RISK CONTROL

CREDIT RISK

Prudent trade selection: Selecting the trade which has centuries of history and is closely related to the the national economy to reduce the systemic risk. Scientific selection of the customers: Choosing the customers who have a significant position and excellent competitive ability in their trade to cooperate. Efficient assets management: Fully resolve the non-performing assets through remote positioning control, dynamic, scientific management, and expanding the extensive resources and disposal channels of the leasing objects.

LIQUIDITY RISK AND MARKET RISK

Liquidity gap management: Through the launching mechanism of business reporting planning, annual business planning, process prediction models, historical forecast models and other liquidity management tools to do a comprehensive forecast to the future cash flowing of the company, and according to it to plan a reasonable financing program, and the liquidity risk contingency plan to ensure the middle term and short-term liquidity safety of the company. Optimal maturity mismatch decision: Given the stock of assets, a debt scale and structure, and considering the developing continuity of the new added business in the future , under the binding premise of ensuring the middle-term, long-term liquidity security to make out the optimal assets and liabilities maturity mismatch structure of the costbenefit.

LIQUIDITY SECURITY CONTROL MECHANISM

In the short term: To ensure the balance of supply and capital requirements within the period through the refine financial planning and cash flowing forecasting tools. In the middle and long term: Getting the optimal maturity structure of assets and liabilities by the planning of the maturity structure optimization model to get a stable middle and long term cash flow arrangements under the premise of ensuring the business continuity and solvency.

OPERATIONAL RISK

Well-established internal control system: The company established an internal control system which covers the compliance, credit underwriting, business, finance and so on. Efficient business process: The company established a business process includes the customer marketing, project evaluation, business operation, assets management and so on. Sound training system: The company established a hierarchical and classified training system for the employees which covers marketing, finance, customer evaluation, project operation and so on. trict authority management: According to the different levels of ability and the items with different operating difficulties to have a full range of counseling and assessment to the employees. Effective system tools: The entire management system has varied levels, and a full range of systems and tools to effectively promote the propulsion of the various management issues. Intensive backup platform: By integrating and establishing a standardized, intensive backup operating platform, the company can effectively reduced the cost of the business management and improved the efficiency and enhanced the customers’ satisfaction.

MEASURING AND RATING SYSTEM

Post sub-prime crisis, the Company paid heavy attention to the building of the 2-dimension internal measuring and rating system in customer and project. In 2015 , through the introduction of sophisticated rating technologies and methodologies from international risk-management consultancy companies with state of art implementation capabilities, the Company had been fully equipped with mechanisms, tools, methodologies and systems in terms of internal measuring and rating, which had boosted the Company’s expertise and brand clout. Apart from realizing consistency in companylevel credit rating, the improved measuring and rating system also set foundation for future developments in credit risk portfolio analysis, high-risk customer limit setting, risk capital distribution and performance appraisal, etc.