On April 1, 2021, China Huarong held a meeting with investors in Beijing. Executive Director and Vice President Wang Wenjie (currently performs the duties of the President) answered questions from analysts and investors regarding delays in publishing the 2020 annual results. Representatives of Shareholders, major investment banks at home and abroad, large institutional investors and rating agencies were invited to participate via teleconference. Heads of relevant company departments were present at the meeting.

　　According to China Huarong, the the publication of the annual results of the Group for the year ended 31 December 2020 will be delayed as a relevant transaction of the company is still being finalized and the auditor will need more information and time to complete the necessary audit procedures for the audit of the financial information of the Group for the year ended 31 December 2020. The Board, after due and careful consideration, is of the view that it would not be appropriate for the company to publish the unaudited management accounts of the Group for the year ended 31 December 2020 at this stage as it may not accurately reflect the financial performance and position of the Group and the publication of the unaudited management accounts could cause confusion and may be misleading to the Shareholders and potential investors of the company. The company is working closely with the auditor to provide all the required information and documents so that the auditor can complete its audit as soon as possible. The expected date of the publication of the 2020 Annual Results will need to be further agreed with the auditor and a separate announcement will be made for this. 

　　Over the past three years, China Huarong has been committed to refocusing on its core business of distressed asset management, stepping up its core business transformation and promoting risk control and downsizing. A series of positive changes have been made in terms of structural transformation and development trend. The core business’ contribution to the company’s performance has consistently improved, profitability from stock assets effectively enhanced, and the structure of assets, business and personnel optimized, combining to bolster the company’s development momentum. China Huarong said that currently the company maintains overall stability with its business operating normally. Following the AMC’s development orientation set by the government, China Huarong gives full play to its counter-cyclical financial rescue function, serves the real economy and defuses financial risks. Its annual work plans are being implemented orderly as scheduled.

　　Meanwhile, the promising prospects of the country’s distressed asset industry will present China Huarong more opportunities in terms of core business development. On the one hand, the shock of the covid-19 pandemic, coupled with the lag effect of the financial cycle, are likely to generate increased demand for financial risks resolution and disposal. Over the past few years, the classification and disposal of banking sector’s non-performing assets (NPA) has undergone significant progress. From 2017 to 2020, RMB 8.8-trillion NPL were disposed accumulatively, exceeding that in the previous 12 years combined. As small and medium-sized financial institutions continue to be exposed to risks, accompanied with the launch of bad personal loans transfer trials, the disposal of NPLs is expected to be further increased. With NPL business at its core, China Huarong has a great opportunity to benefit from the market with huge potential and broad prospects. On the other hand, with the deepening of supply-side structural reforms, transformation and upgrading of economic structure and continued progress in capital market reform, demands for financial relief to troubled enterprises, mergers and acquisitions, bankruptcy and restructuring, mezzanine investments will keep rising. This development will help China Huarong to explore its restructuring business, further perform its financial rescue function and serve the real economy.