Annual Report 2012

5 MANAGEMENT DISCUSSION AND ANALYSISIn 2012, Sino-German Bausparkasse’s business developed rapidly. It achieved remarkable results in selling housing savings products, andexhibited notable advantage in indemnificatory housing loans. At the end of 2012, the total assets of Sino-German Bausparkasse wereRMB17,425 million. Shareholders’ equity was RMB2,152 million. Net profit increased to RMB102 million.CCB Principal Asset ManagementCCB Principal Asset Management Co., Ltd. has a registered capital of RMB200 million, of which the Bank contributed 65%, and PrincipalFinancial Services, Inc. and China Huadian Capital Holdings Company Limited, contributed 25% and 10% of the shareholding respectively. It isengaged in raising and selling of funds, asset management as well as other businesses permitted by the CSRC.In 2012, CCB Principal Asset Management completed fundraising for seven new funds including Jianxin Yueying Comfort Wealth ManagementDebt Securities Investments Funds, Jianxin Pure Debt Securities Investment Fund, and all of the funds operated steadily. At the end of 2012,CCB Principal Asset Management had total assets of RMB721 million, and shareholders’ equity was RMB575 million. It managed 28 funds intotal with a net asset value of RMB95,217 million. Its net profit was RMB131 million.CCB LifeCCB Life Insurance Company Limited has a registered capital of RMB4,496 million, of which the Bank, China Life Insurance Co., Ltd. (Taiwan),the National Council for Social Security Fund, China Jianyin Investment Limited, Shanghai Jin Jiang International Investment and ManagementCompany Limited, and Shanghai China-Sunlight Investment Co., Ltd contributed 51%, 19.9%, 14.27%, 5.08%, 4.9% and 4.85% respectively.In 2012, CCB Life increased its capital by RMB5,721 million, of which, the Bank contributed RMB2,892 million, and successfully initiated theNational Council for Social Security Fund’s investment in CCB Life. CCB Life’s business scope includes personal insurance such as life, health,accidental injury insurance, reinsurance of the above-mentioned business, as well as the use of insurance fund permitted by the national laws andregulations.In 2012, CCB Life pushed forward the development of its business lines with enhanced product development and service philosophy. At theend of 2012, the total assets of the company were RMB17,769 million; shareholders’ equity was RMB7,053 million. Premium income for 2012amounted to RMB5,868 million, and the net profit was RMB49.64 million.Rural BanksAt the end of 2012, the Bank sponsored the establishment of 26 rural banks in Hunan Taojiang and many other places. The registered capital ofthese rural banks totalled RMB2,620 million, of which RMB1,326 million was contributed by the Bank.The rural banks took multiple measures to support the farmers and rural areas based on local conditions. They introduced credit products suchas co-guaranteed loans and business loans for farmers. While providing efficient financial services for “agriculture, farmers and rural areas” andsmall and micro-enterprises in the counties, the rural banks achieved sound operating results as well. At the end of 2012, the assets of the ruralbanks in operation totalled RMB10,926 million, and shareholders’ equity was RMB2,516 million. Net profit for 2012 was RMB130 million. Thedeposits were RMB7,112 million; loans were RMB6,987 million, of which agriculture-related loans accounted for 91.75%. The non-performingloan ratio was 0.07%, reflecting effective controls on asset quality.Feature Article: Integrated Operations and Synergistic DevelopmentThe Group’s integrated operation strategy is to accelerate the development of the insurance, trust, investment banking, mutual funds, leasing,securities and other non-banking businesses, while developing banking as its core business. The Group endeavours to build an operatingframework that covers interconnected markets and complementary businesses, with diversified income and decentralised and controllablerisk, and realise customer-oriented functions selection, to provide customers with integrated and diversified financial services.At the end of 2012, the Group had eight domestic and overseas operating subsidiaries and 26 rural banks, with businesses covering fund,leasing, trust, insurance, investment banking and other industries. The Group enjoyed the advantage in terms of type of licences compared tothe peers and its integrated operation platform has been initially established.Thanks to the parent bank’s business channels and customer base, the subsidiaries grew at a much higher rate in terms of total assetsand profits than the average growth rates of the Group and the industries. At the end of 2012, the total assets of the subsidiaries wereRMB260,839 million; net profit for the year was RMB2,139 million. Asset quality remained good.38 China Construction Bank Corporation annual report 2012