Securities code: Beijing Capital Eco-Environment Protection Group Co.Ltd(600008) securities abbreviation: Beijing Capital Eco-Environment Protection Group Co.Ltd(600008) Announcement No.: pro 2022014 Beijing Capital Eco-Environment Protection Group Co.Ltd(600008)
Announcement on carrying out foreign exchange derivatives trading business
The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.
Beijing Capital Eco-Environment Protection Group Co.Ltd(600008) (hereinafter referred to as “the company”) convened the third extraordinary meeting of the eighth board of directors of the company in 2022 on March 31, 2022, deliberated and adopted the proposal on foreign exchange risk management plan, and the independent directors expressed their independent opinions on the matter, which needs to be submitted to the general meeting of shareholders for deliberation. The relevant information is hereby announced as follows:
1、 Reasons and purposes for carrying out foreign exchange derivatives trading business
In order to cooperate with the company to sell 100% equity of Beijing Capital Group NZ investment holding limited, effectively avoid risks in the foreign exchange market, improve the use efficiency of foreign exchange funds and lock in exchange costs. The company and its subsidiaries and grandchildren intend to carry out foreign exchange derivatives trading business for the purpose of hedging. See the company’s Announcement No. 2022013 for details of the assets sold this time.
2、 Types of foreign exchange derivatives trading business to be carried out by the company
The foreign exchange derivatives trading business to be carried out by the company and its subsidiaries and grandchildren is forward business, involving the settlement currencies of actual business, including but not limited to New Zealand dollar, Hong Kong dollar, RMB, etc.
3、 Amount, term and capital source of foreign exchange derivatives trading business
After the deliberation and approval of the third extraordinary meeting of the eighth board of directors in 2022, the company and its subsidiaries and grandchildren plan to carry out foreign exchange derivatives trading business with an amount of no more than NZ $1.581 billion, and authorize the general manager of the company to determine the financial institution according to the quotation of the financial institution. The company and its subsidiaries and grandchildren are engaged in foreign exchange derivatives trading business. The source of funds is their own funds and does not involve raised funds.
4、 Risk analysis and Countermeasures of foreign exchange derivatives trading business
The company’s foreign exchange derivatives trading business follows the prudent principle and does not carry out foreign exchange trading for the purpose of speculation. All foreign exchange derivatives trading business is based on normal operation and aims to avoid and prevent exchange rate risks. However, there are certain risks in foreign exchange derivatives trading:
1. Operational risk: derivative financial transactions are highly professional and complex, and the relevant business personnel do not timely and fully understand the derivative information and do not follow the specified operating procedures, which will bring operational risk. Countermeasures: the company has strictly formulated the measures for the management of overseas financing of Beijing Capital Eco-Environment Protection Group Co.Ltd(600008) group, which clearly stipulates the selection and approval authority of exchange rate and interest rate hedging product schemes, so as to control operational risks.
2. Legal risk: the transaction of foreign exchange derivatives is highly complex, involving forward businesses such as New Zealand dollar, Hong Kong dollar and RMB, with certain legal risks. Countermeasures: the company only carries out foreign exchange derivatives trading business with legally qualified large banks and other financial institutions. The company will carefully review the contract terms signed with the bank and strictly implement the risk management system to prevent legal risks.
4、 Accounting policies and accounting principles
The company conducts corresponding accounting and disclosure of foreign exchange derivatives trading business in accordance with the relevant provisions and guidelines of the Ministry of finance, such as accounting standards for Business Enterprises No. 24 – hedge accounting, accounting standards for Business Enterprises No. 22 – recognition and measurement of financial instruments, accounting standards for Business Enterprises No. 37 – Presentation of financial instruments, etc.
5、 Opinions of independent directors
The risk management business of foreign exchange derivatives carried out by the company and its subsidiaries is closely related to the operation and complies with the provisions of laws and regulations and relevant regulatory requirements. The company and its subsidiaries carry out foreign exchange derivatives risk management business, which is conducive to effectively avoiding the risks in the foreign exchange market, preventing large fluctuations in exchange rates, locking in exchange costs, and finding no damage to the rights and interests of the company and shareholders, nor any situation that may lead to significant risks of the company; The company shall abide by the principles of legality, prudence, safety and effectiveness, strictly implement the relevant provisions of internal control, strengthen the management of financial derivatives business and timely assess the risk exposure. All independent directors unanimously agreed that the company and its subsidiaries should carry out foreign exchange derivatives risk management business, and agreed that the matter should be submitted to the general meeting of shareholders for deliberation.
It is hereby announced.
Beijing Capital Eco-Environment Protection Group Co.Ltd(600008) board of directors March 31, 2022
