk.

The Bank mitigates credit risk by obtaining collateral, guarantees and security from companies or individuals. The Bank has specified

categories of acceptable collateral, including properties, commercial assets (commercial properties and accounts receivables), and

financial instruments (bonds and stocks). To reduce credit risk, the Bank has stipulated discount rates for different collaterals (the

ratio between the fast cash realisable value to the market fair value of the collateral) to reflect the cash realisable value. For a loan

guaranteed by a third party, the Bank assesses the guarantor’s financial condition, historical credit record and ability to settle the

debts on behalf of the borrower.

Except for loans, collaterals or guarantees needed for other financial assets shall be determined by the nature of the instruments.

The maximum exposure to credit risk is represented by the carrying amount of each financial asset, including derivative financial

instruments, in the balance sheet. The maximum exposure to credit risk in respect of these financial guarantees at the balance sheet

date is disclosed in Note 43(1).

(ii) The balances represent collectively assessed allowances of

impairment losses.

Market risk management involves an overall process of market

risks identification, measurement, monitoring and control.

Market risk refers to the risk of financial instruments’ fair value

or future cash flow fluctuations due to changes in market

prices, including foreign exchange risk, interest rate risk and

other price risk. Foreign exchange risk refers to the risk of

financial instruments’ fair value or future cash flow fluctuations

due to changes in foreign exchange rates; interest rate risk

refers to the risk of financial instruments’ fair value or future

cash flow fluctuations due to changes in interest rates; other

price risk refers to the market risks other than foreign

exchange risk and interest rate risk.

The Bank’s interest rate risk includes the risks arising from

mismatches of the term structures of assets and liabilities

related to banking business and from positions held for trading

purpose in treasury transactions. The Bank calculates its

interest rate risk exposure according to the maturity dates of

all its interest-bearing assets and liabilities, and performs daily

interest rate sensitivity analysis and periodical stress test.

Meanwhile, by closely observing interest rate trends (both in

Renminbi and foreign currency) and market interest rate

changes, the Bank conducts proper scenario analysis and

makes timely adjustments to the loan and deposit interest rates

(both in Renminbi and foreign currency) in line with the bench-

mark interest rates to reduce its interest rate risk.

The Bank’s foreign currency risk exposures mainly arise from

on balance sheet assets and liabilities designated in foreign

currencies and off balance sheet derivatives designated in

foreign currencies. The Bank’s main principle of currency risk

control is to match the assets and liabilities of the respective

individual currency to minimize the foreign exchange risk, and

to control the currency risk within limits set by the Bank. The

Bank, based on the guiding principles of Risk Management

The carrying amounts of debt securities analysed by the exter-

nal rating agency Standard & Poors’ designations at the

balance sheet dates were as follows:

Debt securities include trading financial assets and availa-

ble-for-sale financial assets.

(b) Distribution of loans and advances to customers in terms of credit quality

Note 2013 201 2

Impaired Individually assessed and impaired gross amount 289,243,568 271,365,674 Impairment losses (263,485,385) (243,010,357)

Carrying amount 25,758,183 28,355,317

--------------------- --------------------- Overdue but not impaired ( i ) - less than 90 days 305,702,824 62,797,395 - 90 days to 180 days 30,335,116 - Impairment losses ( ii ) (31, 846,719) (256,601)

Carrying amount 304,191,221 62,540,794

--------------------- --------------------- Neither overdue nor impaired Gross amount 61, 430,401,544 63,117,522,415 Impairment losses ( ii ) (372,422,552)

(257,908,845)

Carrying amount 61, 057,978,992 62,859,613,570

--------------------- ---------------------

Total carrying amount 61,387,928,396 62,950,509,681

(i) As at 31 December 2013, the overdue but not impaired loans and advances amounted to Renminbi 336,037,940. The covered

portion and uncovered portion of these loans and advances were Renminbi 92,689,699 and Renminbi 243,348,241, respectively. The

fair value of collaterals held against these loans and advances amounted to Renminbi 270,277,236.

The fair value of these collaterals was estimated by the Bank based on the external valuations adjusted after taking into account the

current realisation experience in view of the collaterals and pledges as well as the latest market situation.

Neither overdue

nor impaired - A to AAA 25,113,108,914 27,652,675,281 - B to BBB + 11,434,475,857 6,601,304,969 - unrated 1,810,741,932 1,843,793,164

Total carrying amount 38,358,326,703 36,097,773,414

2013 2012

- AAA 252,920,110 290,533,340 - AA- to AA + 20,242,820,418 19,357,583,826

Total 20,495,740,528 19,648,117,166

2013 2012

(2) Market riskGenerally, no collaterals are designated for investments in debt securities, treasury bonds and other notes, and financial instrument

portfolios are generally used as collateral for asset-backed securities.

Treasury business

The Bank sets credit limits based on the credit risk inherent in the products, counterparties and geographical area. The system closely

monitors the credit exposure on a real-time basis. The Bank regularly reviews its credit limit policies and routinely updates the credit

limits. Amounts due from inter-banks include deposits and placements

with inter-banks. Distribution of amounts due from inter-banks

in terms of credit quality mainly with reference to the external

rating agency Standard & Poors’ was as follows (counterparties

without external ratings are presented using their parent

companies’ ratings):

98 99

41 Risk management

Committee, relevant laws and regulations and the manage-

ment’s evaluation of the current environment, has set risk

tolerance limits, and minimises the mismatch of assets and

liabilities in different currencies via reasonable arrangements

on the source and usage of foreign currency capital. Foreign

currency exposures are managed based on business category,

delegated trader authorisation limits, currencies and risk

factors. The Bank conducts hedge transactions with overseas

branches of Citibank to offset exchange rate risks for deriva-

tives designated in foreign currencies.

The Bank classifies financial instruments into investment

portfolios held for trading and non-trading investment portfoli-

os to effectively monitor market risk. The Bank mainly manages

market risk via its market risk limit policy. According to the

CBRC’s Market Risk Management Guidelines for Commercial

Banks and Citigroup’s global risk management policy, the Bank

has established market risk limits and measurement policies to

set related limits and approval mechanism on all market risk

exposures. The policies illustrate the structure and approval

system of market risk limits. Market risk limits mainly include

risk factor limits, position limits, value-at-risk (VaR) limits and

stop-loss trigger.

VaR analysis

For investment portfolios held for trading, the Bank adopts VaR

analysis to evaluate market risk. VaR estimates potential losses

arising from changes in market interest rates and prices within

a defined period and confidence interval. The Bank’s market

risk management department calculates the VaR of investment

portfolios held for trading according to the historical changes

of the market interest rates and prices (confidence interval:

99%, observation time: 1 trading day).

Although VaR is an important tool for measuring market risk,

the assumptions on which the model is based do give rise to

some limitations, including the following:

— A 1-day holding period assumes that it is possible to hedge

or dispose of positions within that period. This is considered to

be a realistic assumption in almost all cases but may not be the

case in situations in which there is severe market illiquidity for

a prolonged period;

— A 99% confidence level does not reflect losses that may

occur beyond this level. Even with the model used there is 1%

probability that losses could exceed the VaR;

— VaR is calculated on an end-of-day basis and does not

reflect exposures that may arise on positions during the trading

day; and

— The use of historical data as a basis for determining the

possible range of future outcomes may not always cover all

possible scenarios, especially those of an exceptional nature.

A summary of the VaR of the Bank’s trading portfolios at the

balance sheet date and during the respective year is as follows:

(Renminbi million)

2013

As at 31 December Average Maximum Minimum

Interest rate risk 8.90 19.47 34.87 7.67

Foreign currency risk 8 .83 12.80 26.87 3.58 Total VaR 11.02 20.77 36.56 8.29

2012

As at 31 December Average Maximum Minimum

Interest rate risk 25.70 25.87 41.45 16.33

Foreign currency risk 12.52 11.70 21.09 3.66 Total VaR 28.95 30.01 43.93 21.17

To address the above limitations in VaR analysis, the Bank

performs retrospective tests periodically to ensure the effec-

tiveness of the relevant models. Furthermore, the Bank

performs market risk stress testing periodically to assess the

maximum losses under extreme price fluctuation scenarios.

(3) Liquidity risk

Liquidity risk is the risk that a financial institution fails to meet

its obligations related to financial liabilities due to lack of funds

caused by mismatches between the amounts and maturity

dates of assets and liabilities.

The primary liquidity risk management measure adopted by the

Bank is to match the maturity date structures between assets

and liabilities. Due to differences between various businesses

and maturity tenors, it is impractical to maintain a perfect

match between assets and liabilities. To meet relevant liquidity

requirements, the Bank has established a set of thresholds for

managing, measuring, monitoring and reporting liquidity risk,

including liquidity limits for normal operations, liquidity ratios,

market triggers and regular stress testing. In addition, the Bank

established Liquidity Funding Plan and Contingency Funding

Plan to maintain an appropriate balance of cash flows and to

ensure all the required funds can be provided at maturity.

The Finance department provides a daily calculation of regula-

tory liquidity ratios to relevant departments of the Bank. Global

Markets department is responsible for managing the liquidity

risk on daily basis and executes the liquid funds instructions.

Market Risk Management monitors the liquidity risk independe-

ntly. The Asset Liability Committee will also regularly review

the liquidity status of the Bank.

The following tables provide an analysis of the contractual

undiscounted cashflows of the Bank’s financial assets and

liabilities at the balance sheet dates. Interest receivable and

payable of financial assets and liabilities with fixed terms are

presented according to the due dates of interest stipulated in

the contracts; current financial assets and liabilities (including

interest receivable and payable as at the balance sheet dates)

are presented under the item “repayable on demand”. Since

derivatives are generally held for short-term purposes, their

cashflows are not included in the following analysis.

100 101

41 Risk management

2013

2013

Contractual Repayable undiscounted on demand / Within Carrying amount cashflows terms undated one month

Assets Cash on hand and deposits with central bank 26,885,794,247 26,885,794,247 26,885,794,247 - Deposits and placements with inter-banks 38,358,326,703 39,267,095,616 7,406,939,918 8,139,828,895 Trading financial assets 3,266,961,398 3,357,516,120 - 919,786,684 Derivative financial assets 2,828,654,593 2,828,654,593 2,828,654,593 - Available-for-sale financial assets 17,228,779,130 17,776,458,652 - 998,791,000 Loans and advances to customers 62,055,683,052 62,835,072,529 2,108,620,087 16,408,864,106 Other assets 2,116,473,400 2,116,473,400 1,668,074,187 76,444,600

Total assets 152,740,672,523 155,067,065,157 40,898,083,032 26,543,715,285

--------------- --------------- --------------- --------------- Liabilities Deposits and borrowings from inter-banks (31,093,649,384) (31,208,775,590) (8,871,124,754) (5,161,804,036) Derivative financial liabilities (2,844,811,150) (2,844,811,150) (2,844,811,150) - Deposits from customers (96,624,103,633) (96,829,178,027) (57,028,076,206) (21,096,401,268) Other liabilities (10,528,418,064) (10,705,280,438) (3,049,049,378) (328,368,663)

Total liabilities (141,090,982,231) (141,588,045,205) (71,793,061,488) (26,586,573,967)

--------------- --------------- --------------- --------------- Net position 11,649,690,292 13,479,019,952 (30,894,978,456) (42,858,682)

Between one Between Between month and three months one year and More than

three months and one year five years five years

Assets Cash on hand and deposits with central bank - - - - Deposits and placements with inter-banks 7,755,659,646 12,598,408,255 3,366,258,902 - Trading financial assets 300,655,584 1,508,782,051 547,939,618 80,352,183 Derivative financial assets - - - - Available-for-sale financial assets 49,567,550 12,091,942,652 4,636,157,450 - Loans and advances to customers 12,043,627,332 11,594,015,919 7,309,496,856 13,370,448,229 Other assets 46,070,466 209,384,459 116,306,373 193,315

Total assets 20,195,580,578 38,002,533,336 15,976,159,199 13,450,993,727

--------------- --------------- --------------- --------------- Liabilities Deposits and borrowings from inter-banks (4,925,593,245) (8,613,011,423) (3,637,242,132) - Derivative financial liabilities - - - - Deposits from customers (11,026,635,586) (5,292,226,575) (15,514,273) (2,370,324,119) Other liabilities (1,327,101,438) (4,178,347,135) (1,822,413,824) -


--------------- --------------- --------------- --------------- Net position 2,916,250,309 19,918,948,203 10,500,988,970 11,080,669,608

2012

2012

Contractual Repayable

Between one Between Between

undiscounted on demand / Within

month and three months one year and More than

Carrying amount cashflows terms undated one month

three months and one year five years five years

Assets Cash on hand and deposits with central bank 30,637,522,420 30,637,522,420 30,637,522,420 -

- - - -

Deposits and placements with inter-banks 36,097,773,414 36,403,894,356 12,408,955,148 9,099,832,442

5,215,999,658 8,681,254,972 997,852,136 -

Trading financial assets 3,512,945,036 3,770,131,347 - -

- 623,497,155 3,045,934,147 100,700,045

Derivative financial assets 1,690,055,766 1,690,055,766 1,690,055,766 -

- - - -

Available-for-sale financial assets 16,135,172,130 16,756,457,199 - -

- 8,145,071,577 8,611,385,622 -

Loans and advances to customers 63,451,685,484 75,869,163,243 1,625,299,986 13,412,044,752

19,725,625,236 12,717,046,422 10,535,569,201 17,853,577,646

Other assets 783,294,402 783,294,402 382,260,895 29,606,412

48,813,847 151,812,366 170,485,881 315,001

Total assets 152,308,448,652 165,910,518,733 46,744,094,215 22,541,483,606

24,990,438,741 30,318,682,492 23,361,226,987 17,954,592,692

--------------- --------------- --------------- ---------------

--------------- --------------- --------------- ---------------

Liabilities Deposits and borrowings from inter-banks (19,059,640,414) (19,132,376,867) (6,204,214,713) (6,355,350,214)

(1,178,378,110) (1,844,041,561) (3,550,392,269) -

Derivative financial liabilities (1,430,554,047) (1,430,554,047) (1,430,554,047) -

- - - -

Financial assets sold under repurchase agreements (7,920,000,000) (7,927,453,889) - (7,927,453,889)

- - - -

Deposits from customers (103,566,097,380) (108,825,303,786) (68,651,652,353) (19,732,060,205)

(10,721,544,697) (9,653,847,516) (66,199,015) -

Other liabilities (9,478,826,877) (9,478,826,877) (9,243,072,235) (36,919,974)

(62,268,663) (96,064,431) (40,501,574) -


(11,962,191,470) (11,593,953,508) (3,657,092,858) -

--------------- --------------- --------------- ---------------

--------------- --------------- --------------- ---------------

Net position 10,853,329,934 19,116,003,267 (38,785,399,133) (11,510,300,676)

13,028,247,271 18,724,728,984 19,704,134,129 17,954,592,692

Assets Cash on hand and deposits with central bank Deposits and placements with inter-banks Trading financial assets Derivative financial assets Available-for-sale financial assets Loans and advances to customers Other assets

Total assets

Liabilities Deposits and borrowings from inter-banks Derivative financial liabilities Financial assets sold under repurchase agreements Deposits from customers Other liabilities

Total liabilities

Net position

102 103

(4) Capital management

41 Risk management

The capital management of the Bank covers the calcula-

tion and reporting of capital adequacy ratio (CAR),

capital assessment and capital planning. The CAR of the

Bank represent its ability to operating healthily and

dealing with risks. The CAR management of the Bank

aims to ensure the Bank held adequate capital, which is

appropriate to risk exposure and consistent with risk

assessment result of the Bank, to meet the demand of

business operation and the requirement of relavant

regulatory. The capital planning aims to set a target

CAR which satisfies the Bank with the demand of future

business development strategy, risk appetite, risk man-

agement, external business environment and long-term

sustainability of various capital sources.

The prudent and solid concept of capital management

ensures the Bank to retain its capital at an adequate

level to support business development under all condi-

tions and to adjust CAR to a reasonable level timely and

effectively, if necessary.

The management monitor the utilisation of CAR and

regulatory capital according to the requirement of

CBRC. The capital of the Bank is composed of core tier

one capital, other tier one capital and tier two capital.

The Bank reported relevant information to CBRC on a

quarterly basis.

The scope of the Bank’s CAR calculation of the Bank

covers all branches and sub-branches located in main-

land China. Currently, the Bank does not have any over-

sea branches.

Commercial banks shall conform to the regulatory

requirements relating to capital adequacy ratio required

by CBRC. For systematicaly-impartant banks, the

adequacy ratio of core tier one capital shall not be less

that 8.5%; the adequacy ratio of tier one capital shall

not be less than 9.5%; and the capital adequacy ratio

shall not be less than 11.5%, as at 31 December 2018. For

non-systematically-important banks, the adequacy ratio

of core tier one capital shall not be less than 7.5%; the

adequacy ratio of tier one capital shall not be less than

8.5%; and the capital adequacy ratio shall not be less

than 10.5%, as at 31 December 2018. The CBRC also

required conmmercial banks to introduce reverse

capital during transition period. As at 31 December 2013,

for non-systematically-important banks, the adequacy

ratio of core tier one capital shall not be less that 5.5%;

the adequacy ratio of tier one capital shall not be less

than 6.5%; and the capital adequacy ratio shall not be

less than 8.5%.

Before 1 January 2013, the CBRC required the capital

adequacy ratio not to be less than 8%, and the adequa-

cy ratio of core capital not to be less than 4%. As at 31

December 2012, the capital adequacy ratio of the Bank

was calculated in accordance with the Administration of

Capital Adequacy Ratios of Commercial Banks Proce-

dures issued by the CBRC and other related laws and

regulations.

Since 1 January 2013, the capital adequacy ratio of the

Bank has been calculated in accordance with Adminis-

trative Measures on Capitals of Commercial Bank (For

Trial Implementation) issued by the CBRC and other

related laws and regulations. As at 31 December 2013,

the capital adequacy ratio of the Bank has been calcu-

lated in accordance with Administrative Measures on

Capitals of Commercial Bank (For Trial Implementation)

issued by the CBRC and other related laws and regula-

tions, and the calculation result is in compliance with the

regulatory capital requirements.

The risk weighted assets of on-balance sheet assets are

calculated based on various risk weights. The risk

weights are determined in consideration of the risk

factors of various assets, counterparties, markets and

other relevant aspects, as well as qualified collateral

and guarantee. The off-balance sheet exposures are

calculated by the similar methodology with adjustments

of contingent losses. The credit risk weighted assets for

counter parties in terms of over-the-counter derivative

transactions are the summation of defaulted risk

weighted assets and credit valuation adjustment risk

weighted assets. The market risk weighted assets are

measured by standard method. The operational risk

weighted assets are measured by basic indicator

method.

The capital adequacy ratio and relevant data of the

Bank are calculated on the basis of the financial state-

ments prepared in accordance with the CAS. The Bank is

in compliance with the regulatory capital requirements

during the year.

The adequacy ratio of core tier one capital, the adequa-

cy ratio of tier one capital and the capital adequacy ratio

as at 31 December 2013 calculated in accordance with

Administrative Measures on Capitals of Commercial

Bank (For Trial Implementation) and other related laws

and regulations are as follows:

31 December 2013

Net core tier one capital 11,387,658,134

Net tier one capital 11,387,658,134

Net capital 11,766,169,034

Total risk assets (a ) 82,770,443,222

Adequacy ratio of core tier one capital 13. 7 6 %

Adequacy ratio of tier one capital 13. 7 6 %

Capital adequacy ratio 14. 2 2 %

(a) The total risk assets are composed of weighted

credit risk assets, weighted market risk assets and

weighted operational risk assets. Weighted market

risk assets include 12.5x market risk assets.

The core capital adequacy ratio and capital adequacy

ratio as at 31 December 2012 calculated in accordance

with Administration of Capital Adequacy Ratios of Com-

mercial Banks Procedures and other related laws and

regulations were as follows:

31 December 2012 Core capital adequacy ratio 16.63%

Capital adequacy ratio 16.99%

104 105

42 Fair value of financial instruments

(1) Financial instruments measured at fair value

The following table presents the carrying value of financial

instruments measured at fair value as at 31 December across

the three levels of the fair value hierarchy. The level in the fair

value hierarchy within which the fair value measurement is

categorised in its entirety is determined on the basis of the

lowest level input that is significant to the fair value measure-

ment in its entirety. The levels are defined as follows:

Level 1 – fair value measurements using quoted prices in active

markets for identical assets or liabilities

Level 2 – fair value measurements using inputs other than

quoted prices included within Level 1 that are observable for the

asset or liability, either directly or indirectly

This category includes instruments using valuation technique:

quoted market prices in active markets for similar instruments;

quoted prices for identical or similar instruments in markets

that are considered less than active; or other valuation

techniques where all significant inputs are directly or indirectly

observable from market data.

Level 3 – fair value measurements using inputs for the asset or

liability that are not based on observable market data

This category includes all instruments where the valuation

technique includes inputs not based on observable data and the

unobservable inputs have a significant effect on the instru-

ment’s valuation. This category includes instruments that are

valued based on quoted prices for similar instruments where

significant unobservable adjustments or assumptions are

required to reflect differences between the instruments.

Fair values of financial assets and financial liabilities that are

traded in active markets are based on quoted market prices or

dealer price quotations. For all other financial instruments the

Bank determines fair values using valuation techniques.

Valuation techniques include net present value and discounted

cash flow models, comparison to similar instruments for which

market observable prices exist, polynomial option pricing

models and other valuation models. Assumptions and inputs

used in valuation techniques include risk-free and benchmark

interest rates, credit spreads and other premia used in estimat-

ing discount rates, bond and equity prices, foreign currency

exchange rates, equity and equity index prices and expected

price volatilities and correlations. The objective of valuation

techniques is to arrive at a fair value determination that

reflects the price of the financial instrument at the reporting

date, that would have been determined by market participants

acting at arm’s length.

The Bank uses widely recognised valuation models for deter-

mining the fair value of common and more simple financial

instruments, like interest rate and currency swaps that use only

observable market data and require little management judge-

ment and estimation. Observable prices and model inputs are

usually available in the market for listed debt and equity securi-

ties, exchange traded derivatives and simple over the counter

derivatives like interest rate swaps.

For more complex financial instruments, the Bank uses proprie-

tary valuation models, which usually are developed from recog-

nised valuation models. Some or all of the significant inputs into

these models may not be observable in the market, and are

derived from market prices or rates or are estimated based on

assumptions. Example of instruments involving significant

unobservable inputs include certain over the counter struc-

tured derivatives, certain loans and securities for which there is

no active market and retained interests in securitisations.

Valuation models that employ significant unobservable inputs

require a higher degree of management judgement and estima-

tion in the determination of fair value. Management judgement and estimation are usually required for selection of the appropriate

valuation model to be used, determination of expected future cash flows on the financial instrument being valued, determination of

probability of counterpart default and prepayments and selection of appropriate discount rates. For those more complex financial

instruments, the Bank performs calibration and back testing of models against observed market transactions and conduct regular

stress testing.

The Bank has an established control framework with respect to the measurement of fair values. The Bank’s processes include a

number of key controls that are designed to ensure that fair value is measured appropriately, particularly where a fair value model is

internally developed and used to price a significant product. Such controls include a model validation policy requiring that valuation

models be validated by qualified personnel, independent from those who created the models and escalation procedures, to ensure that

valuations using unverifiable inputs are identified and monitored on a regular basis by senior management. Approvals from both

market risk department and product control department must be obtained prior to the use of valuation methodologies. The Bank’s

valuation models are reviewed and approved by market risk department which is independent from the front office.

2013

Level 1 Level 2 Level 3 Total RMB RMB RMB RMB Assets Trading financial assets 8 3,207,050,428 59,910,970 - 3,266,961,398 Derivative financial assets 9 - 2,828,397,726 256,867 2,828,654,593 Available-for-sale financial assets 11 17,228,779,130 - - 17,228,779,130

Total 20,435,829,558 2,888,308,696 256,867 23,324,395,121

Liabilities Derivative financial liabilities 9 - 2,844,554,283 256,867 2,844,811,150

Note

Note

2012

Level 1 Level 2 Level 3 Total

RMB RMB RMB RMB Assets Trading financial assets 8 3,433,123,836 79,821,200 - 3,512,945,036 Derivative financial assets 9 - 1,687,789,911 2,265,855 1,690,055,766 Available-for-sale financial assets 11 16,135,172,130 - - 16,135,172,130

Total 19,568,295,966 1,767,611,111 2,265,855 21,338,172,932

Liabilities Derivative financial liabilities 9 - 1,428,288,192 2,265,855 1,430,554,047

106 107

42 Fair value of financial instruments43 Commitments and contingent liabilities

During the year ended 31 December 2013, there was no signifi-

cant transfer between instruments in Level 1 and Level 2.

During the year ended 31 December 2013, there was no change

in valuation techniques for fair value measurements.

The movement of fair value measurements in Level 3 of the

fair value hierarchy for the year is as follows:

201 3

Derivative Derivative F inancial financial

assets liabilities Total RMB RMB RMB

Balances at the beginning of the year 2,265,855 (2,265,855) - Total gains / (losses) - - in profit or loss 8,302,169 (8,302,169) - Settlements (10,311,157) 10,311,157 -

Balances at the end of the year 256,867 (256,867) -

Total gains / (losses) for the year

recognised

in profit or loss for

assets held at the end of the year 256,867 (256,867) -

Sensitivity analysis on fair value mearsurements in Level 3 of

the fair value hierarchy

The Bank’s Level 3 financial instruments are mainly structured

derivatives. Any deals between the Bank and its customers are

fully squared with other financial institutions and there is no

open position. Thus, although fair value measurements of Level

3 use inputs that are not based on observable market data and

the measurement is uncertain, there is no impact on the Bank’s

current year profit or equity if such judgement and estimation

on unobservable inputs changes.

(2) Fair value of other financial instruments (not measured at fair value)

(1) Credit commitments

(2) Credit risk weighted amount

The Bank’s other financial assets mainly include deposits with

central bank, deposits with inter-banks, placements with

inter-banks and loans and advances to customers.

Except for loans and advances to customers, most financial

assets are due within one year or are measured at fair value;

therefore their carrying amounts are close to their fair values.

Loans and advances to customers are recorded at amortised

cost less impairment losses (see Note 10). Since the interest

rates for loans and advances are adjusted on a real-time basis

based on the PBOC’s stipulated interest rates, and impaired

loans have been reduced at the amount of impairment losses

to reflect the recoverable amount, the carrying amounts of

loans and advances are close to their fair values.

The Bank’s financial liabilities that are recorded at amortised

cost mainly include deposits from inter-banks and non-bank

financial institutions, borrowings from inter-banks, financial

assets sold under repurchase agreements and deposits from

customers. As at the balance sheet date, the carrying amounts

of the Bank’s financial liabilities are close to their fair values.

The above assumptions and methodologies provide the

consistant basis for calculating the fair value of the Bank’s

assets and liabilities. However, because other financial institu-

tions may use different assumptions and methodologies, the

fair value disclosed by each financial institution may not be

comparable.

At any given time the Bank has outstanding commitments to

extend credit. The Bank provides loan commitments, unused

credit card facilities, financial guarantees and letters of credit

to guarantee the performance of customers to third parties.

The Bank assesses the potential loss of credit commitment on a

periodic basis and recognises liabilities if necessary.

The contractual amounts for loan commitments and credit card

unused facilities represent the total amounts if the Bank makes

the fully payments. The amounts in the table for guarantees

and letters of credit represent the maximum potential loss that

would be recognised at the balance sheet date if counterparties

failed to completely perform as contracted. Acceptances

comprise undertakings by the Bank to pay bills of exchange

drawn by customers. The Bank expects most acceptances to be

settled simultaneously with reimbursement from customers.

As the credit facilities may not be fully used upon maturity, the

contractual amount sets out below does not represent the

expected cash flow out in the future.

2013 2012

Contractual amount Unused credit card facilities 4,786,616,569 892,182,262Loan commitments - with an original maturity within one year 391,984,000 340,296,000 - with an original maturity of one year or over 1,194,156,563 1,835,802,955

6,372,757,132 3,068,281,217 --------------------- ---------------------

Standby letters of credit issued and guarantees 3,893,181,680 3,460,711,261Acceptances 645,835,153 930,318,098Letters of credit accepted 325,388,974 458,689,473Letters of credit issued 186,691,939 526,958,366Letters of credit confirmed 59,432,664 67,562,984

5,110,530,410 5,444,240,182 --------------------- --------------------- Total 11,483,287,542 8,512,521,399

Credit risk weighted amount of contingent

liabilities and commitments 3,662,655,242

2013

The capital adequacy ratio of the Bank as at 31 December 2012

was Renminbi 5,349,695,464, which was calculated in accord-

ance with the Administration of Capital Adequacy Ratios of

Commercial Banks Procedures (the Administration) issued by

the CBRC and other related laws and regulations. The Adminis-

tration was expired on 1 January 2013.

The credit risk weighted amount refers to the amount as

computed in accordance with the rules set out by the CBRC and

depends on the credit status of the counterparty and the matu-

108 109

(3) Operating lease commitments

(4) Capital commitments

rity characteristics. The risk weights used range from 0% to

150% of contingent liabilities and commitments. The credit risk

weighted amounts stated above have taken into account the

effects of bilateral netting arrangements.

As at 31 December, the total future minimum lease payments

under non-cancellable operating leases of properties were

payable as follows:

As at 31 December, the capital commitments of the Bank were

as follows:

2013 201 2

2013 2012

Within 1 year (inclusive) 290,439,790 256,611,906After 1 year but within 2 years (inclusive) 166,231,090 214,188,843

After 2 years but within 3 years (inclusive) 74,718,038 104,987,530After 3 years 40,106,719 47,325,141

Total 571,495,637 623,113,420

Leasehold improvement contracts entered

into but not performed or

performed partially 11,640,981 7,638,650 Purchase contracts entered into but

not performed - 762,496

Total 11,640,981 8,401,146

110

Documents

ANNUAL REPORT 2013 - Citi