ICBC officially announced its 2004 Annual Report. The Report disclosed that ICBC realized an operating profit of RMB 76.4 billion in 2004, RMB 11.1 billion increased or 17.4% compared to last year. Domestic Tier 1 branches are all profitable. Overseas organizations achieved an operating profit of USD 170 million. Operating profitability rate of assets and capital reached 1.36% and 44.7%, or 0.1 and 8.29 percentage points increased respectively compared to last year. Profitability capacity was remarkably enhanced. Cost-income ratio is 41.98%, 4.73 percentage points drop compared to last year. Level of cost control showed distinctive signs of improvement.

In 2004, balance and ratio of non-performing assets both decline after strictly followed the Classified 5-grade Standard to strengthen the truthfulness of loan quality. Balance of non-performing assets dropped RMB 42.4 billion. Non-performing assets rate was down to 14.32%, or 1.87 percentage points decrease compared to last year, of which, balance of non-performing loan decreased RMB 17.1 billion RMB, rate of non-performing loan fell to 18.99%, or 2.25 percentage points decrease. Since 1999, non-performing rate of newly increased loan is 1.57%, a risk control that met the level of international advanced banks.

Annual Report showed that ICBC's earnings structure was further optimized in 2004. Net Operating Income was RMB 126.7 billion in the whole year, or 17.8% increase compared to last year. Amongst, net interests income was RMB 113.1 billion, or 14.8% increase. Other Operating Income is RMB 13.541 billion, an increase of RMB 4.57 billion, or 50.94%. Ratio of other operating income to operating income was up from 8.34% to 10.69%. Income was gradually expanded from traditional customer loan to non-credit business, amongst, intermediary services income was RMB 12.3 billion, or 44.5% increase. Armed with advantageous services as RMB settlement, international settlement and agency services, ICBC put major efforts in developing high-growth, high-tech and high added-value emerging intermediary services markets such as cash management, investment banking, assets custody and various kinds of money management services. Ratio of intermediary services income to operating income was up from 7.92% last year to 9.71%, or 1.79 percentage points increase. From this, it can be concluded that growth in interest income is mainly contributed by steady improvement of the quality in newly-increased loan, structural adjustments to deposits periods and loan periods, as well as the increased operations of funds. Yield rate of interest earning assets in 2004 increased 0.09 percentage points. Difference (interests difference) between interests rate of real income from interests earnings assets and interests rate of real expenditure from interests payable debt increased 0.09 percentage points. Profitability of unit assets and capital was on the rise. Ratio of operating profits and total assets to owner rights raised 0.1 and 8.29 percentage points respectively.

Annual Report also showed that as at end of 2004, ICBC total assets reached RMB 5670.521 billion, RMB 391.410 billion increased compared to same period last year, or 7.41%. Balance of all kinds of loans is RMB 3705.274 billion, RMB 312.337 billion increase or 9.21%, RMB 78.317 billion drop compared to last year. Growth was moderate.

This Annual Report also revealed that in April 2005, State injected USD 15 billion to ICBC and retained the RMB 124 billion (USD 15 billion approximately) of capital fund originated from Ministry of Finance to ICBC to improve ICBC capital structure. At the same time, existing non-performing assets was disposed in accordance with market operation. It is expected that ICBC capital adequacy ratio, non-performing loan rate and reserve allocation coverage rate will be markedly enhanced after financial restructuring.