On the morning of January 5, 2022, China Huarong Asset Management Co., Ltd. (stock code: 2799.HK) (“China Huarong”, the “Company”) held a press conference in Beijing, providing updates on strategic investor introduction and capital increase, the resumption of stock trading, as well as the Company’s operating results and development strategy for the next step. Wang Wenjie, Executive Director and Vice President of China Huarong, Xu Yongli, Vice President and Board Secretary of China Huarong, Xu Wei, Deputy General Manager of the Department of Strategic Development of CITIC Group, a representative of strategic investors, Luo Yihong, General Manager of Zhongbao Rongxin Fund and Senior Executive Director of the investment team of China Insurance Investment Co., Ltd., and He Zhenfu, Senior Director of the investment team of China Insurance Investment Co., Ltd. attended the meeting. Representatives of China Huarong, CITIC Group and Zhongbao Rongxin Fund respectively delivered speeches on the strategic investor introduction and capital increase move, and heads of relevant departments of China Huarong answered questions raised by reporters at the meeting. Several mainstream media participated in the meeting via the telephone conference system.

　　In his speech, Wang Wenjie, Vice President of China Huarong, said the successful completion of strategic investor introduction and capital increase marks the interim results of historical significance realized in the high-quality development of China Huarong through three years of unremitting efforts. Over the last three years, with a generally sound momentum in overall operation, the Company has achieved a series of structural and trend changes, followed a path to normal development, and witnessed notable improvements in employees’ political quality and professional abilities. That lays a solid foundation for strategic investor introduction, capital increase and high-quality development of the Company, and takes the development of China Huarong to a new stage. Through strategic investor introduction and capital increase, China Huarong has effectively supplemented Core Tier One Capital, improved capital regulation indicators and the shareholding structure, greatly enhanced risk prevention capability, and cemented the foundation for sustainable development. The strategic investors introduced this time are all market leaders in various fields, fully showing their positive view of the long-term development of China Huarong and the distressed asset management industry, and creating favorable conditions for the stabilization of market cap after the trading of the Company’s stock is resumed.  

　　Wang Wenjie said that China Huarong will reappear in the market with a new image after the resumption of stock trading. In the future, it will focus more on the main business, and concentrate resources to improve the core competence of non-performing asset (NPA) management. In face of the opportunities in the NPA market and constant market segmentation, China Huarong will further consolidate the NPA system with acquisition-based disposal, acquisition-based restructuring and debt-to-equity swap as the core business, give play to the role of counter-cyclic adjustment and financial bailout, and continuously improve the capability of serving national strategies and real economy. Under the new shareholding structure and corporate governance mechanism, it will implement new development strategies, upgrade the development paradigm, and work to live up to the expectations of the country, the people, shareholders, investors and the market.

　　Xu Yongli, Vice President of China Huarong, said, the strategic investor introduction and capital increase move marks a new chapter in the Company’s development and takes the Company to a new stage. In the future, China Huarong will resolutely implement the arrangements of the central financial authorities, and, guided by major shareholders and the regulatory authorities and based on the positioning as a financial asset manager, further strengthen and refine its main business, and intensify the four functions of the business, i.e. “disposal of distressed assets”, “activation of defective projects”, “restructuring of troubled enterprises” and “crisis institution bailout”, so as to sharpen the competitive edge of its main business.

　　According to CITIC Group, participation in China Huarong’s strategic investor introduction and capital increase is aligned with CITIT Group’s strategic positioning and planning for the 14^th Five-year Plan period. In its 14^th Five-year Plan, CITIC Group clearly defined the mission of “practicing national strategies and promoting national rejuvenation”, put forward the goal of “realizing RMB10 trillion assets, entering the top 100 of Global 500 enterprises, achieving RMB100 billion of net profits and RMB1 trillion of revenue” and the “553” strategy, made comprehensive financial services the “cornerstone” and “stabilizer” of its business, and proposed to “complete its business presence as an AMC”. Investing in China Huarong will further improve CITIC Group’s deployment in NPA management, boost the capability of comprehensive financial services in serving real economy, and help CITIC Group better implement national strategies. CITIC Group is optimistic about the prospects of the NPA management industry and the long-term potential of China Huarong. As one of the four major financial asset management companies in China, China Huarong, dedicated to NPA management for years, has accumulated certain industrial experience, project resources and customer resources, and enjoys a sound development foundation and huge growth potential. It’s believed that with the joint support from all shareholders, China Huarong will uphold its correct positioning, and return to its main business through downsizing efforts. By further optimizing corporate governance and improving risk control, China Huarong will strengthen the competitiveness of its main business and release and demonstrate its market values.  

　　According to Zhongbao Rongxin Fund, it’s optimistic about the NPA management industry, and China will see structural opportunities and development potential for the industry given the macroeconomic environment at home and abroad. It’s cheerful about the future development of China Huarong, which has achieved notable results in the coordinated rectification of ecology, return to the main business, institutional slimming for lower risks, as well as the improvements of quality and efficiency over the past years. With the completion of the capital increase, China Huarong will further increase the capital adequacy ratio, intensify risk prevention capability, and reinforce the foundation for sustainable operation, which will pave the way for its further focus on the main business in the future. It’s also positive about its business synergy with China Huarong, and will advance business synergy and experience sharing with China Huarong in relevant fields, so as to accelerate China Huarong’s return to its main business and jointly support the high-quality development of real economy.

　　At the press conference, the Company’s management team and strategic investors frankly exchanged ideas with participating media on strategic investor introduction and capital increase, resumption of stock trading, main business operating results, development strategies, and institutional downsizing, sending a clear message to the capital market that China Huarong has ushered into a new stage of high-quality development.