Guangzhou Yuexiu Financial Holdings Group Co.Ltd(000987) : work report of the board of directors in 2021

Guangzhou Yuexiu Financial Holdings Group Co.Ltd(000987)

Work report of the board of directors in 2021

Guangzhou Yuexiu Financial Holdings Group Co.Ltd(000987) shareholders:

2021 is the first year of the 14th five year plan of the company. In the face of a more complex and severe external environment, the board of directors of the company adheres to the guidance of "finance serves the real economy and promotes high-quality development", practices the national strategy, serves the real economy and promotes all major work of the company.

1、 Overall operation and management of the company in 2021

In 2021, focusing on the "14th five year plan" strategic plan and the annual work theme of "strengthening the foundation, consolidating the foundation, improving quality, optimizing the structure and promoting development", the company achieved a new high in its main business indicators, with an operating revenue of 13.314 billion yuan, a year-on-year increase of 37.44%; After deducting non recurring profits and losses, the net profit attributable to shareholders of listed companies was 2.492 billion yuan, a year-on-year increase of 56.05%. By the end of 2021, the total assets of the company were 153331 billion yuan, and the net assets attributable to shareholders of listed companies were 25.147 billion yuan, an increase of 23.61% and 7.25% respectively over the end of the previous year. The company's main business initiatives are as follows:

(I) deep cultivation of main business and stable layout of core business

The non-performing assets business has maintained a leading position in the primary market share of non-performing assets in Guangdong Province, and has been approved with the business qualification of "single transferee to the public" and "approval and transfer of non-performing personal loans". The market share of approval and transfer of non-performing personal loans is leading in the country; The new investment of financial leasing business throughout the year hit a record high, the investment of Pratt & Whitney leasing business has been continuously increased, and the investment structure has been continuously optimized; The investment management business ABS investment is more mature, the first mover advantage of s fund is prominent, and equity investment has captured a number of high-quality equity investment projects, among which Shangtang technology and other projects have successfully landed in the capital market; The institutional transformation of futures business has achieved remarkable results, the business varieties of risk management subsidiaries have gradually matured, and the ability to grasp market opportunities of advantageous varieties has been further enhanced. (II) optimize the allocation and continuously enhance the business development momentum

Guangzhou assets completed two rounds of capital increase totaling 3.113 billion yuan, and introduced Guangzhou Hengyun, a strategic investor. Its capital strength ranks in the forefront of local asset management companies in China; Yuexiu leasing completed a capital increase of 1 billion yuan and Shanghai Yuexiu leasing completed a capital increase of 2 billion yuan. Its capital strength ranks in the forefront of foreign financial leasing companies; Guangzhou futures completed a capital increase of 1 billion yuan and Guangzhou phase capital completed a capital increase of 300 million yuan, and the capital strength continued to increase; Strategically increase Citic Securities Company Limited(600030) shares and fully participate in Citic Securities Company Limited(600030) share allotment. As of March 10, 2022, the company holds Citic Securities Company Limited(600030) shares, accounting for 7.73%, and the position of the second largest shareholder has been further consolidated; The company signed a 2 billion yuan perpetual debt agreement with its controlling shareholders to continuously enhance the capital strength of listed companies.

(III) serve the national development strategy, fulfill corporate social responsibility and help rural revitalization

First, prevent and defuse regional financial risks and promote the upgrading of regional industrial structure. In 2021, Guangzhou assets, a subsidiary, actively participated in the batch acquisition and disposal of non-performing assets of financial enterprises in Guangdong Province to improve the asset quality of regional financial institutions; Bail out entity enterprises, carry out bankruptcy reorganization of a leading agricultural machinery enterprise in Guangdong, and help it upgrade its technology. Second, it serves the livelihood project related to the foundation of national economic development. In 2021, Yuexiu leasing, a subsidiary, provided direct rental service of shield machine to the construction enterprises of water resources allocation project in the Pearl River Delta of Guangdong Province, provided financial leasing support for people-friendly fields such as Guangzhou metro vehicle procurement, Guangzhou bus new energy bus and water bus green travel replacement, continued to increase support for local enterprises, and helped the high-quality development of enterprises in Guangdong, Hong Kong, Macao and the Great Bay area. Third, the investment business aims at the direction of scientific and technological innovation and industrial upgrading. The investment sector focuses on the strategic industries vigorously developed by the country, such as independent chips, new energy and biomedicine, responds to the national strategic deployment and helps the industrial upgrading. Fourth, with the help of financial product and service innovation, inject financial "living water" into rural revitalization. The subsidiary Guangzhou futures deeply promoted the new financial poverty alleviation model of "insurance + futures", and provided risk protection services for nearly 7000 farmers in aquaculture industry, such as Dingxi City, Gansu Province and Pu'er City, Yunnan Province, so as to provide important guarantee for boosting agricultural development and disaster prevention and loss reduction.

(IV) stick to the bottom line and optimize comprehensive risk management

The company's various risk management and internal control work are effectively promoted to ensure the compliance and stable operation of various businesses; Continuous review and optimization of credit risk rating system; Carry out special supervision and inspection to ensure process compliance and effective internal control; Upgrade the comprehensive risk management system; We will continue to strengthen post investment management and asset protection.

(V) adhere to the guidance of Party building and strive to promote the construction of corporate culture

Guided by the thought of Xi Jinping socialism with Chinese characteristics in the new era and focusing on the study and education of party history, the company gives full play to the leading role of Party construction, promotes the deep integration of Party construction and production and operation, and provides a strong political and organizational guarantee for the good start of the 14th five year plan; Adhering to leading the construction of corporate culture in the new era with new ideas, closely combined with the development strategy of the 14th five year plan, we have widely carried out a series of work on corporate culture, strengthened the dissemination of corporate culture, continuously enhanced cultural consensus and action, and formed the company's vision and mission, as well as the management philosophy and 30 codes of conduct of "being steady, professional, collaborative, innovative and based on the struggle".

2、 Main work of the board of directors in 2021

In 2021, the company held 21 board meetings and passed 69 proposals; The five special committees under the board of directors held 22 meetings to study, discuss, put forward opinions and suggestions on professional matters, giving full play to the role of the special committee of the board of directors. The convening of each meeting was in line with the provisions of the company law, the articles of association and relevant laws and regulations.

In 2021, the board of directors of the company focused on the following work:

(I) system construction

In 2021, the company revised the articles of association, rules of procedure of the general meeting of shareholders, rules of procedure of the board of directors, management system of information disclosure, management system of connected transactions, internal audit system and other systems in combination with the latest revision of the regulatory laws, regulations, rules and normative documents of listed companies and the actual situation of the company, so as to provide institutional guarantee for the legal and compliant operation of the company.

(II) organizational structure adjustment

In 2021, in order to effectively conform to the company's digital transformation strategy and effectively support strategic decision-making and business development, the company renamed the functional department "information technology department" as "Digital Technology Department"; In order to further improve the overall research level, carry out forward-looking and practical research on innovative business and deeply serve the main business, the functional department "Financial Research Institute" was renamed "Financial Research Institute".

(III) senior management appointment and salary management

1. Appoint deputy general manager. In order to further improve the company's IT Governance and control system, create an intelligent application platform, realize the digital enabled financial business, and accelerate the digital transformation, the board of directors appointed Mr. Li Wenwei as the deputy general manager of the company, in charge of information technology, until the end of the term of office of the current board of directors.

2. Adjust executive compensation.

In 2021, according to the benchmarking analysis of market salary data and advocating the salary concept guided by business indicators and business performance, the board of directors agreed to adjust the salary of senior managers.

3. Implement the tenure system of managers and contractual management. According to the work deployment of state-owned enterprise reform and relevant requirements of state-owned assets supervision, combined with the actual situation of operation and management, the board of directors deliberated and approved the tenure system and contractual management work plan of the management of the company and its holding subsidiaries, effectively improved the company's performance appraisal management system and incentive and restraint mechanism, fully mobilized the initiative and creativity of the management, effectively stimulated the vitality of operation and development, and promoted the sustainable and healthy development of the company.

(IV) review major investment and financing matters

1. Strategically increase Citic Securities Company Limited(600030) shares. In August 2021, the board of directors deliberated and approved the proposal on increasing Citic Securities Company Limited(600030) shares, and agreed that the company or its subsidiaries would increase Citic Securities Company Limited(600030) shares with no more than HK $2.3 billion (including the principal amount) or equivalent RMB. At present, the investment is progressing steadily. As of March 10, 2022, the company directly and indirectly held Citic Securities Company Limited(600030) 1146 million shares, accounting for 7.73% of Citic Securities Company Limited(600030) total share capital, further consolidating the position of Citic Securities Company Limited(600030) second largest shareholder.

2. Debt financing. In 2021, the company publicly issued corporate bonds with a scale of 3 billion yuan, and issued medium-term notes, short-term financing bonds and ultra short-term financing bonds with a total scale of 10 billion yuan. In accordance with the relevant requirements of the measures for the administration of corporate bond issuance and trading, the company established a special account for the raised funds of various phases of corporate bonds for the reception, storage, transfer, collection and management of interest exchange and cashing funds of bond raised funds; The scale of corporate bonds issued by the company's holding subsidiaries is 5 billion yuan, and the total scale of non-financial enterprise debt financing instruments such as medium-term notes, short-term financing bonds, ultra short-term financing bonds, ABN and PPN is about 11.8 billion yuan. By the end of 2021, the above-mentioned bond raised funds have been used up, which is consistent with the purpose, use plan and other agreements promised in the prospectus.

(V) convening the general meeting of shareholders

In accordance with laws, regulations and the articles of association, the board of directors of the company earnestly performed the duties of convener of the general meeting of shareholders. In 2021, the board of directors convened five general meetings of shareholders and deliberated on proposals

The board of directors of the company strictly implemented the resolutions of the general meeting of shareholders, and successfully completed the profit distribution in 2020, the appointment of accounting firms, the revision of the articles of association and other related work.

(VI) related party transaction management

The audit committee of the board of directors of the company is responsible for fully investigating and giving opinions on major related party transactions. The independent directors of the Company review and give independent opinions on major related party transactions in advance, ensuring that related party transactions are carried out in accordance with general business principles and principles conducive to the overall interests of shareholders of the company.

The board of directors of the company carried out related party transactions in strict accordance with the Listing Rules of Shenzhen Stock Exchange, the management system of information disclosure and the management measures of related party transactions. The related party transactions of the company followed the principles of fairness, openness and fairness, and the signing of related party transaction agreements followed the principles of equality, voluntariness, equivalence and compensation.

The non affiliated directors of the board of directors and the audit committee of the board of directors reviewed the company's annual daily connected transaction forecast, occasional major connected transaction matters and annual implementation respectively.

(VII) major guarantee management

In 2021, the company and its holding subsidiaries did not provide guarantees for the controlling shareholders, actual controllers and other related parties, any unincorporated units or individuals. The guarantee matters occurred were the guarantees provided by the company's holding subsidiaries. All guarantee acts have performed the necessary review and disclosure procedures, comply with the provisions of relevant laws and regulations and the articles of association, and will not damage the interests of the company and the majority of investors.

(VIII) internal control evaluation

According to the basic norms of enterprise internal control and its supporting guidelines and other

On the basis of daily supervision and special supervision, the company evaluated the effectiveness of internal control on December 31, 2021 (benchmark date of internal control evaluation report), formed the company's internal control self-evaluation report in 2021, and Zhitong Certified Public Accountants (special limited partnership) conducted an independent audit on the implementation of the company's internal control, It is believed that the company has maintained effective internal control over financial reporting in all major aspects in accordance with the requirements of the enterprise internal control standard system and relevant regulations, and no major defects in non-financial reporting internal control have been found.

(IX) comprehensive risk management

In 2021, the company continued to optimize the comprehensive risk management mechanism. The risk and Capital Management Committee of the board of directors reviews the company's comprehensive risk management report every quarter, comprehensively understands the company's risk management and capital management, regularly evaluates the company's risk status and risk control ability, guides the revision of risk strategies such as risk policies and limits, defines the requirements for the proportion of the investment scale of the main core business and core areas, and formulates annual industry (business) guidelines such as urban infrastructure, real estate and non-performing asset management, Adjust the access standards for investment businesses such as fof and s fund, listen to the construction of comprehensive risk management system and system, further upgrade the comprehensive risk management system, and complete the docking of control platform with Guangzhou assets and Yuexiu leasing core business system.

(x) implement profit distribution plan

The board of directors of the company pays attention to the implementation of shareholder returns, implements a positive, continuous and stable profit distribution policy, and returns the good operating performance of the company to the majority of investors. The 2020 profit distribution plan of the company, based on the total share capital of 2752884754 shares, distributed cash dividends of 2.5 yuan (including tax) to all shareholders for every 10 shares with undistributed profits on August 25, 2021, and increased 3.5 shares for every 10 shares with capital reserve to all shareholders. The plan has been implemented.

（11） Do a good job in Information Disclosure

The board of directors of the company shall earnestly and timely perform the obligation of information disclosure in strict accordance with the relevant provisions of the Listing Rules of Shenzhen Stock Exchange and the information disclosure management system of listed companies, so as to ensure the authenticity, accuracy and integrity of information disclosure. In 2021, the company disclosed 184 announcements of listed companies, the quality of information disclosure continued to improve, and was rated as the highest grade a again in the information disclosure assessment of listed companies by Shenzhen Stock Exchange.

（12） Investor relations management

The board of directors of the company attaches great importance to investor relations management and actively participates in investor relations management activities with an active, sincere and efficient attitude to continuously improve investors' understanding of the company. The company set up special personnel to receive shareholders' visits and consultations, and made every effort to build and continuously improve the investor communication mechanism. In order to facilitate investors to further understand the company's operation, the company organized online annual and semi annual performance briefings during the reporting period, actively participated in collective roadshows of listed companies, themed strategy meetings of securities companies, online roadshows of investors and other activities within its jurisdiction, and improved communication with investors, Nine records of investor relations activities were released throughout the year.

3、 Performance of directors

In 2021, the directors of the company complied with laws and regulations and the articles of association, and faithfully and diligently performed their duties and obligations. The directors of the company shall attend the meetings of the board of directors and relevant special committees in accordance with the regulations, carefully consider various topics and clearly put forward their own opinions and suggestions. When the board of directors is not in session, it can