中國銀行股份有限公司 BANK OF CHINA...

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your licensed

securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Bank of China Limited (中國銀行股份有限公司) (the “Bank”), you

should at once hand this circular and the enclosed proxy form and reply slip to the purchaser or transferee or to the bank or

licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or

transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the

contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability

whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

中國銀行股份有限公司BANK OF CHINA LIMITED

(a joint stock company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 3988)

ANNUAL GENERAL MEETING

A notice convening the Annual General Meeting of Bank of China Limited to be held at Grand Hyatt Hong Kong, 1 Harbour

Road, Hong Kong, China and at the Multi-function Hall, B2, Bank of China Head Offi ce Building, No.1 Fuxingmen Nei Dajie,

Beijing, China at 9:30 a.m. on Thursday, 12 June 2014 (registration will begin at 8:30 a.m.) is set out in pages 5 to 7 of this

circular.

Whether or not you are able to attend the Annual General Meeting, you are advised to read the notice of Annual General

Meeting and to complete and return the enclosed proxy form in accordance with the instructions printed thereon. For H-Share

Holders, the proxy form should be returned to the Bank’s H Share Registrar, Computershare Hong Kong Investor Services

Limited in person or by post as soon as possible but in any event not less than 24 hours before the time stipulated for

convening the Annual General Meeting or any adjourned meeting thereof. Completion and return of the proxy form will not

preclude you from attending and voting at the Annual General Meeting or at any adjourned meeting if you so wish.

If you intend to attend the Annual General Meeting in person or by proxy, you are required to complete and return the reply

slip to the Bank’s Board Secretariat or to Computershare Hong Kong Investor Services Limited on or before Thursday, 22

May 2014.

The English and Chinese versions of this circular and the accompanying form of proxy and reply slip are available on the

Bank’s website at www.boc.cn and the website of Hong Kong Exchanges and Clearing Limited at www.hkexnews.hk. You

may access the aforesaid documents by clicking “Investor Relations” on the homepage of the Bank’s website or browsing

through the website of Hong Kong Exchanges and Clearing Limited.

25 April 2014

— i —

CONTENTS

Page

DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

NOTICE OF ANNUAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

APPENDIX I BUSINESS OF THE ANNUAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

ATTACHMENT A 2013 WORK REPORT OF THE BOARD OF DIRECTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

ATTACHMENT B 2013 WORK REPORT OF THE BOARD OF SUPERVISORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

ATTACHMENT C 2013 ANNUAL FINANCIAL STATEMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

ATTACHMENT D CAPITAL MANAGEMENT PLAN OF BANK OF CHINA FOR 2013–2016 . . . . . . . . . . . . . . . . . . . 28

APPENDIX II 2013 REPORT ON CONNECTED TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

APPENDIX III 2013 DUTY REPORT OF INDEPENDENT DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

— 1 —

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions shall have the following meanings:

“A Shares” Domestic shares with nominal value of RMB1.00 each in the share capital

of the Bank which are listed on the Shanghai Stock Exchange (stock code:

601988)

“A-Share Holder(s)” Holder(s) of A Shares

“AGM” or “Annual General Meeting” The annual general meeting of the Bank to be held at Grand Hyatt Hong Kong,

1 Harbour Road, Hong Kong, China and at the Multi-function Hall, B2, Bank of

China Head Offi ce Building, No.1 Fuxingmen Nei Dajie, Beijing, China at 9:30

a.m. on Thursday, 12 June 2014 (registration will begin at 8:30 a.m.)

“Articles of Association” Articles of Association of the Bank amended at the 2013 First Extraordinary

General Meeting of the Bank held on 26 March 2013 and approved by the

CBRC in May 2013

“Bank” or “Bank of China” Bank of China Limited (中國銀行股份有限公司), a joint stock limited company

incorporated in the PRC, the H Shares and A Shares of which are listed on the

Hong Kong Stock Exchange and the Shanghai Stock Exchange, respectively

“Board” or “Board of Directors” The Board of Directors of the Bank

“Board of Supervisors” The Board of Supervisors of the Bank

“CBRC” China Banking Regulatory Commission

“Company Law” The Company Law of the PRC (as amended from time to time)

“CSRC” China Securities Regulatory Commission

“Director(s)” The Director(s) of the Bank

“Executive Director(s)” The Executive Director(s) of the Bank

“External Supervisor(s)” The External Supervisor(s) of the Bank

“Group” or “BOC Group” The Bank and its subsidiaries

“Huijin” Central Huijin Investment Ltd. (the Bank’s controlling shareholder)

H Shares” Overseas listed foreign shares with nominal value of RMB1.00 each in the

share capital of the Bank which are listed on the Hong Kong Stock Exchange

and traded in Hong Kong dollars (stock code: 3988)

“H-Share Holder(s)” Holder(s) of H Shares

“Hong Kong” The Hong Kong Special Administrative Region of the PRC

“Hong Kong Dollar” Hong Kong dollar, the lawful currency of Hong Kong

“Hong Kong Listing Rules” The Rules Governing the Listing of Securities on The Stock Exchange of Hong

Kong Limited (as amended from time to time)

— 2 —

DEFINITIONS

“Hong Kong Stock Exchange” The Stock Exchange of Hong Kong Limited

“Independent Non-executive Director(s)” or

“Independent Director(s)”

The Independent Non-executive Director(s) of the Bank

“Non-executive Director(s)” The Non-executive Director(s) of the Bank

“PRC” The People’s Republic of China

“RMB” Renminbi, the lawful currency of the PRC

“Supervisor(s)” The Supervisor(s) of the Bank

— 3 —

LETTER FROM THE BOARD



(Stock Code: 3988)

Board of Directors:

Mr. Tian Guoli (Chairman)

Mr. Chen Siqing

Mr. Li Zaohang

* Ms. Sun Zhijun

* Ms. Liu Lina

* Mr. Zhang Xiangdong

* Mr. Zhang Qi

* Mr. Wang Yong

** Mr. Chow Man Yiu, Paul

** Mr. Jackson Tai

** Mr. Nout Wellink

** Mr. Lu Zhengfei

** Mr. Leung Cheuk Yan

Registered Offi ce:

No. 1 Fuxingmen Nei Dajie

Beijing 100818

PRC

Place of Business in Hong Kong:

8th Floor

Bank of China Tower

1 Garden Road

Hong Kong

* Non-Executive Directors

** Independent Non-executive Directors

25 April 2014

Dear H-Share Holders,

1. INTRODUCTION

On behalf of the Board of Directors, I invite you to attend the AGM to be held at Grand Hyatt Hong Kong, 1 Harbour

Road, Hong Kong, China and at the Multi-function Hall, B2, Bank of China Head Offi ce Building, No.1 Fuxingmen Nei

Dajie, Beijing, China at 9:30 a.m. on Thursday, 12 June 2014 (registration will begin at 8:30 a.m.).

The purpose of this circular is to provide you with all the information reasonably necessary to enable you to make an

informed decision on whether to vote for or against the proposed resolutions at the AGM.

2. BUSINESS TO BE CONSIDERED AT THE AGM

The items of business to be considered at the AGM are described in detail in the notice of AGM set out in pages 5 to 7

of this circular. At the AGM, ordinary resolutions will be proposed to approve (i) the Proposal regarding the 2013 Work

Report of the Board of Directors; (ii) the Proposal regarding the 2013 Work Report of the Board of Supervisors; (iii)

the Proposal regarding the 2013 Annual Financial Statements; (iv) the Proposal regarding the 2013 Profi t Distribution

Plan; (v) the Proposal regarding the 2014 Annual Budget for Fixed Assets Investment; (vi) the Proposal regarding the

Appointment of Ernst & Young Hua Ming as the Bank’s External Auditor for 2014; (vii) the Proposal regarding Capital

Management Plan of Bank of China for 2013–2016; (viii) the Proposal regarding the Election of Directors of the Bank;

(ix) the Proposal regarding the Re-election of External Supervisors of the Bank; and (x) the Remuneration Plan for the

Chairman, Executive Directors, Chairman of Board of Supervisors and Shareholder Representative Supervisors of 2012.

— 4 —

LETTER FROM THE BOARD

In order to enable you to have a better understanding of the resolutions to be proposed at the AGM and to make an

informed decision thereof, we have provided in this circular detailed background information, including the relevant

information and explanation, to the resolutions to be proposed at the AGM (see Appendix I).

Pursuant to the relevant regulatory requirements, the annual Report on Connected Transactions and the annual Duty

Report of Independent Directors are matters to be reported to the Annual General Meeting but not for shareholders’

approval. The 2013 Report on Connected Transactions and the 2013 Duty Report of Independent Directors of the Bank

are set out in Appendix II and Appendix III to this circular for shareholders’ information.

3. THE AGM

The proxy form and the reply slip of the AGM are also enclosed herewith.

If you intend to appoint a proxy to attend the AGM, you are required to complete and return the enclosed proxy form in

accordance with the instructions printed thereon as soon as possible. For H-Share Holders, the proxy form should be

returned to the Bank’s H Share Registrar, Computershare Hong Kong Investor Services Limited in person or by post

as soon as possible but in any event not less than 24 hours before the time stipulated for convening the AGM or any

adjourned meeting thereof. Completion and return of the proxy form will not preclude you from attending and voting at

the AGM or at any adjourned meeting if you so wish.

If you intend to attend the AGM in person or by proxy, you are required to complete and return the reply slip to the

Bank’s Board Secretariat or to Computershare Hong Kong Investor Services Limited on or before Thursday, 22 May

2014.

The Bank’s Board Secretariat is located at Bank of China Head Offi ce Building, No. 1 Fuxingmen Nei Dajie,

Beijing 100818, the PRC (Telephone: (8610) 6659 4750 or (8610) 6659 2756, Fax: (8610) 6659 4579, E-mail:

[email protected]). The Bank’s H Share Registrar, Computershare Hong Kong Investor Services Limited, is located

at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong (Telephone: (852) 2862 8555).

4. VOTING BY POLL

Pursuant to the Hong Kong Listing Rules, each of the resolutions set out in the Notice of AGM will be voted on by

poll. Results of the poll voting will be published on the Bank’s website at www.boc.cn and the website of Hong Kong

Exchanges and Clearing Limited at www.hkexnews.hk after the AGM.

5. RECOMMENDATION

The Board of Directors considers that the proposed resolutions set out in the Notice of AGM are in the interests of the

Bank and its shareholders as a whole. Accordingly, the Board of Directors recommends the shareholders to vote in

favour of the proposed resolutions.

Yours faithfully,

By order of the Board

Bank of China Limited

Tian Guoli

Chairman

— 5 —

NOTICE OF ANNUAL GENERAL MEETING



(Stock Code: 3988)


NOTICE IS HEREBY GIVEN that the Annual General Meeting (“AGM” or “Annual General Meeting”) of Bank of China

Limited (the “Bank”) will be held at Grand Hyatt Hong Kong, 1 Harbour Road, Hong Kong, China and at the Multi-function

Hall, B2, Bank of China Head Offi ce Building, No.1 Fuxingmen Nei Dajie, Beijing, China at 9:30 a.m. on Thursday, 12 June

2014 (registration will begin at 8:30 a.m.) for the purpose of considering and approving the following resolutions:

ORDINARY RESOLUTIONS

1. To consider and approve the Proposal regarding the 2013 Work Report of the Board of Directors

2. To consider and approve the Proposal regarding the 2013 Work Report of the Board of Supervisors

3. To consider and approve the Proposal regarding the 2013 Annual Financial Statements

4. To consider and approve the Proposal regarding the 2013 Profi t Distribution Plan

5. To consider and approve the Proposal regarding the 2014 Annual Budget for Fixed Assets Investment

6. To consider and approve the Proposal regarding the Appointment of Ernst & Young Hua Ming as the Bank’s External

Auditor for 2014

7. To consider and approve the Proposal regarding the Capital Management Plan of Bank of China for 2013–2016

8. To consider and approve the Proposal regarding the Election of Directors of the Bank

8.1 To consider and approve the Re-election of Mr.Zhang Xiangdong as Non-executive Director of the Bank

8.2 To consider and approve the Re-election of Mr. Zhang Qi as Non-executive Director of the Bank

8.3 To consider and approve the Re-election of Mr. Jackson Tai as Independent Non-executive Director of the Bank

8.4 To consider and approve the Election of Mr. Liu Xianghui as Non-executive Director of the Bank

9. To consider and approve the Proposal regarding the Re-election External Supervisors of the Bank

9.1 To consider and approve the Re-election of Mr. Mei Xingbao as External Supervisor of the Bank

9.2 To consider and approve the Re-election of Ms. Bao Guoming as External Supervisor of the Bank

— 6 —


10. To consider and approve the Remuneration Plan for the Chairman, Executive Directors, Chairman of Board of

Supervisors and Shareholder Representative Supervisors of 2012

By Order of the Board

Bank of China Limited

Yeung Cheung Ying

Company Secretary

25 April 2014

As at the date of this announcement, the Directors of the Bank are: Tian Guoli, Chen Siqing, Li Zaohang, Sun Zhijun*, Liu

Lina*, Zhang Xiangdong*, Zhang Qi*, Wang Yong*, Chow Man Yiu, Paul#, Jackson Tai#, Nout Wellink#, Lu Zhengfei# and Leung

Cheuk Yan#

* Non-executive Directors# Independent Non-executive Directors

Notes:

1. Details of the above resolutions are set out in Appendix I of this circular. Additional information of the 2013 Work Report

of the Board of Directors, the 2013 Work Report of the Board of Supervisors, the 2013 Annual Financial Statements

and the Capital Management Plan of Bank of China for 2013–2016 are set out in Attachment A, Attachment B,

Attachment C and Attachment D of this circular respectively.

2. Pursuant to the relevant regulatory requirements, the annual Report on Connected Transactions and the annual Duty

Report of Independent Directors are reporting matters to Annual General Meeting but not for shareholders’ approval.

The 2013 Report on Connected Transactions and the 2013 Duty Report of Independent Directors of the Bank are set

out in Appendix II and Appendix III of this circular for shareholders’ information.

3. The Board of Directors has recommended a fi nal dividend of RMB0.196 per share (before tax) for the year ended 31

December 2013 and, if such proposed dividend distribution set out in Resolution No.4 is approved by the shareholders,

the fi nal dividend will be distributed to those shareholders whose names appear on the register of shareholders of the

Bank on Thursday, 26 June 2014.

As stipulated by the Notice on Issues relating to Enterprise Income Tax Withholding over Dividends Distributable to

Their H-Share Holders Who are Overseas Non-resident Enterprise by Chinese Resident Enterprises (Guoshuihan [2008]

No.897) published by State Administration of Taxation, PRC, when Chinese resident enterprises distribute annual

dividends for 2008 onwards to H-Share Holders who are overseas non-resident enterprises, the enterprise income tax

shall be withheld at a uniform rate of 10%. Under current practice of the Inland Revenue Department of Hong Kong, no

tax is payable in Hong Kong in respect of dividends paid by the Bank.

In accordance with the relevant PRC tax regulations, the dividend received by overseas resident individual shareholders

from the stocks issued by domestic non-foreign investment enterprises in Hong Kong is subject to the payment

of individual income tax, which shall be withheld by the withholding agents. However, overseas resident individual

shareholders of the stocks issued by domestic non-foreign investment enterprises in Hong Kong are entitled to the

relevant preferential tax treatment pursuant to the provisions in the tax agreements signed between the countries in

which they are residents and China, or the tax arrangements between the Chinese mainland and Hong Kong and

Macau. Accordingly, the Bank will withhold 10% of the dividend to be distributed to the individual H-Share Holders as

individual income tax unless otherwise specifi ed by the relevant tax regulations and tax agreements.

— 7 —


The H-Share register of shareholders of the Bank will be closed from Monday, 23 June 2014 to Thursday, 26 June

2014 (both days inclusive) for the purpose of determining the list of shareholders entitled to the fi nal dividend. For

such entitlements, H-Share Holders who have not registered the related transfer documents are required to lodge

them, together with the relevant share certifi cates, with the H Share Registrar of the Bank, Computershare Hong Kong

Investor Services Limited, at Shops 1712–1716, 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong

Kong at or before 4:30 p.m. on Friday, 20 June 2014. The ex-dividend date of the Bank’s Shares will be on Thursday,

19 June 2014.

4. Pursuant to the Hong Kong Listing Rules, each of the resolutions set out in the Notice of AGM will be voted on by

poll. Results of the poll voting will be published on the Bank’s website at www.boc.cn and the website of Hong Kong

Exchanges and Clearing Limited at www.hkexnews.hk after the AGM.

5. Any shareholder entitled to attend and vote at the AGM convened by the above notice is entitled to appoint one or more

proxies to attend and vote instead of him/her. A proxy need not be a shareholder of the Bank.

6. In order to be valid, the instrument appointing a proxy together with the power of attorney or other authority, if any,

under which it is signed, or a notarially certifi ed copy of such power of attorney or authority, must be completed and

deposited at the H Share Registrar of the Bank, Computershare Hong Kong Investor Services Limited, at least 24 hours

before the AGM or any adjourned meeting thereof. Computershare Hong Kong Investor Services Limited is located at

17M Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong. Completion and return of a proxy form

will not preclude a shareholder from attending and voting at the AGM or any adjourned meeting thereof should he/she

so wish.

7. The H-Share register of shareholders of the Bank will be closed, for the purpose of determining shareholders’

entitlement to attend the AGM, from Tuesday, 13 May 2014 to Thursday, 12 June 2014 (both days inclusive), during

which period no transfer of shares will be registered. In order to attend the Annual General Meeting, all share transfers,

accompanied by the relevant share certifi cates, must be lodged for registration with the Bank’s H Share Registrar,

Computershare Hong Kong Investor Services Limited at Shops 1712–1716, 17M Floor, Hopewell Centre, 183 Queen’s

Road East, Wan Chai, Hong Kong, not later than 4:30 p.m. on Monday, 12 May 2014. H-Share Holders who are

registered with Computershare Hong Kong Investor Services Limited on or before the aforementioned date are entitled

to attend the Annual General Meeting.

8. In case of joint shareholdings, the vote of the senior joint shareholder who tenders a vote, whether in person or by

proxy, will be accepted to the exclusion of the votes of the other joint shareholder(s) and for this purpose seniority will

be determined by the order in which the names stand in the register of shareholders of the Bank in respect of the joint

shareholding.

9. Shareholders who intend to attend the Annual General Meeting in person or by proxy should return the reply slip for

the Annual General Meeting to the Board Secretariat of the Bank or the Bank’s H Share Registrar, Computershare

Hong Kong Investor Services Limited, by hand, by post, by fax or by e-mail on or before Thursday, 22 May 2014. The

address of the Bank’s Board Secretariat is Bank of China Head Offi ce Building, No. 1 Fuxingmen Nei Dajie, Beijing

100818, PRC (Telephone: (8610) 6659 4750 or (8610) 6659 2756, Fax: (8610) 6659 4579, E-mail: [email protected]).

Computershare Hong Kong Investor Services Limited is located at 17M Floor, Hopewell Centre, 183 Queen’s Road

East, Wan Chai, Hong Kong (Telephone: (852) 2862 8555).

10. Shareholders who attend the meeting in person or by proxy shall bear their own traveling, dining and accommodation

expenses. Shareholders or their proxies shall produce their identity documents when attending the AGM.

— 8 —

APPENDIX I BUSINESS OF THE ANNUAL GENERAL MEETING

1. THE PROPOSAL REGARDING THE 2013 WORK REPORT OF THE BOARD OF DIRECTORS

According to the relevant regulatory requirements and the provisions of Articles of Association, the “2013 Work Report

of the Board of Directors of Bank of China Limited” was considered and approved by the Board on 26 March 2014.

Details of the above work report of the Board are set out in Attachment A to this circular.

2. THE PROPOSAL REGARDING THE 2013 WORK REPORT OF THE BOARD OF SUPERVISORS

In accordance with the relevant regulatory requirements and the provisions of the Articles of Association, the “2013

Work Report of the Board of Supervisors of Bank of China Limited” was considered and approved by the Board of

Supervisors on 26 March 2014.

Details of the above work report of the Board of Supervisors are set out in Attachment B to this circular.

3. THE PROPOSAL REGARDING THE 2013 ANNUAL FINANCIAL STATEMENTS

In accordance with International Financial Reporting Standards, for the year ended 31 December 2013, the Group

achieved an after tax profi t for the year of RMB163.741 billion, representing a year-on-year increase of 12.35%.

Earnings per share reached RMB0.56. The Group’s return on average total assets stood at 1.23%. The Group’s

common equity tier 1 capital adequacy ratio was 9.69%, tier 1 capital adequacy ratio was 9.70%, and its capital

adequacy ratio was 12.46%.

In 2013, the Group earned a net interest income of RMB283.585 billion, representing an increase of 10.36% compared

with the prior year, and a non-interest income of RMB123.924 billion, an increase of 13.47% compared with the

prior year, among which the net fee and commission income reached RMB82.092 billion, representing an increase of

17.40%; the operating expenses were RMB172.314 billion, an increase of 7.88% compared with the prior year; and

the impairment losses on assets were RMB23.510 billion, representing a year-on-year increase of 21.27%. In 2013, the

Group incurred income tax expense of RMB49.036 billion, an increase of 16.96% compared with the prior year.

As at 31 December 2013, the Group’s total assets reached RMB13,874.299 billion, an increase of 9.41% compared

with the prior year-end, among which the Group’s net loans and advances to customers amounted to RMB7,439.742

billion, an increase of 10.87%; and the Group’s total liabilities amounted to RMB12,912.822 billion, an increase of

9.25% compared with the prior year-end. The Group’s deposits from customers amounted to RMB10,097.786 billion,

an increase of 10.07%. and the Group’s total equity was RMB961.477 billion, an increase of 11.60% compared to the

prior year-end.

Please refer to the Group’s “Consolidated Income Statement”, “Consolidated Statement of Financial Position”, and

“Consolidated Statement of Changes in Equity” prepared in accordance with the International Financial Reporting

Standards as set out in Attachment C to this circular. All of the above statements are excerpted from the audited

financial statements of the Group for the year 2013 prepared in accordance with the International Financial Reporting

Standards. The complete 2013 audited financial statements are available on the Bank’s website at www.boc.cn and the

website of Hong Kong Exchanges and Clearing Limited at www.hkexnews.hk.

— 9 —


4. THE PROPOSAL REGARDING THE 2013 PROFIT DISTRIBUTION PLAN

According to the audited results for 2013 and relevant laws and regulations, the Profi t Distribution Plan of the Bank for

the year 2013 is proposed as follows:

(1) Appropriation to statutory surplus reserve of RMB14.863 billion.

(2) Appropriation to general and regulatory reserves of RMB12.545 billion.

(3) No appropriation shall be made to the discretionary reserve.

(4) Considering the bank’s business performance, fi nancial position, and the capital requirements for future

development of the Bank, it is proposed to distribute RMB0.196 per share (before tax) as dividend to A-share

Holders and H-share Holders whose names appear on the register of shareholders of the Bank as at the close of

market on Thursday, 26 June 2014.

(5) The Bank is not proposing any capitalization of capital reserve into share capital for this profi t distribution.

(6) The 2013 fi nal dividend of the Bank will be denominated and declared in RMB and be paid in RMB or equivalent

amount in Hong Kong Dollars. The dividend paid in Hong Kong Dollars will be converted from RMB based on the

average exchange rate prevailing one week before Thursday, 12 June 2014 (such day inclusive), being the date

for holding the Annual General Meeting, as announced by the People’s Bank of China.

5. THE PROPOSAL REGARDING THE 2014 ANNUAL BUDGET FOR FIXED ASSETS INVESTMENT

In 2014, the investment of fi xed assets of the Bank will focus on operating performance, implement differentiated

resource allocation, allocate the limit resources to demands for fi xed assets investment that can increase production

capacity and improve customer service level, etc. The Bank will also give priority to the demands for fi xed asset

investments in the development of internet banking, integration and transformation of overseas system as well as

transition of outlets. The Bank will strictly control investment in general fi xed assets, such as offi ce buildings and

transportation vehicles. In 2014, the budget for fi xed assets investment of the Group is RMB19.8 billion; the details are

listed as below:

Items

(unit: RMB100 million)

Group

Domestic

Institutions

Overseas

Institutions

2014 Budget 2014 Budget 2014 Budget

Construction of premises

of comprehensive business 58.0 50.0 8.0

Channel construction 47.9 41.0 6.9

IT input 58.3 47.7 10.6

Comprehensive operation machines and tools 33.8 30.7 3.1

Total 198.0 169.4 28.6

— 10 —


6. THE PROPOSAL REGARDING THE APPOINTMENT OF ERNST & YOUNG HUA MING AS THE BANK’S

EXTERNAL AUDITOR FOR 2014

The Board of Directors proposed to engage Ernst & Young Hua Ming LLP as the Bank’s domestic auditor and

external auditor on internal control for 2014 where it will offer auditing service on the Bank’s fi nancial statements in

accordance with China Accounting Standards as well as internal control auditing service, and to engage Ernst & Young

as the Bank’s international auditor for 2014 where it will offer auditing service on the Bank’s fi nancial statements in

accordance with International Financial Reporting Standards, with an aggregate fee of RMB152.7 million for 2014 which

includes the fi nancial statement audit fee of RMB137.7 million and the internal control audit fee of RMB15 million.

7. THE PROPOSAL REGARDING THE CAPITAL MANAGEMENT PLAN OF BANK OF CHINA FOR 2013-2016

The Capital Management Plan of Bank of China for 2013–2016 was considered and approved by the Board on 30

October 2013. It is hereby submitted to the shareholders’ meeting for consideration and approval according to the

relevant regulatory requirements and the provisions of the Articles of Association.

The Capital Management Plan of Bank of China for 2013–2016 is set out in Attachment D to this circular.

8. THE PROPOSAL REGARDING THE ELECTION OF DIRECTORS OF THE BANK

Terms of offi ce of Non-executive Directors Mr. Zhang Xiangdong, Mr. Zhang Qi, and Independent Non-executive

Director Mr. Jackson Tai are to expire on the date of the 2013 Annual General Meeting. According to the Articles of

Association of the Bank, Directors shall be elected by the shareholders’ meeting and serve a term of offi ce of three

years. A Director may serve consecutive terms if re-elected upon the expiration of his/her term.

Based on their willingness to be re-elected as Directors and upon the approval by the Board of Directors of the Bank

on 26 March 2014, it is proposed by the Board of Directors that Mr. Zhang Xiangdong and Mr. Zhang Qi be re-elected

as Non-executive Directors of the Bank, Mr. Jackson Tai be re-elected as Independent Non-executive Director of the

Bank. Their terms of offi ce will be three years which will commence from the date of approval by the shareholder’s

meeting and end on the date of the Bank’s annual general meeting to be held in 2017.

Ms. Jiang Yansong resigned from the position of Non-executive Director of the Bank as of 20 November 2013. Upon

the approval by the Board of Directors of the Bank on 26 March 2014, it is proposed by the Board of Directors that Mr.

Liu Xianghui be elected as Non-executive Directors of the Bank. Term of offi ce of Mr. Liu Xianghui will be three years

which will commence from the date of approval by CBRC and end on the date of the Bank’s annual general meeting to

be held in 2017.

The biographical details of Mr. Zhang Xiangdong, Mr. Zhang Qi, Mr. Jackson Tai and Mr. Liu Xianghui are as follows.

Mr. Zhang Xiangdong, born in 1957, has been serving as Non-executive Director of the Bank since July 2011. Mr.

Zhang served as a Non-executive Director of China Construction Bank Corporation from November 2004 to June

2010, and served as Chairman of the Risk Management Committee under its board of directors from April 2005 to

June 2010. From August 2001 to November 2004, Mr. Zhang worked as Vice President of PBOC’s Haikou Central

Sub-branch and concurrently served in the SAFE as Deputy Director General of Hainan Province Branch and Deputy

Director General and Inspector of the General Affairs Department. Mr. Zhang served as a member of the Stock Offering

Approval Committee of CSRC from September 1999 to September 2001. Mr. Zhang holds the professional title of

senior economist and is qualifi ed to practice law in China. He served as a member of China International Economic and

Trade Arbitration Commission from January 2004 to December 2008. Mr. Zhang graduated from Renmin University of

China with a Bachelor’s degree in law in 1986. He completed his post-graduate studies in international economic law

at Renmin University of China in 1988, and was awarded a Master’s degree in Law in 1990. Mr. Zhang Xiangdong is

currently an employee of Huijin.

— 11 —


Mr. Zhang Qi, born in 1972, has been serving as Non-executive Director of the Bank since July 2011. Mr. Zhang

worked in Central Expenditure Division One, Comprehensive Division of the Budget Department, and Ministers’ Offi ce of

the General Offi ce of Ministry of Finance, as well as the Operation Department of China Investment Corporation, serving

as Deputy Director, Director and Senior Manager from 2001 to 2011. Mr. Zhang studied in the Investment Department

and Finance Department of China Northeast University of Finance and Economics from 1991 to 2001, and obtained the

Bachelor’s degree, Master’s degree and Doctorate in Economics respectively in 1995, 1998 and 2001. Mr. Zhang Qi is

currently an employee of Huijin.

Mr. Jackson Tai, born in 1950, has been serving as Independent Non-executive Director of the Bank since March

2011. Mr. Tai has over 35 years of experience in the banking industry. He held various key positions in DBS Group

Holdings Limited (“DBS Group”) and DBS Bank Limited (“DBS Bank”) including Vice Chairman and Chief Executive

Offi cer of DBS Group and DBS Bank from 2002 to 2007, President and Chief Operating Offi cer of DBS Group and

DBS Bank from 2001 to 2002, and Chief Financial Offi cer of DBS Bank from 1999 to 2001. He was also a Director of

DBS Bank (China) Limited from 2007 to 2008. Prior to that, he was with J.P. Morgan & Co. Incorporated from 1974

to 1999. He was Managing Director in the Investment Banking Division and held senior management positions in New

York, Tokyo and San Francisco. He currently serves as a director of a number of companies listed in New York and

Singapore, including director of Eli Lilly and Company since 2013, director of Singapore Airlines since 2011, director of

Royal Philips NV since 2011, and director of MasterCard Incorporated since 2008. Mr. Tai is a director of privately-held

VaporStream, and is also a director of privately held Russell Reynolds Associates since 2013. Previously, Mr. Tai was a

director of NYSE Euronext from 2010 to 2013, ING Group NV from 2008 to 2010, and CapitaLand from 2001 to 2010.

Mr. Tai is also currently a member of the Asia-Pacifi c Advisory Board of Harvard Business School, trustee of Rensselaer

Polytechnic Institute, director of the Metropolitan Opera in New York, and a director and member of the Committee

of 100. Mr. Tai graduated from Rensselaer Polytechnic Institute with a Bachelor of Science degree in 1972, and from

Harvard University with a Masters of Business Administration degree in 1974.

Mr. Liu Xianghui, born in 1954, has been serving as the external supervisor of China Cinda Asset Management

Corporation Limited since June 2013. He served as the Non-executive Director of China Cinda Asset Management

Company from June 2010 to June 2013, and Non-executive Director of China Construction Bank from September

2004 to June 2010. From September 1978 to May 1994, he held various positions at the State Economic Commission,

the Land Planning and Local Economic Department of the State Planning Commission. From May 1994 to September

2004, he worked consecutively as the division chief of the Industry and Transportation Group, assistant inspector

(deputy director-general level) and inspector (director-general level) of the Economic and Trade Group under the Offi ce

of Central Leading Group on the Financial and Economic Affairs. Mr. Liu graduated from Liaoning University in August

1978, and studied the senior courses of national economic planning at the Central College of Planning and Statistics

of Poland from October 1989 to February 1990. He also studied modern economic management at Beijing Economic

Correspondence University from April 1985 to April 1986. Mr. Liu is a senior Economist. Mr. Liu Xianghui is currently an

employee of Huijin.

Currently, the remuneration of the Bank’s directors are as follows: (i) Non-executive Directors (excluding Independent

Non-executive Directors) do not receive remuneration from the Bank. (ii) The pre-tax remuneration of Independent

Non-executive Directors of the Bank as approved by the shareholders’ meeting of the Bank are set out as follows:

basic remuneration of RMB200,000 per year; an additional duty allowance of RMB200,000 per year will be paid to

the chairman of the Risk Policy Committee or the chairman of the Audit Committee; and an additional duty allowance

of RMB100,000 per year will be paid to the chairman of other special committees. and an additional duty allowance

of RMB50,000 per year will be paid to the persons being members of special committees. The remuneration of an

Independent Non-executive Director who holds positions concurrently in several committees will be calculated in an

accumulative manner.

— 12 —


As far as the Directors of the Bank are aware and save as disclosed above, the aforementioned candidates for Directors

did not hold any directorship in other public companies, the securities of which are listed on any securities market in

Chinese mainland, Hong Kong or overseas in the last three years, nor do they have any other relationship with any

Director, senior management or substantial or controlling shareholder of the Bank. As at the date of this circular,

the aforementioned candidates for Directors do not have any interests in the shares of the Bank or its associated

companies according to Part XV of the Hong Kong Securities and Futures Ordinance (including but not limited to the

shares and convertible bonds of the Bank). Save as disclosed above, none of the above candidates for Directors hold

any other position with the Bank or any of its subsidiaries.

Save as disclosed above, there is no other information in relation to the appointment of the aforementioned candidates

for Directors that needs to be disclosed pursuant to any of the requirements set out in Rule 13.51(2)(h) to (v) of the

Hong Kong Listing Rules, nor are there any other matters that need to be brought to the attention of the shareholders

of the Bank. The aforementioned candidates for Directors have not been penalized by the CSRC or other relevant

departments or stock exchanges.

The re-election of Mr. Jackson Tai as Independent Non-executive Director is conditional upon the non-objection

clearance of the Shanghai Stock Exchange. The Bank has received the confi rmation in writing from Mr. Jackson Tai

with regard to his independence, which has been submitted to the relevant regulator.

9. THE PROPOSAL REGARDING THE RE-ELECTION OF EXTERNAL SUPERVISORS OF THE BANK

Terms of offi ce of External Supervisors Mr. Mei Xingbao and Ms. Bao Guoming are to expire on the date of the 2013

Annual General Meeting. According to the Articles of Association of the Bank, External Supervisors shall be elected

by the shareholders’ meeting and serve a term of offi ce of three years. An External Supervisor may serve consecutive

terms if re-elected upon the expiration of his/her term.

Based on their willingness to be re-elected as External Supervisors and upon the approval by the Board of Supervisors

of the Bank on 26 March 2014, it is proposed by the Board of Supervisors that Mr. Mei Xingbao and Ms. Bao Guoming

be re-elected as External Supervisors of the Bank. Their terms of offi ce will be three years which will commence from

the date of approval by the shareholder’s meeting and end on the date of the Bank’s annual general meeting in 2017.

The biographic details of Mr. Mei Xingbao are as follows: Mr. Mei Xingbao, born in 1949, External Supervisor of the

Bank since May 2011. Mr. Mei is now a member of the 12th CPPCC National Committee and serves as independent

non-executive director of Sino Biopharmaceutical Ltd. From October 2003 to May 2010, Mr. Mei served as Vice

President and President of China Orient Asset Management Corporation. He previously served as Vice Mayor of

People’s Municipal Government of Zhangjiajie in Hunan Province, Deputy Director General of Economic and Trade

Commission of Hunan Province, Head of the Science and Education Group of the Research Offi ce of the General Offi ce

of the CPC Central Committee, Director General of the General Offi ce of the Central Financial Working Commission,

and Director General of the Propaganda Department of CBRC. Majoring in agricultural economic management, Mr. Mei

graduated from Renmin University of China in 1982 with a Bachelor’s degree in Economics. He obtained his Doctorate

in Management from Renmin University of China in 1999.

The biographic details of Ms. Bao Guoming are as follows: Ms. Bao Guoming, born in 1951, External Supervisor of

the Bank since May 2011. Ms. Bao is now Vice President and Secretary-General of China Institute of Internal Audit. In

1999, Ms. Bao was transferred to the National Audit Offi ce and worked in several positions, including Deputy Director

General, Director General of Cadres Training Centre and Director General of the Administrative Audit Department. She

is a professor of the Accounting Department of Nankai University. She concurrently acts as a part-time professor in

the Research Institute for Fiscal Science under the Ministry of Finance, Shanghai Jiao Tong University, Beijing National

Accounting Institute and other universities and research institutions, as an executive director of the China Audit

Academy, and as a member of the Senior Auditor Certifi cation Examination and Review Committee of the National Audit

Offi ce. Ms. Bao is a Certifi ed Public Accountant of Chinese Institute of Certifi ed Public Accountants and a Certifi ed

International Internal Auditor and receives the Government Special Allowance of the State Council. Ms. Bao graduated

from Tianjin University of Finance and Economics in 1985 and received a Master’s degree in Economics.

— 13 —


The pre-tax remuneration of the External Supervisors of the Bank as approved by the shareholders’ meeting of the

Bank are set out as follows: basic remuneration of RMB180,000 per year; an additional duty allowance of RMB80,000

per year will be paid to the chairman of the Duty Performance and Due Diligence Supervision Committee or the Finance

and Internal Control Supervision Committee; and an additional duty allowance of RMB40,000 per year will be paid to

External Supervisors being members of special committees. The remuneration of an External Supervisor who holds

positions concurrently in several committees will be calculated in an accumulative manner.

As far as the Supervisors of the Bank are aware and save as disclosed above, the above External Supervisors did

not hold any directorship or supervisor position in other public companies, the securities of which are listed on any

securities market in Chinese mainland, Hong Kong or overseas in the last three years, nor do they have any relationship

with any Director, Supervisor, senior management or substantial or controlling shareholder of the Bank. As at the date

of this circular, the above External Supervisors do not have any interests in the shares of the Bank or its associated

companies according to Part XV of the Hong Kong Securities and Futures Ordinance (including but not limited to the

shares and convertible bonds of the Bank). Save as disclosed above, none of the above External Supervisors hold any

other position with the Bank or any of its subsidiaries.

Save as disclosed above, there is no other information in relation to the appointment of the above External Supervisors

that needs to be disclosed pursuant to any of the requirements set out in Rule 13.51(2)(h) to (v) of the Hong Kong

Listing Rules, nor are there any other matters that need to be brought to the attention of the shareholders of the

Bank. The above External Supervisors have not been penalized by the CSRC or other relevant departments or stock

exchanges.

10. THE REMUNERATION PLAN FOR THE CHAIRMAN, EXECUTIVE DIRECTORS, CHAIRMAN OF BOARD OF

SUPERVISORS AND SHAREHOLDERS’ REPRESENTATIVE SUPERVISORS OF 2012

According to the applicable policies of the PRC and the relevant administrative measures of the Bank and on the basis

of the 2012 annual performance appraisal results of the Chairman, Executive Directors, Chairman of the Board of

Supervisors and Shareholder Representative Supervisors, the remuneration plan for the above mentioned persons of

2012 is proposed as follows:

Remuneration Plan for the Chairman and Executive Directors

Unit: RMB Thousand (before tax)

Name Position

Annual

Basic Salary

Annual

Performance

Bonus

Xiao Gang1 Chairman 495 1135.2

Li Lihui2 Vice Chairman, President 445.5 1021.7

Li Zaohang Executive Director, Executive Vice President 428.1 981.8

Wang Yongli3 Executive Director, Executive Vice President 428.1 981.8

1 Due to the needs of national fi nancial work, Mr. Xiao Gang resigned from his positions as the Chairman of the

Board of Directors, Executive Director, Chairman and member of the Strategic Development Committee of the

Board of Directors of the Bank on 17 March 2013.

2 Due to age reason, Mr. Li Lihui resigned from his positions as Vice Chairman of the Board of Directors, Executive

Director, member of the Strategic Development Committee of the Board and President of the Bank on 28

January 2014.

3 Due to the change of work, Mr. Wang Yongli resigned from his positions as Executive Director, member of the

Risk Policy Committee of the Board of Directors and Executive Vice President of the Bank on 16 April 2014.

— 14 —


Remuneration Plan for the Chairman of Board of Supervisors and Shareholder Representative Supervisors

Unit: RMB Thousand (before tax)

Name Position

Annual

Basic Salary

Annual

Performance

Bonus

Li Jun Chairman of Board of Supervisors 433.1 993.3

Wang Xueqiang Supervisor 386.1 874.3

Liu Wanming Supervisor 361.4 802.3

In accordance with the relevant government regulations, over 50% of the Chairman, President, Executive Directors,

Chairman of Board of Supervisors’ performance bonus will be deferred in its payment according to the business results

of the Bank in the future years. The period for deferred payment shall not be less than three years.

The above Remuneration Plan has been approved in accordance with relevant procedures, please refer to the

Supplementary Information Regarding the Remuneration for Directors, Supervisors and Senior Management Members

in 2012 released by the Bank on 29 May 2013.

— 15 —

ATTACHMENT A 2013 WORK REPORT OF THE BOARD OF DIRECTORS

2013 WORK REPORT OF THE BOARD OF DIRECTORS

The year 2013 witnessed the slow recovery of the world economy and smooth progress of the Chinese economy. In the

face of the unprecedented opportunities and challenges brought by the speedup of interest rate liberalization reform and the

internet fi nance, the Board of Directors of the Bank pushed forward the Bank’s innovation in fi nancial services and business

transition in line with changes in macro-economic situations, helped drive the real economy, further strengthened risk

management and internal control, continuously improved the Group’s corporate governance mechanism and highlighted its

differentiated competitive advantages, according to the latest domestic and foreign regulatory requirements. The audit results

show that the Bank generated a net profi t of RMB163.741 billion in 2013, an increase of 12.35% over the previous year;

net profi t attributable to the parent company reached RMB156.911 billion, an increase of 12.36%; earnings per share was

RMB0.56, an increase of RMB0.06; the return on average total assets was 1.23%, an increase of 0.04 percentage points;

asset quality remained stable in the year, while non-performing loan ratio was controlled at a relatively low level.

The Board of Directors of the Bank performed its duties diligently and implemented resolutions of the shareholders’ general

meetings earnestly. In 2013, the Board of Directors convened two shareholders’ general meetings, which reviewed and

approved 23 proposals; the Board of Directors held 19 meetings onsite or by circulation of written resolutions which reviewed

and approved 55 proposals and debriefed nine reports. A report on the Board’s major work in 2013 runs as follows:

I. Strengthen Strategic Decision-making Function and Develop into the Best Bank as Early as Possible

i. Draw up a strategic plan and guarantee the Bank’s sustainable and healthy development

In 2013, the Board of Directors reviewed and approved the Strategic Development Plan of Bank of China for

2013–2016, in keeping with the changes in macro-economic situation. For the purpose of “assuming social

responsibility and being the best bank”, the Plan clarifi es the Bank’s general requirements, specifi c objectives

and implementation plan for development in 2013–2016. At the stage of developing the Plan, the Board of

Directors earnestly heard the report of the Management on preparation of the strategic plan, grasped the

strategic direction, paid particular attention to capital management, IT and talent strategies, understood the

plan framework and overall ideas, guided the preparation and effectively strengthened the function of strategic

decision-making.

ii. Enhance capital management and continuously improve capital use effi ciency

In 2013, the Bank was identifi ed as a global systemically important fi nancial institution again. In the face of the

increasingly stricter capital supervision of global banking industry, the Board of Directors reviewed and approved

the Capital Management Plan of Bank of China for 2013–2016 according to the latest laws and regulations.

The Plan earnestly analyzes, in line with macro-economic situations at home and abroad, the Bank’s current

capital status and future capital requirements, establishes the principles and objectives for the Bank’s capital

management in 2013–2016, and clarifi es the major measures for capital management, so as to strengthen capital

management and promote business transition and upgrade, keep improving capital use effi ciency, balance the

relations of capital restriction, business development and risk prevention, and thus meet the needs of capital

supervision, business development and risk resistance in the future. Moreover, the Board of Directors reviewed

and approved the Proposal on Issuance of Eligible Tier-2 Capital Instruments with Write-down Feature in a

timely manner, with a view to further consolidating capital foundation, improving development sustainability and

guaranteeing the Bank’s continuous, smooth and healthy business development.

iii. Seize the historical opportunities to accelerate diverse and international operations

RMB internationalization, interest rate liberalization and the development of mobile internet technology bring

about not only challenges but also unprecedented opportunities to commercial banks. RMB internationalization

provides a signifi cant opportunity for the Bank to promote cross-border operation and become an internationally

— 16 —


leading bank; interest rate liberalization provides a signifi cant opportunity for the Bank to strengthen integrated

operation and structure adjustment; mobile internet technology provides a signifi cant opportunity for the Bank to

accelerate development and create greater glories. The Board of Directors draws up strategies in line with the

national strategy and industrial orientation and pays attention to business development. The Bank consolidated

the foundation of operation management and business development and expedited its diverse and international

operation by continuously exploiting new markets, creating new products, exploring new channels, attracting

new customers and probing into new mechanism.

iv. Assume social responsibilities and cultivate simple and clear corporate culture

The Board of Directors attaches importance to the performance of corporate social responsibilities, and joins

force with the Management to serve the development of real economy, provide considerate and reliable services,

instill green development dynamic, cultivate employees’ comprehensive development capability and continuously

repay shareholders and the society. The Bank always persists in the principle of being highly responsible for

shareholders, employees, customers and society, assumes social responsibilities on its own initiative, promotes

the development of science, education, culture, hygiene, sports, environmental protection, charity, public

benefi ts and various social undertakings by fi nancial force, obeys industrial competition order, improves fi nancial

services, protects legitimate rights and interests of consumers, and contributes to the social progress. The Board

of Directors pays attention to the cultivation of simple and clear corporate culture, in an effort to build healthier

enterprise environment, more effi cient dissemination mechanism, clearer framework for division of responsibility

and better repay shareholders and the society.

II. Continuously Improve Corporate Governance and Enhance Overall Governance

The Bank has been regarding improving shareholders’ value as its mission, and continuously pursuing excellent

corporate governance. In 2013, the Bank’s corporate governance was successively affi rmed by the capital markets

and all walks of life. It won many honors, including “Corporate Governance Excellence Award” of Hong Kong, “Top

10 Governance Companies” selected by the CCTV, the “Excellent Board of Directors” of “Golden Roundtable Award”

selected by the magazine of the Board of Directors, the “Excellent Board of Directors Award” and the “Gold Board

Secretary Award” selected by www.dongshiju.com, and the “Best Board Secretary Award” selected by www.stockstar.com.

i. Clarify functions and form a governance framework with well-defi ned responsibility and effective check and

balance

In 2013, all the members of the Board of Directors, the Board of Supervisors and the Senior Management actively

attended the shareholders’ meetings to fully communicate with shareholders and respond to the shareholders’

concerns. The Board of Directors established various communication channels to guarantee the right of every

shareholder to know, participate in and vote on major matters of the Bank, and ensure all shareholders are given

equal status. The Bank’s Independent Non-executive Directors fully heard the comments and suggestions of

the minority shareholders, expressed independent opinions, and faithfully performed their duties to protect the

interests of minority shareholders.

The Board of Directors could fully and earnestly implement various resolutions reviewed and approved by the

shareholders’ meetings to fully protect shareholders’ interests. In order to guarantee the scientifi c decision-

making and improve the discussion effi ciency of board meetings, the Board of Directors heard the Management’s

reports on proposals in advance by communication and preliminary communication meetings, so as to fully

understand the matters under deliberation and put forward its comments and suggestions. The Chairman

convened the communication meetings of Non-executive Directors to hear their suggestions on the business

development of the Bank and the work of the Senior Management, and further practice the recommended best

practices set forth in the Corporate Governance Code of the Hong Kong Stock Exchange.

— 17 —


In 2013, the Board of Directors further improved the supervision and restriction mechanism for the Senior

Management. It reviewed and approved the proposals such as the Performance Appraisal Results of the

Chairman, Executive Directors and Members of the Senior Management for 2012, the Performance Objectives

of the Chairman and the President for 2013 and the Plan on the Remunerations of the Chairman, Executive

Directors and Members of the Senior Management in 2012. The Senior Management earnestly implemented the

resolutions of the Board of Directors, carried out the follow-up matters of board meetings, and reported work

progress to the Board in time; the Senior Management earnestly implemented the requirements of the Board

of Directors on communicating major matters in advance, kept improving the mechanism for communication

and reporting before meetings of the Board of Directors and special committees. The Board continuously

strengthened its involvement in major matters.

The Board of Supervisors actively supervised the Board’s implementation of resolutions of shareholders’ general

meetings and the Senior Management’s implementation of resolutions of the Board, evaluated the performance

of duties and due diligence of the members of the Board of Directors and the Senior Management in an impartial

and fair manner, and effectively ensured the mechanism of “the general meeting of shareholders, the Board of

Directors, the Board of Supervisors and the senior management” brings its role into play.

ii. Improve system and continuously enhance corporate governance

The Board of Directors continuously improved corporate governance mechanism and effi ciency. According to

relevant regulatory requirements, the Bank timely amended the clauses relating to cash dividends in the Articles

of Association; the Bank studied the amendments to the Hong Kong Listing Rules and formulated the Bank of

China Limited Board Diversity Policy; the Bank revised the Collection of Rules and Regulations of Bank of China

on Corporate Governance to guarantee the smooth operation of the Board of Directors. The Bank established

scientifi c and sound corporate governance framework, improved effi cient and pragmatic corporate governance

mechanism, continuously deepened forward-looking exploration of corporate governance and kept improving

corporate governance, in a bid to better support the smooth operation and scientifi c decision-making of the

Board of Directors.

iii. Actively push forward the Group’s corporate governance improvement by training

The Bank takes improvement of the Group’s corporate governance and overall governance as an important

means to enhance its sustainable development capability. In 2013, the Bank invited regulatory authorities

and academic institutions to provide special trainings on such subjects as group management and corporate

governance of large banks to all subsidiaries, so as to maximize the Group’s synergy, make the best of the

Bank’s diversifi ed platform advantages, and ensure its corporate governance mechanism accommodates to its

diverse and international development needs, and the Bank’s overall strategy could be effectively implemented in

subsidiaries.

III. Improve Comprehensive Risk Management System and Strengthen Internal Control and External Audit

In 2013, the Board of Directors closely followed the economic situations and the Bank’s business development,

fully drew upon the external auditor’s suggestions, intensifi ed the development of risk management system and

kept improving internal control to ensure the Bank’s development strategies and business objectives could be fully

implemented and fulfi lled.

i. Deeply push forward the application of achievements in Basel II&III and improve overall risk management

The Board of Directors attached great importance to and actively pushed forward Basel II&III implementation,

and reviewed and approved the Report on Basel II&III Implementation Progress so as to strengthen application

of achievements in Basel II&III implementation and improve credit portfolio management plans. The Board

of Directors of the Bank, as a G-SIFI, reviewed and approved the Bank of China Group Recovery and

Response Plan (including response plan of institutions in the US) to enhance the Bank’s risk forewarning and

management capability, maintain the stability of fi nancial system and fully improve risk management and market

competitiveness.

— 18 —


ii. Improve risk management mechanism and comprehensive risk management

In order to meet the latest regulatory requirements and support and guarantee the Bank’s business development,

the Board of Directors reviewed and approved the proposals such as the Market Risk Limit (Level A) Application,

the Liquidity Risk Management Policy and the Risk Appetite Statement and Quantifi cation Plan of the Group, and

updated the Risk Appetite Statement of the Group. In 2013, the Bank, with sound liquidity management, took the

liquidity change in the capital market in stride, and won the acclaim of the regulators and the markets. In order to

improve approval effi ciency, the Board of Directors adjusted the approval authority of the Management without

prejudice to regulatory requirements, and meanwhile established the regular reporting system so as to help

the Board supervise and understand Management approval. The Bank continued to enhance non-performing

asset recovery and disposal, innovate in disposal modes, and improve disposal effi ciency and accountability

mechanism.

The Board of Directors attached importance to the balance between business development and risk

management and the publicity of risk management concept and culture throughout the Bank. While improving

systems and mechanisms, the Board accommodated to the situation change on its own initiative, strengthened

risk prevention for key areas and further improved the Group’s comprehensive risk management.

iii. Fully draw upon suggestions of the external auditor and continuously improve internal control system

In 2013, the Board of Directors actively assisted the regulators such as the CBRC and the National Audit Offi ce

in their audits of the Bank, fully drew upon suggestions put forward in the audit fi ndings, urged the Management

to actively rectify, and continuously improved internal control mechanism; the Board regularly heard the external

auditor’s report and management suggestions on the Bank’s internal control, supervised and evaluated the

external auditor’s services, promoted the improvement of external audit quality and continuously perfected

internal control system. Given that Bank of China is the most international commercial bank in China, the Board

of Directors attached importance to anti-money laundering, urged the Management to strengthen interaction

with the regulators and the public security organs, enhanced IT support for anti-money laundering, effectively

improved identifi cation effi ciency and prevented reputational risk. The Board also continuously consolidated

internal control foundation, perfected internal control measures and intensifi ed technical support to guarantee the

Bank’s healthy development and fulfi llment of strategic objectives.

iv. Improve connected transaction management mechanism and enhance connected transaction management

capability

The Board of Directors attached great importance to connected transaction management and changes in

supervisory rules, reviewed the Bank’s regulations on connected transaction management, and supervised their

implementation. The Board urged the Management to keep improving the completeness and effectiveness of the

Bank’s list of related parties, confi rm the list, review the Bank’s overall connected transaction conditions, pay

consistent attention to the building of connected transaction system and key transactions, and review information

disclosure matters concerning the Bank’s connected transactions. The Board of Directors continuously improved

the connected transaction management mechanism to effectively prevent and control connected transaction

risks and ensured the compliance of connected transactions.

— 19 —


IV. Strengthen Information Disclosure and Investor Relation Management and Continuously Improve Market

Image and Brand Value of the Bank

The Board of Directors attached great importance to information disclosure and investor relation management,

disclosed the Bank’s major decisions, operation management and business development to shareholders and the

capital markets, and kept improving the Bank’s transparency and reputation in the market. In 2013, the Bank’s investor

relations and information disclosure were continuously and widely recognized by the markets. The Bank was selected

into the top 100 listed companies in terms of IR in Greater China by the IR Magazine and “Top 100 Listed Companies

in Hong Kong in 2013” jointly by Tencent, Finet Group Limited and Hong Kong Economic Journal. The Bank won the

“Best Sustained Investment Value Award” and the “Investor Relation Gold Board Secretary Award” in the “Chinese

Securities” Investigation, and was successively listed into the “Annual Best 50 Listed Companies” by the Investor China

magazine and the “Top 100 Capital Brands of Chinese Listed Companies” selected by China Center for Market Value

Management. The Bank’s 2012 Annual Report won again the “Gold Award for A Comprehensive Appraisal of Annual

Report” of League of American Communications Professionals, and meanwhile was selected into the “Top 50 Annual

Report in China” and “Top 50 Annual Report in Asia Pacifi c”, and was awarded the “Silver Award of Report Preparation”

by the Annual Report Competition.

i. Deepen practice and continuously improve information disclosure mechanism

In 2013, the Board of Directors reviewed and approved the Management Measures on Responsibility

Investigation on Material Information Disclosure Errors of Regular Reports of Bank of China Limited (2013

Edition), continuously strengthened the standardization of working process and disclosure quality of regular

reports and improved the information disclosure system. In order to guarantee the interests of minority

shareholders, the members of the Board of Directors strictly conformed to and required the Management

to strictly implement the Rules Governing Persons with Knowledge of Inside Information of Bank of China

Limited and relevant regulations, hold inside information in strict confi dence, strengthen registration, fi ling and

management of insiders and eradicate insider trading. The Management was required to further carry out the

information disclosure person-in-charge responsibility system and information offi cer mechanism through the

Group, and hold information offi cer symposia and training; keep close watch on and timely follow up laws,

regulations and various requirements, amend information disclosure process, study information disclosure cases,

strengthen the initiative, planning and foresight of management, and further improve information disclosure

management capability and compliance.

ii. Continuously improve information disclosure in compliance with laws and regulations

In 2013, in order to promote the protection of investors’ interests, CSRC further strengthened supervision over

information disclosure of listed companies, and the securities regulator of Hong Kong continued to deepen the

supervision of inside information disclosure of listed companies. Under the guidance of the Board of Directors,

the Bank acted stringently and pragmatically in information disclosure, adhered to the bottom line of compliance,

and kept improving and deepening information disclosure management; the Bank prepared and disclosed regular

reports and various provisional reports truly, accurately, completely, timely and fairly, made information disclosure

more pertinent, effective and transparent, and effectively safeguarded investors’ rights to know. In 2013, the

Bank released 40 formal announcements in A share market and 85 announcements in H share market, so as to

truly, accurately, completely and timely disclose to capital markets and investors all the matters required by the

regulators.

— 20 —


iii. Strengthen investor relation management through effi cient interaction

The Board of Directors attached great importance to communication and contact with shareholders. The

Chairman participated in the results presentation in Hong Kong once he assumed offi ce, to answer the questions

that the media and institutional investors were concerned about. The Board of Directors urged the Management

to continuously improve the interaction and communication with the Bank and its shareholders. In 2013, the

Bank successfully completed the release and road show activities about annual, interim and quarterly results, and

timely and fully communicated with domestic and overseas investors by road shows, press conferences relating

to periodic results, company day activities and forums of large investors at home and abroad; continuously

improved the Bank’s web page of investor relations, and provided investors with richer information and more

convenient and rapid inquiry experience; continuously improved diverse communication channels, such as

investor hotline and email, timely and fully responded to investors’ questions by “SHSE e Interaction” internet

platform, and led the industry in terms of effectiveness and timeliness of response. Through effi cient interaction

with investors, the Board further improved the Bank’s brand value in the global capital market and provided

support and guarantee for the Bank’s operation and development.

iv. Innovate in mechanism and strengthen rating management

Protecting shareholders’ interests is a sacred mission of the Board of Directors. In 2013, the Board of Directors

urged the Management to continue strengthening study of capital market and rating management of the Group,

improving the pertinence, timeliness and professionalism of rating communications, and conducting multi-

level communications with rating agencies on the Bank’s risk management progress, liquidity management

status, operating results and development strategies. In 2013, the Bank’s credit rating was further upgraded

by Standard & Poor’s, and unchanged by Moody’s, Fitch Ratings and other major rating agencies. In 2013, the

Bank outperformed major peers in terms of market capitalization.

V. Scientifi cally Perform Duties and Establish a Sound and Effi cient Board of Directors

In 2013, the Board of Directors further enhanced the planning of meeting organizations and executive force of meeting

plans. All Directors could strictly observe laws, regulations and Articles of Association and guard the Bank’s business

secret, and diligently and faithfully perform their duties; attend meetings in time and express their opinions and

suggestions actively; safeguard interests of the Bank and its shareholders, accept supervision of all shareholders, the

Board of Supervisors and external regulators consciously, and show high sense of responsibility and professionalism.

i. Timely complete change of Directors and guarantee the continuity and stability of the Board of Directors

In 2013, the Bank timely and effi ciently completed corporate governance procedures, such as the change

of Directors, appointment of Independent Directors and adjustment of chairmen and members of the special

committees of the Board of Directors in accordance with laws, regulations and the Articles of Association. The

work of the newly appointed Independent Directors is led and promoted by the Independent Director who acts

as the chairman of the Personnel and Remuneration Committee. The existing Independent Directors recommend

Independent Director candidates to the Board of Directors by holding a selection and appointment meeting

attended by all Independent Directors. At present, Independent Directors respectively chair the Audit Committee,

the Risk Policy Committee, the Personnel and Remuneration Committee and the Connected Transaction Control

Committee of the Board of Directors. Furthermore, the Board of Directors reviewed and approved the Bank of

China Limited Board Diversity Policy, providing better guarantee for maintaining the Bank’s sound corporate

governance, achieving sustainable development and achieving strategic objectives.

— 21 —


ii. Directors faithfully and diligently perform duties and continuously enhance capability of performing duties

When the Board of Directors was not in session, Directors made surveys in a cost-effective manner in typical

domestic and overseas branches for 33 person-times with focus on cross-border RMB, local government

fi nancing vehicles, endogenous dynamic mechanism, SME business development and other topics that the

Board was concerned about, according to the work needs of the Board and the annual survey plan. The survey

achievements were timely fed back to the Management in the form of survey report. The diligent surveys of

Directors deepened the Board’s understanding of strategy implementation, enhanced communications between

the Board and the Management and energetically supported the Board’s scientifi c decisions.

In order to further improve capability of performing duties and making decisions, all Directors actively participated

in the training courses organized by the regulators and the Bank for 88 person-times. According to the regulatory

requirements, the Directors actively participated in the training courses on systemically important banks and

capital supervision, capital market and monetary policy and asset securitization organized by CBRC and CSRC

Beijing Bureau; in keeping with macro development changes and amendments to laws and regulations, the Bank

organized the training relating to the economic outlook and banking development under the leadership of the

new administration, present situation and future of corporate governance of large banks, disclosure of inside

information and recent development of listing rules; in 2013, when newly appointed Directors just held offi ce, they

heard various Management reports on organization setup, overseas business development and risk management

of the Bank. The Directors also improved their professionalism, competence and capability of performing duties

and making decisions by writing and publishing professional articles and works, attending forums and symposia

and giving lectures publicly.

As required by CBRC and the Board of Supervisors of the Bank, the Board of Directors earnestly summarized the

performance of duties in 2013, timely submitted duty performance reports, actively accepted supervision by all

shareholders, the Board of Supervisors and external regulators and further enhanced its capability of performing

duties scientifi cally.

iii. Give play to the role of special committees of the Board of Directors and support the Board’s scientifi c and

effi cient decision-making

In 2013, all special committees of the Board of Directors made use of their professional advantages, earnestly

performed duties and held a total of 25 meetings on strategic development, internal control, Group risks,

information on related parties and other matters that the Board of Directors was concerned about, within the

scope of authority delegated by the Board of Directors, the Articles of Association and related rules of procedure

of the Bank. All special committees fully streamlined working process, formulated working standards, further

enhanced their support for the Board of Directors and improved the Board’s decision-making effi ciency.

The year 2014 marks a new route for China’s deepened reform, but there remain multiple uncertainties in

macroeconomic environment. The banking industry is facing signifi cant opportunities and severe challenges.

The Board of Directors will serve the national strategy in line with its historical mission, and further improve

governance and make scientifi c decisions according to the regulatory requirements of the places where the

Bank was listed. The Bank will continue reform and innovation, improve services and achieve sound operation.

The Bank will strive to assume signifi cant responsibility in the national rejuvenation, possess leading position in

globalization, lead the lifestyle in technical renovation and win customers in market competition. The Bank will

satisfy shareholders, employees and the society in sustained development, and spare no efforts to attain the

strategic objective of “assuming social responsibility and becoming the best bank”.

Board of Directors of Bank of China Limited

— 22 —

ATTACHMENT B 2013 WORK REPORT OF THE BOARD OF SUPERVISORS

2013 WORK REPORT OF THE BOARD OF SUPERVISORS

Meetings of the Board of Supervisors

In 2013, the Bank convened six on-site meetings of the Board of Supervisors on 30 January, 26 March, 25 April, 29 August,

25 September and 30 October, respectively, and one meeting of the Board of Supervisors via written resolutions. At these

meetings, the Board of Supervisors reviewed and approved 20 proposals on the Bank’s periodic reports, 2012 profi t

distribution plan, 2012 internal control self-assessment report, 2012 work report of the Board of Supervisors, 2013 work plan

of the Board of Supervisors, evaluation opinions on the duty performance of Directors and senior management members for

2012, and nomination of candidates for Supervisors of the Bank etc.

In 2013, the attendance rate of each Supervisor of the meetings of the Board of Supervisors is given below:

SupervisorNumber of meetings attended/Number of

meetings convened during term of offi ce

Li Jun 7/7

Wang Xueqiang 7/7

Liu Wanming 7/7

Deng Zhiying 7/7

Liu Xiaozhong 7/7

Xiang Xi 7/7

Mei Xingbao 5/7

Bao Guoming 7/7

In 2013, the Duty Performance and Due Diligence Supervision Committee of the Board of Supervisors held one meeting,

at which it reviewed and approved the proposal on evaluation opinions on the duty performance of Directors and senior

management members for 2012, as well as other proposals. The Finance and Internal Control Supervision Committee of

the Board of Supervisors held four meetings, at which it reviewed and approved the Bank’s periodic reports, 2012 profi t

distribution plan, 2012 internal control self-assessment report and other proposals.

Performance of Supervision and Inspection by the Board of Supervisors

In 2013, focusing on the central tasks of the Bank, the Board of Supervisors fully implemented regulatory requirements,

emphasised the Bank’s working priorities and pursued practical results. It earnestly carried out the supervision of duty

performance, fi nances, internal controls and risk management, pushed forward the planning and implementation of major

decisions and continuously enhanced the effi ciency of its supervision of the Bank’s corporate governance, strategy

implementation, operational management, risk management and internal control, so as to safeguard the interests of

shareholders and the Bank.

Carry out supervision and evaluation on the duty performance of Directors, Supervisors and senior management members.

The Board of Supervisors attended meetings of the Board of Directors, special committees and the senior management

as non-voting attendees and supervised the compliance level of major decision-making processes in line with regulatory

guidelines and requirements. By collecting, sorting and analysing important information including meetings, keynote

speeches, instructions and the meeting minutes of Directors and senior management members on a monthly basis, the Board

of Supervisors maintained an in-depth understanding of how major matters are being implemented across the Bank, including

the Bank’s development strategy, business plan, capital and risk management and internal audit. It also strengthened the

supervision of the duty performance process of Directors and senior management members. In addition, the Board of

Supervisors formulated an annual evaluation plan for duty performance and diligently organised annual duty performance

interviews with Directors and senior management members. It also exchanged views on the progress and effectiveness of

— 23 —


major tasks as well as on relevant opinions and recommendations, objectively and fairly evaluated the duty performance of the

Board of Directors, senior management and their members, and developed annual evaluation opinions on duty performance,

so as to urge Directors and senior management members to perform their duties with diligence. According to the supervisory

requirement, the Board of Supervisors reviewed and formulated the 2013 assessment result on the performance of duties

of the Directors, Supervisors and senior management members of the Bank that the Directors, Supervisors and senior

management members were competent.

Increase the pertinence and accuracy of fi nancial, internal controls and risk management supervision. The Board of

Supervisors collected information on the fi nances, risks and internal controls of the Bank and other banks by attending

meetings of the Board of Directors, special committees and the Executive Committee and other means and analysed the

information on a monthly basis. It carried out more targeted supervision of the Bank’s fi nances, risks, and internal controls by

strengthening comprehensive and forward-looking judgment and focusing on key issues.

First, it enhanced supervision of material fi nancial matters. The Board of Supervisors held four special meetings with relevant

departments of the Head Offi ce with regard to the compilation, review and disclosure of the periodic fi nancial reports. It also

heard reports on fi nancial report compilation, material fi nancial matters, mechanisms building for risk assets variations and

risk management, and reports on major internal audit fi ndings, paying special attention to the implementation of 2013 annual

business plan and fi nancial budget, the applicability and accuracy of accounting policies, legality and compliance of major

fi nancial decisions and effectiveness of risk management and internal controls. The relevant department actively responded to

opinions and suggestions put forward in a timely manner by the Board of Supervisors and made continuous improvements.

Second, it reinforced supervision on external audit quality. As there were changes in the external auditors of the Bank, the

Board of Supervisors enhanced communications with auditors and urged them to become familiar with the Bank’s operation

and fi nancial position as soon as possible. It heard audit plans and reports on audit opinions on three occasions, and required

external auditors to further improve audit quality and make more valuable audit suggestions.

Third, it introduced further supervision of internal controls and risk management. To effectively carry out supervision of internal

controls, the Board of Supervisors regularly summarized and analysed supervision opinions, major problems found in internal

and external audits and corrective actions taken, followed up the compliance of CARPAL indicators, and constantly tracked

the progress and effectiveness of key risk management and internal control tasks. The Board of Supervisors also paid close

attention to the dynamics of industrial and regional credit risks such as those in overcapacity industries, real estate, and

local government fi nancing vehicles, as well as interbank business, liquidity risks and IT progress. In addition, it reminded

and urged the senior management to step up response and prevention measures, with the underlying aim of “no systemic or

regional risk occurred”.

Carry out special surveys on core issues and actively provide constructive recommendations. The Board of Supervisors

continued to conduct special surveys as an important means of its duty performance. Its survey team visited 22 domestic

and overseas branches and subsidiaries to carry out research on important operational management issues at the basic

level based on actual conditions. Supervisors actively provided pertinent opinions and suggestions in the meetings of the

Board of Directors and the senior management based on the survey results, making helpful references to better decisions

and implementations. In response to the opportunities and challenges brought about by RMB internationalisation, interest

rate liberalisation and the spread of mobile Internet, the Board of Supervisors brought its strengths into play to support the

strategic goal of “serving society, delivering excellence”. It focused on the key issues of improving outlet effi ciency, developing

internal dynamics and improving management of the Bank’s wealth management business. It learnt comprehensively about

actual frontline conditions by carrying out special surveys on departments of the Head Offi ce, branches and subsidiaries,

extensively collected the wisdom and demands of all stakeholders, thus enhancing the scope and intensity of its supervision

activities. The Board of Supervisors ensured a timely exchange of views with relevant departments and branches regarding

prominent problems identifi ed in surveys, submitted survey reports and supervision proposals to the senior management, and

helped to refi ne policies and measures and develop approaches to improvement so as to build an excellent bank.

— 24 —


Implement regulatory guidance to strengthen self-building. The CBRC issued the Guidance on the Work of the Board

of Supervisors of Commercial Banks and the Guidance on Corporate Governance of Commercial Banks, specifying the

direction and route of corporate governance for commercial banks and providing guidelines for the work of the Board of

Supervisors. The Board of Supervisors paid close attention to the guidelines and steadily implemented them through various

measures, which includes: formulating measures for implementing supervision on fi nances and internal controls, and revising

measures for the duty performance evaluation of Directors and senior management members as well as working rules of

special committees; adjusting the terms of services of Supervisors, including electing three shareholder Supervisors and

one employee Supervisor; carrying out annual evaluation of Supervisors after formulating measures for evaluating their duty

performance, and improving incentive and restraint mechanisms; holding trainings sessions with special surveys as case

studies, concerning Supervisors’ duty performance, and arranging for Supervisors to attend CBRC’s training sessions for

directors and supervisors of large banks, so as to enhance the quality and capability of duty performance; organising and

participating in the 2013 seminar for boards of supervisors of controlling and participating banks hosted by Huijin reaching

broad consensus and achieving positive results by exchanging views with substantial shareholders, regulators and peers’

boards of supervisors on how to fully play the rule of board of supervisors under new circumstances and how to actively

prevent systematic risks. The Offi ce of Board of Supervisors also gave full play to its role of consultancy and service

guarantee, and further improved its working effi ciency and executive capability.

The work of the Board of Supervisors was well recognised and supported by the Board of Directors and the senior

management in 2013. The Board of Supervisors fully realised its role as an effective check and balance within the Bank’s

structure, which further enhanced the Bank’s corporate governance capacity.

During the reporting period, the Board of Supervisors held no objections to such matters under its supervision as the

Bank’s operational and legal compliance, fi nancial position, use of capital raised, purchase and sale of assets, connected

transactions and internal controls.

Board of Supervisors of Bank of China Limited

— 25 —

ATTACHMENT C 2013 ANNUAL FINANCIAL STATEMENTS

The statements below are prepared in accordance with the International Financial Reporting Standards.

Note: All of the below statements are excerpted from the audited financial statements of the Group for the year 2013

prepared in accordance with the International Financial Reporting Standards. The complete 2013 audited financial statements

are available on the Bank’s website at www.boc.cn and the website of Hong Kong Exchanges and Clearing Limited at

www.hkexnews.hk.

CONSOLIDATED INCOME STATEMENT

For the year ended 31 December 2013 (Amount in millions of Renminbi, unless otherwise stated)

2013 2012

(Restated)

Interest income 518,995 506,528

Interest expense (235,410) (249,564)

Net interest income 283,585 256,964

Fee and commission income 88,585 75,198

Fee and commission expense (6,493) (5,275)

Net fee and commission income 82,092 69,923

Net trading gains 7,183 8,451

Net gains on investment securities 594 2,288

Other operating income 34,055 28,550

Operating income 407,509 366,176

Operating expenses (172,314) (159,729)

Impairment losses on assets (23,510) (19,387)

Operating profi t 211,685 187,060

Share of results of associates and joint ventures 1,092 613

Profi t before income tax 212,777 187,673

Income tax expense (49,036) (41,927)

Profi t for the year 163,741 145,746

Attributable to:

Equity holders of the Bank 156,911 139,656

Non-controlling interests 6,830 6,090

163,741 145,746

Earnings per share for profi t attributable to equity holders of the Bank during the year

(Expressed in RMB per ordinary share)

— Basic 0.56 0.50

— Diluted 0.54 0.48

— 26 —


CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2013 (Amount in millions of Renminbi, unless otherwise stated)

As at 31 December

2013 2012

ASSETS

Cash and due from banks and other fi nancial institutions 702,584 775,574Balances with central banks 2,132,001 1,934,297Placements with and loans to banks and other fi nancial institutions 660,049 447,299Government certifi cates of indebtedness for bank notes issued 82,069 70,554Precious metals 193,208 150,534Financial assets at fair value through profi t or loss 75,200 71,590Derivative fi nancial assets 40,823 40,188Loans and advances to customers, net 7,439,742 6,710,040Investment securities 2,181,270 2,138,934 — available for sale 701,196 686,400 — held to maturity 1,210,531 1,183,080 — loans and receivables 269,543 269,454Investment in associates and joint ventures 13,368 12,382Property and equipment 158,968 150,324Investment properties 20,271 17,142Deferred income tax assets 22,928 21,292Other assets 151,818 140,465

Total assets 13,874,299 12,680,615

LIABILITIES

Due to banks and other fi nancial institutions 1,551,624 1,553,192Due to central banks 200,939 130,022Bank notes in circulation 82,212 70,733Placements from banks and other fi nancial institutions 339,265 313,004Derivative fi nancial liabilities 36,212 32,457Due to customers 10,097,786 9,173,995 — at amortised cost 9,941,288 9,009,978 — at fair value 156,498 164,017Bonds issued 224,704 199,133Other borrowings 29,570 34,045Current tax liabilities 40,031 34,994Retirement benefi t obligations 4,815 5,642Deferred income tax liabilities 3,385 3,838Other liabilities 302,279 268,018

Total liabilities 12,912,822 11,819,073

EQUITY

Capital and reserves attributable to equity holders of the BankShare capital 279,365 279,147Capital reserve 116,121 115,451Treasury shares (28) (15)Statutory reserves 80,225 65,362General and regulatory reserves 144,450 131,909Undistributed profi ts 323,673 242,899Reserve for fair value changes of available for sale securities 1,652 7,276Currency translation differences (21,542) (17,352)

923,916 824,677

Non-controlling interests 37,561 36,865

Total equity 961,477 861,542

Total equity and liabilities 13,874,299 12,680,615

— 27 —


CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2013 (Amount in millions of Renminbi, unless otherwise stated)

Attributable to equity holders of the Bank

Share capital

Capital reserve

Statutory reserves

General and regulatory

reservesUndistributed

profi ts

Reserve for fair value

changes of available for

sale securities

Currency translation differences

Treasury shares

Non-controlling

interests Total

As at 1 January 2013 279,147 115,451 65,362 131,909 242,899 7,276 (17,352) (15) 36,865 861,542

Profi t for the year — — — — 156,911 — — — 6,830 163,741Other comprehensive income — 285 — — 121 (5,624) (4,190) — (2,407) (11,815)

Total comprehensive income for the year — 285 — — 157,032 (5,624) (4,190) — 4,423 151,926

Conversion of convertible bonds 218 449 — — — — — — — 667Appropriation to statutory reserves — — 14,863 — (14,863) — — — — —Appropriation to general and regulatory reserves — — — 12,545 (12,545) — — — — —Dividends — — — — (48,851) — — — (3,908) (52,759)Net change in treasury shares — — — — — — — (13) — (13)Capital injection by non-controlling shareholders — — — — — — — — 181 181Equity component of convertible bonds — (64) — — — — — — — (64)Other — — — (4) 1 — — — — (3)

As at 31 December 2013 279,365 116,121 80,225 144,450 323,673 1,652 (21,542) (28) 37,561 961,477

Attributable to equity holders of the Bank

Share capital

Capital reserve

Statutory reserves

General and regulatory

reservesUndistributed

profi ts

Reserve for fair value

changes of available for

sale securities

Currency translation differences

Treasury shares

Non-controlling

interests Total

As at 1 January 2012 279,147 115,403 52,165 81,243 210,599 3,642 (18,260) (25) 33,223 757,137

Profi t for the year as restated — — — — 139,656 — — — 6,090 145,746Other comprehensive income as restated — 47 — — (224) 3,634 908 — 1,115 5,480

Total comprehensive income for the year — 47 — — 139,432 3,634 908 — 7,205 151,226

Appropriation to statutory reserves — — 13,187 — (13,187) — — — — —Appropriation to general and regulatory reserves — — — 50,667 (50,667) — — — — —Dividends — — — — (43,268) — — — (3,571) (46,839)Exercise of subsidiary share options — — — — — — — — 2 2Net change in treasury shares — — — — — — — 10 — 10Capital injection by non-controlling shareholders — — — — — — — — 6 6Other — 1 10 (1) (10) — — — — —

As at 31 December 2012 279,147 115,451 65,362 131,909 242,899 7,276 (17,352) (15) 36,865 861,542

— 28 —

ATTACHMENT D CAPITAL MANAGEMENT PLAN OF BANK OF CHINA FOR 2013–2016

CAPITAL MANAGEMENT PLAN OF BANK OF CHINA FOR 2013–2016

For the purpose of implementing strategic planning requirements, further enhancing capital management, maintaining a

reasonable size and quality of capital, supporting sustainable and healthy development of the Group’s businesses and

meeting requirements of return to shareholders, this Plan is formulated in accordance with the Regulation Governing Capital

of Commercial Banks (Provisional) (the “Capital Regulation”) issued by CBRC and other relevant regulations.

I. Capital Management Principles

i. Adequate capital and sustainable development. With in-depth implementation of the scientifi c outlook on

development and focus on the requirements of the Group’s development strategy planning, high capital quality

and suffi cient capital level will be maintained all along, to meet regulatory requirements, support business

development, and facilitate the healthy, coordinated and sustainable development of the whole bank’s business

in terms of scale, quality and benefi ts.

ii. Optimize capital allocation and increase benefi ts. Based on reasonable capital allocation, priorities will be given

to the asset business with low capital occupation and high comprehensive income, so as to steadily improve

capital use effi ciency and return on capital, and achieve mutual matching and dynamic balance of risk, capital

and benefi ts.

iii. Meticulous management and enhance capital level. The capital management system will be improved to identify,

measure, monitor, mitigate and control various major risks in a suffi cient manner. Capital constraints will be

penetrated into the process of operation and management including product pricing, resource allocation,

structural adjustment and performance appraisal, to ensure that capital level can match exposed risks and risk

management level.

II. Capital Management Targets

i. Capital measurement methods and adjustments

According to the Capital Regulation and relevant supporting policies, CBRC will allow a parallel period for

commercial banks approved to adopt the advanced measurement approach (AMA). The parallel period will begin

at the end of the year upon approval for AMA and last for at least three years. Currently, Bank of China is working

with CBRC in pushing assessment of the New Basel Capital Accord application and implementation, with the

parallel period to be eventually determined and adjusted according to the status of AMA approval.

Bank of China will strictly follow regulatory requirements on capital bottom line set forth in the Capital Regulation

and relevant supporting policies. In the parallel period, capital adequacy ratio (CAR) will be measured using the

approved AMA and other approaches in parallel, and the capital bottom line will be adjusted. The capital bottom

line adjustment coeffi cient is 95%, 90% and 80% for the fi rst, second and third years respectively. After three-

year parallel period, capital bottom line adjustments will be continuously pursuant to regulatory requirements.

ii. CAR management targets

Based on overall consideration of various factors such as meeting regulatory requirements, supporting business

development, preventing operational risk and current capital adequacy status, major capital management targets

for 2013–2016 are set from a proactive and conservative perspective as follows: the Group’s core tier-one CAR,

tier-one CAR and total CAR are no less than 8.5%, 9.5% and 11.5%, respectively.

— 29 —


III. Capital Accumulation and Replenishment

To ensure the achievement of the above-mentioned capital management targets, Bank of China will, based on the

principle of “focusing on internal capital accumulation, supplemented by external capital replenishment”, raise capital

through multiple channels and methods and make efforts to maintain adequate capital.

i. Enhance profi tability. Internal capital accumulation is essentially the process of improving the ability to create

profi t. In 2013–2016, Bank of China will insist on the capital growth method with the focus on endogenous

replenishment, put effort to optimize business and income structure, effectively control costs and expenditures

and keep raising the Group’s return on capital. By means of reasonable retained profi t, capital structure and

quality will be further improved, and the capability of internal capital accumulation will be strengthened, to further

boost the continuous growth of capital replenishment sources.

ii. Reasonably distribute dividends. Retained profi t is the principal source of internal capital accumulation. In

2013–2016, Bank of China will apply the reasonable profi t distribution policy based on the precondition of

maintaining steady growth of profi tability, determine cash dividend ratio on a rational basis, and guarantee the

stable growth of dividends. In the meantime, endogenous capital accumulation will be effectively enhanced by

means of appropriate retained profi t.

iii. Tap deep into internal potential. Optimization of asset structure is an important way to economize capital

occupation. In 2013–2016, Bank of China will continue to strengthen the idea of capital saving, give overall

consideration to the existing and newly increased assets, energetically adjust and optimize asset structure,

accelerate light-capital business development, and link it to resource allocation, so as to improve input-output

effi ciency and effectively save capital occupation.

iv. Carry out external fi nancing activities. After the Capital Regulation is implemented, the defi nition of capital will be

stricter and regulatory standards for capital instruments will be further heightened. To facilitate fi nancial product

innovation in China, diversify fi nancial market investment products and expand capital funding channels, the Bank

will move ahead actively with issuing innovative capital instruments.

IV. Main Capital Management Measures

i. Intensify capital budget and optimize capital allocation

The comprehensive capital budget management will be applied continuously, and appraisal and utilization of

economic capital indicators will be intensifi ed. By means of the construction of endogenous capital dynamics

mechanism, reasonable allocation of capital resources, and improving the allocation method of tying capital use

to institution’s return, all operating institutions will be guided to intensify the development concept of capital

constraints and take proactive measures to advance effi ciency of capital use, expand contribution to profi t and

enhance return on capital of the Group.

ii. Accelerate structural adjustment and save capital

Focusing on both stock and increment, the adjustment and optimization of asset structure will be intensifi ed,

capital-light business will be developed energetically, and capital use effi ciency will be raised. Loan restructuring

will be accelerated to moderately increase lending to micro, small and medium-sized enterprises. Credit

resources will be reasonably allocated to increase the overall yield level of customers. The size of assets with high

risk weights will be strictly controlled and capital-light fee-based businesses will be developed. Emphasis will be

placed on risk mitigation by guarantee and collateral at the credit granting stage, so as to increase coverage ratio

of risk mitigation and reduce average risk weight.

— 30 —


iii. Propel system construction and cement managerial foundation

The development of EVA and RAROC measurement and analysis system will be accelerated to keep improving

accounting system (based on customers and products) and data base, and achieve RAROC and EVA

measurement and analysis in terms of product, customer and institution. The construction and implementation

of capital management system will be expedited to integrate fi nancial information, business information and

risk information, realize management functions covering capital planning, budgeting, allocation, monitoring and

appraisal, and make capital management more automatic and meticulous.

iv. Improve stress test and establish emergency mechanism

Pursuant to regulatory rules, a stress test system for capital adequacy ratio will be established and improved to

estimate capital demands and availability under stress conditions and ensure that adequate capital is available to

cope with adverse changes in market conditions. An emergency capital replenishment mechanism will be built,

so that unplanned capital demands can be met and capital management targets can be achieved by means of

policy measures such as suspension of high capital-consuming business, restriction on dividend distribution,

write-down of capital instruments or conversion to shares, under severely deteriorated external operating

environment or other extremely adverse circumstances.

v. Strengthen trainings and reinforce capital transfer

New thoughts, methods and means on capital-intensive development will be studied in an in-depth manner

under new regulatory rules. The concepts, means and measures on capital management can be transmitted to

business lines, branches and grass roots, so that capital constraints will be effectively integrated into day-to-day

operation and management. As the transition from previous regulatory rules to new ones presents the features

of wide coverage and complicated contents, systematic staff trainings will be increased to arouse more attention

and raise cognition of the whole bank, and regulatory capital requirements will be effi ciently combined with

internal capital management.

— 31 —

APPENDIX II 2013 REPORT ON CONNECTED TRANSACTIONS

2013 REPORT ON CONNECTED TRANSACTIONS

In 2013, the Bank continued implementing laws, regulations and regulatory provisions, improved the connected transaction

management system, optimized the IT system connected transaction monitoring, implemented process and delicacy

management of connected transactions, and made every effort to improve connected transaction management. Pursuant

to the Administrative Measures for Connected Transactions between Commercial Banks and Their Insiders or Shareholders

published by CBRC and the Special Provisions Concerning Information Disclosure of Commercial Banks published by CSRC,

we are hereby reporting the information on the connected transactions of the Bank in 2013 as follows:

I. Work of the Connected Transactions Control Committee

The Connected Transactions Control Committee held three meetings in 2013, in which the committee mainly reviewed

and approved the report on the confi rmation of connected parties list of the Bank and the Schedule of Connected

Transactions Control Committee Meetings in 2014. The committee also reviewed the special report of funds provided

to major shareholders and related parties, the Statement of the Bank’s Connected Transactions in 2012, and the report

on the Implementation Rules for the Management of Connected Party Transactions of Bank of China Limited (2013

Version).

During the reporting period, the committee paid constant attention to issues such as the IT system of Connected

Transactions, transactions with key connected parties. The committee members offered important opinions and

recommendations regarding the IT system constructions and data report of the connected transactions, etc.

II. Connected Transaction Management

i. Issued implementation rules of connected transaction management to further improve the connected transaction

policy framework

The Bank formulated the Implementation Rules for the Management of Connected Transaction of Bank of

China Limited (the “Implementation Rules”) after amending the Management Procedure for the Management

of Connected Transaction of Bank of China Limited (the “Management Procedure”) in an all-round manner

in 2012, to carry out the requirements set by the Management Procedure, instruct the connected transaction

management in daily work and promote connected transaction management effi ciently and orderly.

The Implementation Rules refl ects the management requirements under different regulatory rules, specifi es the

concrete scope and requirements for connected parties under different regulatory standards, and specifi es the

standard, requirements and contents relating to the approval and disclosure of connected transactions. At the

same time, the document elaborates the management process and requirements for connected parties and

connected transactions, mainly including real-time and regular update of connected parties, collection, use and

publishing of the connected party list, identifi cation and pricing of connected transactions, and review and fi ling of

connected transactions.

— 32 —


ii. Optimized the connected transaction monitoring system to improve the technical level of connected transaction

management

After deploying the connected transaction monitoring system in 2012, the Bank further optimized the system,

expanded the scope of automatic collection of connected transaction data, realized automatic collection of

treasury transactions which is a major concern of connected transaction monitoring, and further optimized the

functions of the system.

The launch and continuous optimization of the system have lifted the technical level of connected transaction

management in an all-round manner. As to connected party management, the system has integrated and

optimized the functions of the original connected party list base and the connected party retrieval system,

and realized the real-time update of connected customer information in the core banking system; and as to

connected transaction monitoring, the system has realized the automatic data collection in major business

areas, automatic aggregation of all system data within a 12 months period (including both automatically

collected and manually entered data) and realized the function of alert, online review of connected transactions,

multidimensional statistics, etc.

iii. Optimized connected party management to lay a solid foundation for connected transaction management

The Bank combines real-time update and annual update during connected party management. The functional

departments relating to connected party management deal with reporting, input and daily management of

connected parties in the sphere of respective responsibilities, and conduct annual update of connected parties

on this basis.

To further improve the timeliness and effectiveness of connected party information, the Bank actively optimized

the connected party management mechanism, urged the functional departments undertaking connected party

management to conduct real-time update of connected parties, actively collect connected customer information

and enter such information into the connected transaction monitoring system so as to ensure the consistence

between the certifi cate information of the connected parties in the system and the information submitted at

account opening and realize effective collection of connected transaction data.

iv. Strengthened daily monitoring of connected transactions to ensure compliance

In order to promote process management and delicacy management of daily connected transaction monitoring,

the Bank distributed the Notice on the Working Arrangement for Connected Transaction Management in 2013

at the beginning of last year, which further specifi ed the requirements and standard for connected transaction

monitoring that should be observed by the connected transaction management departments and functional

management departments. The bank updated the regulatory ratio regularly, which defi ned the standard for

approval and disclosure of connected transactions by the Board of Directors and the General Meeting of

Shareholders, and performed the insignifi cant subsidiaries testing, which specifi ed the scope of connected

parties applicable to exemption on the insignifi cant subsidiaries level.

The Bank identifi ed connected transactions, conducted both single transaction monitoring and continuous

monitoring, reported, reviewed and manually input connected transactions strictly according to the Management

Procedures and the Implementation Rules. The Bank satisfi ed the requirements of external laws, regulations

and supervisory provisions for connected transaction pricing, prohibition of special connected transactions, and

approval and disclosure of connected transactions.

To conclude, in 2013, the connected transaction management mechanisms of the Bank functioned stably and

connected transactions operated standardly and thus ensured the compliance of the connected transactions of

the group.

— 33 —


III. Connected Transactions

i. Connected parties

As at 31 December 2013, the Bank had a total of 5,331 connected parties, including 1,806 connected legal

persons, rising by 110 compared with the same period of 2012 and accounting for 34% of all the connected

parties and 3,525 connected natural persons, rising by 209 compared with the same period of 2012 and

accounting for 66% of all the connected parties. In particular, there were 881 connected parties under the CBRC

rules, 257 ones under the Listing Rules of the Shanghai Stock Exchange and 4,694 ones under the Hong Kong

Listing Rules.

ii. Connected transactions under CBRC rules

In 2013, the Bank had no signifi cant connected transactions, and had no connected transactions of asset

transfer and rendering of services.

As to credit transactions, as at 31 December 2013, the net credit balance of the Bank with connected parties

totaled RMB104,498,600, representing 0.0089% of the Bank’s net capital, and the net credit balance with the

largest connected party was RMB10,721,300, representing 0.0009% of the Bank’s net capital. The Bank priced

the credit transactions with these connected parties with the market price applicable to comparable independent

third parties, and the credit transactions were all normal loans. As at 31 December 2013, the Bank’s credit

balance with the connected parties accounted for 0.0014% of the Bank’s total credit balance.

iii. Connected transactions under the Listing Rules of Shanghai Stock Exchange

In 2013, the Bank had no connected transactions that shall be disclosed timely and submitted to the Board of

Directors and the shareholders’ meeting for review. As at 31 December 2013, the loan balance of the Bank with

the connected natural persons came at RMB16,355,600.

iv. Connected transactions under the Hong Kong Listing Rules

Pursuant to the Hong Kong Listing Rules, any transaction between the Bank and a connected party (as defi ned

in the Hong Kong Listing Rules) shall constitute a connected transaction of the Bank. Such transaction shall

be supervised and managed in line with the Hong Kong Listing Rules. In 2013, the Bank conducted a series

of connected relations with the connected parties during the daily business, and all these transactions can

be exempted from the requirement for reporting, annual review, announcement and approval by independent

shareholders pursuant to Articles 14A.31 or 14A.33 of the Hong Kong Listing Rules.

— 34 —

APPENDIX III 2013 DUTY REPORT OF INDEPENDENT DIRECTORS

2013 DUTY REPORT OF INDEPENDENT DIRECTORS

In accordance with relevant provisions and requirements of the Company Law, the Guidelines for Introducing Independent

Directors to the Board of Directors of Listed Companies, the Corporate Governance Code of the Hong Kong Stock

Exchange as well as other laws and regulations applicable to the Bank, the Articles of Association and the Work Rules

of the Independent Directors of Bank of China Limited and the inherent requirements of sound corporate governance on

Independent Directors the Independent Directors discharged their duties with care and diligence, played an active role in

protecting the legitimate rights and interests of the Bank and its shareholders, including minority shareholders, promoted

the implementation of strategic development plans and contributed to the Bank’s development in 2013. The 2013 duty

performance report of Independent Directors is reported as follows:

I. Basic Information of Independent Directors

The Board of Directors of the Bank is rationally structured and diversifi ed. Currently, the Board of Directors comprises

thirteen members. Besides the Chairman, there are two Executive Directors, fi ve Non-executive Directors and fi ve

Independent Directors. The number of Independent Directors exceeds one-third of the total number of Directors.

The number of Directors complies with the quorum requirement specifi ed in the Articles of Association and relevant

regulatory requirements. The Independent Directors serve as the Chairmen of the Audit Committee, Risk Policy

Committee, Personnel and Remuneration Committee and Connected Transactions Control Committee, respectively.

Major working experiences, professional backgrounds, and full-time or part-time employment by other institutions of

Independent Directors are as follows:

Chow Man Yiu, Paul, Independent Director of the Bank since October 2010. Mr. Chow was an executive director

and Chief Executive of Hong Kong Exchanges and Clearing Limited from April 2003 to January 2010. Hong Kong

Exchanges and Clearing Limited is listed on the Main Board of The Stock Exchange of Hong Kong Limited. Mr. Chow

currently serves as the Chairman of Hong Kong Cyberport Management Company Limited and an independent non-

executive director of China Mobile Limited. Mr. Chow also serves as a member of Asian Advisory Committee of

AustralianSuper Pty. Ltd. Mr. Chow served as the Chief Executive, Asia Pacifi c Region (ex-Japan) of HSBC Asset

Management (Hong Kong) Limited from 1997 to 2003. From 1992 to 1997 and 2003 to January 2010, Mr. Chow

was a member of the Standing Committee on Company Law Reform of the Government of the Hong Kong Special

Administrative Region (“HKSAR Government”). Mr. Chow also served as Director of the World Federation of Exchanges

from 2003 to January 2010 and became Chairman of its Working Committee in 2007 and 2008 and then its Vice-

chairman in 2009. From 2001 to 2007, he was a member of the Advisory Committee of the Hong Kong Securities

and Futures Commission. Mr. Chow graduated from the University of Hong Kong with a Bachelor’s degree in Science

(Engineering) in 1970. He obtained a Diploma in Management Studies and an MBA in 1979 and 1982, respectively,

from the University of Hong Kong. He also obtained a Diploma in Finance (Distinction) from the Chinese University of

Hong Kong in 1987, and was conferred the Doctor of Social Science, honoris causa by the Open University of Hong

Kong in 2010. He was awarded the title of Justice of the Peace, the Silver Bauhinia Star and the Gold Bauhinia Star by

the HKSAR Government in 2003, 2005 and 2010, respectively. Mr. Chow is a Distinguished Fellow of the Hong Kong

Computer Society, an Honorary University Fellow of the University of Hong Kong, an Honorary Fellow of the Hong

Kong University of Science and Technology, a Fellow of the Hong Kong Institute of Chartered Secretaries, a Fellow of

the Institute of Chartered Secretaries and Administrators, an Honorary Fellow of Hong Kong Securities Institute and a

Certifi ed General Accountant (Honorary) of the Canadian Certifi ed General Accountants Association of Hong Kong.

— 35 —


Jackson Tai, Independent Director of the Bank since March 2011. Mr. Tai has over 35 years of experience in the

banking industry. He held various key positions in DBS Group Holdings Limited (“DBS Group”) and DBS Bank Limited

(“DBS Bank”) including Vice Chairman and Chief Executive Offi cer of DBS Group and DBS Bank from 2002 to 2007,

President and Chief Operating Offi cer of DBS Group and DBS Bank from 2001 to 2002, and Chief Financial Offi cer of

DBS Bank from 1999 to 2001. He was also Director of DBS Bank (China) Limited from 2007 to 2008. Prior to that, he

was with J.P. Morgan & Co. Incorporated from 1974 to 1999. He was Managing Director in the Investment Banking

Division and held senior management positions in New York, Tokyo and San Francisco. He currently serves as a

director of a number of companies listed in New York and Singapore, including Director of Eli Lilly and Company since

2013, Director of Singapore Airlines since 2011, Director of Royal Philips NV since 2011, and Director of MasterCard

Incorporated since 2008. Mr. Tai is a director of privately-held VaporStream, and is also a director of privately held

Russell Reynolds Associates since 2013. Previously, Mr. Tai was a director of NYSE Euronext from 2010 to 2013,

ING Group NV from 2008 to 2010, and CapitaLand from 2001 to 2010. Mr. Tai is also currently a member of the

Asia-Pacifi c Advisory Board of Harvard Business School, and trustee of Rensselaer Polytechnic Institute, director of

the Metropolitan Opera in New York, and a director and member of the Committee of 100. Mr. Tai graduated from

Rensselaer Polytechnic Institute with a Bachelor of Science degree in 1972, and from Harvard University with a Masters

of Business Administration degree in 1974.

Nout Wellink, Independent Director of the Bank since October 2012. Mr. Wellink has served as a member of the

Executive Board of the Dutch Central Bank (“DNB”) for almost 30 years, the last 14 years as its President. He

retired from DNB on 1 July 2011. DNB is since 1999 an integral part of the European System of Central Banks, but

at the same time the national prudential supervisor of banks, pension funds and insurance companies. Since the

establishment of the European Monetary Union, Mr. Wellink served as a member of the Governing Council of the

European Central Bank. Starting from 1997, Mr. Wellink served as a member of the Board of Directors of the Bank

for International Settlements, which he chaired from 2002 to 2006. From 2006 to 2011, he also chaired the Basel

Committee on Banking Supervision. From 1997 to 2011, Mr. Wellink was a member of the Group of Ten Central Bank

Governors and Governor of the International Monetary Fund. Prior to his appointment in 1982 as an executive director

of DNB, Mr. Wellink held several posts in the Dutch Ministry of Finance, including as the Treasurer General from 1977

to 1982. After studying Dutch law at Leyden University from 1961 to 1968 with a Master’s degree obtained, Mr.

Wellink obtained a doctor’s degree in economics at the Rotterdam Erasmus University in 1975. In 2008 he received

an honorary doctorate from Tilburg University. From 1988 to 1998, Mr. Wellink was an Extraordinary Professor at the

Free University in Amsterdam. Mr. Wellink is currently Chairman of the Supervisory Board of the Leyden University,

and Chairman of the Public Interest Committee of PricewaterhouseCoopers Accountants N.V. Mr. Wellink had many

secondary functions in the past, including member of the supervisory board of a bank and other enterprises on

behalf of the Dutch authorities, Chairman of the Board of Supervisors of the Netherlands Open Air Museum, member

and treasurer of the Royal Picture Gallery Mauritshuis and the Westeinde Hospital in The Hague. He was awarded

a Knighthood in the Order of the Netherlands Lion in 1980 and is since 2011 Commander of the Order of Orange-

Nassau.

Lu Zhengfei, Independent Director of the Bank since July 2013. Mr. Lu Zhengfei currently serves as the Associate Dean

and professor of the Accounting Department of Guanghua School of Management, Peking University. He had served

as the head of the Accounting Department of the School of Business, Nanjing University between 1994 and 1999, and

the head of the Accounting Department of Guanghua School of Management, Peking University between 2001 and

2007. Mr. Lu also currently serves as a consulting expert of the China Accounting Standards Committee of the Ministry

of Finance, China, an executive director and an academic committee member of the Accounting Society of China, an

executive director of the China Audit Society, an editorial board member of Accounting Research and Audit Research,

and a member of the Disciplinary Committee of the Chinese Institute of Certifi ed Public Accountants. In 2001, he was

elected as a member of “The Hundred People Project of Beijing New Century Social Science Theoretical Talent”. In

2005, he was elected to the “New Century Excellent Talent Support Plan” of the Ministry of Education, China. He

currently serves as an independent non-executive director or an independent supervisor of a number of companies

listed in Hong Kong Stock Exchange, including: Independent Non-executive Director of Sinotrans Ltd. since September

2004, Independent Non-executive Director of Sino Biopharmaceutical Ltd. since November 2005, Independent Non-

executive Director of China National Materials Co., Ltd. since December 2009, and Independent Supervisor of PICC

Property and Casualty Co., Ltd. (“PICC P&C”) since January 2011. He was an independent non-executive director of

— 36 —


PICC P&C from February 2004 to December 2010. Mr. Lu graduated from Renmin University of China in 1988 with

a Master’s degree in Economics (Accounting), and received his Doctor’s degree in Economics (Management) from

Nanjing University in 1996.

Leung Cheuk Yan, Independent Director of the Bank since September 2013. He is a former partner of Baker &

McKenzie, which he joined in July 1987 and from which he retired in June 2011. During 2009 and 2010, he had served

as a part-time member of the Central Policy Unit of The Hong Kong Special Administrative Region Government. Mr.

Leung has been an independent non-executive director of MMG Limited, which is listed on The Stock Exchange of

Hong Kong Limited, since July 2012. Mr. Leung graduated from The Chinese University of Hong Kong with a Bachelor

of Social Science degree (First Class Honours) in 1976, obtained a Master of Philosophy degree from The University of

Oxford in 1981 and completed his legal study at The College of Law in England in 1982. He was admitted to practice

as a solicitor in Hong Kong in 1985, in England and Wales in 1988, in the Australian Capital Territory in 1989 and in

Victoria, Australia in 1991. He is a Senior Associate Member of St. Antony’s College, Oxford.

As stipulated in relevant domestic regulatory requirements and Rule 3.13 of the Hong Kong Listing Rules, the Bank

has received the annual confi rmation in writing from each Independent Director with regard to his/her independence.

Based on these confi rmations and relevant information in possession of the Board of Directors, the Bank confi rms their

independent status.

II. Annual Duty Performance of Independent Directors

1. Attendance of Shareholders’ meetings, Board meetings and special committee meetings

In 2013, the Bank convened two shareholders’ meetings, including an extraordinary general meeting on 26

March and the Annual General Meeting on 29 May with 100% attendance of Independent Directors. The Bank

convened nineteen Board meetings, including eight on-site meetings of the Board of Directors on 30 January, 26

March, 25 April, 29 May, 29 July, 29 August, 30 October and 19 December, respectively and eleven meetings of

the Board of Directors via written resolutions, and the attendance rate of Independent Directors reached 100%.

In 2013, the Bank convened twenty-fi ve special committee meetings. The attendance of Independent Directors at

the shareholders’ meetings, Board meetings and special committee meetings is given below:

Number of meetings attended in person/Number of meetings convened during term of offi ce

Special Committees

Incumbent DirectorsShareholders’

MeetingBoard of

Directors

Strategic Development

CommitteeAudit

CommitteeRisk Policy Committee

Personnel and Remuneration

Committee

Connected Transactions

Control Committee

Chow Man Yiu, Paul 2/2 19/19 — 5/5 5/5 7/7 3/3Jackson Tai 2/2 19/19 5/5 5/5 3/3 — 2/3Nout Wellink 2/2 19/19 5/5 5/5 5/5 — —Lu Zhengfei 0/0 9/9 — 3/3 — 1/1 1/1Leung Cheuk Yan 0/0 6/6 — 2/2 — 0/0 1/1

Note:

(1) Mr. Jackson Tai began to serve as a member of the Risk Policy Committee of the Bank as of 15 July 2013.

(2) Mr. Lu Zhengfei began to serve as Independent Director, a member of the Audit Committee, the Personnel

and Remuneration Committee and the Connected Transactions Control Committee of the Bank as of

31 July 2013. Mr. Lu Zhengfei began to serve as Chairman of the Audit Committee of the Bank as of 11

September 2013.

(3) Mr. Leung Cheuk Yan began to serve as Independent Director, a member of the Audit Committee, the

Personnel and Remuneration Committee, Chairman and a member of the Connected Transactions Control

Committee of the Bank as of 11 September 2013.

— 37 —


(4) Independent Director Jackson Tai was not able to attend the Connected Transactions Control Committee

meeting on 17 December 2013, and entrusted another Independent Director to attend the meeting and

vote on his behalf.

2. Convening of Shareholders’ Meeting and Relevant Resolutions

On 26 March 2013, the Bank held its 2013 First Extraordinary General Meeting in Beijing. This meeting

considered and approved three proposals including the proposal to elect Non-executive Director, the proposal

on downward adjustment to the conversion price of the A-Share convertible bonds of the Bank and the proposal

to amend the Articles of Association. The proposal on downward adjustment to the conversion price of the

A-Share convertible bonds of the Bank and the proposal to amend the Articles of Association of the Bank were

special resolutions.

On 29 May 2013, the Bank held its 2012 Annual General Meeting in Beijing and Hong Kong by way of video

conference. This meeting considered and approved 20 proposals including the 2012 work report of the Board

of Directors, the 2012 work report of the Board of Supervisors, the 2012 annual fi nancial statements, the 2012

profi t distribution plan, the 2013 annual budget, the appointment of Ernst & Young Hua Ming as the Bank’s

external auditor for 2013, the election of Directors, the re-election of Directors, the re-election of Supervisors, and

the issuance of qualifi ed write-down Tier-2 capital instruments, among others. The proposal on the issuance of

qualifi ed write-down Tier-2 capital instruments was a special resolution.

3. Convening of the Board Meetings

In 2013, in accordance with the Articles of Association, the Procedural Rules of the Board of Directors of Bank

of China Limited and the Work Rules of Independent Directors of Bank of China, Independent Directors attended

the Board meetings, reviewed proposals, actively took part in discussions, sought clarifi cations and additional

answers, put forward professional recommendations and expressed opinions independently in a professional,

objective, and responsible manner.

In 2013, the Bank convened eight on-site meetings of the Board of Directors on 30 January, 26 March, 25

April, 29 May, 29 July, 29 August, 30 October and 19 December, respectively. At these meetings, the Board

of Directors reviewed and approved 44 proposals related to the Bank’s regular reports, the nomination of

candidates for Directors, the election of the Chairman, the 2012 corporate social responsibility report, the 2012

internal control self-assessment report, the Bank of China Limited Board Diversity Policy, the Development

Strategy Plan of the Bank for 2013–2016, the 2014 operating budget, the Group Recovery and Resolution Plans,

and so on. It also heard nine reports related to the Bank’s consolidated management and other matters.

In 2013, the Bank convened eleven meetings of the Board of Directors via written resolutions. At these meetings,

the Board of Directors approved the proposals related to changes in the composition of special committees

under the Board of Directors and the Announcement in Relation to the Increase in Shareholding of the Bank by Its

Controlling Shareholder, among others.

— 38 —


4. Convening of the Special Committees of the Board of Directors

The Strategic Development Committee held fi ve meetings in 2013. At these meetings, it mainly approved

the proposal on profi t distribution for 2012, the proposal on issuing qualifi ed write-down capital instruments

and the Development Strategy Plan of the Bank for 2013–2016 (including the capital management planning

for 2013–2016). In response to changes in international and domestic economic and fi nancial situations, the

Strategic Development Committee stepped up its analysis of the operating environment, paid due attention

to opportunities and challenges brought about by interest and exchange rate liberalisation, opportunities to

strategically expand our Bank’s presence in key overseas markets, deposit insurance scheme and other major

policies on the Bank, and put forward many important comments and recommendations for formulating and

implementing the Bank’s strategic development plans and improving its capital management, thus providing

strong support to the scientifi c decision-making of the Board of Directors.

The Audit Committee held fi ve meetings in 2013. It mainly reviewed such proposals as the Bank’s quarterly,

interim and annual fi nancial reports, the annual self-assessment report on internal control, the matter of

requesting the annual general meeting to approve the appointment of external auditor for 2013 and the

appointment and audit fee of the external auditor for 2014. In addition, the Audit Committee reviewed and

approved the internal audit work plan and budget for 2013 and the internal audit priorities for 2014. It heard a

report on major inspection fi ndings by the internal audit function in 2012, a report on internal audit related to

anti-money laundering and IT audit, a report on the audit progress of internal control by the external auditor,

an assessment report on anti-money laundering and a report on the 2014 audit plan of the external auditor

and on the external auditor’s independence compliance. The Audit Committee undertook an important role in

paying close attention to the on-boarding and orientation of Ernst & Young as the Bank’s new external auditor,

improvement of business performance, enhancement of internal control and intensifi cation of risk control of the

Bank.

The Risk Policy Committee held fi ve meetings in 2013, in which it mainly reviewed and approved the

Group’s recovery and resolution plan, the statement and qualifi cation plan of the Group’s risk appetite, data

management framework policy, management measures and limits for country risk, market risk limit and credit

proposals exceeding the approval authority of the senior management. The committee also regularly reviewed

the Group risk reports and progress reports regarding the Bank’s implementation of the New Basel Capital

Accord. In addition, the committee paid constant attention to critical risk issues, such as the Bank’s loans to

certain industries, in response to changes in overseas and domestic economic and fi nancial conditions and

adjustments of the government’s macro policies. The committee members brought forward important opinions

and recommendations regarding the improvement of the Bank’s risk governance mechanism and the effective

prevention and control of risks, including credit risk, market risk, operational risk, legal and compliance risk,

liquidity risk, and so on.

The Personnel and Remuneration Committee held fi ve on-site meetings and two meetings by written resolution

in 2013. At these meetings, the committee mainly approved proposals on the performance evaluation and

remuneration distribution plan for the Chairman, Executive Directors and senior management members for 2012,

the 2013 performance targets for the Group, performance targets for the Chairman, the President, the Chairman

of the Board of Supervisors and other senior management members, proposal on election of Mr. Tian Guoli

as the Chairman of the Bank, proposals on nomination of candidates for Executive Directors, Non-executive

Directors and Independent Directors, proposal on re-appointment of the Company Secretary of the Bank, and

a proposal on Board Diversity Policy of Bank of China Limited. The committee also reviewed the remuneration

distribution plan for the Chairman of the Board of Supervisors and shareholder supervisors in 2012. The

committee put forward important opinions and recommendations on further improving the Bank’s performance

evaluation management in compliance with regulatory requirements.

— 39 —


The Connected Transactions Control Committee held three meetings in 2013, in which it mainly reviewed and

approved the report on the confi rmation of connected parties list of the Bank and the schedule of the committee

meetings in 2014. The committee also reviewed the special report of funds occupied by controlling shareholders

and other related parties in 2012, the statement of the Bank’s Connected Transactions in 2012, and the report

on the Implementation Rules for the Management of Connected Party Transactions of Bank of China Limited

(2013 Version). During the reporting period, the committee paid constant attention to issues such as the IT

system for connected transactions and transactions with key connected parties. The committee members offered

important opinions and recommendations regarding IT system constructions and data report of the connected

transactions, among others.

In 2013, the Independent Directors did not raise any objection to the resolutions of the Board of Directors or its

special committees.

In 2013, Independent Directors put forward recommendations on the Bank’s strategic planning, deposit

gathering, capital management, liquidity risk management, anti-money laundering, data management,

consolidated management, and so on. The recommendations were discussed and acted upon by the Bank.

5. On-site Research

In 2013, Independent Directors paid great attention to the affairs of the Bank, kept updated of the Bank’s

business development, the implementation of strategies of the Board, and conducted on-site research exercises

at the international leading banks and the Bank’s domestic and abroad branches with written reports.

6. Support to the Work of Independent Directors by the Bank

In 2013, the Bank enhanced communication between the Board of Directors and the management, organized

communication meetings, which improved Independent Directors’ understanding of the Bank’s business and

management, and ensured higher effi ciency of the deliberation of the Board. In 2013, according to the specifi c

needs for communication of Independent Directors, the Bank organized small-group communication in various

forms on issues of concern to Independent Directors apart from the routine communication meetings attended by

members of the Board of Directors.

In 2013, the Bank continued to provide information support to Independent Directors, submitted ten reports

on the work of the management, and forty-fi ve Board Communications to Directors. In addition, the Bank also

provided relevant information to Directors in a timely manner on major issues of concern to Directors such as

the operation and management of the Bank, regulatory policies, business development and cross-border RMB

business.

In 2013, the Board of Directors paid much attention to enhance Directors’ expertise, with a special focus on

arranging relevant trainings. All Directors of the Bank fully observed Rule A6.5 of the Corporate Governance Code

of the Hong Kong Stock Exchange as well as regulatory requirements of Chinese mainland and participated

in many special training sessions focused on topics such as internationalization of the RMB, interest rate

liberalisation and commercial bank development, corporate governance of large banks, norms for annual report

audit and fi nances, laws and regulations on inside information and the Hong Kong Listing Rules. The Bank gave

a detailed explanation of its business operations to all newly appointed Non-executive Directors and Independent

Directors in 2013.

The Board of Directors, the senior management and relevant staff actively and effectively provided coordination

and support to Independent Directors in performing their duties.

— 40 —


III. Major Matters of Attention to Independent Directors in the Annual Duty Performance

1. Connected Transactions

The Independent Directors of the Bank paid great attention to connected transactions management. The Bank

intensifi ed the management of its connected transactions and internal transactions. It updated databases of the

Group’s connected parties and enhanced the management quality and effi ciency of connected party information.

It constantly improved functions of the monitoring system and mechanism for connected transactions.

2. Guarantee Business of the Bank and Capital Occupation

Pursuant to the provisions and requirements by CSRC, and according to the principles of justice, fairness

and objectivity, the Independent Directors of the Bank have provided the following information regarding the

Bank’s guarantee business: the guarantee business is one of the Bank’s ordinary business activities. It has

been approved by PBOC and CBRC and does not fall within the scope of guarantees as defi ned in the Circular

on Regulating Guarantee Businesses of Listed Companies. The Bank has formulated specifi c management

measures, operational processes and approval procedures in light of the risks of the guarantee business and

carried out this business accordingly. The Bank’s guarantee business principally comprises letters of guarantee.

As at 31 December 2013, the outstanding amount of letters of guarantee issued by the Bank was RMB846.497

billion.

3. Capital Management and Use of Raised Funds

The Board of Directors were attentive throughout the year to the Bank’s capital structure. All proceeds raised

from initial public offerings, the issuances of subordinated bonds and Convertible Bonds, Rights Issue of A

Shares and H Shares have been used to replenish the Bank’s capital and increase the level of capital adequacy in

compliance with domestic and international guidelines on capital adequacy and liquidity management. No further

capital were raised during the reporting period of the Bank.

4. Nomination and Remuneration of Senior Management Members

The Board of Directors and the Personnel and Remuneration Committee of the Bank reviewed and approved

the Proposal on the Nomination of Mr. Tian Guoli as Candidate for Executive Director of the Bank and it was

approved at the 2012 Annual General Meeting. The Board of Directors and the Personnel and Remuneration

Committee of the Bank also reviewed and approved the Proposal on election of Mr. Tian Guoli as the Chairman

of the Bank.

In accordance with the Rules for Remuneration Review of Central Financial Corporations issued by the Ministry

of Finance, the Board of Directors and the Personnel and Remuneration Committee of the Bank reviewed and

approved the 2012 Remuneration Distribution Plans for the Chairman of the Board of Directors, Executive

Directors, and the Senior Management Members.

5. Performance Results Forecast and Results Briefi ng

In 2013, the Independent Directors of the Bank reviewed relevant result reports with a focus on the authenticity,

accuracy and completeness of the reports, thus ensuring that there were no false recordings, misleading

statements, or signifi cant omissions. The Bank published relevant result reports in a timely manner in accordance

with the provisions of the Shanghai Stock Exchange and the Hong Kong Stock Exchange, and did not publish

results forecast or results briefi ng.

— 41 —


6. Appointment or Change of the Accountant

The Board of Directors of the Bank reviewed and approved the Proposal regarding the Engagement of External

Auditor and Audit Fee for 2013 on 23 August 2012, and suggested to engage Ernst & Young Hua Ming LLP

as the Bank’s auditor on fi nancial statements and external auditor on internal control for 2013. Based on the

evaluation of the work of Ernst & Young since 2013, the Board of Directors of the Bank reviewed and approved

the Proposal on the Engagement and Fees of Accountant for 2014 on 19 December 2013 and suggested that

the Bank continue to engage Ernst & Young Hua Ming LLP (special general partner) to be the Bank’s domestic

accounting fi rm and external auditor of internal control in 2014, and continue to engage Ernst & Young as the

Bank’s international accounting fi rm in 2014.

7. Cash Dividend and Investors’ Return

In 2013, the Bank amended the Articles of Association related to the cash dividend. This amendment clarifi ed the

Bank’s profi t distribution principles, policy and adjustment procedures, the consideration process of the profi t

distribution plan and other matters. The amendment stated that the Bank shall adopt cash dividend as the priority

form of profi t distribution. Except under special circumstances, the Bank shall adopt cash as the form of dividend

distribution where there is profi t in that year and the accumulated undistributed profi t is positive, and that the

cash distribution of the dividend shall not be less than 10% of the profi t after tax attributable to the shareholders

of the Bank. The amendment also stated that the Bank shall offer online voting to shareholders when considering

amendments to profi t distribution policy and profi t distribution plan.

At the 2012 Annual General Meeting held on 29 May 2013, a fi nal dividend for 2012 of RMB0.175 per share

(before tax) was approved for payment. The distribution plan was accomplished in July 2013 and the actual

distributed amount was RMB48.851 billion (before tax).

8. Anti-money Laundering

Independent Directors take the matter of anti-money laundering seriously. During the year, the Independent

Directors asked the Bank’s Legal and Compliance Department and the External Auditors to separately prepare

extensive assessment of the Bank’s anti-money laundering resources and capabilities. Partly as a result of

these reviews, the Bank developed and refi ned an embedded anti-money laundering management mechanism

across its business lines. It also enhanced its anti-money laundering expertise and promoted a centralised

identifi cation model for suspicious transactions in all domestic institutions. The Bank strengthened the monitoring

of suspicious transactions and worked on the establishment and assessment of a suspicious transactions model.

It closely tracked and studied international trends and changes in sanction compliance requirements of related

countries and regions, made timely assessments of risks and adjusted its business policies. It improved the

functions of its anti-money laundering system by upgrading the domestic system and promoting its application

among overseas institutions.

9. Implementation of the Commitment of the Company and Shareholders

Independent Directors attached great importance to the implementation of the commitment of the Company

and Shareholders. Huijin made a “non-competing commitment” when the Bank launched its IPO to the effect

that, so long as Huijin continues to hold any of the Bank’s shares or is deemed to be a controlling shareholder

or a connected person of a controlling shareholder in accordance with the laws or listing rules of PRC, or of the

place where the Bank’s shares are listed, it will not engage or participate in any competing commercial banking

activities, including but not limited to extending loans, taking deposits and providing settlement, or providing

fund custodian, bank card and currency exchange services. However, Huijin may, through its investments in

other commercial banks, undertake or participate in certain competing businesses. To that regard, Huijin has

undertaken that it will: (i) treat its investment in commercial banks on an equal footing and not take advantage of

its status as a holder of the Bank’s shares or take advantage of the information obtained by virtue of such status

to make decisions or judgments against the Bank and in favour of other commercial banks; and (ii) exercise its

shareholder’s rights in the Bank’s best interests. During the reporting period, there was no breach of material

undertakings by Huijin.

— 42 —


10. Implementation of Information Disclosure

In 2013, the Bank prepared and disclosed its regular and provisional reports in strict adherence to the principles

of truthfulness, accuracy, completeness, timeliness and fairness. It continuously enhanced the pertinence,

effectiveness and transparency of information disclosure in order to guarantee investors’ access to relevant

information.

The Bank thoroughly reviewed and revised the Management Measures on Responsibility Investigation on Material

Information Disclosure Errors of Regular Reports of Bank of China Limited, to further strengthen the work

procedures and quality control related to its regular reports. The Bank strictly carried out the Rules Governing

Persons with Knowledge of Inside Information of Bank of China Limited and other relevant regulatory rules, to

ensure that inside information was kept confi dential, a well-managed system was in place for registering those

with access to inside information for fi ling purpose and their management, and that inside trading was strictly

prohibited. The Bank paid close attention to relevant regulatory rules and requirements, revised the information

disclosure work procedures and developed case studies to improve the initiation, planning and long-term

perspective of its management work, and thus enhanced its information disclosure management ability and

compliance level.

11. Implementation of Internal Control

The Bank continued to implement the Basic Standard for Enterprise Internal Control and its supporting

guidelines, sticking to the primary goal of ensuring the effectiveness of its internal controls over the fi nancial

reporting process and the accuracy of fi nancial information, and constantly improved non-fi nancial internal

controls. More effort was devoted to making technology central to enhancing risk identifi cation and pre-judgment

ability and to developing more automated, sophisticated and professional internal controls.

The Bank established and implemented a systematic fi nancial accounting policy system in conformity with the

relevant accounting laws and regulations. Accordingly, the Bank’s accounting basis was strengthened and

the level of standardisation and elaboration of fi nancial accounting management was improved. The Bank has

strengthened its fi nancial and accounting management, so as to ensure the validity of the internal control over

fi nancial reporting. The fi nancial statements of the Bank comply with the applicable accounting standards as well

as related accounting regulations, and present fairly, in all material respects, the fi nancial position of the Bank, its

operational performance and cash fl ows.

12. Operation of the Board of Directors and Special Committees

The Strategic Development Committee, the Audit Committee, the Risk Policy Committee, the Personnel and

Remuneration Committee, and the Connected Transactions Control Committee are set under the Board of

Directors, and responsible for assisting the Board of Directors in performing duties from different perspectives.

The convening of the Board meeting and special committee meetings was in compliance with legal procedures,

regulatory requirements and the Articles of Association, and the Bank’s own guidelines, procedures, and major

operational matters have gone through relevant approval procedures, and were legal and appropriate. The

Board of Directors and special committees earnestly performed duties, improved their understanding of business

operation, studied and reviewed matters within their respective duties.

— 43 —


IV. Comprehensive Assessment and Suggestions

In 2013, Independent Directors fulfi lled their duties in good faith and diligently to safeguard the interests of the Bank

and its shareholders, including the interests of minority shareholders.

In 2014, Independent Directors will continue to perform their duties professionally, in line with applicable laws and

regulations, the Articles of Association and the inherent requirements of sound corporate governance on Independent

Directors in order to safeguard the legitimate rights and interests of the Bank and its shareholders, including the

interests of minority shareholders and make greater contribution to the Bank.

Independent Directors of Bank of China Limited

Chow Man Yiu, Paul, Jackson Tai, Nout Wellink, Lu Zhengfei, Leung Cheuk Yan

中國銀行股份有限公司 BANK OF CHINA...

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