2016 Annual Report

COMPANY PROFILE
China Banking Corporation (China Bank), stock symbol CHIB, is the first privately-owned
commercial bank in the Philippines, which catered initially to the needs of Chinese-Filipino
businessmen. Established in 1920, it played a key role in post-World War II reconstruction
and economic recovery through its support to businesses and entrepreneurs in critical
industries. It was listed in the local stock exchange in 1927, became the first bank in
Southeast Asia to process deposit accounts online in 1969, and acquired its universal
banking license in 1991.

China Bank offers a complete range of deposit, lending, international, and investment
products and services to corporate, commercial, and retail customers. It also provides
capital raising, merger and acquisition, financial restructuring, debt and securities
underwriting, and economic advisory services through its investment house, China Bank
Capital Corporation (CBCC), and securities brokerage through China Bank Securities. It also
offers bancassurance and insurance brokerage services through its subsidiaries Manulife
China Bank Life Assurance Corporation (MCBL) and China Bank Insurance Brokers, Inc.
(CIBI), respectively,and an array of banking of products and services for the retail and SME
(small and medium enterprises) markets through its thrift bank subsidiary, China Bank
Savings, Inc. (CBS).

With nearly a century of solid financials, strong commitment to personal, quality service,
significant contribution to the country’s financial landscape, and an enduring legacy of
successful partnerships with generations of clients trusting the Bank with their wealth
and future, China Bank remains one of the most respected, trusted, stable and profitable
financial institutions in the country.

MISSION VISION
We will be a leading provider of quality Drawing strength from our rich history,
services consistently delivered to we will be the best, most admired,
institutions, entrepreneurs, and individuals and innovative financial services
here and abroad, to meet their financial institution, partnering with our customers,
needs and exceed their rising expectations. employees, and shareholders in
We will be a primary catalyst in the wealth creation.
creation of wealth for our customers,
driven by a desire to help them succeed,
through a highly motivated team of
competent and empowered professionals, CORE VALUES
guided by in-depth knowledge of their • Integrity
needs and supported by leading-edge • High Performance Standards
technology. We will maintain the highest • Commitment to Quality
ethical standards, sense of responsibility, • Customer Service Focus
and fairness with respect to our customers, • Concern for People
employees, shareholders, and the • Efficiency
communities we serve. • Resourcefulness / Initiative
SCALING GREATER HEIGHTS,
ON A FIRM FOUNDATION
The mountain range in the cover represents the various layers of a strong
foundation historically anchored upon core principles and timeless values that
underpinned the strength of enduring partnerships over several generations.
Upon closer scrutiny, the distinct ridges with the upward slope reflect the
strategic initiatives in the last decade and recent years—strong business
growth across key market segments and core businesses, impactful presence
in capital markets, diversification of revenue streams for a more sustainable
business model, leveraging upon rapid network expansion, enabled by robust
technology platforms and efficient processes, and executed by a customer-centric
organization of competent and empowered professionals—to ensure that China
Bank continues to be relevant to its stakeholders and remain true to its mission to
be a catalyst for wealth creation for its customers and partners.

CONTENTS
IFC Company Profile, Mission, Vision, and Core Values | 1 About the Cover | 2 Performance Highlights |
4 Letter To Stockholders | 8 Operating Highlights | 31 Environmental, Social, and Governance |
68 Awards and Recognition | 70 Board Of Directors | 78 Management Committee | 82 Management
Directory | 84 Financial Statements | 198 China Bank Branches | 210 China Bank Savings Branches |
215 China Bank Off-Branch ATM Directory | 219 Business Offices | 220 Subsidiaries and Affiliates |
223 Products and Services | 224 Investors Information | IBC GRI Standards Reference Claim |

China Bank 1 Annual Report 2016

PERFORMANCE HIGHLIGHTS

2014 2015 2016

FOR THE YEAR (IN THOUSAND PESOS)

Net Interest Income 14,088,747 15,085,184 16,694,195
Non-Interest Income 4,759,277 4,487,142 5,094,746
Operating Income 18,848,024 19,572,326 21,788,941
Provision for Impairment and Credit Losses 440,901 966,574 850,546
Operating Expenses 11,727,211 12,193,207 13,350,873
Net Income Attributable to Equity Holders of the Parent Bank 5,117,832 5,606,666 6,458,296

AT YEAR-END (IN THOUSAND PESOS)

Total Resources 471,220,813 526,826,963 633,198,011
Loan Portfolio (Net) 290,418,730 309,761,777 386,827,300
Investment Securities 59,026,895 71,209,973 98,982,422
Total Deposits 399,301,544 439,265,686 541,583,018
Stockholders’ Equity 56,567,483 59,170,904 63,386,204
Number of Branches 470 517 541
Number of ATMs 661 740 805
Number of Employees 7,245 7,540 8,124

KEY PERFORMANCE INDICATORS (IN %)

PROFITABILITY
Return on Average Equity 9.91 9.62 10.42
Return on Average Assets 1.12 1.17 1.16
Net Interest Margin 3.30 3.37 3.20
Cost to Income Ratio 62.22 62.30 61.27
LIQUIDITY
Liquid Assets to Total Assets 32.89 36.09 34.39
Loans to Deposit Ratio 72.73 70.52 71.43
ASSET QUALITY
Non-Performing Loans (NPL) Ratio 2.24 2.53 1.86
NPL Cover 101.25 87.33 91.00
CAPITALIZATION
Capital Adequacy Ratio (CET 1/Tier 1) 13.95 12.58 11.30
Capital Adequacy Ratio (Total CAR) 14.88 13.50 12.21

SHAREHOLDER INFORMATION
MARKET VALUE
Market Price Per Share (In Pesos) 40.291/ 34.441/ 38.00
Market Capitalization (In Thousand Pesos) 80,671,473 68,958,700 76,077,058
VALUATION
Earnings Per Share (In Pesos) 2.551/ 2.801/ 3.23
Price to Earnings Ratio (x) 15.74 12.30 11.76
Book Value Per Share (In Pesos) 28.251/ 29.561/ 31.66
Price to Book Ratio (x) 1.43 1.17 1.20
DIVIDENDS
Cash Dividends Paid (In Thousand Pesos) 1,589,272 1,716,414 1,853,728
Cash Dividends Per Share (In Pesos) 1.0 1.0 1.0
Cash Payout Ratio (In %) 31.14 33.54 33.06
Cash Dividend Yield (In %) 2.28 2.57 2.72
Stock Dividends Paid (In Thousand Pesos) 1,271,428 1,373,142 1,482,993
Stock Dividends Per Share (In %) 8 8 8

1/
Restated to show the cumulative effects of stock dividends

China Bank 2 Annual Report 2016

NET INCOME RETURN ON EQUITY EARNINGS PER SHARE
In Billion Pesos In % In Pesos
10 14 3.5
12.22

11.31

9
12 3.0

10.42

3.23
8
9.91

9.62
10 2.5

2.80
7

2.55

2.55
6 8 2.0

2.51
6.5
5
5.6

6 1.5
5.1

5.1

4
5.0

3 4 1.0
2
2 0.5
1
0 0 0
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016

CASH DIVIDENDS CASH DIVIDEND YIELD DEPOSITS

In Billion Pesos In % In Billion Pesos
4.0 4.0 600
3.55

3.5 3.5
500

542
2.72

3.0 3.0
2.58

2.57

400
2.28

439
2.5 2.5

399
2.0 2.0 300
354
1.9

1.5 1.5
272
1.7

200
1.6

1.6
1.4

1.0 1.0
100
0.5 0.5

0 0 0
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016

STOCKHOLDERS' EQUITY TOTAL CAR BRANCHES ATM

In Billion Pesos In %
900 900
16.00

100 18
15.39

14.88

90 16 800 800
13.50

805
12.21

80 14 700 700
740

70
12 600 600
661

60
10 500 500
561
63

541
59

50
517
57

511

8 400 400
470

40
45
43

6 300 300
367

30
316

20 4 200 200
10 2 100 100
0 0 0 0
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016

China Bank 3 Annual Report 2016

TO OUR STOCKHOLDERS AND FRIENDS,
In 2016, heightened political uncertainty and weaker domestic under the Duterte government – which augurs well for future
demand weighed down the global economy, which turned in growth and competitiveness were reflected in higher imports of
its weakest performance since the 2008 financial crisis. We capital goods and cut the current account surplus by 92% and
saw signs of a shift in trade and investment policies starting brought the peso exchange rate to P49.81: U$1.00 by year-
with the UK’s vote to exit from the EU and the “America First” end. Despite the rise in fuel prices and pump priming activities,
program of the Trump administration. Within the region, China’s average inflation rate rose to merely 1.8%.
structural pivot towards a more inward-looking growth strategy
anchored on encouraging domestic consumption and reducing Our banking system continued to operate in a highly challenging
reliance on exports was reflected in a more moderate but more and competitive environment, defined by relatively more stringent
sustainable GDP growth. regulatory standards in terms of capital adequacy, corporate
governance, liquidity coverage, and institutional capability
For the Philippines, the GDP growth of 6.8% was anchored on to absorb future shocks and cope with emerging threats,
strong economic fundamentals buoyed by election spending, particularly in the area of cybersecurity. The Bangko Sentral
major investments in infrastructure and manufacturing pursued the liberalization of the banking system in the context
output. Household spending remained a major component of its eventual integration into the ASEAN banking system,
of domestic growth driven by robust remittances from which facilitated the entry of three foreign banks. The BSP
overseas workers. Earnings from export of goods and introduced the interest rate corridor (IRC) last June to improve
services rose 9% partly from the growth in revenues from the transmission of monetary policy, specifically the management
the business processing sectors and uptick in industrial of the system’s liquidity flows and rate setting mechanisms. The
demand. Meanwhile, the creation of two million jobs in 2016 upward adjustment in the US policy rates and capital movements
helped bring down the unemployment rate to 5.5%. The from emerging markets to quality US assets raised volatility in
rise in private sector capital formation, the implementation of the regional money markets over the short term. The banking
PPP projects, and the acceleration of infrastructure spending industry’s assets and deposits expanded steadily by 13% and

Given the challenging business landscape, China Bank

capitalized on opportunities to deepen relationships in the
commercial and SME sectors, nurture the newer branches
into profitability while continuing to expand the network,
and establishing the business support infrastructure
necessary to remain the bank of choice for our clients
and secure our future success.

China Bank 4 Annual Report 2016

14%, respectively, even as excess system liquidity supported faster than industry by 24.19% to P393.74 billion, with significant
the strong growth in loans. Capital levels remained robust as growth across the business segments – corporate, middle
the industry’s average total CAR ratio of 16.15% exceeded the market, and commercial – with a notable 26.50% growth in
regulatory minimum. consumer loans. Investment securities portfolio grew 39.00% to
P98.98 billion and accounted for 15.63% of assets, even as the
Given the challenging business landscape, China Bank capitalized portfolio mix was rebalanced to reduce sensitivity to market risk.
on opportunities to deepen relationships in the commercial and
SME sectors, nurture the newer branches into profitability while Total deposits grew 23.29% to P541.58 billion, of which
continuing to expand the network, and establishing the business 51.04% came from stable, low-cost deposits. China Bank
support infrastructure necessary to remain the bank of choice for returned to the peso market last November with its successful
our clients and secure our future success. P9.59-billion offering of long-term negotiable certificates of
time deposit (LTNCDs), the initial tranche of our P20-billion
As a result of these broad-based initiatives, your Bank was able shelf offering. The proceeds of the LTNCD and the planned
to grow net income by 15.32% to P6.46 billion, for a return on billion stock rights issuance in 2017 is expected to improve
equity (ROE) of 10.42% and return to assets (ROA) of 1.16%. the stability and cost of our asset funding as we pursue our
Total interest revenues grew 13.33% to P21.89 billion, with net medium-term expansion plans.
interest income growing 10.67% to P16.69 billion. Non-interest
revenues grew 13.54% to P5.09 billion, bolstered by the rise Even with the significant growth in China Bank’s loan portfolio,
in trading gains to P918.09 million from P466.83 million due to asset quality showed significant improvement as the absolute
favorable market conditions during the first three quarters of the amount of NPLs declined, reflected in the decline in NPL ratio to
year, complemented by growth in fees from service charges, a better-than-industry 1.86% from 2.53% of the previous year.
bancassurance, remittances, investment banking commissions, Similarly, loan loss cover ratio improved to 91.00% from 87.33%,
trust fees, and gains from sale of foreclosed properties. with the parent ratio improving from 123.07% to 153.10%.
The improvement in the critical metrics of asset quality in part
Total assets grew 20.19% to P633.20 billion for market share reflected the successful integration of Plantersbank into China
4.7%, from 4.5% in the previous year. Gross loan portfolio grew Bank Savings and the subsequent clean up and strengthening
of the savings bank’s balance sheet. Bolstered by the additional The year marked the 10th anniversary of the fastest network
capital infusion of P2.5 billion, on top of its returning to a full- expansion in China Bank’s history, which we then dubbed as
year profit of P233.53 million, CBS is now in a solid foundation “the great leap forward”. From 148 branches at the end of
to scale up on its consumer lending segment and focus into 2006, the China Bank group network ended the year with a
teachers’ loans. CBS is now the fourth largest thrift bank in the combined footprint of 541 branches – of which 391 are in the
country in assets (P81.25 billion), a network of 150 branches, parent bank and 150 in the savings bank subsidiary -- serving
and loan portfolio of P58.23 billion. over 1.4 million customers. Indeed, China Bank Savings alone
with 150 branches has more branches than China Bank 10
Fitch Ratings noted the faster growth in the bank’s consumer years before. While electronic channels and digital platforms
portfolio as reflecting a growing risk appetite, but it took into will become the platforms for competition and customer service
consideration China Bank’s history of conservative management, in the future, the expansion of the physical branch network in
sound asset quality, ample funding & liquidity, and robust a fragmented archipelago remains a critical part of the effort
capitalization in upgrading our Long-Term Issuer Default Rating to reach out to a growing population – 68% of whom still
to ‘BB+’ and Viability Rating to ‘bb+’ with a Stable outlook. This do not have bank accounts -- in an underbanked economy.
upgrade was further affirmed in February 2017. The distribution network remains at the heart of our strategy
to acquire customers, generate low cost funds, and deepen
China Bank’s presence in the capital markets was further customer relationships by providing relevant products and
strengthened with our investment house subsidiary, China Bank services – a sustainable platform to improve cross sell ratios
Capital Corporation (CBCC), generating a net income of P230 and generate fee revenues.
million in its first year of operations, as it actively participated
in major loan syndications. Capturing the largest market share We foresee China Bank’s distribution network expanding to 720
in retail bond issues earned CBCC recognition by The Asset branches and over 1,000 ATMs by 2020, supporting the goal of
Magazine (Hong Kong) in its Triple A Country Awards 2016 doubling our customer base.
as the Best Domestic Bond House for the Philippines. The
increase in CBCC’s authorized capital from P500 million to P2 The rapidly growing distribution network is enabled by a highly
billion, with an additional capital infusion of P500 million, will robust and integrated core banking platform Finacle by Infosys,
enhance CBCC’s capacity to handle the financial advisory, deal rolled out in August 2015 simultaneously in both China Bank and
structuring, capital raising and asset securitization requirements China Bank Savings and later in the Plantersbank branches. The
of its growing clientele. Its acquisition of stock brokerage core banking systems allows real-time access to deposit and loan
firm ATC Securities, to be renamed China Bank Securities balances 24/7, general ledger and management of credit facilities.
Corporation, completes the platform to handle IPO and stock The China Bank Online retail internet portal, was upgraded in July,
trading requirements, while the CBC Assets One (SPC), Inc., a also using e-Finacle by Infosys, to enable greater convenience,
special purpose company, will house its securitization deals. service options, and security of use for our clients.

For the fifth consecutive year, China Bank won

PSE‘s Bell Award for Excellence in Corporate
Governance which annually recognizes the top
five publicly-listed companies that adhere to the
highest measure of corporate governance – the
only bank to be so honored from 2012 to 2016.
HENRY SY, SR.
Honorary Chairman
and Advisor to the Board

China Bank 6 Annual Report 2016

As technology and information security remain key components orientation remains in place. Hence, training and mentoring will
of the Bank’s transaction banking and client servicing strategies, figure prominently in our human resource strategy for the present
China Bank was one of the first banks to adopt the EMV standard and for the future, with our China Bank Academy developing in-
for its ATM & Credit Cards as well as its ATM network. We have house & on-line training programs tailored for each department
made substantial investments in threat intelligence solutions to or function. However, employee development must eventually
protect client transactions and ensure the security and continuity go beyond the training room - into the branch selling area, the
of banking operations. We also deployed touch screen ATMs trading floor, and even the actual client call – so the commitment
with smart phone functionality last November at selected sites to mold our future leaders must come from all levels in the Bank.
for a more user-friendly and convenient banking experience.
More importantly, we laid the groundwork for our digital banking As we commend the China Bank officers and staff for a great
project to transform China Bank into a process efficient and year of results, we strongly exhort them to stay the course as
technologically-driven business that integrates backroom we forge ahead towards our centennial anniversary in 2020.
processing, channel management, customer engagement, and It is with great sadness that we mourn the passing of our
branch redesign initiatives into a coherent banking roadmap. independent director Mr. Dy Tiong in September, and with a
deep sense of appreciation we acknowledge his invaluable
For the fifth consecutive year, China Bank won PSE‘s Bell contribution to China Bank.
Award for Excellence in Corporate Governance which annually
recognizes the top five publicly-listed companies that adhere to We are pleased to welcome new members to the
the highest measure of corporate governance – the only bank to Management Team who will beef up the leadership ranks
be so honored from 2012 to 2016. Similar institutional awards in key businesses and provide the expertise in new ones,
were received such as Banking & Finance Firm of the Year by drawing upon their wealth of experience to bring the Bank to
Finance Monthly (UK), Best Corporate Governance Bank by Global a higher level of performance and continue our tradition to
Banking & Finance Review (UK) and Best Bank Governance become the best partner for our clients.
Philippines 2016 by Capital Finance International (UK) . At the
leadership level, Chairman Hans Sy was conferred the Asian On behalf of our colleagues on the Board, we thank our clients,
Corporate Director Recognition Award by Corporate Governance shareholders, and employees for their support throughout the
Asia, while President & CEO Ricardo Chua was given the Asia years, and we hope to be a cornerstone of their success as we
Pacific Entrepreneurship Award (APEA) by Enterprise Asia. move closer to our centennial year in 2020.

These awards are a testament to the Bank’s commitment to high

standards of performance for our customers and shareholders,
and to be a socially responsible institution. In light of this, the
Bank’s corporate social responsibility (CSR) policy was enhanced
and approved in 2016, under the environmental, social, and
governance (ESG) framework.

We have put in place a growing physical network, technology

infrastructure and digital platforms as key pieces of a solid
foundation for sustainable business growth. Leveraging upon HANS T. SY
Chairman of the Board & the Executive Committee
this foundation, our P15 billion stock rights offering will provide
the capital strength to sustain the momentum of our grown in all
key segments, take advantage of opportunities in an emerging
economy with strong fundamentals and great potential for growth
while having the capacity to handle the challenges of a rapidly
GILBERT U. DEE
changing economy and competitive landscape. Vice Chairman

At the heart of our growth strategy is the distinct China Bank

culture and emphasis on our DNA as a relationship bank. As
the China Bank family grows to over 8,000 officers & staff
members, we must ensure that our unique “brand” based on RICARDO R. CHUA
President & Chief Executive Officer
work competency, entrepreneurial mindset and customer service

China Bank 7 Annual Report 2016

 OPERATING
HIGHLIGHTS

LAYING THE FOUNDATIONS

FOR SUSTAINABLE GROWTH

Fitch Ratings China Bank Savings China Bank Fortified the China Bank was
upgraded China achieved full-year won Best Bond organization with key awarded with its
Bank's long-term profitability House – Domestic, talent acquisition fifth Philippine Stock
IDR to BB+ Philippines at the Exchange Bell award
Triple A Country in a row
awards

China Bank 8 Annual Report 2016

 OPERATING HIGHLIGHTS

China Bank 9 Annual Report 2016

OPERATING HIGHLIGHTS

LAYING THE FOUNDATIONS

FOR SUSTAINABLE GROWTH
The year 2016 saw China Bank celebrate its 96th anniversary
replete with corporate milestones that made it another
remarkable year.

The Bank maintained its focus on building a customer centric

organization and building on the foundations for sustainability,
as well as laying the groundwork to be able to compete in
the digital banking sphere. Throughout the year, the Bank
continued to expand its branch network, strengthen its
manpower with highly skilled professionals, enhance its
technological platforms, and enter into new business lines.
This focus is anchored on three engines of growth:
1) Relationship Banking; 2) Financial Markets;
and 3) Subsidiaries and affiliates.

China Bank 10 Annual Report 2016

 CORPORATE MILESTONES
Fitch Ratings' upgrade to BB+
International credit rating agency Fitch Ratings has upgraded the Long-Term Issuer
Default Rating of China Bank to 'BB+' from 'BB' and its Viability Ratings to 'bb+' from
'bb' with Stable outlook. This was later affirmed by Fitch in February 2017.

China Bank Savings' profitability and capital infusion

China Bank Savings, the thrift banking subsidiary of China Bank, turned around to
profitability in 2016. The Parent Bank infused an additional P2.5 billion in capital to CBS to
further boost business growth and accelerate its contribution to group profitability.

First full-year operations of China Bank Capital

Investment banking subsidiary China Bank Capital completed its maiden year of
operations as market leader in retail bond issues. It garnered the biggest market share
ahead of the big three investment houses in the country. It also won Best Bond House
—Domestic, Philippines at the Triple A Country awards presented by Hong Kong-based
journal, The Asset, and Best Bank for Domestic Debt Capital Markets Philippines from
London-based publication Global Banking & Finance Review.

Strong organization with key talent acquisition

China Bank officers are reputed in the industry to be better skilled, dynamic, and willing
to perform multi-tasking work. The service oriented culture is ingrained in the employees'
systems, allowing the institution to thrive in the face of tough challenges.

Excellence in governance awards

China Bank won many awards on corporate governance in 2016, including an
unprecedented fifth Philippine Stock Exchange Bell Award for Corporate Governance in
a row. It is the highest honor bestowed by the institution to publicly listed companies that
adhere to high standards of corporate governance. China Bank remains to be the only
bank and the only listed company to have won five consecutive times. (For more of China
Bank's awards, see page 68.)

China Bank 11 Annual Report 2016

OPERATING HIGHLIGHTS

FINANCIAL PERFORMANCE
China Bank posted a 15% growth in net income to P6.46 billion in 2016, reflecting
sustained growth in core businesses across all market segments. This translates to a
return on equity of 10.42% and return on assets of 1.16%.

Net interest income grew 11% to P16.69 billion, driven by the 13% rise in interest
revenue from loans to P17.89 billion. Fee-based revenues improved 14% to P5.09
billion, bolstered by trading gains of P918.09 million and robust growth in revenues
from service charges and fees, trust fees and gains on sale of acquired assets.
Operating expense growth was limited to 8% even with the continued expansion in
distribution network and investments in people and technology to support the growth
of new businesses.

Total assets grew 20% to P633.20 billion, as loans and deposits grew faster
than industry. Gross loans rose 24% to P393.74 billion, led by the 27% growth in
consumer loans. Total deposits rose 23% to P541.58 billion, with the 21% growth
in low-cost CASA deposits to P276.42 billion reflecting the strength of the China
Bank franchise boosted by deposit growth from new branches. CASA ratio stood at
51.04%, while loans-to-deposit ratio stood at 71.43%.

Total capital funds reached P63.39 billion, resulting in Common Equity Tier 1 (CET 1)
at 11.30% and Total CAR 12.21%.

BALANCE SHEET HIGHLIGHTS

NET INCOME TOTAL ASSETS

P6.46B P633.20B
Increased by 15% Increased by 20%

GROSS LOANS TOTAL DEPOSITS RETURN ON EQUITY

P393.74B P541.58B 10.42%

Increased by 24% Increased by 23% Increased from
9.62%

China Bank 12 Annual Report 2016

 GROWING OUR BASE
Aligned with our core strategy to reach more markets and acquire new clients and
partners, China Bank opened 39 branches in 2016—ending the year with a total
network of 391 branches in strategic locations (541 including CBS branches). It
also deployed 65 automated teller machines, bringing the total number of ATMs to
805, including those of CBS. We ended the year with 1.46 million customers.

OUR REACH

China Bank China Bank Savings

1.46M 1.17M 295K

CUSTOMERS

541 391 150

TOTAL BRANCH
NETWORK

805 652 153

ATMs

8,124 6,155 1,969

TOTAL EMPLOYEES

China Bank 13 Annual Report 2016

OPERATING HIGHLIGHTS

RELATIONSHIP RETAIL / BRANCH BANKING

BANKING
China Bank offers a complete range of deposit, lending, international, and investment
banking products and services to corporate, commercial, and retail customers.
Its commitment to cultivate stronger relationships and enduring partnerships
with its clients has prompted China Bank to embark on a journey of rapid branch
expansion, development of new market bases, and an image enhancement project to
complement the organizational progress that was occurring within.

In the last decade, China Bank has been on an upward trajectory in key result areas.
The organization is now almost four times bigger compared to 10 years ago. Its thrift
banking arm China Bank Savings alone has 150 branches today, which is bigger than
the Parent Bank China Bank 10 years ago with only 148 branches.

Through all this fast-paced development, China Bank remains committed to the same
objectives of acquiring customers, deepening relationships, and striving to be the
best bank for its clients while setting its sights on new goals: shifting its focus to a
segmented strategy that maximizes presence and returns from our targeted markets,
strengthening of balance sheet and improved profitability, capitalizing on process and
technology upgrades to achieve operational efficiency, and creating an organization
that adapts to change.

China Bank 14 Annual Report 2016

 The Bank will continue to focus on marketing consumer products through cross-
selling initiatives and promotions. Last but not least, in order to achieve maximum
operational efficiency, the Bank will embark on its biggest project to date – to
undergo digital transformation – which would enable the Bank to compete in the
digital banking sphere.

China Bank is one of the first banks to comply with the BSP's directive to convert
all ATM cards to EMV (Europay, Mastercard, and Visa) standard by end of year.
EMV is the most recent advancement in automated banking to help combat fraud
and protect its users’ payment data. Other benefits include improved transaction
security whether through ATM or point-of-sale terminal; added layers of protection
as EMV addresses the threat of skimming or counterfeit fraud type, and assured
adherence to international standards for card payments.

In July 2016, the Bank’s personal online banking portal, China Bank Online, was
upgraded to allow customers to transact online with greater ease and security. With
the new platform, users experience a simpler way of managing their accounts and
enjoy added security. Other benefits of the upgrade include being able to instantly
view one’s accounts and transaction history, apply for insurance coverage, use the
built-in loan calculator, and personalize one’s own homepage.

Also in 2016, in a first-in-country unveiling, China Bank introduced a new ATM user
experience wherein the machine mimics the interface of a smartphone, resulting in
a more interactive and user-friendly touch system and transactions that are shorter,
faster, and like before, secure. This is set to transform the user interface landscape
of self-service banking in the country and will be the de facto standard for all banks
in the future.

RETAIL BANKING BUSINESS SEGMENT

(L-R) Stephen Y. Tan, Clara C. Sy, Noemi L. Uy, Shirley C. Lee, Elizabeth C. Say, Manuel M. Te,
Mandrake P. Medina, Madelyn V. Fontanilla, Danilo T. Sarita, Shirley G. K. Tan, and Henry D. Sia

China Bank 15 Annual Report 2016

OPERATING HIGHLIGHTS

CONSUMER BANKING
REAL ESTATE AND VEHICLE LOANS
19% China Bank’s real estate loans grew by 19% in 2016. The bulk of the growth came from
REAL ESTATE the developer referred channel, which grew by a hefty 58%. This may be attributed to
LOANS an improved market visibility with the group’s active participation in events hosted by real
estate associations and developers, housing fairs and open houses, and brokers’ nights.
21%
VEHICLE
LOANS The collaboration of the Consumer Banking Group (CBG) with China Bank Capital
Corporation, the Bank’s investment house subsidiary, resulted in P1.69 billion worth of
new loans to developers.

China Bank’s vehicle loans portfolio grew by a significant 21%, with new loans growing
by 26% backed by active branch referrals. China Bank branches consistently gave
positive feedback on the service turnaround time.

Past due levels were kept within limits, and the basic principles of prudent credit
underwriting were observed.

REMITTANCES
2016 was a banner year for China Bank’s Remittance Business Division. Aside from
marking its 10th year in the remittance business, it has reached a major milestone in terms
of volume of transactions as it exceeded the US$1 billion mark, placing it amongst the
industry’s major players. Business volume increased by 53% versus 2015 levels while
transaction count increased by 33%. The Bank now enjoys 31% market share in the
Kingdom of Saudi Arabia, which is home to 1.2 million overseas Filipinos. The March 2016
trip to the Kingdom by EVP and COO William C. Whang, together with the heads of the
Division, strengthened our relationships with key strategic partners in Saudi Arabia.

In terms of products and services, the main thrust of the Bank’s remittance team is to
encourage overseas Filipinos (both land-based and sea-based) and their beneficiaries
to utilize and take advantage of the Overseas Kababayan Savings Account. In line with
the BSP’s vision for inclusion, this deposit account does not require initial deposit and
maintaining balance, a perfect instrument for overseas Filipino families to start and manage
their savings which they can use to invest or start a business.

Cash Pick-up, on the other hand, remains to be a preferred service given by China Bank’s
vast network of payout channels through its own branches as well as China Bank Savings,
MLhuillier, Cebuana Lhuillier, Palawan Pawnshop, LBC, and SM Global Pinoy Centers.

China Bank remains compliant with the Anti-Money Laundering Act in the performance of
the above-stated services.

China Bank 16 Annual Report 2016

 CREDIT CARDS
2016 marked the second year of the credit card issuing business of China Bank. The year
47,000
CARDS ended with 47,000 issued cards and P4.58 billion in gross billings, up by 210% from 2015.
ISSUED
The increase in cards issued was supported by acquisition campaigns which focused
P4.58 mainly on branch clients. The “Free for Five” promo was launched in March, and the
billion “Free for Life” promo in July. Both programs offered free annual fees for life as long as the
IN GROSS
BILLINGS approved cardholders are able to meet the spending requirements. At the same time,
Branch Referral Programs (BRP) such as “Refer and Win a Trip to Singapore”, “Ready,
Take Charge for 600k”, and “Thrice the Prize” were launched to support the new card
acquisition campaign. The credit card division recognized and awarded the top branch
performers for the year.

Card usage programs for the year focused on tactical themes. We started 2016 with a
Chinese New Year promo wherein we partnered with various merchants such as AirAsia
Philippines, EDSA Shangri-La, and Sincerity Café and Restaurant, to name a few. For
Valentine’s Day and Mother’s Day, Miladay and Island Rose offered special discounts to
China Bank MasterCard cardholders. Another big promotion was the Mid-Autumn Festival
Raffle wherein three lucky cardholders won a Prada, Gucci, or Balenciaga bag.

The major usage campaign for 2016 was the “Priceless Las Vegas” raffle promo which
was launched in October 2016. Every P2,000 single receipt purchase or charge gave the
cardholder one raffle entry for a chance to win a trip to Las Vegas for two.

Other usage highlights include the 0% installment programs with SM, Lazada 11.11 Online
Revolution, Zalora 12.12 Online Fever, and Platinum and World MasterCard exclusives with
Jewelmer and Fairmont Makati.

In 2017, the credit card division aims to offer more benefits to its growing number of
cardholders by offering a more robust and inclusive set of programs.

China Bank 17 Annual Report 2016

OPERATING HIGHLIGHTS

LENDING
INSTITUTIONAL / CORPORATE BANKING
China Bank continued to reinforce its presence in the corporate market in 2016
with major accounts ranging from expanding business segments, such as power
and utility, PPP projects, telecommunications, mining, and logistics. It forged ahead
with its service to corporate clients through its cash management businesses, and
defended its market share for small-and-medium scale enterprises (SMEs), as well as
the middle market and commercial ones by addressing their funding requirements.
The Institutional Banking Group sought for opportunities for long-term financing,
and pursued point-of-sale terminal cash-out services and corporate auto-debit
arrangements with several banking partners.

CASH MANAGEMENT SERVICES

The year 2016 was a successful year for Cash Management Services Division (CMSD) as
the team completed several milestone projects and achievements for China Bank. CMSD
achieved its goals of CASA deposits and the resources attributable to CMSD initiatives.

In September, CMSD and power company Meralco sealed a new partnership for an Auto
Debit Arrangement, which allows corporate customers to pay their Meralco bills with
a facility designed to automate and streamline the manual processing, consolidation,
and fulfillment of bills. In the same month, another Auto Debit Arrangement deal was
closed—this time with SM Development Corporation (SMDC)—which allows SMDC unit
buyers to conveniently pay their monthly amortizations via debit from their enrolled China
Bank account. Currently, this is available only to China Bank employees, but SMDC
plans to expand this facility to all their customers by 2017.

In December, CMSD and Universal Storefront Services Corporation (USSC) implemented a

facility called POS Cash Out, allowing all ATM account holders of BancNet-member banks
to withdraw cash through point-of-sale devices located USSC branches.

INSTITUTIONAL BANKING GROUP

(Standing L - R) Luis M. Afable,
Layne Y. Arpon, Gerard Majella
T. Dee, Victor O. Martinez,
Christopher P. Chua, and Betty L. Biunas
(Seated) Lilian Yu, Domingo P. Dayro,
and Cristina F. Gotuaco

China Bank 18 Annual Report 2016

 CMSD is about to implement the new-generation internet banking platform for
the business clients of China Bank, which will provide corporate customers with
increased processing capability, more intuitive user experience, and a refreshing new
layout. Included in this project are three major innovations: a mobile app that can be
used for approving transactions, a second factor authentication for a more secure
environment, and an invoice management module which allows a community of
buyers and sellers to settle and reconcile invoices online.

In September 2016, CMSD was awarded by the Social Security System (SSS) as
Best Collecting Partner Bank, a distinction that is awarded to financial institutions with
the highest collections, the biggest volume of transactions, and the widest coverage
for the year. In 2016, China Bank has garnered a total collection volume of P3.88
billion for the SSS.

China Bank 19 Annual Report 2016

OPERATING HIGHLIGHTS

FINANCIAL CHINA BANK CAPITAL CORPORATION

AND CHINA BANK SECURITIES CORPORATION*
MARKETS China Bank Capital Corporation, the wholly-owned investment house of China
Bank, completed its maiden year of operations in 2016 and established two
new subsidiaries: a stock brokerage house and a special purpose corporation. It
reported a performance revenue of P385.24 million for full-year 2016.

The stock brokerage house, which will be named China Bank Securities
Corporation, enables China Bank Capital to do Initial Public Offerings (IPOs) and
list these IPO shares in the Philippine Stock Exchange. The China Bank Group’s
clients will also gain access to stock brokerage services for their equities-related
transactions.

The special purpose corporation known as CBC Assets One (SPC), Inc. will be
utilized as a vehicle to hold the assets for the securitization transactions of China
Bank Capital. Early in 2016, China Bank Capital was mandated by listed property
developer 8990 Holdings, Inc. to be the Arranger and Lead Underwriter for the P5
billion securitization of Contract To Sell (CTS) receivables of its various subsidiaries –
which, when completed, will be the largest securitization transaction in the country.
The receivables will be purchased by CBC Assets One (SPC) Inc., and repackaged
into fixed-income securities. This is an innovative approach by China Bank Capital to
address the financing requirements of the low-cost housing industry. The addition of
these two new subsidiaries to China Bank Capital’s portfolio rounds out its offerings
and helps improve its capabilities on the capital origination side.

The investment house participated in numerous landmark transactions in 2016,

most notably as Sole Issue Manager, Sole Bookrunner, and Joint Lead Underwriter
for the P7 billion Fixed Retail Bonds issued by Ayala Land, Inc. as well as being
mandated Lead Arranger and Bookrunner for the Cebu Pacific P3.99 billion Term
Loan Facility.

CHINA BANK CAPITAL

CORPORATION AND
CHINA BANK SECURITIES
CORPORATION
(L-R) Ryan Martin L. Tapia,
Charles A. Gamo,
Manolo C. San Diego,
and Peter M. Mutuc

*Currently known as ATC Securities Inc. pending SEC approval of change of name.

China Bank 20 Annual Report 2016

 To cap a positively eventful year, China Bank Capital was hailed “Best Bond House—
Domestic” at the Triple A Country Awards presented by regional journal The Asset,
and “Best Bank for Domestic Debt Capital Markets” by London-based publication
Global Banking & Finance Review. These awards are fully supported by actual
performance: its third quarter report to the Board of Directors noted that for the
period January-September 2016, China Bank Capital generated the largest volume of
retail bond issues (public debt instruments) with P16.77 billion from the most number
of issues (7). As a result, China Bank Capital garnered the largest market share with
27.94%, ahead of the big three investment houses with market shares of 18.3%,
16.7% and 13.9%.

With this performance, we are able to demonstrate China Bank’s institutional

capability: a good organization staffed by competent and knowledgeable
professionals that do more for our corporate and business clients (origination side)
and our depositor/investor base (distribution side).

For our business and corporate clients, China Bank is a full-service partner with
the competence to advise them on how to enable business growth with the right
mix of loans, bonds and equity, in a manner that reflects how well we understand
their businesses, their unique circumstances, the challenges they face and the
opportunities they can utilize. We are fully able to support our customers with a wider
range of services, from sound advise to a complete set of financing services.

To our depositors, this means being able to generate a wider variety of investment
instruments that we can make available to our customers to diversify their investment
portfolios without having to rely on other banks or investment houses.

China Bank 21 Annual Report 2016

OPERATING HIGHLIGHTS

WEALTH MANAGEMENT
In 2016, our team of seasoned and dedicated Relationship Managers continued to
give our affluent customers a more rewarding preferred banking experience. With the
success of last year’s strategies and management systems, our internal units have been
able to better support our expanded services. This leverage has allowed us to reinforce
the business model with more robust product platforms and more efficient processes.

Our client-centric approach such as providing “on call” relationship managers and
adopting an open-architecture banking platform continue to bolster our Wealth
Management Group (WMG), allowing them to improve on their well-established
personalized service programs, and continue delivering the best-in-class banking
solutions in tandem with China Bank’s products to optimize each customer’s portfolio.

This year’s positive outlook gained much from China Bank’s SOPRA Wealth
Management System—a client management platform initiated in the previous year
that introduced enhanced processes tailored to be more responsive to our clients’
needs. Our private bankers also leveraged on investment banking as well as external
counterparties to provide vastly improved product solutions.

As part of our efforts to reach out to more wealth management clients, we expanded
our regional presence since the previous year, including the establishment of a new
wealth management center in Bacolod and the expansion of our Alabang Cluster’s
coverage to include Batangas.

WEALTH MANAGEMENT
(L-R) Angela D. Cruz
and Cesaré Edwin M. Garcia

China Bank 22 Annual Report 2016

 TREASURY
The year saw the Treasury Group undergo a major change in its organizational structure
alongside the entry of several key officers to lead the trading and sales units. The changes
were aligned with the Group’s renewed focus on the distribution desks to tap a broader
and growing market for securities and investments. To achieve this goal, the various sales
desks covering fixed-income securities and foreign exchange – catering to both retail and
institutional clients – were consolidated under a single sales cluster complete with its own
middle office and brokerage units. The addition of these support units will serve to ensure
smooth day-to-day operations by unburdening the frontline personnel with operational
concerns while also complying with regulatory requirements.

The Group continued to play an active role in the fixed income market, participating
in almost all of the major private and government bond issuances through aggressive
origination efforts of the Bank’s investment house subsidiary. Apart from corporate
bonds issued by the country’s top corporations, the unit was also one of six selling
agents of the P100 billion 25-year retail treasury bonds (RTB 10-5) issued by the
Bureau of Treasury during the third quarter of 2016. Given stepped-up trading activities
in the primary and secondary markets, the Group was recognized as one of the top
performing Government Securities Eligible Dealers (GSED) by the Bureau of Treasury
and by the Philippine Dealing System in terms of brokering and sales activities which
ranked it as number 9th and 5th respectively in 2016.

To keep pace with the growing need for financial instruments, the group likewise
expanded the list of accredited counterparties and allowable investment outlets,
including the review and increase in counterparty lines and limits.

Meanwhile, the implementation of the new treasury platform using Calypso will be fully
operational by the second quarter of 2017. The new system which covers front, middle
and back end is expected to support the growing treasury operations, enhance trading
capabilities, and improve flexibility and speed to adapt to regulatory changes and new
business trends.

TREASURY GROUP
(L-R) Jerry Ron T. Hao, Cristina C. Hernandez,
Marisol M. Teodoro, Cristina P. Arceo,
and Filemon Cecilio A. Cabungcal

China Bank 23 Annual Report 2016

OPERATING HIGHLIGHTS

Overall, the Treasury Group remained as a major contributor to the Bank’s bottom
line and is expected to continue to do so with the implementation of vital structural
changes and revitalized sales and distribution efforts.

TRUST AND ASSET MANAGEMENT

The China Bank Trust and Asset Management Group is one of the leaders in the country
today, with Assets Under Management (AUM) growing by 30% to P102.73 billion, one of
the highest growths recorded in the industry. We ended 2016 ranked fourth* in terms of
AUM among privately-owned local banks—two notches higher than last year.

The Trust Group continues to provide customized solutions to meet our clients’
unique financial needs through a full set of Unit Investment Trust Funds (UITFs),
investment management service, and corporate trust services.

We remain committed to our disciplined investment processes to ensure optimal

performance of our UITFs. In 2016, our funds have consistently performed in the
upper quartile of their respective categories. In fact, our Dollar Fund was awarded
Best Managed Fund of the Year for the USD Long Term Bond Fund category by the
CFA Society Philippines.

CHINA BANK FUNDS RANKING

AUM (in billion PhP)
Short-Term 1 out of 28
2016 103B Intermediate Fixed Income 1 out of 9
2015 79B Equity 1 out of 28
Dollar 1 out of 8

TRUST & ASSET

MANAGEMENT GROUP
(L-R) Norman del Carmen,
Carina L. Yandoc,
and Gemma B. Deladia

*Source: UITF.com.ph

China Bank 24 Annual Report 2016

 OPERATIONS AND SUPPORT

Business Operations
The Bank’s Business Operations Group is comprised of Loans and Discounts,
International Banking, Remittance Operations, and Treasury Operations that provide
the operations and documentation support for the Relationship Banking and Financial
Markets segments. This Group focuses on the consistent and timely delivery of
services based on established service level standards that were designed to enhance
the Bank’s transaction turnaround times, process efficiency and cost competitiveness.
The revenue generating segments also rely on the Business Operations Groups in
achieving their customer retention and profitability targets.

Corporate Support
The Bank’s Corporate Support Group is comprised of Information Technology, Credit
Management, Human Resources, Legal and Collection, Alternative Channels and
Administrative Division. This group manages the Bank’s substantial investments in IT
infrastructure for service efficiency and central customer database, credit support,
employee development, organization development, legal efficiency, and logistics.
The Bank expects to capitalize on its shared platform of support services across its
business groups and units to sustain competitiveness and profitability.

The Bank also provides a wide range of other services through its Financial
Management, Risk Management, Office of the Corporate Secretary, Compliance,
Audit, Information Security, Security Office, and Investor and Corporate Relations.

OPERATIONS AND
SUPPORT GROUPS
(L-R) Belenette C. Tan, Richard
S. Borja, Dorothy T. Maceda,
Virginia Y. Uy, Wilfredo L. Sy,
Ma. Luz B. Favis, Marie Carolina
L. Chua, Melissa F. Corpus,
Francisco Eduardo A. Sarmiento

China Bank 25 Annual Report 2016

OPERATING HIGHLIGHTS

SUBSIDIARIES CHINA BANK SAVINGS, INC.

China Bank Savings (CBS) concludes its ninth year by achieving a turnaround to
AND AFFILIATES become a profitable thrift bank arm of the China Bank Group. The business has
sustained a momentum of growth and created a new market for China Bank.

CBS is now the country’s fourth largest thrift bank given an asset size of P81
billion, 9% higher year-on-year. The savings bank ranked fourth and fifth in terms
of deposits and net loans which expanded by 8% to P72 billion and 14% to P58
billion, respectively. The increase in capital of P2.5 billion will support the expansion
of CBS into new market segments.

By providing wealth-building, innovative products and services to the broad

Consumer and Small and Medium Enterprise (SME) market, CBS contributes
to financial inclusiveness and improving the quality of life of clients and the
communities where the Bank operates. The year 2016 saw the rapid advance of
Department of Education Loan operations allowing CBS to tap a potential market
of over 300,000 public school teachers and DepEd personnel in five regions,
including SOCCSKSARGEN in Mindanao.

China Bank 26 Annual Report 2016

 The Bank’s successful partnership with Manulife China Bank Life Assurance
Corporation (MCBLife) resulted in significant fee income from bancassurance
sales. The Bank continues to evolve its service menu to distribute sachet-type
insurance products for short to long-term needs—from protection, health cover
and retirement to investments with a life insurance component.

CBS aims to grow its brick-and-mortar presence in locations accessible to people

in the community, including supermarkets and community malls, and through
secure and convenient electronic, mobile and online banking channels. The Bank
ended the year with 150 branches. It focused on expanding to new areas and
consolidating branches in the provinces to effectively service its chosen markets.

CBS launched new promos and products like exclusive Affordabundle and
Buyout Promo offers for DepEd Loan clients, ROPAnalo promo to push disposal
of acquired assets, LENDR online consumer finance platform, and EMV cards. It
is also presently migrating to the new Finacle Core Banking Solution (FCBS) to
improve processes and customer experience.

CBS launched its Social Media Engagement initiative on Facebook to reach out to
the highly-engaged, mobile-first market segment. The campaign aimed to boost
consumer confidence in our brand, encourage foot traffic to brick-and-mortar
branches and drum up interest in deposit and consumer offers like CBS home and
auto loans. The initiative is attributed to having increased the number of likes on
the CBS Facebook page by 800% within one month of the February 2016 launch.

CHINA BANK SAVINGS, INC.

(Standing L-R) Jose F. Acetre,
Maria Teresita R. Dean, Jan Nikolai
M. Lim, Lani D. Larion, Adonis C.
Yap, Maria Lilibeth C. Paradero,
Luis Bernardo F. Puhawan and
James Christian T. Dee.
(Seated) Sonia B. Ostrea and
Neliza Ma. R. Oñate

China Bank 27 Annual Report 2016

OPERATING HIGHLIGHTS

MANULIFE CHINA BANK LIFE ASSURANCE CORPORATION (MCBLife)

Manulife China Bank Life Assurance Corporation (MCBLife) is the bancassurance
affiliate of China Bank, which was formed when the Bank entered into a strategic
partnership with Manulife Philippines in 2007. This gave our clients direct access to
innovative financial solutions and products that can help them achieve protection and
financial growth. In 2014, China Bank raised its equity stake in MCBLife to 40%.

For 2016, MCBLife posted the highest growth at 48% versus its competitors. In terms
of groups of companies, Manulife + MCBLife ranks third in premium income ranking,
next only to Philam Life + BPI PhiLAC and Sun Life + Sun Life Grepa.

In 2016, MCBLife made life insurance more affordable with the launch of
SURESecure, a product available in China Bank Savings branches that provides life
insurance coverage for one year for an annual premium of P299. Benefits include
coverage worth P10,000 in the event of death of total or permanent disability, and
P30,000 in the event of accidental death and dismemberment. Individuals between
18 and 60 years can avail of SURESecure and are eligible for life insurance coverage
without having to go through a medical examination. The product can also be
purchased as a gift to loved ones.

CHINABANK INSURANCE
BROKERS, INC. AND
MANULIFE CHINA BANK LIFE
ASSURANCE CORPORATION
(L-R) Julieta P. Guanlao and
Regina Karla F. Libatique

China Bank 28 Annual Report 2016

 2016 also saw MCBLife start a partnership with actor Richard Yap as its brand
ambassador. A respected actor, successful family man, and devoted family man, he
is the embodiment of many of MCBLife customers’ aspirations. Apart from being an
actor, he is also a serial entrepreneur with several restaurants and a pet grooming
shop under his name. He was also brand ambassador of Manulife Philippines for
three years.

CHINABANK INSURANCE BROKERS, INC.

Established in 1998 as a wholly-owned subsidiary of China Bank providing direct
insurance broking for retail and corporate customers, Chinabank Insurance Brokers
increase in profit margin to 41% for 2016. It continued to lay the groundwork for its
growth, including redistribution of insurance portfolio among preferred insurance
companies, systems and manpower development, and strengthened branches in
Cebu, Davao, and South Luzon. It also added two new departments to its structure
which are now fully operational: the Business Development department and the
Operations department. Its current projects include a systems upgrade to be able to
improve customer service and operational efficiency.

CHINA BANK PROPERTIES AND COMPUTER CENTER, INC.

CBC Properties and Computer Center, Inc. (PCCI ) manages the Bank’s electronic
banking and e-commerce requirements, including sourcing, developing and
maintaining software and hardware, financial systems, access devices and networks
to foster the safety and soundness of China Bank’s technology infrastructure and
keep its processing capabilities in top shape.

CHINA BANK PROPERTIES AND

COMPUTER CENTER, INC.
(Standing L-R) Augusto P. Samonte,
and Phillip M. Tan
(Seated) Editha N. Young

China Bank 29 Annual Report 2016

China Bank 30 Annual Report 2016
 ENVIRONMENTAL,
SOCIAL, AND
GOVERNANCE

SUSTAINABLE BANKING

China Bank for the last 96 years of its journey served as a partner
in the wealth creation of its customers while helping the nation as
well in building a strong and sustainable banking industry.

As China Bank seeks to create a more adaptive banking landscape

for its customers that generate shareholder's value while protecting
the stakeholders, we are utilizing a sustainable reporting model
taking the ESG framework as a guide.

Towards this commitment, we seek to highlight in this report our

key performance indicators on environmental and social activities
and our good governance policies and practices.

China Bank 31 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Our focus on ESG (Environmental, Social, Governance) China Bank values partnerships by engaging or involving
is anchored on the fundamentals and guiding principles itself in various industry and cause-oriented associations
of the Bank where China Bank commits itself to such as Banking Association of the Philippines, Bankers'
responsive, principled banking and good corporate Institute of the Philippines, CFA Society Philippines,
governance that will create value to its shareholders Financial Executives Institute of the Philippines,
and uphold positive transformation among its various Philippine Association of National Advertisers, Trust
stakeholders, through a comprehensive approach Officers Association of the Philippines, and United
to corporate social responsibility and environmental Nations International Strategy for Disaster Reduction
awareness that is consistent with its core values, (UNISDR) - ARISE.
mission and vision statement.
Human Resources
China Bank is one of the first companies in the
country—spearheaded by SM Investments, Inc. (SMIC), China Bank has always prided itself for its genuine concern
the holding company of the SM conglomerate—to adopt for people. While we place the utmost importance on
the ESG consciousness in our business operations. customer and client service, we give the same degree of
SMIC prepared and published a consolidated ESG care and support to our staff and employees. As one of
Report in January 2016, which gave an account the key drivers in increasing our shareholder value, we
of the business model and practices of the various ensure that our employment policies and employee support
companies under the SM Group, that create value for all systems are held to the highest of standards, supported
its stakeholders, focusing on key areas: environmental by the best practices in the human resources industry.
sustainability, social impact and governance. The Aside from adopting efficient and thorough recruitment
framework is modeled from highly sustainable processes, inclusive development opportunities, and
companies worldwide that have begun to embrace this focused retention programs, we strive to create a
paradigm, and we believe that the rest of the country harmonious work environment to maximize the potential
will follow suit in our thrust to conduct a business that is of our employees. With China Bank’s dedication to its
holistically beneficial to all our stakeholders. personnel, it establishes a measure of prestige befitting an
employer that the country’s finest professionals would be
The Bank integrates social, environmental, and governance proud to serve.
practices into its day-to-day business activities to
maintain a balance between its business interests and its To effectively support the Bank’s rapid business growth,
stakeholders’ welfare. China Bank has been promoting capital ventures, and branch expansion, the China Bank
financial inclusion, sustainable finance, environmental group hired 1,939 employees, closing the year 2016
protection, and social development, and continues to with a total of an 8,124-strong workforce group-wide.
engage its employees and partners with customers, They represent some of the best and most talented
various community groups, and charitable organizations young professionals in the industry, bringing with them
to support causes that serve the interests and the needs diverse skill sets and fresh new perspectives. Together,
of society as a whole, and help provide solutions to they are the pioneers that will set the pace for the Bank’s
economic, social, and environmental challenges. continued growth.

China Bank 32 Annual Report 2016

RECRUITMENT The Human Resources Division (HRD) regularly reviews its
Our recruitment policies ensure that the individuals we salary administration programs and proposes salary range
tap are both highly capable and show great promise to adjustments that align with current industry standards,
become even better professionals. Our hiring process subject to Board approval. Opportunities for pay increases
selects candidates of the highest caliber who meet with coincide with the Bank’s performance during the year.
stringent qualification requirements. Current employees Promotions, merit increases, profit sharing, and performance
are also offered the chance to apply for vacant positions. bonuses are dependent on the individual employees’
In this way, we practice an equal opportunity hiring system performance rating and contributions to the Bank.
that considers the most qualified applicants regardless
of origin. Employment and appointment of officer level On top of salary, our remuneration package includes fringe
employees are subject to strict compliance with policies, benefits including medical, dental, and hospitalization
rules and regulations set by the BSP. Furthermore, programs, car plan (for officers), financial assistance
the Bank ensures that employees are placed properly programs (e.g. housing, car, appliance, and personal
through target selection, competency-based training, loans), employee retirement plan, leave privileges (vacation
development, and succession planning. leave, sick leave, maternity/paternity leave, study leave,
and other leaves mandated by law), group life and
COMPENSATION AND BENEFITS accident insurance coverage, rice subsidy, meal and travel
China Bank greatly values its employees and ensures allowances, and bank uniforms.
that they are well-provided for, most prominently
with competitive compensation packages. Our salary The inclusive and comprehensive scope of our
range complies with industry standards, while also compensation packages embodies our wider agenda of
considering an employee’s responsibilities, experience, nurturing and empowering promising talent and creating
and performance. We have institutionalized generous an environment that fosters long-term professional
reward systems designed to encourage employees to relationships based on industry-approved labor practices.
perform above and beyond expectations. An employee’s The bank also engages in Collective Bargaining
level in the organization is determined by the Job Grade Agreements (CBA) with union members, negotiating fair
(for rank and file employees) or Corporate Rank (for policies for the benefit of our employees. It provides for
officers) identified with their position, which is the basis wage increases, higher insurance coverage, improvements
of compensation and benefits relative to the banking in medical allowance, and a contract signing bonus for
industry. The position title of an employee defines the all rank and file employees nationwide. China Bank has
general description of their function (e.g. Customer already had 24 successful CBAs in its 96-year history, and
Relations Assistant, Branch Head) while the Job Grade China Bank Savings has had its first CBA last 2015.
and Corporate Rank determine the hierarchy in terms of
pay and benefits (e.g. Manager, Senior Manager, Assistant
Vice President).

China Bank 33 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

EMPLOYEE BREAKDOWN

MALE FEMALE 35 AND BELOW 36 TO 50 51 AND UP

BY GENDER 2,583 5,541 BY AGE 5,623 2,020 481

EMPLOYEE BREAKDOWN BY
BY GROUP GEOGRAPHIC ASSIGNMENT EMPLOYEE BREAKDOWN BY RANK

China Bank Capital Corp. 21 NCR 5,173 Rank and File 5,356
CBC Insurance Brokers, Inc. 69 Luzon (Non-NCR) 1,651 Junior Officers 2,493
CBC Property & Comp Ctr., Inc.
165 Visayas 835 Senior Officers 275
China Banking Corp. 5900 Mindanao 465
China Bank Savings, Inc 1969

TRAINING Professional training and development programs are offered

China Bank is committed to developing the potential of its through both in-house and company-sponsored external
employees and offering them opportunities to advance in training courses. These courses are designed to have direct
their careers. Our diverse and thorough training programs relevance to the trainees’ duties and functions, or else
are designed to equip our officers and staff with the prepare them for a specific new function.
skills and competencies they need to meet and exceed
our strategic objectives—preparing them for higher We also offer a Tuition Refund Program for Graduate
responsibilities and to adapt to changes in the business Studies, where employees can pursue Masters in Business
environment, banking regulations, and new technology, Administration, Finance, Banking, Economics, Statistics,
methods, and procedures. Computer Science, Business Management, and other
courses related to banking and investments, with the
These Employee Development Programs have been financial support of the Bank. As a China Bank scholar, an
formulated to provide focused, relevant, and timely content employee must maintain passing grades, at the same time,
that will nurture and fortify the skills and knowledge they a performance rating of “Good” at work.
need as they fulfill their tasks and duties.
Programs
Conducted Participants
• Supervisory Development Program
Officer Training 134 2863
• Management Trainees
Staff Training 256 7150
• Technical Staff Development Program
New Programs/courses 202 3704
• Branch Heads Training Program
External 280 486
• Junior Executive Development Program
Tuition Refund Program 8
• Area Heads Development Program
Total 917 15585*
*Total attendance is more than number of employees as
The Bank likewise invests heavily on job-specific training for employees participate in several courses during the year.
its employees to ensure employees are equipped with the Total training hours: 193,163.14
right competencies to perform their roles effectively. This
includes both Technical and Behavioral Skills.

China Bank 34 Annual Report 2016

REWARDS AND RECOGNITION to have enough chances for rest and relaxation. To this end,
Our Rewards and Recognition program acknowledges we have implemented a diverse work-life balance program
high-performing employees and fosters a positive for our employees.
and productive working environment where they are
encouraged to constantly strive for excellence. Deserving Outside of the workplace, we provide our employees
employees are given promotions and those who with activities that strengthen camaraderie and promote
perform above and beyond the call of duty or those with community participation and personal growth. In 2016,
outstanding achievements are given awards. During our many employees participated in company-sponsored
regular Retail Banking Business National Convention, top sports activities like bowling and basketball, other forms
performing branches and branch managers are honoured of recreation, as well as workshops and programs that
for their exemplary performance in different categories. addressed employees’ health and wellness.

Employee loyalty and dedication are also duly rewarded. The Bank has several programs designed to uplift the “total
Service awards are given at every China Bank anniversary person” in employees. These programs give employees
celebration to employees who have rendered service of avenues to learn other skills outside of their profession. This
10, 15, 20, 25, 30, and 35 years. includes livelihood-related programs, sports and recreational
programs, educational programs and scholarships, and
Rewards & Recognition Program Awards
social and spiritual activities.
• Model Employee of the Year
• Quick Win Award Work-life Balance

• Breakthrough Idea Award • Cooking, baking

• Top Sales and Marketing Award • Music

• Project of the Year • Dancing

• Product of the Year • Various hobbies

• Special Meritorious Circumstances Award

Sports
• Special Citation Award
• Basketball
• Critical Project Completion Award
• Volleyball

RBB National Convention Awards • Bowling

• Branch of the Year • Badminton

• Top CASA (Checking & Savings Account) Contributors

Social Clubs
• Top Sales Associates
• Running
• Top Performers / Referrors (for Bancassurance, Consumer
Banking Group, Cash Management, Insurance, Private Banking • Photography
Group, Treasury Group, and Trust Group
Spiritual
WORK-LIFE BALANCE • Masses
At China Bank, we recognize the need for our employees • Bible studies
to maintain a holistic approach to their lifestyle, both in and
out of work. We believe that a productive and motivated Outreach Programs Financial Literacy (Orientation)
workforce requires ample opportunities to exercise and • Managing Your Finances (during Orientation for New Employees)
pursue their non-professional and recreational interests and

China Bank 35 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Our office hours are from 8.30 am to 5.30 pm, with a With its integrated slate of Communication Programs,
one-hour lunch break. Employees report to work five employees are given an inviting and open avenue to
days a week. express and relay their experiences, suggestions, and
feedback.
They are entitled to various types of leaves as mandated
by law and enjoy breaks during the declared public • Sharepoint Café: Used to generate ideas, solutions and action
holidays of the Philippines. plans that can address possible concerns or issues encountered
by officers of the Bank. It also aims to build rapport among CBC
officers and increase their commitment and pride in the Bank.
• Third Phase Interview: A follow-up mechanism to monitor the
extent of adjustment of new employees on their third month
with the Bank. It focuses on the nature of work being handled,
training received, relationships with peers and superiors,
clarifications concerning bank policies, existing procedures in
handling work, and problems at work, if any.
• Organizational Health Check: an Organization Development
EMPLOYEE COMMUNICATIONS
intervention which aims to ensure engagement and commitment
The Bank’s administration constantly maintains a good
among employees. It involves questionnaires and one-one-one
relationship with its employees to ensure that both of their
interviews with employees of target group.
objectives remain aligned with the Bank’s goals while
• Team Effectiveness Program: A program that uses a
simultaneously addressing their concerns. We offer our
Needs Assessment Questionnaire to identify strengths and
employees a safe and supportive work environment where
improvement areas of a group to achieve team effectiveness for
everyone is granted their right to be respected and heard,
better performance.
and treated equally and fairly. Any concerns, opinions and
suggestions are promptly noted and duly acted upon. The • Voice Avenue: A retention tool in assessing an employee’s

Bank implements policies, resources and mechanisms current disposition and perception about his/her job and the

to efficiently manage and resolve employee grievances organization. It Identifies what makes employees stay and

and appeals, process employee feedback, adjudicate what keeps them engaged after a certain period of time, and

disciplinary cases and to promote a better understanding determines what can prevent future resignations.

of and adherence to China Bank’s operational policies

and procedures, Code of Ethics, as well as the relevant EMPLOYEE SAFETY AND HEALTH
laws and BSP rules and regulations. China Bank employs its own Safety and Health Policy
to safeguard our employees against injury, sickness or
News and information about company developments, death, and to ensure that the workplace retains a certain
employee movements, as well as events, promos and standard of safety, security, and health to promote
messages from company officials are featured and productivity. This policy is supported by the Corporate
coursed through to employees in the Bank’s official Safety and Health Committee (CSHC) and the Unit Safety
newsletter called NewsTeller. The publication is released and Health Committee (USHC).
every two months and is distributed to all branches. China
Bank Savings likewise produces the CBS NewsTeller, The CSHC is our central planning and policy-making
which focuses on CBS-related events and developments. group in all matters regarding safety and health, including

China Bank 36 Annual Report 2016

the timely updating and revision of China Bank’s EMPLOYEE WELFARE
emergency procedures and evacuation plans in case of We have employee welfare programs in place as carried
fire or other hazardous incidents. Meanwhile, the USHC out by our HRD, such as seminars to develop other
is chiefly involved with directing our accident prevention skills sets or livelihood training. In September 2016, HRD
efforts, including annual fire and earthquake drills, and conducted a series of free livelihood workshops called
spreading awareness about emergency escape routes, “Go Entre Pinoy” where a professional cook taught a
in accordance with the prescribed Bank safety and tocino and longganisa-making class to the Bank’s drivers,
health programs and pertinent government regulations. messengers, janitorial, maintenance and catering staff, and
Each USHC has its own Red Cross-certified first aider even their relatives.
who is duly trained in Adult CPR and Office First Aid to
ensure prompt and proper response in case of any office
emergencies.

To ensure and strengthen Bank-wide implementation

and observance of Occupational Safety and Health
Standards, each branch or department has its own
USHC. In case of disasters, the CSHC and the USHC
will coordinate with our Operational Risk Department for
disaster contingency planning and the mobilization of
the Crisis Management Team.
The Bank also regularly conducts fire and earthquake
Our Makati headquarters houses a well-stocked clinic safety drills among its employees to make sure that they
staffed by both a registered nurse and a doctor that are equipped with the knowledge on how to keep safe in
employees can consult with regarding their health the event that a disaster strikes.
concerns. There are also on-duty nurses in our offices in
Philcom Building, VGP Center, Binondo Center, and Cebu In 2016, HRD introduced a series of non-work-related
Business Park. The medical team also provides guidance workshops whose aim is to provide a venue for employees
and supervision on occupational health. First aid kits are to de-stress. Aptly called “Work-life Balance Seminars,”
available in all branches. Health and safety bulletins are these half-day activities are usually done on Saturdays and
regularly disseminated to our employees through email introduce China Bankers to a wide range of hobbies and
and the Bank’s Intranet, covering topics such as accident interests such as dancing, soap-making, calligraphy, and
prevention and work-related sickness prevention. even self-defense. Professionals in their respective fields
are invited to be the resource people for each workshop,
ensuring that employees learn new skills and pastimes only
from the best.

As a testament to our commitment to prioritize the

health and wellbeing of our own employees, we received
compliance certifications from government bodies
such as the Department of Labor and Employment and
Occupational Health and Safety Standards.

China Bank 37 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

COMPANY CULTURE Environmental Protection

One aspect of China Bank that has kept it distinct
from its peers is its deeply-cherished culture of trust. China Bank conducts its operations in such a way that
From its inception, trust was the foundation of China regards its communities and the environment with as
Bank’s business model, a culture that China Bankers much importance as it does its business. In its workforce
have imbibed until today. Each employee is inculcated culture, an innate sense of obligation to give back is
with the virtues of integrity, openness, transparency, strongly emphasized, as well as in sustainability efforts
loyalty and honesty, which they are encouraged to aimed at creating value not only for our shareholders,
demonstrate to both clients and colleagues. Even with but more importantly, for the nation and for the
China Bank’s rapid expansion and growth through the environment.
years, its culture of trust remains the one constant
that connects and binds all China Bankers to the RESOURCE MANAGEMENT AND EFFICIENCY
same standards and ethos espoused by our founders. The China Bank head office is actively involved in the
program “Promoting Energy Efficiency in the Makati
By institutionalizing the virtue of trust, our employees Central Business District,” and in the last eleven years, it
propagate a culture that informs and guides the has been implementing projects to progressively lessen
way they conduct themselves, in accordance its operation’s impact on the environment, like switching
with our stated company core values: Integrity, to energy-efficient lighting and air conditioning systems,
High Performance Standards, Commitment to acquiring technologies to automate processes, including
Quality, Customer Service Focus, Concern for installing video conferencing facilities at the head office
People, Efficiency, and Resourcefulness / Initiative. and business centers in Luzon, Visayas, and Mindanao
China Bankers are guided by clearly defined to reduce the need for travel and thereby contribute to a
roles and expectations, reinforced by training and reduction in land and air travel emissions.
supplementary tools designed to advance their
professional careers and contribute to the Bank’s It also developed policies on conserving energy, water, and
success. paper supplies bank wide. For over 15 years, the Bank
has had a solid waste management program, which is
We firmly believe that employees treated with trust continually implemented and improved upon up to this day.
and respect will strive to repay that in kind. A trusted
employee would ensure to the best of their abilities Launched in 2012 to raise awareness on environmental
that their conduct and actions will only result in the issues and promote reducing, reusing, and recycling,
same kind of goodwill that they have been given. In China Bank’s “Going Green Campaign” continues to
the same way, we have implemented succession encourage our employees and customers to adopt and
plans that ensure the sustainability of our business. promote environment consciousness and sustainable
HRD conducts periodic reviews of the current talent working and living habits. Thus, we practice measures
pool and offers individual career development plans that promote resource and energy efficiency, and
to employees. This ensures that intellectual capital is minimization of environmental hazards through various
not lost, but rather transferred from one employee to conservation strategies. Despite our growing workforce
another. and operations, we continually pursue initiatives in all
branches, aimed at minimizing power, water, and paper
consumption, as well as reducing waste.

China Bank 38 Annual Report 2016

In offices and branches, we have replaced fluorescent The Bank helped finance a number of energy projects
lights with more energy-efficient bulbs, reduced the use that have adopted “clean coal technology” to produce
of paper by 30% by cutting down on the requirement power in an economical and environmentally responsible
for printed matter (and if we do need to print, we use manner. These include the 300-megawatt capacity
recycled paper, as in the case of our publications like expansion of the coal-fired power plants of Semirara
the Annual Report), actively uses digital communications Mining Corporation subsidiary Southwest Luzon Power
such as e-mail and webchats for employee Generation Corporation in Calaca, Batangas; the
communications, and have optimized electronic facility construction of Global Business Power Corporation
to reduce paper trail for certain bank transactions, such subsidiary Toledo Power Corporation’s 82-megawatt coal-
as online viewing of statements of account. fired power plant in Toledo City, Cebu; the construction
and operation of Aboitiz Power Corporation subsidiary
Other sustainable activities such as air-condition Therma South, Inc.’s two 150-megawatt circulating
control activities, water conservation awareness (like fluidized-bed (CFB) electric power generation facility
regularly changing the faucets, using recycled water), in Davao City and Davao del Sur; and the construction
no smoking campaign and designated smoking and operation of one of the most advanced and most
areas, transportation use of diesel and environment- fuel-efficient plants in the Visayas, a 135-megawatt CFB
friendly fuels for bank cars, armored cars etc., are power plant project in Concepcion, Iloilo.
also in place. To promote awareness, information on
these practices is disseminated through our social The Bank has received the following awards: “Best
media channels, the internal newsletter, and through Power Deal – Philippines” for the ₱42.2 billion San
employee e-mail blasts. Buenaventura Power Project and “Most Innovative
Deal – Philippines” for the ₱31.97 billion Therma
The Bank has also refurbished old personal computers Visayas Project by The Asset Triple A Awards. In 2016,
previously for office use to donate to public schools in China Bank continued to pursue its environmental
poor communities, as part of its recycling efforts. advocacy with clients when it acted as one of the co-
lead arrangers and senior lenders of the recent US$105
SUPPORTING EARTH-FRIENDLY BUSINESSES million syndicated project finance deal for Alternergy
Society’s expectations and the interests of future Wind One Corporation (AWOC), provider of alternate
generations are likewise crucial to the Bank’s financing energy services and developer and operator of wind
decisions. Beyond the numbers, the Bank takes into farms in Singapore and here in the Philippines.
consideration the environmental, social, and governance
risks involved in supporting certain businesses and
industries. Its sustained partnership with the International
Finance Corporation (IFC), a member of the World Bank
Group, for technical assistance and advisory services
under IFC’s Sustainable Energy Finance (SEF) Program,
enables it to identify potential renewable energy and
clean development projects, analyze the project risks,
and package viable financial structures to promote
sustainability and improve business bottom lines.

China Bank 39 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Social Responsibility processes to accommodate first-time bank customers,

China Bank Savings EBBs serve a wide range of clients:
Community involvement is a cornerstone of China from market vendors and blue-collar workers— people
Bank’s CSR programs. We support a wide range of who would otherwise be intimidated transacting in a
noteworthy projects for the underprivileged sector, traditional bank branch—to students and professionals.
provide educational assistance to promising children, The EBBs, numbering 13, have close to 14,000 accounts.
undertake charitable fundraising, and encourage Majority of the customers of EBBs belong to the D & E
employee volunteerism in our efforts to give back to socio-economic class.
society.
SUPPORTING UNDERPRIVILEGED COMMUNITIES
FINANCIAL LITERACY China Bank continues to provide assistance for
China Bank strongly endeavors to promote education various programs of several charities, foundations, and
through our investment in various financial literacy associations that represent sectors and communities
and financial wellness briefings to various sectors and close to our hearts. Through its business centers and
banking publics. This includes our sustained financial branches nationwide, the Bank actively participates
advisories to and consultations for our valued clients, in a number of local events such as cultural fairs,
series of investor and wealth management fora, and sports tournaments, and anniversary celebrations and
savings and investment trainings to seafarers and other conventions of different associations, organizations, and
overseas Filipino workers (OFWs). We also continually universities to uphold community values and traditions
give our share to sponsor students under the Ateneo de and foster camaraderie in the communities where the
Manila University scholarship program, as well as for the Bank operates.
education of deserving children of our own employees
through the Dee C. Chuan and the Gilbert U. Dee We likewise support underprivileged communities
Scholarship Funds. by sourcing from them some of our supplies and
giveaways. In December 2016, China Bank purchased its
FINANCIAL INCLUSION client and media gift items from Namana Crafts, a social
We partnered with the DepEd in Region 3 to give enterprise based in Quezon City that collaborates with
assistance to public school teachers and non-academic differently-skilled as well as impoverished but talented
staff. Through its thrift bank arm, China Bank Savings, artisans from all over the country.
the Bank explores new ways of providing financial
access to more people, with the aim of bringing into the With our intent to offer financial access to people from
mainstream economy those who are not in the realm of different walks and stages of life, China Bank has
banking services. It launched the Easy DepEd Loan and installed a low-hung ATM outside of its main branch in
the Affordabundle DepEd Loan which both offer easy-to- Makati that can be PWD and wheelchair user-friendly;
avail and low interest loan to this market. CBS continues as well as placed rocking chairs inside the branch for
to open Easi Banking Branches (EBBs) in SM SaveMore use of elderly clients in partnership with the S.I.L.Y.A.
outlets in Metro Manila, tapping the unbanked and Foundation (China Bank is the first bank to tie-up with
underserved sectors and making it easy for them to start the organization).
banking relationships with low—even zero— initial deposit
accounts and small business financing. Accessible The Bank is also committed to help in times of great
Mondays to Saturdays and designed in look and in need, conducting donation drives to help the victims of

China Bank 40 Annual Report 2016

three major disasters in 2013: Typhoon Maring, Bohol Consumer Protection
Earthquake, and Typhoon Yolanda. The Bank also
had a separate internal donation drive and provided As enshrined in its core values, China Bank is deeply
a calamity assistance package to affected employees committed to protect the interests of its clients. This
which include cash assistance, calamity loan at a customer service focus continuously guides our
reduced interest and flexible payment terms, and special policies as we render fair, honest, and equitable service
leaves that are not chargeable against vacation leave to our clients.
credits. Demonstrating the company spirit, the Bank’s
employees volunteered to help in various relief efforts by We are vigilant caretakers of our clients’ interests,
way of cash and in-kind donations and helping repack ensuring that they are well-protected throughout their
and distribute relief goods. relationship with the Bank. Even before the BSP Circular
857 on Consumer Protection was issued in 2015,
We integrated corporate social responsibility by China Bank had already been compliant with most of
motivating our employees to extend personal goals its provisions. This included the creation of a dedicated
beyond the workplace and share a part of themselves consumer assistance group, which the Bank had already
with the needy through community-nurturing programs. established through its Customer Contact Center.
Our continuous fundraising activities include the collection
and selling of recyclable materials such as plastic bottles, Nonetheless, we continued to assess and fortify key
shredded paper, and used carton boxes, and voluntary components for financial education and awareness,
personal contribution through salary deduction. fair treatment for all concerned stakeholders, customer
handling, and risk management.
In November 2016, HRD conducted a rummage sale
in the head office dubbed “Tindang Bigay Tulong,” the SECURITY AND FRAUD PREVENTION
proceeds of which went to the sponsorship of food of We have implemented stringent control systems to
the children that the group visited at the Manila Day protect our clients from security threats and financial
Care Centers of Barangay 272, 274, 276, and 285 in theft. These systems are designed to ensure that
Binondo as part of a bigger activity called “Caring is the banking transactions are secure and reliable,
Sharing.” Held in December 2016, “Caring is Sharing” whether conducted through the branches or e-banking
was the initiative of HRD-Recruitment and Placement channels.
Department which benefited around 300 daycare center
students in Binondo. Our ATMs are regularly inspected for PIN/card data
skimming devices. We have awareness campaigns
that encourage our clients to take extra precautions
on how to protect their money, PIN, ATM and credit
cards through email, posters and social media. We
also regularly provide guidelines on protecting personal
information and accounts against fraud and misuse.
Our branch personnel are likewise trained to give
clients appropriate assistance in matters of asset
protection as well as procedures for reporting fraud
cases and captured/missing/stolen cards.

China Bank 41 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Our Customer Contact Center, ATM Center, and other different media and channels such as printed materials
frontliners supported by capable IT teams stand ready that are prominently displayed in our branches or
to respond and give resolution to clients who become directly sent to customers—TV, print, radio and other
victims of phishing and other similar scams. forms of advertisements; our website and social media
channels such as Twitter and Facebook; and our
Customer Contact Center. All consumer information
required by the BSP are likewise openly displayed at
our branches. Our branch personnel are professionally
trained to handle inquiries about our policies— they
will readily explain risks relating to our products and
services, and provide financial counseling when
required.

CUSTOMER CONCERN HANDLING

Through its diverse selection of communication
PROTECTION OF PRIVACY OF INFORMATION
channels, China Bank provides its clients with
To ensure the security of client account information and
accessible and efficient means to communicate
other related details, we utilize enhanced verification
their inquiries and concerns. Each concern raised is
processes across all available channels of service. Our
considered a welcome opportunity that will allow us to
Online and Tellerphone facilities make use of a multilevel
improve our services and provide a more convenient
security verification procedure prior to processing
banking experience to our clients.
transactions, while our Customer Contact Center
conducts several layers of positive identification before
China Bank clients may communicate concerns through
assisting clients with their needs.
different means, namely: (1) Phone call, (2) Email, (3)
Social Media sites, (4) Website Support Center, and (5)
We also continuously issue warnings on information
via its branches. All concerns reported through these
security threats to our clients and provide them
channels are documented and handled in compliance
with practical and useful guides on how to protect
with existing bank and BSP-prescribed guidelines.
themselves against such threats through our website,
Through our Customer Contact Center, we have
social media accounts, email announcements, and ATM
implemented a reliable Incident Management System
screen displays.
which logs and monitors client concerns supported by
documentation and concrete data. With the system’s
DISCLOSURES AND TRANSPARENCY
periodic and thorough customer service reports, the
In keeping with our commitment to integrity, the Bank
Bank gains valuable insight from which to refine and
ensures that the information about our products
improve "overall customer experience".
and services are clear, understandable, accurate,
and accessible. We give all necessary and relevant
In 2016, the bulk of the issues that we received and
information to our clients to duly inform their
handled pertained to alternative channels and credit
decisions when transacting with us. The information
cards such as ATM withdrawal concerns, bills payment
is communicated to our customers through the use of
and fund transfers done through electronic channels,

China Bank 42 Annual Report 2016

credit card declined transactions, and non-receipt complaint reporting mechanism for all branches and
of credit card statements. Concerns regarding the business units was implemented, as well as improvements
enhancement of the online banking system were also to the current Incident Management System which logs
received and satisfactorily handled by the Bank’s and monitors client concerns with prompt submission of
front-liners. Proper coordination between the branches accurate reports. These efforts are coupled with the use
or business units involved and the Customer Contact of all available channels of communication, ensuring the
Center ensured a prompt response for each issue that convenience of our clients.
was raised.
The Customer Contact Center has greatly increased the
CUSTOMER CONTACT CENTER efficiency of our various business units. It has helped the
China Bank has a dedicated Customer Contact Center, Retail Banking Business by implementing the Mystery
which helps develop a strong customer service culture Caller Program which provides us an overview on customer
by taking on a lead role in implementing changes to service standards of our branch personnel. It also oversees
the Bank’s consumer assistance process. The group the Credit Card Division’s Telemarketing Program for
forms part of the Bank’s compliance with BSP 857, its card acquisition efforts and provides support for its
which mandates the creation of a consumer assistance Balance Transfer, Transaction Conversion and Card
group. Since its establishment, an integrated customer Activation programs.

2016 CUSTOMER INTERACTIONS

CUSTOMER SUPPORT
7 am to 7 pm, 7 days a week
(Press “0” to speak to a phone banker)

88-55-888 E-MAIL
Metro Manila [email protected]

Toll-free numbers: MAIL

3% Others Customer Contact Center
1800-1888-5-888 (PLDT) China Bank Building, 8745 Paseo de Roxas
<1%Remittance 1800-3888-5-888 (Digitel) Corner Villar Street, Makati City 1226
Provinces Philippines
<1% Loans Concerns
001-800-1-888-5888 FAX
1% Cash Management Hong Kong / Singapore (02) 519-0143
2% Deposits & Branch Banking
011-800-1-888-5888 WEBSITE
39% Credit Cards USA www.chinabank.ph
54% Alternative Channels

China Bank 43 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

The Corporate Governance Committee: (L-R) Alberto S. Yao, Roberto F. Kuan, Hans T. Sy, and Joaquin T. Dee

Corporate Governance dedication, and competence, fully embracing the Bank’s

mission, vision, and values; they chart China Bank’s path to
Good corporate governance is one of the most important success, guided not only by the Bank’s principles, but also
cornerstones in ensuring the sustainability of our business. by the principles of good corporate governance— integrity,
By upholding the highest ethical standards in conducting fairness, accountability, and transparency.
our business, we have earned the trust and confidence of
our stakeholders and our business partners. In banking, Our leaders set the tone of governance and ensure that
trust is everything. By building on this trust—which has mechanisms for disclosure, protection of the rights of
endured through our 96 years of banking business—and shareholders, equitable treatment of shareholders, and
complementing it with leading edge technology, efficient accountability of the Board of Directors and Management are
systems and processes, and by running our business with a in place and diligently implemented in accordance with the
highly trained professional team, we are able to attract the best highest ethical standards and strictest regulatory compliance.
customers and business partners, lower our cost of funds, and
ultimately, build a strong brand franchise with loyal customers. Together, the Board and Management maintain a collaborative
With this time-tested trust as the foundation of our business, and productive work environment that drives high performance
we will continue to inspire new generations of banking and quality orientation, consistent with our commitment to
professionals who adhere to the same guiding principles of deliver strong customer and shareholder value.
trustworthiness.
China Bank was founded on a strong commitment to
China Bank’s operations and management is anchored on a doing business the right way. For us, “the right way” means
structure that exercises principled leadership, a high standard conducting our day-to-day activities in a manner that serves
of excellence, and unified commitment to good corporate the best interest of our various stakeholders and upholding
governance. It is led by a vigilant and high functioning Board of the principles of responsible corporate citizenship: integrity,
Directors and Management team with unquestionable integrity, fairness, accountability, and transparency. We constantly

China Bank 44 Annual Report 2016

endeavor to improve our governance practices not only Laws, rules and regulations, to name a few—having a more
because it is good for our business, but more importantly, to assertive Board enables us to send a clear message to the entire
enable shared success—to build a stronger and sustainable organization and to our business partners that good governance
banking experience for our customers, stakeholders, and the is a requirement in all business undertakings.
communities we serve.
Profit with honor is indeed an admirable business philosophy.
Our most significant governance hallmark is an already assertive Ultimately, it ensures the long term viability and sustainability of
Board that is fully engaged in good governance at a level the business.
beyond compliance. They are attuned with the reforms imposed
by the country’s regulators to elevate corporate governance To strengthen the implementation of good governance in the
practices in the country—like the creation of a Related Party field, we continuously educate our employees about Compliance,
Transaction Committee wholly composed of Independent Good Governance and its benefits, the Bank’s Code of Ethics,
Directors, going beyond the BSP requirement to have at least the Policy on avoidance of conflict of interest, among others, to
two (2) independent directors. Enhancements of policies on ensure that everyone in the institution are in the same direction
fraud prevention, anti-bribery and related party transactions, well towards good corporate governance and to develop a culture of
working whistle-blowing mechanisms, continuous training for good governance and to enable the employees of the Bank to
directors on corporate governance and Anti-Money Laundering embrace the principles set forth by the Board.

Beyond Compliance on Corporate Governance-Philippines for the second year in a row

by the same journal, for the Bank’s performance on upholding the
Trust is the foundation of China Bank’s culture. And for nearly a rights of shareholders, disclosure and transparency, board and
century, China Bank continues to uphold fair employee and service management, discipline, environmental practices, among others.
provider practices, competitive employee compensation, balanced The 6th Asian Excellence Award—which seeks to promote and
working environment, sense of responsibility for and the protection encourage environmental, social and ethical compliance as well as
of privacy for our customers, and open communication among all sound investor relation, corporate social responsibility, and the Asian
stakeholders. values of corporate governance—was held on June 17 at the JW
China Bank’s strong commitment to champion good governance Marriott in Hong Kong.
is validated by the various accolades that we have been receiving in Globally and locally, the common theme today is making the
recent past. future safer (in terms of returns, partnering with companies that
China Bank won the PSE Bell Award for Corporate Governance also embrace sustainability, or engaging reputable companies, for
for the fifth year in a row. It was again the only bank among the top example, for our supplies, etc.) for all market participants, especially
five annual awardees in the publicly-listed company category and the for investors and consumers. This objective led to a series of new
only awardee to have won in all Bell Awards since it was launched by and stricter rules and regulations on governance. On our part,
the Philippine Stock Exchange in 2012. this means we need more tools to manage risk and regulatory
We were also awarded with three honors at the 6th Asian compliance without necessarily increasing our costs.
Excellence Award 2016, an awards program by regional journal Our driving force is our stakeholders—our customers,
Corporate Governance Asia that recognizes standards of excellence shareholders, employees, and the communities we serve. They
for corporate governance achieved by companies across Asia. China are the reason for our mission of becoming a leading provider of
Bank took home the awards for Best Investor Relations Company- quality services and a primary catalyst in the creation of wealth, while
Philippines, Asia’s Best CEO (Investor Relations) for President and maintaining the highest ethical standards and sense of responsibility
CEO Ricardo R. Chua, and Best Investor Relations Professional for and fairness. Governance at China Bank is aligned with our
Senior Vice President and Head of Investor Relations Alexander C. commitment of doing business the right way, in accordance with the
Escucha. Last year, China Bank was hailed Outstanding Company law, the best practices, and the best interest of our stakeholders.

China Bank 45 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

I. THE BOARD OF DIRECTORS AND with China Bank, the controlling shareholders, or the
THE ORGANIZATIONAL STRUCTURE Management that would influence their decisions or
At the core of China Bank’s organizational structure is its interfere with their exercise of independent judgment,
Board of Directors, the highest governing authority at the among others.
Bank. The Board represents and is accountable to our
shareholders, guides our overall philosophy and direction, The present Board has three Independent Directors (ID)
and sets the pace for our current operations and future and we have fully complied with all the applicable rules on
developments. Governance by the Board also includes their nomination and election. As stated in our Corporate
monitoring Management’s performance, establishing Governance Manual, the tenure of an ID should not exceed
standards of accountability, and setting our corporate a cumulative term of nine years: reckoned from election in
values. 2012 based on SEC rules. China Bank is one of the first
listed companies to shorten the term up to nine years.
The organizational structure is reviewed annually to reflect While they are in the China Bank Board, they are not
changes in business cope and strategy or in light of new allowed to hold interlocking directorships in more than five
regulations that may have an impact on the role and listed companies.
responsibilities of the Board and Senior Management.
In the annual assessment of Directors for the year ended
Diversity In Board Composition December 31, 2016, the Board was satisfied that each
The Board seeks to ensure diversity in its composition by of the IDs continue to be independent and free from any
taking into consideration the age, educational background, business or other relationship, which could interfere with
collective working knowledge, experience and expertise of the exercise of independent judgment.
its members. It is composed of individuals with integrity,
qualifications, skills, and experience, providing an ideal Election of the Board and Succession
mixture of core competencies such as finance, legal, The position of a China Bank Director is one of trust; thus,
accounting, business management, marketing, and the directors are selected for their integrity, credibility,
investment management for the effective Board oversight of leadership, experience at policy-making, and their ability
China Bank’s business activities and affairs. to render independent judgment. We welcome diversity
in our Board. The shareholders nominate candidates
The present Board size of 11 Directors and one Adviser by submitting the nomination to any of the members of
is commensurate with the size and complexity of our the Nomination Committee, the Corporate Governance
operations. Of the 11, two are executive Directors and Committee, or the Corporate Secretary on or before the
the rest are non-executive Directors, including the three prescribed date.
Independent Directors. An Executive Director is a Director
who has executive responsibility of day-to-day operations The Nominations Committee reviews and evaluates the
of a part or the whole of the organization. China Bank has qualifications of the candidates, the full Board confirms
no executive Director who serves on more than two boards these candidates’ nomination, and the shareholders
of listed companies outside of the China Bank Group. We elect the directors during the Annual Stockholders’
have complied with the regulatory requirements on Board Meeting. Upon their election, the members of the Board
composition. are issued a copy of their general and specific duties
and responsibilities as prescribed by the BSP Manual of
Independent Directors Regulations for Banks (MORB), which they acknowledged
A strong element of independence is maintained on to have received and certified that they read and fully
the Board. In fact, we conduct an annual review of the understood the same. Copies of the acknowledgement
independence of our Directors. We define an Independent receipt and certification are submitted to the BSP within
Director as someone holding no interests or relationships the prescribed period. Moreover, the directors also

China Bank 46 Annual Report 2016

individually submit a Sworn Certification that they possess Board is addressed in the Bank’s By-Laws. Vacancies in
all the qualifications and none of the disqualifications to the Board may be filled by appointment or election of the
serve as an ID. These certifications are submitted to BSP remaining directors. The Board may also use professional
after their election. Additional certifications are executed search firms or other external sources when searching for
by independent directors to comply with the Securities ideal candidates for the Board. The stockholders may also
Regulation Code and BSP rules which are then submitted fill such vacancy in a regular or special meeting called for
to the SEC. Succession, replacement or vacancy in the this purpose.

Organizational Structure

BOARD OF DIRECTORS
Corporate
Secretary

BOARD COMMITTEES

Related Party Compensation Executive Trust and AUDIT Risk

RISK Corporate
Nominations
NOMINATIONS Audit Compliance
COMPLIANCE
Transaction or Remuneration Committee Investments Management
MANAGEMENT Governance

Board of Trust and Asset AUDIT Risk

Office of the Audit Compliance
Trustees of CBC Management DIVISION Management
Vice Chairman Division Office
Retirement Group Group

President & CEO

Credit
CREDIT Management
Committee
COMMITTEE Committee

Technology
Steering
Committee

Information Security
Security Office Office

Chief Operating
Officer

Retail Banking Lending Business Financial Financial Corporate

Business Business Operations Markets Management Support
Segment Segment Segment Segment Segment

Investor and
Corporate
Relations Group

China Bank 47 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE
Separation of the Role of the Chairman and the Chief and summarizing the questions asked and the answers
Executive Officer (CEO) given in the minutes, among other things. She is abreast on
The position of Chairman of the Board and President and CEO relevant laws, rules and regulations and advises the Board and
are held by two different people, and their roles are clearly Chairman of any issue that may arise in these areas, including
distinct and separate. industry developments and operations.

Chairman Hans T. Sy, being a non-executive Director, is not She provides counsel on governance issues to advance the
involved in the day-to-day operations of China Bank, but is Board’s commitment to transparency by ensuring timely and
responsible for the leadership and effective running of the accurate corporate disclosures.
Board, including maintaining a relationship of trust with Board
members, promoting a sound decision-making process by
encouraging critical discussion of dissenting views and ensure
that the performance of the Board is evaluated at least once a
year. He chairs Board meetings and makes certain that agenda
is focused on strategic matters, including risks, arranges regular
and/or separate sessions with the non-executive Directors to
review Management’s performance.

The President and CEO, who reports to the Board, is ultimately

responsible for managing China Bank’s day-to-day operations,
as well as the development and execution of the corporate and
business strategies as established by the Board of Directors. Board Meetings and Supply of Information
As stated in the Bank’s By-Laws, the Board meets every first
Corporate Secretary Wednesday of the month to review China Bank’s financial
To enable our Directors to discharge their duties efficiently and performance, approve strategies, policies, and business plans,
effectively, they have full and unrestricted access to Management as well as to consider business and other proposals which
and employees of the Bank and affiliated companies, external require the Board’s approval. Special Board meetings may
consultants and advisors, and the Corporate Secretary. The also be called to deliberate and assess corporate proposals or
Board is assisted in its duties by a Corporate Secretary. business issues that also require Board approval.

Our Corporate Secretary is Atty. Corazon I. Morando. Alongside The Directors are expected to prepare for, attend, and
her traditional role as the official record keeper responsible participate in these meetings, and to act judiciously, in
for the administrative side of board and committee meetings, good faith, and in the best interest of China Bank and our
Atty. Morando is also a corporate governance gatekeeper stakeholders.
responsible for overseeing sound Board practices, as well as
a Board liaison who works and deals fairly and objectively with The Board is provided with the information and resources
the Board, management, stockholders and other stakeholders. needed to effectively discharge its fiduciary duty. The
With a deep understanding of China Bank’s operations and the Board is informed on an ongoing basis of the Bank’s
principles of good corporate governance, Atty. Morando works performance, major business issues, new developments,
closely with the Board to ensure the continuous improvement of and the impact of recent developments in the economic
the Board, as well as to uphold Board and annual stockholders’ and regulatory environment. The Directors are provided
meeting best practices, including releasing meeting notices Board materials related to the agenda five business days
to shareholders well within the prescribed period, providing in advance of meetings, by the Corporate Secretary to
explanations to promote better understanding of the agenda, allow them to prepare for discussion of the items during the

China Bank 48 Annual Report 2016

meeting. Members of Senior Management are invited to Board Training
attend Board meetings to provide the Board with detailed In place is a full orientation program for newly-elected
explanations and clarifications on proposals tabled to Directors which may include branch visits and comprehensive
enable the Board to make an informed decision. The training materials and operations manuals. A continuing
meetings of the Board and its committees are recorded in education process for all the Directors include briefings on
minutes, and all resolutions are documented. relevant new laws, risk management and technology updates
and changes in accounting standards. In compliance with the
Board Decisions BSP and SEC requirements, all Directors have attended the
In cases where a decision is to be arrived at by the Board, required Corporate Governance Seminar.
as a matter of policy, decisions should be made only upon
quorum of 2/3 members of the board present, unless a On November 2, 2016, the Board, together with the
different voting requirement is required by existing laws, members of the Management Committee, the Chief
rules and regulations. Except for significantly compelling Compliance Officer, Chief Risk Officer, and the Chief Audit
reasons, an independent director should always be in Executive, among others, attended an Exclusive Corporate
attendance in every meeting, recognizing the significant Governance Training conducted by the Institute of Corporate
role of an ID in the Board decisions. Members of the Senior Directors. This training provided the board with significant
Management shall be invited to attend Board meetings to and useful insights on Risk Management, Technology, and
provide the Board with necessary information to enable the current governance issues
Board to make an informed decision.
Exclusive Corporate Governance Training
2016
In 2016, the China Bank Board had 14 meetings, including for Directors and Key Officers
the organizational meeting regularly held after the Annual 2015 Exclusive Corporate Governance Training
Stockholders’ Meeting.
Exclusive Corporate Governance Workshop
2014
Anti-Money Laundering Seminar
2009 Anti-Money Laundering Seminar
Special Seminar on Corporate Governance for Bank
2002
Chairmen & CEOs

No. of No. of
Board Name Date of Election meetings held meetings %
during the year attended
Chairman Hans T. Sy May 5, 2016 14 12 86%
Member Gilbert U. Dee May 5, 2016 14 14 100%
Member Ricardo R. Chua May 5, 2016 14 14 100%
Member Peter S. Dee May 5, 2016 14 13 93%
Member Joaquin T. Dee May 5, 2016 14 14 100%
Member Herbert T. Sy May 5, 2016 14 14 100%
Member Harley T. Sy May 5, 2016 14 13 93%
Member Jose T. Sio May 5, 2016 14 14 100%
Independent Dy Tiong May 5, 2016 11* 8 73%
Independent Alberto S. Yao May 5, 2016 14 14 100%
Independent Roberto F. Kuan May 5, 2016 14 14 100%
*For Director Dy Tiong, up to September 2016 only, considering his passing on 16 September 2016

China Bank 49 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Board Committees of the risk management plan and strategies to

To enhance the effectiveness of the Board in discharging ensure its implementation and continued relevance,
its fiduciary duties and to complement it in the execution comprehensiveness, and effectiveness. The RMC is also
of its responsibilities, the Board has established nine responsible for the identification and evaluation of exposures
Board-level committees and three Management-level and oversight the systems of limits.
committees. Each committee has a charter and operates
within its specific delegated authority and functions. The The RMC convened 16 times in 2016, including four joint
committee charters, which are reviewed annually and meetings with the Executive Committee.
amended when necessary, are posted in our corporate
website, www.chinabank.ph. Name of Director Attendance %
Joaquin T. Dee (Chairman) 16 100
The members of the different committees are appointed Hans T. Sy 15 94
by the Board at the annual organizational meeting, taking Gilbert U. Dee 16 100
into account the optimal mix of skills and experience of Alberto S. Yao 14 88
the members.

Executive Committee (ExCom) When the Board is not in

session, it shall exercise the powers of the Board in the
management of the business and affairs of China Bank
between meetings of the Board of Directors, to the fullest
extent permitted under Philippine law. The ExCom convened
42 times in 2016, with four joint meetings with the Risk
Management Committee.

Name of Director Attendance % Audit Committee primarily oversees all matters pertaining
Hans T. Sy (Chairman) 35 83 to audit, including the evaluation of the adequacy and
Gilbert U. Dee 42 100 effectiveness of the Bank’s internal control system. It likewise
Peter S. Dee 37 88 provides oversight on the activities of Management and
Joaquin T. Dee 42 100 the internal and external auditors. It appoints, reviews and
Ricardo R. Chua 39 93 concurs in the appointment or replacement of the Chief
Audit Executive, and is responsible for ensuring that the
Chief Audit Executive and internal audit function are free
from interference by outside parties, and there is an annual
review of the effectiveness of the internal audit function
including compliance with the Institute of Internal Auditors‘
International Standards for the Professional Practice of
Internal Auditing and Code of Ethics. The Committee is also
empowered to oversee the Bank‘s external audit functions,
financial reporting and policies, by selecting the auditors and
approving their fees, reviewing and discussing the scope
and plan of annual audit, and reviewing and discussing
Risk Management Committee (RMC) is responsible with management and auditors the annual audited financial
for the oversight and development of all the Bank’s statements of the Bank. It also provides oversight over
risk management functions, including the evaluation management‘s activities in managing credit, market, liquidity,

China Bank 50 Annual Report 2016

operational, legal and other risks of the Bank, including Corporate Governance Committee is responsible for
regular receipts from management of information on risk ensuring the Board’s effectiveness and due observance of
exposures and risk management activities. corporate governance principles and guidelines, and oversees
the periodic evaluation of the Board and its Committees, as
Name of Director Attendance % well as of the Executive Management.
Alberto S. Yao (Chairman) 12 100
Joaquin T. Dee 12 100 The Corporate Governance Committee convened 23 times
Dy Tiong* 9 100 in 2016; 10 joint meetings with the Audit and Compliance
*Director Dy Tiong (†) attended 9 out of 9 meetings. Committees; and 13 joint meetings with the Nominations
Committee.
Compliance Committee is tasked to monitor compliance with
established banking laws, rules and regulations specifically in Name of Director Attendance %
the mitigation of business risks and ensures that Management Roberto F. Kuan (Chairman) 20 87
is doing business in accordance with the said prescribed laws, Joaquin T. Dee 23 100
rules and regulations including policies, procedures, guidelines,
Hans T. Sy 21 91
and best practices.
Alberto S. Yao 23 100

The Compliance Committee convened 10 times in 2016, jointly

Compensation or Remuneration Committee provides
with the Audit and Corporate Governance Committees.
oversight over the remuneration of senior management and
other key personnel, ensuring that compensation is consistent
Name of Director Attendance % with the Bank’s culture, strategy and control environment.
Hans T. Sy (Chairman) 9 90 Three out of the five members, including the chairman,
Joaquin T. Dee 10 100 Roberto F. Kuan, are Independent Directors.
Alberto S. Yao 10 100
The Compensation or Remuneration Committee had three
Nominations Committee is responsible for reviewing and
meetings in 2016.
evaluating the qualifications of all persons nominated to the
Board and other appointments that require Board approval,
Name of Director Attendance %
including promotions favorably endorsed by the Promotions
Roberto F. Kuan (Chairman) 2 67
Review Committee.
Hans T. Sy 3 100
Gilbert U. Dee 3 100
Based on the Bank’s revised Nominations Committee Charter,
Dy Tiong* 3 100
it is tasked to undertake the process of identifying the quality
Alberto S. Yao 3 100
of the directors aligned with the Bank’s strategic directions.
*Director Dy Tiong (†) attended 3 out of 3 meetings.
Moreover, it is composed entirely of independent directors. The
Charter is available in the Bank’s website, www.chinabank.ph
Trust and Investment Committee is primarily responsible for
overseeing the trust, investment management, and fiduciary
The Nominations Committee convened 13 times in 2016, jointly
activities of the Bank. It acts upon all trust business for
with the Corporate Governance Committee.
acceptance as well as approval of all investments for trust and
agency accounts, unless this function is specifically delegated
Name of Director Attendance % by the Board to the head of the Trust Group or other senior
Dy Tiong* (Chairman) 8 73 officers of the Bank, consistent with existing regulations.
Alberto S. Yao 13 100
Roberto F. Kuan 11 85
*Director Dy Tiong (†) attended 8 out of 11 meetings.

China Bank 51 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

The Trust and Investments Committee convened 11 times in Chua. The Management Committee is composed of Gilbert U.
2016. Dee, Ricardo R. Chua, William C. Whang, Romeo D. Uyan, Jr.,
Rosemarie C. Gan, Alberto Emilio V. Ramos, Patrick D. Cheng,
Name of Director Attendance % Alexander C. Escucha, Ramon R. Zamora, Renato K. De Borja,
Harley T. Sy 10 91 Jr., Benedict L. Chan, Virgilio O. Chua, Delia Marquez, Jose L.
Jose T. Sio 10 91 Osmeña, Jr., Ananias S. Cornelio III, and Lilibeth R. Cariño.
Herbert T. Sy 8 73
Ricardo R. Chua 10 91 Credit Committee (CreCom) reviews and approves all credit
Patrick D. Cheng 11 100 applications within its credit approval authority. It also reviews all
credit applications exceeding its credit approval authority, and if
Related Party Transactions (RPT) Committee is responsible found acceptable, endorses such to the Executive Committee
for ensuring that the RPT Policy is in place, determine the or the Board of Directors. The CreCom is composed of Gilbert
material threshold for RPT transactions, and in reviewing all U. Dee (chairman), Ricardo R. Chua (co-chairman), William
material related party transactions as defined in the existing C. Whang, Rosemarie C. Gan, Ramon R. Zamora, Romeo D.
policies of the Bank, laws, rules and regulations and ensuring Uyan, Jr. (effective May 17, 2016), Jose L. Osmena (effective
that they are conducted at arm’s length, fair market-terms or December 1, 2016), Nancy D. Yang (up to April 2016), Melissa F.
upon terms not unfavorable to the Bank. Corpus, and Ananias S, Cornelio III.

The Related Party Transactions Committee convened 11 Technology Steering Committee (TSC) oversees and
times in 2016. manages the IT resources of the Bank. Except for strategic
initiatives and IT expenditures, all matters pertaining to IT
Director Attendance % resource management and performance measurement are
Alberto S. Yao (Chairman) 11 100 fully delegated to the Committee as provided for in its Charter,
Dy Tiong* 6 75 subject to regular reporting to the Board of IT project benefits
Roberto F. Kuan 11 100 and status, IT risks, system performance and effectiveness
*Director Dy Tiong (†) attended 6 out of 8 meetings. of control measures implemented. The TSC is composed of
Ricardo R. Chua (chairman), William C. Whang, Rosemarie C.
Other Committees Gan, and Alexander C. Escucha.

Board of Trustees of CBC Employees’ Retirement Fund is Board and CEO Evaluation
responsible for the investment and disbursement of the assets The Board has an annual performance evaluation process to
of CBC Employees’ Retirement Plan in accordance with SEC assess the effectiveness of the Board as a whole, the Board
regulations and the best interests of the plan holders. The Committees, and the individual Directors, by way of a Self-
Board of Trustees is composed of Gilbert U. Dee (chairman), Assessment Questionnaire. The formal self rating system
Peter S. Dee, Ricardo R. Chua, Maria Rosanna L. Testa, focuses on the level of compliance with leading corporate
and Carlos M. Borromeo (until his resignation from the Bank governance principles and practices. As a process, each
effective July 15, 2016). member of the Board is required to accomplish the various
self-assessments and they are to return the duly accomplished
Management Committee (ManCom) formulates the Bank’s form to the Corporate Governance (CG) Compliance Officer,
business plans and budget as directed by the Board and who in turn summarizes the results for the validation of the
reports to the Board on the implementation of corporate Chief Compliance Officer. The final results are summarized
strategies designed to fulfill the Bank’s corporate mission and reported with specific recommendations to the Board.
and business goals. At the operating level, it covers top There is also a specific Self-Assessment Questionnaire on the
management matters such as, but not limited to, environmental performance of the President and CEO.
assessment, objectives setting, performance and budget
review, asset/liability management, organizational and human In 2016, the Board approved the enhancement of the self-
resource development, product development, and major assessment questionnaires to align with new regulations on
operating policies. The ManCom is chaired by Ricardo R. Board duties, RPT, Credit Risk, Operational Risk, among others.

China Bank 52 Annual Report 2016

Below is the rating system used: Framework, designed to strike a balance between linking
rewards to short-term and long-term objectives and
RATING DESCRIPTION maintaining competitiveness in the market, comprises fixed
0 Poor - Leading practice or principle is not salary, bonuses, benefits, and long-term incentives.
adopted in the company’s Manual of
Corporate Governance Vision and Mission
1 Needs Improvement - Leading practice or Our Vision and Mission, as stated on the inside front page of
principle is adopted in the Manual but
this annual report, reflect what China Bank wants to be—a
compliance has not yet been made
catalyst of wealth creation for our customers and stakeholders.
2-3 Fair - Leading practice or principle is adopted in
the Manual and compliance has been made We commit to the principles and best practices of governance
but with major deviation(s) or incompleteness in the achievement of this goal. In 2016, the Board reviewed
4 Good - Leading practice or principle is adopted China Bank’s Mission and Vision and the corporate strategy to
in the Manual and compliance has been made ensure the alignment of our direction and strategies with our
but with minor deviation(s) or incompleteness operating environment and the needs of our stakeholders.
5 Excellent - Leading practice or principle is
adopted in the Manual and full compliance
with the same has been made Corporate Governance Policy
The Board of Directors, Management, employees, and
We also adopted the SEC-prescribed performance assessment shareholders believe that good corporate governance is a
for the Audit Committee released by the SEC in 2012. In necessary component of what constitutes sound strategic
accordance with SEC Memorandum Circular No. 4, Series of business management and will therefore undertake greater
2012, the results are validated by the CG Compliance Officer effort necessary to create more and continuing awareness
and form part of the record of the Bank which may be examined within the organization.
by the SEC from time to time. The results are summarized and
reported also to the Board. Based on the results of the 2016 Corporate Governance Manual
evaluation, there are no significant deviations and in general China Bank has an extensive Corporate Governance Manual
the Bank has complied with the provisions and requirements of that embodies our corporate governance policies, governance
the Code of Corporate Governance, including the fitness and structure, principles, the specific and general duties and
suitability of each of the Directors in accordance with the Bank’s responsibilities of the Board, and the duties of the individual
Policy on Fit and Proper. directors. It is updated regularly to ensure that it is aligned with
the latest issuances of the BSP, and the rules and regulations
Board Remuneration of the SEC and the Philippine Stock Exchange (PSE). The
In accordance with the Bank’s amended By-laws, China Bank Manual is available in China Bank’s Intranet system and our
Directors are entitled to a per diem of P500.00 for attendance corporate website, www.chinabank.ph.
at each Board/Board Committee meeting and to 4% of the
Bank’s net earnings. Executive Directors are appointed under Code of Ethics
standard employment terms, which include provisions for We are strongly committed to honest and ethical
basic salary and performance bonus, depending on their standards in the conduct of our business as guided by
performance, banking experience, employment status, our Core Values—Integrity, High Performance Standards,
position, and rank in the Bank. Non-executive Directors, Commitment to Quality, Customer Service Focus, Concern
on the other hand, do not receive any performance-related for People, Efficiency and Resourcefulness / Initiative. China
compensation. Bank’s business has always been anchored on honest and
ethical conduct and compliance with applicable laws and
For employees, the remuneration policy is to maintain salary regulations. These core values are also the foundation of
range rates which compare favorably with those paid by our Code of Ethics. The Code provides clear guidelines
the banking industry for the same job function, to recognize on acceptable and unacceptable behavior and business
the relative importance of each job position, and to reward practices and is available to all employees and posted in the
meritorious performance. The Employees’ Remuneration Bank’s website.

China Bank 53 Annual Report 2016

 ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Our Board has imposed a policy of full compliance with the Code of Ethics. Our Human Resources Division ensures that every
China Bank employee is aware of and upholds the Code. In order to promote compliance with the Code, all new employees
are given a copy of the Code of Ethics booklet and undergo the New Employees’ Orientation Course (NEOC) wherein the
Code is comprehensively discussed.

Compliance With The Corporate Governance Code

Our Board has imposed a policy of full compliance with the Code of Corporate Governance. Our Compliance Office,
headed by the Chief Compliance Officer (CCO), Atty. Marissa B. Espino, is responsible for building a compliance culture
and awareness in the Bank and ensuring that the system of implementing and monitoring compliance with the Code and
the Bank’s Corporate Governance Manual are effective. For the year 2016, the Bank has fully complied with all the material
requirements of the Code of Corporate Governance.

Malls CHINA BANK

98.3%
SAVINGS INC. (CBSI)

SM Prime
PROPERTY Residential
Holdings, Inc. 50%

Citymall 34% Commercial CHINA BANK CAPITAL

100%
CORPORATION (CBCC)

Hotels &
Conventions CHINA BANK SECURITIES CORP. *

Leisure & CBC ASSETS ONE (SPC), INC.

Tourism

CHINA BANKING MANULIFE-CHINA BANK

LIFE ASSURANCE CORP. 40%
SM CORPORATION (CHIB) 19.9% (MCBLIFE)
INVESTMENT
CORPORATION BANKING
(SMIC)
Banco de Oro
44%

SM Stores CHINA BANK

INSURANCE 100%
BROKERS, INC. (CIBI)
SM
Supermarket

SM Retail Inc. SM
RETAIL Hypermarket
100%
CBC PROPERTIES AND
COMPUTER CENTER, 100%
SaveMore INC. (CBC PCCI)

*Currently known as ATC Securities Inc. pending SEC approval of change of name.

Financial Allied Subsidiary Non-Financial Allied Subsidiary Financial Allied Associate

China Bank 54 Annual Report 2016

II. INTERNAL CONTROL AND RISK MANAGEMENT approved Internal Audit Charter; risk-based audit approach
China Bank’s Board of Directors is responsible for the and methodology; well-developed annual plan that is linked
establishment and review of the Bank’s system of internal to Bank’s goals and strategies; and resourced with personnel
control while its day-to-day supervision falls upon the purview who have collective experiences, skills and competencies in
of the Management Committee. All of our employees are performing the assigned roles.
involved in our internal control processes to a certain extent
and in specific capacities. The internal control system Year 2016 was a significant year for Audit Division wherein the
comprises a well-defined management structure with clear IA’s independence and organizational stature were enhanced.
authorities, responsibilities, and operating procedures—this This was manifested through the access of the CAE to the
includes an enterprise risk management function under the meetings of the full Board and relevant Bank’s committees (i.e.
Risk Management Committee and the Risk Management Technology Steering Committee, Management Committee).
Group, a stringent compliance function with anti-money This serves as a venue to know the latest events concerning
laundering and anti-insider trading policies, a comprehensive the operations of the Bank and major decisions implemented
planning and budgeting process led by the Corporate by the management team.
Planning Division that delivers detailed annual financial
forecasts and targets for Board approval, and an internal audit Another highlight is the approval of the Audit Division
function under the Audit Division. Curriculum Plan, a developmental program created to define
the training needs of internal auditors. This curriculum plan is
Based on the continuing review and monitoring by the Audit anchored to the Institute of Internal Auditor’s Global Internal
Committee of the efficiency of the Bank’s internal system, Audit Competency Framework, which complements the
and its evaluation of management’s activities in managing overall Continuing Professional Development Program in
various risks that could impact the operations of the Bank, developing the skills and competencies of auditors. All of
the Committee affirms that the Bank’s internal control and risk these initiatives are geared towards the realization of the Audit
management systems are functioning effectively. Division’s vision—to be an innovator of best practices which
promotes excellence, continuous growth, and improvement
Internal Audit across the organization and the banking industry.
Internal Audit (IA) performs a significant role in China Bank’s
control and assurance environments. It provides the Bank’s External Audit
stakeholders with an independent and unbiased assessment The Bank’s Audit Committee is tasked with recommending
of its operations, as well as reasonable assurance on the appointment, re-appointment, and removal of an
the effectiveness of risk management, control and external auditor to ensure its independence from the internal
governance processes, and meaningful recommendations auditors. SGV & Co./Ernst & Young (SGV) has served as
for improvement of these processes. IA serves as one of China Bank’s external auditor for over 20 years, with the
the pillars of good corporate governance which improve signing partners rotated every five years in compliance with
overall management and accountability which safeguards SEC laws. Ray Francis C. Balagtas was assigned in 2016 as
organizational value. The Internal Audit Division (IAD) handles SGV’s partner-in-charge for China Bank.
these functions, and is headed by the Chief Audit Executive
(CAE), Vice President Marilyn G. Yuchenkang. SGV fulfills a critical function in ensuring that our financial
statements factually and accurately represent our accounting
The Audit Division portrays the following attributes in the records and are treated and presented in accordance with
conduct of effective and efficient audit services: dual reporting Philippine Financial Reporting Standards (PFRS). In the
lines in order to maintain organizational independence— years that SGV has been the Bank’s external auditor, it has
functionally to the Audit Committee and administratively to the not found any significant issues, such as instances of fraud,
President and CEO; authority cuts across all functions, units, dishonesty, or any other matters that could potentially result
processes, records, and personnel, backed up by Board in material losses to the Bank and our stakeholders.

China Bank 55 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

SGV representatives are also in attendance during the The Bank’s Compliance Office plays a crucial role in ensuring
Bank’s annual stockholders meeting to address matters bank-wide compliance culture in all facets of the Bank that
that concern their audit of the Bank. seeks to protect the Bank’s reputation and the interest of the
stakeholders.
FISCAL YEAR Audit and Audit- Non-Audit fees
Related fees As required under the Code of Corporate Governance for listed
2016 P6,994,960.00 P448,970 companies, the Bank’s Board is assisted in its duties by a
2015 P3,831,520.00 P493,914
Compliance Officer. The Bank’s Chief Compliance Officer (CCO)
is Atty. Marissa B. Espino who is tasked to ensure and monitor
The above audit fees are inclusive of other related services
that the provisions in the Corporate Governance Manual and
by the external auditor that are reasonably related to the
Compliance Manual, Plans and Program are complied with.
performance of the audit or review of the Bank’s financial
statements. The matter has been discussed and approved
Under the Bank's Compliance System, all units in the Bank
by the Audit Committee at its regular meetings on February
have a Compliance Coordinator whose tasked is to ensure
15, 2017 and February 17, 2016, respectively.
that all risks attendant to the operations and business of
said unit are identified, monitored and mitigated. Compliance
Likewise, the Board, Audit Committee, and Executive
Office ensures the Compliance System is effective, robust
Committee, discussed, approved, and authorized procuring
and dynamically-responsive by designing and adopting a
the services of SGV & Co./Ernst & Young for non-audit
compliance program that assures the safety and soundness
work for the independent validation of votes in the annual
of the Bank. Towards this end, the Compliance Office sees
stockholders’ meeting, for the report on the application of
to it that employees at all levels are aware of and comply
proceeds from the Bank’s 2014 stock rights offering and for
with all applicable laws, rules and regulations, by cascading
the compliance certificate issued to the international bank
the compliance plan to them and in disseminating all latest
lenders. Payment for these services and seminar fees are
issuances, advisories, notices, and other regulatory matters.
included under Non-Audit fees.
The Compliance Office also acts as liaison for the Board and
Management on regulatory compliance matters with regulatory
In previous years, China Bank had also tapped SGV
agencies. At the helm of this function is the Regulatory
to conduct an independent security assessment of the
Compliance Unit in Compliance Office.
Bank‘s systems, independent validation of the Bank‘s risk
measurement and pricing models, and implementation of
The Corporate Governance Unit within Compliance Office is
Internal Capital Adequacy Assessment Process (ICAAP),
tasked to assist the CCO in carrying out the mandate on good
and strengthening of risk management and audit processes
corporate governance.
through project engagements which include ICAAP for
Internal Audit, ICAAP Phase 2, Risk Model Validation and
Anti-Money Laundering
ICRRS. SGV is again recommended for appointment at the
The Board and Management team of China Bank are firmly
scheduled annual stockholders meeting.
committed to ensure bankwide compliance with the Anti-
Money Laundering (AML) laws, rules and regulations. To this
Compliance System
end, the Bank has adopted a Money Laundering and Terrorist
The Bank has in place a Compliance System designed to
Financing Prevention Program (MLPP) approved by the
specifically identify and mitigate business risks which may
Board of Directors. The MLPP provides for the requirements
erode the franchise value of the Bank. In compliance with
to combat money laundering and promotes high ethical and
BSP's requirements under Circular No. 747, the Board has
professional standards including the prevention of the bank
approved the Compliance Manual on 04 July 2012 and
being used for money laundering and terrorism financing. The
updated regularly to keep aligned with recent regulatory
MLPP is designed in accordance with the Bank’s corporate
requirements.
structure and risk profile. The MLPP is reviewed regularly to
incorporate therein recent regulatory issuances to ensure
compliance.

China Bank 56 Annual Report 2016

To foster compliance, the MLPP is disseminated to all officers includes among others, the development of various risk
and staff who are obligated by law and by the program to strategies and principles, control guidelines policies and
implement the same. Regular AML trainings and seminars procedures, implementation of risk measurement tools,
are being conducted to update all officers and staff of AML monitoring of key risk indicators, and the imposition and
requirements. The Bank has also adopted an AML e-Learning monitoring of risk limits. The RMC regularly reviews China
platform to expand the reach of AML training nationwide Bank’s risk profile and the effectiveness of risk management
expeditiously. For 2016, AML e-Learning platform has covered systems. Moreover, internal auditors test and evaluate
almost one hundred percent (100%) of its officers and staff. our risk management program to determine effectiveness
and communicate the results to the Board and the Audit
The Board and Senior Management regularly undergo training Committee.
on AML, among others. The recent AML training was provided
by the Anti-Money Laundering Council (AMLC). The Risk Management Group (RMG), headed by our Chief
Risk Officer, First Vice President Ananias S. Cornelio III, is
The AML Compliance Framework of China Bank is supported responsible for executing the risk management function and
by an electronic system capable of monitoring risks associated the guidelines set by the RMC, including the identification and
with money laundering. These AML and KYC measures are evaluation on a continuous basis of all considerable risks to
constantly subjected to independent and periodic review of the business, and challenging business lines on all aspects of
our internal auditors as part of their audit program. In addition, risks arising from the Bank’s activities.
a compliance testing is required by the BSP as an additional
control to ensure compliance. The results of these audits and In 2016, RMG continued to strengthen China Bank’s risk
testing are reported to the Board through the appropriate management framework to effectively assess, manage,
board level committees. These systems and measures are and monitor risks across a broad range of activities. Major
regularly evaluated and enhanced by China Bank to keep initiatives were taken to increase the technical capacity of
in pace with the developing standards, current trends and the group in credit risk model development and validation.
requirements. Foundation for the Bank’s adoption of the Basel III framework
on liquidity risk management has been prepared. On
China Bank affirms that it will uphold compliance with AML Information Technology, emphasis was given on cyber
laws and regulations. security and core system testing on disaster preparedness
was completed.
Risk Management
We recognize that the business of banking necessarily entails
risk, and that proper risk mitigation, not outright risk avoidance,
is the key to long-term success. Our risk management
principle centers on determining how much risk we are willing
to bear for a given return, deciding if the risks represent viable
opportunities, and finding intelligent approaches to managing
risks. Our corporate governance structure keeps pace with the
changing risks that China Bank faces and will be facing in the
coming years with a dynamic risk management program that
calls for the continuing reassessment of risks and controls and
the timely reporting of these risks to the Board.

As mandated under existing regulations, the Board is

responsible for the approval and overseeing the implementation
of risk management policies. The Board has delegated this (L-R) Marissa B. Espino (Compliance),
Marilyn G. Yuchenkang (Audit), Corazon I. Morando
function to the Risk Management Committee (RMC) which
(Corporate Secretary), Maria Rosanna L. Testa,
and Geoffrey D. Uy (Market Risk)

China Bank 57 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Market and Liquidity Risk The measurement of balance sheet interest rate and liquidity
The objective of our market risk policies is to obtain the best risk exposures are automated through the Asset and Liability
balance of risk and return while meeting our stakeholders’ Management (ALM) system that was implemented in 2013.
requirements. Meanwhile, our liquidity risk policies center on This important information on the Bank’s exposures generates
maintaining adequate liquidity at all times to be in a position insights that lead to the formulation of timely and effective
to meet all obligations as they fall due. RMG continued interest rate strategies and funding plans. Also in 2016,
to implement its roadmap including enhancements and the ALM system version was upgraded to include module
projects in support of these objectives. for generating LCR. The Bank engaged the services of an
external consultant in 2013 for the independent validation
Budget and capital considerations (Pillar II guidelines) are now of these risk measurement models, and included in the
effectively embedded into risk taking activities via the Valueat- engagement was the capacity building of the IAD to perform
Risk (VaR) limits. The annual VaR Limits review incorporates model validations.
the impact of VaR on Capital Adequacy Ratio (CAR) as a
basis for establishing limits, in addition to the annual trading Since 2014, the internal risk measurement models—VaR,
budget, past utilization and the Bank’s risk tolerance. Aside EaR and MCO are independently validated by the Bank’s
from using VaR as a risk metric, market risk is adequately IAD on an annual basis. Latest validation results concluded
managed through a risk management framework comprising that the Bank’s VAR, EAR and MCO models are appropriate
of limits, triggers, monitoring and reporting procedures. for measurement of its market, interest rate, and liquidity
As part of its 2016 roadmap, the Bank has implemented risk, respectively.
a market risk system last May which has enhanced and
automated the measurement of VaR. On stress testing, RMG continued using an Integrated
Stress Testing (IST) framework for the March 2016 Internal
For interest rate risk, the Earnings-at-Risk (EaR) estimates Capital Adequacy Assessment Process (ICAAP) submission
using actual interest rate volatilities and non-parallel yield in addition to the silo stress tests already in place such
curve shifts have been included in the regular reporting as Volatility, Uniform, and Reverse Stress Tests. The IST
to the RMC to supplement the Bank’s EAR analysis. To complements the Internal Models Approach which is the
further enhance its analysis of the Bank’s accrual portfolio basis for ICAAP capital charge under normal environment.
the Bank will continue to explore other metrics such as the The IST framework allows us to evaluate China Bank’s overall
measurement of Balance Sheet VaR. vulnerabilities on specific events or crisis and gauge the
Bank’s ability to withstand stress events.
For interest rate risk, the Earnings-at-Risk (EaR) estimates
using actual interest rate volatilities and non-parallel yield Credit Risk
curve shifts have been included in the regular reporting Our policies for managing credit risk are determined at the
to the RMC to supplement the Bank’s EAR analysis. To business level with specific procedures for different risk
further enhance its analysis of the Bank’s accrual portfolio environments and business goals. For 2016, the Bank
the Bank will continue to explore other metrics such as the continued to develop new credit risk rating and scoring
measurement of Balance Sheet VaR. models and enhance existing ones, following the enterprise-
wide roadmap approved by the Board of Directors. After
Aside from the Maximum Cumulative Outflow (MCO) model completing the quantitative and qualitative validation of the
used for managing and monitoring liquidity risk, RMG Internal Credit Risk Rating System (ICRRS) in 2014 and the
formed a team to spearhead the Bank’s adoption of Basel recalibration of the model in 2015 with the technical support
III International Framework for Liquidity Risk Measurement, of Moody’s Analytics, the Bank proceeded with the parallel
Standards and Monitoring in 2014. The team includes testing of the recalibrated model against the existing model
representatives from Treasury and Accounting who are in 2016. It has also adopted a risk-based pricing policy using
responsible for managing the Bank’s liquidity and financial the new credit scoring model.
regulatory reporting. In 2016, the Bank adopted the final LCR
guidelines from BSP Circular No. 905 and began reporting the In addition, the Bank completed the statistical validation of its
results to the regulator. Borrower Credit Score (BCS) which is the scoring model for

China Bank 58 Annual Report 2016

retail small and medium entities and individual loan accounts As part of its responsibility, RMG spearheads the bank-wide
using the same methodology applied to the validation of operational risk identification and self-assessment process.
the corporate risk rating model. The validation process was A mechanism that enables the Bank to determine priority
conducted with the assistance of Teradata which provided the risks areas, ascertain that proper checks and balances are
analytics platform, tools and technical guidance for both credit in place, and introduce additional measures to strengthen
model performance assessment and recalibration. Likewise, overall operational controls. In addition, the Bank maintains
the Bank adopted a new scorecard for consumer lending, a Centralized Loss Database (CLD) where all the reported
specifically, housing and auto loans which will be subjected incidents of losses are recorded. Information captured are
to model validation as soon as sufficient amount of data is processed and analysed with the results used to pinpoint
captured. general control weaknesses and operational vulnerabilities.
The Bank also collects data to establish the appropriate Key
A Sovereign Risk Rating Model was also introduced. This Risk Indicators with the corresponding thresholds which are
provided the tool for the Bank to assess the strength of the monitored on a periodic basis.
country rated with reference to its economic fundamentals,
fiscal policy, institutional strength, and vulnerability to The Bank has a risk-based and scenario driven Business
extreme events. Continuity Management (BCM) Program where the primary
objective is to have the capability and assure the level of
The Bank continued to strengthen its management of preparedness needed to restore business processes in
large exposures and concentration risk by considering the event of a major disruption. The program includes the
economic interdependence as provided under Circular 855. development of appropriate resiliency strategies, recovery
Management Action Trigger (MAT) on sovereign exposures procedures, facilities, contingency measures, communication,
was introduced as well. and crisis management plans across the organization.
Another component of the program is the Business Impact
In 2016, the Credit Review and Control Department, an Analysis (BIA) which is necessary to identify critical business
independent review team within RMG, was able to cover a process and system dependencies. The results of the BIA are
total of eight lending units from Consumer Banking, Institutional subsequently used to further enhance the Bank’s recovery
Banking and Retail Banking in its credit examination accounting strategy and appropriately align with defined Recovery Time
for 12% of the Bank’s Total Loan Portfolio. The scope of Objectives (RTO). The Bank executed several tests and
examination was extended to cover specific borrowers in major simulation exercises in 2016 to assess its level of preparedness
industries that the Bank is exposed to. The review of the loan in the event of major disasters or events adversely affecting
portfolio under the Trust and Asset Management Group of the operations. Alongside the Bank’s IT Audit and Information
Bank was also completed during the year. The standard credit Security Office, the disaster preparedness was thoroughly
examination covers the assessment of loan portfolio quality and assessed, covering both infrastructure and procedural matters.
adherence to existing credit policies and procedures as well as Standards set under existing regulations and industry best
the validation of impairment process. practices were used to benchmark the Bank’s ability to
respond to different scenarios.
Lastly, enhancement in policies and procedures were made
to comply with the new set of requirements provided in BSP On Information Technology, the Bank has established a robust IT
Circular No. 855 which took effect in November 2016. Risk Management Framework anchored on its business strategy,
capabilities, and risk appetite. The IT Risk Management practices
Operational and IT Risk of the Bank is governed by the standards and operating
The Bank has a framework of policies, procedures, and principles provided in BSP Circular No. 808 (Guidelines on IT
tools to ensure that China Bank’s operational and IT risks are Risk Management). The IT risk assessment process serves
managed in a timely and efficient manner. RMG continues to as the main tool of the Bank in identifying vulnerabilities and
effectively assess, monitor, control, and communicate such determining the effectiveness of IT controls.
risks as well as take initiatives to further improve the Bank’s
disaster preparedness.

China Bank 59 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Trust Risk If the report is deemed well-substantiated, the CCO shall

On August 17, 2012, BSP came out with Circular 766, turn over the disclosure to the Audit Division and/or HRD for
Guidelines in Strengthening Corporate Governance and further investigation. Should the report be deemed baseless,
Risk Management Practices on Trust, Other Fiduciary within 24 hours from receipt thereof, the CCO shall inform
Business, and Investment Management Activities. The the whistleblower of its status without prejudice to its re-
circular mandates Trust entities to “develop and implement submission.
a formal, comprehensive, and effective risk management
program that outlines, among other things, the risk Any meritorious disclosures will be given due recognition and
management processes that effectively identify, measure, may be eligible for a reward as determined by the HRD or
monitor and control risks affecting the clients and the Trust the Investigation Committee. All disclosures, their statuses,
Entity.” In line with this, RMG continued to strengthen China and resolutions are regularly reported to the Compliance and
Bank’s risk management practices on Trust by enhancing Corporate Governance Committees.
the policies, processes, and procedures for market risk,
liquidity risk, credit risk, operational risk and compliance Reports/disclosures may be sent to any officer of the Bank or to:
risks specific to the Trust Group. Legal, Strategic and
Reputational Risks were also incorporated in the Trust Risk CHIEF COMPLIANCE OFFICER
Management Guidelines. In 2016, changes were applied China Banking Corporation
to improve the accounts review process and the trading P. O. Box 2182, Makati Central Post Office
parameters for Unit Investment Trust Funds or UITF. 1226 Makati City, Philippines
Mobile number: 0947-9960573
III. GOVERNANCE AND ETHICAL E-mail address: [email protected]
OPERATIONAL POLICIES A disclosure form is also available at
With the guidance set by the policies in China Bank’s By- www.chinabank.ph
Laws, Corporate Governance Manual, Compliance Manual,
and Code of Ethics, the Board and Senior Management Conflict of Interest
mindfully directs the governance of the Bank. In doing so, In accordance with the Bank’s Code of Ethics, Conflict of interest
they abide by its mandate to comply with all relevant laws between the Bank and its employees should be avoided at all
and operate as a responsibly profitable business, working for times. However, should a conflict arise, the interest of the Bank
the best interests of our stakeholders. must prevail. Employees are not permitted to have or be involved
in any financial interests that are in conflict or appear to be in
Whistleblowing conflict with their duties and responsibilities to China Bank. They
The Bank does not and will not tolerate unethical conduct, are likewise barred from engaging in work outside of the Bank
thus a Whistleblowing mechanism was established to unless with duly-approved permission, as well as work that lies in
ensure that employees, customers, shareholders, and direct competition with the Bank.
third party service providers will have a way to report
questionable activity, unethical conduct, fraud or any other Restriction In Dealings On Bank Securities
malpractice by mail, phone or e-mail, under the strictest China Bank employs strict policies on securities transactions
measures of confidentiality and anonymity to allay fears of to support and uphold all applicable laws against insider
reprisal or retaliation. trading. This prohibits directors, officers, and employees
who are considered to have knowledge of material facts or
The Bank’s Chief Compliance Officer (CCO) will determines changes in the affairs of China Bank which have not yet been
the substance and validity of all whistle-blower reports. publicly disclosed—including any information likely to affect
Reports can also be disclosed to any officer of the bank, the share price of the Bank’s stock—to directly or indirectly
the Risk Management Group, Internal Audit and the HRD. engage in financial transactions that make use of “insider

China Bank 60 Annual Report 2016

information”. This also includes consultants and advisers no negative impact on stakeholders. This entails a thorough
and all other employees who are made aware of undisclosed evaluation on the procurement’s risk to personnel, company
material information. assets, the environment, equipment, and service to customers.
Consequently, we only transact with suppliers who have
Any transactions by the Directors involving the Bank’s shares been assessed to have the necessary experience, capability,
are required to be disclosed within three business days from and financial viability, and conduct business using economic,
the date of the transaction. environmental and professionally sound methods while
remaining compliant to all applicable laws and regulations.
Anti Bribery & Corruption Policy
China Bank is committed to honest and ethical business China Bank is committed to fair market practices, engaging
practices and does not tolerate any form of bribery and in the services of suppliers and contractors that have
corruption. We take our legal responsibilities very seriously passed through a legitimate evaluation process that ensures
and expect our directors and employees at all levels and a fair competition among other service providers under
grades to do the same. China Bank directors and employees consideration. The Bank follows standards of objectivity,
are to act professionally, fairly, and with integrity in all our impartiality and equal opportunity, and evaluates based on
business dealings and relationships wherever we operate; thorough criteria such as quality, price, service, and overall
thus, they 1) must never offer, promise, or give a financial value to the business, ensuring that we prevent any favouritism
or other advantage to any person or party, including or conflicts of interest. All prospective suppliers must also
public officials, with the intention of inducing or rewarding undergo and pass a preliminary accreditation process before
improper performance by them of their duties or to facilitate any contract is awarded to them. They are also assessed on
the transaction of the Bank, and 2) must never directly or their actual performance as compared to promised delivery
indirectly accept or agree to receive a financial or other dates, quality of work / goods, and adherence to agreed
advantage as a reward for performing any act prejudicial to specifications and purchase order prices.
the Bank, the director/employee himself, or a third party.
Disclosure and Transparency
Education and Training The Bank is a staunch advocate of transparency and
China Bank’s compliance culture is constantly reinforced accountability, maintaining a high standard of disclosure to
through education and training. The Compliance Office facilitate public understanding of the Bank’s financial condition
regularly briefs Compliance Coordinators in all branches and and the state of its corporate governance in order for them
head office units to raise their awareness and understanding to make a well-informed decision. All material information
of the principles and concepts of good corporate governance, about China Bank is adequately and promptly disclosed in
with which they are required to cascade to their respective accordance with SEC and PSE’s disclosure policy like the
colleagues. All new hires of the Bank are given mandatory publication of our quarterly financial statements in national
orientations on Compliance Systems, Anti-Money Laundering, broadsheets and presentation of a detailed annual report for
Whistle-Blowing, and Corporate Governance. Lectures our Stockholders’ Meetings. Furthermore, we disclose market-
on compliance are also conducted during the Officers sensitive information like dividend declarations, joint ventures
Development Program (ODP) and Integrated Supervisory and acquisitions, sale and disposition of significant assets,
Development Program (ISDP). as well as financial and non-financial information that may
affect the decision of the investing public via press releases on
Supplier/Contractor Selection broadsheets and internal publications. We also electronically file
We practice utmost professionalism in managing the Bank’s our disclosures through the Electronic Disclosure Generation
resources. We process all matters of due diligence and Technology (Edge) of PSE, making them available on the PSE
compliance to ensure that any service or goods procurement website. Our corporate website is likewise regularly updated to
will pose the greatest benefit to the Bank, while posing little to include the latest news and current information about the Bank.

China Bank 61 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

Social Media Policy

China Bank’s expansive brand of customer and public service
spans all modern channels of communication including social
media and online networking platforms. The Bank’s social
media presence is guided by the mandate of its Code of
Ethics, and is one of the first in the industry to have policies
in place to ensure that our employees’ interaction with
the online public is consistent with the Bank’s core value
of professionalism. Social Media Administrators serve as
overseers of any online posts made in the Bank’s name. In the
same way, employees are constantly instructed and reminded
to extend their professional demeanor to their personal online
interactions. China Bank employees are cautioned to abide relationship to the bank and interest in the transaction; the
by the policies on personal posts, comments and statements material facts of the proposed related party transaction,
relating to the Bank, that they may avoid online publication including the proposed aggregate value of the transactions;
of any content or statement disparaging the Bank or its the benefits to the Bank; the availability of other sources of
clients, or otherwise jeopardize the Bank’s and its clients’ comparable products or services; and an assessment of the
interests. They are likewise informed against posting of transaction on terms and conditions that are comparable
prohibited content such as incitement to commit crime, drug to the terms generally offered to unrelated parties under the
paraphernalia, pornographic media, and the like. The Bank similar circumstances and the price discovery mechanism
continues to exert efforts to enhance its social media policies adopted to determine fair price.
to better accommodate the guidelines on mitigating social
media risk issued by the BSP. The Bank has an extensive RPT policy that is kept updated,
relevant and aligned with laws, rules and regulations. Based
Related Party Transactions on the existing policy of the Bank, a transaction is deemed
Transactions with related party are not prohibited under material if it is P50 Million and above.
existing rules. However, due to the possibility of a conflict of
interest, the Bank is careful in dealing with related parties. All To avoid conflict of interest and based on the RPT policy of
material related party transactions are reviewed by the Related the Bank, any director who has interest in a transaction is
Party Transaction Committee before they are endorsed to the required to disclose their interest in the transaction and should
Board for approval. Any related party transactions should be abstain from the deliberation and approval of the related party
conducted at an arm’s length basis, determined to be in the transaction.
best interest of the Bank, in the ordinary course of business,
and on substantially the same terms as those offered with The table on page 63 shows the Bank’s significant (P50M and
other parties. above) related party transactions as of December 2016. Full
disclosures for these transactions were made through reports
In the evaluation of the transaction, the following, among with the appropriate regulatory agency, and such significant
others are considered by the RPT Committee: related party’s RPT are ratified by the stockholders at the annual meeting.

China Bank 62 Annual Report 2016

SIGNIFICANT RELATED PARTY TRANSACTIONS AS OF DECEMBER 2016

Name of Counterparty Type of Transaction Amount/Contract Price

JJACCIS Development Corp. Line Renewal P500.0 Mn
Suntree Holdings Corp.
(Stockholder) Outstanding P360.5 Mn
Angela T. Dee-Cruz Line Renewal P51.0 Mn
(Officer of the Bank) Outstanding P8.5 Mn
P669.3 Mn
Special Savings Placement
P689.0 Mn
P727.9 Mn
Investment in SSA
P150.0 Mn
P850.0 Mn
China Bank Savings Inc. P450.0 Mn
(Subsidiary) Bonds P100.0 Mn
P100.0 Mn
P110.0 Mn
Short Term Borrowing P300.0 Mn
Line Renewal P200.0 Mn
Investment in $ CTD $200.0 Mn
China Bank Savings Inc. – Trust Bonds P160.0 Mn
(Subsidiary)
BDO Universal Bank P22.3 Bn
(Affiliate) P19.5 Bn
P150.0 Mn
P356.0 Mn
P1.5 Bn
Bonds/FX P621.5 Mn
P5.6 Bn
P200.0 Mn
P93.2 Mn
P4.2 Bn
P3.4 Bn

BDO Private Bank, Inc. P2.7 Bn

(Affiliate) Bonds / FX
P50.0 Mn
P994.4 Mn

CBC Trust Group P100.0 Mn

(A Group in the Bank) Bonds
P654.0 Mn
Manulife Chinabank Life Assurance Corp. P54.1 Bn
(Associate) P968.0 Mn
P237.9 Mn
P200.0 Mn
Bonds
P310.4 Mn
P850.0 Mn
P469.4 Mn
P801.0 Mn
SM Investments Corp. (Stockholder)/ Line Renewal P15.5 Bn
Multi-Realty Dev’t Corp./ Sybase Equity Investments Corp. Grant of Term Loan P21.5 Bn
(Affiliates)
Outstanding P2.7 Bn
Line Renewal P5.0 Bn
Sysmart Corp. Outstanding P3.1 Bn
(Stockholder)
Trust Investment P100.0 Mn
SM Prime Holdings Inc./ Costa Del Hamilo, Inc./ SM Hotels and Conventions Line Renewal P3.0 Bn
Corp. Renewal of BP Line P100.0 Mn
(Affiliates)
Summerhills Home Development Corp. Line Renewal P500.0 Mn
(Affiliate)
Henry Sy Line Renewal / P300.0 Mn
(Stockholder) Outstanding
Line Renewal P1.0 Bn
SM Development Corp. Renewal of BP Line P50.0 Mn
(Affiliate)
Short Tem Fund Investment P99.9 Mn
Line Renewal P47.0 Mn
Spouses Irwin Marland & Consuelo Dee Ponce P80.0 Mn
(Related Interest)
Outstanding P120.6 Mn
Cityland Development Corporation Sale of Foreclosed Asset P84.0 Mn
(Related Interest)
Super Industrial Corp. Line Renewal P50.0 Mn
(Affiliate)
China Bank Capital Corporation Money Market Fund Investment P50.0 Mn
(Subsidiary)
Union Motors Corp. Line Renewal P150.0 Mn
(Affiliate)
Multi-Realty Dev’t Corp./ Sybase Equity Investments Corp. Grant of Term Loan P8.0 Bn
(Affiliates)
Elizabeth T. Sy Trust Placement P50.0 Mn
(Related Interest)

China Bank 63 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

IV. INFORMATION FOR STOCKHOLDERS

DATE OF FOUNDATION
China Bank was incorporated on July 20, 1920 and opened for business on August 16, 1920. The Bank is registered with
the Securities and Exchange Commission under SEC registration number 443. China Bank’s amended By-laws may be
downloaded from our website, www.chinabank.ph, or requested from the Office of the Corporate Secretary:

ATTY. CORAZON I. MORANDO

Vice President and Corporate Secretary
11/F China Bank Building
8745 Paseo De Roxas corner Villar Street
Makati City 1226, Philippines
Tel. Nos.: (+632) 885-5131, 885-5132
Fax No.: (+632) 885-5135
Email: [email protected]

RECORD AND BENEFICIAL OWNERS HOLDING 5% OR MORE OF VOTING SECURITIES AS OF FEBRUARY 28, 2017:

Name of Beneficial
Name, Address of Record Owner & Owner & No. of
Citizenship Percentage
Title of Class Relationship with Issuer Relationship with Shares Held
Record Owner
PCD Nominee Corporation *
37th Floor Tower I, The Enterprise Center,
Various
Common 6766 Ayala Ave. corner Paseo de Roxas, Non-Filipino 513,070,793 25.63%
stockholders/clients
Makati City
Stockholder
SM Investments Corporation Sy Family
10th Floor L.V. Locsin Bldg., PCD Nominee
Common Filipino 344,493,881 17.21%
6752 Ayala Avenue, Makati City Corporation
Stockholder Stockholders
Henry Sy, Sr. and
Sysmart Corporation
Family
10th Floor L.V. Locsin Bldg.,
Common Sycamore Pacific Filipino 296,604,070 14.82%
6752 Ayala Avenue, Makati City
Corporation
Stockholder
Stockholders
PCD Nominee Corporation *
37th Floor Tower I, The Enterprise Center,
Various
Common 6766 Ayala Ave. corner Paseo de Roxas, Filipino 244,606,202 12.22%
stockholders/clients
Makati City
Stockholder
• Based on the list provided by the Philippine Depository & Trust Corporation to the Bank’s transfer agent, Stock Transfer Service, Inc., as of
February 28, 2017, The Hongkong and Shanghai Banking Corporation Limited (295,842,164 shares or 14.777%) holds 5% or more of the
Bank’s securities. The beneficial owers, such as the clients of PCD Nominee Corporation, have the power to decide how their shares are
to be voted.

China Bank 64 Annual Report 2016

AUTHORIZED AND ISSUED CAPITAL Adjusted Prices (due to 8% stock dividend):
Authorized Capital: P25.0 Billion divided into 2.5 Billion 2016 HIGH LOW CLOSE
shares with a par value of P10.00 per share Jan – Mar 36.57 31.02 36.25
Issued Shares: 2,002,027,836 common shares Apr – Jun 38.50 35.23 38.00
Jul - Sept 39.00 37.60 38.00
SUMMARY OF FILIPINO AND NON-FILIPINO HOLDINGS Oct - Dec 38.30 37.60 38.00
AS OF FEBRUARY 28, 2017
Actual Prices:
Nationality Number of Number of Percentage 2015 HIGH LOW CLOSE
Stockholders Shares
Jan – Mar 44.40 42.55 46.50
Filipino 1,879 1,482,483,430 74.049%
Apr – Jun 44.86 41.67 45.30
Non-Filipino (PCD) 1 513,070,793 25.628%
Jul – Sept 43.80 40.40 41.00
Chinese 48 3,102,937 0.155%
Oct – Dec 42.00 37.00 37.20
American 19 2,182,715 0.109%
Australian 1 1,811 0.000%
British 1 90,390 0.005% Adjusted Prices (due to 8% stock dividend):
Canadian 3 582,303 0.029% 2015 HIGH LOW CLOSE
Dutch 1 57,590 0.003% Jan - Mar 38.06 36.48 39.87
Spanish 1 99 0.000% Apr - Jun 38.46 35.72 38.84
Taiwanese 2 455,768 0.023% Jul - Sept 37.55 37.41 37.96
TOTAL 1,956 2,002,027,836 100.00% Oct - Dec 38.89 34.26 34.44

MARKET INFORMATION Market value as of December 29, 2016 (last trading day):
Principal market where the equity is traded – Philippine P38.00
Stock Exchange, Inc. (PSE) Price Information as of February 28, 2017
(latest practicable trading date): P40.00
Actual Prices:
2016 HIGH LOW CLOSE
Jan – Mar 39.50 33.50 39.15
Apr – Jun 40.25 37.00 38.00
Jul – Sept 39.00 37.60 38.00
Oct – Dec 38.30 37.60 38.00

China Bank 65 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

TRADING IN COMPANY SHARES BY BANK DIRECTORS AND PRINCIPAL OFFICERS

as of February 28, 2017:

Shareholdings as of Number of Shares Number of Shares Shareholdings as of

Director
January 1, 2016 Disposed Acquired December 31, 2016
Hans T. Sy 2,324,601 - 259,468 2,584,069
Gilbert U. Dee 9,863,624 - 789,090 10,652,714
Ricardo R. Chua 100,609 - 8,050 108,659
Peter S. Dee 1,206,325 1,023,845 96,506 278,986
Joaquin T. Dee 35,687,755 - 2,855,022 38,542,777
Herbert T. Sy 352,543 - 28,204 380,747
Harley T. Sy 180,356 - 14,429 194,785
Alberto S. Yao 6,128 - 491 6,619
Roberto F. Kuan 23,297 - 1,864 25,161
Jose T. Sio 2,428 - 195 2,623
*Mr. Tiong was an Independent Director of the Bank until his passing on September 16, 2016

Officer Shareholdings as of Number of Shares Number of Shares Shareholdings as of

January 1, 2016 Disposed Acquired December 31, 2016
William C. Whang - - 13,063 13,063
Rosemarie C. Gan 89,782 - 7,183 96,965
Patrick D. Cheng 401,195 - 56,296 457,491
Gerard T. Dee 5,429 - 435 5,864
Angela D. Cruz 1,132,268 - 90,583 1,222,851
Delia Marquez 15,959 - 1,277 17,236
Lilibeth R. Cariño 2,823 - 226 3,049
Renato K. de Borja, Jr. - - 500 500
Shirley G.K.T. Tan 11,027 - 883 11,910
Elizabeth C. Say 2,372 - 189 2,561

China Bank 66 Annual Report 2016

DIVIDEND POLICY Capital Management broadly follows the process outlined
China Bank, as a matter of policy, will declare cash dividends below:
at a payout ratio of at least thirty percent of the net income 1. An assessment of regulatory capital and capital adequacy
of the prior year, subject to the conditions and limitations set measures.
forth in this policy statement. The Bank’s Dividend Policy is 2. Determination of the optimal capital structure based on a
an integral component of its Capital Management Policy and risk-based capital planning approach that considers:
Process rather than a standalone process. Its fundamental a. Planned levels and risk appetite for business activity with
and overriding philosophy is sustainability. a focus on the implication of these plans on the resulting
credit, market, and operational risk exposure.
Dividend pay-outs are reviewed annually. These are b. An analysis of the implications of macroeconomic
referenced against the Bank’s Capital Management Process. activity or industry developments and probability of a
Based on the Capital Management Process, dividend payouts corresponding improvement or deterioration in the Bank’s
are calibrated based on the prior year’s earnings while taking risk exposures.
into consideration dividend yields, future earnings streams c. Provision of a capital buffer to mitigate against an
and future business opportunities. unforeseen deterioration in the bank’s asset portfolio
quality, or an increase in business risk, or business
In declaring dividend pay-outs, China Bank uses a opportunities that arise over the course of its business
combination of cash or stock dividends as follows: activities.
1. The dividend is increased in response to the Bank’s d. Desired capital mix, leverage, and target return on equity.
achieving a higher level of sustainable earnings. e. Accretive or dilutive effects of incremental capital buildup
2. Dividends may be increased for a specific year to plow programs.
back to shareholders a commensurate share of unusually f. Developments or opportunities in the capital markets or
high earnings for a given year. regulatory environment that have a direct relation to the
Bank’s ability to build up or reduce its capital levels.
China Bank capital management philosophy and process, and g. Sustainability of internally generated capital and
consequently its Dividend Policy which comprises an integral consequently sustainability of dividend payoffs.
component of this undertaking, is driven by the following
primary objectives:
1. Ensuring compliance with externally imposed regulatory DIVIDEND HISTORY
capital requirements. 2016 2015 2014 2013 2012
2. Maintaining strong credit ratings. Stock Dividend 8% 8% 8% 10% 10%
3. Maintaining healthy capital ratios to support its business Cash Dividend 10% 10% 10% 12% 12%
and maximize shareholder value.
INVESTOR RELATIONS
China Bank manages its capital structure and makes Inquiries from investors, analysts, and the financial community
adjustments to it in the light of: are handled by the Investor Relations Office:
1. Changes in economic conditions.
2. The risk characteristics of its activities. ALEXANDER C. ESCUCHA
Senior Vice President and Head
3. The assessment of prospective business requirements or
Investor and Corporate Relations Group
directions.
28/F BDO Equitable Tower
8751 Paseo De Roxas
Management of and adjustments to the capital structure are
Makati City 1226, Philippines
accomplished through the following principal means: Tel. No.: (+632) 885-5609
1. Adjustments of dividend pay-outs to shareholders Email: [email protected]
2. Adjustments in form of dividend pay-outs (cash vs. stock)
3. The issuance or, conversely, reduction of capital securities

China Bank 67 Annual Report 2016

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

AWARDS AND RECOGNITION

BELL AWARD FOR CORPORATE GOVERNANCE 2016 (Also 2012, 2013, 2014 and 2015)
Philippine Stock Exchange (PSE) - Top 5 listed companies

BANKING & FINANCE FIRM OF THE YEAR - PHILIPPINES

Finance Monthly M&A Awards - Finance Monthly (U.K.)

BEST BANK GOVERNANCE - PHILIPPINES 2016

CFI.co Awards 2016 - Capital Finance International (U.K.)

BEST CORPORATE GOVERNANCE BANK - PHILIPPINES 2016

Global Banking & Finance Review Awards - Global Banking & Finance Review (U.K.)

ASIAN CORPORATE DIRECTOR RECOGNITION AWARD - MR. HANS T. SY (Chairman)

12th Corporate Governance Asia Recognition Awards, The Best of Asia 2016 - Corporate Governance Asia

ASIA PACIFIC ENTREPRENEURSHIP AWARD

Financial Services Industry - President and CEO Ricardo R. Chua
Asia Pacific Entrepreneurship Awards (APEA) 2016 - Enterprise Asia

BEST INVESTOR RELATIONS BANK - PHILIPPINES

Global Banking & Finance Review Awards - Global Banking & Finance Review (U.K.)

BEST INVESTOR RELATIONS COMPANY - PHILIPPINES (CHINA BANK)

ASIA'S BEST CEO (INVESTOR RELATIONS) - President and CEO Ricardo R. Chua
BEST INVESTOR RELATIONS PROFESSIONAL - PHILIPPINES (SVP for Investor Relations Alexander C. Escucha)
The 6th Asian Excellence Awards 2016 - Corporate Governance Asia

PRSP ANVIL AWARDS 2016 - BEST PR TOOLS, ANNUAL REPORT

Public Relations Society of the Philippines (PRSP)

China Bank 68 Annual Report 2016

BEST BANK FOR DEBT CAPITAL MARKETS - PHILIPPINES
Global Banking & Finance Review Awards - Global Banking & Finance Review (U.K.)

BEST BOND HOUSE - CHINA BANK CAPITAL CORPORATION

2016 Triple A Country Awards - The Asset Magazine

TOP 5 CORPORATE ISSUE MANAGER / ARRANGER - INVESTMENT HOUSE CATEGORY (CHINA BANK CAPITAL CORPORATION)
12th PDS Awards Night - Philippine Dealing System

P31.97 B THERMA VISAYAS PROJECT FINANCING DEAL - MOST INNOVATIVE DEAL - PHILIPPINES
2016 Triple A Asia Infrastructure Awards - The Asset Magazine

P42.15 B SAN BUENAVENTURA POWER PROJECT FINANCING DEAL - BEST POWER DEAL - PHILIPPINES
2016 Triple A Asia Infrastructure Awards - The Asset Magazine

P33.3 B SAN MIGUEL BREWERY LOCAL CURRENCY BONDS ISSUE

2016 Triple A Regional Investment Awards - The Asset Magazine

BEST MANAGED FUND FOR BOND FUND LONG-TERM DOLLAR CATEGORY (China Bank Dollar Fund)
Best Managed Fund of the Year - CFA Society Philippines

BEST CORE BANKING IMPLEMENTATION - PHILIPPINES 2016

Global Banking & Finance Review Awards - Global Banking & Finance Review (U.K.)

BEST COLLECTING COMMERCIAL BANK

Best Collection Partners - Social Security System

STP AWARD
Straight-through Processing Award - New York Bank (BNY Mellon)

BEST INDIVIDUAL IN TRADING, PHILIPPINES, RANK 1 – DANICA SHASHA U. TAN, TREASURY TRADER
BEST INDIVIDUAL IN TRADING, PHILIPPINES, RANK 2 – CRISTINA P. ARCEO, VICE PRESIDENT TREASURY
(5-time awardee among top 3)
The Benchmark Research Awards for Research, Sales & Trading 2016 – The Asset Magazine

China Bank 69 Annual Report 2016

BOARD OF DIRECTORS

HENRY SY, SR. HANS T. SY

China Bank 70 Annual Report 2016

GILBERT U. DEE RICARDO R. CHUA PETER S. DEE

China Bank 71 Annual Report 2016

BOARD OF DIRECTORS

HERBERT T. SY JOAQUIN T. DEE HARLEY T. SY

China Bank 72 Annual Report 2016

JOSE T. SIO ROBERTO F. KUAN ALBERTO S. YAO

China Bank 73 Annual Report 2016

BOARD OF DIRECTORS

HANS T. SY, 61, Filipino, is the GILBERT U. DEE, 81, Filipino,

Chairman of the Board since is the Vice Chairman of the
May 5, 2011. He first served Board since May 5, 2011. He
as member of the China Bank was first elected to the China
Board on May 21, 1986, until Bank Board on March 6, 1969,
his election as Vice Chairman and served as Chairman from
in 1989. Aside from China 1989 to 2011. Aside from PSE-
Bank, Chairman Sy currently listed China Bank, he also
serves in the Boards of SM Prime Holdings, Inc. (as serves as the Chairman of the Boards of Union Motor
Director and Chairman of the Executive Committee) Corporation and China Bank subsidiary CBC Properties
and SM Investments Corporation (as Adviser to the and Computer Center, Inc. (CBC-PCCI), and as Director
Board), both of which are listed in the Philippine Stock of Super Industrial Corporation, which are all non-listed
Exchange (PSE). He likewise occupies positions in companies. He was previously on the boards of Philippine
various companies of the SM Group. He graduated Pacific Capital Corporation, Philex Mining Corporation,
from the De La Salle University with a degree in and CBC Finance Corporation, and President of GAB
Mechanical Engineering. Over the years, Chairman Sy Investment Corporation. Vice Chairman Dee holds a
had attended various seminars, among which are the Bachelor of Science degree in Banking from the De La
Anti-Money Laundering (AML) Training and Corporate Salle University, and a Masters in Business Administration
Governance Training Programs conducted by the (MBA) degree in Finance from the University of
Bangko Sentral ng Pilipinas (BSP) and the Institute of Southern California. His trainings include the Corporate
Corporate Directors (ICD). Governance Training Program in November 2016 and
AML training in August 2014.
HENRY SY, SR., 92, Filipino,
is the Honorary Chairman RICARDO R. CHUA, 65, Filipino,
and Advisor to the Board is a Director of the Bank since
since 1997. His election as May 8, 2008. He is also the
Honorary Chairman on May President and Chief Executive
18, 2006 was formalized Officer since September 1, 2014.
on February 7, 2007 after He currently serves as member
clearances from the BSP of the boards of China Bank
and the Securities and Exchange Commission (SEC) subsidiaries China Bank Savings,
were obtained. He is also the Chairman of PSE- Inc. (CBSI), Chinabank Insurance Brokers, Inc. (CBC-IBI),
listed companies SM Investments Corporation, BDO CBC-PCCI, and China Bank Capital Corporation (CBCC);
Unibank, Inc. (Emeritus), and SM Prime Holdings, Inc. Director of Manulife China Bank Life Assurance Corp.
(Emeritus). Mr. Sy holds an Associate in Commercial (MCBLife), and Banker‘s Association of the Philippines,
Science degree from the Far Eastern University and Director and President of BancNet, Inc., CAVACON
and was conferred a doctorate degree in Business Corporation, Stonebrothers, Inc., Genricland Properties,
Management Honoris Causa by the De La Salle Inc., and Sun & Earth Corporation, among others. Apart
University. from China Bank, he does not hold position in any other

China Bank 74 Annual Report 2016

company listed in the PSE. Previously, President Chua JOAQUIN T. DEE, 81, Filipino, has
was the Bank‘s Chief Operating Officer; he was also been on the Bank‘s Board since
at the boards of CBC Venture Capital Corporation, May 10, 1984. He does not hold
Philippine Clearing House Corporation, and CBC directorship position in any PSE-
Forex Corporation. A Certified Public Accountant, he listed company other than China
graduated with a Bachelor of Science degree in Business Bank; however, he is currently
Administration, Major in Accounting, cum laude, from Director/President of JJACCIS
the University of the East, and he holds a Masters in Development Corporation and
Business Management (MBM) degree from the Asian Enterprise Realty Corporation, and Director/Treasurer of
Institute of Management (AIM). President Chua has had Suntree Holdings Corporation. Previously, he was the Vice
extensive training in banking operations and corporate President for Sales and Administration of Wellington Flour
directorship, which include the Corporate Governance Mills from 1964 to 1994. Director Dee holds a Bachelor of
Training Program which he attended in November 2016, Science degree in Commerce from the Letran College. He
and AML Training for Directors in 2014. has had extensive training in banking – he attended ICD‘s
Corporate Governance Training Program in 2016, and
PETER S. DEE, 75, Filipino, BSP-AMLC‘s AMLA training in 2014.
has been on the China Bank
Board since April 14, 1977. He HERBERT T. SY, 60, Filipino, was
previously served as President elected as Director on January 7,
and Chief Executive Officer of 1993. Aside from China Bank, he
the Bank from 1985 to 2014. is also Director of PSE-listed SM
Presently, Director Dee serves Prime Holdings, Inc.; he currently
as independent director in the serves in other companies not
following PSE-listed corporations: City & Land Developers, listed at the PSE – as Chairman
Inc. and Cityland Development Corporation. He also holds in the Boards of Supervalue, Inc.,
directorships in other non-listed companies including Super Shopping Market, Inc., and Sanford Marketing
China Bank subsidiaries CBC-PCCI and CBC-IBI, Hydee Corp., and as member of the Board of the National
Management & Resources Corporation, Commonwealth University. He has been a director and/or officer for more
Foods, Inc., and GDSK Development Corporation. He was than five (5) years in companies engaged in food retailing,
formerly director in companies which include Sinclair (Phils.) investment, real estate development and mall operations.
Inc., Can Lacquer, Inc., and China Bank subsidiary CBC Director Sy is a holder of a Bachelor of Science degree
Forex Corporation. Director Dee is a graduate of the De La in Management from the De La Salle University. He
Salle University/University of the East with a Bachelor of attended various banking-related trainings, including the
Science degree in Commerce. He also completed a Special Corporate Governance Training Program in November
Banking course at the American Institute of Banking. He 2016 and AMLA training in August 2014.
has had trainings in various aspects of banking, including
the Corporate Governance: Towards the Right Direction in
November 2016 and the Exclusive Corporate Governance
Training for Directors in June 2015.

China Bank 75 Annual Report 2016

BOARD OF DIRECTORS

HARLEY T. SY, 57, Filipino, of Zenco Sales, Inc. from 1968 to 1975, and Director of
has been a Director of China Planters Development Bank from 2014 to 2015. Director
Bank since May 24, 2001. He Yao holds a Bachelor of Science degree in Business
is likewise the President of SM Administration minor in Accounting from the Mapua
Investments Corporation, the Institute of Technology. For his trainings, he recently
holding company of the SM attended ICD‘s Corporate Governance Training Program in
group and one of the largest 2016, and BSP-AMLC‘s seminar on AMLA in 2014.
publicly listed companies in the
Philippines. He also serves as Adviser to the Board of ROBERTO F. KUAN, 68,
Directors of BDO Private Bank. Mr. Sy holds a Bachelor Filipino, is an Independent
of Science degree in Commerce, Major in Finance from Director of the Bank. He was
De La Salle University. He has had extensive training first elected to the China Bank
on banking skills, including the Program on Enterprise Board on May 5, 2005. Aside
Risk Management in November 2008, AMLA Training in from China Bank, he is also an
August 2014 as well as Corporate Governance Training in Independent Director of Far
November 2016. Mr. Sy is a strong advocate of corporate Eastern University, Incorporated,
governance as he is actively involved in various initiatives a company listed in the PSE. Director Kuan also holds
aimed at further strengthening the corporate governance various directorship/trusteeship positions in companies
culture of the SM group. not listed in the PSE – among others, he is presently
member of the Boards of Trustees of St. Luke‘s Medical
ALBERTO S. YAO, 70, Filipino, Center, SLMC Global City, Inc., St. Luke‘s College of
is an Independent Director of Medicine – William H. Quasha Memorial, and Brent
the Bank. He was first elected International School, Inc.; independent director of
to the China Bank Board on July Seaoil Phils., Inc. and Towers Watson Insurance
7, 2004. He currently serves in Brokers Philippine Inc., and of Bank subsidiaries CBSI
companies not listed in the PSE and CBCC. He is the founder and former President of
– as President & CEO of Richwell Chowking Food Corporation, and former Chairman/
Trading Corporation, Richwell President of Lingnam Enterprises, Inc. Director Kuan
Philippines, Inc., Europlay Distributor Co., Inc., and is a graduate of the University of the Philippines with a
Internationale Globale Marques, Inc.; President of Richphil Bachelor of Science degree in Business Administration,
House Incorporated, and Megarich Property Ventures obtained his MBM from the AIM, and was conferred
Corp.; and as Independent Director of Bank Subsidiaries a Doctorate degree in Humanities Honoris Causa by
CBSI and CBCC. He was Vice President for Merchandising the Lyceum Northwestern University. He also attended

China Bank 76 Annual Report 2016

the Top Management Program conducted by the Southeast Asia, Corporate Governance Asia, Finance
AIM in Bali, Indonesia. Among the banking-related Asia and The Asset. Director Sio is a Certified
trainings he completed/attended were on Corporate Public Accountant and holds a Bachelor of Science
Governance in 2016, and on AMLA in 2015. degree in Commerce, major in Accounting, from the
University of San Agustin. He obtained his Master‘s
JOSE T. SIO, 77, Filipino, was degree in Business Administration from the New York
first elected as Bank Director University, U.S.A. He has completed various trainings
on November 7, 2007. He is here and abroad, including debt and equity financing
also presently affiliated with during the Euromoney Conference in China in 2005,
the following companies corporate governance seminars/workshops latest of
listed in the PSE: (1) SM which was conducted by SyCip Gorres Velayo & Co.
Investments Corporation, (SGV) in 2016, and anti-money laundering seminar
as Director, Executive Vice conducted by the BSP-AMLC in 2014.
President and CFO, Corporate Information Officer,
and member of the Executive Committee; (2) Atlas
Consolidated Mining and Development Corporation,
as Director and Member of the Executive Committee;
(3) Belle Corporation, as Director; (4) Concrete
Aggregates Corporation, as Director; (5) Premium
Leisure Corporation as Adviser to the Board; (6) SM
Prime Holdings, Inc. as Adviser of Audit Committee
/ Risk Oversight Committee; and (7) BDO Unibank,
Inc., as Adviser to the Board. Mr. Sio also serves as
Director in several companies not listed in the PSE,
including OCLP Holdings, Inc., Manila North Tollways
Corporation, and CityMall Commercial Centers Inc.
He is the President of SM Foundation, Inc. and
GlobalFund Holdings, Inc. Director Sio was formerly
a Senior Partner at SGV. He was voted as CFO of the
Year in 2009 by the Financial Executives of
the Philippines (FINEX). He was also awarded as
Best CFO (Philippines) in various years by Hong
Kong-based business publications such as Alpha

China Bank 77 Annual Report 2016

From left to right: Ananias S. Cornelio III, Jose L. Osmeña, Jr., Lilibeth R. Cariño, Virgilio O. Chua, Renato K. De Borja, Jr., Benedict L. Chan,
William C. Whang, Gilbert U. Dee, Ricardo R. Chua, Romeo D. Uyan Jr., Rosemarie C. Gan, Patrick D. Cheng, Alexander C. Escucha,
Delia Marquez, Alberto Emilio V. Ramos, and Ramon R. Zamora

MANAGEMENT GILBERT U. DEE, Director and Vice Chairman of the Board

COMMITTEE RICARDO R. CHUA, Director, President and CEO; Management Committee Chairman

WILLIAM C. WHANG, 58, Filipino, Executive Vice President, is the Bank‘s Chief
Operating Officer effective February 1, 2017. He is also the Head of Lending Business
Segment, and concurrent Head of Institutional Banking Group. He currently serves in the
Bank subsidiaries, as Director/Treasurer of China Bank Insurance Brokers, Inc. (CBC-IBI)
and CBC Properties and Computer Center, Inc. (CBC-PCCI), and Director of China Bank
Capital Corporation (CBCC) and China Bank Savings, Inc. (CBSI). He is also Director of
BancNet, Inc. He has more than 30 years of banking experience, formerly holding senior
management positions in Metrobank, Republic National Bank of New York, International
Exchange Bank, Security Bank, Sterling Bank of Asia, and other financial institutions.
He holds a Bachelor of Science degree in Commerce, Major in Business Management,
from the De La Salle University. Mr. Whang had attended numerous seminars and
conferences on corporate governance, branch based marketing, quality service
management, sales management, and corporate strategy.

ROMEO D. UYAN, JR., 54, Filipino, Executive Vice President, is Treasurer and Head
of Financial Markets Segment as well as concurrent President of CBCC. Mr. Uyan
was previously an investment banker with over two decades of experience in trading,
financing, and structuring in the Asia Pacific region with various foreign investment
houses. Most recently, he was Managing Director and Co-Head of Special Situations

China Bank 78 Annual Report 2016

and Leveraged Capital Markets at UBS AG-Singapore Branch. conducted by the Bank Administration Institute in 2012, and
Prior to this, he was Managing Director and Head of Asia Credit Corporate Governance workshops/seminars conducted by the
Products in Barclays Capital, where he was member of the Asia Institute of Corporate Directors (ICD) from 2014 to 2016.
Pacific Executive Committee as well as Global Emerging Markets
Committee. Mr. Uyan holds a Masters degree in Business ALBERTO EMILIO V. RAMOS, 57, Filipino, Executive Vice
Administration and graduated with distinction from the Johnson President of the Bank, is currently functioning as Director and
Graduate School of Management-Cornell University, New York. President of Bank subsidiary CBSI after his secondment in 2011.
He earned his Bachelor‘s degree from the Ateneo de Manila He also sits in the boards of Manulife China Bank Life Assurance
University, where he majored in Management Engineering and Corporation (MCBLife) and CBCC, and is Trustee/First Vice
graduated cum laude. President of the Chamber of Thrift Banks. Prior to joining the
Bank in 2006 as Head of Private Banking Group, Mr. Ramos was
ROSEMARIE C. GAN, 59, Filipino, Executive Vice President, President of Philam Asset Management, Inc., and also held key
is the Segment Head of the Bank’s Retail Banking Business. positions in local and international banks, including the Bank
She also serves as Director in the Bank subsidiary CBSI. of the Philippine Islands and Citytrust Banking Corporation.
Ms. Gan has been with the Bank for over 38 years, and had He graduated from the De La Salle University with a Bachelor
extensive exposure and training in marketing, financial analysis, of Arts degree in Political Science and Bachelor of Science in
credit portfolio management, strategic planning and corporate Commerce, Major in Marketing Management. He also holds a
governance. She graduated magna cum laude from the University Masters in Business Management (MBM) degree from the AIM
of Santo Tomas with a Bachelor of Science degree in Business and has a Treasury Professional Certificate from the Bankers
Administration, Major in Management, and was a recipient of the Association of the Philippines. He attended numerous training
distinguished Rector’s Award. She attended the Asian Institute of programs on SME Banking, corporate governance, treasury
Management‘s (AIM) Advanced Bank Management Program in products, asset-liability management, credit and financial
2013. She also participated in the BAI Retail Delivery Conference analysis, and strategic marketing planning.

China Bank 79 Annual Report 2016

MANAGEMENT COMMITTEE

PATRICK D. CHENG, 54, Filipino, Senior Vice President, is RAMON R. ZAMORA, 68, Filipino, is Senior Vice President
the Trust Officer of China Bank. He is also a Director of Manila and Head of the Bank’s centralized Operations Group,
Overseas Commercial Inc. and SR Holdings Corporation. Prior Remittance Business Operations, and Correspondent
to joining the Bank, Mr. Cheng held various senior management Banking. He is also a Director of Bank Subsidiaries
positions at the Philippine Bank of Communications, HSBC CBCPCCI, CBC Forex, and CBSI. Mr. Zamora had extensive
Savings Bank (Philippines), HSBC (Philippine Branch), Citicenter training on financial products, credit risk management,
Condominium Corp., and Citibank N.A. (Philippine Branch). IFRS, electronic banking, and corporate governance, among
He was previously the President and Chief Executive Officer of others. He was formerly a Vice President at Citibank N.A.
HSBC Savings Bank (Philippines) from 2008 to 2013 and was He holds a Bachelor of Arts degree in Economics from the
also a two-term President of the Chamber of Thrift Banks from Ateneo de Manila University.
2011 to 2012. He graduated from the University of the Philippines
with a Bachelor of Science degree in Business Administration RENATO K. DE BORJA, JR., 45, Filipino, First Vice
and Accountancy, magna cum laude. He also holds an MS President, is the Head of the Bank‘s Consumer Banking
Management degree, with Distinction, from the Hult International Business. He has more than 24 years of banking experience,
Business School in Cambridge, Massachusetts, and finished formerly holding positions as Director of East West Rural
the Trust Operations and Investment Management course, with Bank and Green Bank (a Rural Bank), Chief Finance Officer
Distinction, from the Trust Institute of the Philippines. He is a (CFO) of East West Banking Corporation, CFO of Citigroup
Certified Public Accountant, having placed 7th in the National Business Process Solutions and ROHQ, CFO of Metrobank
Exams. In 2010, he was a Distinguished Alumnus Awardee of Card Corporation, and various Finance and Accounting
the Virata School of Business (VSB) of the University of the roles in Standard Chartered Bank and Far East Bank &
Philippines – Diliman. He had extensive training on corporate Trust Co. He graduated with a Bachelor of Science degree
governance, anti-money laundering, asset liability management, in Commerce, Major in Accounting, from the University of
operational risk, and information security. Santo Tomas. He is a Certified Public Accountant (CPA),
BAP Certified Treasury Professional for money markets
ALEXANDER C. ESCUCHA, 60, Filipino, Senior Vice President, and foreign exchange, and a graduate of Global Executive
is the Head of the Bank's Investor and Corporate Relations MBA from the IE Business School. Mr. De Borja attended
Group. He is also a Director of Bank subsidiary CBSI, Chairman numerous trainings and seminars on corporate governance,
of the UP Visayas Foundation, Inc., and an international resource risk management, and other relevant banking subjects.
person at The Asian Banker. Mr. Escucha served as President of
the Philippine Economic Society (PES) and concurrent Chairman BENEDICT L. CHAN, 40, Filipino, First Vice President, is
of the Federation of ASEAN Economic Associations (FAEA), and the Trading and Sales Head of the Bank‘s Treasury Group.
President of the Corporate Planning Society of the Philippines, He has 20 years of experience on trading and portfolio
and Bank Marketing Association of the Philippines. Prior to management, having formerly held related positions at
joining China Bank, he was Vice President at International Trinitus Asset Management, BNP Paribas Singapore, BNP
Corporate Bank. He obtained his Bachelor of Arts degree in Paribas London, ING Bank Singapore, ING Bank Hongkong,
Economics, cum laude, from the University of the Philippines. and ING Bank Manila. Mr. Chan holds a Bachelor of Science
Over the years, he had attended various seminars here and degree in Management Engineering from the Ateneo de
abroad, the latest of which were as delegate and session chair Manila University. He is also a recipient of a Financial
at The Asian Banker Summit in 2015 and 2016, participant in the Markets Regulatory and Practice Certificate from the
corporate governance orientation conducted by the ICD in 2016, Singapore‘s Institute of Banking and Finance in 2013, and
and delegate in various conferences on economics, technology, has successfully passed the Hongkong Securities Paper
governance, and analytics. Exam 1 conducted by the HK FEC (Hongkong) in 2016.

China Bank 80 Annual Report 2016

VIRGILIO O. CHUA, 50, Filipino, First Vice President, is ANANIAS S. CORNELIO III, 41, Filipino, First Vice President,
currently seconded to Bank subsidiary CBCC functioning as its is the Bank's Chief Risk Officer. He has 20 years of banking
Managing Director, Treasurer and Head of Origination and experience, serving in risk, treasury or audit groups of
Client Coverage. He is also Board Director and Vice President, Development Bank of the Philippines, Rizal Commercial
Debt Capital Markets Committee, of the Investment House Banking Corp., First Metro Investment Corp., and Solidbank
Association of the Philippines since 2014, and currently Corporation prior to joining China Bank. He is a holder of a
serves as a board member of Philippine Dealing & Exchange Bachelor of Science degree in Commerce, with academic
Corporation, Philippine Depository & Trust Corporation, and distinction, from the San Beda College, and a Masters in Public
the Philippine Securities Settlement Corporation. He has more Administration, academic scholar, from the National University
than 25 years of experience in the fields of investment banking, of Singapore. He has also completed the Bank Management
corporate banking, and credit risk management, and held senior Course from the AIM, and JAVA Programming & DBMS from the
executive positions at Citibank N.A., First Metro Investment NIIT Computer School. Mr. Cornelio has had extensive trainings
Corp., and ING Bank, N.V. Mr. Chua holds a Management on corporate governance, macro prudential supervision and
Engineering degree from the Ateneo de Manila University and regulatory change, risk management, Basel Standards, fixed
has had extensive training on capital markets and investment income, credit derivatives and structured products, interest
banking, project finance, mergers and acquisitions, account rate and currency derivatives, ISDA documentation, and
management, financial markets, corporate risk assessment, economic forecasting, among others. He has been a panelist/
anti-money laundering and corporate governance. speaker in major events in the region which include The Asian
Banker Summit, ASEAN Risk Forum, Risk Minds Asia, and ADB
DELIA MARQUEZ, 55, Filipino, First Vice President II, is the Regional Forum on Financial Asset and Liability, and a resource
Head of the Bank’s Controllership Group and concurrent Head person/lecturer for the Bankers Institute of the Philippines
of Business Process Management Division. Prior to joining the (BAIPHIL), and the Association of Development Financing
Bank, she worked as Auditor at SGV & Co. and Transunion Institutions in Asia and the Pacific (ADFIAP).
Corporation. A Certified Public Accountant, Ms. Marquez
obtained her Bachelor of Science degree in Commerce, Major LILIBETH R. CARIÑO, 60, Filipino, First Vice President, is the
in Accounting, cum laude, from the University of Santo Tomas. Bank‘s Consumer Banking Group Head. She graduated from
To enhance her competence, she had attended tax summits the University of the Philippines with a degree in Bachelor
and various seminars on corporate governance, Internal of Science in Statistics, and took up Masters in Business
Capital Adequacy Assessment Process (ICAAP), risk model Administration (MBA) at the Ateneo Graduate School of
validation, Internal Credit Risk Rating System (ICRRS), and Business. She also attended the Asian Development Bank‘s
Basel, among others. seminar on institutional strengthening of financial institution,
and Allen Management Program‘s Professional Management
JOSE L. OSMEÑA, JR., 57, Filipino, First Vice President, is seminar/workshop. Ms. Cariño has been with the Bank for over
the Deputy Group Head of Retail Banking Business. He has 35 years, and had extensive exposure and training in corporate
been with the Bank for 25 years. Prior to joining China Bank, planning, treasury, credit, project finance, branch based
he worked at Insular Bank of Asia and America and Producers marketing, consumer banking, and real estate, among others.
Bank. Mr. Osmeña obtained his Bachelor of Science degree
in Commerce, Major in Accounting, and Masters of Science
in Business Administration, both from the University of San
Carlos. He also attended the AIM‘s Advance Bank Management
Program. His various trainings covered export financing, loan
documentation, and money market, among others.

China Bank 81 Annual Report 2016

MANAGEMENT DIRECTORY– CHINA BANK

Vice Chairman President & Chief Executive Officer Executive Vice Presidents Senior Vice Presidents
Gilbert U. Dee Ricardo R. Chua Rosemarie C. Gan Alexander C. Escucha
Alberto Emilio V. Ramos Patrick D. Cheng
Romeo D. Uyan Jr.
William C. Whang

First Vice Presidents Vice Presidents

Lilibeth R. Cariño Luis M. Afable, Jr. Marissa B. Espino Henry D. Sia
Benedict L. Chan Cristina P. Arceo Maria Luz B. Favis Clara C. Sy
Virgilio O. Chua Layne Y. Arpon Madelyn V. Fontanilla Wilfredo L. Sy
Ananias S. Cornelio III Betty L. Biunas Cesare’ Edwin M. Garcia Belenette C. Tan
Angela D. Cruz Richard S. Borja Cristina F. Gotuaco Stephen Y. Tan
Renato K. De Borja, Jr. Filemon Cecilio A. Cabungcal Jerry Ron T. Hao Manuel M. Te
Gerard Majella T. Dee Christopher Felix P. Chua Ma. Cristina C. Hernandez Marisol M. Teodoro
Delia Marquez Marie Carolina L. Chua Shirley C. Lee Maria Rosanna Catherina L. Testa
Victor O. Martinez Melissa F. Corpus Dorothy T. Maceda Geoffrey D. Uy
Jose L. Osmeña, Jr. Domingo P. Dayro, Jr. Mandrake P. Medina Noemi L. Uy
Elizabeth C. Say James Christian T. Dee Corazon I. Morando Virginia Y. Uy
Shirley G. K. T. Tan Norman D.C. Del Carmen Danilo T. Sarita Carina L. Yandoc
Lilian Yu Gemma B. Deladia Francisco Eduardo A. Sarmiento Marilyn G. Yuchenkang

Senior Assistant Vice Presidents

Emmanuel L. Abesamis Grace A. Cruz Juan Jesus C. Macapagal Roxana Angela S. Tan
Baldwin A. Aguilar Patricia J. Custodio Jennifer Y. Macariola Irene C. Tanlimco
Evelyn T. Alameda Ma. Jeanette D. Cuyco Ordon P. Maningding Ma. Cecilia V. Tejada
Ma. Hildelita P. Alano Ricardo J. De Guzman III Ronald R. Marcaida Ma. Edita Lynn Z. Trinidad
Juan Emmanuel B. Andaya Jinky T. Dela Torre Enrico J. Ong Josefina Anna D. Trinidad
Patrick Y. Ang Therese G. Escolin Juvy J. Pabustan Jasmin O. Ty
Rogelio B. Avellanosa Francisco Javier C. Galang Jocelyn T. Pavon Hudson Q. Uy
Love Virgilynn T. Baking Marlon B. Hernandez Frederick M. Pineda Esmeralda R. Vicente
Ma. Luisa O. Baylosis Grace Y. Ho Rafael Ramon C. Ramos Rosario D. Yabut
Victor Geronimo S. Calo Vivian T. Kho Ana Ma. Raquel Y. Samala Sandra Mae Y. Yao
Jonathan C. Camarillo Ma. Arlene Mae G. Lazaro Julie Ann P. Santiago George C. Yap
Victoria G. Capacio Eric Y. Lee Cynthia U. Surpia Michelle Y. Yap-Bersales
Camilo S. Cape Angelyn Claire C. Liao Jeanny C. Tan Hanz Irvin S. Yoro
Jeannette H. Chan Glenn B. Lotho Julieta C. Tan Mary Joy L. Yu

Assistant Vice Presidents

Ramiro A. Amanquiton Esperose S. De Claro Ma. Teresa O. Lao Charmaine V. Santos
Jay Angelo N. Anastacio Eliseo P. Doroteo Mary Ann L. Llanes Edgardo M. Santos
Edwin R. Aquino Mary Ann R. Ducanes Katherine N. Manguiat Fernando S. Santos III
Marissa A. Auditor Angelito T. Fernandez Gil P. Navelgas Ma. Graciela C. Santos
Faye Theresa S. Babasa Susan U. Ferrer Erlan Antonio B. Olavere Maria Sheila V. Sarmenta-Dayao
Cherrie Germaine T. Bautista Pablito P. Flores Remedios Emilia R. Olivar Ma. Cecilia D. So
Eric Von D. Baviera Ma. Salome D. Garcia Lilian B. Orlina Nelson L. Tiu
Jesus S. Belaniso III Marissa G. Garcia Sheilah B. Paglinawan Edna A. Torralba
Yasmin I. Biticon Dennis S. Go II Ma. Victoria G. Pantaleon Christopher C. Ty
Maria Charmina B. Bonifacio Virginia G. Go Josephine D. Paredes David Andrew P. Valdellon
Alex M. Campilan Ruth D. Holmes Noreen S. Purificacion Lauro C. Valera
Crisostomo L. Celaje Gladys Antonette P. Isidro Arnulfo H. Roldan Anthony Ariel C. Vilar
Victoria L. Chua Alex A. Jacob Eleanor D. Rosales
Ma. Rosalie F. Cipriano Maria Margaret U. Kua Anita Y. Samala
Maria Luisa C. Corpus Melecio C. Labalan, Jr. Alejandro F. Santos

China Bank 82 Annual Report 2016

MANAGEMENT DIRECTORY – SUBSIDIARIES

CHINA BANK SAVINGS

President First Vice Presidents I Vice Presidents Senior Assistant Vice Presidents
Alberto Emilio V. Ramos Adonis C. Yap James Christian T. Dee* Raymond C. Apo
Alternative Channels and Business Treasurer and Treasury Head Risk Officer and Risk Management
Senior Vice Presidents Process Management Group Division Head
Jose F. Acetre Head Anna Maria P. Ylagan
Assets Recovery Group Head Trust Officer Marivic B. Landicho
Neliza Ma. R. Oñate Internal Auditor
Maria Teresita R. Dean SME Lending Group Head/OIC Ma. Lilibeth C. Paradero
Credit and Collections Management Human Resources Division Group Ma. Joyce G. Zarate
Group Head Vice President II Marketing and Communications
Atty. Edgar D. Dumlao Lani J. Larion Division Head
First Vice Presidents II Corporate Secretary Branch Banking Group Head
Luis Bernardo A. Puhawan Assistant Vice President
Controller and Controllership Group Sonia B. Ostrea Emmanuel C. Geronimo Hanz Irvin S. Yoro*
Head Operations Group Head Planning and Accounting Services IT Security Officer
Head
Agerico G. Agustin Atty. Marissa B. Espino*
Branch Banking Group, Chief Compliance Officer Editha N. Young*
Sales and Marketing Chief Technology Officer * With interlocking position in
National Director China Bank

Jan Nikolai M. Lim

Consumer Lending Group Head

CHINA BANK CAPITAL MANULIFE CHINA BANK LIFE CHINA BANK INSURANCE CHINA BANK PROPERTIES AND
CORPORATION ASSURANCE CORPORATION BROKERS, INC. COMPUTER CENTER, INC.

President President and Chief Executive Officer President General Manager

Romeo D. Uyan, Jr. Robert D. Wyld Julieta P. Guanlao Phillip M. Tan

Managing Director & Chief Operating Vice President for Bancassurance Chief Technology Officer
Officer, Execution Head Regina Karla F. Libatique Editha N. Young
Ryan Martin L. Tapia
Vice President
Managing Director & Treasurer, Augusto P. Samonte
Coverage and Origination Head
Virgilio O. Chua Senior Assistant Vice Presidents
Joseph T. Yu
Directors: Benjamin SP Señires
Charles A. Gamo
Manuel C. San Diego Assistant Vice Presidents
Restituto B. Bayudan
Grace T. Chua Joseph Jeffrey B. Javier
Michael L. Chong Georgia Melissa F. Maog
Rhodin Evan O. Escolar Belinda P. Mendoza
Ariel A. Soner
Divine Grace F. Dagoy
Juan Paolo E. Colet

CHINA BANK SECURITIES

CORPORATION

President & Sales and Trading Director

Peter M. Mutuc

Research Director
Garie G. Ouano

Business Operations Director

Mary Antonette E. Quiring

China Bank 83 Annual Report 2016

FINANCIAL STATEMENTS CONTENT
86 Management's Discussion on Result of Operations and Financial Condition

87 Disclosure on Capital Structure and Capital Adequacy

95 Report of the Audit Committee

96 Certificate on the Compilation Services for the Preparation of the Financial Statements
and Notes to the Financial Statements

97 Statement of Management's Responsibility for Financial Statements

98 Independent Auditor's Report

101 Balance Sheets

102 Statements of Income

103 Statements of Comprehensive Income

104 Statements of Changes in Equity

106 Statements of Cash Flows

108 Notes to Financial Statements

MANAGEMENT’S DISCUSSION ON RESULT OF OPERATIONS
AND FINANCIAL CONDITION

RESULTS OF OPERATIONS

China Bank recorded a 15.32% improvement in net income to P6.46 billion for 2016, which translated to a 10.42% return on equity
and 1.16% return on assets.

Total operating income consisting of net interest income and fee-based income increased by 11.33% or P2.22 billion to
P21.79 billion with the growth in core businesses across all market segments. Total operating expenses (including provision for
impairment and credit losses) increased by 7.92% or P1.04 billion as the Bank continued to pursue its expansion strategy.

Net interest income improved by 10.67% to P16.69 billion from last year’s P15.09 billion, driven by the 12.51% rise in interest
revenues from loans. However, consolidated net interest margin was at 3.20% from the full-year impact of rising funding costs.

Total fee-based income increased by 13.54% to P5.09 billion from P4.49 billion last year boosted by trading gains, loan-related
service charges, trust fees and income from acquired assets. Trading and securities gain almost doubled to P918.09 million from
P466.83 million because of increased dealership business and gain on sale of available-for-sale securities. Trust fees grew by
P53.96 million to P330.20 million from the volume expansion of managed assets. Gain on sale of investment properties improved
by 17.98% to P443.32 million on the back of larger sales of foreclosed properties. However, this was offset by P102.50 million or
37.28% annual decline in gain on asset foreclosure and dacion transactions resulting from negative mark-to-market revaluation
on foreclosed assets. Service charges, fees and commissions registered a 15.76% improvement to P2.12 billion because of
significant contributions from the remittance business and higher loan-related charges. Miscellaneous income declined by 9.14% to
P878.45 million, mainly from lower dividend income. Share of total fee-based income to total revenues was at 18.88%.

The growth rate of operating expenses (excluding provision for impairment and credit losses) to P13.35 billion was controlled at
9.49% or P1.16 billion, improving the consolidated cost-to-income ratio to 61.27% from 62.30% last year. The material components
of operating expenses include compensation & fringe benefits which accounted for 37.32% of total operating expenses, taxes &
licenses at 14.98%, occupancy costs at 13.71%, and insurance at 8.71%. Provision for impairment and credit losses was recorded
at P850.55 million, P116.03 million or 12.00% lower from the significant reduction in past due loans.

The Bank’s sustained profitability contributed to its capital strength and enabled it to consistently pay dividends to stockholders. For
2016, China Bank paid cash dividends of P1.0 per share or a total of P1.85 billion, which represents a total payout of 33.06% of
prior years’ net income. The Bank also declared a 8% stock dividend or a total of P1.48 billion.

FINANCIAL CONDITION

The Bank’s total assets expanded by 20.19% to P633.20 billion from P526.83 billion mainly from the robust growth in investment
securities and loans supported by funding growth.

The Bank’s loan portfolio (net, inclusive of UDSCL) grew by 24.88% to P386.83 billion from P309.76 billion mainly from higher
demand across all customer segments (corporate, commercial and consumer). Consumer loans grew by 26.50% for 2016. The
Bank’s non-performing loans ratio improved to 1.86%, while loan loss coverage ratio was computed at 91.00%.

Total investment securities which consist of Financial Assets at Fair Value through Profit or Loss, Available-for-Sale and Held-to-
Maturity Financial Assets climbed to P98.98 billion from P71.21 billion, representing 15.63% of total assets, an improvement from
13.52% a year ago. Total liquidity ratio reached 34.39%.

On the liabilities side, total deposits increased by 23.29% to P541.58 billion from P439.27 billion mainly from the growth in customer
acquisition efforts and branch expansion. Total low-cost deposits (demand and savings) were P48.86 billion or 21.47% higher at
P276.42 billion and comprised 51.04% of total deposits. The Bank also issued the first tranche (P9.59 billion) of its Long-Term
Negotiable Certificates of Deposits (LTNCDs) in November, marking its return to the Peso debt market after the successful maiden
release of five-year, P5 billion LTNCDs in 2008. The LTNCDs are included under the time deposit liabilities account.

Total capital funds grew to P63.39 billion, 7.12% higher than last year’s P59.17 billion primarily from higher retained profits. The
Bank’s Common Equity Tier 1 (CET 1) and total CAR were computed at 11.30% and 12.21%, respectively.

China Bank 86 Annual Report 2016

DISCLOSURE ON CAPITAL STRUCTURE AND CAPITAL ADEQUACY

Capital Fundamentals

We believe that China Bank can only achieve sustainable growth by maintaining strong capital fundamentals. Major business
initiatives are undertaken with the appropriate capital planning which also takes into consideration constraints and changes in the
regulatory environment. This is necessary to ensure that the Bank’s commercial objectives are equally aligned with its ability to
maintain a capital position at par with the industry. The Board and Senior Management recognize that a balance should be achieved
with respect to China Bank’s earnings outlook vis-à-vis capital fundamentals that can take advantage of growth opportunities while
maintaining sufficient capacity to absorb shocks.

Risk-based capital components, including deductions, on a parent and consolidated basis:

Qualifying Capital (Basel III) Consolidated Parent Company

In PhP Million 2016
Common Equity Tier 1 Capital
Paid-up common stock 20,020.28 20,020.28
Additional paid-in capital 6,987.56 6,987.56
Retained Earnings 32,341.53 31,617.74
Other Comprehensive Income (1,279.51) (1,216.81)
Minority Interest 100.32 -
Less: Unsecured DOSRI (440.48) (419.43)
Less: Deferred Tax Assets (2,165.10) (2,165.10)
Less: Goodwill (563.47) (222.84)
Less: Other Intangible Assets (3,065.71) (442.12)
Less: Defined Benefit Pension Fund Assets/Liabilities (682.43) (682.43)
Less: Investment in Subsidiaries (370.55) (9,189.25)
Less: Significant Minority Investment (26.92) (26.92)
Less: Other Equity Investment (23.10) (20.91)
Total CET 1 Capital 50,832.42 44,239.76
Additional Tier 1 Capital - -
Total Tier 1 Capital 50,832.42 44,239.76
Tier 2 Capital
General Loan Loss Provision 4,076.47 3,513.93
Total Tier 2 Capital 4,076.47 3,513.93
Total Qualifying Capital 54,908.89 47,753.69

Qualifying Capital (Basel III) Consolidated Parent Company

In PhP Million 2015
Common Equity Tier 1 Capital
Paid-up common stock 18,537.29 18,537.29
Additional paid-in capital 6,987.56 6,987.56
Retained Earnings 29,370.35 29,399.17
Other Comprehensive Income (857.79) (787.78)
Minority Interest 34.01 -
Less: Unsecured DOSRI (422.94) (420.69)
Less: Deferred Tax Assets (2,128.35) (2,128.35)
Less: Goodwill (567.25) (222.84)
Less: Other Intangible Assets (2,439.68) (442.12)
Less: Defined Benefit Pension Fund Assets/Liabilities (771.49) (771.49)
Less: Investment in Subsidiaries (291.24) (7,084.02)
Less: Significant Minority Investment (44.91) (44.91)
Less: Other Equity Investment (12.20) (10.01)
Forward

China Bank 87 Annual Report 2016

DISCLOSURE ON CAPITAL STRUCTURE AND CAPITAL ADEQUACY

Qualifying Capital (Basel III) Consolidated Parent Company

In PhP Million 2015
Total CET 1 Capital 47,393.36 43,011.81
Additional Tier 1 Capital - -
Total Tier 1 Capital 47,393.36 43,011.81
Tier 2 Capital
General Loan Loss Provision 3,486.40 2,954.86
Total Tier 2 Capital 3,486.40 2,954.86
Total Qualifying Capital 50,879.76 45,966.67

Risk-based capital ratios:

Basel III Consolidated Parent Company
2016
In PhP Million
CET 1 capital 58,170.18 57,408.77
Less regulatory adjustments 7,337.76 13,169.02
Total CET 1 capital 50,832.42 44,239.76
Additional Tier 1 capital - -
Total Tier 1 capital 50,832.42 44,239.76
Tier 2 capital 4,076.47 3,513.93
Total qualifying capital 54,908.89 47,753.69
Risk-weighted assets 449,683.04 382,679.13
CET 1 capital ratio 11.30% 11.56%
Tier 1 capital ratio 11.30% 11.56%
Total capital ratio 12.21% 12.48%

Basel III Consolidated Parent Company

2015
In PhP Million
CET 1 capital 54,071.41 54,136.24
Less regulatory adjustments 6,678.05 11,124.43
Total CET 1 capital 47,393.36 43,011.81
Additional Tier 1 capital - -
Total Tier 1 capital 47,393.36 43,011.81
Tier 2 capital 3,486.40 2,954.86
Total qualifying capital 50,879.76 45,966.67
Risk-weighted assets 376,825.22 319,859.48
CET 1 capital ratio 12.58% 13.45%
Tier 1 capital ratio 12.58% 13.45%
Total capital ratio 13.50% 14.37%

The regulatory Basel III qualifying capital of the Group consists of Common Equity Tier 1 capital (going concern capital), which
comprises paid-up common stock, additional paid-in capital, surplus including current year profit, other comprehensive income
and minority interest less required deductions such as unsecured credit accommodations to DOSRI, deferred income tax, other
intangible assets, goodwill, defined benefit pension fund assets/liabilities, and investment in subsidiaries. The other component of
regulatory capital is Tier 2 capital (gone-concern capital), which includes general loan loss provision. A capital conservation buffer of
2.5% comprised of CET 1 capital is likewise imposed in the Basel III capital ratios.

China Bank 88 Annual Report 2016

Full reconciliation of all regulatory capital elements back to the balance sheet in the audited financial statements is presented below:

Parent
2016 2015
Audited Audited
Qualifying Reconciling Financial Qualifying Reconciling Financial
In PhP Million Capital Items Statements Capital Items Statements
Common stock 20,020 - 20,020 18,537 - 18,537
Additional paid-in capital 6,988 - 6,988 6,988 - 6,988
Retained earnings 32,342 (5,409) 37,751 29,370 (5,259) 34,629
Net unrealized gains or losses on AFS securities (1,313) 286 (1,599) (1,033) 93 (1,126)
Cumulative foreign currency translation and others 33 (198) 231 175 27 149
Non-controlling interest 100 106 (5) 34 40 (6)
Deductions (7,338) (7,338) - (6,678) (6,678) -
Tier 1 (CET1) capital/Total equity 50,832 (12,554) 63,386 47,393 (11,778) 59,171
Tier 2 capital 4,076 4,076 - 3,486 3,486 -
Total qualifying capital/Total equity 54,909 (8,477) 63,386 50,880 (8,291) 59,171

Parent
2016 2015
Audited Audited
Qualifying Reconciling Financial Qualifying Reconciling Financial
In PhP Million Capital Items Statements Capital Items Statements
Common stock 20,020 - 20,020 18,537 - 18,537
Additional paid-in capital 6,988 - 6,988 6,988 - 6,988
Retained earnings 31,618 (6,133) 37,751 29,370 (5,230) 34,629
Net unrealized gains or losses on AFS securities (1,313) 286 (1,599) (1,033) 93 (1,126)
Cumulative foreign currency translation and others 96 (135) 231 245 96 149
Deductions (13,169) (13,169) - (11,124) (11,124) -
Tier 1 (CET1) capital/Total equity 44,240 (19,152) 63,391 43,012 (16,165) 59,176
Tier 2 capital 3,514 3,514 - 2,955 2,955 -
Total qualifying capital/Total equity 47,754 (15,638) 63,391 45,967 (13,210) 59,176

The capital requirements for Credit, Market and Operational Risk are listed below, on a parent and consolidated basis:

Capital Requirement Consolidated Parent

in PhP Million 2016 2015 2016 2015
Credit Risk 41,438.12 34,814.92 35,265.13 29,488.30
Market Risk 457.53 276.95 433.90 227.36
Operational Risk 3,072.65 2,590.65 2,568.88 2,270.29
Total Capital Requirements 44,968.30 37,682.52 38,267.91 31,985.95

China Bank 89 Annual Report 2016

DISCLOSURE ON CAPITAL STRUCTURE AND CAPITAL ADEQUACY

Credit Risk

On-balance sheet exposures, net of specific provisions and not covered by Credit Risk Mitigants (CRM) (in PhP million):

December 2016

Consolidated Parent
On-Balance Sheet Assets Exposures, Exposures,
Exposures not Exposures not
net of Specific net of Specific
Covered by CRM Covered by CRM
Provisions Provisions
Cash on Hand 11,817.72 11,817.72 10,502.02 10,502.02
Checks and Other Cash Items 172.22 172.22 152.44 152.44
Due from BSP 91,791.03 91,791.03 85,133.66 85,133.66
Due from Other Banks 10,013.41 10,013.41 8,370.13 8,370.13
Financial Assets at FVPL 2,472.60 2,462.89 2,472.60 2,462.89
Available-for-Sale Financial Assets 33,937.65 32,966.67 31,374.20 30,403.22
Held-to-Maturity Financial Assets 58,131.81 58,131.81 54,755.05 54,755.05
Unquoted Debt Securities Classified as
Loans 4,106.19 4,106.19 4,000.98 4,000.98
Loans and Receivables 387,185.32 362,850.92 330,301.95 311,073.96
Loans and Receivables arising from
Repurchase Agreements 3,452.13 3,452.13 2,959.06 2,959.06
Sales Contract Receivables 909.20 909.20 228.43 228.43
Real and Other Properties Acquired 4,298.03 4,298.03 605.71 605.71
Other Assets 10,518.86 10,518.86 6,890.90 6,890.90
Total On-Balance Sheet Assets 618,806.17 593,491.08 537,747.14 517,538.46

December 2015

Consolidated Parent
On-Balance Sheet Assets Exposures, Exposures,
Exposures not Exposures not
net of Specific net of Specific
Covered by CRM Covered by CRM
Provisions Provisions
Cash on Hand 11,315.70 11,315.70 9,997.94 9,997.94
Checks and Other Cash Items 128.93 128.93 125.72 125.72
Due from BSP 86,107.22 86,107.22 76,791.60 76,791.60
Due from Other Banks 20,727.94 20,727.94 18,721.97 18,721.97
Financial Assets at FVPL 2,309.16 2,299.97 2,309.16 2,299.97
Available-for-Sale Financial Assets 49,212.27 48,293.27 47,349.01 46,430.01
Held-to-Maturity Financial Assets 16,449.17 16,449.17 14,228.65 14,228.65
Unquoted Debt Securities Classified as
Loans 1,291.55 1,291.55 1,021.55 1,021.55
Loans and Receivables 312,709.73 296,968.77 262,396.76 251,552.50
Loans and Receivables arising from
Repurchase Agreements 0.00 0.00 0.00 0.00
Sales Contract Receivables 977.75 977.75 251.54 251.54
Real and Other Properties Acquired 3,415.27 3,415.27 721.69 721.69
Other Assets 11,525.08 11,525.08 8,665.47 8,665.47
Total On-Balance Sheet Assets 516,169.78 499,500.62 442,581.07 430,808.62

China Bank 90 Annual Report 2016

Credit equivalent amount for off-balance sheet items, broken down by type of exposures (in PhP million):

2016 2015
Consolidated Parent Consolidated Parent
Off-balance Sheet Assets
Notional Credit Notional Credit Notional Credit Notional Credit
Principal Equivalent Principal Equivalent Principal Equivalent Principal Equivalent
Direct Credit Substitutes 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Transaction-related
contingencies 17,129.58 8,564.79 16,795.09 8,397.55 18,642.19 9,321.10 18,312.08 9,156.04
Trade-related contingencies
arising from movement
of goods 5,211.89 1,042.38 5,174.63 1,034.93 8,780.79 1,756.16 4,168.27 833.65
Other commitments (which
can be unconditionally
cancelled at any time by
the bank without prior
notice) 149,582.52 0.00 144,594.20 0.00 134,164.24 0.00 130,113.85 0.00
Total Notional Principal
and Credit Equivalent
Amount 171,923.98 9,607.17 166,563.93 9,432.47 161,587.23 11,077.26 152,594.21 9,989.70

Credit equivalent amount for counterparty credit risk in the trading book, broken down by type of exposures (in PhP million):

December 2016

Consolidated Parent
Standardized Approach
Notional Principal Credit Equivalent Notional Principal Credit Equivalent
Interest Rate Contracts 10,823.40 72.93 10,823.40 72.93
Exchange Rate Contracts 16,830.93 343.13 16,830.93 343.13
Equity Contracts 0.00 0.00 0.00 0.00
Credit Derivatives 0.00 0.00 0.00 0.00
Total Notional Principal and
Credit Equivalent Amount 27,654.33 416.07 27,654.33 416.07

December 2015

Consolidated Parent
Standardized Approach
Notional Principal Credit Equivalent Notional Principal Credit Equivalent
Interest Rate Contracts 6,950.00 31.62 6,950.00 31.62
Exchange Rate Contracts 29,022.60 551.18 29,022.60 551.18
Equity Contracts 0.00 0.00 0.00 0.00
Credit Derivatives 0.00 0.00 0.00 0.00
Total Notional Principal and
35,972.60 582.80 35,972.60 582.80
Credit Equivalent Amount

Net Exposures after CRM for counterparty credit risk in the banking book, broken down by type of exposures (in PhP million):

December 2016

Consolidated Parent
Standardized Approach Fair Value/ Carrying Net Exposures after Fair Value/ Carrying Net Exposures after
Amount CRM Amount CRM
Derivative Transactions 0.00 0.00 0.00 0.00
Repo-Style Transactions 9,520.22 1,447.43 9,520.22 1,447.43
Total Fair Value/Carrying Amount and
9,520.22 1,447.43 9,520.22 1,447.43
Net Exposures after CRM

China Bank 91 Annual Report 2016

DISCLOSURE ON CAPITAL STRUCTURE AND CAPITAL ADEQUACY

December 2015

Consolidated Parent
Standardized Approach Fair Value/ Carrying Net Exposures after Fair Value/ Carrying Net Exposures after
Amount CRM Amount CRM
Derivative Transactions 0.00 0.00 0.00 0.00
Repo-Style Transactions 13,020.27 1,967.19 13,020.27 1,967.19
Total Fair Value/Carrying Amount and
Net Exposures after CRM 13,020.27 1,967.19 13,020.27 1,967.19

The following credit risk mitigants are used in the December 2016 CAR Report:

• ROP warrants
• ROP guarantees
• HGC guarantee
• Holdout vs. Peso deposit / Deposit substitute
• Holdout vs. FCDU deposit of resident
• Holdout vs. FCDU deposit of non-resident
• Assignment / Pledge of Government Securities

Total credit exposure after risk mitigation, broken down by type of exposures, risk buckets, as well as those that are deducted from
capital (in PhP million):

Weight 2016
Band Consolidated Parent Company
On-balance Off-balance On-balance Off-balance
Counterparty Total Counterparty Total
sheet sheet sheet sheet
Below 100% 252,534.01 21.86 1,805.97 254,361.84 224,540.77 21.86 1,805.97 226,368.61
100% and
Above 340,957.07 9,585.31 57.53 350,599.91 292,997.69 9,410.61 57.53 302,465.83
Total 593,491.08 9,607.17 1,863.50 604,961.75 517,538.46 9,432.47 1,863.50 528,834.43

Weight 2015
Band Consolidated Parent Company
On-balance Off-balance On-balance Off-balance
Counterparty Total Counterparty Total
sheet sheet sheet sheet
Below 100% 220,502.35 966.22 2,369.43 223,838.01 193,175.37 43.72 2,369.43 195,588.52
100% and
Above 278,998.27 10,111.03 180.55 289,289.86 237,633.25 9,945.98 180.55 247,759.78
Total 499,500.62 11,077.26 2,549.99 513,127.87 430,808.62 9,989.70 2,549.99 443,348.31

Total credit risk-weighted assets, broken down by type of exposures (in PhP million):

2016
Weight Consolidated Parent Company
Band On-balance Off-balance On-balance Off-balance
Counterparty Total Counterparty Total
sheet sheet sheet sheet
Below 100% 58,436.20 4.37 542.12 58,982.70 48,001.61 4.37 542.12 48,548.10
100% and
345,656.04 9,585.31 57.53 355,298.88 294,570.61 9,410.61 57.53 304,038.75
Above
Covered by
99.63 0.00 0.00 99.63 64.40 0.00 0.00 64.40
CRM
Excess
0.00 0.00
GLLP
Total 404,191.88 9,589.68 599.65 414,381.20 342,636.62 9,414.98 599.65 352,651.25

China Bank 92 Annual Report 2016

 2015

Weight Consolidated Parent Company

Band
On-balance Off-balance On-balance Off-balance
Counterparty Total Counterparty Total
sheet sheet sheet sheet
Below 100% 54,350.83 8.74 900.65 55,260.22 45,237.43 8.74 900.65 46,146.81
100% and
Above 283,011.77 10,111.03 180.55 293,303.36 239,142.00 9,945.98 180.55 249,268.53
Covered by
CRM 76.21 0.00 0.00 76.21 71.18 0.00 0.00 71.18
Excess
GLLP (490.54) (603.52)
Total 337,438.81 10,119.78 1,081.20 348,149.25 284,450.60 9,954.72 1,081.20 294,883.00

The credit ratings given by the following rating agencies were used to determine the credit risk weight of On-balance sheet,
Off-balance sheet, and Counterparty exposures:

For all rated credit exposures regardless of currency

Standard & Poor (S&P)
Moody’s
Fitch

For PhP-denominated debts of rated domestic entities

PhilRatings

Market Risk-Weighted Assets

The Standardized Approach is used in China Bank’s market risk-weighted assets. The total market risk-weighted asset of the Bank
as of December 2016 is P4.34 billion and P4.58 billion for parent company and consolidated basis, respectively. This is composed
of Interest Rate exposures amounting to P2.10 billion and Foreign Exposures amounting to P2.24 billion for the parent bank, while
it is composed of Interest Rate exposures amounting to P2.32 billion and Foreign Exposures amounting to P2.25 billion on a
consolidated basis.

Consolidated Parent Company Consolidated Parent Company

Interest Rate Exposures (in PhP Mn) 2016 2015
Specific Risk 63.53 60.92 42.80 36.50
General Market Risk
PHP 41.59 34.99 49.18 37.78
USD 80.66 72.35 56.51 38.15
Total Capital Charge 185.78 168.26 148.49 112.43
Adjusted Capital Charge 232.23 210.33 185.61 140.53
Subtotal Market Risk-Weighted Assets 2,322.27 2,103.25 1,856.11 1,405.33

China Bank 93 Annual Report 2016

DISCLOSURE ON CAPITAL STRUCTURE AND CAPITAL ADEQUACY

Consolidated Parent Company Consolidated Parent Company

Foreign Exchange Exposures 2016 2015
Total Capital Charge 180.24 178.86 73.07 69.46
Adjusted Capital Charge 225.30 223.58 91.34 86.83
Subtotal Market Risk-Weighted Assets 2,253.05 2,235.80 913.40 868.27

Total Market Risk-Weighted Assets 4,575.31 4,339.05 2,769.51 2,273.60

Operational risk

Operational risks arise from inadequate or failed internal processes, people and systems or from external events. The Bank employs
several tools to identify, assess, monitor and control the operational risk inherent to the Bank.

Tools such as the Risks and Controls Self-Assessment (RCSA), the analysis of historical loss reports, the monitoring of Key Risk
Indicators (KRI) and the Business Impact Analysis further allow risk management to identify high risk areas, loss drivers, and trends
which can be acted upon by management to prevent material failures in our processes, people, systems, and resiliency measures
against external events. These results are periodically reported to management and cover all aspects of the business from core
operating capabilities of the units, all products and services, outstanding legal cases, and even its sales and marketing practices.
In addition, the Bank has a product review and approval process. It seeks to outline a standard approach involved in implementing
the product management mandate for all product categories in the Bank and will ultimately reflect the Bank’s operating and risk
management philosophy in the context of its over-all business goals and strategies.

The operational risk exposure of the Bank is profiled using a number of methodologies which also include a scenario analysis
exercise as part of the Internal Capital Adequacy Assessment Process (ICAAP) to validate if the computed capital requirement
using the Basic Indicator Approach (BIA) is enough to cover estimated losses arising from adverse operating conditions and major
incidents. The Bank allocated the amount of P3.07 billion in capital as of December 2016 for operational risk which is more than
adequate to cover the resulting exposure based on the scenario analysis exercise.

Internal measurement of interest rate risk in the banking book

The Bank’s Interest Rate Risk (IRR) originates from its holdings of interest rate sensitive assets and interest rate sensitive liabilities.
Internally, the Earnings-at-Risk (EaR) method is used to determine the effects of adverse interest rate change on the Bank’s interest
earnings. The Bank’s earnings from loans are assumed affected by interest rate movements on the repricing period in the case
of floating rates while earnings remain constant until maturity on loans set with fixed rates. Demand and savings deposits, on the
other hand, are generally not interest rate sensitive. Provided in the table below are the approximate reduction in annualized interest
income of a 100bps adverse change across the PhP and USD yield curves.

Consolidated Parent
Earnings-at-Risk in PhP Million
2016 2015 2016 2015
PHP IRR Exposures (237) (577) (387) (664)
USD IRR Exposures (183) (55) (169) (47)

China Bank 94 Annual Report 2016

REPORT OF THE AUDIT COMMITTEE

The Audit Committee is responsible for assisting the Board of Directors in overseeing all matters pertaining to audit, primarily in
monitoring and reviewing the Bank’s internal control framework, financial reporting, and internal and external audit. The Committee
operates under a charter identifying its purpose, objective, authority and membership, setting the voting and quorum requirements
as well as meetings and access, enumerating the duties and responsibilities, and providing for self-assessment and charter review.
The full terms of reference are available on the Bank’s corporate governance website, www.chinabank.ph.

Independent director Alberto S. Yao chairs the Audit Committee, assisted by non-executive director Joaquin T. Dee as member.
Another independent director – Mr. Dy Tiong – served as member of the Audit Committee until his passing on September 16, 2016.

In accordance with the charter, relevant laws and regulations, and international standards, we confirm that the Audit Committee met
12 times in 2016 and conducted various activities set out below:

§ Reviewed the effectiveness of internal audit function and the Chief Audit Executive, including their accomplishments versus
plans and budget.

§ Confirmed the adherence by the internal auditors to the Institute of Internal Auditors’ International Standards for the Professional
Practice of Internal Auditing (IIA-ISPPIA), such as Standard 1100 on independence and objectivity, and Standard 2130 and
Practice Advisory 2130-1 on control and assessment of the adequacy of control processes; and amended the internal auditors’
Audit Manual in order to improve the value of audit in terms of the prioritization of units and processes to be audited, and to
conform with IIA-ISPPIA’s Standard 2010-1 on linking the audit plan to risk and exposures.

§ Considered the regular and special internal audit reports on and replies of various branches and units of the Bank; reviewed
IT-related and other audit projects of the Bank; discussed the summary of common observations and changes in audit ratings
of reviewed units; took note of updates on operations and behavioral cases; tackled whistleblowing disclosures; and monitored
on a quarterly basis the status of outstanding audit issues including the remedial actions being taken.

§ Reviewed the qualifications, performance, competence and independence of the external auditor, recommended to the Board
the re-engagement/re-appointment of Sycip Gorres Velayo & Co. (SGV & Co.) / Ernst & Young as the Bank’s external auditor,
and approved their fees.

§ Discussed the external auditor’s annual audit plan, reviewed the results of audit of the consolidated financial statements of the
Bank and subsidiaries, and endorsed the approval of the audited financial statements and their inclusion in the Annual Report
for the year ended December 31, 2016, after determining that they present fairly, in all material respects, the financial position
of the Group and of the parent bank.

§ Discussed with the internal and external auditors the new issuances by the Financial Reporting Standards Council, Bureau of
Internal Revenue, Securities and Exchange Commission (SEC), and/or Bangko Sentral ng Pilipinas (BSP), and their significance
to the operations of the Bank.

§ In the exercise of its full discretion, invited officers of the Bank, external auditors, and other guests to attend meetings of the
Committee, without the presence of management, to enable the Committee to effectively discharge its functions by obtaining
feedback, independently evaluating the issues, and arriving at resolutions and recommendations.

Based on the foregoing, it is the Audit Committee’s view that the internal control and financial reporting systems of the Bank are in
place, adequate, effective and efficient.

Makati City, March 15, 2017.

ALBERTO S. YAO JOAQUIN T. DEE (vacant)

Chairman Member Member

China Bank 95 Annual Report 2016

CERTIFICATE ON THE COMPILATION SERVICES FOR THE PREPARATION OF THE
FINANCIAL STATEMENTS AND NOTES TO THE FINANCIAL STATEMENTS
I hereby certify that I am the Certified Public Accountant who performed the compilation services related to the preparation and
presentation of financial information of an entity in accordance with an applicable financial reporting framework and reports required
by accounting and auditing standards for China Banking Corporation for the period ended December 31, 2016.

In discharging this responsibility, I hereby declare that I am an officer under Controllership Group of China Banking Corporation.

Furthermore, in the compilation services for preparation of the Financial Statements and Notes to the Financial Statements, I was not
assisted by or did not avail of the services of Sycip Gorres Velayo & Co., who is the external auditor who rendered the audit opinion
for the said Financial Statement and Notes to the Financial Statements.

I hereby declare, under penalties of perjury and violation of the Revised Accountancy Law, that my statements are true and correct.

Edgar S. Neri Jr.

CPA Certificate No. 122893
Valid until September 14, 2019
CPA Accreditation filed on December 9, 2016 and is pending at the PRC

March 1, 2017

NOTARY PUBLIC

Doc. No. 298

Page No. 60
Book No. 44
Series of 2017

China Bank 96 Annual Report 2016

STATEMENT OF MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL STATEMENTS

The management of China Banking Corporation (the Bank) is responsible for the preparation and fair presentation of the consolidated
financial statements including the schedules attached therein, for the years ended December 31, 2016 and 2015, in accordance with
the prescribed financial reporting framework indicated therein, and for such internal control as management determines is necessary
to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Bank’s ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless
management either intends to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.

The Board of Directors is responsible for overseeing the Bank’s financial reporting process.

The Board of Directors reviews and approves the consolidated financial statements including the schedules attached therein, and
submits the same to the stockholders.

SyCip Gorres Velayo & Co., the independent auditors appointed by the stockholders, has audited the consolidated financial
statements of the Bank in accordance with Philippine Standards on Auditing, and in its report to the stockholders, has expressed its
opinion on the fairness of presentation upon completion of such audit.

Hans T. Sy Ricardo R. Chua Delia Marquez

Chairman of the Board President & CEO First Vice President-Controller

} S. S.
Republic of the Philippines
City of Makati

Signed this 1st day of March 2017, affiants exhibiting to me their Social Security System Nos. as follows:

Name SSS Nos.

Hans T. Sy 03-43011743
Ricardo R. Chua 03-24163898
Delia Marquez 03-7205726-0

Doc. No.: 300

Page No.: 60
Book No.: 44
Series of: 2017

China Bank 97 Annual Report 2016

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Stockholders

China Banking Corporation
8745 Paseo de Roxas cor. Villar St.
Makati City

Report on the Consolidated and Parent Company Financial Statements

Opinion

We have audited the consolidated financial statements of China Banking Corporation and its subsidiaries (the Group) and the parent company
financial statements of China Banking Corporation, which comprise the consolidated and parent company balance sheets as of December 31, 2016
and 2015, and the consolidated and parent company statements of income, consolidated and parent company statements of comprehensive
income, consolidated and parent company statements of changes in equity and consolidated and parent company statements of cash flows
for each of the three years in the period ended December 31, 2016, and notes to the consolidated and parent company financial statements,
including a summary of significant accounting policies.

In our opinion, the accompanying consolidated and parent company financial statements present fairly, in all material respects, the financial
position of the Group and the Parent Company as of December 31, 2016 and 2015, and their financial performance and their cash flows for each
of the three years in the period ended December 31, 2016 in accordance with Philippine Financial Reporting Standards (PFRSs).

Basis for Opinion

We conducted our audits in accordance with Philippine Standards on Auditing (PSAs). Our responsibilities under those standards are further
described in the Auditor’s Responsibilities for the Audit of the Consolidated and Parent Company Financial Statements section of our report. We
are independent of the Group and the Parent Company in accordance with the Code of Ethics for Professional Accountants in the Philippines
(Code of Ethics) together with the ethical requirements that are relevant to our audit of the consolidated and parent company financial statements
in the Philippines, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe
that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated and parent
company financial statements of the current period. These matters were addressed in the context of our audit of the consolidated and parent
company financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For
each matter below, our description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the Consolidated and Parent Company Financial
Statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed
to respond to our assessment of the risks of material misstatement of the consolidated and parent company financial statements. The results
of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying consolidated and parent company financial statements.

Applicable to the audit of the Consolidated and Parent Company Financial Statements

Adequacy of allowance for credit losses on loans and receivables

Loans and receivables comprise 61.09% and 58.86% of the total assets of the Group and the Parent Company as of December 31, 2016,
respectively. Reflecting these assets and the related allowance for credit losses at their appropriate amounts is a key area of judgment for the
management. The Group determines the allowance for credit losses on an individual basis for individually significant loans and receivables. In
contrast, allowance for credit losses on loans and receivables that are not individually significant or are not specifically impaired are collectively
determined. The identification of impairment and the determination of the recoverable amount are inherently uncertain processes involving various
factors such as the financial condition of the borrower, the borrower’s payment behavior and expectation of amounts and timing of collections or
liquidation of collateral. The use of assumptions could produce significantly different estimates of allowance for credit losses. The disclosures in
relation to allowance for credit and impairment losses are included in Notes 3, 5 and 15 of the financial statements.

Audit Response

We obtained an understanding of the Group’s credit monitoring and impairment process and tested the relevant key controls for these processes,
including the underlying data and systems. For allowance for credit losses calculated on an individual basis, we obtained sample loan accounts
and tested the assumptions underlying the impairment identification following the Group’s internal risk rating and accounts’ age. We also tested
the allowance quantification by comparing forecasts of future cash flows with the accounts’ historical collection, including any collections after
yearend, repayment agreements and availability of collateral. For impaired accounts expecting recovery through foreclosure of collateral, we
checked mortgage documents and tested for any other outstanding encumbrances, and agreed values of collaterals used to the appraisal reports
and historical sales. We also checked the discount rates used if they are based on the loans’ original effective interest rate (EIR) for fixed-rate loans,
and the current EIR adjusted for the original credit risk premium for floating-rate loans, and re-performed impairment calculation.

China Bank 98 Annual Report 2016

For allowance for credit losses calculated on a collective basis, we tested the underlying impairment model and related inputs (e.g., historical
loss rates). We performed said testing by checking credit risk groupings and agreeing model inputs to subsidiary ledgers, reports on aging and
historical recoveries on fully impaired accounts.

Recoverability of Goodwill

Under PFRS, the Group and the Parent Company are required to annually test the amount of goodwill for impairment. Goodwill recognized in
the consolidated and parent company financial statements amounting to P222.84 million is attributed to the Parent Company’s Retail Banking
Business (RBB) segment, while goodwill of P616.91 million in the consolidated financial statements is attributed to the subsidiary bank, China
Bank Savings, Inc. (CBSI). The annual impairment test, which is performed by determining the recoverable amounts of the cash generating units
(CGUs) based on value-in-use (VIU) calculation, is significant to our audit because the management’s assessment process requires significant
judgment and is based on assumptions. The assumptions used in the calculation are sensitive to estimates of future cash flows from the relevant
CGUs, growth rates used to project future cash flows beyond the budget period and the discount rates. The disclosures in relation to goodwill are
included in Notes 3 and 13 of the financial statements.

Audit Response

We obtained an understanding of the Group’s impairment process and related controls. We evaluated the financial forecast used by the
management for the VIU calculation by comparing key assumptions used in the financial forecast. This includes comparing the loan and deposit
growth rates against the historical performance of the CGUs, banking industry outlook, and other relevant external data. We also involved our
internal specialist in assessing the methodology and other key assumptions used by the Group in the VIU calculation ‒ particularly those relating
to growth rates used to project future cash flows beyond the forecast period and testing the parameters used to derive discount rates. We also
checked the Group’s disclosures with regard to assumptions to which the outcome of the impairment test is most sensitive, that is, those that
have the most significant effect on the determination of the recoverable amount of goodwill.

Realizability of deferred tax assets

As disclosed in Notes 3 and 26 of the financial statements, as of December 31, 2016, the Parent Company has recognized deferred tax assets
on all temporary differences, while the Group has recognized and unrecognized deferred tax assets. The realizability of deferred tax assets
recognized depends on the Group’s ability to continuously generate sufficient future taxable income. The realizability of deferred tax assets’
analysis was significant to our audit because the assessment process is based on assumptions that are affected by expected future market or
economic conditions, and the expected performance of the Group and the Parent Company.

Audit Response

We obtained an understanding of the Group’s deferred income tax calculation process, including the applicable tax regulations. We reviewed
the management’s assessment on the availability of future taxable income considering the Group’s financial forecast and tax strategies. We also
discussed the business plans supporting such forecast with the management. We evaluated the forecast by comparing key assumptions, such
as loans and deposit growth rates, with the Group’s historical performance and the market outlook for the banking industry. We also reviewed the
availability of taxable income and the reversal of temporary differences’ timing to which the deferred tax assets are attributed to.

Other Information
Management is responsible for the other information. The other information comprises the information included in the SEC Form 20‑IS (Definitive
Information Statement), SEC Form 17‑A and Annual Report for the year ended December 31, 2016, but does not include the consolidated and
parent company financial statements and our auditor’s report thereon. The SEC Form 20‑IS (Definitive Information Statement), SEC Form 17‑A
and Annual Report for the year ended December 31, 2016 are expected to be made available to us after the date of this auditor’s report.

Our opinion on the consolidated and parent company financial statements does not cover the other information and we will not express any form
of assurance conclusion thereon.

In connection with our audits of the consolidated and parent company financial statements, our responsibility is to read the other information
identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the consolidated
and parent company financial statements or our knowledge obtained in the audits, or otherwise appears to be materially misstated.

Responsibilities of Management and Those Charged with Governance for the Consolidated and Parent Company Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated and parent company financial statements in accordance
with PFRSs, and for such internal control as management determines is necessary to enable the preparation of consolidated and parent company
financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated and parent company financial statements, management is responsible for assessing the Group’s and Parent
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless management either intends to liquidate the Group and the Parent Company or to cease operations, or has no realistic
alternative but to do so.

China Bank 99 Annual Report 2016

Those charged with governance are responsible for overseeing the Group’s and Parent Company financial reporting process.

Auditor’s Responsibilities for the Audit of the Consolidated and Parent Company Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated and parent company financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with PSAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these consolidated and parent company financial statements.

As part of an audit in accordance with PSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated and parent company financial statements, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the Group’s and Parent Company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by
management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained,
whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s and Parent Company’s ability
to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the
related disclosures in the consolidated and parent company financial statements or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may
cause the Group and the Parent Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated and parent company financial statements, including the disclosures,
and whether the consolidated and parent company financial statements represent the underlying transactions and events in a manner that
achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express
an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the audit. We remain
solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant
audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence,
and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where
applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the
consolidated and parent company financial statements of the current period and are therefore the key audit matters. We describe these matters in
our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine
that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh
the public interest benefits of such communication.

Report on the Supplementary Information Required Under Revenue Regulations 15‑2010

Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplementary information
required under Revenue Regulations 15‑2010 in Note 36 to the financial statements is presented for purposes of filing with the Bureau of Internal
Revenue and is not a required part of the basic financial statements. Such information is the responsibility of the management of China Banking
Corporation. The information has been subjected to the auditing procedures applied in our audit of the basic financial statements. In our opinion,
the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

The engagement partner on the audit resulting in this independent auditor’s report is Ray Francis C. Balagtas.

SYCIP GORRES VELAYO & CO.

Ray Francis C. Balagtas

Partner
CPA Certificate No. 108795
SEC Accreditation No. 1510-A (Group A),
October 1, 2015, valid until September 30, 2018
Tax Identification No. 216-950-288
BIR Accreditation No. 08-001998-107-2015,
March 4, 2015, valid until March 3, 2018
PTR No. 5908666, January 3, 2017, Makati City

China Bank 100 Annual Report 2016

BALANCE SHEETS
(Amounts in Thousands)

Consolidated Parent Company

December 31 January 1
2015 2015
2016 2015 2016 (As restated – Note 2)
ASSETS
Cash and Other Cash Items P12,010,543 P11,377,101 P10,580,748 P10,052,891 P9,295,130
Due from Bangko Sentral ng Pilipinas (Notes 7 and 16) 91,964,495 86,318,501 85,307,128 77,003,616 60,543,867
Due from Other Banks (Note 7) 11,332,236 21,243,492 9,689,165 19,200,544 15,836,701
Interbank Loans Receivables and Securities Purchased
under Resale Agreements 3,451,543 – 2,958,465 – 223,600
Financial Assets at Fair Value through Profit or Loss
(Note 8) 7,703,899 6,244,593 7,232,882 5,465,417 8,012,435
Available-for-Sale Financial Assets (Note 8) 33,873,723 48,829,233 31,153,750 46,834,199 37,075,238
Held-to-Maturity Financial Assets (Note 8) 57,404,800 16,136,147 54,069,021 13,945,645 11,353,788
Loans and Receivables (Notes 9 and 28) 386,827,300 309,761,777 329,069,859 259,645,008 245,257,221
Accrued Interest Receivable (Note 15) 3,014,529 2,621,737 2,666,353 2,201,247 1,910,677
Investment in Subsidiaries (Notes 2 and 10) – – 12,169,037 9,141,177 5,397,402
Investment in Associates (Notes and 10) 276,559 371,399 276,559 371,399 532,689
Bank Premises, Furniture, Fixtures and Equipment
(Note 11) 6,496,268 6,354,119 5,143,981 4,997,202 4,748,199
Investment Properties (Note 12) 5,349,739 5,398,139 1,760,876 1,899,862 1,901,363
Deferred Tax Assets (Note 26) 1,666,267 1,381,280 1,508,150 1,369,147 842,367
Intangible Assets (Notes 10 and 13) 4,089,715 3,972,308 805,582 762,808 455,000
Goodwill (Notes 10 and 13) 839,748 839,748 222,841 222,841 222,841
Other Assets (Note 14) 6,896,647 5,977,389 4,504,100 3,949,430 3,639,729
P633,198,011 P526,826,963 P559,118,497 P457,062,433 P407,248,247

LIABILITIES AND EQUITY

Liabilities
Deposit Liabilities (Notes 16 and 28)
Demand P135,263,113 P113,511,283 P122,265,663 P103,024,840 P88,942,591
Savings 141,155,766 114,046,323 132,772,300 104,135,171 86,798,098
Time 265,164,139 211,708,080 215,924,029 166,443,405 165,343,946
541,583,018 439,265,686 470,961,992 373,603,416 341,084,635
Bills Payable (Note 17) 16,954,998 19,085,180 16,954,998 18,422,650 5,177,601
Manager’s Checks 2,029,778 1,456,498 1,445,585 741,479 822,179
Income Tax Payable 437,303 375,780 354,212 345,312 1,397
Accrued Interest and Other Expenses (Note 18) 1,868,190 1,584,274 1,561,351 1,260,995 1,312,475
Derivative Liabilities (Note 24) 243,198 66,373 243,198 66,373 101,610
Deferred Tax Liabilities (Note 26) 1,161,414 1,116,147 – – –
Other Liabilities (Note 19) 5,533,908 4,706,121 4,205,745 3,445,764 2,182,919
569,811,807 467,656,059 495,727,081 397,885,989 350,682,816
Equity
Equity Attributable to Equity Holders of the
Parent Company
Capital stock (Note 22) 20,020,278 18,537,285 20,020,278 18,537,285 17,164,143
Capital paid in excess of par value (Note 22) 6,987,564 6,987,564 6,987,564 6,987,564 6,987,564
Surplus reserves (Notes 22 and 27) 861,630 828,406 861,630 828,406 800,006
Surplus (Notes 22 and 27) 36,889,099 33,800,748 36,889,099 33,800,748 31,312,038
Net unrealized gains (losses) on available-for-sale financial
assets (Note 8) (1,598,600) (1,126,080) (1,598,600) (1,126,080) 122,920
Remeasurement gain on defined benefit asset (Note 23) 253,945 183,155 253,945 183,155 199,152
Cumulative translation adjustment (22,500) (34,634) (22,500) (34,634) (20,392)
63,391,416 59,176,444 63,391,416 59,176,444 56,565,431
Non-controlling Interest (5,212) (5,540) – – –
63,386,204 59,170,904 63,391,416 59,176,444 56,565,431
P633,198,011 P526,826,963 P559,118,497 P457,062,433 P407,248,247

See accompanying Notes to Financial Statements.

China Bank 101 Annual Report 2016

STATEMENTS OF INCOME
(Amounts in Thousands)

Consolidated Parent Company

Years ended December 31 January 1
2015 2015
2016 2015 2014 2016 (As restated – Note 2)
INTEREST INCOME
Loans and receivables (Notes 9 and 28) P17,889,252 P15,900,727 P14,674,211 P14,122,287 P12,324,959 P11,295,416
Trading and investments (Note 8) 3,282,963 3,100,802 3,021,786 3,060,325 2,946,914 2,872,124
Due from Bangko Sentral ng Pilipinas and other banks
(Note 7) 719,414 315,805 701,142 555,788 182,662 465,089
21,891,629 19,317,334 18,397,139 17,738,400 15,454,535 14,632,629
INTEREST EXPENSE
Deposit liabilities (Notes 16 and 28) 4,831,555 4,008,288 4,016,718 3,629,127 2,881,166 2,904,698
Bills payable and other borrowings (Note 17) 365,879 223,862 291,674 354,961 184,280 141,825
5,197,434 4,232,150 4,308,392 3,984,088 3,065,446 3,046,523
NET INTEREST INCOME 16,694,195 15,085,184 14,088,747 13,754,312 12,389,089 11,586,106
Service charges, fees and commissions (Note 20) 2,123,469 1,834,318 1,561,807 1,319,448 1,456,140 1,220,649
Trading and securities gain - net (Notes 8 and 20) 918,089 466,834 535,263 852,870 459,996 458,896
Gain on sale of investment properties 443,315 375,754 355,065 338,088 353,249 363,192
Foreign exchange gain - net (Note 24) 318,135 330,056 329,944 299,113 306,541 335,848
Trust fee income (Note 27) 330,197 276,240 251,489 326,091 272,251 249,371
Gain on asset foreclosure and dacion transactions
(Note 12) 172,480 274,978 138,557 140,747 150,177 82,306
Share in net income (losses) of subsidiaries (Note 10) – – – 464,999 (201,901) (369,126)
Share in net losses of an associate (Note 10) (89,384) (37,893) (912) (89,384) (37,893) (912)
Miscellaneous (Notes 20 and 28) 878,445 966,855 1,588,064 800,097 891,953 1,391,226
TOTAL OPERATING INCOME 21,788,941 19,572,326 18,848,024 18,206,381 16,039,602 15,317,556
Compensation and fringe benefits (Notes 23 and 28) 4,982,934 4,674,469 4,170,574 3,752,229 3,532,596 3,030,719
Occupancy cost (Notes 25 and 28) 1,830,675 1,723,277 1,669,408 1,281,107 1,207,677 1,206,551
Taxes and licenses 2,000,404 1,587,118 1,737,435 1,573,887 1,252,878 1,406,652
Insurance 1,163,507 990,788 898,228 991,179 827,026 751,526
Depreciation and amortization (Notes 11, 12 and 13) 1,124,786 979,412 921,764 775,210 676,286 630,577
Provision for impairment and credit losses (Note 15) 850,546 966,574 440,901 521,475 487,485 100,920
Transportation and traveling 298,666 311,587 371,653 218,136 222,276 285,042
Professional fees, marketing and other related services 268,394 245,760 229,015 182,275 187,773 165,534
Entertainment, amusement and recreation 242,710 276,809 323,537 146,993 156,289 207,048
Stationery, supplies and postage 241,786 241,151 195,209 193,232 150,956 149,155
Repairs and maintenance 123,025 160,902 188,589 87,734 102,882 131,855
Miscellaneous (Notes 20 and 28) 1,073,986 1,001,934 1,021,799 941,489 800,742 725,313
TOTAL OPERATING EXPENSES 14,201,419 13,159,781 12,168,112 10,664,946 9,604,866 8,790,892
INCOME BEFORE INCOME TAX 7,587,522 6,412,545 6,679,912 7,541,435 6,434,736 6,526,664
PROVISION FOR INCOME TAX (Note 26) 1,126,552 809,969 1,564,927 1,083,139 828,070 1,408,832
NET INCOME P6,460,970 P5,602,576 P5,114,985 P6,458,296 P5,606,666 P5,117,832
Attributable to:
Equity holders of the Parent Company (Note 31) P6,458,296 P5,606,666 P5,117,832
Non-controlling interest 2,674 (4,090) (2,847)
P6,460,970 P5,602,576 P5,114,985
Basic/Diluted Earnings Per Share (Note 31) P3.23 P2.80* P2.55*

* Restated to show the effects of stock dividends distributed in 2016 (Note 22).
See accompanying Notes to Financial Statements.

China Bank 102 Annual Report 2016

STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in Thousands)

Consolidated Parent Company

Years ended December 31 January 1
2015 2015
2016 2015 2014 2016 (As restated – Note 2)
NET INCOME P6,460,970 P5,602,576 P5,114,985 P6,458,296 P5,606,666 P5,117,832
OTHER COMPREHENSIVE INCOME (LOSS)
Items that recycle to profit or loss in subsequent
periods:
Changes in fair value of available-for-sale financial
assets:
Fair value gain (loss) for the year, net of tax 449,110 (487,124) 752,517 512,561 (464,471) 730,007
Gains taken to profit or loss (Note 20) (918,673) (638,723) (544,094) (856,031) (629,642) (541,653)
Share in changes in net unrealized gain on
available-for-sale financial assets of an
associate (Note 10) (5,457) (123,397) (5,970) (5,457) (123,397) (5,970)
Share in changes in other comprehensive income
of subsidiaries (Note 10) – – – (87,594) (56,844) (71,892)
Cumulative translation adjustment 12,455 (14,242) (86,686) (3,636) (14,914) (87,715)
Items that do not recycle to profit or loss in
subsequent periods:
Remeasurement gain (loss) on defined benefit asset,
net of tax (Note 23) 71,075 (16,734) (405,854) 50,560 10,030 (312,902)
OTHER COMPREHENSIVE LOSS FOR THE YEAR,
NET OF TAX (391,490) (1,280,220) (290,087) (389,596) (1,279,238) (290,125)
TOTAL COMPREHENSIVE INCOME FOR THE
YEAR P6,069,480 P4,322,356 P4,824,898 P6,068,700 P4,327,428 P4,827,707
Total comprehensive income attributable to:
Equity holders of the Parent Company P6,068,700 P4,327,428 P4,827,707
Non-controlling interest 780 (5,072) (2,809)
P6,069,480 P4,322,356 P4,824,898

See accompanying Notes to Financial Statements.

China Bank 103 Annual Report 2016

STATEMENTS OF CHANGES IN EQUITY
(Amounts in Thousands)

Capital Paid in
Excess of Surplus
Capital Stock Par Value Reserves Surplus
(Note 22) (Note 22) (Notes 22 and 27) (Notes 22 and 27)
Balance at January 1, 2016 P18,537,285 P6,987,564 P828,406 P33,800,748
Total comprehensive income (loss) for the year − − − 6,458,296
Additional acquisition of non-controlling interest − − −
Transfer from surplus to surplus reserves − − 33,224 (33,224)
Stock dividends - 8.00% 1,482,993 − − (1,482,993)
Cash dividends - P1.00 per share − − − (1,853,728)
Balance at December 31, 2016 P20,020,278 P6,987,564 P861,630 P36,889,099
Balance at January 1, 2015 P17,164,143 P6,987,564 P800,006 P31,312,038
Total comprehensive income (loss) for the year − − − 5,606,666
Additional acquisition of non-controlling interest − − − −
Transfer from surplus to surplus reserves − − 28,400 (28,400)
Stock dividends - 8.00% 1,373,142 − − (1,373,142)
Cash dividends - P1.00 per share − − − (1,716,414)
Balance at December 31, 2015 P18,537,285 P6,987,564 P828,406 P33,800,748
Balance at January 1, 2014 P14,276,616 P671,505 P775,069 P29,079,843
Total comprehensive income (loss) for the year − − − 5,117,832
Transfer from surplus to surplus reserves − − 24,937 (24,937)
Issuance of common shares (P49.50 per share) 1,616,099 6,383,590 − −
Transaction costs on the issuance of common shares − (67,531) − −
Stock dividends - 8.00% 1,271,428 − − (1,271,428)
Cash dividends - P1.00 per share − − − (1,589,272)
Balance at December 31, 2014 P17,164,143 P6,987,564 P800,006 P31,312,038

See accompanying Notes to Financial Statements.

Capital Paid in
Excess of Surplus
Capital Stock Par Value Reserves
(Note 22) (Note 22) (Notes 22 and 27)
Balance at January 1, 2016, as previously reported P18,537,285 P6,987,564 P827,231
Effect of retroactive application of PAS 27 (Amendment) (Note 2) – – 1,175
Balance at January 1, 2016, as restated 18,537,285 6,987,564 828,406
Total comprehensive income (loss) for the year – – –
Transfer from surplus to surplus reserves – – 33,224
Stock dividends - 8.00% 1,482,993 – –
Cash dividends - P1.00 per share – – –
Balance at December 31, 2016 P20,020,278 P6,987,564 P861,630
Balance at January 1, 2015, as previously reported P17,164,143 P6,987,564 P800,006
Effect of retroactive application of PAS 27 (Amendment) (Note 2) – – –
Balance at January 1, 2015, as restated 17,164,143 6,987,564 800,006
Total comprehensive income (loss) for the year – – –
Transfer from surplus to surplus reserves – – 28,400
Stock dividends - 8.00% 1,373,142 – –
Cash dividends - P1.00 per share – – –
Balance at December 31, 2015 P18,537,285 P6,987,564 P828,406
Balance at January 1, 2014 P14,276,616 P671,505 P775,069
Effect of retroactive application of PAS 27 (Amendment) (Note 2) – – –
Balance at January 1, 2014, as restated 14,276,616 671,505 775,069
Total comprehensive income (loss) for the year – – –
Transfer from surplus to surplus reserves – – 24,937
Issuance of common shares (P49.50 per share) 1,616,099 6,383,590 −
Transaction costs on the issuance of common shares − (67,531) −
Stock dividends - 8.00% 1,271,428 – –
Cash dividends - P1.00 per share – – –
Balance at December 31, 2014 P17,164,143 P6,987,564 P800,006

See accompanying Notes to Financial Statements.

China Bank 104 Annual Report 2016

 Consolidated
Equity Attributable to Equity Holders of the Parent Company
Net Unrealized Remeasurement
Gains(Losses) Gain on Defined
on Available-for- Benefit Asset or Cumulative Non-controlling
Sale Financial Liability Translation Interest
Assets (Note 8) (Note 23) Adjustment Total (Note 10) Total Equity
(P1,126,080) P183,155 (P34,634) P59,176,444 (P5,540) P59,170,904
(472,520) 70,790 12,134 6,068,700 780 6,069,480
− − − − (452) (452)
− − − − − −
− − − − − −
− − − (1,853,728) − (1,853,728)
(P1,598,600) P253,945 (P22,500) P63,391,416 (P5,212) P63,386,204
P122,920 P199,151 (P20,392) P56,565,430 P2,053 P56,567,483
(1,249,000) (15,996) (14,242) 4,327,428 (5,072) 4,322,356
− − − − (2,521) (2,521)
− − − − − −
− − − − − −
− − − (1,716,414) − (1,716,414)
(P1,126,080) P183,155 (P34,634) P59,176,444 (P5,540) P59,170,904
(P79,258) P604,715 P66,347 P45,394,837 P4,862 P45,399,699
202,178 (405,564) (86,739) 4,827,707 (2,809) 4,824,898
− − − − − −
– – – 7,999,689 − 7,999,689
– – – (67,531) − (67,531)
– – – − − −
– – – (1,589,272) − (1,589,272)
P122,920 P199,151 (P20,392) P56,565,430 P2,053 P56,567,483

Parent Company
Net Unrealized
Gains(Losses) on Remeasurement
Available-for- Gain on Defined Cumulative
Surplus Sale Financial Benefit Asset or Translation
(Notes 22 and 27) Assets (Note 8) Liability (Note 23) Adjustment Total Equity
P34,219,656 (P979,614) P293,771 (P36,281) P59,849,612
(418,908) (146,466) (110,616) 1,647 (673,168)
33,800,748 (1,126,080) 183,155 (34,634) 59,176,444
6,458,296 (472,520) 70,790 12,134 6,068,700
(33,224) – – – –
(1,482,993) – – – –
(1,853,728) – – – (1,853,728)
P36,889,099 (P1,598,600) P253,945 (P22,500) P63,391,416
P31,489,977 P114,499 P283,741 (P21,367) P56,818,563
(177,939) 8,421 (84,589) 975 (253,132)
31,312,038 122,920 199,152 (20,392) 56,565,431
5,606,666 (1,249,000) (15,997) (14,242) 4,327,427
(28,400) – – – –
(1,373,142) – – – –
(1,716,414) – – – (1,716,414)
P33,800,748 (P1,126,080) P183,155 (P34,634) P59,176,444
P29,261,042 (P73,855) P596,643 P66,348 P45,573,368
(181,199) (5,403) 8,072 – (178,530)
29,079,843 (79,258) 604,715 66,348 45,394,838
5,117,832 202,178 (405,563) (86,740) 4,827,707
(24,937) – – – –
− – – – 7,999,689
− – – – (67,531)
(1,271,428) – – – –
(1,589,272) – – – (1,589,272)
P31,312,038 P122,920 P199,152 (P20,392) P56,565,431

China Bank 105 Annual Report 2016

STATEMENTS OF CASH FLOWS
(Amounts in Thousands)

Consolidated Parent Company

Years ended December 31 January 1
2015 2015
2016 2015 2014 2016 (As restated – Note 2)
CASH FLOWS FROM OPERATING
ACTIVITIES
Income before income tax P7,587,522 P6,412,545 P6,679,912 P7,541,435 P6,434,736 P6,526,664
Adjustments for:
Depreciation and amortization
(Notes 11, 12 and 13) 1,124,786 979,412 921,764 775,210 676,286 630,577
Provision for impairment and credit
losses (Notes 12 and 14) 84,758 46,592 988,201 25,065 358 (766)
Trading and securities gain on
available-for-sale financial assets
(Note 20) (918,673) (638,723) (544,094) (856,031) (629,642) (541,653)
Gain on sale of investment properties (443,315) (375,754) (355,065) (338,088) (353,249) (363,192)
Gain on asset foreclosure and dacion
transactions (Note 12) (172,480) (274,978) (138,557) (140,747) (150,177) (82,306)
Gain on acquisition of additional
shares of an associate (Note 10) – – (373,297) – – (373,297)
Share in net losses of an associate
(Notes 2 and 10) 89,384 37,893 912 89,384 37,893 912
Share in net losses (income) of – – –
subsidiaries (Notes 2 and 10) (464,999) 201,900 369,126
Gain on sale of investments in
associates (Note 10) – – (64,557) – – –
Amortization of transaction costs – – (61,855) – – –
Changes in operating assets and
liabilities:
Decrease (increase) in the amounts of:
Financial assets at FVPL (1,282,482) 2,160,869 5,742,304 (1,590,640) 2,511,781 2,355,789
Loans and receivables (78,070,247) (20,521,459) (37,932,588) (70,046,054) (14,585,919) (35,019,984)
Other assets (1,225,573) (444,632) (2,397,839) (882,576) (1,230,263) (639,817)
Increase (decrease) in the amounts of:
Deposit liabilities 102,317,332 39,964,142 463,406 97,358,575 32,518,781 1,252,781
Manager’s checks 573,280 235,103 189,248 704,106 (80,700) 117,691
Accrued interest and other
expenses 283,916 (46,474) (304,814) 300,356 (51,480) (133,146)
Other liabilities 827,790 1,070,312 (199,381) 759,981 1,262,845 (778,487)
Net cash generated from (used in)
operations 30,776,000 28,604,848 (27,386,300) 33,234,977 26,563,150 (26,679,108)
Income taxes paid (973,575) (507,801) (565,202) (863,477) (414,842) (487,635)
Net cash provided by (used in) operating
activities 29,802,425 28,097,047 (27,951,502) 32,371,500 26,148,308 (27,166,743)
CASH FLOWS FROM INVESTING
ACTIVITIES
Additions to bank premises, furniture,
fixtures and equipment (Note 11) (1,258,911) (1,493,982) (1,063,905) (1,065,308) (1,400,741) (895,274)
Acquisition through business combination
- net of cash acquired (Note 10) – – 4,051,917 – – –
Additions to equity investments (Note 10) – – – (2,700,452) (4,002,521) (4,089,200)
Liquidation of a subsidiary (Note 10) – – – 50,000 – –
Purchases of:
Held-to-maturity financial assets (41,647,865) (4,490,149) (696,783) (41,007,909) (3,081,425) –
Available-for-sale financial assets (89,249,294) (54,192,915) (22,893,153) (87,747,373) (53,870,729) (22,211,530)
Proceeds from sale/maturity of:
Held-to-maturity financial assets 374,569 463,346 804,157 884,532 489,568 768,801
Available-for-sale financial assets 104,653,914 43,031,164 29,570,640 103,940,382 43,647,299 29,062,490
Investment properties 977,963 1,137,792 1,449,958 675,003 327,682 954,913
Bank premises, furniture, fixtures and
equipment 151,286 567,758 304,304 199,460 571,677 325,410
Investments in associates (Note 10) – – 283,599 – – –
Net cash provided by (used in) investing
activities (25,998,338) (14,976,986) 11,810,734 (26,771,665) (17,319,190) 3,915,610
(Forward)

China Bank 106 Annual Report 2016

 Consolidated Parent Company
Years ended December 31 January 1
2015 2015
2016 2015 2014 2016 (As restated – Note 2)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from bills payable 18,588,791 19,151,089 4,629,728 18,588,791 18,488,559 4,335,248
Settlement of bills payable (20,718,973) (6,386,489) (8,480,028) (20,056,443) (5,243,510) (7,456,841)
Settlement of subordinated debt (Note 17) – (1,188,762) (525,000) – – –
Payments of cash dividends (Note 22) (1,853,728) (1,716,414) (1,589,272) (1,853,728) (1,716,414) (1,589,272)
Acquisitions of non-controlling interest
(Note 10) (452) (2,521) – – – –
Proceeds from issuance of common
shares (Note 22) – – 7,932,158 – – 7,932,158
Net cash provided by (used in) financing
activities (3,984,362) 9,856,903 1,967,586 (3,321,380) 11,528,635 3,221,293
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (P180,277) P22,976,964 (P14,173,182) P2,278,455 P20,357,753 (P20,029,840)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF YEAR
Cash and other cash items 11,377,101 10,734,059 7,281,641 10,052,891 9,295,130 7,035,251
Due from Bangko Sentral ng Pilipinas
(Note 7) 86,318,501 67,451,648 78,968,133 77,003,616 60,543,867 75,678,312
Due from other banks (Note 7) 21,243,492 17,552,823 23,885,538 19,200,544 15,836,701 23,215,575
Interbank loans receivables – 223,600 – – 223,600 −
118,939,094 95,962,130 110,135,312 106,257,051 85,899,298 105,929,138
CASH AND CASH EQUIVALENTS AT
END OF YEAR
Cash and other cash items 12,010,543 11,377,101 10,734,059 10,580,748 10,052,891 9,295,130
Due from Bangko Sentral ng Pilipinas
(Note 7) 91,964,495 86,318,501 67,451,648 85,307,128 77,003,616 60,543,867
Due from other banks (Note 7) 11,332,236 21,243,492 17,552,823 9,689,165 19,200,544 15,836,701
Interbank loans receivables 3,451,543 – 223,600 2,958,465 – 223,600
P118,758,817 P118,939,094 P95,962,130 P108,535,506 P106,257,051 P85,899,298

OPERATING CASH FLOWS FROM INTEREST

Consolidated Parent Company

As of December 31 January 1
2015 2014
2016 2015 2014 2016 (As restated – Note 2)
Interest paid P5,028,667 P4,240,401 P4,304,420 P3,812,560 P3,020,972 P3,159,848
Interest received 21,498,837 18,932,577 18,059,567 17,273,294 15,163,965 14,523,547

See accompanying Notes to Financial Statements.

China Bank 107 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

1. CORPORATE INFORMATION

China Banking Corporation (the Parent Company) is a publicly listed commercial bank incorporated in the Philippines. The Parent Company
acquired its universal banking license in 1991. It provides expanded commercial banking products and services such as deposit products,
loans and trade finance, domestic and foreign fund transfers, treasury products, trust products, foreign exchange, corporate finance and other
investment banking services through a network of 391 and 352 local branches as of December 31, 2016 and 2015, respectively.

The Parent Company acquired its original Certification of Incorporation issued by the Securities and Exchange Commission (SEC) on
July 20, 1920. On December 4, 1963, the Board of Directors (BOD) of the Parent Company approved the Amended Articles of Incorporation
to extend the corporate term of the Parent Company for another 50 years or until July 20, 2020, which was confirmed by the stockholders
on December 23, 1963, and approved by the SEC on October 5, 1964. On March 2, 2016, the BOD approved the amendment of the Third
Article of the Parent Company’s Articles of Incorporation, to further extend the corporate term for another 50 years from and after July 20,
2020, the expiry date of its extended term. The approval was ratified by the stockholders during their scheduled annual meeting on May 5,
2016. On November 7, 2016, the SEC issued the Certificate of Filing of Amended Articles of Incorporation, amending the Third Article thereof
to extend the term of corporate existence of the Parent Company.

The Parent Company has the following subsidiaries:

Effective Percentages of
Ownership Country of
Subsidiary 2016 2015 Incorporation Principal Activities
Chinabank Insurance Brokers, Inc. (CIBI) 100.00% 100.00% Philippines Insurance brokerage
CBC Properties and Computer Center, Inc. (CBC-PCCI) 100.00% 100.00% Philippines Computer services
CBC Forex Corporation* — 100.00% Philippines Foreign exchange
China Bank Savings, Inc. (CBSI) 98.29% 98.07% Philippines Retail and consumer banking
China Bank Capital Corporation (CBCC) 100.00% 100.00% Philippines Investment house
CBC Assets One, Inc.** 100.00% — Philippines Special purpose corporation
* Liquidated on December 19, 2016
**Established in 2016, 100% owned through CBCC

On May 19, 2016, the BOD of CBCC approved the acquisition of ATC Securities, Inc. (ASI). On June 29, 2016, CBCC and the stockholders
of ASI signed the Share Purchase Agreement (SPA) covering the purchase of CBCC of the 100.00% shares of ASI. The stock brokerage house
shall be known as China Bank Securities Corporation. On the same date, 10% of the purchase price has been paid. On February 22, 2017,
the Philippine Stock Exchange approved the transfer of shares of ASI to CBCC pursuant to Article III, Section 4 of the Rules Governing Trading
Rights and Trading Participants. With the regulatory approval, the Group obtained control of ASI effective February 22, 2017.

The Parent Company has no ultimate parent company. SM Investments Corporation, its significant investor, has effective ownership in the
Parent Company of 17.21% and 19.90% as of December 31, 2016 and 2015, respectively.

The Parent Company’s principal place of business is at 8745 Paseo de Roxas cor. Villar St., Makati City.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Preparation
The accompanying consolidated financial statements include the financial statements of the Parent Company and its subsidiaries (collectively
referred to as “the Group”).

The accompanying financial statements have been prepared on a historical cost basis except for financial instruments at fair value through profit
or loss (FVPL) and available-for-sale (AFS) financial assets. The financial statements are presented in Philippine peso, and all values are rounded
to the nearest thousand peso except when otherwise indicated.

The financial statements of the Parent Company reflect the accounts maintained in the Regular Banking Unit (RBU) and Foreign Currency
Deposit Unit (FCDU). The financial statements of these units are combined after eliminating inter-unit accounts.

Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using
that functional currency. The functional currency of the Parent Company’s subsidiaries is the Philippine peso.

China Bank 108 Annual Report 2016

Statement of Compliance
The financial statements of the Group and the Parent Company have been prepared in compliance with Philippine Financial Reporting Standards
(PFRS).

Presentation of Financial Statements

The balance sheets of the Group and of the Parent Company are presented in order of liquidity. An analysis regarding recovery of assets or
settlement of liabilities within 12 months after the reporting date (current) and more than 12 months after the reporting date (non-current) is
presented in Note 21.

Financial assets and financial liabilities are offset and the net amount reported in the balance sheets only when there is a legally enforceable right
to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the assets and settle the liability simultaneously.
The Group and the Parent Company assess that they have currently enforceable right of offset if the right is not contingent on a future event,
and is legally enforceable in the normal course of business, event of default, and event of insolvency or bankruptcy of the Group, the Parent
Company and all of the counterparties.

Income and expenses are not offset in the statement of income unless required or permitted by any accounting standard or interpretation, and
as specifically disclosed in the accounting policies of the Group and the Parent Company.

Basis of Consolidation and Investments in Subsidiaries

The consolidated financial statements of the Group are prepared for the same reporting year as the Parent Company, using consistent
accounting policies. All significant intra-group balances, transactions and income and expenses resulting from intra-group transactions are
eliminated in full.

Subsidiaries are consolidated from the date on which control is transferred to the Parent Company.
The Group controls an investee if and only if the Group has:

• power over the investee (i.e., existing rights that give it the current ability to direct the relevant activities of the investee);
• exposure, or rights, to variable returns from its involvement with the investee, and
• the ability to use its power over the investee to affect its returns.

When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances
in assessing whether it has power over an investee, including:

• the contractual arrangement with the other vote holders of the investee
• rights arising from other contractual arrangements
• the Group’s voting rights and potential voting rights.

The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the
three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group
loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in
the statement of comprehensive income from the date the Group gains control until the date the Group ceases to control the subsidiary. Profit
or loss and each component of other comprehensive income (OCI) are attributed to the equity holders of the Group and to the non-controlling
interests. When necessary, adjustments are made to the financial statements of the subsidiary to bring its accounting policies into line with the
Group’s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between
members of the Group are eliminated in full on consolidation.

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control
over a subsidiary, it:

• Derecognizes the assets (including goodwill) and liabilities of the subsidiary

• Derecognizes the carrying amount of any non-controlling interest
• Derecognizes the related OCI recorded in equity and recycle the same to profit or loss or surplus
• Recognizes the fair value of the consideration received
• Recognizes the fair value of any investment retained
• Recognizes the remaining difference in profit or loss
• Reclassifies the parent’s share of components previously recognized in OCI to profit or loss or retained earnings, as appropriate, as would
be recognized if the Group had directly disposed of the related assets or liabilities

Non-Controlling Interest
Non-controlling interest represents the portion of profit or loss and net assets not owned, directly or indirectly, by the Parent Company.

Non-controlling interest is presented separately in the consolidated statement of income, consolidated statement of comprehensive income,
and within equity in the consolidated balance sheet, separately from parent shareholders’ equity. Any losses applicable to the non-controlling
interest are allocated against the interests of the non-controlling interest even if this results in the non-controlling interest having a deficit balance.

China Bank 109 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Changes in Accounting Policies and Disclosures

The accounting policies adopted are consistent with those of the previous financial year except for the following new, amendments and
improvements to PFRS, Philippine Accounting Standards (PAS) and Philippine Interpretation which became effective as of January 1, 2016.
Except as otherwise indicated, these changes in the accounting policies did not have any significant impact on the financial position or
performance of the Group:

• New and Amended Standards

• Amendments to PFRS 10, Consolidated Financial Statements, and PAS 28, Investment in Associates and Joint Ventures - Investment
Entities: Applying the Consolidation Exception
• Amendments to PFRS 11, Joint Arrangements - Accounting for Acquisitions of Interests in Joint Operations
• Amendments to PAS 1, Presentation of Financial Statements - Disclosure Initiative
• PFRS 14, Regulatory Deferral Accounts
• Amendments to PAS 16, Property, Plant and Equipment, and PAS 41, Agriculture - Bearer Plants
• Amendments to PAS 16, Property, Plant and Equipment, and PAS 38, Intangible Assets - Clarification of Acceptable Method of
Depreciation and Amortization

• Annual Improvements to PFRSs (2012 – 2014 Cycle)

• PFRS 5, Non-current Assets Held for Sale and Discontinued Operations – Changes in Methods of Disposal
• PFRS 7, Financial Instruments: Disclosures – Servicing Contracts
• PFRS 7, Applicability of the Amendments to PFRS 7 to Condensed Interim Financial Statements
• PAS 19, Employee Benefits – Regional Market Issue Regarding Discount Rate
• PAS 34, Interim Financial Reporting – Disclosure of Information ‘Elsewhere in the Interim Financial Report’

On January 1, 2016, the Group adopted the amendments to PAS 27, Separate Financial Statements – Equity Method in Separate Financial
Statements (Amendments). The amendments allow entities to use the equity method to account for investments in subsidiaries, joint ventures
and associates in their separate financial statements. The Parent Company elected to use the equity method in its separate financial statements
in line with BSP Circular 915, issued in July 5, 2016, which provides guidance for banks on financial reporting requirements. The effects of the
adoption of the amended PAS 27 are detailed below:

Parent Company
As previously Restatement
reported adjustments As restated
Balance sheets

December 31, 2015

Asset
Investment in subsidiaries P10,019,471 (P878,294) P9,141,177
Investment in associate 166,273 205,126 371,399
Equity
Surplus 34,219,656 (418,908) 33,800,748
Surplus reserves 827,231 1,175 828,406
Net unrealized losses on AFS financial assets (979,614) (146,466) (1,126,080)
Remeasurement gain on defined benefit asset 293,771 (110,616) 183,155
Cumulative translation adjustment (36,281) 1,647 (34,634)
January 1, 2015
Asset
Investment in subsidiaries P6,016,950 (P619,548) P5,397,402
Investment in associate 166,273 366,416 532,689
Equity
Surplus 31,489,977 (177,939) 31,312,038
Surplus reserves 800,006 ‒ 800,006
Net unrealized gains (losses) on AFS 114,499 8,421 122,920
Net unrealized losses on defined benefit financial asset 283,741 (84,589) 199,152
Cumulative translation adjustment (21,367) 975 (20,392)

China Bank 110 Annual Report 2016

 Parent Company
As previously Restatement
reported adjustments As restated
Statements of income

For the year ended December 31, 2015

Share in net losses of subsidiaries P‒ (P201,900) (P201,900)
Share in net losses of an associate ‒ (37,893) (37,893)

For the year ended December 31, 2014

Share in net losses of subsidiaries ‒ (369,126) (369,126)
Share in net losses of an associate ‒ (912) (912)

Statements of comprehensive income

For the year ended December 31, 2015

Share in net losses of subsidiaries P‒ (P201,900) (P201,900)
Share in net losses of an associate ‒ (37,893) (37,893)
Share in changes in other comprehensive income of subsidiaries ‒ (126,068) (126,068)
Share in changes in net unrealized gain on available-for-sale ‒ (129,367) (129,367)
financial assets of an associate

For the year ended December 31, 2014

Share in net losses of subsidiaries ‒ (369,126) (369,126)
Share in net losses of an associate ‒ (912) (912)
Share in changes in other comprehensive income of subsidiaries ‒ (69,223) (69,223)
Share in changes in net unrealized gain on available-for-sale ‒ (5,970) (5,970)
financial assets of an associate

Significant Accounting Policies

Foreign Currency Translation

The consolidated financial statements are presented in Philippine peso, which is the Parent Company’s functional currency.

Transactions and balances

The books of accounts of the RBU are maintained in Philippine peso, the RBU’s functional currency, while those of the FCDU are maintained in
United States (US) dollars (USD), the FCDU’s functional currency. For financial reporting purposes, the foreign currency-denominated monetary
assets and liabilities in the RBU are translated in Philippine peso based on the Philippine Dealing System (PDS) closing rate prevailing at end of
the year, and foreign currency-denominated income and expenses, at the exchange rates on transaction dates. Foreign exchange differences
arising from restatements of foreign currency-denominated assets and liabilities are credited to or charged against operations in the period
in which the rates change. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using
the exchange rates at the date when the fair value was determined.

FCDU
As at the reporting date, the assets and liabilities of the FCDU are translated into the Parent Company’s presentation currency (the Philippine
Peso) at the PDS closing rate prevailing at the reporting date, and its income and expenses are translated at the PDSWAR for the year. Exchange
differences arising on translation are taken directly to the statement of comprehensive income under ‘Cumulative translation adjustment’. Upon
actual remittance or transfer of the FCDU income to RBU, the related exchange difference arising from translation lodged under ‘Cumulative
translation adjustment’ is recognized in the statement of income of the RBU books.

Fair Value Measurement

The Group measures financial instruments, such as financial instruments at FVPL and AFS financial assets at fair value at each reporting date.
Also, fair values of financial instruments measured at amortized cost are disclosed in Note 5.

China Bank 111 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants
at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability
takes place either:

• in the principal market for the asset or liability, or

• in the absence of a principal market, in the most advantageous market for the asset or liability.

The principal or the most advantageous market must be accessible by the Group. The fair value of an asset or a liability is measured using
the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic
best interest.

If an asset or a liability measured at fair value has a bid price and an ask price, the price within the bid - ask spread that is most representative
of fair value in the circumstances shall be used to measure fair value regardless of where the input is categorized within the fair value hierarchy.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the
asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value,
maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy,
described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

• Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities
• Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly
observable
• Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Group determines whether transfers have
occurred between Levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value
measurement as a whole) at the end of each reporting period.

Cash and Cash Equivalents

For purposes of reporting cash flows, cash and cash equivalents include cash and other cash items, due from BSP and other banks, and
interbank loans receivables that are convertible to known amounts of cash which have original maturities of three months or less from dates
of placements and that are subject to an insignificant risk of changes in value. Due from BSP includes the statutory reserves required by the
BSP which the Group considers as cash equivalents wherein withdrawals can be made to meet the Group’s cash requirements as allowed
by the BSP.

Financial Instruments - Initial Recognition and Subsequent Measurement

Date of recognition
Purchases or sales of financial assets, except for derivatives, that require delivery of assets within the time frame established by regulation or
convention in the marketplace are recognized on the settlement date. Settlement date accounting refers to (a) the recognition of an asset on the
day it is received by the Group, and (b) the derecognition of an asset and recognition of any gain or loss on disposal on the day that such asset is
delivered by the Group. Any change in fair value of unrecognized financial asset is recognized in the statement of income for assets classified as
financial assets at FVPL, and in equity for assets classified as AFS financial assets. Derivatives are recognized on a trade date basis. Deposits,
amounts due to banks and customers loans and receivables are recognized when cash is received by the Group or advanced to the borrowers.

Initial recognition of financial instruments

All financial instruments are initially recognized at fair value. Except for financial assets and financial liabilities at FVPL, the initial measurement
of financial instruments includes transaction costs. The Group classifies its financial assets in the following categories: financial assets at
FVPL, held-to-maturity (HTM) financial assets, AFS financial assets, and loans and receivables while financial liabilities are classified as financial
liabilities at FVPL and financial liabilities carried at amortized cost. The classification depends on the purpose for which the investments were
acquired and whether they are quoted in an active market. Management determines the classification of its investments at initial recognition
and, where allowed and appropriate, re-evaluates such designation at every reporting date.

‘Day 1’ difference
Where the transaction price in a non-active market is different with the fair value from other observable current market transactions in the same
instrument or based on a valuation technique whose variables include only data from observable market, the Group recognizes the difference
between the transaction price and fair value (a ‘Day 1’ difference) in the statement of income. In cases where the transaction price used is made
of data which is not observable, the difference between the transaction price and model value is only recognized in the statement of income
when the inputs become observable or when the instrument is derecognized. For each transaction, the Group determines the appropriate
method of recognizing the ‘Day 1’ difference amount.

Financial assets and financial liabilities at FVPL

Financial assets and financial liabilities at FVPL include financial assets and liabilities held for trading purposes, financial assets and financial
liabilities designated upon initial recognition as at FVPL, and derivative instruments.

China Bank 112 Annual Report 2016

Financial instruments held for trading
Financial instruments held for trading (HFT) include government debt securities and quoted equity securities purchased and held principally with
the intention of selling them in the near term. These securities are carried at fair value, and realized and unrealized gains and losses on these
instruments are recognized as ‘Trading and securities gain - net’ in the statement of income. Interest earned or incurred on financial instruments
held for trading is reported in the statement of income under ‘Interest income’ (for financial assets) and ‘Interest expense’ (for financial liabilities).

Financial instruments designated at FVPL

Financial assets and financial liabilities are designated as at FVPL by management on initial recognition when any of the following criteria is met:

• the designation eliminates or significantly reduces the inconsistent treatment that would otherwise arise from measuring the assets or
liabilities or recognizing gains or losses on them on a different basis; or
• the assets and liabilities are part of a group of financial assets, financial liabilities or both which are managed and their performance
evaluated on a fair value basis, in accordance with a documented risk management or investment strategy; or
• the financial instrument contains an embedded derivative, unless the embedded derivative does not significantly modify the cash flows or
it is clear, with little or no analysis, that it would not be separately recorded.

Financial assets and financial liabilities at FVPL are recorded in the balance sheet at fair value. Changes in fair value are recognized in ‘Trading
and securities gain - net’ in the statement of income. Interest earned or incurred is reported in the statement of income under ‘Interest income’
or ‘Interest expense’, respectively, while dividend income is reported in the statement of income under ‘Miscellaneous income’ when the right
to receive payment has been established.

Derivatives recorded at FVPL

The Parent Company is a party to derivative instruments, particularly, forward exchange contracts, interest rate swaps (IRS) and warrants.
These contracts are entered into as a service to customers and as a means of reducing and managing the Parent Company’s foreign exchange
risk, and interest rate risk as well as for trading purposes, but are not designated as hedges. Such derivative financial instruments are stated
at fair value through profit or loss.

Any gains or losses arising from changes in fair value of derivative instruments that do not qualify for hedge accounting are taken directly to the
statement of income under ‘Foreign exchange gain (loss) - net’ for forward exchange contracts and ‘Trading and securities gain-net’ for IRS
and warrants.

Embedded derivatives that are bifurcated from the host financial and non-financial contracts are also accounted for at FVPL.

An embedded derivative is separated from the host contract and accounted for as a derivative if all of the following conditions are met: (a) the
economic characteristics and risks of the embedded derivative are not closely related to the economic characteristic of the host contract; (b) a
separate instrument with the same terms as the embedded derivative would meet the definition of a derivative; and (c) the hybrid or combined
instrument is not recognized at fair value through profit or loss.

The Group assesses whether embedded derivatives are required to be separated from the host contracts when the Group first becomes a
party to the contract. Reassessment of embedded derivatives is only done when there are changes in the contract that significantly modifies
the contractual cash flows that would otherwise be required.

Held-to-maturity financial assets

HTM financial assets are quoted non-derivative financial assets with fixed or determinable payments and fixed maturities for which the Group’s
management has the positive intention and ability to hold to maturity. Where the Group would sell other than an insignificant amount of HTM
financial assets, the entire category would be tainted and reclassified as AFS financial assets.

After initial measurement, these investments are subsequently measured at amortized cost using the effective interest method, less any
impairment in value. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees that are an integral
part of the effective interest rate (EIR). The amortization is included in ‘Interest income’ in the statement of income. Gains and losses are
recognized in income when the HTM financial assets are derecognized and impaired, as well as through the amortization process. The losses
arising from impairment of such investments are recognized in the statement of income under ‘Provision for impairment and credit losses’. The
effects of translation of foreign currency-denominated HTM financial assets are recognized in the statement of income.

Loans and receivable

This accounting policy relates to the balance sheet captions ‘Due from BSP’, ‘Due from other banks’, ‘Interbank loans receivables’, ‘Loans
and receivables’, and ‘Accrued interest receivable’. It also applies to accounts receivable and other financial instruments shown under ‘Other
assets’. These are financial assets with fixed or determinable payments that are not quoted in an active market, other than:

• those that the Group intends to sell immediately or in the near term and those that the Group, upon initial recognition, designates as FVPL;
• those that the Group, upon initial recognition, designates as AFS; and
• those for which the Group may not cover substantially all of its initial investment, other than because of credit deterioration.

After initial measurement, these are subsequently measured at amortized cost using the effective interest method, less allowance for impairment.
Amortized cost is calculated by taking into account any discount or premium on acquisition and fees and costs that are an integral part of the
EIR. The amortization is included under ‘Interest income’ in the statement of income. The losses arising from impairment are recognized under
‘Provision for impairment and credit losses’ in the statement of income.

China Bank 113 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Available-for-sale financial assets

AFS financial assets are those which are designated as such or do not qualify to be classified as financial assets at FVPL, HTM financial assets,
or loans and receivables. They are purchased and held indefinitely, and may be sold in response to liquidity requirements or changes in market
conditions. They include equity investments, money market papers and other debt instruments.

After initial measurement, AFS financial assets are subsequently measured at fair value. The effective yield component of AFS debt securities,
as well as the impact of translation of foreign currency-denominated AFS debt securities, is reported in the statement of income. The unrealized
gains and losses arising from the fair valuation of AFS financial assets are excluded, net of tax, from reported earnings and are reported as ‘Net
unrealized gains (losses) on AFS financial assets’ under OCI.

When the security is disposed of, the cumulative gain or loss previously recognized in OCI is recognized as ‘Trading and securities gain - net’
in the statement of income. Interest earned on holding AFS debt securities are reported as ‘Interest income’ using the EIR. Dividends earned
on holding AFS equity instruments are recognized in the statement of income as ‘Miscellaneous income’ when the right to the payment has
been established. The losses arising from impairment of such investments are recognized as ‘Provision for impairment and credit losses’ in the
statement of income.

Other financial liabilities

These are issued financial instruments or their components which are not designated as at FVPL and where the substance of the contractual
arrangement results in the Group having an obligation either to deliver cash or another financial asset to the holder, or to satisfy the obligation
other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of its own equity shares. The components
of issued financial instruments that contain both liability and equity elements are accounted for separately, with the equity component being
assigned the residual amount after deducting from the instrument as a whole the amount separately determined as the fair value of the liability
component on the date of issue.

After initial measurement, other financial liabilities not qualified and not designated as at FVPL are subsequently measured at amortized cost
using the effective interest method. Amortized cost is calculated by taking into account any discount or premium on the issue and fees that are
an integral part of the EIR.

This accounting policy relates to the balance sheet captions ‘Deposit liabilities’, ‘Bills payable’, ‘Manager’s checks’, and financial liabilities
presented under ‘Accrued interest and other expenses’ and ‘Other liabilities’.

Reclassification of Financial Assets

The Group may reclassify, in rare circumstances, non-derivative financial assets out of the HFT investments category and into the AFS financial
assets, Loans and Receivables or HTM financial assets categories. The Group may also reclassify, in certain circumstances, financial instruments
out of the AFS financial assets to loans and receivables category. Reclassifications are recorded at fair value at the date of reclassification, which
becomes the new amortized cost.

The Group may reclassify a non-derivative trading asset out of HFT investments and into the Loans and Receivable category if it meets the
definition of loans and receivables, the Group has the intention and ability to hold the financial assets for the foreseeable future or until maturity
and only in rare circumstances. If a financial asset is reclassified, and if the Group subsequently increases its estimates of future cash receipts
as a result of increased recoverability of those cash receipts, the effect of that increase is recognized as an adjustment to the EIR from the date
of the change in estimate.

For a financial asset reclassified out of the AFS financial assets category, any previous gain or loss on that asset that has been recognized in
OCI is amortized to profit or loss over the remaining life of the investment using the effective interest method. Any difference between the new
amortized cost and the expected cash flows is also amortized over the remaining life of the asset using the effective interest method. If the
asset is subsequently determined to be impaired then the amount recorded in OCI is recycled to the statement of income. Reclassification
is at the election of management, and is determined on an instrument by instrument basis. The Group does not reclassify any financial
instrument into the FVPL category after initial recognition. An analysis of reclassified financial assets is disclosed in Note 8.

Derecognition of Financial Assets and Liabilities

Financial assets
A financial asset (or, where applicable a part of a financial asset or part of a group of financial assets) is derecognized when:

• the rights to receive cash flows from the asset have expired; or
• the Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay
to a third party under a “pass-through” arrangement; or
• the Group has transferred its rights to receive cash flows from the asset and either (a) has transferred substantially all the risks and rewards
of the asset, or (b) has neither transferred nor retained the risks and rewards of the asset but has transferred control of the asset.

Where the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, and has neither
transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognized to the
extent of the Group’s continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset
is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be
required to repay.

China Bank 114 Annual Report 2016

Financial liabilities
A financial liability is derecognized when the obligation under the liability is discharged, cancelled or has expired. Where an existing financial
liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified,
such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in
the respective carrying amounts is recognized in the statement of income.

Impairment of Financial Assets

The Group assesses at each reporting date whether there is objective evidence that a financial asset or group of financial assets is impaired. A
financial asset or a group of financial assets is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one
or more events that has occurred after the initial recognition of the asset (an incurred ‘loss event’) and that loss event (or events) has an impact
on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated. Evidence of impairment
may include indications that the borrower or a group of borrowers is experiencing significant financial difficulty, default or delinquency in interest
or principal payments, the probability that they will enter bankruptcy or other financial reorganization and where observable data indicate that
there is measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

Financial assets carried at amortized cost

For financial assets carried at amortized cost, the Group first assesses whether objective evidence of impairment exists individually for financial
assets that are individually significant, or collectively for financial assets that are not individually significant.

If there is objective evidence that an impairment loss has been incurred, the amount of the loss is measured as the difference between the
asset’s carrying amount and the present value of the estimated future cash flows (excluding future credit losses that have not been incurred).
The present value of the estimated future cash flows is discounted at the financial asset’s original EIR.

If a loan has a variable interest rate, the discount rate for measuring any impairment loss is the current EIR, adjusted for the original credit risk
premium. The calculation of the present value of the estimated future cash flows of a collateralized financial asset reflects the cash flows that
may result from foreclosure less costs for obtaining and selling the collateral, whether or not foreclosure is probable.

The carrying amount of the asset is reduced through use of an allowance account and the amount of loss is charged to the statement of income.
Interest income continues to be recognized based on the original EIR of the asset. The financial assets, together with the associated allowance
accounts, are written off when there is no realistic prospect of future recovery and all collateral has been realized.

If the Group determines that no objective evidence of impairment exists for individually assessed financial asset, whether significant or not,
it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses for impairment. Those
characteristics are relevant to the estimation of future cash flows for groups of such assets by being indicative of the debtors’ ability to pay all
amounts due according to the contractual terms of the assets being evaluated. Assets that are individually assessed for impairment and for
which an impairment loss is, or continues to be, recognized are not included in a collective assessment for impairment.

For the purpose of a collective evaluation of impairment, financial assets are grouped on the basis of such credit risk characteristics as industry,
collateral type, past-due status and term. Future cash flows in a group of financial assets that are collectively evaluated for impairment are
estimated on the basis of historical loss experience for assets with credit risk characteristics similar to those in the group. Historical loss
experience is adjusted on the basis of current observable data to reflect the effects of current conditions that did not affect the period on which
the historical loss experience is based and to remove the effects of conditions in the historical period that do not exist currently. Estimates of
changes in future cash flows reflect, and are directionally consistent with changes in related observable data from period to period (such as
changes in unemployment rates, property prices, commodity prices, payment status, or other factors that are indicative of incurred losses in
the Group and their magnitude). The methodology and assumptions used for estimating future cash flows are reviewed regularly by the Group
to reduce any differences between loss estimates and actual loss experience.

If, in a subsequent year, the amount of the estimated impairment loss decreases because of an event occurring after the impairment was
recognized, the previously recognized impairment loss is reduced by adjusting the allowance account. If a future write-off is later recovered, the
recovery is credited to ‘Miscellaneous income’.

Financial assets carried at cost

If there is objective evidence that an impairment loss on an unquoted equity instrument that is not carried at fair value because its fair value
cannot be reliably measured, or on a derivative asset that is linked to and must be settled by delivery of such an unquoted equity instrument
has been incurred, the amount of loss is measured as the difference between the asset’s carrying amount and the present value of estimated
future cash flows discounted at the current market rate of return for a similar financial asset.

Available-for-sale financial assets

For AFS financial assets, the Group assesses at each reporting date whether there is objective evidence that a financial asset or group of
financial assets is impaired.

In the case of equity investments classified as AFS financial assets, this would include a significant or prolonged decline in the fair value of the
investments below its cost. Where there is evidence of impairment, the cumulative loss - measured as the difference between the acquisition
cost and the current fair value, less any impairment loss on that financial asset previously recognized in the statement of income - is removed
from OCI and recognized in the statement of income. Impairment losses on equity investments are not reversed through the statement of
income. Increases in fair value after impairment are recognized directly in OCI.

China Bank 115 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

In the case of debt instruments classified as AFS financial assets, impairment is assessed based on the same criteria as financial assets carried
at amortized cost. However, the amount recorded for impairment is the cumulative loss measured as the difference between the amortized cost
and the current fair value, less any impairment loss on that investment previously recognized in profit or loss. Future interest income is based
on the reduced carrying amount and is accrued based on the rate of interest used to discount future cash flows for the purpose of measuring
impairment loss. Such accrual is recorded as part of ‘Interest income’ in the statement of income. If, in subsequent years, the fair value of a
debt instrument increased and the increase can be objectively related to an event occurring after the impairment loss was recognized in the
statement of income, the impairment loss is reversed through the statement of income.

Restructured loans
Where possible, the Group seeks to restructure loans rather than to take possession of collateral. This may involve extending the payment
arrangements and the agreement of new loan conditions. Once the terms have been renegotiated, the loan is no longer considered past due.
Management continuously reviews restructured loans to ensure that all criteria are met and that future payments are likely to occur. The loans
continue to be subject to an individual or collective impairment assessment, calculated using the loan’s original EIR. The difference between the
recorded value of the original loan and the present value of the restructured cash flows, discounted at the original EIR, is recognized in ‘Provision
for impairment and credit losses’ in the statement of income.

Investment in Associates
Associates pertain to all entities over which the Group has significant influence but not control, generally accompanying a shareholding of
between 20.00% and 50.00% of the voting rights. In the consolidated and parent company financial statements, investments in associates are
accounted for under the equity method of accounting.

Under the equity method, an investment in an associate is carried in the balance sheet at cost plus post-acquisition changes in the Group’s
share of the net assets of the associates. Goodwill, if any, relating to an associate is included in the carrying value of the investment and is not
amortized. The statement of income reflects the share of the results of operations of the associate. Where there has been a change recognized
directly in the equity of the associate, the Group recognizes its share of any changes and discloses this, when applicable, in the statement of
changes in equity.

When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables,
the Group does not recognize further losses, unless it has incurred obligations or made payments on behalf of the associate. Profits or losses
resulting from transactions between the Group and an associate are eliminated to the extent of the interest in the associate.

Dividends earned on this investment are recognized in the Parent Company’s statement of income as a reduction from the carrying value of
the investment.

The financial statements of the associate are prepared for the same reporting period as the Parent Company. Where necessary, adjustments
are made to bring the accounting policies in line with those of the Group.

Upon loss of significant influence over the associate, the Group measures and recognizes any retained investment at its fair value. Any
difference between the carrying amount of the associate upon loss of significant influence and the fair value of the retained investment and
proceeds from disposal is recognized in profit or loss.

Investment in Subsidiaries
In the parent company financial statements, investment in subsidiaries is accounted for under the equity method of accounting similar to the
investment in associates.

Business Combinations and Goodwill

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the
consideration transferred, measured at acquisition date fair value and the amount of any non-controlling interest in the acquiree. For each
business combination, the acquirer measures the non-controlling interest in the acquiree either at fair value or at the proportionate share of the
acquiree’ s identifiable net assets. Acquisition costs incurred are charged to profit or loss.

When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation
in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. This includes the
separation of embedded derivatives in host contracts by the acquiree.

If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity interest in the acquiree
is remeasured to fair value at the acquisition date through profit or loss.

Any contingent consideration to be transferred by the acquirer will be recognized at fair value at the acquisition date. Subsequent changes to
the fair value of the contingent consideration which is deemed to be an asset or liability, will be recognized in accordance with PAS 39, either
in profit or loss or as a charge to OCI. If the contingent consideration is classified as equity, it should not be remeasured until it is finally settled
within equity.

Goodwill is initially measured at cost being the excess of the aggregate of fair value of the consideration transferred and the amount recognized
for non-controlling interest over the net identifiable assets acquired and liabilities assumed. If this consideration is lower than the fair value of the
net assets of the subsidiary acquired, the difference is recognized in profit or loss.

China Bank 116 Annual Report 2016

After initial recognition, goodwill is measured at cost less any accumulated impairment losses.

Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate the carrying value may be impaired.
For the purpose of impairment testing, goodwill acquired in a business combination is, from the date of acquisition, allocated to each of the
Group’s CGUs, or groups of CGUs, that are expected to benefit from the synergies of the combination, irrespective of whether other assets or
liabilities of the acquiree are assigned to those units or group of units. Each unit or group of units to which the goodwill is allocated:

• represents the lowest level within the Group at which the goodwill is monitored for internal management purposes; and
• is not larger than an operating segment identified for segment reporting purposes.

Where goodwill forms part of a CGU (or group of CGUs) and part of the operation within that unit is disposed of, the goodwill associated with
the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation.
Goodwill disposed of in this circumstance is measured based on the relative values of the operation disposed of and the portion of the CGU
retained.

Cash Dividend and Non-cash Distribution to Equity Holders of the Parent

The Company recognizes a liability to make cash or non-cash distributions to equity holders of the parent when the distribution is authorized
and the distribution is no longer at the discretion of the Company. A corresponding amount is recognized directly in equity.

Non-cash distributions are measured at the fair value of the assets to be distributed with fair value remeasurement recognized directly in equity.

Upon distribution of non-cash assets, any difference between the carrying amount of the liability and the carrying amount of the assets
distributed is recognized in the statement of income.

Bank Premises, Furniture, Fixtures and Equipment

Land is stated at cost less any impairment in value while depreciable properties such as buildings, leasehold improvements, and furniture,
fixtures and equipment are stated at cost less accumulated depreciation and amortization, and any impairment in value. Such cost includes the
cost of replacing part of the bank premises, furniture, fixtures and equipment when that cost is incurred and if the recognition criteria are met,
but excluding repairs and maintenance costs.

Construction-in-progress is stated at cost less any impairment in value. The initial cost comprises its construction cost and any directly
attributable costs of bringing the asset to its working condition and location for its intended use, including borrowing costs. Construction-in-
progress is not depreciated until such time that the relevant assets are completed and put into operational use.

Depreciation and amortization is calculated using the straight-line method over the estimated useful life (EUL) of the depreciable assets as
follows:

EUL
Buildings 50 years
Furniture, fixtures and equipment 3 to 5 years
Leasehold improvements Shorter of 6 years or the related lease terms

The depreciation and amortization method and useful life are reviewed periodically to ensure that the method and period of depreciation and
amortization are consistent with the expected pattern of economic benefits from items of bank premises, furniture, fixtures and equipment and
leasehold improvements.

An item of bank premises, furniture, fixtures and equipment is derecognized upon disposal or when no future economic benefits are expected
from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds
and the carrying amount of the asset) is included in the statement of income in the year the asset is derecognized.

Investment Properties
Investment properties include real properties acquired in settlement of loans and receivables which are measured initially at cost, including
certain transaction costs. Investment properties acquired through a nonmonetary asset exchange is measured initially at fair value unless
(a) the exchange lacks commercial substance or (b) the fair value of neither the asset received nor the asset given up is reliably measurable.
The difference between the fair value of the investment property upon foreclosure and the carrying value of the loan is recognized under
‘Gain on asset foreclosure and dacion transactions’ in the statement of income. Subsequent to initial recognition, depreciable investment
properties are stated at cost less accumulated depreciation and any accumulated impairment in value except for land which is stated at cost
less impairment in value.

Expenditures incurred after the investment properties have been put into operation, such as repairs and maintenance costs, are normally
charged to income in the period in which the costs are incurred.

China Bank 117 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Depreciation is calculated on a straight-line basis using the remaining EUL of the building and improvement components of investment properties
which ranged from 10 to 33 years from the time of acquisition of the investment properties.

Investment properties are derecognized when they have either been disposed of or when the investment properties are permanently withdrawn
from use and no future benefit is expected from their disposal. Any gains or losses on the derecognition of an investment property are
recognized as ‘Gain on sale of investment properties’ in the statement of income in the year of derecognition.

Transfers are made to investment properties when, and only when, there is a change in use evidenced by ending of owner occupation,
commencement of an operating lease to another party or ending of construction or development. Transfers are made from investment properties
when, and only when, there is a change in use evidenced by commencement of owner occupation or commencement of development with a
view to sale.

Intangible Assets
Intangible assets include software cost and branch licenses resulting from the Parent Company’s acquisition of CBSI, Unity Bank and PDB
(Notes 10 and 13).

Software costs
Costs related to software purchased by the Group for use in operations are amortized on a straight-line basis over 3 to 10 years. The
amortization method and useful life are reviewed periodically to ensure that the method and period of amortization are consistent with the
expected pattern of economic benefits embodied in the asset.

Branch licenses
The branch licenses are initially measured at fair value as of the date of acquisition and are deemed to have an indefinite useful life as there is
no foreseeable limit to the period over which they are expected to generate net cash inflows for the Group.

Such intangible assets are not amortized, instead they are tested for impairment annually either individually or at the CGU level. Impairment is
determined by assessing the recoverable amount of each CGU (or group of CGUs) to which the intangible asset relates. Recoverable amount
is the higher of the CGU’s fair value less costs to sell and its value in use. Where the recoverable amount of the CGU is less than its carrying
amount, an impairment loss is recognized.

Gains and losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognized in earnings when the asset is derecognized.

Impairment of Nonfinancial Assets

At each reporting date, the Group assesses whether there is any indication that its nonfinancial assets (e.g., investment in associates, investment
properties, bank premises, furniture, fixtures and equipment, goodwill and intangible assets) may be impaired. When an indicator of impairment
exists or when an annual impairment testing for an asset is required, the Group makes a formal estimate of recoverable amount.

Recoverable amount is the higher of an asset’s (or CGU’s) fair value less costs to sell and its value in use and is determined for an individual
asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets, in which
case the recoverable amount is assessed as part of the CGU to which it belongs. Where the carrying amount of an asset (or CGU) exceeds its
recoverable amount, the asset (or CGU) is considered impaired and is written down to its recoverable amount. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset (or CGU).

An impairment loss is charged to operations in the year in which it arises.

For nonfinancial assets, excluding goodwill and branch licenses, an assessment is made at each reporting date as to whether there is
any indication that previously recognized impairment losses may no longer exist or may have decreased. If such indication exists, the
recoverable amount is estimated. A previously recognized impairment loss is reversed, except for goodwill, only if there has been a change
in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized. If that is the case, the
carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been
determined, net of depreciation, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the statement of
income. After such a reversal, the depreciation expense is adjusted in future years to allocate the asset’s revised carrying amount, less any residual value,
on a systematic basis over its remaining life.

Leases
The determination of whether an arrangement is, or contains a lease is based on the substance of the arrangement and requires an assessment
of whether the fulfillment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use
the asset. A reassessment is made after inception of the lease only if one of the following applies:

(a) there is a change in contractual terms, other than a renewal or extension of the arrangement; or
(b) a renewal option is exercised or extension granted, unless that term of the renewal or extension was initially included in the lease term; or
(c) there is a change in the determination of whether fulfillment is dependent on a specified asset; or
(d) there is a substantial change to the asset.

China Bank 118 Annual Report 2016

Where a reassessment is made, lease accounting shall commence or cease from the date when the change in circumstances gave rise to the
reassessment for scenarios (a), (c), or (d) above, and at the date of renewal or extension period for scenario (b).

Group as a lessee
Leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases. Operating
lease payments are recognized as an expense in the statement of income on a straight-line basis over the lease term and included in ‘Occupancy
cost’ in the statement of income.

Group as a lessor
Leases where the Group does not transfer substantially all the risks and benefits of ownership of the assets are classified as operating leases.
Initial direct costs incurred in negotiating operating leases are added to the carrying amount of the leased asset and recognized over the lease
term on the same basis as the rental income. Contingent rents are recognized as revenue in the period in which they are earned.

Capital Stock
Capital stocks are recorded at par. Proceeds in excess of par value are recognized under equity as ‘Capital paid in excess of par value’ in the
balance sheet. Incremental costs incurred which are directly attributable to the issuance of new shares are shown in equity as a deduction
from proceeds, net of tax.

Revenue Recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably
measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable,
taking into account contractually defined terms of payment and excluding taxes or duty. The Group assesses its revenue arrangements against
specific criteria in order to determine if it is acting as principal or agent. The Group has concluded that it is acting as a principal in all of its
revenue arrangements.

The following specific recognition criteria must also be met before revenue is recognized:

Interest income
For all financial instruments measured at amortized cost and interest-bearing financial instruments classified as FVPL and AFS financial assets,
interest income is recorded at EIR, which is the rate that exactly discounts estimated future cash payments or receipts through the expected
life of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the financial asset or financial liability.
The calculation takes into account all contractual terms of the financial instrument (for example, prepayment options), includes any fees or
incremental costs that are directly attributable to the instrument and are an integral part of the EIR, as applicable, but not future credit losses.
The adjusted carrying amount is calculated based on the original EIR. The change in carrying amount is recorded as ‘Interest income’.

Once the recorded value of a financial asset or group of similar financial assets has been reduced due to an impairment loss, interest income
continues to be recognized using the original EIR applied to the new carrying amount.

Fee and commission income

The Group earns fee and commission income from a diverse range of services it provides to its customers. Fee income can be divided into
the following two categories:

a. Fee income earned from services that are provided over a certain period of time
Fees earned for the provision of services over a period of time that are accrued over that period. These fees include investment fund fees,
custodian fees, fiduciary fees, commission income, credit related fees, asset management fees, portfolio and other management fees,
and advisory fees. Loan commitment fees for loans that are likely to be drawn down are deferred (together with any incremental costs)
and recognized as an adjustment to the EIR on the loan. If the commitment expires without the Group making the loan, the commitment
fees are recognized as other income on expiry.

b. Fee income from providing transactions services

Fees arising from negotiating or participating in the negotiation of a transaction for a third party - such as underwriting fees, corporate
finance fees and brokerage fees for the arrangement of the acquisition of shares or other securities or the purchase or sale of businesses
- are recognized on completion of the underlying transaction. Fees or components of fees that are linked to a certain performance are
recognized after fulfilling the corresponding criteria. Loan syndication fees are recognized in the statement of income when the syndication
has been completed and the Group retains no part of the loans for itself or retains part at the same EIR as for the other participants.

Service charges and penalties

Service charges and penalties are recognized only upon collection or accrued where there is a reasonable degree of certainty as to their
collectability.

Dividend income
Dividend income is recognized when the Group’s right to receive payment is established.

China Bank 119 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Trading and securities gain

This represents results arising from trading activities including all gains and losses from changes in fair value of financial assets held for trading
and designated at FVPL. It also includes gains and losses realized from sale of AFS financial assets.

Other income
Income from sale of service is recognized upon rendition of the service. Income from sale of properties is recognized upon completion of the
earning process and when the collectability of the sales price is reasonably assured.

Expense Recognition
Expense is recognized when it is probable that a decrease in future economic benefits related to a decrease in an asset or an increase in liability
has occurred and the decrease in economic benefits can be measured reliably. Revenues and expenses that relate to the same transaction or
other event are recognized simultaneously.

Interest expense
Interest expense for all interest-bearing financial liabilities are recognized in ‘Interest expense’ in the statement of income using the EIR of the
financial liabilities to which they relate.

Other expenses
Expenses encompass losses as well as those expenses that arise in the ordinary course of business of the Group. Expenses are recognized
when incurred.

Retirement Benefits
Defined benefit plan
The net defined benefit liability or asset is the aggregate of the present value of the defined benefit obligation at the end of the reporting
period reduced by the fair value of plan assets and adjusted for any effect of limiting a net defined benefit asset to the asset ceiling. The
defined benefit obligation is calculated annually by an independent actuary. The present value of the defined benefit obligation is determined
by discounting the estimated future cash outflows using interest rates on government bonds that have terms to maturity approximating the
terms of the related retirement liability. The asset ceiling is the present value of any economic benefits available in the form of refunds from
the plan or reductions in future contributions to the plan.

The cost of providing benefits under the defined benefit plans is actuarially determined using the projected unit credit method.

Defined benefit costs comprise the following:

(a) service cost;
(b) net interest on the net defined benefit liability or asset; and
(c) remeasurements of net defined benefit liability or asset.

Service costs which include current service costs, past service costs and gains or losses on non-routine settlements are recognized as expense
in profit or loss. Past service costs are recognized when plan amendment or curtailment occurs.

Net interest on the net defined benefit liability or asset is the change during the period in the net defined benefit liability or asset that arises from
the passage of time which is determined by applying the discount rate based on Philippine government bonds to the net defined benefit liability
or asset. Net interest on the net defined benefit liability or asset is recognized as expense or income in profit or loss.

Remeasurements comprising actuarial gains and losses, return on plan assets and any change in the effect of the asset ceiling (excluding net
interest on defined benefit liability) are recognized immediately in OCI in the period in which they arise. Remeasurements are not reclassified to
profit or loss in subsequent periods.

Plan assets are assets that are held by a long-term employee benefit fund or qualifying insurance policies. Plan assets are not available to the
creditors of the Parent Company, nor can they be paid directly to the Parent Company. The fair value of plan assets is based on market price
information. When no market price is available, the fair value of plan assets is estimated by discounting expected future cash flows using a
discount rate that reflects both the risk associated with the plan assets and the maturity or expected disposal date of those assets (or, if they
have no maturity, the expected period until the settlement of the related obligations).

The Parent Company’s right to be reimbursed of some or all of the expenditure required to settle a defined benefit obligation is recognized as a
separate asset at fair value when and only when reimbursement is virtually certain. If the fair value of the plan assets is higher than the present
value of the defined benefit obligation, the measurement of the resulting defined benefit asset is limited to the present value of economic benefits
available in the form of refunds from the plan or reductions in future contributions to the plan.

Employee leave entitlement

Employee entitlements to annual leave are recognized as a liability when they are accrued to the employees. The undiscounted liability for
leave expected to be settled after the end of the annual reporting period is recognized for services rendered by employees up to the end of the
reporting period.

China Bank 120 Annual Report 2016

Provisions and Contingencies
Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event and it is probable that
an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the
amount of the obligation. Where the Group expects some or all of a provision to be reimbursed, for example, under an insurance contract, the
reimbursement is recognized as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is
presented in the statement of income, net of any reimbursement. If the effect of the time value of money is material, provisions are determined
by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where
appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized
as an interest expense.

Contingent liabilities are not recognized in the financial statements but are disclosed unless the possibility of an outflow of resources embodying
economic benefits is remote. Contingent assets are not recognized but are disclosed in the financial statements when an inflow of economic
benefits is probable.

Income Taxes
Current tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the
taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted as of the
reporting date.

Deferred tax
Deferred tax is provided, using the balance sheet liability method, on all temporary differences at the reporting date between the tax bases of
assets and liabilities and their carrying amounts for financial reporting purposes.

Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized for all deductible temporary
differences, carry forward of unused tax credits from the excess of minimum corporate income tax (MCIT) over the regular corporate income tax
(RCIT), and unused net operating loss carryover (NOLCO), to the extent that it is probable that sufficient taxable profit will be available against
which the deductible temporary differences and carry forward of unused tax credits from MCIT and unused NOLCO can be utilized. Deferred
tax, however, is not recognized on temporary differences that arise from the initial recognition of an asset or liability in a transaction that is not a
business combination and, at the time of the transaction, affects neither the accounting income nor taxable income.

Deferred tax liabilities are not provided on non-taxable temporary differences associated with investments in domestic subsidiaries and
associates.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that
sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are
reassessed at each reporting date and are recognized to the extent that it has become probable that future taxable profit will allow the deferred
tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are applicable to the period when the asset is realized or the liability is
settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Current tax and deferred tax relating to items recognized directly in equity is also recognized in equity and not in the statement of income.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current tax
liabilities and deferred taxes relate to the same taxable entity and the same taxation authority.

Earnings per Share

Basic earnings per share (EPS) is computed by dividing net income for the year by the weighted average number of common shares outstanding
during the year after giving retroactive effect to stock splits, stock dividends declared and stock rights exercised during the year, if any.

The Parent Company has no outstanding dilutive potential common shares.

Dividends on Common Shares

Dividends on common shares are recognized as a liability and deducted from equity when approved by the respective shareholders of the
Parent Company and its subsidiaries. Dividends declared during the year that are approved after the reporting date are dealt with as an event
after the reporting date.

Segment Reporting
The Group’s operating businesses are organized and managed separately according to the nature of the products and services provided,
with each segment representing a strategic business unit that offers different products and serves different markets. Financial information
on business segments is presented in Note 30. The Group’s revenue producing assets are located in the Philippines (i.e., one geographical
location). Therefore, geographical segment information is no longer presented.

China Bank 121 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Fiduciary Activities
Assets and income arising from fiduciary activities together with related undertakings to return such assets to customers are excluded from the
financial statements where the Parent Company acts in a fiduciary capacity such as nominee, trustee or agent.

Events after the Reporting Period

Any post year-end events that provide additional information about the Group’s position at the reporting date (adjusting event) are reflected in the
Group’s financial statements. Post year-end events that are not adjusting events, if any, are disclosed when material to the financial statements.

Standards Issued but Not Yet Effective

Effective beginning on or after January 1, 2017

Amendment to PFRS 12, Clarification of the Scope of the Standard (Part of Annual Improvements to PFRSs 2014 - 2016 Cycle)

The amendments clarify that the disclosure requirements in PFRS 12, other than those relating to summarized financial information, apply to an
entity’s interest in a subsidiary, a joint venture or an associate (or a portion of its interest in a joint venture or an associate) that is classified (or
included in a disposal group that is classified) as held for sale.

Amendments to PAS 7, Statement of Cash Flows, Disclosure Initiative

The amendments to PAS 7 require an entity to provide disclosures that enable users of financial statements to evaluate changes in liabilities
arising from financing activities, including both changes arising from cash flows and non-cash changes (such as foreign exchange gains or
losses). On initial application of the amendments, entities are not required to provide comparative information for preceding periods. Early
application of the amendments is permitted.

Application of amendments will result in additional disclosures in the 2017 financial statements of the Group and the Parent Company.

Amendments to PAS 12, Income Taxes, Recognition of Deferred Tax Assets for Unrealized Losses
The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make
deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how an entity should
determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than
their carrying amount.

Entities are required to apply the amendments retrospectively. However, on initial application of the amendments, the change in the opening
equity of the earliest comparative period may be recognized in opening retained earnings (or in another component of equity, as appropriate),
without allocating the change between opening retained earnings and other components of equity. Entities applying this relief must disclose that
fact. Early application of the amendments is permitted.

These amendments are not expected to have any impact on the Group.

Effective beginning on or after January 1, 2018

Amendments to PFRS 2, Share-based Payment, Classification and Measurement of Share-based Payment Transactions
The amendments to PFRS 2 address three main areas: the effects of vesting conditions on the measurement of a cash-settled share-based
payment transaction; the classification of a share-based payment transaction with net settlement features for withholding tax obligations; and
the accounting where a modification to the terms and conditions of a share-based payment transaction changes its classification from cash
settled to equity settled.

On adoption, entities are required to apply the amendments without restating prior periods, but retrospective application is permitted if elected
for all three amendments and if other criteria are met. Early application of the amendments is permitted.

The above amendments have no impact on the Group’s financial statements.

Amendments to PFRS 4, Insurance Contracts, Applying PFRS 9, Financial Instruments, with PFRS 4
The amendments address concerns arising from implementing PFRS 9, the new financial instruments standard before implementing the
forthcoming insurance contracts standard. They allow entities to choose between the overlay approach and the deferral approach to deal with
the transitional challenges. The overlay approach gives all entities that issue insurance contracts the option to recognize in other comprehensive
income, rather than profit or loss, the volatility that could arise when PFRS 9 is applied before the new insurance contracts standard is issued.
On the other hand, the deferral approach gives entities whose activities are predominantly connected with insurance an optional temporary
exemption from applying PFRS 9 until the earlier of application of the forthcoming insurance contracts standard or January 1, 2021.

These amendments are not expected to have any impact on the Group.

China Bank 122 Annual Report 2016

PFRS 9, Financial Instruments
PFRS 9 reflects all phases of the financial instruments project and replaces PAS 39, Financial Instruments: Recognition and Measurement,
and all previous versions of PFRS 9. The standard introduces new requirements for classification and measurement, impairment, and hedge
accounting. PFRS 9 is effective for annual periods beginning on or after January 1, 2018, with early application permitted. Retrospective
application is required, but providing comparative information is not compulsory. For hedge accounting, the requirements are generally applied
prospectively, with some limited exceptions.

The adoption of PFRS 9 will have an effect on the classification and measurement of the Group’s financial assets and impairment methodology
for financial assets, but will have no impact on the classification and measurement of the Group’s financial liabilities and application of hedge
accounting. The adoption will also have an effect on the amount of its credit losses.

The Group is currently assessing the impact of adopting this standard.

PFRS 15, Revenue from Contracts with Customers

PFRS 15 establishes a new five-step model that will apply to revenue arising from contracts with customers. Under PFRS 15, revenue is
recognized at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services
to a customer. The principles in PFRS 15 provide a more structured approach to measuring and recognizing revenue.

The new revenue standard is applicable to all entities and will supersede all current revenue recognition requirements under PFRSs. Either a full
or modified retrospective application is required for annual periods beginning on or after January 1, 2018.

The Group is currently assessing the impact of adopting this standard.

Amendments to PAS 28, Measuring an Associate or Joint Venture at Fair Value (Part of Annual Improvements to PFRSs 2014 - 2016 Cycle)
The amendments clarify that an entity that is a venture capital organization, or other qualifying entity, may elect, at initial recognition on an
investment-by-investment basis, to measure its investments in associates and joint ventures at fair value through profit or loss. They also clarify
that if an entity that is not itself an investment entity has an interest in an associate or joint venture that is an investment entity, the entity may,
when applying the equity method, elect to retain the fair value measurement applied by that investment entity associate or joint venture to the
investment entity associate’s or joint venture’s interests in subsidiaries. This election is made separately for each investment entity associate or
joint venture, at the later of the date on which (a) the investment entity associate or joint venture is initially recognized; (b) the associate or joint
venture becomes an investment entity; and (c) the investment entity associate or joint venture first becomes a parent. The amendments should
be applied retrospectively, with earlier application permitted.

The Group is currently assessing the impact of adopting this standard.

Amendments to PAS 40, Investment Property, Transfers of Investment Property

The amendments clarify when an entity should transfer property, including property under construction or development into, or out of investment
property. The amendments state that a change in use occurs when the property meets, or ceases to meet, the definition of investment property
and there is evidence of the change in use. A mere change in management’s intentions for the use of a property does not provide evidence of a
change in use. The amendments should be applied prospectively to changes in use that occur on or after the beginning of the annual reporting
period in which the entity first applies the amendments. Retrospective application is only permitted if this is possible without the use of hindsight.

The Group is currently assessing the impact of adopting this standard.

Philippine Interpretation IFRIC-22, Foreign Currency Transactions and Advance Consideration

The interpretation clarifies that in determining the spot exchange rate to use on initial recognition of the related asset, expense or income (or
part of it) on the derecognition of a non-monetary asset or non-monetary liability relating to advance consideration, the date of the transaction is
the date on which an entity initially recognizes the nonmonetary asset or non-monetary liability arising from the advance consideration. If there
are multiple payments or receipts in advance, then the entity must determine a date of the transactions for each payment or receipt of advance
consideration. The interpretation may be applied on a fully retrospective basis. Entities may apply the interpretation prospectively to all assets,
expenses and income in its scope that are initially recognized on or after the beginning of the reporting period in which the entity first applies
the interpretation or the beginning of a prior reporting period presented as comparative information in the financial statements of the reporting
period in which the entity first applies the interpretation.

Effective beginning on or after January 1, 2019

PFRS 16, Leases
Under the new standard, lessees will no longer classify their leases as either operating or finance leases in accordance with PAS 17, Leases.
Rather, lessees will apply the single-asset model. Under this model, lessees will recognize the assets and related liabilities for most leases on
their balance sheets, and subsequently, will depreciate the lease assets and recognize interest on the lease liabilities in their profit or loss. Leases
with a term of 12 months or less or for which the underlying asset is of low value are exempted from these requirements.

China Bank 123 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

The accounting by lessors is substantially unchanged as the new standard carries forward the principles of lessor accounting under PAS 17.
Lessors, however, will be required to disclose more information in their financial statements, particularly on the risk exposure to residual value.
Entities may early adopt PFRS 16 but only if they have also adopted PFRS 15. When adopting PFRS 16, an entity is permitted to use either a
full retrospective or a modified retrospective approach, with options to use certain transition reliefs.

The Group is currently assessing the impact of adopting this standard.

3. SIGNIFICANT ACCOUNTING JUDGMENTS AND ESTIMATES

The preparation of the financial statements in accordance with PFRS requires the Group to make judgments and estimates that affect the
reported amounts of assets, liabilities, income and expenses and disclosure of contingent assets and contingent liabilities at reporting date.
Future events may occur which will cause the judgments and assumptions used in arriving at the estimates to change. The effects of any
change in judgments and estimates are reflected in the financial statements as they become reasonably determinable.

Judgments and estimates are continually evaluated and are based on historical experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances.

Judgments
a. Fair value of financial instruments
The Group classifies financial assets by evaluating, among others, whether the asset is quoted or not in an active market. Included in the
evaluation on whether a financial asset is quoted in an active market is the determination of whether quoted prices are readily and regularly
available, and whether those prices represent actual and regularly occurring market transactions conducted on an arm’s length basis.

Where the fair values of financial assets and financial liabilities recorded on the balance sheet or disclosed in the notes cannot be
derived from active markets, they are determined using a variety of valuation techniques acceptable to the market as alternative valuation
approaches that include the use of mathematical models. All financial models are certified before they are used and are calibrated to
ensure that outputs reflect actual data and comparative market prices. To the extent practical, the financial models use only observable
data, however, areas such as credit risk (both own and counterparty), volatilities and correlations require management to make estimates.
Changes in assumptions about these factors could affect reported fair value of financial instruments (Note 5).

b. HTM financial assets

The classification to HTM financial assets requires significant judgment. In making this judgment, the Group evaluates its intention
and ability to hold such investments to maturity. If the Group fails to keep these investments to maturity other than in certain specific
circumstances – for example, selling an insignificant amount close to maturity – it will be required to reclassify the entire portfolio as part of
AFS financial assets. The investments would therefore be measured at fair value and not at amortized cost.

Details of AFS financial assets reclassified in HTM are disclosed in Note 8.

c. Contingencies
The Group is currently involved in various legal proceedings. The estimate of the probable costs for the resolution of these claims has been
developed in consultation with outside counsel handling the Group’s defense in these matters and is based upon an analysis of potential
results. The Group currently does not believe that these proceedings will have a material adverse effect on the financial statements. It is
possible, however, that future results of operations could be materially affected by changes in the estimates or in the effectiveness of the
strategies relating to these proceedings.

Estimates
a. Credit losses on loans and receivables
The Group reviews its loans and receivables at each reporting date to assess whether an allowance for credit losses should be recorded
in the balance sheet and any changes thereto in the statement of income. In particular, judgment by management is required in the
estimation of the amount and timing of future cash flows when determining the level of allowance required. Such estimates are based on
assumptions about a number of factors. Actual results may also differ, resulting in future changes to the allowance.

In addition to specific allowance against individually significant loans and receivables, the Group also makes a collective impairment
assessment on exposures which, although not specifically identified as requiring a specific allowance, have a greater risk of default than
when originally granted. The resulting collective allowance is based on any deterioration in the internal rating of the loan or investment
since it was granted or acquired.

The carrying values of loans and receivables and the related allowance for credit losses of the Group and the Parent Company are
disclosed in Notes 9 and 15.

b. Impairment of HTM and AFS debt investments

The Group determines that AFS debt investments are impaired based on the same criteria as loans and receivables.

China Bank 124 Annual Report 2016

 As of December 31, 2016 and 2015, HTM and AFS debt investments were unimpaired. The carrying values of HTM and AFS debt
investments are disclosed in Note 8.

c. Impairment on investments in subsidiaries and associates and other nonfinancial assets

The Parent Company assesses impairment on its investments in subsidiaries and associate whenever events or changes in circumstances
indicate that the carrying amount of the asset may not be recoverable. Among others, the factors that the Parent Company considers
important which could trigger an impairment review on its investments in subsidiaries and associate include the following:

• deteriorating or poor financial condition;

• recurring net losses; and
• significant changes on the technological, market, economic, or legal environment which had an adverse effect on the subsidiary or
associate during the period or in the near future, in which the subsidiary operates.

The Group also assesses impairment on its nonfinancial assets (e.g., investment properties and bank premises, furniture, fixtures and
equipment) and considers the following impairment indicators:

• significant underperformance relative to expected historical or projected future operating results;

• significant changes in the manner of use of the acquired assets or the strategy for overall business; and
• significant negative industry or economic trends.

An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Except for investment
properties where recoverable amount is determined based on fair value less cost to sell, the recoverable amount of all other nonfinancial
assets is determined based on the asset’s value in use computation which considers the present value of estimated future cash flows
expected to be generated from the continued use of the asset. The Group is required to make estimates and assumptions that can
materially affect the carrying amount of the asset being assessed.

The carrying values of the Group’s investments in subsidiaries and associate and other nonfinancial assets are disclosed in Notes 10, 11
and 12, respectively.

d. Impairment of goodwill and branch licenses

The Group conducts an annual review for any impairment in the value of goodwill and branch licenses. Goodwill and branch licenses are
written down for impairment where the recoverable value is insufficient to support the carrying value. The recoverable amount of goodwill
and branch licenses is the higher between fair value less costs of disposal (FVLCD) and its value-in-use (VIU). FVLCD of branch licenses is
based on the special licensing fee of BSP on branches operating on identified restricted areas. For VIU, the Group estimates the discount
rate used for the computation of the net present value by reference to industry cost of capital. Future cash flows from the business are
estimated based on the theoretical annual income of the CGUs. Average growth rate is derived from the average increase in annual
income of the CGUs during the last 5 years. The recoverable amount of the CGU is determined based on a VIU calculation using cash
flow projections from financial budgets approved by senior management covering a five-year period. Key assumptions in VIU calculation
of CGUs are most sensitive to discount rates and growth rates used to project cash flows.

The carrying values of the Group’s goodwill and branch licenses are disclosed in Note 13.

e. Net plan assets and retirement expense

The determination of the Group’s net plan assets and annual retirement expense is dependent on the selection of certain assumptions
used in calculating such amounts. These assumptions include, among others, discount rates and salary rates.

The assumed discount rates were determined using the market yields on Philippine government bonds with terms consistent with the
expected employee benefit payout as of the reporting date. Refer to Note 23 for the details on the assumptions used in the calculation.

The present value of the retirement obligation and fair value of plan assets are disclosed in Note 23.

f. Recognition of deferred income taxes

Deferred tax assets are recognized for all unused tax losses to the extent that it is probable that taxable profit will be available against which
the losses can be utilized. Management discretion is required to determine the amount of deferred tax assets that can be recognized,
based on the forecasted level of future taxable profits and the related future tax planning strategies.

The Group believes it will be able to generate sufficient taxable income in the future to utilize its recorded deferred tax assets. Taxable
income is sourced mainly from interest income from lending activities and earnings from service charge, fees, commissions and trust
activities.

The recognized and unrecognized deferred tax assets are disclosed in Note 26.

China Bank 125 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

4. FINANCIAL INSTRUMENT CATEGORIES

The following table presents the total carrying amount of the Group’s and the Parent Company’s financial instruments per category:

Consolidated Parent Company

2016 2015 2016 2015
Financial assets
Cash and other cash items P12,010,543 P11,377,101 P10,580,748 P10,052,891
Financial assets at FVPL 7,703,899 6,244,593 7,232,882 5,465,417
AFS financial assets 33,873,723 48,829,233 31,153,750 46,834,199
HTM financial assets 57,404,800 16,136,147 54,069,021 13,945,645
Loans and receivables:
Due from BSP 91,964,495 86,318,501 85,307,128 77,003,616
Due from other banks 11,332,236 21,243,492 9,689,165 19,200,544
Interbank loans receivables 3,451,543 – 2,958,465 –
Loans and receivables 386,827,300 309,761,777 329,069,859 259,645,008
Accrued interest receivable 3,014,529 2,621,737 2,666,353 2,201,247
Other assets 4,933,768 4,235,672 2,990,134 2,693,764
501,523,871 424,181,179 432,681,104 360,744,179
Total financial assets P612,516,836 P506,768,253 P535,717,505 P437,042,331
*Other assets include accounts receivables, sales contract receivable, returned checks and other cash items and miscellaneous financial assets
(Note 14).

Consolidated Parent Company

2016 2015 2016 2015
Financial liabilities
Other financial liabilities:
Deposit liabilities P541,583,018 P439,265,686 P470,961,991 P373,603,416
Bills payable 16,954,998 19,085,180 16,954,998 18,422,650
Manager’s checks 2,029,778 1,456,498 1,445,585 741,479
Accrued interest and other expenses* 870,204 670,265 577,550 355,436
Other liabilities** 5,238,408 4,404,342 4,089,817 3,337,858
566,676,406 464,881,971 494,029,941 396,460,839
Financial liabilities at FVPL:
Derivative liabilities 243,198 66,373 243,198 66,373
Total financial liabilities P566,919,604 P464,948,344 P494,273,139 P396,527,212
*Accrued interest and other expenses exclude accrued payable for employee benefits, accrued lease payable and accrued taxes and other
licenses (Note 18).
**Other liabilities exclude withholding taxes payable and retirement liabilities (Note 19).

5. FAIR VALUE MEASUREMENT

The Group has assets and liabilities in the consolidated and Parent Company balance sheets that are measured at fair value on a recurring
and non-recurring basis after initial recognition. Recurring fair value measurements are those that another PFRS requires or permits to be
recognized in the consolidated balance sheet at the end of each financial reporting period. These include financial assets and liabilities at FVPL
and AFS financial assets. Non-recurring fair value measurements are those that another PFRS requires or permits to be recognized in the
consolidated balance sheet in particular circumstances. For example, PFRS 5 requires an entity to measure an asset held for sale at the lower
of its carrying amount and fair value less costs to sell. Since the asset’s fair value less costs to sell is only recognized in the balance sheet when
it is lower than its carrying amount, that fair value measurement is non-recurring.

As of December 31, 2016 and 2015, except for the following financial instruments, the carrying values of the Group’s financial assets and
liabilities as reflected in the balance sheets and related notes approximate their respective fair values:

China Bank 126 Annual Report 2016

 Consolidated
2016 2015
Carrying Value Fair Value Carrying Value Fair Value
Financial Assets
HTM financial assets (Note 8)
Government bonds P42,638,409 P40,492,328 P13,162,777 P14,273,659
Private bonds 14,766,391 14,581,086 2,973,370 3,324,907
Loans and receivables (Note 9)
Corporate and commercial loans 315,140,091 294,494,449 250,661,528 255,872,291
Consumer loans 58,528,805 53,251,627 46,421,426 53,331,599
Trade-related loans 12,767,908 12,945,460 12,360,222 13,564,618
Others 390,496 309,048 318,601 293,602
Sales contracts receivable (Note 14) 893,084 876,406 967,329 974,123

Financial Liabilities
Deposit liabilities 541,583,018 534,102,368 439,265,686 429,639,806
Bills payable 16,954,998 16,409,581 19,085,180 18,993,875

Parent Company
2016 2015
Carrying Value Fair Value Carrying Value Fair Value
Financial Assets
HTM financial assets (Note 8)
Government bonds P39,952,630 P37,832,994 P11,422,275 P12,532,769
Private bonds 14,116,391 13,939,793 2,523,370 2,877,180
Loans and receivables (Note 9)
Corporate and commercial loans 283,740,901 264,258,587 220,451,670 223,257,420
Consumer loans 34,149,927 29,357,086 28,364,417 30,991,571
Trade-related loans 11,110,851 11,289,013 10,757,421 11,559,856
Others 68,180 79,805 71,500 74,319
Sales contracts receivable (Note 14) 224,149 267,688 257,473 264,268

Financial Liabilities
Deposit liabilities 470,961,992 462,544,056 373,603,416 363,221,514
Bills payable 16,954,998 16,409,581 18,422,650 18,330,913

The methods and assumptions used by the Group and Parent Company in estimating the fair values of the financial instruments follow:

Cash and other cash items, due from BSP and other banks, interbank loans receivables and accrued interest receivable - The carrying amounts
approximate their fair values in view of the relatively short-term maturities of these instruments.

Debt securities - Fair values are generally based on quoted market prices. If the market prices are not readily available, fair values are estimated
using either values obtained from independent parties offering pricing services or adjusted quoted market prices of comparable investments or
using the discounted cash flow methodology.

Equity securities - For publicly traded equity securities, fair values are based on quoted prices. For unquoted equity securities for which no
reliable basis for fair value measurement is available, these are carried at cost net of impairment, if any.

Loans and receivables and sales contracts receivable (SCR) included in other assets - Fair values of loans and receivables and SCR are
estimated using the discounted cash flow methodology, where future cash flows are discounted using the Group’s current incremental lending
rates for similar types of loans and receivables.

Accounts receivable, returned checks and other cash items (RCOCI) and other financial assets included in other assets - Quoted market prices
are not readily available for these assets. These are reported at cost and are not significant in relation to the Group’s total portfolio of securities.

China Bank 127 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Derivative instruments (included under FVPL) - Fair values are estimated based on quoted market prices provided by independent parties or
accepted valuation models (either based on discounted cash flow techniques or option pricing models, as applicable).

Deposit liabilities (time, demand and savings deposits) - Fair values of time deposits are estimated using the discounted cash flow methodology,
where future cash flows are discounted using the Group’s current incremental borrowing rates for similar borrowings and with maturities
consistent with those remaining for the liability being valued. For demand and savings deposits, carrying amounts approximate fair values
considering that these are currently due and demandable.

Bills payable - Fair values are estimated using the discounted cash flow methodology, where future cash flows are discounted using the current
incremental borrowing rates for similar borrowings and with maturities consistent with those remaining for the liability being valued.

Manager’s checks and accrued interest and other expenses - Carrying amounts approximate fair values due to the short-term nature of the
accounts.

Other liabilities - Quoted market prices are not readily available for these liabilities. These are reported at cost and are not significant in relation
to the Group’s total portfolio.

Fair Value Hierarchy

The Group uses the following hierarchy for determining and disclosing the fair value of assets and liabilities by valuation technique:

Level 1: quoted prices in active markets for identical assets or liabilities;

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly
(derived from prices); and
Level 3: inputs that are not based on observable market data or unobservable inputs.

As of December 31, 2016 and 2015, the fair value hierarchy of the Group’s and the Parent Company’s assets and liabilities are presented below:

Consolidated
2016
Level 1 Level 2 Level 3 Total
Recurring fair value measurements(a)
Financial assets at FVPL
Held-for-trading
Government bonds P2,322,038 P82,011 P– P2,404,049
Treasury notes 307,455 724,220 – 1,031,675
Treasury bills − 994,203 – 994,203
Private bonds 594,798 − – 594,798
Financial assets designated at FVPL 2,462,886 − – 2,462,886
Derivative assets − 216,288 – 216,288
AFS financial assets
Government bonds 21,822,016 − – 21,822,016
Quoted private bonds 4,735,050 6,682,562 – 11,417,612
Quoted equity shares 80,947 − – 80,947
P32,325,190 P8,699,284 P– P41,540,049
Financial liabilities at FVPL
Derivative liabilities − 243,198 − 243,198
P− P243,198 P− P243,198
Fair values of assets carried at amortized cost/cost(a)
HTM financial assets
Government bonds P40,492,328 P− P− P40,492,328
Private bonds 14,581,086 − − 14,581,086
Loans and receivables
Corporate and commercial loans − − 294,494,449 294,494,449
Consumer loans − − 53,251,627 53,251,627
Trade-related loans − − 12,945,460 12,945,460
Others − − 309,048 309,048

China Bank 128 Annual Report 2016

 Consolidated
2016
Level 1 Level 2 Level 3 Total
Sales contracts receivable P− P− P876,406 P876,406
Investment properties(b)
Land − − 6,763,387 6,763,387
Buildings and improvements − − 2,221,151 2,221,151
P55,073,414 P− P370,861,528 P425,934,942
Fair values of liabilities carried at
amortized cost(a)
Deposit liabilities P− P− P534,102,368 P534,102,368
Bills payable − − 16,409,581 16,409,581
P− P− P550,511,949 P550,511,949
(a) valued as of December 31, 2016
(b) valued at various dates in 2016 and 2015

Consolidated
2015
Level 1 Level 2 Level 3 Total
Recurring fair value measurements(a)
Financial assets at FVPL
Held-for-trading
Government bonds P1,241,674 P144,850 P− P1,386,524
Treasury notes 385,269 720,983 − 1,106,252
Treasury bills papers 388 594,963 − 595,351
Private bonds 556,570 − − 556,570
Financial assets designated at FVPL 2,299,970 − − 2,299,970
Derivative assets − 299,926 − 299,926
AFS financial assets
Government bonds 29,258,609 10,934,809 − 40,193,418
Quoted private bonds 8,213,921 − − 8,213,921
Quoted equity shares 111,470 − − 111,470
42,067,871 12,695,531 − 54,763,402
Financial liabilities at FVPL
Derivative liabilities − 66,373 − 66,373
P− P66,373 P− P66,373
Fair values of assets carried at amortized cost/cost(a)
HTM financial assets
Government bonds P14,273,659 P− P− P14,273,659
Private bonds 3,324,907 − − 3,324,907
Loans and receivables
Corporate and commercial loans − − 255,872,291 255,872,291
Consumer loans − − 53,331,599 53,331,599
Trade-related loans − − 13,564,618 13,564,618
Others − − 293,602 293,602
Sales contracts receivable − − 974,123 974,123
Investment properties(b) − − − −
Land − − 7,117,231 7,117,231
Buildings and improvements − − 2,401,016 2,401,016
P17,598,566 P− P333,554,480 P351,153,046

China Bank 129 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Consolidated
2015
Level 1 Level 2 Level 3 Total
Fair values of liabilities carried at amortized cost(a)
Deposit liabilities P− P− P429,639,806 P429,639,806
Bills payable − − 18,993,875 18,993,875
P− P− P448,633,681 P448,633,681
(a) valued as of December 31, 2015
(b) valued at various dates in 2015 and 2014

Parent Company
2016
Level 1 Level 2 Level 3 Total
Recurring fair value measurements(a)
Financial assets at FVPL
Held-for-trading
Government bonds P2,158,476 P82,012 P− P2,240,488
Treasury notes − 724,219 − 724,219
Treasury bills − 994,203 − 994,203
Private bonds 594,798 − − 594,798
Financial assets designated at FVPL 2,462,886 − − 2,462,886
Derivative assets − 216,288 − 216,288
AFS financial assets
Government bonds 20,561,662 − − 20,561,662
Quoted private bonds 3,809,166 6,682,562 − 10,157,258
Quoted equity shares 80,947 − − 80,947
29,667,935 8,699,284 − 38,032,749
Financial liabilities at FVPL
Derivative liabilities − 243,198 − 243,198
P− P243,198 P− P243,198
Fair values of assets carried at
amortized cost/cost(a)
HTM financial assets
Government bonds P37,832,994 P− P− P 37,832,994
Private bonds 13,939,793 − − 13,939,793
Loans and receivables
Corporate and commercial loans − − 264,258,587 264,258,587
Consumer loans − − 29,357,086 29,357,086
Trade-related loans − − 11,289,013 11,289,013
Others − − 79,805 79,805
Sales contracts receivable − − 267,688 267,688
Investment properties(b)
Land − − 4,526,165 4,526,165
Buildings and improvements − − 1,074,228 1,074,228
P 51,772,787 P− P 310,852,572 P 362,625,359
Fair values of liabilities carried at
amortized cost
Deposit liabilities P− P− P 462,544,056 P 462,544,056
Bills payable − − 16,409,581 16,409,581
P− P− P 478,953,637 P 478,953,637
(a) valued as of December 31, 2016
(b) valued at various dates in 2016 and 2015

China Bank 130 Annual Report 2016

 Parent Company
2015
Level 1 Level 2 Level 3 Total
Recurring fair value measurements(a)
Financial assets at FVPL
Held-for-trading
Government bonds P847,767 P144,850 P− P992,617
Treasury notes − 720,983 − 720,983
Treasury bills 388 594,963 − 595,351
Private bonds 556,570 − − 556,570
Financial assets designated at FVPL 2,299,970 − − 2,299,970
Derivative assets − 299,926 − 299,926
AFS financial assets
Government bonds 27,728,240 10,934,809 − 38,663,049
Quoted private bonds 7,766,369 − − 7,766,369
Quoted equity shares 111,470 − − 111,470
39,310,774 12,695,531 − 52,006,305
Financial liabilities at FVPL
Derivative liabilities − 66,373 − 66,373
P− P66,373 P− P66,373
Fair values of assets carried at
amortized cost/cost(a)
HTM financial assets
Government bonds P12,532,769 P− P− P12,532,769
Private bonds 2,877,180 − − 2,877,180
Loans and receivables
Corporate and commercial loans − − 223,257,420 223,257,420
Consumer loans − − 30,991,571 30,991,571
Trade-related loans − − 11,559,856 11,559,856
Others − − 74,319 74,319
Sales contracts receivable − − 264,268 264,268
Investment properties(b)
Land − − 4,427,761 4,427,761
Buildings and improvements − − 1,217,191 1,217,191
P15,409,949 P− P271,792,386 P287,202,335
Fair values of liabilities carried at
amortized cost
Deposit liabilities P− P− P363,211,514 P363,211,514
Bills payable − − 18,330,913 18,330,913
P− P− P381,542,427 P381,542,427
(a) valued as of December 31, 2015
(b) valued at various dates in 2015 and 2014

There were no transfers between Level 1 and Level 2 fair value measurements and no transfers into and out of Level 3 fair value measurements
in 2016 and 2015.

The inputs used in the fair value measurement based on Level 2 are as follows:

Government securities - interpolated rates based on market rates of benchmark securities as of reporting date.

Private bonds and commercial papers - quoted market price of comparable investments with credit risk premium that is insignificant to the
entire fair value measurement.

Derivative assets and liabilities - fair values are calculated by reference to the prevailing interest differential and spot exchange rate as of the
reporting date, taking into account the remaining term to maturity of the derivative assets and liabilities.

China Bank 131 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Inputs used in estimating fair values of financial instruments carried at cost and categorized under Level 3 include risk-free rates and applicable
risk premium.

The fair values of the Group’s and Parent Company’s investment properties have been determined by the appraisal method by independent
external and in-house appraisers based on highest and best use of property being appraised. Valuations were derived on the basis of recent
sales of similar properties in the same areas as the investment properties and taking into account the economic conditions prevailing at the time
the valuations were made and comparability of similar properties sold with the property being valued.

The table below summarizes the valuation techniques used and the significant unobservable inputs valuation for each type of investment
properties held by the Group and the Parent Company:

Valuation Techniques Significant Unobservable Inputs

Land Market Data Approach Price per square meter, size, location, shape, time
element and corner influence
Land and Building Market Data Approach and Cost Approach Reproduction Cost New

Description of the valuation techniques and significant unobservable inputs used in the valuation of the Group and the Parent Company’s
investment properties are as follows:

Valuation Techniques
Market Data Approach A process of comparing the subject property being appraised to similar comparable properties recently
sold or being offered for sale.

Cost Approach It is an estimate of the investment required to duplicate the property in its present condition. It is reached
by estimating the value of the building “as if new” and then deducting the depreciated cost. Fundamental
to the Cost Approach is the estimate of Reproduction Cost New of the improvements.

Significant Unobservable Inputs

Reproduction Cost New The cost to create a virtual replica of the existing structure, employing the same design and similar building
materials.

Size Size of lot in terms of area. Evaluate if the lot size of property or comparable conforms to the average cut
of the lots in the area and estimate the impact of lot size differences on land value.

Shape Particular form or configuration of the lot. A highly irregular shape limits the usable area whereas an ideal
lot configuration maximizes the usable area of the lot which is associated in designing an improvement
which conforms with the highest and best use of the property.

Location Location of comparative properties whether on a Main Road, or secondary road. Road width could also
be a consideration if data is available. As a rule, properties located along a Main Road are superior to
properties located along a secondary road.

Time Element “An adjustment for market conditions is made if general property values have appreciated or depreciated
since the transaction dates due to inflation or deflation or a change in investors’ perceptions of the market
over time”. In which case, the current data is superior to historic data.

Discount Generally, asking prices in ads posted for sale are negotiable. Discount is the amount the seller or
developer is willing to deduct from the posted selling price if the transaction will be in cash or equivalent.

Corner influence Bounded by two (2) roads.

6. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Group’s activities are principally related to the profitable use of financial instruments. Risks are inherent in these activities but are managed
by the Group through a rigorous, comprehensive and continuous process of identification, measurement, monitoring and mitigation of these
risks, partly through the effective use of risk and authority limits and thresholds, process controls and monitoring, and independent controls.
As reflected in its corporate actions and organizational improvements, the Group has placed due importance on expanding and strengthening
its risk management process and considers it as a vital component to the Group’s continuing profitability and financial stability. Central to the
Group’s risk management process is its adoption of a risk management program intended to avoid unnecessary risks, manage and mitigate
unavoidable risks and maximize returns from taking acceptable risks necessary to sustain its business viability and good financial position in
the market.

China Bank 132 Annual Report 2016

The key financial risks that the Group faces are: credit risk, market risk (i.e. interest rate risk, foreign currency risk and equity price risk) and
liquidity risk. The Group’s risk management objective is primarily focused on controlling and mitigating these risks. The Parent Company and its
subsidiaries manage their respective financial risks separately. The subsidiaries, particularly CBS, have their own risk management processes
but are structured similar to that of the Parent Company. To a large extent, the respective risk management programs and objectives are the
same across the Group. The gravity of the risks, the magnitude of the financial instruments involved, and regulatory requirements are primary
considerations to the scope and extent of the risk management processes put in place for the subsidiaries.

Risk Management Structure

The BOD of the Parent Company is ultimately responsible for the oversight of the Parent Company’s risk management process. On the other
hand, the risk management processes of the subsidiaries are the separate responsibilities of their respective BODs. The BOD of the Parent
Company created a separate board-level independent committee with explicit authority and responsibility for managing and monitoring risks.

The BOD has delegated to the Risk Management Committee (RMC) the implementation of the risk management process which includes,
among others, the development of various risk strategies and principles, control guidelines policies and procedures, implementation of risk
measurement tools, monitoring of key risk indicators, and the imposition and monitoring of risk limits and thresholds. The RMC is composed
of four members of the BOD.

The Risk Management Group (RMG) is the direct support of the RMC in the day-to-day risk management and the implementation of the risk
management strategies approved by the RMC. The implementation cuts across all departments of the Parent Company and involves all of the
Parent Company’s financial instruments, whether “on-books” or “off-books.” The RMG is likewise responsible for monitoring the implementation
of specific risk control procedures and enforcing compliance thereto. The RMG is also directly involved in the day-to-day risk measurement
and monitoring to make sure that the Parent Company, in its transactions and dealings, engages only in acceptable and manageable financial
risks. The RMG also ensures that risk measurements are accurately and completely captured on a timely basis in the management reporting
system of the Parent Company. The RMG regularly reports the results of the risk measurements to the RMC. The RMG is headed by the Chief
Risk Officer (CRO).

Apart from RMG, each business unit has created and put in place various process controls which ensure that all the external and internal
transactions and dealings of the unit are in compliance with the unit’s risk management objectives.

The Internal Audit Division also plays a crucial role in risk management primarily because it is independent of the business units and reports
exclusively to the Audit Committee which, in turn, is comprised of independent directors. The Internal Audit Division focuses on ensuring that
adequate controls are in place and on monitoring compliance to controls. The regular audit covers all processes and controls, including those
under the risk management framework handled by the RMG. The audit of these processes and controls is undertaken at least annually. The
audit results and exceptions, including recommendations for their resolution or improvement, are discussed initially with the business units
concerned before these are presented to the Audit Committee.

Risk Management Reporting

The CRO and other members of the RMG report to the RMC and are a resource to the Management Committee (ManCom) on a monthly and
a weekly basis, respectively. The CRO reports on key risk indicators and specific risk management issues that would need resolution from top
management. This is undertaken after the risk issues and key risk indicators have been discussed with the business units concerned.

The key risk indicators were formulated on the basis of the financial risks faced by the Parent Company. The key risk indicators contain
information from all business units that provide measurements on the level of the risks taken by the Parent Company in its products, transactions
and financial structure. Among others, the report on key risk indicators includes information on the Parent Company’s aggregate credit
exposure, credit metric forecasts, hold limit exceptions, Value-at-Risk (VaR) analysis, utilization of market and credit limits and thresholds,
liquidity risk limits and ratios, overall loan loss provisioning and risk profile changes. Loan loss provisioning and credit limit utilization are,
however, discussed in more detail in the Credit Committee. On a monthly basis, detailed reporting of single-name and sectoral concentration
is included in the discussion with the RMC. On the other hand, the Chief Internal Auditor reports to the Audit Committee on a monthly basis on
the results of branch or business unit audits and for the resolution of pending but important internal audit issues.

In 2016, the Asset and Liability Management (ALM) system of the Parent Company, measures and reports liquidity risk and interest rate risk
was upgraded in 2016 and will include new modules for calculating Basel III’s Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio
(NSFR) in 2017. Similarly, the Market Risk Management System, enhances risk measurement and automates reporting of market risk metrics,
has been implemented in 2016.

Risk Mitigation
The Parent Company uses derivatives to manage exposures in its financial instruments resulting from changes in interest rates and foreign
currencies exposures. However, the nature and extent of use of these financial instruments to mitigate risks are limited to those allowed by the
BSP for the Parent Company and its subsidiaries.

To further mitigate risks throughout its different business units, the Parent Company formulates risk management policies and continues to
improve its existing policies. These policies further serve as the framework and set of guidelines in the creation or revisions of operating policies
and manuals for each business unit. In the process design and implementation, preventive controls are preferred over detection controls. Clear
delineation of responsibilities and separation of incompatible duties among officers and staff, as well as, among business units are reiterated
in these policies. To the extent possible, reporting and accounting responsibilities are segregated from units directly involved in operations

China Bank 133 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

and front line activities (i.e., players must not be scorers). This is to improve the credibility and accuracy of management information. Any
inconsistencies in the operating policies and manuals with the risk framework created by the RMG are taken up and resolved in the RMC and
ManCom.

Based on the approved Operational Risk Assessment Program, RMG spearheaded the bankwide (all Head Office units and branches) risk
identification and self-assessment process. This would enable determination of priority risk areas, assessment of mitigating controls in place,
and institutionalization of additional measures to ensure a controlled operating environment. RMG was also mandated to maintain and update
the Parent Company’s Centralized Loss Database wherein all reported incidents of losses shall be encoded to enable assessment of weaknesses
in the processes and come up with viable improvements to avoid recurrence.

Monitoring and controlling risks are primarily performed based on various limits and thresholds established by the top management covering the
Group’s transactions and dealings. These limits and thresholds reflect the Group’s business strategies and market environment, as well as the
levels of risks that the Group is willing to tolerate, with additional emphasis on selected industries. In addition, the Parent Company monitors
and measures the overall risk-bearing capacity in relation to the aggregate risk exposure across all risk types and activities.

Liquidity and interest rate risk exposures are measured and monitored through reports from the ALM system. The system also has a Funds
Transfer Pricing module used by the Treasury Group and Corporate Planning Group.

For the measurement of market risk exposures, the Bank uses Historical Simulation VaR approach for all treasury traded instruments, including
fixed income bonds, foreign exchange swaps and forwards, interest rate swaps and equity securities. Market risk exposures are measured and
monitored through reports from the Market Risk Management System which has been implemented in 2016 to enhance risk measurement and
automate daily reporting.

BSP issued Circular No. 639 dated January 15, 2009 which mandated the use of the Internal Capital Adequacy Assessment Process (ICAAP)
by all universal and commercials banks to determine their minimum required capital relative to their business risk exposures. In this regard, the
Board approved the engagement of the services of a consultant to assist in the bank-wide implementation and embedding of the ICAAP, as
provided for under Pillar 2 of Basel II and BSP Circular No. 639.

On April 6, 2016, the BOD affirmed that the priority risks set in the 2009 Risk Self-assessment Survey and voting conducted among selected
members of the BOD and Senior Management remain the same on the basis that there is no significant change in either the business model of
the Bank or its ownership structure. In addition, the BOD also approved the CET1 ratio limit and the revised Management Action Trigger (MAT)
on capital ratios, as well as the metrics for determining significant change in the balance sheet. There were no changes made in the approved
trigger events for the review of Priority Risks and Capital Ratios threshold.

The Parent Company submitted its annually updated ICAAP document, in compliance with BSP requirements on March 31, 2016. The
document disclosed that the Parent Company has an appropriate level of internal capital relative to the Group’s risk profile.

For the ICAAP document submitted on March 31, 2016, the Parent Company retained the Pillar 1 Plus approach using the Pillar 1 capital as
the baseline. The process of allocating capital for all types of risks above the Pillar 1 capital levels was enhanced to include quantification of
capital buffer for Pillar 2 risks under normal business cycle/condition, in addition to the quantification based on the results of the Integrated
Stress Test (IST). The adoption of the IST allows the Parent Company to quantify its overall vulnerability to market shocks and operational losses
in a collective manner driven by events rather than in silo. The capital assessment in the document discloses that the Group and the Parent
Company has appropriate and sufficient level of internal capital.

Credit Risk

Credit Risk and Concentration of Assets and Liabilities and Off-Balance Sheet Items
Credit risk is the risk of financial loss on account of a counterparty to a financial product failing to honor its obligation. The Group faces potential
credit risks every time it extends funds to borrowers, commits funds to counterparties, guarantees the paying performance of its clients, invests
funds to issuers (i.e., investment securities issued by either sovereign or corporate entities) or enters into either market-traded or over-the-
counter derivatives, through implied or actual contractual agreements (i.e., on or off-balance sheet exposures). The Group manages its credit
risk at various levels (i.e., strategic level, portfolio level down to individual credit or transaction).

The Group established risk limits and thresholds for purposes of monitoring and managing credit risk from individual counterparties and/or
groups of counterparties, as well as industry divisions. It also conducts periodical assessment of the creditworthiness of its counterparties. In
addition, the Group obtains collateral where appropriate, enters into master netting agreements and collateral arrangements with counterparties,
and limits the duration of exposures.

In compliance with BSP requirements, the Group established an internal Credit Risk Rating System (CRRS) for the purpose of measuring credit
risk for corporate borrowers in a consistent manner, as accurately as possible, and thereafter uses the risk information for business and financial
decision making. The CRRS covers corporate borrowers with total assets, total facilities, or total credit exposures amounting to P15.00 million
and above.

China Bank 134 Annual Report 2016

Further, the CRRS was designed within the technical requirements defined under BSP Circular No. 439. It has two components, namely: a)
Borrower Risk Rating which provides an assessment of the creditworthiness of the borrower, without considering the proposed facility and
security arrangements, and b) Loan Exposure Rating which provides an assessment of the proposed facilities as mitigated or enhanced by
security arrangements. The CRRS rating scale consists of ten grades, six of which fall under unclassified accounts, with the remaining four
falling under classified accounts in accordance with regulatory provisioning guidelines.

On March 5, 2014, the Parent Company approved the engagement of a third-party consultant, Moody’s Analytics, for the quantitative and
qualitative validation of the internal CRRS. The validation engagement was completed in December 2014 followed by the model recalibration,
closing the project in December 2015.

Aside from the internal CRRS, the Parent Company launched in 2011 the Borrower Credit Score (BCS), a credit scoring system designed for
retail small and medium entities and individual loan accounts. In 2016, RMG completed the statistical validation of the BCS using the same
methodology applied to the validation of the corporate risk rating model. The validation process was conducted with the assistance of Teradata
which provided the analytics platform, tools and technical guidance for both credit model performance assessment and recalibration.

Furthermore, RMG also developed a Sovereign Risk Rating Model, which provided the tool for the Bank to assess the strength of the country
rated in reference to its economic fundamentals, fiscal policy, institutional strength, and vulnerability to extreme events. The Model was approved
by the Board on September 7, 2016.

The Group has not yet applied the above models for its loan loss provisioning.

Excessive Risk Concentration

Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographic region, or
have similar economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic,
political or other conditions. Concentrations indicate the relative sensitivity of the Parent Company’s performance to developments affecting a
particular industry or geographical location.

In order to avoid excessive concentrations of risk, the Parent Company’s policies and procedures include specific guidelines focusing on
maintaining a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.

The distribution of the Group’s and Parent Company’s assets and liabilities, and credit commitment items (Note 29) by geographic region as of
December 31, 2016 and 2015 (in millions) follows:

Consolidated
2016 2015
Assets Liabilities Commitment Assets Liabilities Commitment
Geographic Region
Philippines P557,597 P549,944 P161,187 P476,778 P450,788 P154,944
Asia 8,065 13,200 3,629 5,896 14,038 2,956
Europe 3,608 1,050 808 598 16 498
United States 33,336 1,240 6,287 21,390 87 3,174
Others 9,911 1,486 14 2,106 19 19
P612,517 P566,920 P171,925 P506,768 P464,948 P161,591

Parent Company
2016 2015
Assets Liabilities Commitment Assets Liabilities Commitment
Geographic Region
Philippines P480,892 P477,297 P155,828 P407,221 P382,367 P145,950
Asia 8,065 13,200 3,629 5,896 14,038 2,956
Europe 3,608 1,050 808 598 16 498
United States 33,242 1,240 6,287 21,221 87 3,174
Others 9,911 1,486 14 2,106 19 20
P535,718 P494,273 P166,566 P437,042 P396,527 P152,598

Information on credit concentration as to industry of loans and receivables is presented in Note 9 to the financial statements.

China Bank 135 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Maximum exposure to credit risk

The tables below provide the analysis of the maximum exposure to credit risk of the Group and the Parent Company’s financial instruments,
excluding those where the carrying values as reflected in the balance sheets and related notes already represent the financial instrument’s
maximum exposure to credit risk, before and after taking into account collateral held or other credit enhancements:

Consolidated
2016
Financial effect
of collateral or
Gross maximum credit
exposure Net exposure enhancement
Credit risk exposure relating to on-balance sheet items
are as follows
Loans and receivables P386,827,300 P209,916,716 P176,779,137
Sales contracts receivable 893,084 – 893,084
P387,720,384 P209,916,716 P177,672,221

Consolidated
2015
Financial effect
of collateral or
Gross maximum credit
exposure Net exposure enhancement
Credit risk exposure relating to on-balance sheet items
are as follows
Loans and receivables P309,761,777 P177,020,802 P132,740,975
Sales contracts receivable 967,329 – 967,329
P310,729,106 P177,020,802 P133,708,304

Parent Company
2016
Financial effect
of collateral or
Gross maximum credit
exposure Net exposure enhancement
Credit risk exposure relating to on-balance sheet items
are as follows
Loans and receivables P329,069,859 P189,224,249 P139,845,609
Sales contracts receivable 224,149 – 224,149
P329,294,008 P189,224,249 P140,069,758

Parent Company
2015
Financial effect
of collateral or
Gross maximum credit
exposure Net exposure enhancement
Credit risk exposure relating to on-balance sheet items
are as follows
Loans and receivables P259,645,008 P161,244,693 P98,400,315
Sales contracts receivable 257,473 – 257,473
P259,902,481 P161,244,693 P98,657,788

China Bank 136 Annual Report 2016

For the Group, the fair values of collateral held for loans and receivables and sales contracts receivable amounted to P250.62 billion and
P1.60 billion, respectively, as of December 31, 2016 and P149.00 billion and P2.70 billion, respectively, as of December 31, 2015.

For the Parent Company, the fair values of collateral held for loans and receivables and sales contracts receivable amounted to P202.74 billion
and P1.36 billion, respectively, as of December 31, 2016 and P123.76 billion and P1.24 billion, respectively, as of December 31, 2015.

Credit risk, in respect of derivative financial products, is limited to those with positive fair values, which are included under financial assets at
FVPL (Note 8). As a result, the maximum credit risk, without taking into account the fair value of any collateral and netting agreements, is limited
to the amounts on the balance sheet plus commitments to customers such as unused commercial letters of credit, outstanding guarantees and
others as disclosed in Note 29 to the financial statements.

Collateral and other credit enhancements

The amount and type of collateral required depends on an assessment of the credit risk of the counterparty. Guidelines are implemented with
regard to the acceptability of types of collateral and valuation parameters.

The main types of collateral obtained are as follows:

• For securities lending and reverse repurchase transactions - cash or securities
• For consumer lending - real estate and chattel over vehicle
• For corporate lending and commercial lending- real estate, chattel over properties, assignment of deposits, shares of stocks, bonds, and
guarantees

Management requests additional collateral in accordance with the underlying agreement and takes into consideration the market value of
collateral during its review of the adequacy of allowance for credit losses.

It is the Group’s policy to dispose of repossessed properties in an orderly fashion. The proceeds are used to reduce or repay the outstanding
claim. In most cases, the Parent Company does not occupy repossessed properties for business use.

Collaterals foreclosed in 2016 and 2015 and are still held by the Group as of December 31, 2016 and 2015 amounted to P835.30 million and
P848.48 million, respectively. These collaterals comprised of real estate properties and stock securities.

Credit quality per class of financial assets

The credit quality of financial assets is managed by the Group using an internal credit rating system for the purpose of measuring credit risk in a
consistent manner as accurately as possible. The model on risk ratings is assessed regularly because the Group uses this information as a tool
for business and financial decision making. Aside from the periodic review by the Bank’s Internal Audit Group, the Bank likewise engaged the
services of third-party consultants in 2014, 2015, and 2016 for purposes of conducting an independent validation of the credit risk rating model.

It is the Parent Company’s policy to maintain accurate and consistent risk ratings across the credit portfolio. This facilitates focused management
of the applicable risks and the comparison of credit exposures across all lines of business, geographic regions and products. The rating system
is supported by a variety of financial analytics, combined with processed market information to provide the main inputs for the measurement of
counterparty risk. All internal risk ratings are tailored to the various categories and are derived in accordance with the Parent Company’s rating
policy. The attributable risk ratings are assessed and monitored regularly. The standard credit rating equivalent grades are relevant only for
certain exposures in each risk rating class.

The following table shows the description of the internal CRRS grade:

CRRS Grade Description

1 Excellent
2 Strong
3 Good
4 Satisfactory
5 Acceptable
6 Watchlist
7 Especially Mentioned
8 Substandard
9 Doubtful
10 Loss

China Bank 137 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

The credit grades are defined as follows:

Excellent - This category applies to a borrower with a very low probability of going into default in the coming year. The borrower has a high
degree of stability, substance, and diversity. It has access to raise substantial amounts of funds through the public markets at any time. The
borrower has a very strong debt service capacity and a conservative use of balance sheet leverage. The track record in profit terms is very
good. The borrower is of highest quality under virtually all economic conditions.

Strong - This category applies to a borrower with a low probability of going into default in the coming year. The borrower normally has a
comfortable degree of stability, substance, and diversity. Under normal market conditions, the borrower in this category has good access to
public markets to raise funds. The borrower has a strong market and financial position with a history of successful performance. The overall
debt service capacity as measured by cash flow to total debt service is deemed very strong; the critical balance sheet ratios (vis-à-vis industry)
are conservative.

Good - This category covers the smaller corporations with limited access to public capital markets or access to alternative financial markets.
This access is however limited to favorable economic and/or market conditions. Typical for this type of borrower is the combination of
comfortable asset protection and acceptable balance sheet structure (vis-à-vis industry). The debt service capacity, as measured based on
cash flows, is strong.

Satisfactory - This category represents the borrower where clear risk elements exist and the probability of default is somewhat greater. This
probability is reflected in volatility of earnings and overall performance. The borrower in this category normally has limited access to public
financial markets. The borrower should be able to withstand normal business cycles, but any prolonged unfavorable economic period would
create deterioration beyond acceptable levels. Typical for this kind of borrower is the combination of reasonably sound asset and cash flow
protection. The debt service capacity as measured by cash flow is deemed adequate. The borrower has reported profits for the past fiscal year
and is expected to report a profit in the current year.

Acceptable - The risk elements for the Parent Company are sufficiently pronounced, although the borrower should still be able to withstand
normal business cycles. Any prolonged unfavorable economic and/or market period would create an immediate deterioration beyond
acceptable levels.

Watchlist - This category represents the borrower for which unfavorable industry or company-specific risk factors represent a concern. Operating
performance and financial strength may be marginal and it is uncertain whether the borrower can attract alternative sources of financing. The
borrower will find it very hard to cope with any significant economic downturn and a default in such a case is more than a possibility. It includes
the borrower where the credit exposure is not a risk of loss at the moment, but the performance of the borrower has weakened, and unless
present trends are reversed, could lead to losses.

Especially Mentioned - This category applies to the borrower that is characterized by a reasonable probability of default, manifested by some
or all the following: (a) evidence of weakness in the borrower’s financial condition or creditworthiness; (b) unacceptable risk is generated by
potential or emerging weaknesses as far as asset protection and/or cash flow is concerned; (c) the borrower has reached a point where there
is a real risk that the borrower’s ability to pay the interest and repay the principal timely could be jeopardized; (d) the borrower is expected
to have financial difficulties and exposure may be at risk. Closer account management attention is warranted. Concerted efforts should be
made to improve lender’s position (e.g., demanding additional collateral or reduction of account exposure). These potential weaknesses, if left
uncorrected or unmitigated, would affect the repayment of the loan and, thus, increase credit risk to the Parent Company.

Substandard - This category represents the borrower where one or more of the following factors apply: (a) the collection of principal or interest
becomes questionable regardless of scheduled payment date, by reason of adverse developments on account of a financial, managerial,
economic, or political nature, or by important weaknesses in cover; (b) the probability of default is assessed at up to 50%. Substandard
loans are loans or portions thereof which appear to involve a substantial and unreasonable degree of risk to the Parent Company because of
unfavorable record or unsatisfactory characteristics. There exists in such loans the possibility of future loss to the Parent Company unless given
closer supervision.

Doubtful - This category includes the borrower with “non-performing loan” status or with any portion of interest and/or principal payment is
in arrears for more than ninety (90) days. The borrower is unable or unwilling to service debt over an extended period of time and near future
prospects of orderly debt service is doubtful. Doubtful loans are loans or portions thereof which have the weaknesses inherent in those
classified as “Substandard”, with the added characteristics that existing facts, conditions, and values make collection or liquidation in full highly
improbable and in which substantial loss is probable.

Loss - This category represents the borrower whose prospect for re-establishment of creditworthiness and debt service is remote. It also
applies where the Parent Company will take or has taken title to the assets of the borrower and is preparing a foreclosure and/or liquidation of
the borrower’s business. These are loans or portions thereof which are considered uncollectible or worthless and of such little value that their
continuance as bankable assets is not warranted although the loans may have some recovery or salvage value.

China Bank 138 Annual Report 2016

The ratings of the borrowers covered by the BCS were mapped to the abovementioned CRRS grades in accordance with the approved
guidelines by the BOD.

The Group’s loans and receivables from customers were classified according to credit quality as follows:

Credit Quality Rating Criteria

Neither Past Due Nor Impaired
High Loans with risk rating of 1 and 2
Standard Loans with risk rating of 3 to 5
Sub-Standard Generally, loans with risk rating of 6 to 8
Past Due and Impaired
Past Due but not Impaired Those that were classified as Past Due per BSP guidelines or
Impaired those that are still in current status but have objective evidence
of impairment; Generally, loans with risk rating of 9 to 10

The table below shows the Group’s and the Parent Company’s loans and receivables, excluding other receivables (gross of allowance for
impairment and credit losses and unearned discounts) as of December 31, 2016 and 2015 (in millions) classified according to credit quality:

Consolidated
2016
Neither Past Due nor Impaired
Standard Substandard Past Due But Past Due
High Grade Grade Grade Unrated Not Impaired and Impaired Total
Corporate and commercial
lending P51,949 P194,211 P63,431 P2,941 P1,051 P6,150 P319,733
Consumer lending 22,997 5,989 3,308 24,388 3,155 579 60,416
Trade-related lending 2,122 9,861 961 20 6 76 13,046
Others 317 1 – 212 5 8 543
Total P77,385 P210,062 P67,700 P27,561 P4,217 P6,813 P393,738

Consolidated
2015
Neither Past Due nor Impaired
Standard Substandard Past Due But Past Due
High Grade Grade Grade Unrated Not Impaired and Impaired Total
Corporate and commercial
lending P48,206 P136,561 P46,151 P17,107 P2,022 P5,904 P255,951
Consumer lending 15,306 7,294 1,595 20,600 2,243 975 48,013
Trade-related lending 1,694 10,047 418 20 258 313 12,750
Others 46 – – 261 6 8 321
Total P65,252 P153,902 P48,164 P37,988 P4,529 P7,200 P317,035

Parent Company
2016
Neither Past Due nor Impaired
Standard Substandard Past Due But Past Due
High Grade Grade Grade Unrated Not Impaired and Impaired Total
Corporate and commercial
lending P23,263 P194,185 P63,039 P2,942 P761 P3,932 P288,122
Consumer lending 10 5,968 3,308 24,388 1,157 578 35,409
Trade-related lending 453 9,861 961 20 6 76 11,377
Others – 1 – 68 – – 69
Total P23,726 P210,015 P67,308 P27,418 P1,924 P4,586 P334,977

China Bank 139 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Parent Company
2015
Neither Past Due nor Impaired
Standard Substandard Past Due But Past Due
High Grade Grade Grade Unrated Not Impaired and Impaired Total
Corporate and commercial
lending P23,311 P134,385 P45,862 P16,927 P1,752 P3,268 P225,505
Consumer lending 22 6,283 1,192 20,112 1,269 363 29,241
Trade-related lending 91 10,047 418 21 258 313 11,148
Others – – – 69 2 – 71
Total P23,424 P150,715 P47,472 P37,129 P3,281 P3,944 P265,965

Depository accounts with the BSP and counterparty banks, Trading and Investment Securities
For these financial assets, outstanding exposure is rated primarily based on external risk rating (i.e. Standard and Poor’s (S&P), otherwise, rating
is based on risk grades by a local rating agency or included under “Unrated”, when the counterparty has no available risk grade.

The external risk rating of the Group’s depository accounts with the BSP and counterparty banks, trading and investment securities, is grouped
as follows:

Credit Quality Rating External Credit Risk Rating Credit Rating Agency
High grade AAA, AA+, AA, AA- S&P
Aaa, Aa1, Aa2, Aa3 Moody’s
AAA, AA+, AA, AA- Fitch
Standard grade A+, A, A-, BBB+, BBB, BBB- S&P
A1, A2, A3, Baa1, Baa2, Baa3 Moody’s
A+, A, A-, BBB+, BBB, BBB- Fitch
Substandard grade BB+, BB, BB-, B/B+, CCC, R, SD & D S&P
Ba1, Ba2, Ba3, B1, B2, R, SD & D Moody’s
BB+, BB, BB-, B/B+, CCC, R, SD & D Fitch

Following is the credit rating scale applicable for foreign banks, and government securities (aligned with S&P ratings):

AAA - An obligor has extremely strong capacity to meet its financial commitments.

AA - An obligor has very strong capacity to meet its financial commitments. It differs from the highest-rated obligors at a minimal degree.

A - An obligor has strong capacity to meet its financial commitments but is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than obligors in higher-rated categories.

BBB and below:

BBB - An obligor has adequate capacity to meet its financial commitments. However, adverse economic conditions or changing circumstances
are more likely to lead to a weakened capacity of the obligor to meet its financial commitments.

BB - An obligor is less vulnerable in the near term than other lower-rated obligors. However, it faces major ongoing uncertainties and exposure
to adverse business, financial, or economic conditions which could lead to the obligor’s inadequate capacity to meet its financial commitments.

B - An obligor is more vulnerable than the obligors rated ‘BB’, but the obligor currently has the capacity to meet its financial commitments.
Adverse business, financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its financial commitments.

CCC - An obligor is currently vulnerable and is dependent upon favorable business, financial, and economic conditions for the obligor to meet
its financial commitments.

CC - An obligor is currently vulnerable. The rating is used when a default has not yet occurred, but expects default to be a virtual certainty,
regardless of the anticipated time to default.

R - An obligor is under regulatory supervision owing to its financial condition. During the pendency of the regulatory supervision, the regulators
may have the power to favor one class of obligations over others or pay some obligations and not others.

China Bank 140 Annual Report 2016

SD and D - An obligor is in default on one or more of its financial obligations including rated and unrated financial obligations but excluding
hybrid instruments classified as regulatory capital or in non-payment according to terms.

The table below shows the credit quality of deposits and investments as of December 31, 2016 and 2015 (in millions), based on external risk
ratings (gross of allowance for credit losses).

Consolidated
2016
Substandard
High Grade Standard Grade Grade Total
Due from BSP P– P91,964 P– P91,964
Due from other banks 1,527 6,569 875 8,971
SPURA – 3,452 – 3,452
Financial assets at FVPL 36 4,622 237 4,895
AFS financial assets 10,119 13,970 1,593 25,682
HTM financial assets 318 48,513 3,056 51,887
P12,000 P169,090 P5,761 P186,851

Consolidated
2015
Substandard
High Grade Standard Grade Grade Total
Due from BSP P− P86,319 P− P86,319
Due from other banks 2,587 15,038 1,262 18,887
Financial assets at FVPL 102 3,169 306 3,577
AFS financial assets 1,252 35,934 4,318 41,504
HTM financial assets − 13,507 483 13,990
P3,941 P153,967 P6,369 P164,277

Parent Company
2016
Substandard
High Grade Standard Grade Grade Total
Due from BSP P– P85,307 P– P85,307
Due from other banks 1,527 6,394 1,624 9,545
SPURA − 2,958 − 2,958
Financial assets at FVPL 36 4,151 237 4,424
AFS financial assets 10,117 11,614 1,592 23,323
HTM financial assets 319 45,177 3,056 48,552
P11,999 P155,601 P6,509 P174,109

Parent Company
2015
Substandard
High Grade Standard Grade Grade Total
Due from BSP P− P77,004 P− P77,004
Due from other banks 2,489 15,038 1,553 19,080
Financial assets at FVPL 102 2,466 306 2,874
AFS financial assets 1,249 35,798 4,318 41,365
HTM financial assets − 11,422 483 11,905
P3,840 P141,728 P6,660 P152,228

China Bank 141 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Due from other banks and government securities

The external risk rating of the Group’s depository accounts with counterparty banks, trading and investment securities, is grouped as follows
(aligned with the Philippine Ratings System):

Credit Quality Rating External Credit Risk Rating

High grade PRSAAA, PRSAa+, PRSAa, PRSAa-
Standard grade PRSA+, PRSA, PRSA-, PRSBaa+, PRSBaa, PRSBaa-
Substandard grade PRSBa+, PRSBa, PRSBa-, PRSB+, PRSB, PRSB-, PRSCaa+, PRSCaa,
PRSCaa-, PRSCa+, PRSCa, PRSCa-, PRSC+, PRSC, PRSC-

PRSAaa - The obligor’s capacity to meet its financial commitment on the obligation is extremely strong.

PRSAa - The obligor’s capacity to meet its financial commitment on the obligation is very strong.

PRSA - With favorable investment attributes and are considered as upper-medium grade obligations. Although obligations rated ‘PRSA’ are
somewhat more susceptible to the adverse effects of changes in economic conditions, the obligor’s capacity to meet its financial commitment
on the obligation is still strong.

PRSBaa - An obligation rated ‘PRSBaa’ exhibits adequate protection parameters. However, adverse economic conditions and changing
circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation. PRSBaa-rated
issues may possess certain speculative characteristics.

PRSBa - An obligation rated ‘PRSBa’ is less vulnerable to nonpayment than other speculative issues. However, it faces major ongoing
uncertainties relating to business, financial or economic conditions, which could lead to the obligor’s inadequate capacity to meet its financial
commitment on the obligation.

PRSB - An obligation rated ‘PRSB’ is more vulnerable to nonpayment than obligations rated ‘PRSBa’, but the obligor currently has the capacity
to meet its financial commitment on the obligation. Adverse economic conditions will likely impair the obligor’s capacity to meet its financial
commitment on the obligation. The issue is characterized by high credit risk.

PRSCaa - An obligation rated ‘PRSCaa’ is presently vulnerable to nonpayment and is dependent upon favorable business, financial and
economic conditions for the obligor to meet its financial commitment on the obligation. In the event of adverse economic conditions, the
obligor is not likely to have the capacity to meet its financial commitment on the obligation. The issue is considered to be of poor standing and
is subject to very high credit risk.

PRSCa - An obligation rated “PRSCa” is presently highly vulnerable to nonpayment. Likely already in or very near default with some prospect
for partial recovery of principal or interest.

PRSC - An obligation is already in default with very little prospect for any recovery of principal or interest.

The table below shows the credit quality of deposits and investments, by class, as of December 31, 2016 and 2015 (in millions), based on risk
grades of a local rating agency (gross of allowance for credit losses).

Consolidated
2016
Substandard
High Grade Standard Grade Grade Total
Due from other banks P145 P– P– P145
Financial assets at FVPL 487 – – 487
AFS financial assets 1,470 – – 1,470
HTM financial assets 534 – – 534
Total P2,636 P– P– P2,636

Consolidated
2015
Substandard
High Grade Standard Grade Grade Total
Due from other banks P836 P– P– P836
Financial assets at FVPL 187 – – 187
AFS financial assets 2,160 17 – 2,177
HTM financial assets 106 – – 106
Total P3,289 P17 P– P3,306

China Bank 142 Annual Report 2016

 Parent Company
2016
Substandard
High Grade Standard Grade Grade Total
Due from other banks P144 P– P– P144
Financial assets at FVPL 487 – – 487
AFS financial assets 1,435 – – 1,435
HTM financial assets 534 – – 534
Total P2,600 P– P– P2,600

Parent Company
2015
Substandard
High Grade Standard Grade Grade Total
Due from other banks P119 P– P– P119
Financial assets at FVPL 111 – – 111
AFS financial assets 320 – – 320
Total P550 P– P– P550

The table below shows the breakdown of unrated deposits and investments (gross of allowance for credit losses)as of December 31, 2016 and
2015 (in millions):

Consolidated Parent Company

2016 2015 2016 2015
Due from other banks P2,216 P1,520 P– P2
Financial assets at FVPL 2,322 2,481 2,322 2,480
AFS financial assets 6,760 5,187 6,402 5,156
HTM financial assets 4,983 2,040 4,983 2,041
Other assets* 5,652 4,977 3,605 3,320
Total P21,933 P16,205 P17,312 P12,999
*Other assets include accounts receivables, sales contract receivable, returned checks and other cash items and miscellaneous financial
assets (Note 14).

The table below shows the aging analysis of gross past due but not impaired loans and receivables that the Group and Parent Company held
as of December 31, 2016 and 2015 (in millions). Under PFRS 7, a financial asset is past due when a counterparty has failed to make a payment
when contractually due.

Consolidated
Less than More than
December 31, 2016 30 days 31 to 60 days 61 to 90 days 91 days Total
Loans and receivables
Corporate and commercial lending P567 P70 P86 P 328 P1051
Consumer lending 296 113 317 2,429 3,155
Trade-related lending − − − 6 6
Others − − − 5 5
Total P863 P183 P403 P2,768 P4,217

Consolidated
Less than More than
December 31, 2015 30 days 31 to 60 days 61 to 90 days 91 days Total
Loans and receivables
Corporate and commercial lending P532 P122 P162 P1,206 P2,022
Consumer lending 350 67 107 1,719 2,243
Trade-related lending 157 − 5 96 258
Others 1 1 1 3 6
Total P1,040 P190 P275 P3,024 P4,529

China Bank 143 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Parent Company
Less than More than
December 31, 2016 30 days 31 to 60 days 61 to 90 days 91 days Total
Loans and receivables
Corporate and commercial lending P530 P69 P71 P 91 P761
Consumer lending 213 56 204 684 1,157
Trade-related lending − − − 6 6
Total P743 P125 P275 P781 P1,924

Parent Company
Less than More than
December 31, 2015 30 days 31 to 60 days 61 to 90 days 91 days Total
Loans and receivables
Corporate and commercial lending P492 P101 P112 P1,047 P1,752
Consumer lending 303 38 35 893 1,269
Trade-related lending 157 − 5 96 258
Others 1 − − 1 2
Total P953 P139 P152 P2,037 P3,281

The following table presents the carrying amount of financial assets of the Group and Parent Company as of December 31, 2016 and 2015 that
would have been considered past due or impaired if not renegotiated:

Consolidated Parent Company

2016 2015 2016 2015
Loans and advances to customers
Corporate and commercial lending P773,888 P937,398 P358,760 P436,322
Consumer lending 14,669 12,020 9,777 7,478
Total renegotiated financial assets P788,557 P949,418 P368,537 P443,800

Impairment assessment
The main considerations for the loan impairment assessment include whether any payment of principal or interest is overdue by more than
90 days, or there are known difficulties in the cash flows of counterparties, credit rating downgrades, or infringement of the original terms
of the contract. The Group addresses impairment assessment in two areas: individually assessed allowances and collectively assessed
allowances.

Individually assessed allowances

The Group determines the allowances appropriate for each individually significant loan or advance on an individual basis. Items considered
when determining allowance amounts include the sustainability of the counterparty’s business plan, its ability to improve performance once a
financial difficulty has arisen, projected receipts and the expected dividend payout should bankruptcy ensue, the availability of other financial
support and the realizable value of collateral, and the timing of the expected cash flows. The impairment losses are evaluated at each reporting
date, unless unforeseen circumstances require more careful attention.

Collectively assessed allowances

Allowances are assessed collectively for losses on loans and advances that are not individually significant (including residential mortgages and
unsecured consumer lending) and for individually significant loans and advances where there is no objective evidence of individual impairment
yet. Allowances are evaluated on each reporting date with each portfolio receiving a separate review.

The collective assessment takes account of impairment that is likely to be present in the portfolio even though there is no objective evidence
of the impairment yet per an individual assessment. Impairment losses are estimated by taking into consideration the following information:
historical losses on the portfolio, current economic conditions, the approximate delay between the time a loss is likely to have been incurred and
the time it will be identified as requiring an individually assessed impairment allowance, and expected receipts and recoveries once impaired.

Management is responsible for deciding the length of this period which can extend for as long as one year. The impairment allowance is then
reviewed by credit management to ensure alignment with the Group’s overall policy.

Market Risk
Market risk is the risk of loss that may result from changes in the value of a financial product. The Parent Company’s market risk originates from
its holdings of domestic and foreign-denominated debt securities, foreign exchange instruments, equities, foreign exchange derivatives and
interest rate derivatives.

China Bank 144 Annual Report 2016

The RMG of the Parent Company is responsible for assisting the RMC with its responsibility for identifying, measuring, managing and controlling
market risk. Market risk management measures the Parent Company market risk exposures through the use of VaR. VaR is a statistical measure
that estimates the maximum potential loss from a portfolio over a holding period, within a given confidence level.

VaR assumptions
The Parent Company calculates the Bankwide VaR in certain trading activities. The Parent Company uses the Historical Simulation Full Valuation
approach to measure VaR for all treasury traded instruments, using a 99% confidence level and a 1-day holding period.

The use of a 99% confidence level means that, within a one day horizon, losses exceeding the VaR figure should occur, on average, not more
than once every hundred days. The validity of the VaR model is verified through back testing, which examines how frequently actual and
hypothetical daily losses exceeds daily VaR. The Parent Company measures and monitors the VaR and profit and loss on a daily basis.

Since VaR is an integral part of the Parent Company’s market risk management, VaR limits have been established for all trading positions and
exposures are reviewed daily against the limits by management. Further, stress testing is performed for monitoring extreme events.

Limitations of the VaR Methodology

The VaR models are designed to measure market risk in a normal market environment using equally weighted historical data. The use of VaR has
limitations because it is based on historical correlations and volatilities in market prices and assumes that future price movements will follow the
same distribution. Due to the fact that VaR relies heavily on historical data to provide information and may not clearly predict the future changes
and modifications of the risk factors, the probability of large market moves may be underestimated if changes in risk factors fail to align with
the assumptions. VaR may also be under–or over–estimated due to the assumptions placed on risk factors and the relationship between such
factors for specific instruments. Even though positions may change throughout the day, the VaR only represents the risk of the portfolios at the
close of each business day, and it does not account for any losses that may occur beyond the 99% confidence level.

In practice, the actual trading results will differ from the VaR calculation and, in particular, the calculation does not provide a meaningful indication
of profits and losses in stressed market conditions. To determine the reliability of the VaR models, actual outcomes are monitored regularly to
test the validity of the assumptions and the parameters used in the VaR calculation. Market risk positions are also subject to regular stress tests
to ensure that the Group would withstand an extreme market event.

A summary of the VaR position of the trading portfolio of the Parent Company is as follows:

Foreign
Interest Rate1 Exchange2 Equity3 Interest Rate4 Interest Rate5
(In Millions)
2016
31 December P44.79 P24.31 P11.70 P6.17 P8.95
Average daily 52.60 7.79 18.43 3.72 1.82
Highest 109.59 29.59 53.39 10.12 9.17
Lowest 16.00 1.30 0.01 0.77 0.55

2015
31 December P29.09 P8.15 N/A P3.58 P1.14
Average daily 64.98 10.52 38.98 5.31 2.18
Highest 112.23 21.83 47.82 9.98 4.69
Lowest 29.09 3.94 1.32 2.49 1.05

1
Interest rate VaR for debt securities (Interest rate VaR for foreign currency denominated debt securities are translated to PHP using daily closing
rate)
2
FX VaR is the bankwide foreign exchange risk
3
No outstanding equity shares as of year-end
4
Interest rate VaR for FX swaps and FX forwards
5
Interest rate VaR for IRS

Interest Rate Risk

The Group’s interest rate risk originates from its holdings of interest rate sensitive assets and interest rate sensitive liabilities. The Parent
Company follows prudent policies in managing its exposures to interest rate fluctuations, and constantly monitors its assets and liabilities.

China Bank 145 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

As of December 31, 2016 and 2015, 51.89% and 58.48% of the Group’s total loan portfolio, respectively, comprised of floating rate loans
which are repriced periodically by reference to the transfer pool rate which reflects the Group’s internal cost of funds. In keeping with banking
industry practice, the Group aims to achieve stability and lengthen the term structure of its deposit base, while providing adequate liquidity to
cover transactional banking requirements of customers.

Interest is paid on demand accounts, which constituted 25.96% and 27.61% of total deposits of the Parent Company as of December 31,
2016 and 2015, respectively.

Interest is paid on savings accounts and time deposits accounts, which constitute 28.19% and 45.85%, respectively, of total deposits of the
Parent Company as of December 31, 2016, and 27.77% and 44.62%, respectively, as of December 31, 2015.

Savings account interest rates are set by reference to prevailing market rates, while interest rates on time deposits and special savings accounts
are usually priced by reference to prevailing rates of short-term government bonds and other money market instruments, or, in the case of
foreign currency deposits, inter-bank deposit rates and other benchmark deposit rates in international money markets with similar maturities.

The Group is likewise exposed to fair value interest rate risk due to its holdings of fixed rate government bonds as part of its AFS and FVPL
portfolios. Market values of these investments are sensitive to fluctuations in interest rates.

The following table provides for the average effective interest rates of the Group and of the Parent Company as of December 31, 2016 and
2015:

Consolidated Parent Company

2016 2015 2016 2015
Peso
Assets
Due from BSP 0.39% 0.29% 0.30% 0.26%
Due from banks 0.24% 0.80% 0.22% 0.25%
Investment securities* 4.00% 4.22% 3.95% 4.26%
Loans and receivables 5.65% 5.85% 5.34% 5.46%

Liabilities
Deposit liabilities 1.01% 0.92% 0.85% 0.73%
Bills payable 7.86% 4.12% 7.86% 5.13%

USD
Assets
Due from banks 0.11% 0.12% 0.08% 0.04%
Investment securities* 4.36% 4.66% 4.90% 4.71%
Loans and receivables 3.56% 3.03% 3.48% 2.98%

Liabilities
Deposit liabilities 1.23% 1.32% 1.24% 1.30%
Bills payable 1.94% 1.57% 1.91% 1.53%
* Consisting of financial assets at FVPL, AFS financial assets and HTM financial assets.

The asset-liability gap analysis method is used by the Group to measure the sensitivity of its assets and liabilities to interest rate fluctuations.
This analysis measures the Group’s susceptibility to changes in interest rates. The repricing gap is calculated by first distributing the assets
and liabilities contained in the Group’s balance sheet into tenor buckets according to the time remaining to the next repricing date (or the time
remaining to maturity if there is no repricing), and then obtaining the difference between the total of the repricing (interest rate sensitive) assets
and the total of repricing (interest rate sensitive) liabilities.

A gap is considered negative when the amount of interest rate sensitive liabilities exceeds the amount of interest rate sensitive assets. A gap is
considered positive when the amount of interest rate sensitive assets exceeds the amount of interest rate sensitive liabilities.

Accordingly, during a period of rising interest rates, a bank with a positive gap would be in a position to invest in higher yielding assets earlier
than it would need to refinance its interest rate sensitive liabilities. During a period of falling interest rates, a bank with a positive gap would
tend to see its interest rate sensitive assets repricing earlier than its interest rate sensitive liabilities, restraining the growth of its net income or
resulting in a decline in net interest income.

China Bank 146 Annual Report 2016

The following table sets forth the repricing gap position of the Group and Parent Company as of December 31, 2016 and 2015 (in millions):

Consolidated
2016
Up to 3 >3 to 12 >12
Months Months Months Total
Financial Assets
Due from BSP P91,964 P– P– P91,964
Due from other banks 11,332 – – 11,332
Investment securities 11,216 77 87,689 98,982
Loans and receivables 195,911 38,156 152,760 386,827
Total financial assets 310,423 38,233 240,449 589,105
Financial Liabilities
Deposit liabilities 236,806 15,099 289,678 541,583
Bills payable 13,685 2,718 552 16,955
Total financial liabilities 250,491 17,817 290,230 558,538
Repricing gap P59,932 P20,416 (P49,781) P30,567

Consolidated
2015
Up to 3 >3 to 12 >12
Months Months Months Total
Financial Assets
Due from BSP P86,319 P– P– P86,319
Due from other banks 21,243 – – 21,243
Investment securities 2,165 384 68,661 71,210
Loans and receivables 180,611 45,507 83,644 309,762
Total financial assets 290,338 45,891 152,305 488,534

Financial Liabilities
Deposit liabilities 178,913 14,027 246,326 439,266
Bills payable 7,383 2,042 9,660 19,085
Total financial liabilities 186,296 16,069 255,986 458,351
Repricing gap P104,042 P29,822 (P103,681) P30,183

Parent Company
2016
Up to 3 >3 to 12 >12
Months Months Months Total
Financial Assets
Due from BSP P85,307 P– P– P85,307
Due from other banks 9,689 – – 9,689
Investment securities 9,678 – 82,778 92,456
Loans and receivables 179,102 26,169 123,799 329,070
Total financial assets 283,776 26,169 206,577 516,522
Financial Liabilities
Deposit liabilities 199,467 12,083 259,412 470,962
Bills payable 13,685 2,718 552 16,955
Total financial liabilities 213,152 14,801 259,964 487,917
Repricing gap P70,624 P11,368 (P53,387) P28,605

China Bank 147 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Parent Company
2015
Up to 3 >3 to 12 >12
Months Months Months Total
Financial Assets
Due from BSP P77,004 P– P– P77,004
Due from other banks 19,201 – – 19,201
Investment securities 1,440 330 64,475 66,245
Loans and receivables 165,200 32,346 62,099 259,645
Total financial assets 262,845 32,676 126,574 422,095
Financial Liabilities
Deposit liabilities 147,010 8,728 217,865 373,603
Bills payable 7,377 2,039 9,007 18,423
Total financial liabilities 154,387 10,767 226,872 392,026
Repricing gap P108,458 P21,909 (P100,298) P30,069

The Group also monitors its exposure to fluctuations in interest rates by using scenario analysis to estimate the impact of interest rate movements
on its interest income. This is done by modeling the impact to the Group’s interest income and interest expenses to parallel changes in the
interest rate curve in a given 12-month period.

The following table sets forth the estimated change in the Group’s and Parent Company’s annualized net interest income due to a parallel
change in the interest rate curve as of December 31, 2016 and 2015:

Consolidated
2016
Change in interest rates (in basis points)
100bp rise 50bp rise 50bp fall 100bp fall
Change in annualized net interest income P752 P376 (P376) (P752)
As a percentage of the Group’s net interest income for
the year ended December 31, 2016 4.48% 2.24% (2.24%) (4.48%)

Consolidated
2015
Change in interest rates (in basis points)
100bp rise 50bp rise 50bp fall 100bp fall
Change in annualized net interest income P1,264 P632 (P632) (P1,264)
As a percentage of the Group’s net interest income for
the year ended December 31, 2015 8.38% 4.19% (4.19%) (8.38%)

Parent Company
2016
Change in interest rates (in basis points)
100bp rise 50bp rise 50bp fall 100bp fall
Change in annualized net interest income P791 P396 (P396) (P791)
As a percentage of the Parent Company’s net interest
income for the year ended December 31, 2016 5.70% 2.85% (2.85%) (5.70%)

Parent Company
2015
Change in interest rates (in basis points)
100bp rise 50bp rise 50bp fall 100bp fall
Change in annualized net interest income P1,249 P624 (P624) (P1,249)
As a percentage of the Parent Company’s net interest
income for the year ended December 31, 2015 10.08% 5.04% (5.04%) (10.08%)

China Bank 148 Annual Report 2016

The following table sets forth the estimated change in the Group’s and Parent Company’s income before tax and equity due to a reasonably
possible change in the market prices of quoted bonds classified under financial assets at FVPL and AFS financial assets, brought about by
movement in the interest rate curve as of December 31, 2016 and 2015 (in millions):

Consolidated
2016
Change in interest rates (in basis points)
25bp rise 10bp rise 10bp fall 25bp fall
Change in income before tax (P47) (P19) P19 P47
Change in equity (377) (151) 151 377

Consolidated
2015
Change in interest rates (in basis points)
25bp rise 10bp rise 10bp fall 25bp fall
Change in income before tax (P71) (P29) P29 P72
Change in equity (828) (334) 336 848

Parent Company
2016
Change in interest rates (in basis points)
25bp rise 10bp rise 10bp fall 25bp fall
Change in income before tax (P40) (P16) P16 P40
Change in equity (339) (136) 136 339

Parent Company
2015
Change in interest rates (in basis points)
25bp rise 10bp rise 10bp fall 25bp fall
Change in income before tax (P59) (P24) P24 P60
Change in equity (782) (315) 317 800

Foreign Currency Risk

The Group’s foreign exchange risk originates from its holdings of foreign currency-denominated assets (foreign exchange assets) and foreign
currency-denominated liabilities (foreign exchange liabilities).

Foreign exchange liabilities generally consist of foreign currency-denominated deposits in the Group’s FCDU account made in the Philippines
or generated from remittances to the Philippines by persons overseas who retain for their own benefit or for the benefit of a third party, foreign
currency deposit accounts with the Group.

Foreign currency liabilities are generally used to fund the Group’s foreign exchange assets which generally consist of foreign currency-
denominated loans and investments in the FCDU. Banks are required by the BSP to match the foreign currency-denominated assets with
liabilities held in the FCDU that are denominated in the same foreign currency. In addition, the BSP requires a 30.00% liquidity reserve on all
foreign currency-denominated liabilities held in the FCDU.

The Group’s policy is to maintain foreign currency exposure within existing regulations, and within acceptable risk limits. The Group believes in
ensuring its foreign currency is at all times within limits prescribed for financial institutions who are engaged in the same types of businesses in
which the Group and its subsidiaries are engaged.

China Bank 149 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

The table below summarizes the Group’s and Parent Company’s exposure to foreign exchange risk. Included in the table are the Group’s and
Parent Company’s assets and liabilities at carrying amounts (stated in US Dollars), categorized by currency:

Consolidated
2016 2015
Other Other
USD Currencies Total PHP USD Currencies Total PHP
Assets
Cash and other cash items $15,366 $2,781 $18,147 P896,335 $11,464 $2,854 $14,318 P674,996
Due from other banks 141,279 8,623 150,352 7,422,444 332,199 20,698 352,897 16,615,197
Financial assets at FVPL 95,587 7 95,594 4,752,967 81,763 1,417 83,180 3,915,125
AFS financial assets 460,901 − 460,901 22,859,924 492,412 − 492,412 23,172,924
HTM financial assets 702,957 8,560 711,517 35,252,391 315,835 2,932 318,767 14,966,432
Loans and receivables 658,657 913 659,570 32,771,104 720,262 986 721,248 33,942,299
Accrued interest receivable 18,691 55 18,746 929,765 18,280 217 18,497 870,570
Other assets 38,175 7 38,182 1,898,142 37,145 22 37,167 1,749,078
2,132,064 20,941 2,153,011 106,783,072 2,009,360 29,126 2,038,486 95,906,621
Liabilities
Deposit liabilities 1,631,011 18,875 1,649,886 81,835,829 1,405,689 18,222 1,423,911 67,017,476
Bills payables 341,865 − 341,865 16,997,522 392,872 − 392,872 18,488,559
Accrued interest and other
expenses 2,897 2 2,899 143,929 2,788 7 2,795 131,546
Other liabilities 60,462 840 61,302 2,981,638 53,478 830 54,308 2,556,035
2,036,235 19,717 2,055,952 101,958,918 1,854,827 19,059 1,873,886 88,193,616
Currency spot (3,027) 51 (2,976) (148,562) 8,000 − 8,000 376,480
Currency forwards (59,371) 10,790 (48,581) (2,414,102) (153,326) (4,345) (157,671) (7,422,016)
Net Exposure $32,980 $12,070 $45,050 P2,261,490 $9,207 $5,722 $14,929 P667,469

Parent Company
2016 2015
Other Other
USD Currencies Total PHP USD Currencies Total PHP
Assets
Cash and other cash items $13,224 $2,781 $16,005 P795,534 $10,287 $2,854 $13,141 P619,609
Due from other banks 121,834 8,623 130,457 6,486,192 314,210 20,698 334,908 15,768,625
Financial assets at FVPL 95,587 7 95,594 4,752,967 73,393 1,417 74,810 3,521,218
AFS financial assets 439,821 − 439,821 21,867,906 477,612 − 477,612 22,476,428
HTM financial assets 670,955 8,560 679,515 33,746,382 294,301 2,932 297,233 13,953,016
Loans and receivables 650,077 913 650,990 32,367,332 710,627 986 711,613 33,488,871
Accrued interest receivable 17,827 55 17,882 889,109 17,543 217 17,760 835,871
Other assets 38,098 7 38,105 1,894,483 34,213 22 34,235 1,611,107
2,047,423 20,946 2,068,370 102,799,905 1,932,186 29,126 1,961,312 92,274,745
Liabilities
Deposit liabilities 1,557,612 18,875 1,576,487 78,381,671 1,343,583 18,222 1,361,805 64,094,780
Bills payables 341,865 − 341,865 16,997,522 392,872 − 392,872 18,488,559
Accrued interest and other
expenses 2,825 2 2,827 140,518 2,682 7 2,689 126,557
Other liabilities 54,153 840 54,993 2,684,710 46,024 830 46,854 2,205,239
1,956,455 19,717 1,976,172 98,204,421 1,785,161 19,059 1,804,220 84,915,135
Currency spot (3,027) 51 (2,976) (148,562) 8,000 − 8,000 376,480
Currency forwards (59,371) 10,790 (48,581) (2,414,102) (153,326) (4,345) (157,671) (7,422,016)
Net Exposure $28,570 $12,070 $40,640 P2,032,020 $1,699 $5,722 $7,421 P314,074

China Bank 150 Annual Report 2016

The following table sets forth, for the period indicated, the impact of the range of reasonably possible changes in the US$ exchange rate and
other currencies per Philippine peso on the pre-tax income and equity (in millions).

Consolidated
Change in
Foreign Sensitivity of Sensitivity of
Exchange Rate Pretax Income Equity
2016
USD 2% P54 P164
Other 1% − −
USD (2%) (54) (164)
Other (1%) − −

2015
USD 2% 83 547
Other 1% 1 1
USD (2%) (83) (547)
Other (1%) (1) (1)

Parent Company
Change in
Foreign Sensitivity of Sensitivity of
Exchange Rate Pretax Income Equity
2016
USD 2% P51 P143
Other 1% − −
USD (2%) (51) (143)
Other (1%) − −

2015
USD 2% 75 525
Other 1% 1 1
USD (2%) (75) (525)
Other (1%) (1) (1)

The impact in pre-tax income and equity is due to the effect of foreign currency behaviour to Philippine peso.

Equity Price Risk

Equity price risk is the risk that the fair values of equities change as a result of movements in both the level of equity indices and the value of
individual stocks. The non-trading equity price risk exposure arises from the Group’s investment portfolio.

The effect on the Group and Parent Company’s equity as a result of a change in the fair value of equity instruments held as AFS due to a
reasonably possible change in equity indices, with all other variables held constant, is as follows (in millions):

Consolidated
Change in Effect on
equity index Equity
2016 +10% P19.8
-10% 12.1
2015 +10% 10.6
-10% (41.0)

China Bank 151 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Parent Company
Change in Effect on
equity index Equity
2016 +10% P19.8
-10% 12.1
2015 +10% 10.6
-10% (41.0)

Liquidity Risk and Funding Management

Liquidity risk is generally defined as the current and prospective risk to earnings or capital arising from the Parent Company’s inability to meet
its obligations when they become due without incurring unacceptable losses or costs.

The Parent Company’s liquidity management involves maintaining funding capacity to accommodate fluctuations in asset and liability levels due
to changes in the Parent Company’s business operations or unanticipated events created by customer behavior or capital market conditions.
The Parent Company seeks to ensure liquidity through a combination of active management of liabilities, a liquid asset portfolio composed of
deposits reserves and high quality securities, the securing of money market lines, and the maintenance of repurchase facilities to address any
unexpected liquidity situations.

The table below shows the maturity profile of the Parent Company’s assets and liabilities, based on contractual undiscounted cash flows
(in millions):

December 31, 2016

Less than
On demand 1 year 1 to 2 years 2 to 3 years 3 to 5 years Total
Financial Assets
Cash and other cash items P10,581 P− P− P− P− P10,581
Due from BSP 85,307 − − − − 85,307
Due from other banks 9,689 − − − − 9,689
Interbank loans receivable and SPURA − 2,958 − − − 2,958
Financial assets at FVPL − 583 326 1,484 5,400 7,793
AFS financial assets − 12,192 1,676 3,705 19,709 37,282
Loans and receivables − 141,925 17,948 21,115 195,228 376,216
105,577 157,658 19,950 26,304 220,337 529,826
Financial Liabilities
Deposit liabilities
Demand 122,266 − − − − 122,266
Savings 132,772 − − − − 132,772
Time − 211,755 3,440 724 962 216,881
Bills payable − 9,236 7,813 − − 17,049
Manager’s checks − 1,446 − − − 1,446
Accrued interest and other expenses − 578 − − − 758
Derivative liabilities − 243 − − − 243
Other liabilities: − − − −
Accounts payable − 1,731 − − − 1,731
Acceptances payable − 1,172 − − − 1,172
Due to PDIC − 428 − − − 428
Margin deposits − 2 − − − 2
Other credits - dormant − 304 − − − 304
Due to the Treasurer of the Philippines − 24 − − − 24
Miscellaneous − 429 − − − 289
Total liabilities 255,038 227,348 11,253 724 962 495,325
Net Position (P149,461) (P69,690) P8,697 P25,580 P219,375 P34,501

China Bank 152 Annual Report 2016

 December 31, 2015
Less than
On demand 1 year 1 to 2 years 2 to 3 years 3 to 5 years Total
Financial Assets
Cash and other cash items P10,053 P− P− P− P− P10,053
Due from BSP 77,004 − − − − 77,004
Due from other banks 19,201 − − − 19,201
Financial assets at FVPL − 284 179 237 5,035 5,735
AFS financial assets − 3,386 3,042 3,032 53,207 62,667
Loans and receivables − 143,283 27,523 26,998 104,990 302,794
106,258 146,953 30,744 30,267 163,232 477,454
Financial Liabilities
Deposit liabilities
Demand 103,025 − − − − 103,025
Savings 104,137 − − − − 104,137
Time − 154,580 1,187 3,212 8,522 167,501
Bills payable − 11,291 − 7,369 − 18,660
Manager’s checks − 741 − − − 741
Accrued interest and other expenses − 355 − − − 355
Derivative liabilities − 66 − − − 66
Other liabilities:
Accounts payable − 1,262 − − − 1,262
Acceptances payable − 997 − − − 997
Due to PDIC − 346 − − − 346
Margin deposits − 3 − − − 3
Other credits - dormant − 214 − − − 214
Due to the Treasurer of the Philippines − 96 − − − 96
Miscellaneous − 419 − − − 419
Total liabilities 207,162 170,370 1,187 10,581 8,522 397,822
Net Position (P100,904) (P23,417) P29,557 P19,686 P154,710 P79,632

Liquidity risk is monitored and controlled primarily by a gap analysis of maturities of relevant assets and liabilities reflected in the MCO report,
as well as an analysis of available liquid assets. Instead of relying solely on contractual maturities profile, the Parent Company uses Behavioral
MCO to capture a going concern view. Furthermore, internal liquidity ratios and monitoring of large funds providers have been set to determine
sufficiency of liquid assets over deposit liabilities. In 2016, the Bank started submitting quarterly Liquidity Coverage Ratio as prescribed by
the BSP for a 2 year observation period. Liquidity is managed by the Parent and subsidiaries on a daily basis, while scenario stress tests are
conducted periodically.

7. DUE FROM BSP AND OTHER BANKS

Due from BSP

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Demand deposit account P84,480,394 P68,886,859 P78,773,027 P61,433,089
Special deposit account 7,450,000 17,291,115 6,500,000 15,430,000
Others 34,101 140,527 34,101 140,527
P91,964,495 P86,318,501 P85,307,128 P77,003,616

China Bank 153 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Due from Other Banks

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Local banks P6,296,727 P12,237,681 P4,747,467 P10,859,956
Foreign banks 5,035,509 9,005,811 4,941,698 8,340,588
P11,332,236 P21,243,492 P9,689,165 P19,200,544

Interest Income on Due from BSP and Other Banks

This account consists of:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Due from BSP P497,571 P220,406 P554,802 P440,260 P159,792 P432,703
Due from other banks 221,843 95,399 146,340 115,528 22,870 32,386
P719,414 P315,805 P701,142 P555,788 P182,662 P465,089

8. TRADING AND INVESTMENT SECURITIES

Financial Assets at FVPL

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Held for trading
Government bonds (Note 27) P2,404,049 P1,386,524 P2,240,488 P992,617
Treasury notes 1,031,675 1,106,252 724,219 720,983
Treasury bills 994,203 595,351 994,203 595,351
Private bonds 594,798 556,570 594,798 556,570
5,024,725 3,644,697 4,553,708 2,865,521
Financial assets designated at FVPL 2,462,886 2,299,970 2,462,886 2,299,970
Derivative assets (Note 24) 216,288 299,926 216,288 299,926
Total P7,703,899 P6,244,593 P7,232,882 P5,465,417

Financial assets designated at FVPL of the Parent Company consist of investments in shares of stocks which contain multiple embedded
derivatives which are deemed not clearly and closely related to its equity host. In this regard, PAS 39 provides that if a contract contains one or
more embedded derivatives, an entity may designate the entire hybrid contract at FVPL unless the embedded derivative does not significantly
modify the cash flows that otherwise would be required by the contract, or it is clear with little or no analysis when a similar hybrid instrument
is first considered that separation of the embedded derivative is prohibited. On this basis, management has determined that the investments
shall be designated as at FVPL.

Dividends earned by the Parent Company from its investment in shares designated at FVPL amounted to P182.13 million, P247.10 million and
P301.58 million in 2016, 2015 and 2014, respectively (Note 20).

As of December 31, 2016 and 2015, HFT securities include fair value loss of P63.97 million and P14.47 million, respectively, for the Group, and
fair value loss of P51.06 million and P16.89 million, respectively, for the Parent Company. Both realized and unrealized gains and losses on HFT
and financial assets designated at FVPL are included under ‘Trading and securities gain - net’ (Note 20).

China Bank 154 Annual Report 2016

Effective interest rates for Philippine peso-denominated financial assets at FVPL for both the Group and the Parent Company range from 2.08%
to 6.88% in 2016, and from 1.63% to 13.75% in 2015 and 2014. Effective interest rates for foreign currency–denominated financial assets at
FVPL for the Group range from 0.99% to 7.24% in 2016, and from 1.37% to 10.63% in 2015 and 2014.

Effective interest rates for foreign currency-denominated financial assets at FVPL for the Parent Company range from 0.99% to 6.80% in 2016,
from 2.50% to 10.63% in 2015, and from 2.75% to 10.63% in 2014.

AFS Financial Assets

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Quoted
Government bonds (Notes 17 and 27) P22,337,592 P40,193,418 P20,561,662 P38,663,049
Private bonds 11,417,612 8,213,921 10,491,728 7,766,369
Equities 80,947 111,470 80,947 111,470
33,836,150 48,518,809 31,134,337 46,540,888
Unquoted
Private bonds and commercial papers - net − 290,256 − 273,898
Equities - net * 37,572 20,168 19,413 19,413
37,572 310,424 19,413 293,311
Total P33,873,722 P48,829,233 P31,153,750 P46,834,199
* Includes fully impaired equity investments with acquisition cost of P 38.74 million for the Group and P 6.32 million for the Parent Company as
of December 31,2016 and 2015.

Unquoted equity securities

This account comprises of shares of stocks of various unlisted private corporations.

Net unrealized gains (losses)

AFS financial assets include fair value losses of P1.47 billion and P1.32 billion for the Group and Parent Company, respectively, as of
December 31, 2016, and fair value losses of P1.13 billion for the Group and Parent Company, as of December 31, 2015. The fair value gains
or losses are recognized under OCI. Impairment loss on AFS financial assets of the Group, which was charged to operations, amounted to
P0.06 million in 2015. No impairment loss was recognized in 2016 and 2014.

Effective interest rates for peso-denominated AFS financial assets for the Group range from 1.34% to 7.00% in 2016, from 2.14% to 7.25% in
2015 and from 1.63% to 8.92% 2014. Effective interest rates for peso-denominated AFS financial assets for the Parent Company range from
2.08% to 7.00% in 2016, from 2.14% to 7.25% in 2015 and from 1.63% to 8.92% 2014.

Effective interest rates for foreign currency-denominated AFS financial assets for both the Group and Parent Company range from 0.37% to
7.45% in 2016, from 1.50% to 7.45% in 2015, and from 1.50% to 5.71% in 2014.

HTM Financial Assets

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Government bonds (Note 17) P38,610,521 P12,891,098 P36,243,699 P11,306,923
Private bonds 12,180,159 2,806,247 11,530,159 2,356,247
50,790,680 15,697,345 47,773,858 13,663,170
Unamortized premium - net 6,614,120 438,802 6,295,163 282,475
P57,404,800 P16,136,147 P54,069,021 P13,945,645

Effective interest rates for peso-denominated HTM financial assets for the Group range from 2.05% to 6.63% in 2016, from 1.35% to 9.13% in
2015 and from 2.15% to 9.13% in 2014. Effective interest rates for foreign currency-denominated HTM financial assets range from 0.21% to
8.93% in 2016, from 2.26% to 10.72% in 2015, and from 3.11% to 11.55% in 2014.

China Bank 155 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Effective interest rates for peso-denominated HTM financial assets of the Parent Company range from 2.82% to 5.25% in 2016 and from 4.13%
to 9.13% in 2015 and 2014. Effective interest rates for foreign currency-denominated HTM financial assets range from 0.21% to 8.93% in 2016,
from 2.26% to 10.72% in 2015, and from 4.61% to 11.55% in 2014.

Reclassification of Financial Assets

2016 Reclassification
The Group transferred certain securities from AFS financial assets to HTM financial assets on various dates ranging from November 11 to 21,
2016 (reclassification date). The decision to effect this transfer was reached by balancing the need to reduce the market risk sensitivity of the
balance sheet without reducing the portfolio of liquid assets.

Details of reclassified financial assets follows:

Consolidated
Carrying Unamortized
Value at Net Unrealized
Reclassification Carrying Fair Loss Deferred
Face Value Date Value Value in Equity Amortization
(in original currency)
Philippine peso denominated
government bonds P10,106,378 P11,874,068 P11,032,214 P10,855,315 (P591,635) P5,052
US dollar denominated
government bonds USD103,371 136,735 128,776 127,305 (6,731) 56

Parent
Carrying Unamortized
Value at Net Unrealized
Reclassification Carrying Fair Loss Deferred
Face Value Date Value Value in Equity Amortization
(in original currency)
Philippine peso denominated
government bonds P9,856,378 P11,588,081 P10,758,190 P10,586,090 (P579,859) P4,964
US dollar denominated
government bonds USD96,871 127,088 120,063 118,776 (5,812) 52

Had these securities not been transferred to HTM, additional fair value loss that would have been charged against the statement of comprehensive
income amounted to P768.82 million and P752.26 million in 2016 on Philippine peso denominated government bonds for the Group and the
Parent Company, respectively. Additional fair value loss of USD8.21 million (P408.20 million) and USD7.11 million (P353.51 million) would have
been charged against to the statement of comprehensive income in 2016 on US dollar denominated government bonds for the Group and
Parent Company, respectively.

The effective interest rates on the reclassified assets at reclassification dates range from 3.28% to 5.06% and 4.06% to 5.06% for Philippine
peso denominated government bonds for the Group and Parent Company, respectively. The effective interest rates on the transferred assets
range from 1.77% to 4.16% for US dollar denominated bonds at the time of their reclassification for both the Group and Parent Company. The
Group and Parent Company expect to recover 100% of the principal and the interest due on these transferred assets. These securities are
also unimpaired as of December 31, 2016.

Fair value changes taken to OCI in 2016 for these reclassified securities amounted to P584.82 million and USD4.99 million for Philippine peso
denominated and US dollar denominated government bonds, respectively.

2008 Reclassification
In 2008, as approved by its BOD, the Parent Company identified assets for which it had a clear change of intent to hold the investments to
maturity rather than to exit or trade these investments in the foreseeable future and reclassified those investments from AFS financial assets to
HTM financial assets effective October 2, 2008.

As of October 2, 2008, the total carrying value of AFS financial assets reclassified to HTM financial assets amounted to P9.04 billion, with
unrealized losses of P47.44 million deferred under ‘Net unrealized gains (losses) on AFS financial assets’. HTM financial assets reclassified from
AFS financial assets with total face amount of P1.57 billion and P244.24 million matured in 2016 and 2015, respectively.

China Bank 156 Annual Report 2016

 As of December 31, 2016 and 2015, HTM financial assets reclassified from AFS financial assets have the following balances:

Unamortized
Net Unrealized
Original Carrying Fair Deferred
Face Value Cost Value Value in Equity Amortization
2016
Government bonds* P1,284,516 P1,553,572 P1,311,014 P1,367,155 (P8,127) P6,496
Private bonds**
P1,284,516 P1,553,572 P1,311,014 P1,367,155 (P8,127) P6,496
2015
Government bonds* P2,325,370 P2,637,212 P2,390,697 P2,771,976 (P1,088) (P35,901)
Private bonds** 378,362 378,344 375,305 393,996 (3,055) 19,628
P2,703,732 P3,015,556 P2,766,002 P3,165,972 (P4,143) (P16,273)
* Consist of US dollar-denominated bonds with face value of $25.84 million and $46.44 million as of December 31, 2016 and 2015, respectively, and euro-
denominated bonds with face value of €2.71 million as of December 31, 2015.
** Consist of US dollar-denominated bonds with face value of $35.0 million and $8.04 million as of December 31, 2016 and 2015, respectively.

Had these securities not been reclassified to HTM financial assets, additional fair value gain that would have been credited to the statement
of comprehensive income amounted to P47.93 million, P395.74 million, and P324.67 million in 2016, 2015 and 2014, respectively. Effective
interest rates on the reclassified securities range from 6.16% to 8.93%. The Parent Company expects to recover 100.00% of the principal and
interest due on the reclassified investments. No impairment loss was recognized on these securities in 2016, 2015 and 2014.

Interest Income on Trading and Investment Securities

This account consists of:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Financial assets at FVPL P204,882 P262,027 P277,144 P179,406 P232,464 P239,537
AFS financial assets 1,538,173 1,840,978 1,776,157 1,439,037 1,785,184 1,683,205
HTM financial assets 1,539,908 997,797 968,485 1,441,882 929,266 949,382
P3,282,963 P3,100,802 P3,021,786 P3,060,325 P2,946,914 P2,872,124

9. LOANS AND RECEIVABLES

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Loans and discounts
Corporate and commercial lending P319,733,478 P255,950,751 P288,122,032 P225,505,499
Consumer lending 60,416,106 48,012,782 35,409,327 29,240,653
Trade-related lending 13,045,531 12,750,550 11,376,697 11,147,748
Others* 543,021 320,699 68,870 71,514
393,738,136 317,034,782 334,976,926 265,965,414
Unearned discounts (255,841) (278,335) (198,042) (168,620)
393,482,295 316,756,447 334,778,884 265,796,794
Allowance for impairment and credit losses (Note 15) (6,654,995) (6,994,670) (5,709,025) (6,151,786)
P386,827,300 P309,761,777 P329,069,859 P259,645,008
*Others include employee loans and foreign bills purchased.

China Bank 157 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

The Group’s and Parent Company’s loans and discounts under corporate and commercial lending include unquoted debt securities
with carrying amount of P4.08 billion and P3.98 billion as of December 31, 2016, respectively, and P1.37 billion and P1.00 billion as of
December 31, 2015, respectively.

Outstanding loans of the Group and the Parent Company amounting to P760.38 billion and P0.21 million, respectively, in 2015, are funded by
relending facilities with local government agencies (Note 17).

BSP Reporting
Information on the amounts of secured and unsecured loans and receivables (gross of unearned discounts and allowance for impairment and credit losses)
of the Group and Parent Company are as follows:

Consolidated Parent Company

2016 2015 2016 2015
Amounts % Amounts % Amounts % Amounts %
Loans secured by
Real estate P55,840,410 14.18 P64,153,568 20.23 P33,443,459 9.98 P41,243,643 15.51
Chattel mortgage 29,496,094 7.49 26,271,491 8.29 19,713,062 5.88 19,272,656 7.25
Deposit hold out 3,806,062 0.97 3,710,591 1.17 2,251,423 0.67 1,764,664 0.66
Shares of stock of other banks 2,710,000 0.69 4,948,073 1.56 2,710,000 0.81 4,948,073 1.86
Guarantee by the Republic of
the Philippines 8,487,000 2.16 9,153,000 2.89 8,487,000 2.53 9,153,000 3.44
Others 76,814,028 19.49 24,504,252 7.73 73,171,797 21.86 22,018,279 8.28
177,153,594 44.98 132,740,975 41.87 139,776,741 41.73 98,400,315 37.00
Unsecured loans 216,584,543 55.02 184,293,807 58.13 195,200,185 58.27 167,565,099 63.00
P393,738,136 100.00 P317,034,782 100.00 P334,976,926 100.00 P265,965,414 100.00

Information on the concentration of credit as to industry of the Group and Parent Company follows:

Consolidated
2016 2015
Amounts % Amounts %
Real estate, renting and business services P97,201,490 24.69 P73,904,956 23.31
Wholesale and retail trade 57,498,702 14.60 45,524,686 14.36
Financial intermediaries 40,750,252 10.35 22,164,997 6.99
Electricity, gas and water 40,385,429 10.26 26,924,936 8.49
Transportation, storage and communication 33,885,852 8.61 23,046,395 7.27
Manufacturing 27,602,087 7.01 37,854,608 11.94
Construction 10,167,766 2.58 9,973,878 3.15
Accommodation and food service activities 8,227,872 2.09 5,953,404 1.88
Public administration and defense 7,544,000 1.92 8,200,000 2.59
Arts, entertainment and recreation 7,511,725 1.91 7,603,811 2.40
Agriculture 5,782,267 1.47 6,100,963 1.92
Professional, scientific and technical activities 5,760,184 1.46 7,563,543 2.39
Education 3,819,309 0.97 4,312,472 1.36
Mining and quarrying 1,419,481 0.36 1,479,981 0.47
Others* 46,181,720 11.73 36,426,152 11.48
P393,738,136 100.00 P317,034,782 100.00
*Others consist of administrative and support service, health, household and other activities.

China Bank 158 Annual Report 2016

 Parent Company
2016 2015
Amounts % Amounts %
Real estate, renting and business services P76,873,563 22.95 P57,640,859 21.67
Wholesale and retail trade 49,143,056 14.67 38,336,067 14.41
Electricity, gas and water 40,103,651 11.97 26,653,354 10.02
Financial intermediaries 37,826,049 11.29 19,014,800 7.15
Transportation, storage and communication 31,858,356 9.51 21,288,949 8.00
Manufacturing 23,465,857 7.01 33,704,510 12.67
Construction 8,829,298 2.64 8,490,130 3.19
Public administration and defense 7,544,000 2.25 8,200,000 3.08
Arts, entertainment and recreation 7,470,098 2.23 7,570,591 2.85
Accommodation and food service activities 6,511,668 1.94 4,310,755 1.62
Professional, scientific and technical activities 5,318,354 1.59 7,397,503 2.78
Agriculture 3,762,789 1.12 4,076,266 1.53
Education 2,807,735 0.84 3,424,162 1.29
Mining and quarrying 1,257,731 0.38 1,479,981 0.56
Others* 32,204,721 9.61 24,377,487 9.18
P334,976,926 100.00 P265,965,414 100.00
*Others consist of administrative and support service, health, household and other activities.

The BSP considers that loan concentration exists when the total loan exposure to a particular industry or economic sector exceeds 30.00%
of total loan portfolio. As of December 31, 2016 and 2015, the Parent Company does not have credit concentration in any particular industry.

As of December 31, 2016 and 2015, secured and unsecured non-performing loans (NPLs) of the Group and the Parent Company follow:

Consolidated Parent Company

2016 2015 2016 2015
Secured P3,038,413 P4,125,042 P1,086,882 P1,741,816
Unsecured 4,274,659 3,884,797 2,642,103 3,256,796
P7,313,072 P8,009,839 P3,728,985 P4,998,612

Generally, NPLs refer to loans whose principal and/or interest is unpaid for thirty (30) days or more after due date or after they have become
past due in accordance with existing BSP rules and regulations. This shall apply to loans payable in lump sum and loans payable in quarterly,
semi-annual, or annual installments, in which case, the total outstanding balance thereof shall be considered nonperforming.

In the case of loans that are payable in monthly installments, the total outstanding balance thereof shall be considered nonperforming when
three (3) or more installments are in arrears.

In the case of loans that are payable in daily, weekly, or semi-monthly installments, the total outstanding balance thereof shall be considered
nonperforming at the same time that they become past due in accordance with existing BSP regulations, i.e., the entire outstanding balance of
the receivable shall be considered as past due when the total amount of arrearages reaches twenty percent (20.00%) of the total loan balance.

Loans are classified as nonperforming in accordance with BSP regulations, or when, in the opinion of management, collection of interest
or principal is doubtful. Loans are not reclassified as performing until interest and principal payments are brought current or the loans are
restructured in accordance with existing BSP regulations, and future payments appear assured.

Loans which do not meet the requirements to be treated as performing loans shall also be considered as NPLs. Gross and net NPLs of the
Parent Company as reported to BSP amounted to P3.73 billion and P1.42 billion, respectively, in 2016 and P5.00 billion and P1.82 billion,
respectively, in 2015. Gross and net NPL ratios of the Parent Company are 1.12% and 0.43%, respectively, in 2016 and 1.89% and 0.69%,
respectively, in 2015.

China Bank 159 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Interest Income on Loans and Receivables

This account consists of:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Receivables from customers P17,812,793 P15,813,206 P14,515,093 P14,055,123 P12,257,457 P11,158,515
Unquoted debt securities 76,459 87,521 159,118 67,164 67,502 136,901
P17,889,252 P15,900,727 P14,674,211 P14,122,287 P12,324,959 P11,295,416

As of December 31, 2016 and 2015, 52.53% and 58.86%, respectively, of the total receivables from customers of the Group were subject to
interest repricing. As of December 31, 2016 and 2015, 53.29% and 62.10%, respectively, of the total receivables from customers of the Parent
Company were subject to interest repricing. Remaining receivables carry annual fixed interest rates ranging from 1.00% to 11.00% in 2016,
from 1.82% to 8.00% in 2015, and from 0.98% to 10.50% in 2014 for foreign currency-denominated receivables and from 1.00% to 30.00%
in 2016 and 2015, and from 1.25% to 29.00% in 2014 for peso-denominated receivables.

10. EQUITY INVESTMENTS

This account consists of investments in:

Parent Company
December 31 December 31 January 1
2016 2015 2015
Investment cost
Subsidiaries
CBSI P12,165,984 P9,665,532 P2,986,311
PDB (merged with CBSI in 2015) − − 2,976,700
CBCC 500,000 300,000 −
CBC Forex Corporation − 50,000 50,000
CBC-PCCI 2,439 2,439 2,439
CIBI 1,500 1,500 1,500
12,669,923 10,019,471 6,016,950
Associate
Manulife China Bank Life Assurance Corporation (MCB Life) 166,273 166,273 166,273
12,836,196 10,185,744 6,183,223

Accumulated equity in net income (loss)

Balance at beginning of the year (417,732) (177,939) 192,098
Share in net income (loss)
Subsidiaries 464,999 (201,900) (369,125)
Associate (89,384) (37,893) (912)
375,615 (239,793) (370,037)
Balance at end of the year (42,117) (417,732) (177,939)

Equity in net unrealized loss on measurement of retirement plan and

translation adjustment and others
Subsidiaries (213,661) (126,068) (69,223)
Associate (134,823) (129,367) (5,970)
(348,484) (255,435) (75,193)

Carrying value
Subsidiaries 12,169,037 9,141,177 5,397,402
Associate 276,559 371,399 532,689
P12,445,596 P9,512,576 P5,930,091

China Bank 160 Annual Report 2016

 Parent Company
December 31, December 31,
2016 2015 January 1, 2015
Investment cost
Subsidiaries
CBSI P12,165,984 P9,665,532 P2,986,311
PDB (merged with CBSI in 2015) 2,976,700
CBCC 500,000 300,000 −
CBC Forex Corporation − 50,000 50,000
CBC-PCCI 2,439 2,439 2,439
CIBI 1,500 1,500 1,500
12,669,923 10,019,471 6,016,950
Associate
Manulife China Bank Life Assurance Corporation (MCB Life) 166,273 166,273 166,273
12,836,196 10,185,744 6,183,223

Accumulated equity in net income (loss)

Balance at beginning of the year (417,732) (177,939) 192,098
Share in net income (loss)
Subsidiaries 464,999 (201,900) (369,125)
Associate (89,384) (37,893) (912)
375,615 (239,793) (370,037)
Balance at end of the year (42,117) (417,732) (177,939)

Equity in net unrealized loss on measurement of retirement plan and

translation adjustment and others
Subsidiaries (213,661) (126,068) (69,223)
Associate (134,823) (129,367) (5,970)
(348,484) (255,435) (75,193)

Carrying value
Subsidiaries 12,169,037 9,141,177 5,397,402
Associate 276,559 371,399 532,689
P12,445,596 P9,512,576 P5,930,091

CBSI
Cost of investment includes the original amount incurred by the Parent Company from its acquisition of CBSI in 2007 amounting to
P1.07 billion, additional acquisition of non-controlling interest in 2015 of P2.52 million, capital infusion of P1.5 billion, P1.0 billion, and P2.0 billion
on December 31, 2016, September 29, 2016, and December 16, 2015, respectively, and P4.68 billion worth of CBSI common shares received
in connection with the merger of CBSI and PDB on December 31, 2015.

The capital infusions to CBSI were approved by the Parent Company’s Executive Committee on December 1, 2016, September 21, 2016,
and December 16, 2016. The December 16, 2015 infusion was made to comply with the BSP’s mandate for the final approval of the merger
between CBSI and PDB.

Merger of CBSI with PDB

The BOD of both CBSI and PDB, in their meeting held on June 26, 2014, approved the proposed merger of PDB with CBSI, with the latter as
the surviving bank. The terms of the Plan of Merger of CBSI with PDB were approved by CBSI and PDB’s stockholders owning at least 2/3 of
each corporation’s outstanding common stocks in separate meetings held on August 14, 2014. The Plan of Merger permits the issuance of
1.23 PDB common shares for every CBSI common share.

On November 6, 2015, the BSP issued the Certificate of Authority on the Articles of Merger and the Plan of Merger, as amended, of CBSI
and PDB.

China Bank 161 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

On December 17, 2015, CBSI obtained SEC’s approval of its merger with PDB, whereby the entire assets and liabilities of PDB shall be
transferred to and absorbed by CBSI.

Acquisition of PDB
In 2014, the Parent Company made tender offers to non-controlling stockholders of PDB. As of December 31, 2014, the Parent Company
owns 99.85% and 100.00% of PDB’s outstanding common and preferred stocks, respectively.

As of December 31, 2014, the Parent Company’s cost of investment in PDB consists of:

Acquisition of majority of PDB’s capital stock P1,421,346

Additional capital infusion 1,300,000
Tender offers 255,354
P2,976,700

On March 31, 2015, the Parent Company made additional capital infusion to PDB amounting to P1.70 billion. Of the total cost of investment,
the consideration transferred for the acquisition of PDB follows:

Acquisition of majority of PDB’s capital stock P1,421,346

Tender offers 255,354
P1,676,700

In 2015, the MB of the BSP granted to the Group investment and merger incentives in the form of waiver of special licensing fees for 67
additional branch licenses in restricted areas. This is in addition to the initial investment and merger incentives of 30 new branches in
restricted areas and 35 branches to be transferred from unrestricted to restricted areas granted to the Parent Company by the MB in 2014.
These branch licenses were granted under the Strengthening Program for Rural Bank (SPRB) Plus Framework.

The branch licenses have the following fair values:

As restated
114 Commercial Bank branch licenses P2,280,000
18 Thrift Bank branch licenses 270,000
2,550,000
Deferred tax liability 765,000
P1,785,000

On April 6, 2016, the Parent Company’s BOD has approved the allocation of the 67 additional branch licenses in restricted areas as follows: 49
to the Parent Company and 18 to CBSI.  Pursuant to memorandum dated March 18, 2016, the 67 branch licenses were awarded as incentives
by the Monetary Board as a result of the Parent Company’s acquisition of PDB. Goodwill from acquisition of PDB is computed as follows:

As restated
Consideration transferred P1,676,700
Less: Fair value of identifiable assets and liabilities acquired
Net liabilities of PDB (P725,207)
Branch licenses, net of deferred tax liability (Note 13) 1,785,000 1,059,793
P616,907

In 2014, acquisition-related costs amounting to P6.39 million are included under various operating expenses in the statements of income.

Since the acquisition date, the amounts of revenue and net losses of PDB included in the consolidated statements of income for the year ended
December 31, 2014 amounted to P2.78 billion and P265.49 million, respectively.

Had the acquisition of PDB occurred at the beginning of 2014, the Group’s revenue and net income for the year ended December 31, 2014
would have increased by P215.24 million and decreased by P158.32 million, respectively.

China Bank 162 Annual Report 2016

Cash flow on acquisition follows:

Cash and cash equivalents acquired from PDB* P5,728,617

Less: Cash paid 1,676,700
Net cash inflow P4,051,917
* Includes cash and other cash items, due from BSP and other banks.

CBCC
On April 1, 2015, the BOD approved the investment of the Parent Company in an investment house subsidiary, China Bank Capital Corporation
(CBCC), up to the amount of P500.00 million, subject to the requirements of relevant regulatory agencies.

On April 30, 2015, the BSP approved the request of the Parent Company to invest up to 100% or up to P500.00 million common shares in
CBCC, subject to certain conditions.

On November 27, 2015, the SEC approved the Articles of Incorporation and By-Laws of CBCC. It also granted CBCC the license to operate
as an investment house.

In 2016 and 2015, actual capital infusion to CBCC amounted to P200.00 million and P300.00 million, respectively.

CBC Assets One, Inc.

CBC Assets One, Inc. was incorporated on June 15, 2016 as a wholly-owned special purpose company of CBCC for asset-backed securitization.
It has not yet commenced commercial operations.

CBC Forex Corporation

On May 5, 2009, the BOD approved to dissolve the operations of CBC Forex by shortening its corporate life until December 31, 2009.
On December 28, 2015, the Parent Company obtained the approval from the SEC of its Certificate of Filing of Amended Articles of
Incorporation (Amending the Article IV by shortening the term of its existence, thereby dissolving the Corporation) dated November 6, 2015.
On December 19, 2016, the Parent Company’s investment with CBC Forex Corporation amounting P50.0 million was liquidated.

Investment in Associates
Investment in associates in the consolidated and Parent Company’s financial statements pertain to investment in MCB Life and CBC-PCCI’s
investment in Urban Shelters (accounted for by CBC-PCCI in its financial statements as an investment in an associate) which is carried at nil
amount as of December 31, 2016 and 2015.

The following table shows the summarized financial information of MCB Life:

2016 2015
Total assets P26,419,046 P21,439,732
Total liabilities 25,727,647 20,498,841
Equity 691,398 940,891

2016 2015
Revenues P7,663,417 P5,370,875
Benefits, claims and operating expenses 7,860,618 5,459,395
Loss before income tax (197,201) (88,520)
Net loss (223,460) (94,733)

In 2014, the Group agreed to sell, transfer, and convey its investments in PDB Properties, Inc. and PDB Insurance Agency, Inc. to a former
significant investor. The sale was duly approved by PDB’s BOD and duly reported to the BSP. The Group recognized gain on the sale
transaction amounting to P64.56 million included under ‘Miscellaneous income’ (Note 20).

MCB Life
On August 2, 2006, the BOD approved the joint project proposal of the Parent Company with Manufacturers Life Insurance Company (Manulife).
Under the proposal, the Parent Company will invest in a life insurance company owned by Manulife, and such company will be offering
innovative insurance and financial products for health, wealth and education through the Parent Company’s branches nationwide. The life
insurance company was incorporated as The Pramerica Life Insurance Company Inc. in 1998 but the name was changed to Manulife China
Bank Life Assurance Corporation on March 23, 2007. The Parent Company acquired 5.00% interest in MCB Life on August 8, 2007. This
investment is accounted for as an investment in an associate by virtue of the Bancassurance Alliance Agreement which provides the Parent
Company to be represented in MCB Life’s BOD and, thus, exercise significant influence over the latter.

China Bank 163 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

The BSP requires the Parent Company to maintain a minimum of 5.00% ownership over MCB Life in order for MCB Life to be allowed to
continue distributing its insurance products through the Parent Company’s branches.

On September 12, 2014, the BSP approved the request of the Parent Company to raise its capital investment in MCB Life from 5.00% to
40.00% of its authorized capital through purchase of 1.75 million common shares.

Commission income earned by the Parent Company from its bancassurance agreement amounting to P383.48 million, P337.41 million and
P277.14 million in 2016, 2015 and 2014, respectively, is included under ‘Miscellaneous income’ in the statements of income (Note 20).

11. BANK PREMISES, FURNITURE, FIXTURES AND EQUIPMENT

The composition of and movements in this account follow:

Consolidated
Furniture,
Land Fixtures and Leasehold Construction- 2016
(Note 22) Equipment Buildings Improvements in-Progress Total
Cost
Balance at beginning of year P3,347,222 P6,601,919 P1,832,834 P1,338,260 P90,873 P13,211,108
Additions − 809,311 99,911 215,122 11,307 1,135,651
Disposals/transfers* (1,818) (247,493) (39,220) (70,967) (15,775) (375,273)
Balance at end of year 3,345,404 7,163,737 1,893,525 1,482,415 86,405 13,971,486
Accumulated Depreciation
and Amortization
Balance at beginning of year − 5,097,654 895,859 861,406 − 6,854,919
Depreciation and amortization − 624,690 114,196 103,330 − 842,216
Disposals/transfers* − (159,842) 3,241 (67,687) − (224,288)
Balance at end of year − 5,562,502 1,013,296 897,049 − 7,472,847
Allowance for Impairment Losses (Note 15) − −
Balance at beginning of year − − 2,070 − − 2,070
Reclassification − − 301 − − 301
Balance at end of year − − 2,371 − − 2,371
Net Book Value at End of Year P3,345,404 P1,601,235 P877,858 P585,366 P86,405 P6,496,268
*Includes transfers from investment properties amounting to P4.69 million.

Consolidated
Furniture,
Land Fixtures and Leasehold Construction- 2015
(Note 22) Equipment Buildings Improvements in-Progress Total
Cost
Balance at beginning of year P2,882,702 P5,993,877 P1,919,398 P1,165,793 P45,997 P12,007,767
Additions 494,304 738,969 20,614 90,212 149,883 1,493,982
Disposals/transfers* (29,784) (130,927) (107,178) 82,255 (105,007) (290,641)
Balance at end of year 3,347,222 6,601,919 1,832,834 1,338,260 90,873 13,211,108
Accumulated Depreciation and Amortization
Balance at beginning of year − 4,255,780 835,065 663,527 − 5,754,372
Depreciation and amortization − 619,062 75,345 128,350 − 822,757
Disposals/transfers* − 222,812 (14,551) 69,529 − 277,790
Balance at end of year − 5,097,654 895,859 861,406 − 6,854,919
Allowance for Impairment Losses (Note 15)
Balance at beginning of year − 360 2,383 − − 2,743
Reclassification − (360) (313) − − (673)
Balance at end of year − − 2,070 − − 2,070
Net Book Value at End of Year P3,347,222 P1,504,265 P934,905 P476,854 P90,873 P6,354,119
*Includes transfers from investment properties amounting to P2.20 million.

China Bank 164 Annual Report 2016

 Parent Company
Furniture,
Land Fixtures and Leasehold Construction- 2016
(Note 22) Equipment Buildings Improvements in-Progress Total
Cost
Balance at beginning of year P2,786,350 P5,612,477 P1,027,236 P999,819 P88,054 P10,513,936
Additions − 675,734 89,359 169,256 7,701 942,050
Disposals/transfers* (40) (206,202) (38,987) (75,581) (15,616) (336,426)
Balance at end of year 2,786,310 6,082,009 1,077,608 1,093,494 80,139 11,119,560
Accumulated Depreciation
and Amortization
Balance at beginning of year − 4,386,057 462,552 668,125 − 5,516,734
Depreciation and amortization − 482,832 27,819 85,160 − 595,811
Disposals/transfers* − (93,512) 27,120 (70,574) − (136,966)
Balance at end of year − 4,775,377 517,491 682,711 − 5,975,579
Net Book Value at End of Year P 2,786,310 P1,306,632 P560,117 P410,783 P80,141 P5,143,981
*Includes transfers from investment properties amounting to P4.69 million.

Parent Company
Furniture,
Land Fixtures and Leasehold Construction- 2015
(Note 22) Equipment Buildings Improvements in-Progress Total
Cost
Balance at beginning of year P2,321,830 P5,386,709 P1,111,114 P909,764 P45,294 P9,774,711
Additions 494,304 653,246 17,443 89,898 145,850 1,400,741
Disposals/transfers* (29,784) (427,478) (101,321) 157 (103,090) (661,516)
Balance at end of year 2,786,350 5,612,477 1,027,236 999,819 88,054 10,513,936
Accumulated Depreciation
and Amortization
Balance at beginning of year − 3,987,316 446,545 592,651 − 5,026,512
Depreciation and amortization − 479,408 30,090 70,563 − 580,061
Disposals/transfers* − (80,667) (14,083) 4,911 − (89,839)
Balance at end of year − 4,386,057 462,552 668,125 − 5,516,734
Net Book Value at End of Year P2,786,350 P1,226,420 P564,684 P331,694 P88,054 P4,997,202
*Includes transfers from investment properties amounting to P2.20 million.

The Group adopted the deemed cost model as of January 1, 2004 and considered the carrying value of the land determined under its previous
accounting method (revaluation method) as the deemed cost of the asset as of January 1, 2005. Accordingly, revaluation increment amounting
to P1.28 billion was closed to surplus (Note 22) in 2011.

As of December 31, 2016 and 2015, the gross carrying amount of fully depreciated furniture, fixtures and equipment still in use amounted to
P2.89 billion and P2.36 billion , respectively, for the Group and P2.31 billion and P1.99 billion, respectively, for the Parent Company.

Gain on sale of furniture, fixtures and equipment amounting to P2.97 million, P0.89 million and P1.52 million in 2016, 2015 and 2014, respectively,
for the Group and P2.17 million, P0.50 million and P1.49 million in 2016, 2015 and 2014, respectively, for the Parent Company are included in
the statements of income under ‘Miscellaneous income’ account (Note 20).

In 2014, depreciation and amortization amounting to P803.71 million and P547.31million for the Group and Parent Company, respectively, are
included in the statements of income under ‘Depreciation and amortization’ account.

China Bank 165 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

12. INVESTMENT PROPERTIES

The composition of and movements in this account follow:

Consolidated
Buildings and 2016
Land Improvements Total
Cost
Balance at beginning of year P4,810,128 P2,588,845 P7,398,973
Additions 363,175 421,240 784,415
Disposals/write-off/transfers* (443,227) (221,688) (664,915)
Balance at end of year 4,730,076 2,788,397 7,518,473
Accumulated Depreciation and Amortization
Balance at beginning of year − 713,023 713,023
Depreciation and amortization − 173,007 173,007
Disposals/write-off/transfers* − (130,267) (130,267)
Balance at end of year − 755,763 755,763
Allowance for Impairment Losses (Note 15)
Balance at beginning of year 1,023,837 263,974 1,287,811
Provisions during the year − (797) (797)
Disposals/write-off/reclassification* 4,176 121,781 125,957
Balance at end of year 1,028,013 384,958 1,412,971
Net Book Value at End of Year P3,702,063 P1,647,676 P5,349,739

*Includes transfers to bank premises amounting to P4.69 million.

Consolidated
Buildings and 2015
Land Improvements Total
Cost
Balance at beginning of year P5,077,262 P2,367,671 P7,444,933
Additions due to business combination (Note 10) − − −
Additions 588,667 371,665 960,332
Disposals/write-off/transfers* (855,801) (150,491) (1,006,292)
Balance at end of year 4,810,128 2,588,845 7,398,973
Accumulated Depreciation and Amortization
Balance at beginning of year – 652,099 652,099
Depreciation and amortization – 142,277 142,277
Disposals/write-off/transfers* – (81,353) (81,353)
Balance at end of year – 713,023 713,023
Allowance for Impairment Losses (Note 15)
Balance at beginning of year 1,092,234 251,070 1,343,304
Provisions during the year – 6,633 6,633
Disposals/write-off/reclassification* (68,397) 6,271 (62,126)
Balance at end of year 1,023,837 263,974 1,287,811
Net Book Value at End of Year P3,786,291 P1,611,848 P5,398,139
*Includes transfers to bank premises amounting to P2.20 million.

China Bank 166 Annual Report 2016

 Parent Company
Buildings and 2016
Land Improvements Total
Cost
Balance at beginning of year P2,176,474 P1,520,017 P3,696,491
Additions 164,833 132,011 296,844
Disposals/write-off/transfers* (322,242) (140,679) (462,921)
Balance at end of year 2,019,065 1,511,349 3,530,414
Accumulated Depreciation and Amortization
Balance at beginning of year – 590,211 590,211
Depreciation and amortization – 98,915 98,915
Disposals/write-off/transfers* – (126,006) (126,006)
Balance at end of year – 563,120 563,120

Allowance for Impairment Losses (Note 15)

Balance at beginning of year 1,004,729 201,689 1,206,418
Reclassification – – –
Balance at end of year 1,004,729 201,689 1,206,418
Net Book Value at End of Year P1,014,336 P746,540 P1,760,876
*Includes transfers tobank premises amounting to P4.69 million.

Parent Company
Buildings and 2015
Land Improvements Total
Cost
Balance at beginning of year P2,321,888 P1,382,401 P3,704,289
Additions 134,311 123,540 257,851
Disposals/write-off/transfers* (279,725) 14,076 (265,649)
Balance at end of year 2,176,474 1,520,017 3,696,491
Accumulated Depreciation and Amortization
Balance at beginning of year − 588,689 588,689
Depreciation and amortization − 81,847 81,847
Disposals/write-off/transfers* – (80,325) (80,325)
Balance at end of year − 590,211 590,211
Allowance for Impairment Losses (Note 15)
Balance at beginning of year 1,011,848 202,389 1,214,237
Reclassification (7,119) (700) (7,819)
Balance at end of year 1,004,729 201,689 1,206,418
Net Book Value at End of Year P1,171,745 P728,117 P1,899,862
*Includes transfers to bank premises amounting to P2.20 million.

The Group’s investment properties consist entirely of real estate properties acquired in settlement of loans and receivables. The difference
between the fair value of the investment property upon foreclosure and the carrying value of the loan is recognized under ‘Gain on asset
foreclosure and dacion transactions’ in the statements of income.

In 2014, depreciation and amortization amounting to P118.05 million and P83.26 million for the Group and Parent Company, respectively, are
included in the statements of income under ‘Depreciation and amortization’ account.

China Bank 167 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Details of rental income earned and direct operating expenses incurred on investment properties follow:

Consolidated
2016 2015 2014
Rent income on investment properties P20,190 P31,100 P29,167
Direct operating expenses on investment properties generating rent
income 4,767 2,392 21,801
Direct operating expenses on investment properties not generating rent
income 67,619 52,429 61,121

Parent Company
2016 2015 2014
Rent income on investment properties P39,734 P7,020 P5,903
Direct operating expenses on investment properties generating rent
income 886 1,069 4,174
Direct operating expenses on investment properties not generating rent
income 44,089 35,270 43,010

Rent income earned from leasing out investment properties is included under ‘Miscellaneous income’ in the statements of income (Note 20).

On August 26, 2011, the Parent Company was registered as an Economic Zone Information Technology (IT) Facilities Enterprise with the
Philippine Economic Zone Authority (PEZA) to operate and maintain a proposed 17-storey building located inside the CBP-IT Park in Barangays
Mabolo, Luz, Hipodromo, Carreta, and Kamputhaw, Cebu City, for lease to PEZA-registered IT enterprises, and to be known as Chinabank
Corporate Center. This registration is under PEZA Registration Certificate No. 11-03-F.

Under this registration, the Parent Company is entitled to five percent (5.00%) final tax on gross income earned from locator IT enterprises and
related operations in accordance with existing PEZA rules. The Parent Company shall also be exempted from the payment of all national and
local taxes in relation to this registered activity.

13. GOODWILL AND INTANGIBLE ASSETS

Goodwill
Goodwill represents the excess of the acquisition costs over the fair value of the identifiable assets and liabilities of companies acquired by the
Group.

The Group attributed the goodwill arising from its acquisition of CBSI and PDB to factors such as increase in geographical presence and
customer base due to the branches acquired. None of the goodwill recognized is expected to be deductible for income tax purposes. CBSI
as surviving entity from the merger with PDB, is the identified CGU for this goodwill. The Parent Company’s Retail Banking Business (RBB) has
been identified as the CGU for impairment testing of the goodwill from its acquisition of CBSI.

As of December 31, 2016 and 2015, amount of goodwill per CGU follows:

Consolidated Parent Company

Retail Banking Business (RBB) P222,841 P222,841
CBSI 616,907 –
Total P839,748 P222,841

The recoverable amount of the CGUs have been determined based on a value-in-use calculation using cash flow projections from financial
budgets approved by senior management covering a five-year period, which do not include restructuring activities that the Group is not yet
committed to or significant future investments that will enhance the asset base of the CGU being tested. The significant assumptions used in
computing for the recoverable values of the CGUs follow:

RBB CBSI
Growth rates
Loans 9.30% 18.50%
Deposits 12.20% 18.00%
Discount rate 8.70% 8.70%
Terminal value growth rate 1.00% 1.00%

China Bank 168 Annual Report 2016

 The calculation of the value-in-use of the CGU is most sensitive to the following assumptions:

• Discount rates
• Steady growth rate used to extrapolate cash flows beyond the budget period

With regard to the assessment of value-in-use of the CGU, management believes that no reasonably possible change in any of the above key
assumptions would cause the carrying value of the goodwill to materially exceed its recoverable amount as of December 31, 2016 and 2015.

Branch Licenses
Branch licenses of the Group arose from the acquisitions of CBSI, Unity Bank, and PDB. As of December 31, 2016 and 2015, details of branch
licenses in the Group’s and Parent Company’s financial statements follow:

Consolidated Parent Company

Branch license from CBSI acquisition P477,600 P455,000
Branch license from Unity Bank acquisition 347,400 –
Branch license from PDB acquisition (Note 10) 2,839,500 –
Total P3,664,500 P455,000

The individual branches have been identified as the CGU for impairment testing of the branch licenses. The recoverable amounts of the CGUs
for impairment testing of the branch licenses have been determined based on the fair value less cost to sell calculations.

Capitalized software costs

As of December 31, 2016 and 2015, the capitalized software costs of the Group amounted to P549.16 million and P322.19 million, respectively.
Related accumulated amortization amounted to P123.94 million and P14.38 million as of December 31, 2016 and 2015, respectively. Additions
for the year 2016 and 2015 amounted to P226.97 million and P322.19 million, respectively. Amortization expense for the year 2016 and 2015
amounted to P109.56 million and P14.38 million, respectively.

As of December 31, 2016 and 2015, the capitalized software costs of the Parent Company amounted to P445.45 million and
P322.19 million, respectively. Related accumulated amortization amounted to P94.86 million and P14.38 million as of December 31, 2016
and 2015, respectively. Additions for the year 2016 and 2015 amounted to P123.26 million and P322.19 million, respectively. Amortization
expense for the year 2016 and 2015 amounted to P80.48 million and P14.38 million, respectively.

14. OTHER ASSETS

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Financial assets
Accounts receivable P4,153,356 P3,197,971 P3,120,990 P2,706,935
SCR 953,734 1,022,116 254,485 283,282
RCOCI 107,193 122,019 92,651 122,019
Others 437,919 635,155 136,374 207,631
5,652,202 4,977,261 3,604,500 3,319,867
Nonfinancial assets
Net plan assets (Note 23) 754,754 785,818 754,754 785,818
Prepaid expenses 155,016 264,745 146,036 130,925
Creditable withholding taxes 266,599 188,574 211,159 49,983
Security deposit 194,043 142,345 175,224 115,025
Documentary stamps 244,272 129,067 164,057 127,195
Sundry debits 84,824 51,113 62,736 46,720
Miscellaneous 263,371 180,055 – –
1,962,879 1,741,717 1,513,966 1,255,666
7,615,081 6,718,978 5,118,466 4,575,533
Allowance for impairment and credit losses (Note 15) (718,434) (741,589) (614,366) (626,103)
P6,896,647 P5,977,389 P4,504,100 P3,949,430

China Bank 169 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Accounts receivable
As of December 31, 2016 and 2015, about 41.92% and 54.45%, respectively, of the Group’s accounts receivable represents final withholding
taxes (FWT) imposed by the Bureau of Internal Revenue (BIR) and withheld by the Bureau of Treasury (BTr) from the proceeds collected by the
Group upon maturity of the Poverty Eradication and Alleviation Certificates (PEACe) bonds on October 18, 2011.

On October 17, 2011, the Parent Company together with seven other banks filed a joint petition against the BIR’s decision to impose 20.00%
FWT on PEACe bonds. The Supreme Court (SC) issued a temporary restraining order in favor of these banks on the same day and ordered
these banks to place in escrow an amount equivalent to the disputed withholding tax until final decision is rendered. However, the BTr withheld
the 20.00% FWT from the proceeds of the PEACe bonds and held it in an escrow account with the Land Bank of the Philippines.

On January 13, 2015, the SC ordered the BTr to release to the investor banks the amount corresponding to the 20% final withholding tax.  On
March 13, 2015, the BIR filed a motion for reconsideration and clarification.  Pursuant to a resolution dated April 21, 2015 by the SC, the banks
filed a consolidated comment on the motions filed by the respondents.  

In an en banc ruling received on October 5, 2016, the SC upheld its October 2011 decision ordering the BTr to return the P4.97 billion to the
petitioners and for the BTr to pay legal interest for failure to comply with the SC’s earlier ruling in favor of the holders of the said bonds. In late
October 2016, the Government filed a motion for partial reconsideration with regard to the October 2016 ruling.

In an en banc ruling received on January 17, 2017, the SC denied the motion for partial reconsideration.  No further pleadings or motions shall
be entertained by the SC.

Accounts receivable also includes non-interest bearing advances to officers and employees, with terms ranging from 1 to 30 days and
receivables of the Parent Company from automated teller machine (ATM) transactions of clients of other banks that transacted through any of
the Parent Company’s ATM terminals.

Miscellaneous
Miscellaneous consists mainly of unissued stationery and supplies, inter-office float items, and deposits for various services.

The following tables present the reconciliation of the movement of the allowance for impairment and credit losses on other assets:

Consolidated
Accounts 2016
Receivable SCR Miscellaneous Total
Balance at beginning of year P521,705 P54,787 P165,097 P741,589
Provisions (recoveries) during the year (Note 15) 49,453 75 36,027 85,555
Transfers/others (Note 9) (134,407) 5,788 19,909 (108,710)
Balance at end of year P436,751 P60,650 P221,033 P718,434

Consolidated
Accounts 2015
Receivable SCR Miscellaneous Total
Balance at beginning of year P513,416 P34,224 P158,542 P706,182
Provisions during the year (Note 15) 16,384 19,703 3,813 39,900
Transfers/others (Note 9) (8,095) 860 2,742 (4,493)
Balance at end of year P521,705 P54,787 P165,097 P741,589

Parent Company
Accounts 2016
Receivable SCR Miscellaneous Total
Balance at beginning of year P444,444 P25,809 P155,850 P626,103
Provisions (recoveries) during the year (Note 15) 24,986 – 79 25,065
Transfers/others (Note 9) (72,838) 4,527 31,509 (36,802)
Balance at end of year P396,592 P30,336 P187,438 P614,366

Parent Company
Accounts 2015
Receivable SCR Miscellaneous Total
Balance at beginning of year P459,950 P25,809 P155,899 P641,658
Provisions (recoveries) during the year (Note 15) (434) – 76 (358)
Transfers/others (Note 9) (15,072) – (125) (15,197)
Balance at end of year P444,444 P25,809 P155,850 P626,103

China Bank 170 Annual Report 2016

15. ALLOWANCE FOR IMPAIRMENT AND CREDIT LOSSES

Changes in the allowance for impairment and credit losses are as follows:

Consolidated Parent Company

2016 2015 2016 2015
Balances at beginning of year
Loans and receivables P6,994,670 P6,734,550 P6,151,786 P6,225,088
Investment properties 1,287,811 1,343,304 1,206,418 1,214,237
Accrued interest receivable 69,331 79,077 68,342 78,532
AFS financial assets 38,742 38,742 6,323 6,323
Bank premises, furniture, fixtures and equipment 2,070 2,743 – –
Other assets 741,589 706,182 626,103 641,658
9,134,213 8,904,598 8,058,972 8,165,838
Provisions charged to operations 850,546 966,574 521,475 487,485
Accounts charged off and others (977,248) (736,959) (912,296) (594,351)
(126,702) 229,615 (390,821) (106,866)
Balances at end of year
Loans and receivables (Note 9) 6,654,995 6,994,670 5,709,025 6,151,786
Investment properties (Note 12) 1,412,971 1,287,811 1,206,418 1,206,418
Accrued interest receivable 179,339 69,331 62,019 68,342
AFS financial assets (Note 8) 38,742 38,742 6,323 6,323
Bank premises, furniture, fixtures and
equipment (Note 11) 2,371 2,070 – –
Other assets (Note 14) 718,434 741,589 614,366 626,103
P9,006,852 P9,134,213 P7,598,151 P8,058,972

At the current level of allowance for impairment and credit losses, management believes that the Group has sufficient allowance to cover any
losses that may be incurred from the non-collection or non-realization of its loans and receivables and other risk assets.

The separate valuation allowance of acquired loans and receivables from PDB amounting to P1.59 billion was not recognized by the Group on
the effectivity date of acquisition as these receivables were measured at fair value at acquisition date. Any uncertainties about future cash flows
of these receivables were included in their fair value measurement. Also, the separate valuation allowance of acquired investment properties
from PDB amounting to P199.15 million was not recognized by the Group on the effectivity date of acquisition as these properties were
measured at fair value on acquisition date.

A reconciliation of the allowance for credit losses on loans and receivables from customers, AFS financial assets and accrued interest receivable
follows:

Consolidated
2016
AFS Financial
Loans and Receivables Assets
Corporate and Unquoted Accrued
Commercial Consumer Trade-related Equity Interest
Lending Lending Lending Others Total Securities Receivable
Balance at beginning of year P5,289,222 P1,313,023 P390,326 P2,099 P6,994,670 P38,742 P69,331
Provisions (recoveries) during the year 311,242 410,941 (258) 689 722,614 - 43,174
Transfers/others (1,007,077) (92,504) (112,445) 149,737 (1,062,289) (4,464) 66,834
Balance at end of year P4,593,387 P1,631,460 P277,623 P152,525 P6,654,995 P34,298 P179,339
Individual impairment P1,462,699 P729,796 P145,476 P151,836 P2,489,807 P38,302 P179,339
Collective impairment 3,130,688 901,664 132,147 689 4,165,188 - -
P4,593,387 P1,631,460 P277,623 P152,525 P6,654,995 P38,298 P179,339

China Bank 171 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Consolidated
2015
AFS Financial
Loans and Receivables Assets
Corporate and Unquoted Accrued
Commercial Consumer Trade-related Equity Interest
Lending Lending Lending Others Total Securities Receivable
Balance at beginning of year P5,066,065 P959,999 P708,387 P99 P6,734,550 P38,742 P79,077
Provisions (recoveries) during the year 318,146 593,478 6,874 2,085 920,583 59 (601)
Transfers/others (94,989) (240,454) (324,935) (85) (660,463) (59) (9,145)
Balance at end of year P5,289,222 P1,313,023 P390,326 P2,099 P6,994,670 P38,742 P69,331
Individual impairment P2,082,499 P837,178 P261,589 P14 P3,181,280 P38,742 P69,331
Collective impairment 3,206,723 475,845 128,737 2,085 3,813,390 – –
P5,289,222 P1,313,023 P390,326 P2,099 P6,994,670 P38,742 P69,331

Parent Company
2016
AFS Financial
Loans and Receivables Assets
Corporate and Unquoted Accrued
Commercial Consumer Trade-related Equity Interest
Lending Lending Lending Others Total Securities Receivable
Balance at beginning of year P5,053,830 P707,616 P390,327 P14 P6,151,786 P6,323 P68,342
Provisions (recoveries) during the year 266,007 230,000 (258) 689 496,437 - (27)
Transfers/others (938,711) 123,749 (124,222) (14) (939,198) - (6,296)
Balance at end of year P4,381,126 P1,061,364 P265,846 P689 P5,709,025 P6,323 P62,019
Individual impairment P1,292,911 P729,796 P137,109 P- P2,159,816 P6,323 P62,019
Collective impairment 3,088,214 331,569 128,737 689 3,549,209 - -
P4,381,126 P1,061,364 P265,846 P689 P5,709,025 P6,323 P62,019

Parent Company
2015
AFS Financial
Loans and Receivables Assets
Corporate and Unquoted Accrued
Commercial Consumer Trade-related Equity Interest
Lending Lending Lending Others Total Securities Receivable
Balance at beginning of year P4,842,834 P673,853 P708,387 P14 P6,225,088 P6,323 P78,532
Provisions (recoveries) during the year 282,013 200,000 6,874 – 488,887 – (1,044)
Transfers/others (71,017) (166,237) (324,935) – (562,189) – (9,146)
Balance at end of year P5,053,830 P707,616 P390,326 P14 P6,151,786 P6,323 P68,342
Individual impairment P1,856,131 P440,394 P261,589 P14 P2,558,128 P6,323 P68,342
Collective impairment 3,197,699 267,222 128,737 – 3,593,658 – –
P5,053,830 P707,616 P390,326 P14 P6,151,786 P6,323 P68,342

16. DEPOSIT LIABILITIES

As of December 31, 2016 and 2015, ­­­39.42% and 40.66% respectively, of the total deposit liabilities of the Group are subject to periodic interest
repricing. The remaining deposit liabilities bear annual fixed interest rates ranging from 0.13% to 3.25% in 2016, 0.13% to 2.75% in 2015 and
2014.

Interest Expense on Deposit Liabilities

This account consists of:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Demand P197,595 P165,228 P147,535 P143,917 P122,277 P109,131
Savings 2,635,565 1,823,468 1,810,273 2,383,021 1,570,706 1,638,312
Time 1,998,395 2,019,592 2,058,910 1,102,189 1,188,183 1,157,255
P4,831,555 P4,008,288 P4,016,718 P3,629,127 P2,881,166 P2,904,698

China Bank 172 Annual Report 2016

 BSP Circular No. 830 requires reserves against deposit liabilities. As of December 31, 2016 and 2015, due from BSP amounting to
P78.78 billion and P61.43 billion, respectively, were set aside as reserves for deposit liabilities per latest report submitted by the Parent
Company to the BSP. As of December 31, 2016 and 2015, the Parent Company is in compliance with such regulation.

On August 3, 2016, the BOD of the Parent Company approved the issuance of Long Term Negotiable Certificates of Deposits (LTNCD) of up to
20.00 billion in tranches of 5.00 billion to 10.00 billion each and with tenors ranging from 5 to 7 years to support the Group’s strategic initiatives
and business growth. October 27, 2016, the Monetary Board of the BSP approved the LTNCD issuances. On November 18, 2016, the Parent
Company issued at par LTNCDs with aggregate principal amount of P9.58 billion due May 18, 2022. The LTNCDs are included under the ‘Time
deposit liabilities’ account. The LTNCDs bear a fixed coupon rate of 3.25% per annum, payable quarterly in arrears.

17. BILLS PAYABLE

Bills Payable
The Group’s and the Parent Company’s bills payable consist of:

Consolidated Parent Company

2016 2015 2016 2015
Interbank loans payable P16,954,998 P18,422,442 P16,954,998 P18,422,442
Government lending programs − 662,738 − 208
P16,954,998 P19,085,180 P16,954,998 P18,422,650

Interbank loans payable

Interbank loans payable consists of short-term dollar-denominated borrowings of the Group and the Parent Company with annual interest
ranging from 1.25% to 1.68% in 2016 and 2015.

As of December 31, 2016, the carrying amount of foreign currency-denominated HTM and AFS financial assets pledged by the Parent Company
as collateral for its interbank borrowings amounted to P8.96 billion and P0.53 billion, respectively. The fair value of HTM financial assets pledged
as collateral amounted to P8.41 billion as of December 31, 2016 (Note 8).

As of December 31, 2015, the carrying amount of foreign currency-denominated HTM and AFS financial assets pledged by the Parent Company
as collateral for its interbank borrowings amounted to P8.09 billion and P4.72 billion, respectively. The fair value of HTM financial assets pledged
as collateral amounted to P8.66 billion as of December 31, 2015 (Note 8).

As of December 31, 2016 and 2015, margin deposits amounting to P74.68 million and P561.21million, respectively, are deposited with various
counterparties to meet the collateral requirements for its interbank bills payable.

Interbank loans payable includes a US$158.00 million unsecured, three-year term loan facility from regional and international banks. The facility
carries an interest margin of 1.40% per annum over 3-month LIBOR. The term of the loan provides for a financial covenant such that the Parent
Company shall ensure that its minimum capital adequacy ratio (CAR) will, at all times, be equal to or greater of (a) the percentage prescribed by
BSP from time to time and (b) 10.00%. Otherwise, the loan shall become immediately due and payable. The borrowing was measured initially
at fair value and was subsequently carried at amortized cost. As of December 31, 2016 and 2015, the carrying value of the loan amounted to
P7.81 billion and P7.37 billion respectively.

Government lending programs

As of December 31, 2015, this account consists of:

Counterparty Average term Rates Consolidated Parent Company

Land Bank of the Philippines 5 -10 years 3.50% to 8.66% P460,768 P208
Social Security Services 6 years 2.50% to 5.25% 178,056 −
Small Business Guaranty and Finance Corporation 4 years 5.00% to 6.50% 23,914 −
P662,738 P208

Loans and receivables of the Group and the Parent Company amounting to P760.38 million and P0.21 million as of December 31, 2015,
respectively, are pledged as collateral for the rediscounting facilities (Note 9). Loans and receivables pledged as collateral shall be released
by the rediscounting institution once the rediscounted loan has been fully paid upon maturity. In case a particular loan account pledged as
collateral is paid in full by the borrower before it matures, the equivalent discount value shall be paid by the Group to the rediscounting institution
before the pledged collateral can be released.

China Bank 173 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

18. ACCRUED INTEREST AND OTHER EXPENSES

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Accrued payable for employee benefits P789,691 P725,273 P786,014 P724,134
Accrued interest payable 552,881 384,114 464,741 293,213
Accrued lease payable 121,139 111,078 119,950 107,237
Accrued taxes and other licenses 87,156 77,658 77,837 74,188
Accrued other expenses payable 317,323 286,151 112,809 62,223
P1,868,190 P1,584,274 P1,561,351 P1,260,995

19. OTHER LIABILITIES

This account consists of:

Consolidated Parent Company

2016 2015 2016 2015
Financial liabilities
Accounts payable P2,801,269 P2,107,169 P1,731,365 P1,261,933
Acceptances payable 1,172,158 997,418 1,172,158 997,418
Due to PDIC 428,308 345,805 428,308 345,805
Other credits-dormant 318,701 218,635 304,036 214,220
Due to the Treasurer of the Philippines 28,131 95,838 23,716 95,838
Margin deposits 1,702 3,356 1,702 3,356
Miscellaneous 488,139 636,121 428,532 419,288
5,238,408 4,404,342 4,089,817 3,337,858
Nonfinancial liabilities
Withholding taxes payable 150,814 137,523 115,928 107,906
Retirement liabilities (Note 23) 144,686 164,256 – –
295,500 301,779 115,928 107,906
P5,533,908 P4,706,121 P4,205,745 P3,445,764

Accounts payable includes payables to suppliers and service providers, and loan payments and other charges received from customers in
advance.

Miscellaneous mainly includes sundry credits, inter-office float items, and dormant deposit accounts.

20. OTHER OPERATING INCOME AND MISCELLANEOUS EXPENSES

Service Charges, Fees and Commissions

Details of this account are as follows:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Service and collection charges
Deposits P597,294 P628,191 P659,597 P535,397 P572,448 P610,332
Loans 214,237 170,070 97,683 40,301 34,785 30,743
Remittances 302,184 248,615 132,939 302,184 248,615 132,939
Others 114,791 169,744 176,556 93,452 90,019 70,257
Fees and commissions 894,963 617,698 495,032 348,114 510,273 376,378
P2,123,469 P1,834,318 P1,561,807 P1,319,448 P1,456,140 P1,220,649

China Bank 174 Annual Report 2016

Trading and Securities Gain - Net
This account consists of:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Financial assets at FVPL:
Held-for-trading (Note 8) (P135,709) (P50,330) P28,505 (P138,286) (P48,087) (P45,421)
Financial assets designated at FVPL (Note 8) 111,615 (120,134) (40,401) 111,615 (120,134) (40,401)
Derivative assets (Note 24) 23,510 (1,425) 3,065 23,510 (1,425) 3,065
AFS financial assets 918,673 638,723 544,094 856,031 629,642 541,653
P918,089 P466,834 P535,263 P852,870 P459,996 P458,896

Miscellaneous Income
Details of this account are as follows:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Bancassurance (Note 10) P383,483 P337,521 P277,138 P383,483 P337,407 P277,138
Dividends (Note 8) 193,229 263,330 311,073 193,229 255,407 311,073
Rental on bank premises 91,591 51,731 56,183 67,134 39,516 28,642
Fund transfer fees 50,658 56,621 48,792 50,658 56,621 48,792
Rental safety deposit boxes 24,627 23,139 20,017 24,269 22,768 19,385
Recovery of charged off assets 18,734 15,620 93,797 10,523 7,943 79,256
Miscellaneous income (Notes 10, 11 and 12) 116,123 218,893 781,064 70,801 172,291 626,940
P878,445 P966,855 P1,588,064 P800,097 P891,953 P1,391,226

Miscellaneous Expenses
Details of this account are as follows:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Service charges P225,889 P181,216 P86,067 P225,889 P181,216 P86,067
Information technology 108,458 371,949 326,718 227,627 280,973 236,261
Litigations 117,363 100,947 149,996 43,261 26,486 61,452
Freight 34,331 25,534 18,405 27,354 21,338 13,970
Membership fees and dues 29,329 17,012 19,228 28,135 14,861 17,698
Clearing and processing fee 27,379 14,337 23,143 24,525 11,591 16,784
Broker’s fee 12,403 22,970 52,215 12,403 22,970 25,959
Miscellaneous expense 518,834 267,969 346,027 352,295 241,307 267,122
P1,073,986 P1,001,934 P1,021,799 P941,489 P800,742 P725,313

China Bank 175 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

21. MATURITY ANALYSIS OF ASSETS AND LIABILITIES

The following tables present both the Group’s and Parent Company’s assets and liabilities as of December 31, 2016 and 2015 analyzed
according to when they are expected to be recovered or settled within one year and beyond one year from the respective reporting date:

Consolidated
2016 2015
Within Over Within Over
Twelve Months Twelve Months Total Twelve Months Twelve Months Total
Financial assets
Cash and other cash items P12,010,543 P– P12,010,543 P11,377,101 P– P11,377,101
Due from BSP 91,964,495 – 91,964,495 86,318,501 – 86,318,501
Due from other banks 11,332,236 – 11,332,236 21,243,492 – 21,243,492
Interbank loans receivables 3,451,543 – 3,451,543 – – –
Financial assets at FVPL 7,703,899 – 7,703,899 6,244,593 – 6,244,593
AFS financial assets - gross 11,849,322 22,063,143 33,912,465 1,370,480 47,497,495 48,867,975
HTM financial assets 2,112,503 55,292,297 57,404,800 8,596,143 7,540,004 16,136,147
Loans and receivables - gross 150,962,924 242,775,212 393,738,136 155,520,631 161,514,151 317,034,782
Accrued interest receivable - gross 3,193,868 – 3,193,868 2,691,068 – 2,691,068
Other assets - gross 4,698,468 953,734 5,652,202 3,955,145 1,022,116 4,977,261
299,279,801 321,084,386 620,364,187 297,317,154 217,573,766 514,890,920
Nonfinancial assets
Bank premises, furniture, fixtures
and equipment - net of
accumulated depreciation and
amortization – 6,498,639 6,498,639 – 6,356,189 6,356,189
Investment properties - net of
accumulated depreciation – 6,762,710 6,762,710 – 6,685,950 6,685,950
Deferred tax assets – 1,666,267 1,666,267 – 1,381,280 1,381,280
Investments in associates – 278,752 278,752 – 371,399 371,399
Intangible assets – 4,089,715 4,089,715 – 3,972,308 3,972,308
Goodwill – 839,748 839,748 – 839,748 839,748
Other assets - gross 944,754 1,015,932 1,960,686 775,844 965,873 1,741,717
944,754 21,151,763 22,096,517 775,844 20,572,747 21,348,591
Allowance for impairment and credit losses (Note 15) (9,006,852) (9,134,213)
Unearned discounts (Note 9) (255,841) (278,335)
(9,262,693) (9,412,548)
P633,198,011 P526,826,963
Financial liabilities
Deposit liabilities P513,517,732 P28,065,286 P541,583,018 P412,650,027 P26,615,659 P439,265,686
Bills payable 16,954,998 – 16,954,998 11,062,703 8,022,477 19,085,180
Manager’s checks 2,029,778 – 2,029,778 1,456,498 – 1,456,498
Accrued interest and other
expenses* 870,204 – 870,204 670,265 – 670,265
Derivative liabilities 243,198 – 243,198 66,373 – 66,373
Other liabilities 5,238,408 – 5,238,408 4,404,342 – 4,404,342
538,854,318 28,065,286 566,919,604 430,310,208 34,638,136 464,948,344
Nonfinancial liabilities
Accrued interest and other expenses 87,156 910,830 997,986 802,931 111,078 914,009
Deferred tax liabilities – 1,161,414 1,161,414 – 1,116,147 1,116,147
Income tax payable 437,303 – 437,303 375,780 – 375,780
Other liabilities 150,814 144,686 295,500 137,523 164,256 301,779
P539,529,591 P30,282,216 P569,811,807 P431,626,442 P36,029,617 P467,656,059
*Accrued interest and other expenses include accrued interest payable and accrued other expenses payable (Note 18).

China Bank 176 Annual Report 2016

 Parent Company
2016 2015
Within Over Within Over
Twelve Months Twelve Months Total Twelve Months Twelve Months Total
Financial assets
Cash and other cash items P10,580,748 P– P10,580,748 P10,052,891 P– P10,052,891
Due from BSP 85,307,128 – 85,307,128 77,003,616 – 77,003,616
Due from other banks 9,689,165 – 9,689,165 19,200,544 – 19,200,544
Interbank loans receivables/SPURA 2,958,465 – 2,958,465 – – –
Financial assets at FVPL 7,232,882 – 7,232,882 5,465,417 – 5,465,417
AFS financial assets - gross 11,159,904 20,000,169 31,160,073 1,205,447 45,635,075 46,840,522
HTM financial assets 2,087,861 51,981,160 54,069,021 8,515,233 5,430,412 13,945,645
Loans and receivables - gross 131,527,458 203,449,468 334,976,926 134,470,413 131,495,001 265,965,414
Accrued interest receivable - gross 2,728,373 – 2,728,373 2,269,589 – 2,269,589
Other assets - gross 3,350,015 254,485 3,604,500 3,036,585 283,282 3,319,867
266,621,999 275,685,282 542,307,281 261,219,735 182,843,770 444,063,505
Nonfinancial assets
Bank premises, furniture, fixtures
and equipment - net of
– 5,143,981 5,143,981 – 4,997,202 4,997,202
accumulated depreciation and
amortization
Investment properties - net of
– 2,967,294 2,967,294 – 3,106,280 3,106,280
accumulated depreciation
Deferred tax assets – 1,508,150 1,508,150 – 1,369,147 1,369,147
Investments in subsidiaries – 12,169,037 12,169,037 – 9,164,601 9,164,601
Investment in associates – 276,559 276,559 – 371,399 371,399
Intangible assets – 805,582 805,582 – 762,808 762,808
Goodwill – 222,841 222,841 – 222,841 222,841
Other assets - gross 759,212 754,754 1,513,966 469,848 785,818 1,255,666
759,212 23,848,198 24,607,410 469,848 20,780,096 21,249,944
Allowances for impairment and credit losses (Note 15) (7,598,152) (8,058,972)
Unearned discounts (Note 9) (198,042) (168,620)
(7,796,194) (8,227,592)
P559,143,914 P457,085,857
Financial liabilities
Deposit liabilities P455,816,577 P15,145,414 P470,961,991 P368,242,423 P5,360,993 P373,603,416
Bills payable 16,954,998 – 16,954,998 11,053,287 7,369,363 18,422,650
Manager’s checks 1,445,585 – 1,445,585 741,479 – 741,479
Accrued interest and other
577,550 – 577,550 355,436 – 355,436
expenses*
Derivative liabilities 243,198 – 243,198 66,373 – 66,373
Other liabilities 4,089,817 – 4,089,817 3,337,858 – 3,337,858
479,127,725 15,145,414 494,273,139 383,796,856 12,730,356 396,527,212
Nonfinancial liabilities
Accrued interest and other expenses 77,836 905,965 983,801 798,322 107,237 905,559
Income tax payable 354,212 – 354,212 345,312 – 345,312
Other liabilities 115,928 – 115,928 107,906 – 107,906
P479,675,701 P16,051,379 P495,727,080 P385,048,396 P12,837,593 P397,885,989
*Accrued interest and other expenses include accrued interest payable and accrued other expenses payable (Note 18).

China Bank 177 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

22. EQUITY

The Parent Company’s capital stock consists of (amounts in thousands, except for number of shares):

2016 2015
Shares Amount Shares Amount
Common stock - P10.00 par value
Authorized – shares 2,500,000,000 2,500,000,000
Issued and outstanding
Balance at beginning of year 1,853,728,497 P18,537,285 1,716,414,317 P17,164,143
Stock dividends* 148,299,339 1,482,993 137,314,180 1,373,142
2,002,027,836 P20,020,278 1,853,728,497 P18,537,285
*The stock dividends declared include fractional shares equivalent to 1,060 shares in 2016 and 1,035 shares in 2015.

The Parent Company shares are listed in the Philippine Stock Exchange.

On March 5, 2014, the BOD authorized the Parent Company to conduct a rights issue, by way of offering common shares to certain eligible
shareholders. The BSP approved the stock rights offering on March 18, 2014.

The stock rights offering yielded a subscription of 161,609,878 common shares which were listed at the Philippine Stock Exchange on
May 13, 2014. The total proceeds of the stock rights offering amounted to P7.93 billion, net of stock issuance cost of P67.53 million which
was deducted from additional paid in capital.

The additional capital enabled the Parent Company to pursue growth strategies while ensuring that its capital adequacy levels remain above the
new Basel III requirements, particularly in light of the acquisition of PDB.

On May 8, 2014, the BOD approved and the stockholders ratified the increase in the Parent Company’s authorized capital stock from
P20.00 billion to P25.00 billion, or from 2.00 billion to 2.50 billion shares with par value of P10.00 per share. The increase in the Parent
Company’s authorized capital stock was subsequently approved by the BSP and the SEC on August 7, 2014 and August 29, 2014, respectively.

The summarized information on the Parent company’s registration of securities under the Securities Regulation Code follows:

Date of SEC Approval Authorized Shares*

April 12, 1991 100,000
October 7, 1993 150,000
August 30, 1994 200,000
July 26, 1995 250,000
September 12, 1997 500,000
September 5, 2005 1,000,000
September 14, 2007 1,600,000
September 5, 2008 2,000,000
August 29, 2014 2,500,000
* Restated to show the effects of the ten-for-one stock split in 2012

As reported by the Parent Company’s transfer agent, Stock Transfer Service, Inc., the total number of stockholders is 1,959 and 1,980 as of
December 31, 2016 and 2015, respectively.

Subsequent Events
On January 19, 2017, the BOD of CBCC approved the increase in authorized capital stock of CBCC from P500.00 million to P2.00 billion to
enable CBCC to handle bigger deals. The approval was ratified by the BOD of the Parent Company on February 1, 2017. On the same date,
the BOD of the Parent Company approved the capital infusion of P500.00 million to be paid within the first quarter of 2017.

On Febuary 22, 2017, the BOD of the Parent Company approved to undertake a stock rights offering through the issuance of new shares from
the unissued shares of the Parent Company’s authorized capital stock that will generate the aggregate issue of approximately P15.00 billion to
all eligible stockholders.

China Bank 178 Annual Report 2016

Dividends
Details of the Parent Company’s cash dividend payments follow:

Date of Date of Date of Stock Dividend Cash Dividend

Declaration Record Payment Per Share Per Share

May 05, 2016 May 23, 2016 June 03, 2016 8% 1.00
May 07, 2015 August 12, 2015 September 09, 2015 8% 1.00
May 08, 2014 September 19, 2014 October 15, 2014 8% 1.00
May 02, 2013 July 19, 2013 August 14, 2013 10% 1.20

The computation of surplus available for dividend declaration in accordance with SEC Memorandum Circular No. 11 issued in December 2008
differs to a certain extent from the computation following BSP guidelines.

As of December 31, 2016 and 2015, surplus includes the amount of P1.28 billion, net of deferred tax liability of P547.40 million, representing
transfer of revaluation increment on land which was carried at deemed cost when the Group transitioned to PFRS in 2005 (Note 11). This
amount will be available to be declared as dividends upon sale of the underlying land.

In the consolidated financial statements, a portion of the Group’s surplus corresponding to the net earnings of the subsidiaries and associates
amounting to P607.74 million and P296.00 million as of December 31, 2016 and 2015, respectively, is not available for dividend declaration.
The accumulated equity in net earnings becomes available for dividends upon declaration and receipt of cash dividends from the investees.

Reserves
In compliance with BSP regulations, 10.00% of the Parent Company’s profit from trust business is appropriated to surplus reserve. This annual
appropriation is required until the surplus reserves for trust business equals 20.00% of the Parent Company’s authorized capital stock.

Capital Management
The primary objectives of the Group’s capital management are to ensure that it complies with externally imposed capital requirements and that
it maintains strong credit ratings and healthy capital ratios in order to support its business and to maximize shareholders’ value.

The Group manages its capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of
its activities. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividend payment to shareholders, return
capital to shareholders or issue capital securities. No changes were made in the objectives, policies and processes as of December 31, 2016
and 2015.

Regulatory Qualifying Capital

Under existing BSP regulations, the determination of the Parent Company’s compliance with regulatory requirements and ratios is based on the
amount of the Parent Company’s unimpaired capital (regulatory capital) as reported to the BSP. This is determined on the basis of regulatory
accounting policies which differ from PFRS in some respects.

In addition, the risk-based capital ratio of a bank, expressed as a percentage of qualifying capital to risk-weighted assets (RWA), should not be
less than 10.00% for both solo basis (head office and branches) and consolidated basis (Parent Company and subsidiaries engaged in financial
allied undertakings but excluding insurance companies). Qualifying capital and RWA are computed based on BSP regulations. RWA consists
of total assets less cash on hand, due from BSP, loans covered by hold-out on or assignment of deposits, loans or acceptances under letters
of credit to the extent covered by margin deposits and other non-risk items determined by the Monetary Board of the BSP.

On August 4, 2006, the BSP, under BSP Circular No. 538, issued the prescribed guidelines implementing the revised risk-based capital
adequacy framework for the Philippine banking system to conform to Basel II capital adequacy framework. The BSP guidelines took effect on
July 1, 2007. Thereafter, banks were required to compute their CAR using these guidelines.

Standardized credit risk weights were used in the credit assessment of asset exposures. Third party credit assessments were based on ratings
by Standard & Poor’s, Moody’s and Fitch, while PhilRatings were used on peso-denominated exposures to Sovereigns, MDBs, Banks, LGUs,
Government Corporations, Corporates.

On January 15, 2013, the BSP issued Circular No. 781, Basel III Implementing Guidelines on Minimum Capital Requirements, which provides the
implementing guidelines on the revised risk-based capital adequacy framework particularly on the minimum capital and disclosure requirements
for universal banks and commercial banks, as well as their subsidiary banks and quasi-banks, in accordance with the Basel III standards. The
circular took effect on January 1, 2014.

China Bank 179 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

The Circular sets out a minimum Common Equity Tier 1 (CET1) ratio of 6.00% and Tier 1 capital ratio of 7.50%. It also introduces a capital
conservation buffer of 2.50% comprised of CET1 capital. The BSP’s existing requirement for Total CAR remains unchanged at 10.00% and this
ratio shall be maintained at all times.

Further, existing capital instruments as of December 31, 2010 which do not meet the eligibility criteria for capital instruments under the revised
capital framework shall no longer be recognized as capital upon the effectivity of Basel III. Capital instruments issued under BSP Circular
Nos. 709 and 716 (the circulars amending the definition of qualifying capital particularly on Hybrid Tier 1 and Lower Tier 2 capitals), starting
January 1, 2011 and before the effectivity of BSP Circular No. 781, shall be recognized as qualifying capital until December 31, 2015. In addition
to changes in minimum capital requirements, this Circular also requires various regulatory adjustments in the calculation of qualifying capital.

The CAR of the Group and the Parent Company as of December 31, 2016 as reported to the BSP are shown in the table below.

Consolidated Parent Company

2016 2015 2016 2015
(Amounts in Million Pesos)
CET 1 Capital P58,170 P54,071 P57,409 P54,136
Less: Regulatory Adjustments 7,338 6,678 13,169 11,124
50,832 47,393 44,240 43,012
Additional Tier 1 Capital − − − −
Less: Regulatory Adjustments − − − −
− − − −
Net Tier 1 Capital 50,832 47,393 44,240 43,012
Tier 2 Capital 4,076 3,486 3,514 2,955
Less: Regulatory Adjustments − − − −
Net Tier 2 Capital 4,076 3,486 3,514 2,955
Total Qualifying Capital P54,909 P50,879 P47,754 P45,967

Consolidated Parent Company

2016 2015 2016 2015
(Amounts in Million Pesos)
Credit RWA P414,381 P348,149 P352,651 P294,883
Market RWA 4,575 2,770 4,339 2,274
Operational RWA 30,727 25,906 25,689 22,703
Total RWA P449,683 P376,825 P382,679 P319,860

CET 1 capital ratio 11.30% 12.58% 11.56% 13.45%

Tier 1 capital ratio 11.30% 12.58% 11.56% 13.45%
Total capital ratio 12.21% 13.50% 12.48% 14.37%

On August 14, 2015, the MB of the BSP, in its Resolution No. 1292 approved the request of the Parent Company that PDB’s compliance
with the minimum capital ratios prescribed under Basel III framework be assessed based on the consolidated capital position of the Parent
Company, CBSI and PDB up to one (1) year or upon issuance of the certified true copy of the Articles of Merger and Plan of Merger by the SEC,
whichever comes earlier.

The Parent Company has complied with all externally imposed capital requirements throughout the period.

The issuance of BSP Circular No. 639 covering the ICAAP in 2009 supplements the BSP’s risk-based capital adequacy framework under
Circular No. 538. In compliance with this circular, the Parent Company has adopted and developed its ICAAP framework to ensure that
appropriate level and quality of capital are maintained by the Group. Under this framework, the assessment of risks extends beyond the Pillar 1
set of credit, market and operational risks and onto other risks deemed material by the Parent Company. The level and structure of capital are
assessed and determined in light of the Parent Company’s business environment, plans, performance, risks and budget; as well as regulatory
edicts. BSP requires submission of an ICAAP document every March 31. The Group has complied with this requirement.

23. RETIREMENT PLAN

The Group has separate funded noncontributory defined benefit retirement plans covering substantially all its officers and regular employees.
The retirement plans are administered by the Parent Company’s Trust Group which acts as the trustee of the plans. Under these retirement
plans, all covered officers and employees are entitled to cash benefits after satisfying certain age and service requirements. The latest actuarial
valuation studies of the retirement plans were made as of December 31, 2016.

China Bank 180 Annual Report 2016

The Group’s annual contribution to the retirement plan consists of a payment covering the current service cost, unfunded actuarial accrued
liability and interest on such unfunded actuarial liability.

The amounts of net defined benefit asset in the balance sheets follow:

Consolidated Parent Company

2016 2015 2016 2015
Net plan assets (Note 14) P754,754 P785,818 P754,754 P785,818
Retirement liabilities (Note 19) (144,686) (164,256) – –
P610,068 P621,562 P754,754 P785,818

The movements in the defined benefit asset, present value of defined benefit obligation and fair value of plan assets follow:

Consolidated
2016
Remeasurements in other comprehensive income

Net benefit cost Return on

plan assets Actuarial Actuarial Actuarial
(excluding changes arising changes arising changes arising
amount from from changes from changes Changes in
January 1, Current Net pension Benefits included experience in financial in demographic remeasurement Contribution December 31,
2016 service cost Net interest expense* paid in net interest) adjustments assumptions assumptions gains (losses) by employer 2016

(l) = a + b + e + f
(a) (c) (d) (e) = c + d (f) (g) (h) (i) (j) = g + h + i (k) +j+k
Fair value of plan
assets P4,472,990 P− P179,522 P179,522 (P644,384) P278,115 P− P− P− P278,115 P234,867 P4,521,109
Present value of
defined benefit
obligation 3,851,428 302,347 148,206 450,553 (P644,384) − 72,293 165,252 15,900 253,444 − 3,911,041
Net defined benefit
asset P621,562 (P302,347) P31,316 (P271,031) P− P278,115 (P72,293) (P165,252) (P15,900) P24,671 P234,867 P610,068
*Presented under Compensation and fringe benefits in the statements of income.

Consolidated
2015
Remeasurements in other comprehensive income

Return on
plan assets Actuarial Actuarial
(excluding changes arising changes arising
Net benefit cost
amount from from changes Changes in
January 1, Current Net pension Benefits included experience in financial remeasurement Contribution December 31,
2015 service cost Net interest expense* paid in net interest) adjustments assumptions gains (losses) by employer 2015
(l) = a + b + e + f
(a) (c) (d) (e) = c + d (f) (g) (h) (i) (j) = g + h + i (k) +j+k
Fair value of plan
assets P4,678,994 P− P212,682 P212,682 (P253,042) (P402,428) P− P− (P402,428) P236,784 P4,472,990
Present value of
defined benefit
obligation 4,058,096 386,634 139,272 525,906 (253,042) − (257,512) (222,020) (479,532) − 3,851,428
Net defined benefit
asset P620,898 (P386,634) P73,410 (P313,224) P− (P402,428) P257,512 P222,020 P77,104 P236,784 P621,562
*Presented under Compensation and fringe benefits in the statements of income.

Parent Company
2016
Remeasurements in other comprehensive income

Return on
plan assets Actuarial Actuarial
(excluding changes arising changes arising
Net benefit cost amount from from changes Changes in
January 1, Current Net pension Benefits included experience in financial remeasurement Contribution December 31,
2016 service cost Net interest expense* paid in net interest) adjustments assumptions gains (losses) by employer 2016
(l) = a + b + e + f
(a) (c) (d) (e) = c + d (f) (g) (h) (i) (j) = g + h + i (k) +j+k
Fair value of plan
assets P3,892,350 P− P173,210 P173,210 (P183,784) P284,221 P− P− P284,221 P150,000 P4,315,997
Present value of
defined benefit
obligation 3,106,532 288,262 138,241 426,503 (183,784) 49,966 162,025 211,991 3,561,243
Net defined benefit
asset P785,818 P(288,262) P34,969 P(253,293) P− P284,221 (P49,966) P(162,025) P72,230 P150,000 P754,754
*Presented under Compensation and fringe benefits in the statements of income.

China Bank 181 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Parent Company
2015
Remeasurements in other comprehensive income

Return on
plan assets Actuarial Actuarial
(excluding changes arising changes arising
Net benefit cost amount from from changes Changes in
January 1, Current Net pension Benefits included experience in financial remeasurement Contribution December 31,
2015 service cost Net interest expense* paid in net interest) adjustments assumptions gains (losses) by employer 2015
(l) = a + b + e + f
(a) (c) (d) (e) = c + d (f) (g) (h) (i) (j) = g + h + i (k) +j+k
Fair value of plan
assets P4,234,605 P− P192,251 P192,251 (P209,041) (P377,193) P− P− (P377,193) P51,727 P3,892,349
Present value
of defined
benefit
obligation 3,307,934 294,405 104,755 399,160 (209,041) − (165,875) (225,647) (391,522) − 3,106,531
Net defined
benefit asset P926,671 (P294,405) P87,496 (P206,909) P− P(377,193) P165,875 P225,647 P14,329 P51,727 P785,818
*Presented under Compensation and fringe benefits in the statements of income.

The Parent Company does not expect to contribute to its defined benefit pension plan in 2017.

In 2016 and 2015, the major categories of plan assets as a percentage of the fair value of total plan assets are as follows:

Consolidated Parent Company

2016 2015 2016 2015
Parent Company shares (Note 28) 40.13% 36.77% 42.04% 42.26%
Equity instruments 21.76% 17.49% 22.18% 19.17%
Cash and cash equivalents 6.13% 16.44% 3.57% 6.70%
Debt instruments 16.19% 15.30% 15.67% 16.44%
Other assets 15.79% 14.00% 16.54% 15.43%
100.00% 100.00% 100.00% 100.00%

The following table shows the breakdown of fair value of the plan assets:

Consolidated Parent Company

2016 2015 2016 2015
Due from BSP P53,580 P189,819 P46,000 P187,484
Deposits in banks 223,432 545,480 108,259 73,437
Financial assets at FVPL 976,684 754,054 956,163 739,208
AFS financial assets
Quoted debt securities 555,553 566,644 515,123 545,799
Quoted equity securities 7,054 28,117 5,481 6,781
Parent Company shares 1,814,531 1,644,750 1,814,531 1,644,750
Investments in unit investment trust fund 167,840 109,098 152,278 85,382
Corporate bonds 8,750 8,750 8,750 8,750
Loans and receivable 553,339 454,738 552,379 453,881
Investment properties* 147,154 161,148 143,799 136,568
Other assets 13,284 10,392 13,234 10,309
P4,521,201 P4,472,990 P4,315,997 P3,892,349
* Investment properties comprise properties located in Manila.

The carrying value of the plan assets of the Group and Parent Company amounted to P4.52 billion and P4.32 billion, respectively, as of
December 31, 2016, and P4.47 billion and P3.89 billion, respectively, as of December 31, 2015.

China Bank 182 Annual Report 2016

The principal actuarial assumptions used in 2016 and 2015 in determining the retirement liability for the Group’s and Parent Company’s
retirement plans are shown below:

2016
Parent CBSI CIBI CBC-PCCI CBCC
Discount rate:
January 1 4.45% 4.99% 5.10% 5.10% –
December 31 4.79% 5.08% 5.14% 5.14% 5.19%
Salary increase rate 6.00% 6.00% 6.00% 6.00% 6.00%

2015
Parent CBSI PDB CIBI CBC-PCCI
Discount rate:
January 1 4.54% 4.66% 4.60% 4.49% 4.56%
December 31 4.45% 4.99% 4.23% 5.10% 5.10%
Salary increase rate 5.00% 5.00% 5.00% 5.00% 5.00%

The sensitivity analysis below has been determined based on the impact of reasonably possible changes of each significant assumption on the
defined benefit liability as of the end of the reporting period, assuming all other assumptions were held constant:

December 31, 2016 Parent CBSI CIBI CBC-PCCI CBCCC

Discount rate
(+1%) (P246,034) (P35,473) (P1,566) (P9,072) (P814)
(-1%) 330,859 45,560 2,073 12,454 1,025

Salary increase rate

(+1%) 310,338 43,290 1,946 11,854 983
(-1%) (237,969) (34,585) (1,522) (8,860) (799)

December 31, 2015 Parent CBSI CIBI CBC-PCCI CBCC

Discount rate
(+1%) (P186,222) (P41,329) (P1,072) (P3,644) P–
(-1%) 267,709 59,118 1,566 7,690 –

Salary increase rate

(+1%) 252,451 55,498 1,496 7,354 –
(-1%) (181,218) (40,226) (1,059) (3,596) –

The weighted average duration of the defined benefit obligation are presented below:

December 31, 2016 December 31, 2015

Parent Company 13 13
CBSI 18 18
CIBI 19 19
CBC-PCCI 19 19
CBCC 22 –

The maturity analyses of the undiscounted benefit payments as of December 31, 2016 and 2015 are as follows:

December 31, 2016 Parent CBSI CIBI CBC-PCCI CBCC

1 year and less P884,693 P9,290 P– P– P–
More than 1 year to 5 years 846,426 64,223 1,571 20,508 –
More than 5 years to 10 years 2,115,399 140,944 12,533 41,384 7,925
More than 10 years to 15 years 2,680,694 541,073 25,081 41,182 13,494
More than 15 years to 20 years 3,146,044 1,023,406 – 159,992 104,806
More than 20 years 21,735,037 8,360,827 393,003 1,173,627 275,604

China Bank 183 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

December 31, 2015 Parent CBSI CIBI CBC-PCCI CBCC

1 year and less P836,930 P72,141 P– P8,632 P–
More than 1 year to 5 years 634,991 183,285 1,385 19,074 –
More than 5 years to 10 years 1,719,371 295,106 8,509 32,982 –
More than 10 years to 15 years 2,426,865 560,349 16,035 13,614 –
More than 15 years to 20 years 2,340,344 1,126,570 2,048 98,631 –
More than 20 years 15,244,682 5,923,431 282,416 766,434 –

24. DERIVATIVE FINANCIAL INSTRUMENTS

Occasionally, the Parent Company enters into forward exchange contracts as an accommodation to its clients. These derivatives are not
designated as accounting hedges. The aggregate notional amounts of the outstanding buy US dollar currency forwards as of December 31,
2016 and 2015 amounted to US$148.58 million and US$287.67 million, respectively, while the sell US dollar forward contracts amounted to
US$197.06 million and US$440.00 million, respectively. Weighted average buy US dollar forward rate as of December 31, 2016 and 2015 is
P46.76, while the weighted average sell US dollar forward rates are P44.26 and P47.32, respectively.

The aggregate notional amounts of the outstanding buy Euro currency forwards as of December 31, 2016 and 2015 amounted to €2 million and
nil, respectively while the aggregate notional amounts of the outstanding sell Euro currency forwards as of the December 31, 2016 and 2015
amounted to €6 million and €241.02 million, respectively. The weighted average buy Euro forward rates as of December 31, 2016 P53.40 while
the weighted average sell Euro forward rate as of December 31, 2016 and 2015 are P51.85 and P51.68, respectively.

The aggregate notional amounts of the outstanding buy Hong Kong dollars (HKD) currency forwards as of December 31, 2016 amounted to
HKD155.15 million. The weighted average buy HKD forward rates as of December 31, 2016 is P6.41.

The aggregate notional amounts of the outstanding sell Chinese Yuan (CNY) currency forwards as of December 31, 2016 amounted to
CNY34.91 million. The weighted average sell CNYforward rates as of December 31, 2016 is P7.12.

The aggregate notional amounts of the outstanding IRS as of December 31, 2016 and 2015 amounted to P10.82 billion and P6.95 billion,
respectively.

As of December 31, 2016 and 2015, the fair values of derivatives follow:

2016 2015
Derivative Derivative Derivative Derivative
Asset Liability Asset Liability
Currency forwards P176,513 P213,788 P283,112 P35,876
IRS 30,065 29,410 7,624 30,497
Warrants 9,710 – 9,190 –
P216,288 P243,198 P299,926 P66,373

Fair Value Changes of Derivatives

The net movements in fair value changes of derivative instruments are as follows:

2016 2015
Balance at beginning of year P233,553 P187,947
Fair value changes during the year (183,640) 316,442
Settled transactions (76,823) (270,836)
Balance at end of year (P26,910) P233,553

The net movements in the value of the derivatives are presented in the statements of income under the following accounts:

2016 2015 2014

Foreign exchange gain (loss) (P283,994) P47,031 (P155,824)
Trading and securities gain (loss)* (Note 20) 23,510 (1,425) 3,065
(P260,484) P45,606 (P152,759)
*Net movements in the value related to embedded credit derivatives and IRS.

China Bank 184 Annual Report 2016

25. LEASE CONTRACTS

The lease contracts are for periods ranging from one to 25 years from the dates of contracts and are renewable under certain terms and
conditions. Various lease contracts include escalation clauses, most of which bear an annual rent increase of 5.00% to 10.00%.

Annual rentals on these lease contracts included in ‘Occupancy cost’ in the statements of income in 2016, 2015 and 2014 amounted to
P681.05 million, P615.00 million and P522.00 million, respectively, for the Group, and P450.53 million, P396.88 million and P349.00 million,
respectively, for the Parent Company.

Future minimum rentals payable of the Group and the Parent Company under non-cancelable operating leases follow:

Consolidated Parent Company

2016 2015 2016 2015
Within one year P573,623 P468,972 P506,446 P394,965
After one year but not more than five years 1,900,916 1,465,118 1,677,595 1,204,976
After five years 1,152,237 785,931 724,682 484,064
P3,626,776 P2,720,021 P2,908,723 P2,084,005

The Group and the Parent Company have also entered into commercial property leases on its investment properties (Note 12).

Future minimum rentals receivable under noncancellable operating leases follow:

Consolidated Parent Company

2016 2015 2016 2015
Within one year P5,044 P5,465 P4,865 P2,792
After one year but not more than five years 22,047 38,575 2,977 5,670
After more than five years 27,653 23,867 − −
P54,743 P67,907 P7,842 P8,462

26. INCOME AND OTHER TAXES

Income taxes include corporate income tax and FCDU final taxes, as discussed below, and final tax paid at the rate of 20.00% on gross interest
income from government securities and other deposit substitutes. These income taxes, as well as the deferred tax benefits and provisions, are
presented as ‘Provision for income tax’ in the statements of income.

Republic Act (RA) No. 9337, An Act Amending National Internal Revenue Code, provides that RCIT rate shall be 30.00% while interest expense
allowed as a deductible expense is reduced to 33.00% of interest income subject to final tax.

An MCIT of 2.00% on modified gross income is computed and compared with the RCIT. Any excess MCIT over RCIT is deferred and can be
used as a tax credit against future income tax liability for the next three years. In addition, the NOLCO is allowed as a deduction from taxable
income in the next three years from the year of inception.

Effective in May 2004, RA No. 9294 restored the tax exemption of FCDUs and offshore banking units (OBUs). Under such law, the income
derived by the FCDU from foreign currency transactions with nonresidents, OBUs, local commercial banks including branches of foreign banks
is tax-exempt while interest income on foreign currency loans from residents other than OBUs or other depository banks under the expanded
system is subject to 10.00% gross income tax.

Interest income on deposit placements with other FCDUs and OBUs is taxed at 7.50%, while all other income of the FCDU is subject to the
30.00% corporate tax.

On March 15, 2011, the BIR issued Revenue Regulation (RR) No. 4-2011 which prescribes the attribution and allocation of expenses between
FCDUs/EFCDUs or OBU and RBU and within RBU. Pursuant to the regulations, the Parent Company made an allocation of its expenses in
calculating income taxes due for RBU and FCDU.

Current tax regulations also provide for the ceiling on the amount of entertainment, amusement and recreation (EAR) expense that can be
claimed as a deduction against taxable income. Under the regulations, EAR expense allowed as a deductible expense is limited to the actual
EAR paid or incurred but not to exceed 1.00% of the Parent Company’s net revenue.

China Bank 185 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

The provision for income tax consists of:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Current
Final tax P498,750 P435,649 P575,434 P458,011 P417,227 P472,387
RCIT 907,782 1,007,447 888,188 785,800 941,923 871,033
MCIT – 29,935 34,693 – – –

1,406,532 1,243,811
1,473,031 1,498,315 1,359,150 1,343,420
Deferred (279,980) (663,062) 66,612 (160,672) (531,080) 65,412
P1,126,552 P809,969 P1,564,927 P1,083,139 P828,070 P1,408,832

The details of net deferred tax assets (liabilities) follow:

Consolidated Parent Company

2016 2015 2016 2015
Deferred tax assets (liabilities) on
Allowance for impairment and credit losses P2,429,146 P2,149,489 P2,249,967 P2,123,705
Revaluation increment on land (547,405) (547,405) (547,405) (547,405)
Fair value adjustment on asset foreclosure and dacion
(91,030) (34,821) 32,014 28,592
transactions - net of depreciated portion
Net defined benefit asset (183,020) (186,469) (226,426) (235,745)
Fair value adjustments on net assets (liabilities) of PDB and
(1,102,839) (1,115,661) – –
Unity Bank
P504,852 P265,133 P1,508,150 P1,369,147

The Group did not set up deferred tax assets on the following temporary differences as it believes that it is highly probable that these temporary
differences will not be realized in the near foreseeable future:

Consolidated Parent Company

2016 2015 2016 2015

Allowance for impairment and credit losses P909,699 P1,969,250 P98,262 P979,955
NOLCO 228,929 467,368 − −
Excess of MCIT over RCIT 40,339 97,607 − −
Accrued compensated absences 32,416 291,386 53,003 65,993
Others 62,280 43,688 − −
P1,273,663 P2,869,299 P151,265 P1,045,948

As of December 31, 2015, details of the Group’s NOLCO are as follows:

Original Used Remaining Expiry

Inception Year Amount Amount Expired Amount Balance Year
2013 P238,439 P− P238,439 P− 2016
2014 177,085 − − 177,085 2017
2015 51,844 − − 51,844 2018
P467,368 P− P238,439 P228,929

China Bank 186 Annual Report 2016

 As of December 31, 2016, details of the excess of MCIT over RCIT of the Group follow:

Original Used Remaining Expiry

Inception Year Amount Amount Expired Amount Balance Year
2013 P37,783 P37,783 P− P− 2016
2014 37,001 19,485 − 17,516 2017
2015 22,823 − − 22,823 2018
P97,607 P− P− P40,339

The reconciliation of the statutory income tax to the provision for income tax follows:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Statutory income tax P2,276,256 P1,923,764 P2,003,974 P2,262,431 P2,002,359 P1,957,021
Tax effects of -
FCDU income (549,881) (459,351) (524,178) (543,591) (472,787) (479,306)
Non-taxable income (219,042) (300,817) (618,351) (179,507) (330,074) (349,137)
Interest income subjected to final tax (464,491) (168,700) (453,824) (604,445) (180,071) (230,809)
Nondeductible expenses 243,937 (63,433) 1,234,635 146,205 (232,661) 532,835
Others (160,227) (121,494) (77,329) 2,046 41,304 (21,772)
Provision for income tax P1,126,552 P809,969 P1,564,927 P1,083,139 P828,070 P1,408,832

27. TRUST OPERATIONS

Securities and other properties (other than deposits) held by the Parent Company in fiduciary or agency capacities for clients and beneficiaries
are not included in the accompanying balance sheets since these are not assets of the Parent Company (Note 29).

In compliance with the requirements of current banking regulations relative to the Parent Company’s trust functions: (a) government
bonds included under HFT financial assets and AFS financial assets with total face value of P994.05 million and P250.62 million as of
December 31, 2016 and 2015, respectively, are deposited with the BSP as security for the Parent Company’s faithful compliance with its
fiduciary obligations (Note 8); and (b) a certain percentage of the Parent Company’s trust fee income is transferred to surplus reserve. This yearly
transfer is required until the surplus reserve for trust function equals 20.00% of the Parent Company’s authorized capital stock.

28. RELATED PARTY TRANSACTIONS

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence
over the other party in making financial and operating decisions. The Group’s related parties include:
• key management personnel, close family members of key management personnel and entities which are controlled, significantly influenced
by or for which significant voting power is held by key management personnel or their close family members,
• significant investors
• subsidiaries, joint ventures and associates and their respective subsidiaries, and
• post-employment benefit plans for the benefit of the Group’s employees.

The Group has several business relationships with related parties. Transactions with such parties are normally made in the ordinary course of
business and based on the terms and conditions discussed below.

Transactions with Retirement Plans

Under PFRS, certain post-employment benefit plans are considered as related parties. The Group has business relationships with a number
of its retirement plans pursuant to which it provides trust and management services to these plans. Income earned by the Group and
Parent Company from such services amounted to P44.35 million and P41.41 million, respectively, in 2016, P44.19 million and P41.35 million,
respectively, in 2015, and P46.91 million and P44.05 million, respectively, in 2014. The Group’s retirement funds may hold or trade the Parent
Company’s shares or securities. Significant transactions of the retirement fund, particularly with related parties, are approved by the Trust
Investment Committee (TIC) of the Parent Company. The members of the TIC are directors and key management personnel of the Parent
Company.

China Bank 187 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

A summary of transactions with related party retirement plans follows:

Consolidated Parent Company

2016 2015 2016 2015
Deposits in banks P223,432 P75,278 P108,259 P73,437
AFS financial assets 1,814,531 1,644,750 1,814,531 1,644,750
Dividend income 44,214 40,939 44,214 40,939
Interest income 2,069 697 1,172 511
Total market value of shares 1,814,531 1,644,750 1,814,531 1,644,750
Number of shares held 47,751 44,214 47,751 44,214

In 2014, dividend income and interest income of the retirement plan from investments and placements in the Parent Company amounted to
P37.91 million and P0.73 million, respectively, for the Group, and P37.91 million and P0.66 million, respectively, for the Parent Company.

AFS financial assets represent shares of stock of the Parent Company. Voting rights over the Parent Company’s shares are exercised by an
authorized trust officer.

Remunerations of Directors and other Key Management Personnel

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the
Group, directly or indirectly. The Group considers the members of the ManCom to constitute key management personnel for purposes of
PAS 24.

Total remunerations of key management personnel are as follows:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Short-term employee benefits P380,394 P411,833 P400,318 P315,284 P325,324 P313,469
Post-employment benefits 4,774 6,526 7,646 2,194 3,946 3,645
P385,168 P418,359 P407,964 P317,478 P329,270 P317,114

Members of the BOD are entitled to a per diem of P500.00 for attendance at each meeting of the Board or of any committees and to four
percent of the Parent Company’s net earnings, with certain deductions in accordance with BSP regulation. Non-executive directors do not
receive any performance-related compensation. Directors’ remuneration covers all Parent Company’s Board activities and membership of
committees and subsidiary companies.

The Group also provides banking services to directors and other key management personnel and persons connected to them. These
transactions are presented in the tables below.

Other Related Party Transactions

Transactions between the Parent Company and its subsidiaries meet the definition of related party transactions. Transactions between the
Group and its associated companies also qualify as related party transactions. Details of the Parent Company’s subsidiaries and associate are
disclosed in Notes 1 and 10.

Group
Related party transactions of the Group by category of related party are presented below.

December 31, 2016

Category Amount / Volume Outstanding Terms and Conditions
Balance
Significant Investor
Loans and receivables P2,710,000 These are secured loans with interest rate of 5.13% and
Issuances P– maturity of four years; collateral includes shares of stocks
Repayments – with fair value of P28.44 billion.
Deposit liabilities 223 These are checking accounts with annual average rate of
Deposits 2,053,853 0.13%.
Withdrawals (10,270,042)
Associate
Deposit liabilities 288,072 These are savings accounts with annual average interest
Deposits 437,486 rates ranging from 0.25% to 1.00%.
Withdrawals (1,097,863)

China Bank 188 Annual Report 2016

 December 31, 2016
Category Amount / Volume Outstanding Terms and Conditions
Balance
Key Management Personnel
Loans and receivables 11,703 This includes secured and unsecured loans amounting to
Issuances 557 P16.12 million and P8.02 million, respectively. Secured
Repayments 8,463 loans bear annual interest rate of 6.00% and maturity of
15 years. Collateral includes real properties with fair value
of P32.82 million.
Deposit liabilities 15,830 These are checking, savings and time deposits with annual
Deposits 209,071 average interest rates ranging from 0.25% to 1.00%.
Withdrawals (228,679)
Other Related Parties
Deposit liabilities 22,019 These are checking and savings accounts with annual
Deposits 8,122,268 average interest rates ranging from 0.13% to 1.00%.
Withdrawals (33,781,787)

December 31, 2015

Category Amount / Volume Outstanding Terms and Conditions
Balance
Significant Investor
Loans and receivables P2,710,000 These are secured loans with interest rate of 5.13% and
Issuances P– maturity of five years; collateral includes shares of stocks
with fair value of P22.11 billion.
Repayments (290,000)
Deposit liabilities 8,216,412 These are checking accounts with annual average interest rate
Deposits 3,633,465 of 0.13%.
Withdrawals –
Associate
Deposit liabilities 948,449 These are savings accounts with annual average interest rates
Deposits 61,703 ranging from 0.25% to 1.00%.
Withdrawals (93,953)
Key Management Personnel
Loans and receivables 16,121 These are secured loans with interest rates ranging from 5.50%
Issuances 7,901 to 8.00% and maturity of 15 years. Collateral includes real
properties with fair value of P31.08 million.
Repayments (13,458)
Deposit liabilities 35,438 These are checking, savings and time eposit accounts with
Deposits 106,168 annual average interest rates ranging from 0.25% to 1.00%.
Withdrawals (107,432)
Other Related Parties
Deposit liabilities 25,681,538 These are checking and savings accounts with annual average
Deposits 49,896 interest rates ranging from 0.13% to 1.00%.
Withdrawals (4,029,046)

Interest income earned and interest expense incurred from the above loans and deposit liabilities in 2016, 2015, and 2014 follow:

Significant Investor Associate

2016 2015 2014 2016 2015 2014
Interest income P138,944 P142,662 P146,695 P– P1,288 P14,341
Interest expense 12 8 1 1,513 2,411 1,332

Key Management Personnel Other Related Parties

2016 2015 2014 2016 2015 2014
Interest income P– P1,039 P1,133 P– P– P42,660
Interest expense 40 1,270 466 11 125 199

China Bank 189 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Related party transactions of the Group with significant investor, associate and other related parties pertain to transactions of the Parent
Company with these related parties.

Parent Company
Related party transactions of the Parent Company by category of related party, except those already presented in the Group disclosures, are
presented below.

December 31, 2016

Category Amount / Volume Outstanding Balance Nature, Terms and Conditions
Subsidiaries
Deposit liabilities P14,218 These are checking and savings accounts with annual
Deposits P273,603 average interest rates ranging from 0.13% to 1.00%.
Withdrawals (6,767,542)
Associate
Deposit liabilities 288,072 These are savings accounts with annual average
Deposits 437,486 interest rates ranging from 0.25% to 1.00%.
Withdrawals (4,700,011)
Key Management Personnel
Loans and receivables 1,249 Loans with interest rates ranging from 6.00% to 8.00%
Issuances 557 and maturity of 15 years.
Repayments (1,060)
Deposit liabilities 15,830 These are savings account with annual average interest
Deposits 209,071 rates ranging from 0.25% to 1.00%.
Withdrawals (206,142)
Other Related Parties
Deposit liabilities 22,019 These are checking and savings accounts with annual
Deposits 8,122,268 average interest rates ranging from 0.13% to 1.00%.
Withdrawals (33,709,401)

December 31, 2015

Category Amount / Volume Outstanding Balance Nature, Terms and Conditions
Subsidiaries
Deposit liabilities P6,508,157 These are checking and savings accounts with annual
Deposits P35,001 average interest rates ranging from 0.13% to 1.00%.
Withdrawals (50,340)
Associate
Deposit liabilities 4,550,697 These are savings accounts with annual average
Deposits 61,703 interest rates ranging from 0.25% to 1.00%.
Withdrawals (93,953)
Key Management Personnel
Loans and receivables 1,752 Loans with interest rates ranging from 6.00% to
Issuances 453 8.00% and maturity of 15 years.
Repayments (856)
Deposit liabilities 12,901 These are savings accounts with annual average
Deposits 99,867 interest rates ranging from 0.25% to 1.00%.
Withdrawals (100,466)
Other Related Parties
Deposit liabilities 25,609,152 These are checking and savings accounts with annual
Deposits 12,718 average interest rates ranging from 0.13% to 1.00%.
Withdrawals (4,029,046)

In 2015, PDB sold its investment property to the Parent Company for a total selling price of P464.52 million. PDB recognized gain on such
sale amounting to P55.30 million. PDB’s gain on sale was eliminated at the group level. In addition, CBSI assigned its portfolio of receivables
to PDB amounting to P2.83 billion.

China Bank 190 Annual Report 2016

The related party transactions shall be settled in cash. There are no provisions for credit losses in 2016, 2015 and 2014 in relation to amounts
due from related parties.

Interest income earned and interest expense incurred from the above loans and deposit liabilities in 2016, 2015 and 2014 follow:

Subsidiaries Associate
2016 2015 2014 2016 2015 2014
Interest expense P33 P137 P203 P1,513 P19 P1,081

Key Management Personnel Other Related Parties

2016 2015 2014 2016 2015 2014
Interest income P56 P78 P98 P– P– P42,660
Interest expense 40 76 55 11 27 106

Outstanding loan balances with related parties are unimpaired as at year-end, thus no impairment allowance was recorded.

Outright purchases and outright sale of debt securities of the Parent Company with its subsidiaries in 2016 and 2015 follow:

Subsidiaries
2016 2015
Peso-denominated
Outright purchase P1,504,879 P277,420
Outright sale 1,128,000 603,000
Dollar-denominated
Outright purchase − US$9,000
Outright sale − 5,934

The following table shows the amount and outstanding balance of other related party transactions included in the financial statements:

Subsidiaries
2016 2015 Nature, Terms and Conditions
Balance Sheet
Accounts receivable P5,187 P3,301 This pertains to various expenses advanced by CBC in behalf of CBSI
Security deposits 3,050 2,445 This pertains to the rental deposits with CBSI for office space leased out
to the Parent Company
Accounts payable 10,623 3,303 This pertains to various unpaid rental to CBSI

Subsidiaries
2016 2015 2014 Nature, Terms and Conditions
Income Statement
Miscellaneous income P1,800 P1,800 P1,800 Human resources functions provided by the Parent
Company to its subsidiaries (except CBC Forex and
Unity Bank) such as recruitment and placement, training
and development, salary and benefits development,
systems and research, and employee benefits. Under
the agreement between the Parent Company and
its subsidiaries, the subsidiaries shall pay the Parent
Company an annual fee
Occupancy cost 22,255 16,266 16,411 Certain units of the condominium owned by CBSI are
being leased to the Parent Company for a term of five
years, with no escalation clause
Miscellaneous expense 229,592 122,260 103,364 This pertains to the computer and general banking
services provided by CBC-PCCI to the Parent
Company to support its reporting requirements

China Bank 191 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

Regulatory Reporting
As required by the BSP, the Group discloses loan transactions with its and affiliates and investees and with certain directors, officers, stockholders
and related interests (DOSRI). Under existing banking regulations, the limit on the amount of individual loans to DOSRI, of which 70.00% must
be secured, should not exceed the regulatory capital or 15.00% of the total loan portfolio, whichever is lower. These limits do not apply to loans
secured by assets considered as non-risk as defined in the regulations.

BSP Circular No. 423, dated March 15, 2004, amended the definition of DOSRI accounts. The following table shows information relating to
the loans, other credit accommodations and guarantees classified as DOSRI accounts under regulations existing prior to said Circular, and new
DOSRI loans, other credit accommodations granted under said Circular:

Consolidated Parent Company

2016 2015 2016 2015
Total outstanding DOSRI loans P7,023,635 P5,022,503 P7,015,002 P4,997,513
Percent of DOSRI loans granted under regulations existing prior to
− − − −
BSP Circular No. 423
Percent of DOSRI loans granted under BSP Circular No. 423 − − − −
Percent of DOSRI loans to total loans 1.81% 1.59% 2.12% 1.88%
Percent of unsecured DOSRI loans to total DOSRI loans 5.99% 3.05% 5.98% 3.02%

The amounts of loans disclosed for related parties above differ with the amounts disclosed for key management personnel since the composition
of DOSRI is more expansive than that of key management personnel.

BSP Circular No. 560 provides that the total outstanding loans, other credit accommodation and guarantees to each of the bank’s/quasi-bank’s
subsidiaries and affiliates shall not exceed 10.00% of the net worth of the lending bank/quasi-bank, provided that the unsecured portion of
which shall not exceed 5.00% of such net worth. Further, the total outstanding loans, credit accommodations and guarantees to all subsidiaries
and affiliates shall not exceed 20.00% of the net worth of the lending bank/quasi-bank; and the subsidiaries and affiliates of the lending bank/
quasi-bank are not related interest of any director, officer and/or stockholder of the lending institution, except where such director, officer or
stockholder sits in the BOD or is appointed officer of such corporation as representative of the bank/quasi-bank.

On May 12, 2009, BSP issued Circular No. 654 allowing a separate individual limit of twenty‑five (25.00%) of the net worth of the lending bank/
quasi-bank to loans of banks/quasi-banks to their subsidiaries and affiliates engaged in energy and power generation.

29. COMMITMENTS AND CONTINGENT ASSETS AND LIABILITIES

In the normal course of the Group’s operations, there are various outstanding commitments and contingent liabilities which are not reflected in
the accompanying financial statements. Management does not anticipate any material losses as a result of these transactions.

The following is a summary of contingencies and commitments of the Group and the Parent Company with the equivalent peso contractual
amounts:

Consolidated Parent Company

2016 2015 2016 2015
Trust department accounts (Note 27) P104,373,741 P82,677,515 P102,862,792 P78,663,914
Future exchange sold 11,267,749 21,031,257 11,267,749 21,031,257
Unused commercial letters of credit (Note 28) 17,801,390 18,440,951 17,801,205 18,431,395
IRS receivable 10,823,400 6,950,000 10,823,400 6,950,000
Future exchange bought 8,922,411 13,407,792 8,922,411 13,407,792
Credit card lines 8,883,196 7,435,851 8,883,196 7,435,851
Standby credit commitment 3,029,782 3,259,734 3,029,782 3,259,734
Outstanding guarantees issued 4,827,530 5,725,655 1,140,440 792,581
Spot exchange sold 558,487 753,930 558,487 753,930
Spot exchange bought 409,940 1,130,390 409,940 1,130,390
Late deposits/payments received 417,559 245,924 405,838 210,993
Deficiency claims receivable 294,632 297,073 294,632 297,073
Inward bills for collection 234,588 144,155 234,588 144,155
Outward bills for collection 73,702 76,230 57,227 74,508
Others 2,575 14,125 2,348 13,991

China Bank 192 Annual Report 2016

30. SEGMENT INFORMATION

The Group’s operating businesses are recognized and managed separately according to the nature of services provided and the markets
served, with each segment representing a strategic business unit. In 2014, the Group’s organization structure was realigned in a manner that
caused the composition of its reportable segments to change. From four major groups (Consumer Banking, Institutional Banking, Branch
Banking and Treasury), the Group now has three major business segments, namely:

The Group’s business segments are as follows:

a. Lending Business – principally handles all the lending, trade finance and corollary banking products and services offered to corporate
and institutional customers as well as selected middle market clients. It also handles home loans, contract-to-sell receivables and auto
loans for individual and corporate customers. Aside from the lending business, it also provides cash management services and remittance
transactions;

b. Retail Banking Business – principally handles retail and commercial loans, individual and corporate deposits, overdrafts and funds transfer
facilities, trade facilities and all other services for retail customers;

c. Financial Capital Markets and Investments – principally provides money market, trading and treasury services, manages the Group’s
funding operations by the use of government securities, placements and acceptances with other banks as well as offers advisory and
capital-raising services to corporate clients and wealth management services to high-net-worth customers; and

d. Others – handles other services including but not limited to trust and investment management services, asset management, insurance
brokerage, credit management, thrift banking business, operations and financial control, and other support services.

The Group’s businesses are organized to cater to the banking needs of market segments, facilitate customer engagement, ensure timely delivery
of products and services as well as achieve cost efficiency and economies of scale. Accordingly, the corresponding segment information for all
periods presented herein are restated to reflect such change.

The Group reports its primary segment information to the Chief Operating Decision Maker (CODM) on the basis of the above-mentioned
segments. The CODM of the Group is the President and Chief Executive Officer.

Segment assets are those operating assets that are employed by a segment in its operating activities that are either directly attributable to the
segment or can be allocated to the segment on a reasonable basis.

Segment liabilities are those operating liabilities that result from the operating activities of a segment and that either are directly attributable to
the segment or can be allocated to the segment on a reasonable basis.

Interest income is reported net as management primarily relies on the net interest income as performance measure, not the gross income and
expense.

The segment results include internal transfer pricing adjustments across business units as deemed appropriate by management. Transactions
between segments are conducted at estimated market rates on an arm’s length basis. Interest is charged/credited to the business units based
on a pool rate which approximates the marginal cost of funds.

Other operating income mainly consists of trading and securities gain (loss) - net, service charges, fees and commissions, trust fee income and
foreign exchange gain - net. Other operating expense mainly consists of compensation and fringe benefits, provision for impairment and credit
losses, taxes and licenses, occupancy, depreciation and amortization, stationery, supplies and postage and insurance. Other operating income
and expense are allocated between segments based on equitable sharing arrangements.

The Group has no significant customers which contributes 10.00% or more of the consolidated revenues.

The Group’s asset producing revenues are located in the Philippines (i.e., one geographical location); therefore, geographical segment
information is no longer presented.

China Bank 193 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

The following tables present relevant financial information regarding business segments measured in accordance with PFRS as of and for the
years ended December 31, 2016, 2015 and 2014 (with corresponding items of segment information for earlier periods restated to reflect the
new composition of reportable segments):

Lending Business Retail Banking Business

2016 2015 2014 2016 2015 2014
Results of Operations
Net interest income
Third party P11,234,520 P9,884,601 P8,972,673 P477,635 P247,320 (P187,269)
Intersegment (6,185,045) (5,226,806) (3,102,914) 7,067,165 6,377,212 4,564,274
5,049,475 4,657,795 5,869,759 7,544,800 6,624,532 4,377,005
Other operating income 907,182 885,555 633,077 1,234,356 1,420,568 1,296,578
Total revenue 5,956,657 5,543,350 6,502,836 8,779,156 8,045,100 5,673,583
Other operating expense (2,228,638) (1,361,427) (1,172,810) (5,759,880) (5,472,577) (5,109,623)
Income before income tax 3,728,019 4,181,923 5,330,026 3,019,276 2,572,523 563,960
Provision for income tax 96,461 − (3,612) (6,833) (5,000) (6,550)
Net income P3,824,480 P4,181,923 P5,326,414 P3,012,443 P2,567,523 P557,410
Total assets P251,890,331 P200,906,783 P196,097,393 P361,036,278 P124,073,281 P239,928,734
Total liabilities P2,233,433 P1,050,634 P775,648 P365,417,688 P336,671,277 P296,507,001
Depreciation and amortization P51,266 P39,019 P21,879 P313,745 P300,010 P309,589
Provision for impairment and
credit losses P916,974 P258,725 P377,664 P126,025 P217,447 P264,341
Capital expenditures P451,770 P15,713 P9,341 P647,525 P15,880 P92,164

Financial Capital Markets and Investments Other Business and Support Units
2016 2015 2014 2016 2015 2014
Results of Operations
Net interest income
Third party P2,039,741 P2,446,783 P2,599,321 2,942,296 P2,506,480 P2,704,022
Intersegment (424,779) (567,059) (541,263) (457,341) (583,347) (920,097)
1,614,962 1,879,724 2,058,058 2,484,955 1,923,133 1,783,925
Other operating income 1,386,223 1,393,658 1,413,239 1,566,985 787,361 1,416,383
Total revenue 3,001,185 3,273,382 3,471,297 4,051,943 2,710,494 3,200,308
Other operating expense (959,151) (651,534) (601,704) (5,253,750) (5,674,243) (5,283,975)
Income before income tax 2,042,034 2,621,848 2,869,593 (1,201,807) (2,963,749) (2,083,667)
Provision for income tax (388,807) (357,864) (451,402) (827,373) (447,105) (1,103,363)
Net income P1,653,227 P2,263,984 P2,418,191 (P2,029,180) (P3,410,854) (P3,187,030)
Total assets P128,281,917 P104,004,670 P69,282,581 (P108,010,515) P97,842,229 (P34,087,895)
Total liabilities P124,409,814 P59,108,627 P43,584,546 P77,750,872 P70,825,521 P73,786,135
Depreciation and amortization P30,449 P20,199 P13,950 P729,326 P620,184 P576,346
Provision for impairment and
credit losses P– P– P– (P192,453) P490,402 (P201,104)
Capital expenditures P230,076 P8,799 P66,145 (P193,719) P1,453,590 P896,254

China Bank 194 Annual Report 2016

 Total
2016 2015 2014
Results of Operations
Net interest income
Third party P16,694,192 P15,085,184 P14,088,747
Intersegment − − −
16,694,192 15,085,184 14,088,747
Other operating income 5,094,746 4,487,142 4,759,277
Total revenue 21,788,941 19,572,326 18,848,024
Other operating expense (14,201,419) (13,159,781) (12,168,112)
Income before income tax 7,587,522 6,412,545 6,679,912
Provision for income tax (1,126,552) (809,969) (1,564,927)
Net income P6,460,970 P5,602,576 P5,114,985
Total assets P633,198,011 P526,826,963 P471,220,813
Total liabilities P569,811,807 P467,656,059 P414,653,330
Depreciation and amortization P1,124,786 P979,412 P921,764
Provision for impairment and credit losses P850,546 P966,574 P440,901
Capital expenditures P1,135,652 P1,493,982 P1,063,904

The Group’s share in net loss of an associate included in other operating income amounting to P89.38 million, P37.89 million and P0.91 million
in 2016, 2015 and 2014, respectively are reported under ‘Other Business and Support Units’.

31. EARNINGS PER SHARE

Basic EPS amounts are calculated by dividing the net income for the year by the weighted average number of common shares outstanding
during the year (adjusted for stock dividends).

The following reflects the income and share data used in the basic earnings per share computations:

2016 2015 2014

a. Net income attributable to equity holders
of the parent P6,458,296 P5,606,666 P5,117,832
b. Weighted average number of common
shares outstanding (Note 22) 2,002,028 2,002,028 2,002,028
c. EPS (a/b) P3.23 P2.80 P2.56

As of December 31, 2016, 2015 and 2014, there were no outstanding dilutive potential common shares. Before consideration of the 8.00%
stock dividends distributed in 2016, the EPS for 2015 and 2014 were P3.02 and P2.76, respectively.

32. FINANCIAL PERFORMANCE

The following basic ratios measure the financial performance of the Group and the Parent Company:

Consolidated Parent Company

2016 2015 2014 2016 2015 2014
Return on average equity 10.42% 9.62% 9.91% 10.32% 9.57% 9.91%
Return on average assets 1.16% 1.17% 1.12% 1.33% 1.35% 1.30%
Net interest margin 3.20% 3.37% 3.30% 3.03% 3.20% 3.20%

China Bank 195 Annual Report 2016

NOTES TO FINANCIAL STATEMENTS

33. NON-CASH INVESTING ACTIVITIES

The following is a summary of certain non-cash investing activities that relate to the analysis of the statements of cash flows:

Consolidated
2016 2015 2014
Addition to investment properties from settlement of loans P784,415 P960,332 P1,485,082
Fair value gain in AFS financial assets 405,722 (610,521) 202,452
Addition to equity investment − − 145,028
Cumulative translation adjustment (3,637) (16,734) (86,686)
Addition to chattel mortgage from settlement of loans 334,553 112,056 22,943

Parent Company
2016 2015 2014
Addition to investment properties from settlement of loans P296,844 P257,851 P498,255
Fair value gain in AFS financial assets 405,722 (464,471) 188,354
Addition to equity investment − − 145,028
Cumulative translation adjustment (3,637) (14,914) (87,715)
Addition to chattel mortgage from settlement of loans 19,088 2,244 7,817

34. OFFSETTING OF FINANCIAL ASSETS AND LIABILITIES

The amendments to PFRS 7 require the Group to disclose information about rights of offset and related arrangements (such as collateral
posting requirements) for financial instruments under an enforceable master netting agreements or similar arrangements. The effects of these
arrangements are disclosed in the succeeding table.

December 31, 2016

Effects of remaining rights of
set-off (including rights to set
Net amount off financial collateral) that
Gross amounts presented in do not meet PAS 32 offsetting
Financial instruments offset in statements of criteria
recognized at Gross carrying accordance with financial Fair value of
end of reporting amounts (before the offsetting position Financial financial Net exposure
period by type offsetting) criteria [a-b] instruments collateral [c-d]
[a] [b] [c] [d] [e]
Financial assets
Currency forwards P17,631 P− P17,631 P17,310 P− P321
IRS 30,065 − 30,065 16,496 − 13,569
P47,696 P− P47,696 P33,807 P− P13,890

Financial liabilities
Bills payable P8,072,782 P− P8,072,782 P9,520,216 P8,943,902 P−
Currency forwards 67,611 − 67,611 17,310 − 50,301
IRS 29,410 − 29,410 16,496 − 12,913
P8,169,802 P− P8,169,802 P9,554,023 P8,943,902 P63,214

China Bank 196 Annual Report 2016

 December 31, 2015
Effects of remaining rights of
set-off (including rights to set
Net amount off financial collateral) that
Gross amounts presented in do not meet PAS 32 offsetting
Financial instruments offset in statements of criteria
recognized at Gross carrying accordance with financial Fair value of
end of reporting amounts (before the offsetting position Financial financial Net exposure
period by type offsetting) criteria [a-b] instruments collateral [c-d]
[a] [b] [c] [d] [e]
Financial assets
Currency forwards P109,265 P− P109,265 P2,926 P− P106,339
IRS 7,624 − 7,624 7,243 − 381
P116,889 P− P116,889 P10,169 P− P106,720

Financial liabilities
Bills payable P11,053 P− P11,053 P12,806 P561,212 P−
Currency forwards 2,926 − 2,926 2,926 − −
IRS 30,497 − 30,497 7,243 20,267 2,987
P44,476 P− P44,476 P22,975 P581,479 P2,987

The amounts disclosed in column (d) include those rights to set-off amounts that are only enforceable and exercisable in the event of default,
insolvency or bankruptcy. These include amounts related to financial collateral both received and pledged, whether cash or non-cash collateral,
excluding the extent of over-collateralization.

35. APPROVAL OF THE FINANCIAL STATEMENTS

The accompanying consolidated and parent company financial statements were authorized for issue by the Parent Company’s BOD on
March 1, 2017.

36. SUPPLEMENTARY INFORMATION REQUIRED UNDER RR NO. 15-2010

In compliance with the requirements set forth by RR 15-2010, hereunder are the details of percentage and other taxes paid or accrued by the
Parent Company in 2016.

Gross receipts tax P811,167

Documentary stamps tax 607,134
Local taxes 62,622
Fringe benefit tax 5,774
Others 20,112
Balance at end of year P1,506,809

Withholding Taxes
Details of total remittances of withholding taxes in 2016 and amounts outstanding as of December 31, 2016 are as follows:

Total Amounts
remittances outstanding
Final withholding taxes P667,372 P66,798
Withholding taxes on compensation and benefits 568,624 36,054
Expanded withholding taxes 111,945 8,750
P1,347,941 P111,602

China Bank 197 Annual Report 2016

CHINA BANK BRANCHES

MAKATI MAIN BRANCH (HO) ARRANQUE BRANCH BEL-AIR BRANCH BO. KAPITOLYO BRANCH
CBC Bldg., 8745 Paseo de Roxas Don Felipe Building 2/F Saville Bldg., Gil Puyat Ave. G/F P&E Building, 12 United
cor. Villar Sts., Makati City 675 Tomas Mapua St. cor. Paseo de Roxas St., Makati City cor. First Sts., Bo. Kapitolyo, Pasig City
Trunkline:885-5555 Sta. Cruz, Manila Tel. Nos.: 897-2212 Tel. Nos.: 634-8370/8915/3697
(Private Exchange Connecting All Tel. Nos.: 733-3477; 734-4777 899-4186/0685 Fax No.: 634-7504
Departments) 733-7704 Fax No.: 890-4062 Ana Victorina D. Camacho
Fax Nos.: 892-0220; 817-1325 733-8335 to 40 Glenn R. Narvaez
Marissa A. Auditor 734-4497; 734-4501/06 BONNY SERRANO BRANCH
Fax No.: 733-3481 BETTER LIVING SUBD. BRANCH G/F Greenhills Garden Square
BINONDO BUSINESS CENTER Flora C. Peña 128 Doña Soledad Ave. 297 Col. Bonny Serrano Ave.
CBC Bldg., Dasmariñas Parañaque City Quezon City
cor. Juan Luna Sts., Binondo, Manila ASUNCION BRANCH Tel. Nos.: 556-3467; 556-3468 Tel. Nos.: 410-0677; 997-8043
Trunklines: 247-5388; 885-5222 Units G6 & G7 Chinatown Steel 556-3470 997-8031
(Private Exchange Connecting All Towers, Asuncion St. Fax No.: 556-3470 Fax No.: 410-0677
Departments) San Nicolas, Manila Flormina B. Jacinto Marvi B. Repuya
Fax Nos.: 241-7058; 242-7225 Tel. Nos.: 241-2311/52/59/61
Shirley T. Tan Fax No.: 241-2352 BF HOMES BRANCH CAINTA BRANCH
Mary Ann E. Tiu Aguirre cor. El Grande Aves. CBC Bldg., (Beside Sta. Lucia East Mall)
United BF Homes, Parañaque City Felix Ave. (Imelda Ave.) Cainta, Rizal
METRO MANILA AYALA-ALABANG BRANCH Tel. Nos.: 825-6138/6891/6828 Tel. Nos.: 646-0691/93; 645-9974
G/F, CBC-Building, Acacia Ave. Fax No.: 825-5979 682-1795
A. BONIFACIO-MAUBAN BRANCH Madrigal Business Park Eslanie Q. Castillo Fax Nos.: 646-0050; 4777383
G/F Urban Oasis Residences Ayala Alabang, Muntinlupa City Donna G. Del Rosario
423-431., A. Bonifacio Ave. Tel. Nos.: 807-0673-74 BF HOMES-AGUIRRE BRANCH
Brgy. San Jose, Quezon City 850-3785/9640/8888 Margarita Centre, Aguirre Ave. CAPITOL HILLS BRANCH
Tel. Nos.: 282-1991/94 Fax No.: 850-8670 cor. Elsie Gaches St. G/F 88 Design Pro Building Capitol
Fax No.: 282-1994 Victoria G. Capacio BF Homes, Parañaque City Hills, Old Balara, Quezon City
Vivian T. Kho Tel. Nos.: 799-4707/4942 Tel. Nos.: 952-7776/7805/7804
AYALA-COLUMNS BRANCH 659-3359/3360 Fax No.: 952-7806
ALABANG HILLS BRANCH G/F The Columns Tower 3 556-5845 Joanna Leigh R. Gojar
G/F RBC-MDC Corporate Center Ayala Ave., Makati City Fax No.: 659-3359
Don Jesus Blvd., Alabang Hills Village Tel. Nos.: 915-3672/3673 Maria Adelfa E. Bolivar CENTURY CITY-KNIGHTSBRIDGE
Muntinlupa City 915-3674/3675 BRANCH
Tel. Nos.: 877-8567; 877-8604 Fax No.: 915-3672 BF RESORT VILLAGE BRANCH Unit 17 & 18 Knightsbridge
Fax No.: 877-8604 Cherryl S. Sambito BF Resort Drive cor. Gloria Diaz St. Residences, Century City
Carlo D. Catindig BF Resort Village, Talon Dos Kalayaan Ave., Makati City
BALINTAWAK-BONIFACIO BRANCH Las Piñas City Tel. Nos.: 866-3937; 866-3803
ANTIPOLO CITY BRANCH 657 A. Bonifacio Ave. Tel. Nos.: 873-4542, 873-4541 Fax No.: 866-3937
G/F Budget Lane Arcade Balintawak, Quezon City 873-4540 Sherry Grace P. Bernabe
No. 6, Provincial Road Tel. Nos.: 361-3449; 361-7825 Fax No.: 873-4543
Brgy. San Jose, Antipolo City, Rizal 362-3660; 361-0450 Heizel P. Bautista COMMONWEALTH AVENUE
Tel. Nos.: 650-3277; 650-2087 Fax No.: 361-0199 BRANCH
695-1509 Vivian T. Kho BGC-ICON PLAZA BRANCH LGF Ever Gotesco Mall
Fax No.: 650-2640 G/F Icon Plaza Bldg., 25th Sts. Bonifacio Commonwealth Center
Judy Kristine N. Achacoso BALUT BRANCH South, Fort Bonifacio Global City Commonwealth Ave.
North Bay Shopping Center Taguig City cor. Don Antonio Road, Quezon City
ANTIPOLO CITY-TAKTAK BRANCH Honorio Lopez Boulevard Tel. Nos.: 777-1943; 800-1474 Tel. Nos.: 932-0818/0820
Sumulong Highway near cor. Balut, Tondo, Manila Fax No.: 777-1943 431-5000/01
Taktak Road, Brgy. Dela Paz Tel. Nos.: 253-9921/29; 253-9620 Marites M. Cadiz Fax No.: 932-0822
Antipolo City, Rizal 251-1182/86 Chinky Karen C. Caravana
Tel. Nos.: 721-6320; 721-6316 Fax No.: 253-9917 BGC-ONE WORLD PLACE BRANCH
Fax No.: 721-6316 Sonny T. Badua G/F One World Place, 32nd Ave. CONGRESSIONAL AVENUE BRANCH
Mary Glenn B. Sanguyo Fort Bonifacio Global City, Taguig City G/F Unit C The Arete Square
BANAWE BRANCH Tel. Nos.: 869-6309; 843-2448 Congressional Ave., Project 8
ANTIPOLO-SUMULONG HIGHWAY CBC Bldg., 680 Banawe Ave. Fax No.: 843-2448 Quezon City
BRANCH Sta. Mesa Hts. District I, Quezon City Minerva A. Briones Tel. Nos.: 351-8648; 351-8645
No. 219 Sumulong Highway Tel. Nos.: 743-7486/88 351-8646
Brgy. Mambugan, Antipolo City, Rizal 416-7028/7030/711-8694 BINANGONAN BRANCH Fax No.: 351-8645
Tel. Nos.: 632-7309; 632-7573 Fax No.: 743-7487 National Highway, Bo. Tagpos Joni Jane A. Ong
655-8087 Rodolfo S. De Lara Binangonan, Rizal
Fax No.: 632-7309 Tel. Nos.: 669-1530; 669-1659 CORINTHIAN HILLS BRANCH
Irene S. Lopez BANAWE-MA. CLARA BRANCH Fax No.: 669-1530 G/F The Clubhouse, Corinthian Hills
G/F Prosperity Bldg., Banawe St. Jennifer W. Guevarra Temple Drive, Brgy. Ugong Norte
ARANETA AVE. BRANCH Quezon City Quezon City
Philippine Whithasco Bldg. Tel. Nos.: 732-1060; 740-4864 BLUMENTRITT BRANCH Tel. Nos.: 637-3170/3180/1915
420 Araneta Ave., cor. Bayani St. 743-8967 1777-1781 Cavite cor. Leonor Fax No.: 637-1905
Quezon City Fax No.: 740-4864 Rivera St., Blumentritt, Sta. Cruz Ma. Anacleta B. Gloria
Tel. Nos.: 731-2252; 731-2261 Raidis M. De Guzman Manila
732-4153; 731-2179 Tel. Nos.: 742-0254;711-8589
731-2216; 410-6753 Fax No.: 711-8541
Fax No.: 410-3026 Jennet P. Jose
Arlene T. Uy

China Bank 198 Annual Report 2016

CHINA BANK BRANCHES

CUBAO-ARANETA BRANCH DEL MONTE AVENUE BRANCH EDSA-TIMOG AVE. BRANCH FILINVEST CORPORATE CITY
Shopwise Arcade Building No. 497 Del Monte Ave. G/F Richwell Corporate Center BRANCH
Times Square St., Araneta Shopping Bgry. Manresa, Quezon City 102 Timog Ave., Brgy. Sacred Heart G/F Wilcon Depot, Alabang-Zapote
Center, Cubao, Quezon City Tel. Nos.: 413-2826; 413-2825 Quezon City road cor. Bridgeway Ave., Filinvest
Tel. Nos.: 911-2369/70 961-8828; 871-2745 Tel. Nos.: 441-5225, 441-5226 Corporate City, Alabang, Muntinlupa
438-3830-32; 911-2397 Fax No.: 361-1101 441-5227 Tel. Nos.: 775-0097/0126
Fax No.: 911-2432 Wendy C. Tan Fax No.: 441-5228 842-1993/2198
Arnulfo C. Tongson Antonio J. Tan, Jr. 807-2657 (area Office)
DEL MONTE-MATUTUM BRANCH Fax No.: 775-0322
CUBAO-AURORA BRANCH No. 202 Del Monte Ave. ELCANO BRANCH Mary Grace D.P. Macaraig
911 Aurora Boulevard Extension near cor. Matutum St. G/F Elcano Tower, Elcano St.
cor. Miami St., Cubao, Quezon City Brgy. St. Peter, Quezon City San Nicolas, Manila FILINVEST CORP. CITY-
Tel. Nos.: 912-5164/57 Tel. Nos.: 731-2535; 731-2571 Tel. Nos.: 244-6760; 244-6765 COMMERCENTER BRANCH
913-4675/76; 911-3524 413-2118; 416-7791 244-6779 G/F Commercenter Alabang
Fax No.: 912-5167 Fax No.: 416-7791 Fax No.: 244-6760 Commerce Ave. cor. Filinvest Ave.
Ramiro Mateo D. Valdivia Stella A. Lim Gervie Roy S. Mendoza Filinvest Corporate City, Alabang
Muntinlupa City
CUBAO-P. TUAZON BRANCH E. RODRIGUEZ-ACROPOLIS ERMITA BRANCH Tel. Nos.: 805-0824; 805-0827
No. 287 P. Tuazon Ave. BRANCH Ground Floor A, Ma. Natividad Bldg. Fax No.: 805-0146
near cor. 18th Ave., Brgy. San Roque G/F Suncrest Building #470 T. M. Kalaw cor. Cortada Sts. Ma. Clara R. Buan
Cubao, Quezon City E. Rodriguez Jr. Ave., Quezon City Ermita, Manila
Tel. Nos.: 911-5896; 911-8416 Tel. Nos.: 654-3607; 654-3586 Tel. Nos.: 525-6477;;536-7794 FILINVEST CORP. CITY-NORTHGATE
Fax No.: 911-8416 Fax No.: 654-3586 525-6544;523-0074 BRANCH
Andrea L. Taylan Richard Donelle O. Pareja 523-9862 G/F Aeon Centre Building, Northgate
Fax No.: 525-8137 Cyberzone, Filinvest Corporate City
CULIAT-TANDANG SORA BRANCH E. RODRIGUEZ-CORDILLERA BRANCH Redentor E. Raymundo Alabang, Muntinlupa City
G/F Royal Midway Plaza No. 291 (G/F Units 285 & 287) Tel. Nos.: 776-1985; 551-5569
No. 419, Tandang Sora Ave. E. Rodriguez Sr. Blvd. ESPAÑA BRANCH Fax No.: 776-1985
Brgy. Culiat, 1128 Quezon City Brgy. Doña Josefa, Quezon City España cor. Valencia Sts. Ma. Concepcion P. Masangkay
Tel. Nos.: 288-2575; 288-5114 Tel. Nos.: 257-1512; 256-5292 Sampaloc, Manila
Fax No.: 288-2575 Fax No.: 257-1512 Tel. Nos.: 741-9572/6209 FIVE E-COM CENTER BRANCH
Eileen M. Felipe Maria Virginia D. Longakit 741-6208/9565 G/F Five E-com Center, Harbor Drive
Fax No.: 741-6207 MOA Complex, Pasay City
D. TUAZON BRANCH E. RODRIGUEZ-HILLCREST BRANCH Jose Omar S. Yuan Tel. Nos.: 815-1883; 815-1884
148 D. Tuazon St., Brgy. Lourdes No. 402 E. Rodriguez Sr. Blvd. 815-1887
Sta. Mesa Heights, Quezon City Cubao, Quezon City EXAMINER BRANCH Fax No.: 815-1883
Tel. Nos.: 731-2516/2508 Tel. Nos.: 571-8927; 571-8928 No. 1525 Quezon Ave. Donny M. Dela Cruz
Fax No.: 731-0592 571-8929 cor. Examiner St., West Triangle
Ella Jane D. Cortez Fax No.: 571-8927 Quezon City FORT BONIFACIO GLOBAL CITY
Rachel D. Umali Tel. Nos.: 376-3313/3314 BRANCH
DAMAR VILLAGE BRANCH 376-3317/3318 G/F Marajo Tower, 26th St.
Clubhouse, Damar Village E. RODRIGUEZ SR. BLVD. BRANCH Fax No.: 376-3315 cor. 4th Ave., Fort Bonifacio
Quezon City CBC Bldg., #286 E. Rodriguez Sr. Blvd. Crislyn R. David Global City, Taguig City
Tel. Nos.: 442-3581; 367-5517 Brgy. Damayang Lagi, Quezon City Tel. Nos.: 799-9072/9074
Fax No.: 367-5517 Tel. Nos.: 416-3166; 722-5860 EVANGELISTA BRANCH 856-4416/4891/5196
Tennessy U. Yu Seng 722-5893; Evangelista cor. Gen. Estrella Sts. 403-1558 (MCB)
725-9641 (MCB) Bangkal, Makati City Fax No.: 856-4416
DASMARIÑAS VILLAGE BRANCH Fax No.: 726-2865 Tel. Nos.: 759-5095; 759-5096 Shellane S. Salgatar
2283 Pasong Tamo Ext. Ana Ma. Raquel Y. Samala 856-0434; 856-0433
cor. Lumbang St., Makati City Fax No.: 759-5096 GEN. LUIS-KATIPUNAN BRANCH
Tel. Nos.: 894-2392/93; 813-2958 EASTWOOD CITY BRANCH Sheijan A. Baladji CBC Bldg., Gen. Luis St. cor.
Fax No.: 894-2355 Unit D, Techno Plaza One, Eastwood Katipunan SB Road, Brgy. Bagong
Ruth D. Holmes City Cyberpark, E. Rodriguez Jr. Ave. FAIRVIEW BRANCH Nayon, Novaliches, Quezon City
(C-5) Bagumbayan, Quezon City G/F Angelenix House, Fairview Ave. Tel. Nos.: 285-5664; 285-5665
DIVISORIA-STA. ELENA BRANCH Tel. Nos.: 706-3491/3493/1979 cor. Camaro St., Quezon City Fax No.: 285-5665
New Divisoria Condominium Center 706-3320/3448 Tel. Nos.: 937-5597; 938-9636 Myra A. De Guzman
632 Sta. Elena St., Binondo, Manila Fax No.: 438-5531 937-8086; 461-3004
Tel. Nos.: 247-1435/36/37 Ramiro A. Amanquiton Fax No.: 937-8086 GIL PUYAT AVENUE BRANCH
Fax No.: 247-1436 April Jean P. Chiong Mitsu Bldg., No. 65 Sen. Gil Puyat Ave.
Mary Elizabeth Uy EDSA-KALOOKAN BRANCH Brgy. Palanan, Makati City
No. 531 (Lot 5 Block 30) EDSA FAIRVIEW TERRACES BRANCH Tel. Nos.: 844-0492/94
DON ANTONIO BRANCH near cor. Biglang Awa St. LGF Fairview Terraces, Quirino 844-0688/90
G/F Royale Place, Don Antonio Ave. Kalookan City Highway cor. Maligaya Drive Fax No.: 844-0497
Brgy. Old Balara, Quezon City Tel. Nos.: 442-4338; 442-4339 Brgy. Pasong Putik, Novaliches Juvy P. Caguiat
Tel. Nos.: 932-9477 442-4340 Quezon City
952-9678/9354 Fax No.: 442-4339 Tel. Nos.: 285-5956; 285-6058
Fax No.: 952-9344 Dolores L. Chua Tan Guat Fax No.: 285-5956
Lilibeth M. David Anthony V. Vergel De Dios

China Bank 199 Annual Report 2016

CHINA BANK BRANCHES

GIL PUYAT-ELIZABETH PLACE INTRAMUROS BRANCH KAMIAS BRANCH LEGASPI VILLAGE-AIM BRANCH
BRANCH No. 409 A. Soriano Ave. G/F CRM Building II, 116 Kamias Road G/F Cacho-Gonzales Building
G/F Elizabeth Place, Gil Puyat Ave. Intramuros, Manila cor. Kasing-Kasing St., Quezon City 101 Aguirre cor. Trasierra Sts.
Makati City Tel. Nos.: 528-4241; 536-1044 Tel. Nos.: 433-6007; 920-7367 Legaspi Village, Makati City
Tel. Nos.: 776-0502; 776-3234 536-5971; 310-5122 920-8770 Tel. Nos.: 818-8156; 818-0734
Fax No.: 766-0502 Fax No.: 536-1044 Fax No.: 920-5723 818-9649
Ma. Rosalie F. Cipriano Shirley L. Coquinco Mary Ann P. Arroyo 894-5882 to 85
Fax No.: 818-0240
GREENBELT 1 BRANCH J. ABAD SANTOS AVENUE BRANCH KAMUNING BRANCH Ma. Luisa C. Rivera
G/F Greenbelt 1, Legaspi St. 2159 J. Abad Santos Ave. #47 SKY47 Bldg., Kamuning Road
near cor. Paseo de Roxas, Makati City cor. Batangas St., Tondo, Manila Quezon City LEGASPI VILLAGE-C. PALANCA
Tel. Nos.: 836-1387; 836-1405 Tel. Nos.: 255-1201 to 02 Tel. Nos.: 287-3369; 287-3368 BRANCH
836-1406 255-1204 Fax No.: 287-3369 Suite A, Basic Petroleum Building
Fax No.: 836-1406 Fax No.: 255-1203 Manuel S. Aurora, Jr. 104 C. Palanca Jr. St.
Lorena M. Calpito Josephine D. Paredes Legaspi Village, Makati City
KARUHATAN BRANCH Tel. Nos.: 894-5915/18; 810-1464
GREENHILLS BRANCH JUAN LUNA BRANCH No. 248 McArthur Highway Fax No.: 894-5868
G/F Gift Gate Bldg., Greenhills G/F Aclem Building, 501 Juan Luna St. Karuhatan, Valenzuela City Ma. Rosalie F. Cipriano
Shopping Center, San Juan Binondo, Manila Tel. Nos.: 291-0431/0175
Metro Manila Tel. Nos.: 247-3570/3795/3786 440-0033 LEGASPI VILLAGE-ESTEBAN
Tel. Nos.: 721-0543/56; 721-3189 480-0211 Fax No.: 440-0033 BRANCH
727-9520; 724-5078 Fax No.: 247-3795 Rosa C. Arteche G/F PPI Bldg., No. 109 Esteban St.
724-6173; 727-2798 Mary Ann K. Abrigo Legaspi Village, Makati City
Fax No.: 726-7661 KATIPUNAN AVE.-ST. IGNATIUS Tel. Nos.: 800-6147; 805-4820
Cherrie Germaine T. Bautista KALAYAAN AVE. BRANCH BRANCH Fax No.: 805-4820
G/F PPS Building, Kalayaan Ave. CBC Bldg., No. 121 Katipunan Ave. Stephanie Nikki B. Nanquil
GREENHILLS-CONNECTICUT Quezon City Brgy. St. Ignatius, Quezon City
BRANCH Tel. Nos.: 332-3858; 332-3859 Tel. Nos.: 913-5532; 912-5003 LEGASPI VILLAGE-PEREA BRANCH
G/F Missouri Square Bldg. 332-3860 913-3226 G/F Greenbelt Mansion, 106 Perea St.
Missouri cor. Connecticut St. Fax No.: 332-3859 Fax No.: 913-5532 Legaspi Village, Makati City
Northeast Greenhills, San Juan City Bing D. Cueno Warlito R. Estrella Tel. Nos.: 893-2273/2272/2827
Tel. Nos.: 997-3452; 997-3455 Fax No.: 893-2272
Fax No.: 997-3452 KALOOKAN BRANCH LAGRO BRANCH Noemi C. Mendoza
Prince Edward Solomon CBC Bldg., 167 Rizal Ave. Extension CBC Bldg., Lot 32 Blk 125, Quirino
Grace Park, Kalookan City Highway, Greater Lagro, Quezon City LEGASPI VILLAGE-SALCEDO
GREENHILLS-ORTIGAS BRANCH Tel. Nos.: 364-0515/35 Tel. Nos.: 372-8226; 372-8223 BRANCH
CBC Bldg., 14 Ortigas Ave. 364-0717/31; 364-0494 Fax No.: 372-8223 G/F Fedman Suites
Greenhills, San Juan, Metro Manila 364-9948; 366-9457 Lilibeth M. David 199 Salcedo St., Legaspi Village
Tel. Nos.: 723-0530/01 Fax No.: 364-9864 Makati City
723-0502/04; 726-1492 Danilo T. Sarita LAS PIÑAS BRANCH Tel. Nos.: 893-7680; 893-2618
727-4163 (Area Head) CBC Bldg., Alabang-Zapote Road 759-2462; 893-1503
Fax No.: 723-0556; 725-9025 KALOOKAN-8th AVE. BRANCH cor. Aries St., Pamplona Park Subd. 816-0905
Jose Redentor V. Trinidad No. 279 Rizal Ave. cor. 8th Ave. Las Piñas City Fax No.: 893-3746
Grace Park, Kalookan City Tel. Nos.: 874-6204; 874-6210 Manuel O. Yap
HEROES HILLS BRANCH Tel. Nos.: 287-0001; 287-0262 Fax No.: 874-6414
Quezon Ave. cor. J. Abad Santos St. Fax No.: 287-0262 Myra D. Adriano MAGALLANES VILLAGE BRANCH
Heroes Hills, Quezon City Catherine Ann H. Chua-Baylon G/F DHI Bldg., No. 2 Lapu-Lapu Ave.
Tel. Nos.: 351-4359/5121 LAS PIÑAS-MANUELA BRANCH cor. EDSA, Magallanes Village
411-3375; 412-5697 KALOOKAN-10th AVE. BRANCH Alabang-Zapote Road cor. Philamlife Makati City
Fax No.: 351-5121 No. 275 10th Ave. cor. 3rd St. Ave., Pamplona Dos, Las Piñas City Tel. Nos.: 757-0272/0240
Mirasol C. Ruiz Grace Park, Kalookan City Tel. Nos.: 872-9801/9572/9533 852-1290; 852-1245
Tel. Nos.: 287-5484; 2875489 871-0770 Fax No.: 852-1245
HOLY SPIRIT DRIVE BRANCH Josephine D. Paredes Fax No.: 871-0771 Ma. Monica M. Ela
CBC Bldg., Lot 18 Block 6 Holy Spirit Jocylyn B. Jaca
Drive, Don Antonio Heights KALOOKAN-CAMARIN BRANCH MAKATI AVENUE BRANCH
Brgy. Holy Spirit, Quezon City Annex Bldg. Space No. 3, Zabarte LAVEZARES BRANCH G/F CBC Bldg., Makati Ave.
Tel. No.: 355-8665 Town Center, No. 588 Camarin Road No. 412 Lavezares St. cor. Hercules St., Makati City
Fax No.: 355-8665 cor. Zabarte Road, Kalookan City San Nicolas, Manila Tel. Nos.: 890-6971 to 74
Edward Joseph C. Alava Tel. Nos.: 442-6830; 442-7541 Tel. Nos.: 521-6978; 521-7132 Fax No.: 890-6975
Fax No.: 442-6825 521-7128 Ma. Emma Lourdes A. Libas
ILAYA BRANCH Alicia S. Gavino Fax No.: 521-6978
#947 APL-YSL Bldg., Ilaya Norma C. Yanga MAKATI-COMEMBO BRANCH
Tondo, Manila KALOOKAN-MONUMENTO No. 46 J.P. Rizal Ext.
Tel. Nos.: 245-2416; 245-2548 BRANCH LEGASPI VILLAGE-AMORSOLO Brgy. Comembo, Makati City
245-2557 779 McArthur Highway BRANCH Tel. Nos.: 802-2616; 802-2614
Fax No.: 245-2545 Kalookan City G/F CAP Bldg., Herrera cor. Amorsolo 802-2613
Jefferson G. Ching Tel. Nos.: 364-2571; 361-3270 Sts., Legaspi Village, Makati City Fax No.: 802-2613
921-3043 Tel. Nos.: 832-6871; 833-5668 Zandro A. Prieto
Fax No.: 361-3270 Fax No.: 833-5668
Maria Teresa A. Del Rosario David L. Flores

China Bank 200 Annual Report 2016

CHINA BANK BRANCHES

MAKATI-JP RIZAL BRANCH MARIKINA-STA. ELENA BRANCH N. DOMINGO BRANCH OROQUIETA BRANCH
J.P. Rizal cor. Honradez Sts. 250 J.P. Rizal St., Sta. Elena G/F The Main Place, No. 1 1225-1227, Oroquieta St.
Makati City Marikina City Pinaglabanan cor. N. Domingo Sts. Sta. Cruz, Manila
Tel. Nos.: 815-6036 to 38 Tel. Nos.: 646-4281; 646-4277 San Juan City Tel. Nos.: 521-6648; 521-6650
Fax No.: 815-6038 646-4279; 646-1807 Tel. Nos.: 470-2915; 470-2916 Fax No.: 521-6648
Maria Cecilia D. Villas Fax No.: 646-1807 470-2917 Josie T. Chua
Rosa Linda R. Yuseco Fax No.: 470-2916
MALABON-CONCEPCION BRANCH Marissa L. Manzano ORTIGAS-ADB AVE. BRANCH
Gen. Luna cor. Paez Sts. MARIKINA-FAIRLANE BRANCH LGF City & Land Mega Plaza
Concepcion, Malabon G/F E & L Patricio Building NAVOTAS BRANCH ADB Ave. cor. Garnet Rd.
Tel. Nos.: 281-0102/03/04/05 No. 809 J.P. Rizal Ave. No. 500 M. Naval St. Ortigas Center, Pasig City
281-0293 Concepcion Uno, Marikina City near cor. Lacson St., Brgy. North Bay Tel. Nos.: 687-2457/58
Fax No.: 281-0106 Tel. Nos.: 997-0684; 997-0897 Boulevard North (NBBN), Navotas City 687-2226/3263
Ma. Elenita M. Baradi 998-1817 Tel. Nos.: 283-0752 to 54 Fax No.: 687-2457
948-6120 (MCB) Fax No.: 283-0752 Jossef Dennis Z. Timbol
MALABON-GOV. PASCUAL BRANCH Fax No.: 997-0897 Ma. Elenita M. Baradi
CBC Bldg., Gov. Pascual Ave. Hector Fernando Z. Yumul ORTIGAS AVE. EXT.-RIVERSIDE
Malabon City NOVALICHES BRANCH BRANCH
Tel. Nos.: 352-1816;352-1817 MARIKINA-GIL FERNANDO 954 Quirino Highway, Novaliches Unit 2-3 Riverside Arcade
352-1822; 961-2147 BRANCH Proper, Novaliches, Quezon City Ortigas Ave. Extension
Fax No.: 352-1822 Block 9, Lot 14 Gil Fernando Ave. Tel. Nos.: 936-3512 cor. Riverside Drive, Brgy. Sta. Lucia
Amy A. Go Marikina City 937-1133/35/36 Pasig City
Tel. Nos.: 646-0780; 646-8032 Fax No.: 936-1037 Tel. Nos.: 748-18-08; 748-4426
MALABON-POTRERO BRANCH 358-2138 Edwin T. Tamayo 655-7403; 655-8350
CBC Bldg., McArthur Highway Fax No.: 646-8032 Fax No.: 655-8350
Potrero, Malabon Imelda F. Polenday NOVALICHES-SANGANDAAN Tita C. Ibarbia
Tel. Nos.: 448-0524/25 BRANCH
361-8671/7056 MARIKINA-SSS VILLAGE BRANCH CBC Bldg., Quirino Highway cor. ORTIGAS CENTER BRANCH
Fax No.: 448-0525 Lilac cor. Rainbow Sts., SSS Village Tandang Sora Ave., Brgy. Sangandaan Unit 101 Parc Chateau Condominium
Leslie Y. De Los Angeles Concepcion Dos, Marikina City Novaliches, Quezon City Onyx cor. Sapphire Sts.
Tel. Nos.: 948-5135; 941-7709 Tel. Nos.: 935-3049; 935-3491 Ortigas Center, Pasig City
MALANDAY BRANCH 997-3343 Fax No.: 935-2130 Tel. Nos.: 633-7960/70/53/54
CBC Bldg., McArthur Highway Fax No.: 942-0048 Ronaldo T. Uy, Jr. 634-0178
Malanday, Valenzuela City Nerissa J. Ramos Fax No.: 633-7971
Tel. Nos.: 432-9787; 292-6956/57 NOVALICHES-TALIPAPA BRANCH Virginia G. Go
445-3201; 432-9785 MASANGKAY BRANCH 528 Copengco Bldg.
Fax No.: 292-6956 959-961 G. Masangkay St. Quirino Highway, Talipapa ORTIGAS COMPLEX BRANCH
Miguela Gladiola G. Santos Binondo, Manila Novaliches, Quezon City G/F Padilla Building, F. Ortigas Jr. Road
Tel. Nos.: 244-1828/35/48/56/59 Tel. Nos.: 936-2202; 936-3311 (formerly Emerald Ave.)
MANDALUYONG-BONI AVE. Fax No.: 244-1833 936-7765 Ortigas Center, Pasig City
BRANCH Yan Yan Y. Chua Fax No.: 936-2202 Tel. Nos.: 634-3469; 631-2772
G/F VOS Bldg., Boni Ave. Sheryl Grace A. Abratique Fax No.: 633-9039
cor. San Rafael St., Mandaluyong City MASANGKAY-LUZON BRANCH Christabel Ethel C. Gabriana
Tel. Nos.: 746-6283/85; 534-2289 1192 G. Masangkay St. NOVALICHES-ZABARTE
Fax No.: 534-1968 Sta. Cruz, Manila G/F C.I. Bldg., 1151 Quirino Highway ORTIGAS-JADE DRIVE BRANCH
Jose Marie N. Laforteza Tel. Nos.: 255-0739; 254-9974 cor. Zabarte Road, Brgy. Kaligayahan Unit G-03, Antel Global Corporate
254-9335 Novaliches, Quezon City Center, Jade Drive, Ortigas Center
MANDALUYONG-D. GUEVARA Fax No.: 254-9974 Tel. Nos.: 461-7691; 461-7694 Pasig
BRANCH Gina C. Chua 461-7698 Tel. Nos.: 638-4489; 638-4490
G/F 19 Libertad Plaza, Domingo Fax No.: 461-7691 638-4510; 638-4540
Guevara St., Mandaluyong City MAYON BRANCH Jacqueline T. Alvariño Fax No.: 638-4540
Tel. Nos.: 534-5528; 534-5529 480 Mayon St., Maharlika Grace N. Soriano
Fax No.: 534-5529 Sta. Mesa Heights, Quezon City NUEVA BRANCH
Ma. Farida Sangalang Tel. Nos.: 731-9054/2766 Unit Nos. 557 & 559 PACO BRANCH
741-2409 G/F Ayson Building, Yuchengco St. Gen. Luna cor. Escoda St.
MANDALUYONG-PIONEER BRANCH Fax No.: 731-2766 Binondo, Manila Paco, Manila
UG-05 Globe Telecom Plaza Tower I Stella A. Lim Tel. Nos.: 247-6374; 247-6396 Tel. Nos.: 526-6492
Pioneer St., Mandaluyong City 247-0493; 480-00-66 536-6630/31/72
Tel. Nos.: 746-6949 MINDANAO AVE. BRANCH Fax No.: 247-6396 Fax No.: 536-6657
635-4198; 632-1399 G/F LJC Building, 189 Mindanao Ave. Melissa S. Uy Susan V. Co
Fax No.: 746-6948 Bahay Toro, Quezon City
Marie Jane V. Malig Tel. Nos.: 277-4768; 277-4782 ONGPIN BRANCH PACO-ANGEL LINAO BRANCH
Fax No.: 277-4768 G/F Se Jo Tong Building Unit 1636 & 1638 Angel Linao St.
MANILA-MACEDA BRANCH Ma. Cecilia D. So 808 Ongpin St., Sta. Cruz, Manila Paco, Manila
Daguman Bldg., Maceda St. Tel. Nos.: 733-8962 to 66 Tel. Nos.: 242-2849; 242-3416
Sampaloc, Manila MUNTINLUPA-PUTATAN BRANCH 735-5362 Fax No.: 242-2849
Tel. Nos.: 521-6644; 521-6643 G/F Teknikos Bldg., National Highway Fax No.: 733-8964 Anna Lissette Y. Rogato
Fax No.: 521-6644 Brgy. Putatan, Muntinlupa City Dolly C. Diu
Joel E. Torio Tel. Nos.: 511-0980; 808-1817
Fax No.: 808-1819
Carina A. Cariño

China Bank 201 Annual Report 2016

CHINA BANK BRANCHES

PACO-OTIS BRANCH PASIG-MERCEDES BRANCH PHILAM BRANCH SALCEDO VILLAGE-L.P. LEVISTE

G/F Union Motor Corp. Bldg. Commercial Motors Corp. Compound #8 East Lawin Drive BRANCH
1760 Dra. Paz Guazon St. Mercedes Ave., Pasig City Philam Homes, Quezon City Unit 1-B G/F The Athenaeum
Paco, Manila Tel. Nos.: 628-0197/0209/0201 Tel. Nos.: 927-9841; 924-2872 San Agustin – LP Leviste St.
Tel. Nos.: 561-6902; 561-6981 Fax No.: 628-0211 929-5734 Salcedo Village, Makati City
564-2247 Rosanna H. Malavega Fax No.: 929-3115 Tel. Nos.: 869-3128; 869-3132
Fax No.: 561-6981 April Jean P. Chiong 869-3134
Ma. Victoria O. Rondilla PASIG-SAN JOAQUIN BRANCH Fax No.: 869-3132
No. 43 M. Concepcion Ave. PROJECT 8-SHORTHORN BRANCH Madelene D. Capangpangan
PADRE FAURA BRANCH San Joaquin, Pasig City Shorthorn St., Project 8, Quezon City
G/F Regal Shopping Center, A. Mabini Tel. Nos.: 997-2815; 997-2816 Tel. Nos.: 373-3363; 373-3369 SALCEDO VILLAGE-TORDESILLAS
cor. P. Faura Sts., Ermita, Manila 997-2817 Fax No.: 373-3363 BRANCH
Tel. Nos.: 526-0586; 527-3202 Fax No.: 997-2815 Ma. Cecilia D. So G/F Prince Tower Condominium
527-7865 Ma. Jeanie V. Endonela 14 Tordesillas St., Salcedo Village
Fax No.: 527-3202 QUEZON AVE. BRANCH Makati City
Carmina P. Manimbo PASIG-SANTOLAN BRANCH No. 18 G & D Bldg., Quezon Ave. Tel. Nos.: 813-4901/32/33
G/F Felmarc Business Center cor. D. Tuazon St., Quezon City 813-4944/52
PARAÑAQUE-MOONWALK Amang Rodriguez Ave. Tel. Nos.: 712-3676; 712-0424 Fax No.: 813-4933
BRANCH Santolan, Pasig City 740-7779/80; 712-1105 Pamela Joyce E. Gonzalez
Milky Way St. cor. Armstrong Ave. Tel. Nos.: 646-0635; 682-3474 416-8891
Moonwalk, Parañaque City 682-3514; 681-4575 732-2137 (MCB) SALCEDO VILLAGE-VALERO
Tel. Nos.: 846-9729; 846-9739 Fax No.: 646-0514 Fax No.: 712-3006 BRANCH
846-9771 Joanaru B. Macalagay Anita Y. Samala G/F Valero Tower, 122 Valero St.
Fax No.: 846-9739 Salcedo Village, Makati City
Rica Judith S. Garcia PASIG-SM SUPERCENTER BRANCH QUIAPO BRANCH Tel. Nos.: 892-7768/69; 812-9207
G/F SM Supercenter Pasig 216-220 Villalobos St., Quiapo, Manila 893-8188/96
PARAÑAQUE-SUCAT BRANCH Frontera Drive, C-5, Ortigas, Pasig City Tel. Nos.: 733-2052/59/61 Fax No.: 892-7769
No. 8260 (between AMA Computer Tel. Nos.: 706-3207/3208/3209 733-6282/86 Nellie S. Alar
School and PLDT), Dr. A. Santos Ave. Fax No.: 706-3208 Fax No.: 733-6282
Brgy. San Isidro, Parañaque City Maria Norissa D. Mempin Leslie C. So SALES-RAON BRANCH
Tel. Nos.: 820-8951/52; 820-2044 611 Sales St., Quiapo, Manila
825-2501;804-3054/58 PASIG-VALLE VERDE BRANCH REGALADO AVE. BRANCH Tel. Nos.: 734-5806; 734-7427
(Area Office) G/F Reliance IT Center CBC Bldg., Regalado Ave. 734-6959
Fax No.: 825-9517 E. Rodriguez Jr. Ave. North Fairview, Quezon City Fax No.: 734-6959
Evangeline S. Peñafiel Ugong, Pasig City Tel. Nos.: 921-5678; 921-5359 Michael Christian G. Kua
Tel. Nos.: 706-9242; 706-9243 Fax No.: 921-5359
PASAY-LIBERTAD BRANCH Fax No.: 706-9243 Anthony V. Vergel De Dios SAN ANTONIO VILLAGE-P. OCAMPO
CBC Bldg., 184 Libertad St. Marcelino V. Cristobal BRANCH
Antonio Arnaiz Ave., Pasay City RIZAL-ANGONO BRANCH JM Macalino Auto Center
Tel. Nos.: 551-7159; 834-8978 PASO DE BLAS BRANCH Lot 3 Blk. 4 M.L Quezon Ave. P. Ocampo St. cor. Dungon St.
831-0306; 831-0498 G/F CYT Bldg., No. 178 Paso de Blas Richmond Subd., Angono, Rizal San Antonio Village, Makati City
Fax No.: 551-7160 Valenzuela City Tel. Nos.: 633-5198; 633-7513 Tel. Nos.: 869-5648; 869-5649
Michelle C. Ang Tel. Nos.: 292-3215/3213/3216 Jennifer W. Guevarra Evanzueda F. Tuazon
Fax No.: 444-8850
PASAY-ROXAS BLVD. BRANCH Ma. Letecia G. Milan RIZAL-SAN MATEO BRANCH SAN JUAN BRANCH
GF Unit G-01 Antel Seaview Towers #63 Gen. Luna cor. Simon St. 17 (new) F. Blumentritt St.
2626 Roxas Blvd., Pasay City PASONG TAMO BAGTIKAN Banaba, San Mateo, Rizal San Juan, Metro Manila
Tel. Nos.: 551-9067/68/69 BRANCH Tel. Nos.: 650-2230; 650-1837 Tel. Nos.: 724-8263; 726-4826
833-5048 G/F Trans-Phil House Fax No.: 650-1837 744-5616 to 18
Fax No.: 551-1768 1177 Chino Roces Ave. Cynthia S. Memoracion 723-7333;
Ronaldo H. Francisco cor. Bagtikan St., Makati City Fax No.: 723-4998
Tel. Nos.: 403-4820; 403-4821 ROOSEVELT AVE. BRANCH Jesse Carlo T. Salvador
PASIG-A. MABINI BRANCH 403-4822; 738-7591 CBC Bldg., #293 Roosevelt Ave.
A. Mabini St., Brgy. Kapasigan Fax No.: 403-4821 San Francisco Del Monte, Quezon City SAN JUAN-J. ABAD SANTOS
Pasig City Maria Lucy Hazel C. Provido Tel. Nos.: 371-5133 to 35 BRANCH
Tel. Nos.: 534-5178; 634-4028 410-2160 410-1957 Unit 3 Citiplace Bldg., 8001 Jose Abad
Fax No.: 534-5178 PASONG TAMO-CITYLAND BRANCH 371-2766 Santos St., Little Baguio, San Juan City
Jesucristina R. Dela Cruz Units UG30-UG32 Cityland Pasong Fax No.: 371-2765 Tel. Nos.: 470-8292; 656-8329
Tamo Tower, 2210 Pasong Tamo St. Eileen M. Felipe Fax No.: 656-8329
PASIG-C. RAYMUNDO BRANCH Makati City Rowena R. Mendoza
G/F MicMar Apartments No. 6353 Tel. Nos.: 817-9337/47/51/60/82 ROOSEVELT AVE.-FRISCO BRANCH
C. Raymundo Ave., Brgy. Rosario Fax No.: 817-9351 G/F Norita Bldg., #51 H. Francisco St. SHAW-HAIG BRANCH
Pasig City Marian D. Gonzales cor. Roosevelt Ave., Brgy. Paraiso G/F First of Shaw Bldg., Shaw Blvd.
Tel. Nos.: 642-3652; 628-3912 Quezon City cor. Haig St., Mandaluyong City
628-3922 PATEROS BRANCH Tel. Nos.: 709-7552; 921-0866 Tel. Nos.: 534-1073; 534-0744
Fax No.: 576- 4134 G/F Adela Bldg., M. Almeda St. Fax No.: 921-0866 718-0218
Joy L. Constantino Brgy. San Roque, Pateros Mary Jo-Ann G. Pua 621-6459
Tel. Nos.: 531-6929; 531-6810 531-0795 (MCB)
654-3079 Fax No.: 576-3841 (telefax)
Fax No.: 654-3079 Jose Roy Billones
Ma. Renalyn B. Navarro

China Bank 202 Annual Report 2016

CHINA BANK BRANCHES

SHAW-PASIG BRANCH SM CITY FAIRVIEW BRANCH SOLER-168 BRANCH TOMAS MAPUA-LAGUNA BRANCH
G/F RCC Center LGF, SM City Fairview G/F R & S Bldg., Soler St., Manila CBC Bldg., Tomas Mapua St.
No. 104 Shaw Boulevard, Pasig City Quirino Ave. cor. Regalado Ave. Tel. Nos.: 242-1041; 242-1674 Sta. Cruz, Manila
Tel. Nos.: 634-5018/19 Fairview, Quezon City 242-1685 Tel. Nos.: 495-0302; 495-0294
634-3343/44 Tel. Nos.: 417-2878; 939-3105 Fax No.: 242-1041 Fax No.: 495-0302
747-7812; 634-3340 Fax No.: 418-8228 Charles T. Salaya Jocelyn E. Tan
638-2751 (MCB) Maricris R. Reyes
Fax No.: 634-3344 SOUTH TRIANGLE BRANCH TOMAS MORATO EXTENSION
Hermenegildo G. Cariño SM MALL OF ASIA BRANCH G/F Sunshine Blvd. Plaza, Quezon Ave. BRANCH
G/F Main Mall Arcade, SM Mall of cor. Sct. Santiago and Panay Ave. G/F QY Building, Tomas Morato Ave.
SHAW-SUMMIT ONE BRANCH Asia, Bay Blvd., Pasay City Bgry. South Triangle, Quezon City Quezon City
Unit 102 Summit One Office Tower Tel. Nos.: 556-0100/0102/0099 Tel. Nos.: 277-7947; 277-7948 Tel. Nos.: 373-4960; 373-4961
530 Shaw Boulevard 625-2246 Fax No.: 277-7947 Fax No.: 373-4961
Mandaluyong City Fax No.: 556-0099 Rosela O. Wong William Cipriano D. Orcine III
Tel. Nos.: 531-3970; 531-5736 Charmaine V. Santos
531-4058; 531-1304 STA. MESA BRANCH 999 MALL BRANCH
533-8723; 533-4948 SM MEGAMALL BRANCH (formerly Mezza Residences) Unit 3D-5; 3D-7 999 Shopping Mall
Fax No.: 531-9469 LGF Building A, SM Megamall 1-B G. Araneta Ave. Bldg., 2 Recto-Soler Sts.
Lilian B. Orlina EDSA cor. J. Vargas St. Brgy. Doña Imelda, Quezon City Binondo, Manila
Mandaluyong City Tel. Nos.: 516-0764; 516-0765 Tel. Nos.: 523-1216/ 1217/ 1218
SM AURA PREMIER BRANCH Tel. Nos.: 633-1611/12 516-0766 523-1219
L/G SM Aura Premier, McKinley 633-1788/89 Fax No.: 516-0765 Fax No.: 523-1215
Parkway, Fort Bonifacio Global City 638-7213 to15 Manuel S. Aurora, Jr. Arnold S. Castillo
Taguig City Fax No.: 633-4971 or 633-1788
Tel. Nos.: 808-9727; 808-9701 Aldrin S. Parco STO. CRISTO BRANCH TUTUBAN PRIME BLOCK BRANCH
Fax No.: 808-9701 622-39 Sto. Cristo St. Rivera Shophouse, Podium Area
Jacqueline M. Manalo SM CITY MASINAG BRANCH Binondo, Manila Tutuban Center Prime Block
SM City Masinag, Marcos Highway Tel. Nos.: 242-4668/73; 242-5361 C.M. Recto Ave. cor. Rivera St.
SM CITY BICUTAN BRANCH Brgy. Mayamot, Antipolo City 241-1243; 242-5449 Manila
LGF, Bldg. B, SM City Bicutan Tel. Nos.: 655-8764; 655-9124 242-3670 Tel. Nos.: 255-1414/15
Doña Soledad Ave. cor. 655-8771 Fax No.: 242-4672; 242-4761 Fax No.: 255-5441
West Service Rd., Parañaque City Fax No.: 655-9124 Christopher C. Ty Irene C. Chan
Tel. Nos.: 821-0600/0700 Kathleen Joy R. Chupungco
777-9347 T. ALONZO BRANCH UP TECHNO HUB BRANCH
Fax No.: 821-0500 SM CITY NORTH EDSA BRANCH Abeleda Business Center UP Ayala Land Techno Hub
Kathlyn I. Abalos Cyberzone Carpark Bldg. 908 T. Alonzo cor. Espeleta Sts. Commonwealth Ave., Quezon City
SM City North Ave. cor. EDSA Sta. Cruz, Manila Tel. Nos.: 441-1331/1332/1334
SM CITY BF PARAÑAQUE BRANCH Quezon City Tel. Nos.: 733-9581/82 Fax No.: 738-4800
G/F SM City BF Parañaque Tel. Nos.: 456-6633; 454-8108/21 734-3231 to 33 Ma. Celeste C. Timbol
Dr. A. Santos Ave. cor. President’s Ave. 925-4273 Fax No.: 733-9582
Parañaque City Fax No.: 927-2234 Clifton T. Cham UP VILLAGE-MAGINHAWA BRANCH
Tel. Nos.: 825-3201; 825-2990 Nicole Durene D. Cu LTR Bldg., No. 46 Maginhawa St.
825-3095; 820-0911 TAFT AVE.-QUIRINO BRANCH UP Village, Quezon City
Fax No.: 825-1062 SM CITY NORTH EDSA-ANNEX 2178 Taft Ave. near cor. Tel. Nos.: 373-3349; 373-3354
Merceditas A. Juanico BRANCH Quirino Ave., Malate, Manila Fax No.: 373-3349
UGF New Annex Building Tel. Nos.: 521-7825; 527-3285 Maria Anacleta B. Gloria
SM CITY MARIKINA BRANCH SM City North EDSA 527-6747
G/F SM City Marikina EDSA, Quezon City Fax No.: 527-3285 V. LUNA BRANCH
Marcos Highway, Brgy. Calumpang Tel. Nos.: 441-1370/1372/1373 Jorielyn B. Nuqui G/F AGGCT Bldg., No. 32 V. Luna
Marikina City Fax No.: 441-1372 cor. Matapat Sts., Brgy. Pinyahan
Tel. Nos.: 477-1845/46/47 Rommel R. Sunga TAYTAY-SAN JUAN BRANCH Quezon City
799-6105 Velasquez St., Sitio Bangiad Tel. Nos.: 772-8992; 772-8564
Fax No.: 477-1847 SM SOUTHMALL BRANCH Brgy. San Juan, Taytay, Rizal Fax No.: 772-8564
Rodercik B. Olveda UGF SM Southmall Alabang-Zapote Tel. No.: 998-6649 Rowena C. Lagman
Road, Talon 1, Almanza, Las Piñas City Fax No.: 998-6649
SM CITY SAN LAZARO BRANCH Tel. Nos.: 806-6116/19; 806-3536 Godofredo B. Ponciano, Jr. VALENZUELA BRANCH
UGF (Units 164-166) SM City 806-3547 CBC-Bldg., Mc Arthur Highway
San Lazaro, Felix Huertas St. Fax No.: 806-3548 TIMOG AVE. BRANCH cor. V. Cordero St., Marulas
cor. A.H. Lacson Extension Virgilio V. Villarosa, Jr. G/F Prince Jun Condominium Valenzuela City
Sta. Cruz, Manila 42 Timog Ave., Quezon City Tel. Nos.: 293-8920; 293-6160
Tel. Nos.: 742-1572; 742-2330 SOLEMARE BRANCH Tel. Nos.: 371-4523/24 293-5088 to 90
493-7115 G-11 Solemare Parksuites 371-4522/06 293-8919
Fax No.: 732-7935 5A Bradco Ave., Aseana Business Park Fax No.: 371-4503 Fax No.: 293-5091
Jocelyn E. Tan Parañaque City Joyce P. Alfiler Rosa L. Chiu
Tel. Nos.: 366-3237; 366-3219
SM CITY TAYTAY BRANCH 366-3199 TRINOMA BRANCH VALENZUELA-GEN. LUIS BRANCH
Unit 147 Bldg. B, SM City Taytay Fax No.: 366-3199 Unit P002, Level P1, Triangle North of AGT Building, 425 Gen. Luis St.
Manila East Road, Brgy. Dolores Lester M. Jose Manila, North Ave. cor. EDSA Paso de Blas, Valenzuela City
Taytay, Rizal Quezon City Tel. Nos.: 443-6160/61
Tel. Nos.: 286-5844; 286-5979 Tel. Nos.: 901-5570-5573 983-3861/62
661-2276, 661-2277 Fax No.: 901-5573 Fax No.: 443-6161
Fax No.: 661-2235 Maria-Catleya C. Reyes Alicia S. Gavino
Godofredo B. Ponciano, Jr.

China Bank 203 Annual Report 2016

CHINA BANK BRANCHES

VALENZUELA-MALINTA BRANCH ANGELES-MCARTHUR HIGHWAY BATANGAS CITY BRANCH CABANATUAN-MAHARLIKA

MacArthur Highway, Brgy. Malinta BRANCH P. Burgos St., Batangas City BRANCH
Valenzuela City CBC Bldg., San Pablo St. Tel. Nos.: (043) 723-0953 CBC Bldg., Maharlika Highway
Tel. Nos.: 282-2160; 282-2160 cor. McArthur Highway 520-6118 (Mla-direct) Cabanatuan City
Fax No.: 282-2013 Angeles City, Pampanga Fax Nos.: 520-6118 (Mla-direct) Tel. Nos.: (044) 463-8586/87
Ma. Christina B. Quijano Tel. Nos.: (045) 323-5793 (043) 402-9157 463-7964; 600-3590
887-6028; 625-9362 Ruvishella S. Bicol 9402395
VISAYAS AVE. BRANCH Fax No.: (045) 887-6029 Fax No.: (044) 463-8587
CBC-Building, Visayas Ave. cor. Ma. Josefa R. Nisce BATANGAS-BAUAN BRANCH Mary Ann R. Tagle
Congressional Ave. Ext., Quezon City 62 Kapitan Ponso St., Bauan, Batangas
Tel. Nos.: 454-0189; 925-2173 ANGELES-STO. ROSARIO BRANCH Tel. Nos.: (043) 702-4481 CALAPAN CITY BRANCH
455-4334/35 Angeles Business Center Bldg. 702-5383 J.P. Rizal St., San Vicente
Fax No.: 925-2155 Teresa Ave., Nepo Mart Complex Fax No.: (043) 702-4481 Calapan City, Oriental Mindoro
Thelma S. Cabanban Angeles City, Pampanga Maricel R. Alcantara Tel. Nos.: (043) 288-8978/8508
Tel. Nos.: (045) 888-5175 441-0382
WEST AVE. BRANCH 322-9596 BATANGAS-LEMERY BRANCH Fax No.: (043) 441-0382
82 West Ave., Quezon City Fax No.: (045) 888-5175 Miranda Building, Ilustre Ave. Ruel A. Añonuevo
Tel. Nos.: 924-3131/3143 Joselito F. Datu Lemery, Batangas
6363;920-6258 Tel. Nos.: (043) 409-3467 CANDON CITY BRANCH
411-6010/6011 APALIT BRANCH 984-0206 (Manila line) CBC Bldg., National Road
928-3270; CBC Bldg., McArthur Highway Fax No.: (043) 409-3467 Poblacion, Candon City, Ilocos Sur
Fax No.: 924-6364 San Vicente, Apalit, Pampanga Enrique M. Padua Tel. Nos.: (077) 674-0574
Ma. Salome D. Garcia Tel. No.: (045) 652-1131 674-0554
Fax No.: (045) 302-9560 BATANGAS-ROSARIO BRANCH Fax No.: (077) 674-0574
XAVIERVILLE BRANCH Nancy T. Mensalvas Dr. Gualberto Ave., Brgy. Namunga Marie Hope Feliza E. Malinnag
65 Xavierville Ave. Rosario, Batangas
Loyola Heights, Quezon City BAGUIO CITY BRANCH Tel. Nos.: (043) 312-3748 CARMONA BRANCH
Tel. Nos.: 433-8696; 929-1265 G/F Juniper Bldg. 312-3776 CBC Bldg., Paseo de Carmona
927-9826 A. Bonifacio Rd., Baguio City Lorellie S. Garcia Brgy. Maduya, Carmona, Cavite
Fax No.: 929-3343 Tel. Nos.: (074) 442-9581 Tel. Nos.: (046) 430-1969/1277
Alma A. Sevilla 443-5908 BATANGAS-TANAUAN BRANCH 430-3568
443-8659 to 60 J.P. Laurel Highway 4753941 (Manila line)
PROVINCIAL BRANCHES- 442-9663 Tanauan City, Batangas Fax No.: (046) 430-1277
Fax No.: (074) 442-9663 Tel. Nos.: (043) 702-8956 Maria Victoria M. Molde
LUZON Mary Anne A. Tiwaquen 702-8957
Fax No.: (043) 702-8956 CAUAYAN CITY BRANCH
ANGELES CITY BRANCH BAGUIO CITY-ABANAO BRANCH Elvira L. Maliksi G/F Prince Christopher Bldg.
CBC Bldg., 949 Henson St. G/F Paladin Hotel, No. 136 Abanao Ext. Maharlika Highway, Cauayan City
Angeles City cor. Cariño St., Baguio City BULACAN-BALAGTAS BRANCH Isabela
Tel. Nos.: (045) 887-1549 Tel. Nos.: (074) 424-4837 MacArthur Highway, Brgy. San Juan Tel. Nos.: (078) 652-1849
323-5343 424-4838 Balagtas, Bulacan 897-1338; 652-0061
887-1550/2291 Fax No.: (074) 424-4838 Tel. Nos.: (044) 769-4376 Fax No.: (078) 652-1849
625-8660/61 Edward U. Catipon 769-0359 Mary Ann S. Gaspar
Fax No.: (045) 625-8661 Fax No.: (044) 769-4376
Luzviminda Grace M. Santos BALANGA CITY BRANCH Ma. Consolacion C. Santos CAVITE-DASMARIÑAS BRANCH
G/F Dilig Building, Don Manuel G/F CBC Bldg., Gen. E. Aguinaldo
ANGELES CITY-BALIBAGO BRANCH Banzon St., Balanga City, Bataan BULACAN-PLARIDEL BRANCH Highway, Dasmariñas, Cavite
Diamond Square, Service Road Tel. Nos.: (047) 237-9388/89 CBC Bldg., Cagayan Valley Road Tel. Nos.: (046) 416-5036/39/40
McArthur Highway cor. Charlotte St. 791-1779 Plaridel, Bulacan 584-40-83 (Manila line)
Balibago, Angeles City, Pampanga Fax No.: (047) 791-1779 Tel. Nos.: (044) 931-2332 Fax No.: (046) 416-5036
Tel. Nos.: (045) 892-5136 Arnel S. Guzman 325-0069 Arlyn G. Araña
892-5144 Fax No.: (044) 931-2293
Fax No.: (045) 892-5144 BALER BRANCH Magdalena S. Ignacio CAVITE-IMUS BRANCH
Rean S. Bernarte Provincial Road, Barrio Suklayain G/F CBC Bldg., Nueno Ave.
Baler, Aurora BULACAN-STA. MARIA BRANCH Tanzang Luma, Imus, Cavite
ANGELES CITY-MARQUEE MALL Tel. Nos.: (042) 724-0026 J.P Rizal cor. C. de Guzman St. Tel. Nos.: (046) 970-8726/64
BRANCH 703-3331 (Manila line) Poblacion, Sta. Maria, Bulacan 471-2637; 471-7094
G/F Marquee Mall Fax No.: (042) 724-0026 Tel. Nos.: (044) 288-2006 Fax No.: (046) 471-2637
Angeles City, Pampanga Edwin Q. Manuel 815-2951; 913-0334 Mario E. Sayoc II
Tel. Nos.: (045) 436-4013 Fax No.: (044) 288-2006
304-0850; 889-0975 BALIWAG BRANCH Karen S. Mendoza CAVITE-MOLINO BRANCH
Fax No.: (045) 304-0850 Km. 51, Doña Remedios Trinidad (DRT) Patio Jacinto, Molino Road
Yalda Y. Ocampo Highway, Baliwag, Bulacan CABANATUAN CITY BRANCH Molino 3, Bacoor, Cavite
Tel. Nos.: (044) 766-1066/5257 Melencio cor. Sanciangco Sts. Tel. Nos.: (046) 431-0632
673-5338 Cabanatuan City 484-6295
Fax No.: (044) 766-5257 Tel. Nos.: (044) 600-4265 Fax No.: (046) 431-0901
Janet R. De Castro 463-0935 to 36 Ryan M. Dela Peña
Fax No.: (044) 463-0936
Juanito C. Santiago

China Bank 204 Annual Report 2016

CHINA BANK BRANCHES

CAVITE-ROSARIO BRANCH ISABELA-ILAGAN BRANCH LAGUNA-CABUYAO BRANCH MASBATE BRANCH

G/F CBC Bldg., Gen. Trias Drive G/F North Star Mall, Maharlika G/F Centro Mall, Cabuyao City Espinosa Bldg., Zurbito St.
Rosario, Cavite Highway, Brgy. Alibagu, Ilagan, Isabela Laguna Masbate City, Masbate
Tel. Nos.: (046) 437-0057 to 59 Tel. Nos.: (078) 323-0179 Tel. Nos.: (049) 544-2287 Tel. Nos.: (056) 333-2363/65
Fax No.: (046) 437-0058 323-0178 544-2289 Fax No.: (056) 333-2365
Ma. Lorna A. Virata Fax No.: (078) 323-0179 Fax No.: (049) 544-2287 (telefax) Ernie C. Torrevillas
Donnabella D. Castillo Anna Regina S. Del Rosario
CAVITE-SILANG BRANCH MEYCAUAYAN BRANCH
CBC Bldg., J.P. Rizal St. ISABELA-ROXAS BRANCH LAGUNA-CALAMBA BRANCH CBC Bldg., Malhacan Road
Poblacion, Silang, Cavite National Road, Brgy. Bantug CBC Bldg., National Highway Meycauayan, Bulacan
Tel. Nos.: (046) 413-5095 Roxas, Isabela Crossing, Calamba, Laguna Tel. Nos.: (044) 815-6889
413-4826; 413-5500 Tel. Nos.: (078) 376-0422 Tel. Nos.: (049) 545-7134 to 38 815-6961; 815-6958
413-5417 376-0434 Fax No.: (049) 545-7138 Fax No.: (044) 815-6961
Fax No.: (046) 413-5095 Fax No.: (078) 642-0022 Estela A. Liamson Lorela M. Guillermo
Menaline B. Reyes Adeluiso L. Cabugos
LAGUNA-STA. CRUZ BRANCH NAGA CITY BRANCH
CLARK FREEPORT ZONE BRANCH GAPAN BRANCH A. Regidor St., Sta. Cruz, Laguna Centro-Peñafrancia St.
Unit 2 Stotsenberg Medical Center G/F Waltermart Center - Gapan Tel. Nos.: (049) 501-4977 Naga City
Bldg., N. Aquino cor. S. Osmeña and Maharlika Highway, Brgy. Bayanihan 501-4107; 501-4085 Tel. Nos.: (054) 472-1359
E. Jacinto Sts., Clark Freeport Zone Gapan, Nueva Ecija Fax No.: (049) 501-4107 472-1358; 473-7920
Angeles City, Pampanga Tel. Nos.: (044) 486-0217 Jocelyn D. Rico Fax No.: 250-8169 (Manila line)
Tel. Nos.: (045) 499-8060 486-0434; 486-0695 Glenn A. Altea, Jr.
499-8062; 499-8063 Fax No.: (044) 486-0434 LAOAG CITY BRANCH
Fax No.: (045) 499-8063 Medel C. Driz Liberato Abadilla St., Brgy. 17 NUEVA ECIJA-STA. ROSA BRANCH
Lorna O. Cruz San Francisco, Laoag City CBC Bldg., Maharlika Highway
GUAGUA BRANCH Tel. Nos.: (077) 772-1024/27 Poblacion, Sta. Rosa, Nueva Ecija
DAET BRANCH Yabut Building, Plaza Burgos 771-4688; 771-4417 Tel. Nos.: (044) 333-6215
Vinzons Ave. Guagua, Pampanga Fax No.: (077) 772-1035 940-1407
Daet, Camarines Norte Tel. Nos.: (045) 458-1043 Marcialito B. Ancheta Fax No.: (044) 333-6215
Tel. Nos.: (054) 440-0066; 440-0067 458-1045; 458-1046 Teresita P. Esteban
Fax No.: (054) 472-1358 Fax No.: (045) 458-1043 LEGAZPI CITY BRANCH
Sheila F. Dalupang Nikita D. Masbang G/F Emma Chan Bldg. OCC. MINDORO-SAN JOSE BRANCH
F. Imperial St., Legazpi City Liboro cor. Rizal St., San Jose
DAGUPAN-PEREZ BRANCH LA TRINIDAD BRANCH Tel. Nos.: (052) 480-6048; 480-6519 Occidental Mindoro
Siapno Building, Perez Boulevard G/F SJV Bulasao Building 214-3077 Tel. Nos.: (043) 491-0095
Dagupan City Km. 4, La Trinidad, Benguet Fax No.: 429-1813 (Direct-Mla line) 491-0096
Tel. Nos.: (075) 522-2562 to 64 Tel. Nos.: (074) 422-2065/2590 Katherine Y. Barra Fax No.: (043) 491-0095
Fax No.: (075) 522-8308 309-1663 Gary D. Tabora
Rommel M. Agacita Fax No.: (074) 422-2065 LUCENA CITY BRANCH
Liza L. Serrano 233 Quezon Ave., Lucena City PANGASINAN-ALAMINOS CITY
DAGUPAN-M.H. DEL PILAR BRANCH Tel. Nos.: (042) 373-2317 BRANCH
Carried Realty Bldg., No. 28 M.H. del LA UNION-AGOO BRANCH 373-3872/80/87 Marcos Ave., Brgy. Palamis
Pilar St., Dagupan City National Highway 660-7861 Alaminos City, Pangasinan
Tel. Nos.: (075) 523-5606; 522-8929 San Jose Norte, Agoo, La Union Fax No.: (042) 373-3879 Tel. Nos.: (075) 551-3859
632-0430; 632-0583 Tel. Nos.: (072) 682-0350 Rossana V. Miralles 654-0286
Fax No.: (075) 523-5606 682-0391 Fax No.: (075) 654-0296
Rommel M. Agacita Fax No.: (072) 682-0350 MABALACAT-DAU BRANCH Edwin D. Viado
Rommel M. Agacita R.D. Policarpio Bldg., McArthur
DOLORES BRANCH Highway, Dau, Mabalacat, Pampanga PANGASINAN-BAYAMBANG
CBC Bldg., McArthur Highway LA UNION-SAN FERNANDO Tel. Nos.: (045) 892-4969; 892-6040 BRANCH
Dolores, San Fernando City BRANCH Fax No.: (045) 892-6040 CBC Bldg., No. 91, Poblacion Sur
Pampanga Roger Pua Phee Building Lea L. Malinit Bayambang, Pangasinan
Tel. Nos.: (045) 963-3413 to 15 National Highway, Brgy. 3 Tel. Nos.: (075) 632-5776
860-1780/81 San Fernando, La Union MALOLOS CITY BRANCH 632-5775
Fax No.: (045) 963-1014 Tel. Nos.: (072) 607-8931/8932 G/F Graceland Mall, BSU Grounds Fax No.: (075) 632-5776
Roberto P. Basilio 607-8933/8934 McArthur Highway, Guinhawa Miguel C. Jimenez, Jr.
Fax No.: (072) 607-8934 Malolos City, Bulacan
ILOCOS NORTE-SAN NICOLAS Fenalyn G. Rimando Tel. Nos.: (044) 794-5840; 662-2013 PANGASINAN-ROSALES BRANCH
BRANCH Fax No.: (044) 794-5840 CBC Bldg., Calle Dewey
National Highway, Brgy. 2 San Baltazar LAGUNA-BIÑAN BRANCH Rosemarie F. Bulaong Rosales, Pangasinan
San Nicolas, Ilocos Norte G/F Raja Cordelle Bldg. Tel. Nos.: (075) 633-3852
Tel. Nos.: (077) 600-0994; 600-0995 National Highway, Brgy. San Vicente MARILAO BRANCH 633-3853
Fax No.: (077) 600-0995 Biñan, Laguna G/F, SM City Marilao Fax No.: (075) 633-3852
Christianne Sophie C. Menrige Tel. Nos.: (049) 511-3196 Km. 21, Brgy. Ibayo, Marilao, Bulacan Jan Rod D. Lloren
245-0440 (Manila line) Tel. Nos.: (044) 815-8956/8957
IRIGA CITY BRANCH Fax No.: (049) 511-3196 Fax No.: (044) 815-8956
Highway 1, JP Rizal St., San Roque Serlita B. Mercado Marites B. Go
Iriga City, Camarines Sur
Tel. Nos.: (054) 299-7000; 456-1498
Fax No.: (054) 456-1498
Ma. Gracia B. Caramoan

China Bank 205 Annual Report 2016

CHINA BANK BRANCHES

PANGASINAN-URDANETA BRANCH SM CITY CLARK BRANCH SOLANO BRANCH TARLAC-CONCEPCION BRANCH

EF Square Bldg., McArthur Highway G/F (Units 172-173) SM City Clark National Highway, Brgy. Quirino G/F Descanzo Bldg., F. Timbol St.
Poblacion, Urdaneta City, Pangasinan M. Roxas St., CSEZ, Angeles City Solano, Nueva Vizcaya San Nicolas, Poblacion
Tel. Nos.: (075) 632-2637 Pampanga Tel. Nos.: (078) 326-6559/60/61 Concepcion, Tarlac
632-0541; 656-2022 Tel. Nos.: (045) 499-0252 to 54 Fax No.: (078) 326-6561 Tel. Nos.: (045) 491-2987; 491-3028
656-2618 Fax No.: (045) 499-0254 Stephen Richard D. Wallis Fax No.: (045) 491-3113
Fax No.: (075) 656-2618 Roderick R. De Leon Abigail B. Garcia
Glenda N. Anonas SORSOGON BRANCH
SM CITY DASMARIÑAS BRANCH CBC Bldg., Ramon Magsaysay Ave. TARLAC-PANIQUI BRANCH
PASEO DE STA. ROSA BRANCH LGF SM City Dasmariñas, Governor’s Sorsogon City, Sorsogon Cedasco Building, M. H del Pilar St.
Unit 3, Paseo 5, Paseo de Sta. Rosa Drive, Pala-pala, Dasmariñas, Cavite Tel. Nos.: (056) 211-1610; 421-5105 Poblacion, Paniqui, Tarlac
Sta. Rosa City, Laguna Tel. No.: (046) 424-1134 Fax No.: (02) 429-1124 (Manila Line) Tel. Nos.: (045) 491-8465; 491-8464
Tel. Nos.: (049) 837-1831 Fax No.: (046) 424-1133 Arthur B. Falcotelo Fax No.: (045) 491-8465
502-3016; 502-2859 Evelyn T. Jardiniano Maximo B. Mendoza, Jr.
827-8178 SUBIC BAY FREEPORT ZONE
420-8042 (Manila line) SM CITY LIPA BRANCH BRANCH THE DISTRICT IMUS BRANCH
Fax No.: 420-8042 (Manila line) G/F (Units 1111-1113) SM City Lipa CBC Bldg., Subic Bay Gateway Park G/F The District Imus, Anabu II
Gerald A. Reta Ayala Highway, Brgy. Maraouy Rizal Highway, Subic Bay Freeport Zone Imus, Cavite
Lipa City, Batangas Tel. Nos.: (047) 252-1568; 252-1575 Tel. Nos.: (046) 416-1417; 416-4294
SAN FERNANDO BRANCH Tel. Nos.: (043) 784-0212; 784-0213 252-1591 Fax No.: (046) 416-4212
CBC Bldg., V. Tiomico St. Fax No.: (043) 784-0212 Fax No.: (047) 252-1575 Divina S. Ramos
San Fernando City, Pampanga Susan Laura K. Valdez Renato S. Cunanan
Tel. Nos.: (045) 961-3542/49 TRECE MARTIRES
963-5458 to 60 SM CITY NAGA BRANCH TABACO CITY BRANCH G/F Waltermart, Governor’s Drive
961-5651; 860-1925 SM City Naga, CBD II Ziga Ave. cor. Berces St. cor. City Hall Road, Brgy. San Agustin
892-3211 Brgy. Triangulo, Naga City Tabaco City, Albay Trece Martires City, Cavite
Fax No.: (045) 961-8352 Tel. Nos.: (054) 472-1366; 472-1367 Tel. Nos.: (052) 487-7150; 830-4178 Tel. Nos.: (046) 460-4897; 460-4898
Gina K. Reyes Fax No.: 250-8183 (Manila Line) Fax No.: 429-1811 (Manila line) 460-4899
Rhoderick F. De Guzman Geoffrey E. Lim Fax No.: (046) 460-4898
SAN FERNANDO-SINDALAN Lhovina A. Delfin
BRANCH SM CITY OLONGAPO BRANCH TAGAYTAY CITY BRANCH
Jumbo Jenra Sindalan, Brgy. Sindalan SM City Olongapo, Magsaysay Dr. Foggy Heights Subdivision TUGUEGARAO CITY BRANCH
San Fernando City, Pampanga cor. Gordon Ave., Brgy. Pag-asa E. Aguinaldo Highway A. Bonifacio St., Tuguegarao
Tel. Nos.: (045) 866-5464; 455-0569 Olongapo City, Zambales Tagaytay City, Cavite Cagayan
Fax No.: (045) 861-3081 Tel. Nos.: (047) 602-0039; 602-0040 Tel. Nos.: (046) 483-0609, 483-0608 Tel. Nos.: (078) 844-0175; 844-0831
Jesus B. Bondoc, Jr. Fax No.: (047) 602-0038 Fax No.: (046) 483-0609 846-1709
Edelmar D. Lee Paula Minette M. Dy Fax No.: (078) 844-0836
SAN JOSE CITY BRANCH Laura L. Utleg
Maharlika Highway, Brgy. Malasin SM CITY PAMPANGA BRANCH TALAVERA BRANCH
San Jose City Unit AX3 102, Building 4, SM City CBC Bldg., Marcos District TUGUEGARAO-BALZAIN BRANCH
Tel. Nos.: (044) 958-9094; 985-9096 Pampanga, Mexico, Pampanga Talavera, Nueva Ecija Balzain Highway, Tuguegarao City
511-2898 Tel. Nos.: (045) 455-0304/0305 Tel. Nos.: (044) 940-2620; 940-2621 Cagayan
Fax No.: (044) 958-9094 455-0306/0307 Fax No.: (044) 940-2620 Tel. Nos.: (078) 396-2207; 396-2208
Josephine D. Cariño Fax No.: (045) 455-0307 Renato P. Del Rosario, Jr. Fax No.: (078) 396-2207
Rosario R. De Ausen Shirly Leocel A. Narag
SAN PABLO CITY BRANCH TARLAC BRANCH
M. Paulino St., San Pablo City SM CITY SAN JOSE DEL MONTE CBC Bldg., Panganiban near cor. VIGAN CITY BRANCH
Tel. Nos.: (049) 562-5481 to 84 BRANCH F. Tanedo St., Tarlac City, Tarlac Burgos St. near cor. Rizal St.
Fax No.: (049) 562-5485 UGF SM City San Jose Del Monte Tel. Nos.: (045) 982-7771 to 75 Vigan City, Ilocos Sur
Oscar B. Villavicencio San Jose Del Monte City, Bulacan Fax No.: (045) 982-7772 Tel. Nos.: (077) 722-6968, 674-2272
Tel. Nos.: (044) 913-1562 Perla S. Aquino Fax No.: (077) 722-6948
SANTIAGO CITY 985-3067 (Manila Line) Maria R. Pelayo
Navarro Bldg., Maharlika Highway near Fax No.: (044) 913-1562 TARLAC-BAMBAN BRANCH
cor. Bayaua St., Santiago City, Isabela Chyrel B. Tuazon National Road, Bgry. Anupul VIRAC BRANCH
Tel. Nos.: (078) 682-7024 to 26 Bamban, Tarlac Quezon Ave., Brgy. Salvacion
Fax No.: (078) 305-2445 SM CITY SAN PABLO BRANCH Tel. Nos.: (045) 925-0402 Virac, Catanduanes
Rafael F. Ilarde G/F SM City San Pablo National Fax No.: (045) Tel. Nos.: (052) 811-4321; 811-4322
Highway, Brgy. San Rafael Armando Arepentido Fax No.: (052) 811-4321
SM CITY BACOOR BRANCH San Pablo City, Laguna Maria Criselda V. Albuero
LGF SM City Bacoor, Tirona Highway Tel. Nos.: (049) 521-0071 to 72 TARLAC-CAMILING BRANCH
cor. Aguinaldo Highway Fax No.: (049) 521-0072 Savewise Super Market, Poblacion ZAMBALES-BOTOLAN BRANCH
Bacoor, Cavite Maria Victoria A. Reyes Camiling, Tarlac Botolan, Zambales
Tel. Nos.: (046) 417-0572/0746 Tel. Nos.: (045) 491-6445; 934-5085 Tel. Nos.: (047) 811-1322; 811-1372
417-0623/0645 SM CITY STA. ROSA BRANCH 934-5086 Fax No.: (047) 811-1322
Fax No.: (046) 417-0583 G/F SM City Sta. Rosa, Bo. Tagapo Fax No.: (045) 934-5085 Rialyn D. Mirador
Elvira M. Montesa Sta. Rosa, Laguna Gary V. Eugenio
Tel. Nos.: (049) 534-4640/4813
Fax No.: 901-1632 (Manila Line)
Antonio C. Manilay

China Bank 206 Annual Report 2016

CHINA BANK BRANCHES

PROVINCIAL BRANCHES- CEBU-AYALA BRANCH CEBU-F. RAMOS BRANCH CEBU-MANDAUE BRANCH

Unit 101 G/F Insular Life Cebu Business F. Ramos St., Cebu City SV Cabahug Building 155-B SB
VISAYAS Center, Mindanao Ave. cor. Biliran Tel. Nos.: (032) 253-9463; 254-4867 Cabahug St., Brgy. Centro
Road, Cebu Business Park, Cebu City 412-5858 Mandaue City, Cebu
ANTIQUE-SAN JOSE BRANCH
Tel. Nos.: (032) 262-1839; 260-6524 Fax No.: (032) 253-9461 Tel. Nos.: (032) 346-5636/37
Felrosa Building, Gen. Fullon St.
Fax No.: (032) 260-6524 Alan Y. Go 346-2083; 344-4335
cor. Cerdena St., San Jose, Antique
Sharon Rose L. Onrejas 422-8188
Tel. Nos.: (036) 540-7095; 540-7097
CEBU-GORORDO BRANCH Fax No.: (032) 346-2083
Fax No.: (036) 540-7096
CEBU-BANAWA BRANCH No 424. Gorordo Ave. Marissa S. Macaraig
Anna Marie B. Sentina G/F The J Block, Duterte St., Banawa Bo. Camputhaw, Lahug District
Guadalupe, Cebu City Cebu City CEBU-MANDAUE-CABANCALAN
BACOLOD-ARANETA BRANCH
Tel. Nos.: (032) 340-9561; 416-3827 Tel. Nos.: (032) 414-0509; 239-8654 BRANCH
CBC Bldg., Araneta cor.
Fax No.: (032) 416-3827 Fax No.: (032) 239-8654 M.L. Quezon St., Cabancalan
San Sebastian Sts., Bacolod City
Sheryll Marie V. Tiu Richard Alexander T. Lim Mandaue City, Cebu
Tel. Nos.: (034) 435-0247/48
Tel. Nos.: (032) 421-1364; 505-9908
433-3818/19
CEBU-BANILAD BRANCH CEBU-GUADALUPE BRANCH Fax No.: (032) 421-1364
433-7152/53; 709-1618
CBC Bldg., AS Fortuna St. CBC Bldg., M. Velez St. Ruel G. Umbay
Fax No.: (034) 435-0247
Banilad, Cebu City cor. V. Rama Ave., Guadalupe
Michelle Lorei R. Gayoma Tel. Nos.: (032) 346-5870/81 Cebu City CEBU-MANDAUE-J CENTRE MALL
416-1001 Tel. Nos.: (032) 254-7964; 254-8495 BRANCH
BACOLOD-LIBERTAD BRANCH
Fax No.: (032) 344-0087 254-1916 LGF J Centre Mall, A.S Fortuna Ave.
Libertad St., Bacolod City
Jouzl Marie C. Roña Fax No.: (032) 032-416-5988 Mandaue City, Cebu
Negros Occidental
Angie G. Divinagracia Tel. Nos.: (032) 520-2898; 421-1567
Tel. Nos.: (034) 435-1645; 435-1646
CEBU-BASAK-SAN NICOLAS Fax No.: (032) 520-2898
Fax No.: (034) 435-1645
BRANCH CEBU-IT PARK BRANCH Mariza O. Lim
Stella D. Aloro N. Bacalso Ave., Basak G/F The Link, Cebu IT Park
San Nicolas, Cebu City Apas, Cebu City CEBU-MANDAUE NORTH ROAD
BACOLOD-MANDALAGAN BRANCH
Tel. Nos.: (032) 340-8113; 414-4742 Tel. Nos.: (032) 266-2559 BRANCH
Lacson St., Mandalagan
Fax No.: (032) 414-4742 262-0982 G/F Units G1-G3, Basak Commercial
Bacolod City, Negros Occidental
Zephyrus C. Celis Fax No.: (032) 266-2559 Building (Kel-2) Basak
Tel. Nos.: (034) 441-0500; 441-0388
Odelon C. Logarta Mandaue City, Cebu
709-0067
CEBU-BOGO BRANCH Tel. Nos.: (032) 345-8861; 345-8862
Fax No.: (034) 709-0067
Sim Building, P. Rodriguez St. CEBU-LAHUG BRANCH 420-6767
Pinky R. Alvarado Bogo City, Cebu JY Square Mall, No. 1 Salinas Fax No.: (032) 420-6767
Tel. Nos.: (032) 434-7119; 266-3251 Dr., Lahug, Cebu City Ferdinand R. Sy
BACOLOD-NORTH DRIVE BRANCH
Fax No.: (032) 434-7119 Tel. Nos.: (032) 417-2122; 233-0977
Anesa Bldg., B.S. Aquino Drive
Mylen D. Comahig 234-2062 CEBU-MANDAUE NRA BRANCH
Bacolod City
Fax No.: (032) 234-2062 G/F Bai Hotel Cebu, Ouano Ave.
Tel. Nos.: (034) 435-0063 to 65
CEBU BUSINESS CENTER Marcos Ronald L. Villahermosa cor. Seno Blvd., North Reclamation Area
709-1658
CBC Bldg., Samar Loop cor. Panay Mandaue City, Cebu
Fax No.: (034) 435-0065
Road, Cebu Business Park, Cebu City CEBU-LAPU LAPU PUSOK BRANCH Tel. No.: (032) 272-6985 (Telefax)
G Romulo F. Lopez Tel. Nos.: (032) 239-3760 G/F Goldberry Suites, President Quezon Maria Casilda P. Rubic
to 239-3764 National Highway, Pusok
BAYBAY BRANCH
Fax No.: (032) 238-1438 Lapu-Lapu City, Cebu CEBU-MINGLANILLA BRANCH
Magsaysay Ave., Baybay, Leyte
Sarah S. Suson Tel. Nos.: (032) 340-2098; 494-0631 Unit 9, Plaza Margarita
Tel. Nos.: (053) 335-2899/98
340-2099 Lipata, Minglanilla, Cebu
563-9228
CEBU-CARCAR BRANCH Fax No.: (032) 340-2098/ 494-0631 Tel. Nos.: (032) 239-7234; 490-6025
Fax No.: (053) 563-9228
Dr. Jose Rizal St., Poblacion I Mary Faith R. Alvez Fax No.: (032) 239-7235
Jose Alvin P. Sumalinog Carcar, Cebu Christine T. Obiña
Tel. Nos.: (032)487-8103; 487-8209 CEBU-LAPU LAPU CENTRO BRANCH
BORONGAN BRANCH
266-7093 G.Y dela Serna St., Opon, Poblacion CEBU-NAGA BRANCH
Balud II, Poblacion, Borongan
Fax No.: (032) 487-8103 Lapu Lapu City, Cebu Leah’s Square, National South Highway
Eastern Samar
Mary Ann C. Rio Tel. Nos.: (032) 231-3247; 493-5078 East Poblacion, Naga City, Cebu
Tel. Nos.: (055) 560-9948; 560-9938
Fax No.: (032) 231-3247 Tel. Nos.: (032) 238-7623; 489-8218
261-5888
CEBU-CONSOLACION BRANCH Joseph Y. Dañosos Fax No.: (032) 489-8218
Fax No.: (055) 560-9938
G/F SM City Consolacion Sheila R. Pastor
Henedina M. Afable Brgy. Lamac, Consolacion, Cebu CEBU-MAGALLANES BRANCH
Tel. Nos.: (032) 260-0024; 260-0025 CBC Bldg., Magallanes CEBU-SM CITY BRANCH
CATARMAN BRANCH
Fax No.: (032) 423-9253 cor. Jakosalem Sts., Cebu City Upper G/F, SM City Cebu, Juan Luna
cor. Rizal & Quirino Sts., Jose P. Rizal St.
Mary Jayne D. Caballero Tel. Nos.: (032) 255-0022/23/25/28 cor. A. Soriano Ave., Cebu City
Catarman, Northern Samar
253-0348;255-6093 Tel. Nos.: (032) 232-0754/55
Tel. Nos.: (055) 251-8802/8821
CEBU-ESCARIO BRANCH 255-0266; 412-1877 231-9140; 412-9699
500-9921
Units 3 & 5 Escario Central Fax No.: (032) 255-0026 Fax No.: (032) 232-1448
Fax No.: (055) 500-9921
Escario Road, Cebu City Susan Y. Tang Alex M. Campilan
Victorino T. Caparroso, Jr. Tel. Nos.: (032) 416-5860; 520-9229
Fax No.: (032) 520-9229 CEBU-SM SEASIDE CITY BRANCH
CATBALOGAN BRANCH
Edgardo A. Olalo LGF SM Seaside City Cebu, South Road
CBC Bldg., Del Rosario St.
Properties, 6000, Cebu City
cor. Taft Ave., Catbalogan City, Samar
Tel. No.: (032) 262-1772
Tel. Nos.: (055) 251-2897/98
Fax No.: (032) 262-1772
543-8121
Ronnie A. Aguilar
Fax No.: (055) 543-8279
Paul C. Oliva

China Bank 207 Annual Report 2016

CHINA BANK BRANCHES

CEBU-SUBANGDAKU BRANCH KALIBO BRANCH TAGBILARAN CITY BRANCH CAGAYAN DE ORO-GAISANO CITY
Alpa Centrum, Subangdaku Waldolf Garcia Building G/F Melrose Bldg., Carlos P. Garcia Ave. MALL BRANCH
Mandaue City, Cebu Osmeña Ave., Kalibo, Aklan Tagbilaran City, Bohol G/F Gaisano City Mall, C. M. Recto
Tel. Nos.: (032) 344-6561; 422-3664 Tel. Nos.: (036) 500-8088; 500-8188 Tel. Nos.: (038) 501-0688; 501-0677 cor. Corrales Extension
344-6621 268-2988 411-2484 Cagayan de Oro City
Fax No.: (032) 344-6621 Fax No.: (036) 500-8188 Fax No.: (038) 501-0677 Tel. Nos.: (08822) 745-877; 745-880
Leah Liza L. Lagumbay Marylen T. Gerardo Karen Jean T. Maslog (088) 880-1051; 880-1052
Fax No.: (08822) 745-880
CEBU-TALAMBAN BRANCH MAASIN CITY BRANCH Gina C. Telow
Unit UG-7 Gaisano Grand Mall G/F SJC Bldg., Tomas Oppus St. PROVINCIAL BRANCHES-
Brgy. Talamban, Cebu City Brgy. Tunga-Tunga, Maasin City COTABATO CITY BRANCH
Tel. Nos.: (032) 236-8944; 418-0796 Southern Leyte MINDANAO No. 76 S.K. Pendatun Ave.
Fax No.: (032) 236-8944 Tel. Nos.: (053) 381-2287; 381-2288 Cotabato City, Maguindanao
Genil Y. Espedido 570-8488 BUTUAN CITY BRANCH Tel. Nos.: (064) 421-4685/4653
Fax No.: (053) 570-8488 CBC Bldg., J.C. Aquino Ave. Fax No.: (064) 421-4686
CEBU-TALISAY BRANCH Maria Luisa V. Gonzales Butuan City Ariel Cesar O. Romero
CBC Bldg., 1055 Cebu South National Tel. Nos.: (085) 341-5159; 341-7445
Road, Bulacao, Talisay City, Cebu NEGROS OCC.-KABANKALAN (085) 815-3454/55 DAVAO-BAJADA BRANCH
Tel. Nos.: (032) 272-3342/48 BRANCH 225-2081 B.I. Zone Building, J.P. Laurel Ave.
491-8200 CBC Bldg., National Highway Fax No.: (085) 815-3455 Bajada, Davao City
Fax No.: (032) 272-3346 Brgy. 1, Kabankalan, Negros Occidental Sheelah A. Kho Tel. Nos.: (082) 221-0184; 221-0319
Rosie T. Faytone Tel. Nos.: (034) 471-3349; 471-3364 Fax No.: (082) 221-0568
471-3738 CAGAYAN DE ORO-BORJA BRANCH Abigail O. Sintos
DUMAGUETE CITY BRANCH Fax No.: (034) 471-3349 J. R. Borja St., Cagayan de Oro City
CBC Bldg., Real St., Dumaguete City Ross Ariel T. Tan Tel. Nos.: (08822) 724-832/33 DAVAO-BUHANGIN BRANCH
Negros Oriental 726-076 Buhangin Road, Davao City
Tel. Nos.: (035) 422-8058; 225-5442 NEGROS OCC.-SAN CARLOS (088) 857-3742 Tel. Nos.: (082) 300-8335; 227-9764
225-5441; 225-4284 BRANCH Fax No.: (088) 857-2212 221-5970
225-5460 Rizal cor. Carmona Sts. Janet G. Tan Fax No.: (082) 221-5970
Fax No.: (035) 422-5442 San Carlos, Negros Occidental Roberto A. Alag
Iris Gail C. Pantino Tel. Nos.: (034) 312-5818; 312-5819 CAGAYAN DE ORO-CARMEN
729-3276 BRANCH DAVAO-CALINAN BRANCH
ILOILO-IZNART BRANCH Fax No.: (034) 729-3276 G/F GT Realty Building, Max Suniel St. Davao- Bukidnon National Highway –
G/F John A. Tan Bldg., Iznart St. Mercedita C. Cortez cor. Yakal St., Carmen Riverside, Calinan Proper, Davao City
Iloilo City Cagayan de Oro City Tel. Nos.: (082) 224-9229; 224-9135
Tel. Nos.: (033) 337-9477 ORMOC CITY BRANCH Tel. Nos.: (08822) 723-091; 724-372 Fax Nos.: (082) 224-9229
509-9868; 300-0644 CBC Bldg., Real cor. (088) 858-3902/03 Chris G. Dolar
Fax No.: (033) 337-9566 Lopez Jaena Sts., Ormoc City, Leyte Fax Nos.: (088) 858-3903
Marjorie C. Mangilin Tel. Nos.: (053) 255-3651 to 53 (08822) 724-372 DAVAO-INSULAR VILLAGE BRANCH
Fax No.: (053) 561-8348 Jane Byzallel G. Quirante (formerly Davao–Lanang Branch)
ILOILO-JARO BRANCH Warren Noel M. Del Valle Insular Village I, Km. 8, Lanang
CBC Bldg., E. Lopez St. CAGAYAN DE ORO-DIVISORIA Davao City
Jaro, Iloilo City PUERTO PRINCESA CITY BRANCH BRANCH Tel. Nos.: (082) 300-1892
Tel. Nos.: (033) 320-3738; 320-3791 Malvar St. near cor. Valencia St. RN Abejuela St., South Divisoria 234-7166;234-7165
Fax No.: (033) 503-2955 Puerto Princesa City, Palawan Cagayan de Oro City Fax No.: (082) 300-1892
Joseph C. Chong Tel. Nos.: (048) 434-9891 to 93 Tel. Nos.: (08822) 722-641 Joselito S. Crisostomo
Fax No.: (048) 434-9892 (088) 857-5759
ILOILO-MABINI BRANCH Joselito V. Cadorna Fax No.: (088) 857-4200 DAVAO-MA-A BRANCH
A. Mabini St., Iloilo City Crescencio Al C. Co Untian G/F Lapeña Building, McArthur
Tel. Nos.: (033) 335-0295; 335-0370 ROXAS CITY BRANCH Highway, Matina, Davao City
509-0599 1063 Roxas Ave. cor. Bayot Drive CAGAYAN DE ORO-LAPASAN Fax Nos.: (082) 295-0472; 295-1072
Fax No.: (033) 335-0370 Roxas City, Capiz BRANCH Maria Eloise D. Maniti
Sharlan C. Go Tel. Nos.: (036) 621-3203; 621-1780 CBC Bldg., Claro M. Recto Ave.
522-5775 Lapasan, Cagayan de Oro City DAVAO-MATINA BRANCH
ILOILO-MANDURRIAO BRANCH Fax No.: (036) 621-3203 Tel. Nos.: (08822) 722-240; 724-540 Km. 4 McArthur Highway
Benigno Aquino Ave., Brgy. San Rafael Anthony V. Arguelles 726-242 Matina, Davao City
Mandurriao, Iloilo City (088) 856-1325/1326 Tel. Nos.: (082) 297-4288; 297-4455
Tel. Nos.: (033) 333-3988; 333-4088 SILAY CITY BRANCH Fax Nos.: (088) 856-1325/1326 297-5880/81
Fax No.: (033) 501-6078 Rizal St., Silay City, Negros Occidental 856-5063 (area office) Fax No.: (082) 297-5880
Rose Marie Y. Oquendo Tel. Nos.: (034) 714-6400; 495-5452 James M. Bomediano Petronila G. Narvaez
495-0480
ILOILO-RIZAL BRANCH Fax No.: (034) 495-0480 CAGAYAN DE ORO-PUERTO BRANCH DAVAO-PANABO CITY BRANCH
CBC Bldg., Rizal cor. Gomez Sts. Olimpia L. Diones Luis A.S. Yap Building, Zone 6 PJ Realty, Barangay New Pandan
Brgy. Ortiz, Iloilo City Brgy. Puerto, Cagayan de Oro City Panabo City, Davao del Norte
Tel. Nos.: (033) 336-0947; 338-2136 TACLOBAN CITY BRANCH Misamis Oriental Tel. Nos.: (084) 628-4057; 628-4065
509-8838 Uytingkoc Building, Avenida Veteranos Tel. Nos.: (088) 880-7183; 880-7185 Fax No.: (084) 628-4053
Fax No.: (033) 338-2144 Tacloban City, Leyte Fax No.: (088) 880-7185 Noemi I. Altar
Thea Marie U. Yap Tel. Nos.: (053) 325-7706 to 08 Jasmine L. Soriano
523-7700/7800
Fax No.: (053) 523-7700
Felina G. Reyes

China Bank 208 Annual Report 2016

CHINA BANK BRANCHES

DAVAO-RECTO BRANCH ILIGAN CITY BRANCH ZAMBOANGA CITY BRANCH Lipa City-Tambo Branch
CBC Bldg., C.M. Recto Ave. Lai Building, Quezon Ave. Ext. CBC Bldg., Gov. Lim Ave. Tambo, Lipa City, Batangas
cor. J. Rizal St., Davao City Pala-o, Iligan City cor. Nuñez St., Zamboanga City
Tel. Nos.: (082) 221-4481/7028 Tel. Nos.: (063) 221-5477/79 Tel. Nos.: (062) 991-2978/79 Macapagal Ave.-Aseana Square
221-6021/6921/4163 492-3009; 221-3009 991-1266 Branch
226-3851; 226-2103 Fax No.: (063) 492-3010 Fax No.: (062) 991-1266 Aseana Square (Caltex Area)
Fax No.: (082) 221-8814 Ronald O. Lua Jaime G. Asuncion D. Macapagal Ave., Aseana City
Carlos C. Tan, Jr. Parañaque City
KIDAPAWAN CITY BRANCH ZAMBOANGA-GUIWAN BRANCH
DAVAO-STA. ANA BRANCH G/F EVA Building, Quezon Blvd. G/F Yang’s Tower Macapagal Ave.-Biopolis Branch
R. Magsaysay Ave. cor. cor. Tomas Claudio St., National M.C. Lobregat National Highway G/F The Biopolis, Central Business Park
F. Bangoy St., Sta. Ana District Highway, Kidapawan City Guiwan, Zamboanga City 1-A 076 / 01, Diosdado Macapagal
Davao City Tel. Nos.: (064) 278-3509; 278-3510 Tel. Nos.: (062) 984-1751; 984-1754 Avenue, Pasay City
Tel. Nos.: (082) 227-9501/51 Fax No.: (064) 278-3509 Fax No.: (062) 984-1751
227-9601; 221-1054/55 Wilbert R. Baus Alexander B. Lao Novaliches-Sta. Monica
221-6672 G/F E & V Bldg., Quirino Highway
Fax No.: (082) 226-4902 KORONADAL CITY BRANCH ZAMBOANGA-SAN JOSE GUSU cor. Dumalay St., Novaliches
Elinor U. Toe Gen. Santos Drive cor. Aquino St. BRANCH Quezon City
Koronadal City, South Cotabato Yubenco Supermarket, San Jose Gusu
DAVAO-SM LANANG BRANCH Tel. Nos.: (083) 228-7838; 228-7839 Zamboanga City, Zamboanga del Sur Ortigas-Tektite Branch
G/F SM Lanang Premier 520-1788 Tel. Nos.: (062) 995-6154; 955-6155 Unit EC-06B PSE Center (Tektite)
J.P. Laurel Ave., Davao City Fax No.: (083) 228-7839 Fax No.: (062) 955-6154 Ortigas Center, Pasig City
Tel. Nos.: (082) 285-1064 Rizkie E. Zaragoza Dennis T. Wong Yat
285-1053 Parañaque-Baclaran Branch
Fax No.: (082) 285-1520 MALAYBALAY CITY BRANCH Quirino Ave. cor. Aragon St.
Janice S. Laburada Bethelda Building, Sayre Highway SOON TO OPEN Baclaran, Parañaque City
Malaybalay City, Bukidnon
DAVAO-TAGUM BRANCH Tel. No.: (088) 813-3372 Ayala Ave.-Amorsolo Branch Quezon-Candelaria Branch
153 Pioneer Ave. Fax No.: 813-3373 G/F Teleperformance Bldg. Rizal Street, Poblacion
Tagum, Davao del Norte Randolf M. Corrales Ayala Ave., Makati City Candelaria, Quezon
Tel. Nos.: (084) 655-6307/08
400-2289/90 MIDSAYAP BRANCH Batangas-Balayan Branch Rockwell-Ortigas Branch
Fax No.: (084) 400-2289 CBC Bldg., Quezon Ave. CBC Building (for construction) G/F Tower 1 Rockwell Business Center
Ernesto A. Santiago, Jr. Poblacion 2, Midsayap, Cotabato Barrio Ermita, Balayan, Batangas Ortigas Ave., Pasig City
Tel. No.: (064) 229-9700
DAVAO-TORIL BRANCH Fax No.: (064) 229-9750 BGC-W Tower Branch Tarlac City-San Rafael Branch
McArthur Highway Ma. Estrella B. Velasco G/F W Tower, 39th St., North Bonifacio Brgy. San Rafael, Tarlac City, Tarlac
cor. St. Peter St., Crossing Bayabas Triangle, Fort Bonifacio Global City
Toril, Davao City OZAMIZ CITY BRANCH Taguig City 1634 Parañaque-San Antonio Valley
Tel. Nos.: (082) 303-3068; 295-2334 Gomez cor. Kaamino Sts. Branch
295-2332 Ozamiz City Calbayog City Branch San Antonio Shopping Center
Fax No.: (082) 295-2332 Tel. Nos.: (088) 521-2658 to 60 Cajurao cor. Gomez Sts., Balud San Antonio Road, Brgy. San Antonio
Gregorio E. Cuta Fax No.: (088) 521-2659 Calbayog Dist., Calbayog City, Samar Valley 1, Parañaque City
Jefferson A. Go
DIPOLOG CITY BRANCH Camalaniugan Branch Sct. Borromeo Branch
CBC Bldg., Gen Luna PAGADIAN CITY BRANCH CBC Building (for construction) National G/F The Forum Bldg.
cor. Gonzales Sts., Dipolog City Marasigan Bldg., F.S. Pajares Ave. Highway, Camalaniugan, Cagayan 71-A Sct. Borromeo St.
Tel. Nos.: (065) 212-6768 to 69 Pagadian City Diliman, Quezon City
908-2008 Tel. Nos.: (062) 215-2781/82 Katipunan Ave-Loyola Heights
Fax No.: (065) 212-6769 925-1116 Branch Sto. Domingo Ave. Branch
Ma. Jesusa Perpetua F. Recentes Fax No.: (062) 214-3877 Elizabeth Hall, Katipunan Ave. Sto. Domingo Ave., Quezon City
Jumilito A. Dayuna Loyola Heights, Quezon City
GEN. SANTOS CITY BRANCH Tandang Sora-Visayas Ave. Branch
CBC Bldg., I. Santiago Blvd. SURIGAO CITY BRANCH Laguna-San Pedro Branch #250 Tandang Sora Ave., Quezon City
Gen. Santos City CBC Bldg., Amat St. No. 365 Brgy. Nueva, National Highway
Tel. Nos.: (083) 553-1618; 552-8288 Barrio Washington, Surigao City San Pedro City, Laguna Tomas Morato-E. Rodriguez Branch
Fax No.: (083) 553-2300 Surigao del Norte Tomas Morato Ave., Quezon City
Helen Grace L. Fernandez Tel. Nos.: (086) 826-3958, 826-3968 Las Piñas-Marcos Alvarez Ave.
Fax No.: (086) 826-3958 Branch
GEN. SANTOS CITY-DADIANGAS Eivith Shenir C. Florendo Metro Towne Center
BRANCH 2020 Marcos Alvarez Ave.
M. Roxas Ave. cor. Lapu-Lapu St. VALENCIA BRANCH Las Piñas City
Brgy. Dadiangas East, Gen. Santos City A. Mabini St., Valencia, Bukidnon
South Cotabato Tel. Nos.: (088) 828-2048/49 Las Piñas-Naga Road Branch
Tel. No.: (083) 552-8576 222-2356; 222-2417 Lot 3, Naga Road, Pulanglupa 2
Fax No.: (083) 552-8290 Fax No.: (088) 828-2048 Las Piñas City
Lorena P. Abejero Gilmar L. Villaruel

China Bank 209 Annual Report 2016

CHINA BANK SAVINGS BRANCHES

METRO MANILA AND RIZAL BACLARAN ESPAÑA–SUN MALL LAGRO

3751 Quirino Ave. Sun Mall Bonaza Building
ACACIA ESTATES–SAVEMORE cor. Sta. Rita St. España Boulevard cor. Mayon St. Quirino Highway, Greater Lagro
Acacia Taguig Town Center Baclaran, Parañaque City Brgy. Sta. Teresita, Quezon City Novaliches, Quezon City
Acacia Estates, Ususan, Taguig City Mobile No.: 0917-703-2503 Tel. Nos.: (02) 244-2476; 244-2477 Tel. Nos.: (02) 936-4988; 461-7214
Tel. Nos: (02) 633-5472; 964-1318 Jasmin T. Vergara Florante Juan Marcelino G. Sison
Mobile No.: 0917-510-6013
BANAWE FELIX HUERTAS–JT CENTRALE LAS PIÑAS
ADRIATICO–HYPERMARKET 247-249 Banawe St. JT Centrale Mall, G/F Unit 103 Parco Supermarket
M.H. Del Pilar, Adriatico Sta. Mesa Heights Fugoso cor. Felix Huertas St. J. Aguilar Ave., Las Piñas City
Malate, Manila Brgy. Lourdes, Quezon City Sta. Cruz, Manila Tel. No.: (02) 548-0368
Tel. No.: (02) 525-6282 Tel. Nos.: (02) 412-6249; 256-4941 Tel. Nos.: (02) 247-3177; 247-3181 Mobile No.: 0917-830-3268
Kristina Concepcion Dino Laforteza 796-2421 Geraldine Dina
Mobile No.: 0917-553-8446
ALABANG HILLS BANGKAL Marcon Rodel Mendoza LAS PIÑAS–ALMANZA UNO
Alabang Commercial Citi Arcade Amara Building Alabang-Zapote Road
Don Jesus Boulevard 1661 Evangelista St. FILINVEST CORPORATE CITY Almanza Uno, Las Piñas City
Alabang, Muntinlupa City Bangkal, Makati City BC Group Building, East Asia Drive Tel. No.: (02) 551-4724; 966-9001
Tel. No.: (02) 403-2801 Tel. Nos.: (02) 621-3459; 621-3461 near cor. Commerce Ave. Mobile No.: 0917-817-3526
Jose Angelo Gonzaga Erica Abolencia Filinvest Corporate City Geraldine Dina
Alabang, Muntinlupa City
AMANG RODRIGUEZ–SAVEMORE BINONDO–JUAN LUNA Tel. No.: (02) 511-1152 MAKATI–CHINO ROCES
Amang Rodriguez Ave. 694-696 Juan Luna St. Fax No: (02) 511-1145 Graceland Plaza
cor. Evangelista St. Binondo, Manila Mobile No.: 0917-804-6443 2176 Chino Roces Ave.
Santolan, Pasig City Tel Nos.: (02) 254-0371; 254-7337 Kristina Tricia Balagat Pio del Pilar, Makati City
Tel. Nos.: (02) 654-0564; 645-4710 964-1327 Tel. No.: (02) 831-0477; 964-1322
Emmanuel Formeloza Erlinda C. Sia FTI–TAGUIG HYPERMARKET Cristina Sanchez
DBP Ave., Food Terminal Incorporated
AMORANTO AVENUE BUENDIA Western Bicutan, Taguig City MAKATI–J.P. RIZAL
Unit 101 R Place Building CBS Building Tel. Nos.: (02) 834-0408; 507-4090 882 J.P. Rizal St.
255 N.S Amoranto Sr. Ave. 314 Sen. Gil Puyat Ave., Makati City Poblacion, Makati City
Quezon City Tel. No.: (02) 812-9359 GREENHILLS–ORTIGAS AVENUE Tel. Nos.: (02) 890-1026; 890-1027
Tel. No.: (02) 966-9075 Trunkline: (02) 884-7600 locals 3900 VAG Building, Ortigas Ave. Mobile No.: 0917-510-5919
Mobile. No.: 0917-805-6964 to 3902 and 7645 Greenhills, San Juan City Jude A. Ednilag
Theresa Georgia P. Bautista Einar Salle Tel. Nos.: (02) 721-0105; 724-7523
724-7528 MALABON–SAVEMORE
ANGONO COMMONWEALTH AVENUE Ma. Jennifer V. Bondoc Francis Market
M.L. Quezon Ave. JocFer Building Governor Pascual cor. M.H. Del Pilar St.
Angono, Rizal Commonwealth Ave. GREENHILLS–WILSON Malabon
Tel. No.: (02) 651-1782 Brgy. Holy Spirit, Quezon City 219 Wilson St. Tel. No.: (02) 931-6326
Fax No: (02) 651-1779 Tel. No.: (02) 957-0559 Greenhills, San Juan City Marleon Josef Camiling
Lourdes V. Quitoriano Mobile No.: 0917-521-3469 Tel. Nos.: (02) 748-7625
Cynthia Altiche 584-5946 MANDALUYONG
ANONAS–SAVEMORE Josephine Joy T. Rillera Paterno’s Building
Maamo St., Road Lot 30 CUBAO 572 New Panaderos St.
V. Luna St. and Anonas Extension Fernandina 88 Condominium KALOOKAN Brgy. Pag-asa, Mandaluyong City
Sikatuna, Quezon City 222 P. Tuazon Boulevard Augusto Building, Rizal Ave. Tel. Nos.: (02) 238-3745, 238-3744
Tel. No.: (02) 351-4928 Araneta Center, Cubao, Quezon City Grace Park, Kalookan City Dean I. Martin
Mobile No.: 0917-863-6157 Tel. Nos.: (02) 913-5209 Tel. No.: (02) 365-7593
Angelito Domingo 913-4903 Jude Toribio MANDALUYONG–SHAW
Wendell M. Gaza BOULEVARD
ANTIPOLO KALOOKAN–MABINI 500 Shaw Tower, 500 Shaw Boulevard
EMS Building, L1 M.L. Quezon DEL MONTE AJ Building Mandaluyong City
cor. F. Dimailig St., Brgy. San Roque 392 Del Monte Ave. 353 A. Mabini St., Kalookan City Tel. No.: (02) 941-9412
Antipolo City, Rizal Brgy. Sienna, Quezon City Tel. Nos.: (02) 961-2628; 709-3435 Mobile No.: 0917-580-6593
Tel. No.: (02) 697-1066 Tel. No.: (02) 741-2447 Abner B. Aballa Stephanie B. Villanueva
Fax No.: (02) 697-0224 Fax No.: 741-8285
Ma. Cecilia C. Oxales Jobel Arana KAPASIGAN MANILA–STA.ANA SAVEMORE
A. Mabini St. Savemore Pedro Gil St.
ARANETA CENTER C.O.D.– DIVISORIA DRAGON 8 Kapasigan, Pasig City Sta. Ana, Manila
SAVEMORE Dragon 8 Shopping Center, 3/Flr Tel. No.: (02) 642-2870 Tel. Nos.: (02) 523-8574; 523-8606
Gen. Romulo St., Araneta Center C.M Recto Ave. cor. Dagupan St. Fax No.: (02) 640-7085 987-4975
Cubao, Quezon City Divisoria, Manila Edgardo N. Alejandro Francisco Buenaflor
Tel. Nos.: (02) 921-3147; 502-1437 Tel. Nos.: (02) 244-5960; 244-1068
Mobile No.: 0917-809-9670 Erlinda C. Sia KATIPUNAN AVENUE MANILA–STA. CRUZ
Wendell M. Gaza One Burgundy Condominium (to open May 2017)
E. RODRIGUEZ SR.–HEMADY Katipunan Ave., Loyola Heights Multi-Pacific Business Inc. Building
AYALA AVENUE Hemady Square, E. Rodriguez Ave. Quezon City Plaza Sta. Cruz, Sta. Cruz, Manila
VGP Center cor. Doña Hemady St. Tel. Nos.: (02) 931-1123; 211-7882
6772 Ayala Ave., Makati City New Manila, Quezon City Fax No.: (02) 288-4360 MARIKINA
Tel. Nos.: (02) 864-5017; 864-5065 Tel. Nos.: (02) 987- 4966 Mobile No.: 0917-628-3318 33 Bayan-Bayanan Ave.
864-5011 531-9676; 531-9680 John Paul C. Racines Brgy. Concepcion 1, Marikina City
Benjy Roland E. Herce Mobile No.: 0917-808-5214 Tel. Nos.: (02) 477-2445; 943-6037
Keith Icaro Razelyn J. Afuang

China Bank 210 Annual Report 2016

CHINA BANK SAVINGS BRANCHES

MARIKINA–GIL FERNANDO AVE. PARAÑAQUE–JAKA PLAZA QUIAPO–QUEZON BOULEVARD NORTH LUZON

CTP Building Jaka Plaza Center 416 Quezon Boulevard
Gil Fernando Ave., Marikina City Dr. A. Santos Ave. (Sucat Road) Quiapo, Manila ANGELES–RIZAL
Tel. Nos.: (02) 681-2810; 645-8169 Brgy. San Isidro, Parañaque City Tel. Nos.: (02) 247-3297; 247-3298 639 Rizal St., Angeles City
Cecilia Sta. Maria Tel. No.: (02) 820-6093 Tel. Nos.: (045) 323-4303
Fax No.: (02) 820-6091 RADA–LEGASPI 625-9722
McKINLEY HILL Howard M. Abedo HRC Center, 104 Rada St. Fax No.: (045) 888-4971
Commerce and Industry Plaza Legaspi Village, Makati City Christopher G. Benitez
Upper Basement PARAÑAQUE–LA HUERTA Tel. Nos.: (02) 810-9369; 818-2368
McKinley Town Center 1070 Quirino Ave. 812-2577 ANGELES–SAN JOSE
Campos Ave. cor. Park Ave. La Huerta, Parañaque City Fax No.: (02) 810-9370 Sto. Rosario St.
McKinley Hill, Taguig City Tel. No.: (02) 893-1226 Amapola A. Guina San Jose, Angeles City
Tel. Nos.: (02) 403-0425; 798-0357 Marilet C. Valerio Tel. Nos.: (045) 409-0234
403-9413 SAN JUAN CITY 888-2048
Joana V. Siochi PARAÑAQUE–MOONWALK Madison Square Maria Beata P. Larin
Kassel Residence 264 N. Domingo St.
MUÑOZ JACKMAN–SAVEMORE E. Rodriguez Ave. Brgy. Pasadena, San Juan City ARAYAT
Jackman Plaza, Lower Ground Floor Moonwalk, Parañaque City Tel. No.: (02) 507-4147 Cacutud, Arayat, Pampanga
EDSA – Muñoz, Quezon City Tel. Nos.: (02) 664-1923, 957-2339 Mobile No.: 0917-561-5639 Tel. No.: (045) 885-2390
Tel. No.: (02) 442-6282 Mobile No.: 0917-621-8321 Jeanette Mae E. Castillo Ma. Rowena C. Cura
Angelito Domingo Rinamarie Lychelle F. Vibal
TAFT MASAGANA–SAVEMORE BAGUIO–SESSION
NEPA-Q MART–SAVEMORE PASIG–CANIOGAN Parkview Plaza, Trida Building B 108 Lopez Building, Session Road
770 Saint Rose Building KSN Building, C. Raymundo Ave. Taft Ave. cor. T.M. Kalaw St. cor. Assumption Road, Baguio City
EDSA and K-G St. Caniogan, Pasig City Ermita, Manila Tel. Nos.: (074) 446-3993
West Kamias, Quezon City Tel. No.: (02) 957-0817 Tel. No.: (02) 554-0617 446-3994
Tel. No.: (02) 351-4883 Redmund Pascual Mobile No.: 0917-538-2421 Ma. Elena F. Estira
Mobile No.: 0917-863-6069
Wendell M. Gaza PASIG–PADRE BURGOS TAYTAY BALAGTAS
114 Padre Burgos St. C. Gonzaga Building II Brgy. Wawa, MacArthur Highway
NINOY AQUINO AVE Kapasigan, Pasig City Manila East Road, Taytay, Rizal Balagtas St., Bulacan
Skyfreight Building, G/F Tel. Nos.: (02) 650-3356; 650-3361 Tel. Nos.: (02) 650-3367; 623-6113 Tel. No.: (044) 693-1849
Ninoy Aquino Ave. cor. Pascor Drive 650-3362 Mobile No.: 0917-578-6978 Maita D.R. de Guzman
Parañaque City Joseph Arnold R. Miraflor Mary Joy Surla
Tel. Nos.: (02) 843-2447; 239-0574 BALANGA–D.M. BANZON
Rafael Ma. C. Guerra III PASO DE BLAS TAYUMAN D.M. Banzon Street
Andoks Building, 629 Gen. Luis St. 1925-1929 Rizal Ave. Balanga City, Bataan
NOVA PLAZA MALL–SAVEMORE Malinta Interchange – NLEX near cor. Tayuman St. Tel. No.: (047) 237-3667
Novaliches Plaza Mall Paso de Blas, Valenzuela City Sta. Cruz, Manila Mary Jane L. Sazon
Quirino Highway cor. Ramirez St. Tel. No.: (02) 984-8258 Tel. Nos.: (02) 230-3091; 247-0683
Novaliches Proper, Quezon City Fax No.: (02) 984-8258 586-1618 BALIBAGO
Tel. No.: (02) 983-1512 Mary Jane Anasta Nathaniel Villanueva JEV Building, MacArthur Highway
Angelito Domingo Balibago, Angeles City
PATEROS TIMOG Tel. No.: (045) 892-3325
ORTIGAS–CITRA 500 Elisco Road Jeinkinsen Towers Condominium Maricel E. Manalang
Unit B1, OMM Citra Building Sto. Rosario, Pateros City 80 Timog Ave., Quezon City
San Miguel Ave., Ortigas Center Tel. Nos.: (02) 655-2349; 641-9556 Tel. Nos.: (02) 371-8303; 371-8304 BALIUAG
Pasig City Ida Daphne Dela Torre 371-8305 Mariano Ponce Building
Tel. Nos.: (02) 637-9778; 637-9824 Randal Ignatius Z. Razo Plaza Naning, Baliuag, Bulacan
637-2018 PATEROS–ALMEDA Tel. Nos.: (044) 766-2014
Irmina V. Dator 120 M. Almeda St. TWO E-COM 673-1338
Pateros City Two E-Com Center Tower B Marikris Agustin
ORTIGAS CENTER Tel. Nos.: (02) 641-6768; 641-6760 Ocean Drive cor. Bayshore Drive
Hanston Square, San Miguel Ave. Santos F. Guadines Mall of Asia Complex, Pasay City CABANATUAN
Ortigas Center, Pasig City Tel. Nos.: (02) 802-3068; 802-5583 Km. 115 Cagayan Valley Road
Tel. Nos.: (02) 654-1912; 477-3439 PEDRO GIL–SAVEMORE 587-4753 Maharlika Highway
Mobile No.: 0917-807-8394 Pedro Gil cor. Singalong St. Mobile No.: 0917-506-8303 near cor. Sanciangco St.
Gilda Brigida C. Alunan Paco, Manila Jazmin Vergara Cabanatuan City, Nueva Ecija
Tel. Nos.: (02) 354-3117; 521-4056 Tel. Nos.: (044) 940-6943
PARAÑAQUE–BETTER LIVING UN AVENUE 940-6942; 940-6944
90 Doña Soledad Ave. QUEZON AVENUE–PALIGSAHAN 552 United Nations Ave. Theresa Padiernos
Better Living Subdivision 1184-A Ben-Lor Building Ermita, Manila
Bicutan, Parañaque City Brgy. Paligsahan, Quezon City Tel. Nos.: (02) 400-5468; 400-5467 CABANATUAN–BAYAN
Tel. Nos.: (02) 551-3600; 831-8507 Tel. Nos.: (02) 376-4546; 376-4548 Edward Lyndon M. Dimapilis Burgos Ave., Cabanatuan City
507-4116 376-4544 Tel. No.: (044) 600-2888
Mobile No.: 0917-561-5576 Randal Ignatius Z. Razo VALENZUELA–MARULAS Theresa Padiernos
Dimples O. Dacio 92-J MacArthur Highway
QUEZON AVENUE Marulas, Valenzuela City DAGUPAN
PARAÑAQUE–BF HOMES GJ Building, 385 Quezon Ave. Tel. Nos.: (02) 291-6542; 291-6541 Lyceum–Northwestern University
284 Aguirre Ave. West Triangle, Quezon City Rowena Morenos Ground Floor, Tapuac District
B.F. Homes, Parañaque City Tel. Nos.: (02) 332-2639; 332-2638 Dagupan City
Tel. Nos.: (02) 553-5414; 964-1292 Mobile No.: 0917-538-2423 VISAYAS AVENUE Tel. No.: (075) 523-3637
Mobile No.: 0917-510-5911 Helena Rowena Abanto Wilcon City Center Mall Gingin T. Aquino
Maria Francesca J.Corporal Upper Ground Floor Visayas Ave.
Quezon City
Tel. Nos.: (02) 990-7717; 990-6543
990-6544
Ma. Victoria I. Calderon

China Bank 211 Annual Report 2016

CHINA BANK SAVINGS BRANCHES

DAGUPAN–PEREZ BOULEVARD MEYCAUAYAN SAN JOSE DEL MONTE URDANETA

Burgos Extension Mancon Building Giron Building, Gov. Halili Ave. MacArthur Highway, Nancayasan
cor. Perez Boulevard, Lingayen Highway MacArthur Highway Tungkong Mangga, City of San Jose Urdaneta City, Pangasinan
Dagupan City Calvario, Meycauayan, Bulacan Del Monte, Bulacan Tel No.: (075) 624-2331
Tel. No.: (075) 515-7600 Tel. Nos.: (044) 228-2416 Tel. Nos.: (044) 815-8396 Fax No.: (075) 522-0498
Fax No.: (075) 522-9586 840-0099 815-6616 Loreto V. Munoz Jr.
Ma. Suzette D. Ramos Roberto S. Evangelista Mobile No.: 0917-835-4675
Othello C. Mendoza VIGAN
DAU MOUNT CARMEL Agdamag Building, Quezon Ave.
MacArthur Highway Km. 78 MacArthur Highway SAN MIGUEL cor. Calle Mabini, Vigan City, Ilocos Sur
Dau, Mabalacat, Pampanga Brgy. Saguin, San Fernando City Norberto St., San Miguel, Bulacan Tel No.: (077) 674-0300
Tel. Nos.: (045) 892-2216 Pampanga Tel. No.: (044) 764-0162 Melvin R. Aguinaldo
624-0167 Tel. Nos.: (045) 861-1066 Fax No.: (044) 764-0826
Editha C. Gomez 435-6055 Perlito U. Dimla
Regina S. Dayrit SOUTH LUZON
DOLORES SAN NARCISO
STCI Building, MacArthur Highway PLARIDEL Brgy. Libertad, San Narciso, Zambales BACOOR–MOLINO
Brgy. San Agustin, San Fernando City 0226 Cagayan Valley Road Tel. No.: (047) 913-2245 Avon Building, 817 Molino Road
Pampanga Banga 1st, Plaridel, Bulacan Johnest N. Monsalud Molino III, City of Bacoor, Cavite
Tel. No.: (045) 649-3150 Tel. Nos.: (044) 795-0105 Tel Nos.: (046) 235-7542
Fax No.: 649-3724 670-1067 SAN RAFAEL 431-9906
Alex L. Serrano Cagayan Valley Mobile No.: 0917-561-5883
OLONGAPO cor. Cruz na Daan Road May G. Tan
GUAGUA City View Hotel Building San Rafael, Bulacan
Plaza Burgos, Guagua, Pampanga 25 Magsaysay Drive Tel. No.: (044) 913-7629 BACOOR–TALABA
Tel. Nos.: (045) 901-0641 New Asinan, Olongapo City Ledwina D. Villafuerte Coastal Road cor. Aguinaldo Highway
901-0966 Tel. No.: (047) 222-2504 Brgy. Talaba, City of Bacoor, Cavite
Betty L. Bacani Fax No.: (047) 222-1891 SANTIAGO–VICTORY NORTE Tel. No.: (046) 417-5940
Mobile No.: 0917-807-8509 JECO Building, Maharlika Highway Fax No.: (046) 417-5930
GUAGUA–STO NIÑO Ricardo R. Chua cor. Quezon St., Victory Norte Maria Victoria G. Baloy
Sto. Niño, Guagua, Pampanga Santiago, Isabela
Tel. No.: (045) 900-2326 ORANI Tel Nos.: (078) 305-0260 BATANGAS–P. BURGOS
Fax No.: (045) 900-0779 Brgy. Balut, Orani, Bataan 305-0252 No. 4 Burgos St., Batangas City
Betty L. Bacani Tel. Nos.: (047) 638-1282 Elizabeth K. Chua Tel. Nos.: (043) 723-1510
638-1281 723-7652
LA UNION Elsie B. Dimalanta STA. ANA Edwin R. Guevara
A.G. Zambrano Building Poblacion, Sta. Ana, Pampanga
Quezon Ave., San Fernando City ORANI–CALLE REAL Tel. No.: (045) 409-0335 BIÑAN
La Union Calle Real, Orani Bataan Lita P. Lopez Nepa Highway
Tel. No.: (072) 700-3800 Tel. Nos.: (047) 638-1130 San Vicente, Biñan City, Laguna
Fax No.: (072) 242-0414 431-1275 STA. MARIA Tel. No.: (049) 511-3638
Eloisa B. Chan Cristina T. Fermin Gen. Luna cor. De Leon St. Fax No.: (049) 429-4878
Poblacion, Sta. Maria, Bulacan Lilibeth A. Carandang
LAOAG CITY PORAC Tel. Nos.: (044) 288-2453
LC Square Building Cangatba, Porac, Pampanga 893-0587 CALAMBA
J.P. Rizal cor. M.V. Farinas St. Tel. No.: (045) 329-3188 Fax No.: (044) 641-1150 HK Building II, National Highway
Laoag City, Ilocos Norte Mobile No.: 0917-870-3305 Helen O. Cabuhat Brgy. Halang, Calamba City, Laguna
Tel. No.: (077) 234-3776 Mariano V. Garcia Jr. Tel. Nos.: (049) 306-0238
Mobile No.: 0917-816-2456 STA. RITA 306-0234
Ronald C. Tamayo SAN FERNANDO San Vicente, Sta. Rita, Pampanga Mobile No.: 0917-817-3609
Khy Trading Building Tel. Nos.: (045) 900-0658 Rodel B. Solomon
MACABEBE San Fernando–Gapan Road 434-0131
Poblacion, Macabebe, Pampanga San Fernando City, Pampanga Gloria S. Cunanan CALAMBA–CROSSING
Tel. No.: (045) 435-5507 Tel. Nos.: (045) 961-1415 AS Building, National Highway
Mobile No.: 0917-821-8102 961-1416 SUBIC cor. Sto. Domingo St., Brgy. Uno
Analyn I. Tolentino Mary Ann Jacquelyn S. Tiongson Baraca, Subic, Zambales Crossing, Calamba City, Laguna
Tel. No.: (047) 232-6104 Tel. Nos.: (049) 545-3670
MALOLOS SAN FERNANDO–BAYAN Cheryl E. Comandante 545-5310
Canlapan St., Sto. Rosario JSL Building, Consunji St. (02) 520-8808
City of Malolos, Bulacan San Fernando City, Pampanga Rodel B. Solomon
Tel. No.: (044) 794-2830 Tel. No.: (045) 280-7818 TARLAC–MAC ARTHUR
Mobile No.: 0917-835-4684 Mobile No.: 0917-584-4429 MacArthur Highway CAVITE CITY
Rosanna L. Martinez Misael M. Velasquez San Nicolas, Tarlac City 485 P. Burgos St.
Tel. No.: (045) 982-9652 Barangay 34, Caridad
MALOLOS–CATMON SAN ILDEFONSO–SAVEMORE Fax No.: (045) 982-9653 Cavite City, Cavite
Paseo Del Rosario Savemore Building Thelma Marie C. Isais Tel. No.: (046) 417-3100
Catmon, City of Malolos, Bulacan Cagayan Valley Road Rosewedi L. Baltero-Cruz
Tel. No.: (044) 791-2461 Poblacion, San Ildefonso, Bulacan TUGUEGARAO
Fax No.: (044) 662-7819 Tel. Nos.: (044) 797-0742 Metropolitan Cathedral Parish Rectory DARAGA–ALBAY
Romeo G. Esteban 797-0974 Complex, Rizal St., Tuguegarao City N & H Building, Rizal St.
Ledwina D. Villafuerte Tel. No.: (078) 844-0484 Brgy. San Roque, Daraga, Albay
MASANTOL Mario P. Allauigan Tel. Nos.: (052) 483-0706
San Nicolas, Masanto, Pampanga 204-0024 to 25
Tel. No.: (045) 435-2906 Timoteo D. De Villa Jr.
Jona C. Bernarte

China Bank 212 Annual Report 2016

CHINA BANK SAVINGS BRANCHES

DASMARIÑAS STA. ROSA CEBU–LAHUG TALISAY NEGROS–SAVEMORE

Veluz Plaza Building Sta. Rosa-Tagaytay Highway Skyrise IT Building Savemore Talisay, Mabini St.
Zone 1, Aguinaldo Highway Sta. Rosa City, Laguna Brgy. Apas, Lahug, Cebu City Zone 12, Paseo Mabini
Dasmariñas City, Cavite Tel. No.: (049) 502-9134 Tel. Nos.: (032) 236-0809 Talisay City, Negros Occidental
Tel. Nos.: (046) 416-0510 Mobile No.: 0917-510-5951 236-0810 Tel. Nos.: (034) 441-6264
416-0501 Amor F. Cajucom Theresa L. Tan 441-6267
Ma. Cecilia S. Gutierrez Jaime Javier D. Torre
STA. ROSA–BALIBAGO CEBU–MANDAUE
FILOIL–TANAUAN SUPLANG Old National Highway A. Del Rosario Ave. ZAMBOANGA–CITY MALL
FilOil Gas Station cor. Roque Lazaga St. Mantuyong, Mandaue City, Cebu City Mall, Don Alfaro St.
Brgy. Suplang, Tanauan City, Batangas Sta. Rosa City, Laguna Tel. Nos.: (032) 520-2780 Tetuan, Zamboanga City
Tel. No.: (043) 502-7144 Tel. Nos.: (049) 534-1167 422-8019 Tel. No.: (062) 955-8709
Mobile No.: 0917-863-6160 (02) 520-8448 Kristine Mae M. Diores 955-0563
Carlo C. Olmos Sonny L. Trivino Mobile No.: 0917-704-7242
CEBU–MANGO Jennifer Marie R. De Leon
IMUS–TANZANG LUMA STO. TOMAS–MAHARLIKA JSP Mango Realty Building
OLMA Building The Lifestyle Strip, Maharlika Highway Gen. Maxilom Ave.
Aguinaldo Highway San Antonio, Sto. Tomas, Batangas cor. Echavez St., Cebu City CBS OFF-BRANCH ATMs
Tanzang Luma, Imus City, Cavite Tel. Nos.: (043) 318-0582 Tel. Nos.: (032) 231-4304
Tel. Nos.: (046) 471-4715 778-3247 231-4736 ISAAC & CATALINA MEDICAL
476-0927 Myla L. Mapalad Theresa L. Tan CENTER
Fax No.: (046) 471-9413 Calero St.
Quennie V. Umil TAGAYTAY–SAVEMORE CEBU MANDAUE–BASAK Ibayo, Balanga, Bataan
Mendez Crossing West Cebu North Road
LAGUNA–STA. CRUZ Tagaytay-Nasugbu Highway Basak, Mandaue City, Cebu LA SALLE COLLEGE ANTIPOLO
E & E Building, Pedro Guevarra Ave. cor. Mendez-Tagaytay Road Tel. No.: (032) 346-6959 1985 La Salle Ave.
Sta. Cruz, Laguna Tagaytay City Fax No.: (032) 346-8814 Brgy. San Luis, Antipolo City, Rizal
Tel. No.: (049) 501-4327 Tel. Nos.: (046) 413-3871 Pia Monica C. Alturas
Roman J. Villacorta 413- 3872 MABALACAT MUNICIPAL HALL
Mobile No.: 0917-561-5334 DAVAO Delfin Drive
LIPA–CM RECTO Quennie V. Umil 8990 Corporate Center Mabalacat, Pampanga
China Bank Savings Building Quirino Ave., Davao City
C.M. Recto Ave., Lipa City UP LOS BAÑOS Tel. Nos.: (082) 321-0273 RIS COMPOUND
Tel. Nos.: (043) 756-1414 Kanluran Road, UP Los Baños Campus 321-0274 RIS Development Corporation
756-1022 College, Los Baños. Laguna Philip C. Dumlao 168 Mercado St.
Rolando E. Castillo Tel. Nos.: (02) 536-3058 Tabe, Guiguinto, Bulacan
536-3682 DAVAO–RECTO
LOS BAÑOS–CROSSING Cherry Jane O. Pampalona C. Villa Abrille Building ZAMECO COMPOUND
Lopez Ave., Batong Malake C.M. Recto Ave., Davao City ZAMECO II Head Office
Los Baños, Laguna Tel. No.: (082) 305-5808 National Road, Bgy. Magsaysay
Tel. Nos.: (049) 536-2596 VISAYAS–MINDANAO Fax No.: (082) 227-1802 Castillejos, Zambales
536-0549 Ma. Gladys B. Amancio
Cherry Jane O. Pamplona BACOLOD
SKT Saturn Building GENERAL SANTOS
LUCENA Lacson cor. Rizal St. I. Santiago Boulevard
Merchan cor. Evangelista St. Bacolod City, Negros Occidental General Santos City
Lucena City Tel. Nos. (034) 435-6983 Tel. No.: (083) 552-6329
Tel. No.: (042) 660-6964 435-7143 Maria Theresa S. Pacheco
Fax No.: (042)710-6964 Ronnie A. Vinco, Jr
Ronald De Guzman ILOILO
BACOLOD–LUZURIAGA Cua Building
NAGA Lacson cor. Luzuriaga St. Quezon St., Iloilo City
RL Building, Panganiban St. Bacolod City, Negros Occidental Tel. Nos.: (033) 336-9752
Lerma, Naga City, Camarines Sur Tel. Nos.: (034) 704-1084 336-9753
Tel. No.: (054) 472-1947 704-1089 Pamela Julianita P. Trompeta
Albert B. Tan Ronnie A. Vinco, Jr.
ILOILO–JARO
SAN PABLO–RIZAL AVENUE CAGAYAN DE ORO Lopez Jaena cor. El 98 St.
Rizal Ave. cor. A. Fule St. (former Lopez Sergio Osmeña St. Jaro, Iloilo
Jaena), San Pablo City Cogon District, Cagayan de Oro City Tel. Nos.: (033) 320-0370
Tel. No.: (049) 562-7738 Tel. Nos.: (088) 859-0169 320-0426
Simplicia Elizabeth Kalaw 859-0740; 859-0949 Elly Beth L. Amparo
852-2006; 323-1057
SAN PEDRO Ma. Socorro D. Cosme ILOILO–QUEZON
Gen - Ber Building, National Highway 132 Quezon St.
Landayan, San Pedro City, Laguna Iloilo City
Tel. Nos.: (02) 869-8221 Tel. No.: (033) 321-0940
869-8220 Pamela Julianita P. Trompeta
Catherine A. Jardiel

China Bank 213 Annual Report 2016

CHINA BANK SAVINGS BRANCHES

BUSINESS OFFICES LAOAG SALES OFFICE DepED LOAN CENTERS

LC Square Building
BAGUIO SALES OFFICE J.P. Rizal cor. M.V Farinas St. NATIONAL CAPITAL REGION
B108 Lopez Building, 2nd Floor Laoag City, Ilocos Norte BUSINESS CENTER
Session Road cor. Assumption Road Tel. No.: (077) 600-1009 GJ Building, 2nd Floor
Baguio City 385 Quezon Ave.
Tel. Nos.: (074) 422-0090 LIPA BUSINESS CENTER West Triangle, Quezon City
(02) 884-7600 locals 4231 China Bank Savings Building Tel No.: (02) 372-7926
4232 2nd Floor C.M Recto Ave. Mobile No.: 0905-558-2542
Lipa City Czar R.Tagros
BALIUAG SALES OFFICE Tel. Nos.: (043) 756-5003
Mariano Ponce Building (02) 884-7600 local 4253 REGION 1 LA UNION BUSINESS
2nd Floor Plaza Naning CENTER
Poblacion, Baliuag, Bulacan MARIKINA SALES OFFICE A.G. Zambrano Building
Tel. No.: (02) 884-7600 locals 4202 CTP Building Quezon Ave., San Fernando City
4261 3rd Floor Gil Fernando Ave. La Union
Marikina City Mobile No.: 0915-513-9452
CABANATUAN SALES OFFICE Tel. Nos.: (02) 645-9819 Saddam Abdul Gonting
Duran Building (02) 884-7600 local 4238
Burgos Ave., Cabanatuan City CORDILLERA AUTONOMOUS
Tel. No.: (02) 884-7600 local 4254 NAGA SALES OFFICE REGION BUSINESS CENTER
RL Building, 3rd Floor B108 Lopez Building
CAGAYAN DE ORO SALES OFFICE Panganiban St., Lerma, Naga City Session Road cor. Assumption Road
Sergio Osmeña St. Tel. Nos.: (054) 472-1947 Baguio City
Cogon District, Cagayan De Oro City (02) 884-7600 local 4273 Mobile No.: 0927-378-2661
Tel. No.: (0882) 272-7082 Karina Mikaela Caguioa
SAN FERNANDO PAMPANGA SALES
CEBU BUSINESS CENTER OFFICE REGION 2 TUGUEGARAO BUSINESS
JSP Plaza Building, 2nd Floor JSL Building, 3rd Floor CENTER
General Maxilom cor. Echaves St. Consunji St., San Fernando City Metropolitan Cathedral Parish
Cebu City Pampanga Rectory Complex
Tel. Nos.: (032) 232-5061; 232- 6263 Tel. Nos.: (045) 961-0005; 961-0008 Rizal St., Tuguegarao City
(02) 884-7600 locals 4207 (02) 884-7600 locals 4221 Tel. No.: (078) 375-4471
4209; 4205; 4206 4236; 4237 Mobile No.: 0917-353-6503
Rodrigo Gamayon
DAVAO BUSINESS CENTER SAN PABLO SALES OFFICE
8990 Corporate Center, 3rd Floor China Bank Savings Building, 2nd Floor REGION 3 SAN FERNANDO
Quirino Ave., Davao City Rizal Ave. cor. A. Fule St. BUSINESS CENTER
Tel. Nos.: (082) 298-4569 San Pablo City JSL Building
(02) 884-7600 local 4218 Tel. Nos.: (049) 800-3917 Consunji St., San Fernando City
(02) 884-7600 local 4204 Pampanga
GENERAL SANTOS SALES OFFICE Tel No.: (045) 280-8215
Go Chay Ching Building SANTIAGO SALES OFFICE Jonald Imana
I. Santiago Boulevard Jeco Building, Maharlika Highway
General Santos City Victory Norte, Santiago City REGION 4-A TAYTAY BUSINESS
Tel. Nos.: (083) 301-5042 Tel. No.: (02) 884-7600 local 4374 CENTER
(02) 884-7600 local 4271 C. Gonzaga Building II, 2nd Floor
VIGAN SALES OFFICE Manila East Road, Taytay, Rizal
ILOILO SALES OFFICE Agdamag Building, 2nd Floor Tel No.: (02) 633-3988
RTG Building Quezon Ave. cor. Calle Mabini Mobile No.: 0919-754-1907
Quezon St., Iloilo City Vigan City, Ilocos Sur Jeff Reguis
Tel. Nos.: (033) 337-6421; 508-3628
(02) 884-7600 local 4219 REGION 5 DARAGA BUSINESS
CENTER
IMUS SALES OFFICE N & H Building
OLMA Building, Aguinaldo Highway Rizal St., Brgy. San Roque
Tanzang Luma, Imus City, Cavite Daraga, Albay
Tel. Nos.: (046) 416-4992 Tel. No. : (052) 483-7783
(02) 884-7600 local 4268 Mobile Nos.: 0977-459-0839
0926-445-1989
LA UNION BUSINESS CENTER Charlie M. Banes
A.G Zambrano Building
Quezon Ave., San Fernando City REGION 11 DAVAO BUSINESS
La Union CENTER
Tel. Nos.: (072) 888-7477 8990 Corporate Center, 3rd Floor
(02) 884-7600 local 4227 Quirino Ave., Davao City
Mobile No.: 0977-463-4707
Gina R. dela Cruz

REGION 12 GEN. SANTOS BUSINESS

CENTER
Go Chay Ching Building
I. Santiago Boulevard
General Santos City
Tel. No. : (083) 554-0211
Mobile No.: 0907-881-5270
Joel Dondon

China Bank 214 Annual Report 2016

CHINA BANK OFF-BRANCH ATM DIRECTORY

METRO MANILA Eastwood Cybermall Medical City Resorts World Gaming Area
Eastwood Ave., Eastwood City Ortigas Ave., Pasig City Resorts World, Pasay
168 Mall Cyberpark, Bagumbayan, Quezon City
168 Mall, Sta. Elena St. SM Megamall Bldg. B Robinsons Forum Pioneer
Binondo, Manila Eastwood Mall EDSA cor. Julia Vargas St. Pioneer St. cor. EDSA
E. Rodriguez Jr. Ave., Bagumbayan Mandaluyong City Mandaluyong City
999 Mall 2 Quezon City
Recto cor. Soler St. Metro Point Mall Robinsons Galleria
Binondo, Manila Gateway Mall EDSA cor. Taft Ave., Pasay City EDSA cor. Ortigas Ave.
Cubao, Quezon City Pasig City
999 Shopping Mall Metrowalk
1002 -1062 Soler St., Brgy. 293 Glorietta 4 Bldg. C, Metrowalk Commercial Robinsons Galleria 2
Zone 28, District 3, Binondo, Manila Ayala Center, Makati City Complex, Meralco Ave., Pasig City EDSA cor. Ortigas Ave.
Pasig City
Alabang Mall Glorietta 5 Midas Hotel
Alabang Town Center, Alabang - Ayala Center, Makati City 2702 Roxas Blvd., Pasay City Robinsons Galleria 3
Zapote Road, Muntinlupa City West Wing, Robinsons Galleria
Greenbelt 3 MRT-Boni EDSA cor. Ortigas Ave., Pasig City
Alfamart Maax Makati Ave., Makati City MRT-Boni Station
Mall of Asia Annex (MAAX) Bldg. EDSA, Mandaluyong City Robinsons Place - Manila
Seaside Blvd., San Rafael, Pasay City Greenhills Theater Mall Pedro Gil cor. Adriatico St.
Greenhills, San Juan City MRT-Cubao Station Ermita, Manila
Alfamart Naga Road MRT-Cubao Station
Naga Road, Pulang Lupa 2 Jackman Emporium EDSA, Quezon City Rockwell Power Plant
Las Piñas City Jackman Emporium Department Power Plant Mall, Makati City
Store Bldg., Grace Park, Kalookan City MRT-North Ave.
Ali Mall MRT-North Ave. Station Savers Center
P. Tuazon Blvd. Jackman Plaza-Muñoz EDSA, Quezon City EDSA near cor. Taft Ave.
Araneta Center, Quezon City EDSA cor. Congressional Ave. Pasay City
Muñoz, Quezon City MRT-Shaw
Ali Mall 2 MRT-Shaw Station Shop and Ride
P. Tuazon Blvd. JGC Alabang EDSA, Mandaluyong City 248 Gen. Luis St., Novaliches
Araneta Center, Quezon City JGC Phils. Bldg., Prime St. Quezon City
Madrigal Business Park - Phase III Multinational Clubhouse
Ateneo De Manila University Ayala Alabang, Muntinlupa City Nazareth cor. Judea Sts. Shop and Ride 2
Kostka Hall, Ateneo De Manila Multinational Village 248 Gen. Luis St., Brgy. Nova Proper
University, Katipunan Ave. Katarungan Village Parañaque City Novaliches, Quezon City
Loyola Heights, Quezon City Katarungan Village Administration
Office, F. Reria cor. University Road Newport Mall Shopwise-Commonwealth
Cash and Carry Muntinlupa City Resorts World Newport City Blk. 17, Commonwealth Ave.
Filmore St., Makati City Villamor, Pasay City Don Antonio, Quezon City
Kimston Plaza
Chiang-Kai-Shek P. Victor St. cor. P. Burgos St. Nova Square Shopwise-Antipolo
Chiang Kai Shek College Guadalupe Nuevo, Makati City 689 Quirino Highway M.L. Quezon St. cor. Circumferential
1274 P. Algue, Manila Brgy. San Bartolome, Novaliches Road, San Roque, Antipolo City
Landmark-Makati Quezon City
China Bank Online Center The Landmark Bldg., Makati Ave. SM Center Las Piñas
Starbucks, China Bank Bldg. Ayala Center, Makati City One E-Com Center Alabang-Zapote Road, Las Piñas
8745 Paseo De Roxas cor. Villar St. SM Mall of Asia, Palm Coast Ave.
Makati City Landmark-Trinoma (Facing Esplanade), Pasay City SM Hypermarket-Mandaluyong
EDSA cor. Mindanao Ave. Extension 121 Shaw Blvd. cor. E. Magalona St.
Comembo Commercial Complex Pag-asa, Quezon City Rockwell Business Center Mandaluyong City
J.P. Rizal Ext. cor. Sampaguita St. Ortigas Ave., Pasig City
Comembo, Makati City Liana’s Sampaloc SM Manila
537 M. Earnshaw, Sampaloc, Manila Puregold-Blumentritt Arroceros, Manila
Commerce Center 286 Blumentrit St., Sta. Cruz, Manila
Commerce Ave., Filinvest Malabon Citisquare SM MOA Hypermarket
Ayala Alabang, Muntinlupa City C4 Road cor. Dagat-Dagatan Ave. Puregold-E. Rodriguez SM Mall of Asia, Pasay City
Malabon City Cosco Bldg., E. Rodriguez Ave.
Conrad S Maison Mall cor. G. Araneta Ave., Quezon City SM MOA Seaside Ferry Terminal
Conrad Hotel, Coral Ave. Market! Market! 1 SM Mall of Asia Seaside Blvd.
SM Mall of Asia, Pasay City Market! Market! Puregold-Lakefront Near Esplanade, Pasay City
Bonifacio Global City, Taguig City Presidio Sudvision, Lakefront
Dasmariñas Village Association Muntinlupa City SM Muntinlupa
Office Market! Market! 2 Brgy. Tunasan, National Road
1417 Campanilla St. Market! Market! Puregold Jr.-Pandacan Muntinlupa City
Dasmariñas Village, Makati City Bonifacio Global City, Taguig City West J. Zamora St., Brgy. 851
Zone 093, Pandacan, Manila SM Taytay
Eastwood City Walk 2 Market! Market! 3 Bldg. A, SM City Taytay
Eastwood City Cyberpark Market! Market! Puregold-Paso De Blas Manila East Road, Brgy. Dolores
188 E. Rodriguez Jr. Ave. Bonifacio Global City, Taguig City Paso De Blas cor. Gen. Luis St. Taytay, Rizal
Bagumbayan, Quezon City Malinta Exit, Valenzuela City

China Bank 215 Annual Report 2016

CHINA BANK OFF-BRANCH ATM DIRECTORY
Solaire Resort & Casino U.P. Town Center PROVINCIAL Allen Avenue Catbalogan
Entertainment City, Aseana Ave. Katipunan Ave., Brgy. UP Campus Allen Ave., Brgy. 04, Catbalogan City
Parañaque City Diliman, Quezon City 268 Mall
CK Bldg., Plaridel Extension Alwana
Southgate Mall UPM - PGH Sto. Rosario, Angeles City National Highway, Brgy. Cugman
EDSA cor. Pasong Tamo Extension Faculty Medical Arts Bldg. Cagayan de Oro City
Makati City PGH Compound, Taft Ave., Manila 2 Mango Ave
Solara Bldg. Angel Supermarket
St. Francis Square UST-Doctor’s Clinic General Maxilom Ave., Cebu City Luna St. cor. Burgos St.
Doña Julia Vargas Ave. UST Hospital, Vestibule and Brgy. Quirino, Solano, Nueva Viscaya
cor. Bank Drive, Ortigas Center New Doctor’s Clinic, España, Manila A. Bonifacio-McDonald’s Baguio
Mandaluyong City Villanueva Bldg., Bonifacio St. Angeles University Foundation
UST Hospital Baguio City McArthur Highway
St. Jude College UST Hospital, España St., Manila cor. San Pablo St., Angeles City
Dimasalang St. cor. Don Quijote St. Abreeza Mall
Sampaloc, Manila UST Hospital 3 J.P. Laurel Ave., Bajada, Davao City Araullo University
UST Hospital Clinical Division Maharlika Highway
St. Luke’s-Quezon City A.H. Lacson Ave., Sampaloc Adventist University of the Bitas, Cabanatuan City
St. Luke’s Medical Center Manila Philippines
Medical Arts Bldg. Sta. Rosa-Tagaytay Road Ateneo de Davao
E. Rodriguez Sr. Blvd., Quezon City Victory Central Mall Puting Kahoy, Silang, Cavite City Roxas Ave., Davao City
No. 717 Old Victory Compound
St. Luke’s-The Fort Rizal Ave., Monumento AG&P Avenue Hotel Bacolod
St. Luke’s Medical Center, 5th Ave. Caloocan City San Roque, Bauan, Batangas 12th St. cor. Lacson St., Bacolod City
The Fort, Taguig City
Victory Pasay Mall Alfamart Filinvest Tanza Budget Wise Supermarket
St. Luke’s-The Fort 2 Libertad cor. Taft Ave. Filinvest Ave., Westwood Place Subd. Veterans Ave., Zamboanga City
St. Luke’s Medical Center, 5th Ave. Pasay City Ph.2, Brgy. Paradahan, Tanza
The Fort, Taguig City Cavite City Caltex-SLEX 1
Wack Wack Golf & Country Club SLEX - Northbound
STI - Delos Santos Medical Center Shaw Blvd., Mandaluyong City Alfamart Golden City Brgy. San Antonio, San Pedro, Laguna
201 E. Rodriguez Sr. Blvd. Molino-Paliparan Rd.
Brgy. Damayang Lagi, Quezon City Walter Mart-Makati Dasmariñas, Cavite Camayan Resort
790 Chino Roces Ave. Camayan Beach Resort & Hotel
Taft-U.N. cor. Antonio Arnaiz, Makati City Alfamart Ilang-Ilang Tanza Camayan Wharf, West Ilanin Forest
Times Plaza, T.M. Kalaw Ilang-ilang St., De Roman Subd. Area, Subic Bay Freeport Zone
cor. Gen. Luna St., Manila Walter Mart-North EDSA Daang Amaya 1, Tanza, Cavite
Walter Mart Bldg., EDSA, Quezon City CB Mall
The A Venue Alfamart Lancaster McArthur Highway, Nancayasan
Valdez Site, The A Venue Walter Mart-Sucat MCS Bldg., Advincula Ave. Urdaneta City, Pangasinan
7829 Makati Ave., Makati City Brgy. San Isidro, Dr. A. Santos Ave. Alapan II-A, Imus, Cavite
Sucat, Parañaque City CDO Medical Center
Tiendesitas Alfamart L’Paseo Arcade Indang CDO Medical Center Bldg. 2
Frontera Verde, Ortigas Ave. Zabarte Town Center L’Paseo Arcade, Poblacion Tiano cor. Nacalaban St.
cor. C-5, Pasig City 588 Camarin Road Indang, Cavite Cagayan de Oro City
cor. Zabarte Road, Caloocan City
Trinoma Off 1 Alfamart Lumina Cebu Doctors’ Hospital
Trinoma, North Ave. Aguinaldo Highway Osmeña Blvd., Cebu City
cor. EDSA, Quezon City cor. Nueno Ave., Imus, Cavite
Cebu Doctors’ University
Trinoma Off 2 Alfamart Pacita Complex 1 Potenciano Larrazabal Ave.
Trinoma, North Ave. Phase 3A, Block 3, Pacita Complex North Reclamation Area
cor. EDSA, Quezon City San Pedro, Laguna Mandaue City

Two Shopping Center Alfamart Poblacion Rosario Celebes Coconut Butuan

Taft Ave. near cor. EDSA 153 Gen. Trias Drive, Rosario P-4, Brgy. Banza, Butuan City
Pasay City Brgy. Poblacion, Cavite
Centrio Mall
Alfamart Trece Martires C.M. Recto cor. Corrales St.
CPC Bldg., Hugo Perez Cagayan de Oro
Trece Martires, Cavite
Clark Gateway
Alfamart Villa Catalina Dasmariñas Clark Gateway Commercial Complex
Lot 6123, San Agustin Velasquez St., San Francisco
Dasmariñas, Cavite Mabalacat, Pampanga

Alfamart Yakal Silang Cavite Corpus Christi

137 Pedro Montoya St. Corpus Christi School, Tomas Saco St.
cor. Yakal, San Miguel, Silang, Cavite Macasandig, Cagayan de Oro City

China Bank 216 Annual Report 2016

CHINA BANK OFF-BRANCH ATM DIRECTORY
Davao Adventist Hospital Gaisano-Puerto Lorma Hospital Nepo Mall-Dagupan
Km. 7 McArthur Highway Sayre Highway, Puerto Lorma Hospital, San Fernando City Arellano St., Dagupan City
Bangkal, Davao City Cagayan de Oro City La Union
Northside Doctors Hospital
Davao Metro Shuttle Galeria Victoria Lotus Central Mall Bantay, Vigan, Ilocos Sur
Pereyras Terminal 1, Magugpo West J.P. Rizal St., Balanga, Bataan Nueno Ave., Imus, Cavite
Tagum City Notre Dame Hospital
Good Samaritan Hospital MAAP Notre Dame de Chartres Hospital
Dipolog Center Mall Burgos Ave., Cabanatuan City Kamaya Point Road, Mariveles, Bataan No. 25 General Luna Rd., Baguio City
138 Rizal Ave., Dipolog City
Grosvenor Square Mactan Marina Mall Nueva Ecija Doctors
DIPSSCOR Josefa St., Angeles City MEPZ 1, Lapu-Lapu City Nueva Ecija Doctors Hospital
DIPSSCOR Bldg., International Port of Maharlika Highway, Cabanatuan City
Davao, Sasa Wharf, Km10, Sasa Holy Angel University 2 Magic Mall Nueva Ecija
Davao City Holy Angel University Student’s Center Alexander St., Poblacion
Sto. Rosario St., Angeles City Urdaneta City, Pangasinan Nuvali Solenad 2
DLSU-Dasmariñas Pampanga Solenad 2 Nuvali, Sta. Rosa-Tagaytay
College of Engineering, DLSU Magic Starmall Road, Sta. Rosa, Laguna
Dasmariñas, Cavite Jenra Mall Romulo Blvd., Brgy. Cut-Cut 1
Jenra Grand Mall, Sto. Rosario St. Tarlac City Nuvali Solenad 3 Bldg. B
DLSU-Health Science Campus Angeles City, Pampanga Bldg. B, Solenad 3 Nuvali, Sta. Rosa-
De La Salle University Health Malolos Tagaytay Road, Sta. Rosa, Laguna
Campus, Inc., Congressional Rd. Jollibee Mabalacat Graceland Mall, BSU Grounds
Dasmariñas, Cavite McArthur Highway McArthur Highway, Guinhawa Nuvali Solenad Hawkers Market
Brgy. San Francisco Malolos City, Bulacan Hawkers Market, Solenad 3 Nuvali
DLSU-MAC Mabalacat City, Pampanga Sta. Rosa-Tagaytay Road, Sta. Rosa
MAC Building, DLSU Medical Center Malta Hospital Toril Laguna
Compound, Congressional Rd. KCC Mall-General Santos McArthur Highway, Toril, Davao
Dasmariñas, Cavite J. Catolico Sr. Ave. Ocean Adventure
General Santos City, South Cotabato Maria Reyna Hospital Camayan Wharf, West Ilanin Forest
Eagle Ridge Country Club T.J. Hayes St., Cagayan De Oro Area, Subic Bay Freeport Zone
Club House, Brgy. Javalera KCC Mall de Zamboanga
Gen. Trias, Cavite Gov. Camins, Camino Nuevo Mariton Grocery Orchard Golf and Country Club
Zamboanga City Buntun, Tuguegarao City Gate 2, The Orchard Golf and
ECCO Building Cagayan Valley Country Club, Aguinaldo Highway
Fil-Am Friendship Highway KMSCI Dasmariñas, Cavite
Brgy. Anunas, Angeles City, Pampanga Kidapawan Medical Specialist Mariton Grocery Don Domingo
Center, Inc., Sudapin, Kidapawan City Don Domingo, Tuguegarao City OSPA-Farmers’ Medical Center
Friendship Supermarket Munoz NE Ormoc Sugarcane Planters Association
T. Delos Santos St., Science City of La Nueva-Minglanilla Market City - Farmers Medical Center
Muñoz, Nueva Ecija La Nueva Supermart, Poblacion Market City Bldg., Bus Terminal Ormoc City, Leyte
Minglanilla, Cebu Agora, Cagayan de Oro City
Gaisano-Bulua Our Lady of the Pillar
Bulua St., Cagayan de Oro City La Nueva Supermart Marquee Mall 1 Tamsui Ave., Bayan Luma, Imus, Cavite
G.Y. Dela Serna St. Don Bonifacio Rd., Angeles City
Gaisano-Iligan Lapu-Lapu, Cebu City Pampanga Pacific Mall
Gaisano Citi Super Mall Landco Business Park, F. Imperial St.
Roxas Ave., Iligan City LB Supermarket-Zamboanga Matina Town Square cor. Circumferential Road, Legazpi City
Veteran’s Ave. Extension Strip Bldg., Matina Town Center
Gaisano-Lapu-Lapu City Zamboanga City McArthur Highway, Matina, Davao Pacific Mall 2
Gaisano Mactan Mall Pacific Mall Bldg., Landco Business
Pusok, Lapu-Lapu City, Cebu LCC Peñaranda MCIA-Domestic Check-In Area Park, F. Imperial St., Legazpi City
LCC Supermarket, Peñaranda Airport Rd., Lapu-Lapu City, Cebu
Gaisano Mall-Bajada Davao cor. Rizal St., Legazpi City Pangasinan Medical Center
Gaisano Mall of Davao MCIA-Domestic Departure hall Nable St., Dagupan City, Pangasinan
J.P. Laurel Ave., Bajada, Davao City Lee Hypermarket Airport Rd., Lapu-Lapu City, Cebu
Valencia Rd., Bagacay Pavilion Mall
Gaisano Mall-Cagayan de Oro Dumaguete City, Negros Oriental Mindanao Sanitarium and Hospital Bldg. A, Pavilion Mall, Km. 35
Atrium Gaisano Mall, Corrales Tibanga Highway, Iligan City Brgy. San Antonio, Biñan, Laguna
Extension cor. C.M. Recto Ave. Lee Super Plaza
Cagayan de Oro City M. Perdices cor. San Jose St. MJS Hospital PLT College
Dumaguete City, Negros Oriental Montilla Blvd., Butuan City PLT Bldg., Dumlao Blvd.
Gaisano Mall-Talisay Bayombong, Nueva Vizcaya
Gaisano Fiesta Mall, Tabunok Lim Ket Kai Mall Nagaland E-Mall
Talisay, Cebu City Lim Ket Kai Drive P. Diaz cor. Elias Angeles Sts. Porta Vaga Mall
Cagayan de Oro City San Francisco, Naga City Along Session Road, Baguio City
Gaisano-Masbate Benguet
Quezon St., Crossing, Masbate City Lopue’s East Center Nepo Mall-Angeles
Burgos St. cor. Carlos Hilado National Doña Teresa Ave. cor. St. Joseph St.
Highway, Bacolod City Nepo Mart Complex, Angeles City

China Bank 217 Annual Report 2016

CHINA BANK OFF-BRANCH ATM DIRECTORY
Prince Mall of Baybay SM City Batangas SOCSARGEN County Hospital Waltermart-Calamba
Andres Bonifacio & Manuel L. Quezon Pallocan West, Batangas City Bula-Lagao Road cor. L. Arradaza St. Walter Mart Center, Real St.
Sts., Baybay City, Leyte General Santos City Brgy. Real, Calamba, Laguna
SM City Batangas 2
Puregold - Dau Pallocan West, Batangas City South Town Centre Talisay Waltermart-Carmona
Cosco Bldg., McArthur Highway South Gate Mall, Tabunok Macaria Business Center, Governor’s
Dau, Mabalacat, Pampanga SM City Cabanatuan Talisay, Cebu Drive, Mabuhay, Carmona, Cavite
Maharlika Highway, Cabanatuan
Quickmart Daraga Southway Mall Waltermart-Dasmariñas
Rizal St., Daraga, Albay SM City Cagayan De Oro cor. Gov. Lim, Purisima and Barrio Burol Aguinaldo Highway
Masterson Ave. Magno Sts., Zamboanga City Dasmariñas, Cavite
Robinsons Calasiao SM City Cagayan de Oro
San Miguel, Calasiao, Pangasinan Sta. Rosa Hospital Waltermart-Gen. Trias
SM City Calamba 1 RSBS Blvd., Balibago Governor’s Drive, Gen. Trias, Cavite
Robinsons General Santos National Rd., Brgy. Real City of Sta. Rosa, Laguna
Jose Catolico Sr. Ave. Calamba City, Laguna Waltermart-San Fernando
Lagao, General Santos City Super Metro Carcar Brgy. San Agustin, McArthur Highway
SM City Calamba 2 N. Bacalso Ave., Carcar City, Cebu San Fernando, Pampanga
Robinsons Tagum National Rd., Brgy. Real
National Highway, Brgy. Magugpo Calamba City, Laguna Target Mall 1 Waltermart-Sta. Rosa 1
Tagum, Davao del Norte Sta. Rosa Commercial Complex Waltermart Center
SM City Calamba 3 Brgy. Balibago, Sta. Rosa, Laguna Balibago Rd., Sta. Rosa, Laguna
Royce Hotel National Rd., Brgy. Real
Manuel Roxas St. Calamba City, Laguna Target Mall 2 Waltermart-Sta. Rosa 2
cor. Ninoy Aquino Ave., CSEZ Sta. Rosa Commercial Complex Waltermart Center
SM City Cauayan Brgy. Balibago, Sta. Rosa, Laguna Balibago Rd., Sta. Rosa, Laguna
RPGMC Tuguegarao San Fermin, Cauayan, Isabela
Enrile Blvd., Carig, Tuguegarao City The District Dasmariñas Waltermart-Sta. Rosa Bel Air
Cagayan SM City Clark Molino-Paliparan Road Sta. Rosa-Tagaytay Rd.
M. Roxas St., CSEZ Dasmariñas, Cavite Laguna Bel Air, Sta. Rosa, Laguna
SAMULCO Angeles City, Pampanga
Sta. Ana Multi Purpose Cooperative The District Imus Waltermart-Tagaytay
Bldg. 1, Monteverde St., Davao City SM City Dasmariñas 2 Aguinaldo Highway cor. Daang Hari Silang Junction Road, Tagaytay -
Governor’s Drive, Brgy. Sampalok Road, Brgy. Anabu II-D, Imus, Cavite Nasugbu Highway
San Fernandino Hospital Dasmariñas, Cavite
MacArthur Highway, Dolores Union Christian College Waltermart-Tanauan
San Fernando City, Pampanga SM City Davao Widdoes St., Brgy. II J. P. Laurel National Highway
Quimpo Blvd., Ecoland Subd. San Fernando City, La Union Brgy. Darasa, Tanauan, Batangas City
Save Wise-Pozorrubio Brgy. Matina, Davao City
Savewise Bldg., Caballero St. University of Baguio Wesleyan University
Brgy. Cablong, Pozorrubio, Pangasinan SM City General Santos Assumption Road Wesleyan University of the Philippines
cor. Santiago Blvd. & Baguio City, Benguet Mabini Ext., Cabanatuan City
Shopwise-Cebu San Miguel St., Brgy. Lagao Nueva Ecija
N. Bacalso Ave., Basak General Santos City, South Cotabato University of Bohol
San Nicolas, Cebu City Along Ma. Clara St., Tagbilaran City WNU STI University
SM City Lipa Burgos cor. Hilado Sts., Bacolod City
Shopwise-San Pedro Ayala Highway, Lipa City University of Perpertual Help - Negros Occidental
Along National Highway Biñan
Brgy. Landayan, Pacita, San Pedro SM City Marilao Doctor Jose Tamayo Medical Bldg. Xavier University
MacArthur Highway, Marilao, Bulacan University of Perpetual Help Biñan Library Annex, Xavier University
Skyrise Realty Brgy. Sto. Niño, Biñan, Laguna Corrales Ave., Cagayan De Oro City
Skyrise IT Bldg., Gorordo Ave. SM City Tarlac Misamis Oriental
cor. N. Escario St., Cebu City McArthur Highway University of San Carlos
San Roque, Tarlac City University Bldg., P. del Rosario St. Yubenco Starmall
SM City Bacolod Cebu City Yubengco Starmall, MCLL Highway
Bldg. A, SM City Bacolod SM Lanang Premier Putik, Zamboanga City
Reclamation Area, Bacolod City J.P. Laurel Ave., Brgy. San Antonio, USJR Basak Cebu
Agdao District, Davao City University of San Jose-Recoletos Basak Yu-Yu Café & Dessert Shop Tagum
SM City Baguio N. Bacalso Ave., Basak Pardo National Highway cor. Quirante II St.
Luneta Hill, Upper Session Road SM Marketmall Cebu City Magugpo, Poblacion, Tagum City
Baguio City, Benguet Congressional Ave., Dasmariñas
Bagong Bayan, Dasmariñas, Cavite Waltermart-Cabanatuan Zamboanga Peninsula Medical
SM City Baliwag Brgy. Dicarma, Maharlika Highway Center
DRT Highway, Brgy. Pagala SM Supercenter Molino Cabanatuan, Nueva Ecija MCLL Putik Highway
Baliwag, Bulacan Molino Rd., Brgy. Molino 4 Putik, Zamboanga City
Bacoor, Cavite

China Bank 218 Annual Report 2016

BUSINESS OFFICES

CONSUMER BANKING CENTERS

CBG BACOLOD CENTER CBG CAGAYAN DE ORO CENTER CBG DAVAO CENTER
China Bank - Bacolod Araneta China Bank - Cagayan de Oro-Lapasan Branch China Bank - Davao-Recto Branch
2/F CBC Bldg., Araneta St. 2/F CBC Bldg., C.M. Recto Ave. 2/F CBC Bldg., C.M. Recto
Bacolod City Lapasan, Cagayan de Oro cor. J. Rizal Sts., Davao City
Tel. No.: (034) 435-0250 Tel. Nos.: (08822) 72-81-95 / (088) 856-1326 Tel. Nos.: (082) 226-2103/ (082) 221-4163
Fax No.: (034) 435-0647 Fax Nos.: (088) 856-2409 / (088) 856-1325 (082) 222-5761
Email: [email protected] Email: [email protected] Fax No.: (082) 222-5021
Center Head: Jasmin Mae E. De Las Alas Center Head: Rhea D. Matela Email: [email protected]
Center Head: Renato C. Sanchez II
CBG BATANGAS CENTER CBG CEBU CENTER
China Bank - Batangas City Branch China Bank - Cebu Business Branch CBG ILOILO CENTER
3/F CBC Bldg., P. Burgos St. 2/F CBC Corporate Center, Samar Loop China Bank - Iloilo-Rizal Branch
Batangas City cor. Panay Road, Cebu Business Park, Cebu City 2/F CBC Bldg., Rizal cor. Gomez Sts.
Tel. Nos.: (043) 723-7127 / 723-4294 Tel. Nos.: (032) 416-1606; (032) 346-4448 Brgy. Ortiz, Iloilo City
Fax No.: (02) 520-6161 (032) 416-1915; (032) 239-3733 Tel. Nos.: (033) 336-7918
Email: [email protected] Fax No.: (032) 346-4450 (033) 503-2845
Center Head: Evelyn G. Ricardo Email: [email protected] Fax No.: (033) 336-7909
Center Head: Kinard Hutchinson L. Tan Email: [email protected]
CBG CABANATUAN CENTER Center Head: Marvin D. Celajes
China Bank – Cabanatuan, Maharlika Branch CBG DAGUPAN CENTER
2/F CBC Bldg., Brgy. Dicarma, Maharlika Highway China Bank - Dagupan-Perez Branch CBG PAMPANGA CENTER
Cabanatuan City, Nueva Ecija Siapno Bldg., Perez Boulevard China Bank - San Fernando Branch
Tel. No.: (044) 600-1575 Dagupan City 2/F CBC Bldg., V. Tiomico St.
Fax No.: (044) 464-0099 Tel. No.: (075) 522-8471 Sto. Rosario Poblacion, San Fernando City
Email: [email protected] Fax No.: (075) 522-8472 Pampanga
Contact Person: Emilie R. Gatdula Email: [email protected] Tel. Nos.: (045) 961-5344; (045) 961-0467
Center Head: Michael B. Fernandez Fax No.: (045) 961-8351
Email: [email protected]
Center Head: Verna G. Guintu

WEALTH MANAGEMENT GROUP

MAKATI HEAD OFFICE Therese G. Escolin Karen W. Tua
15/F China Bank Building, 8745 Paseo de Roxas (02) 885-5693 (02) 885-5643
cor. Villar Sts., Makati City, Philippines [email protected] [email protected]

Angela D. Cruz Grace C. Santos Yvette O. Chua

(02) 885-5641 (02) 885-5697 (02) 885-5691
[email protected] [email protected] [email protected]

Cesaré Edwin M. Garcia Eric Von D. Baviera Josefa S. Fernandez

(02) 812-5320 (02) 885-5688 (02) 230-6985
[email protected] [email protected] [email protected]

WEALTH MANAGEMENT OFFSITE OFFICES

GREENHILLS OFFICE QUEZON CITY OFFICE BACOLOD OFFICE
14 Ortigas Ave., Greenhills 82 West Ave., Quezon City 2/F CBC Bldg., Bacolod Araneta Branch
San Juan, Metro Manila Lacson cor. San Sebastian Sts.
Jaydee Cheng-Tan Bacolod City
Ma. Victoria G. Pantaleon (02) 426-6980 / [email protected]
(02) 727-7884 / [email protected] Marie Jo J. Peornato
Ma. Luisa B. Tan (034) 431-5549 / [email protected]
BINONDO OFFICE (02) 4414685/ [email protected]
6/F China Bank Bldg., Dasmariñas CEBU OFFICE
cor. Juan Luna, Binondo, Manila ALABANG OFFICE CBC Bldg., Samar Loop cor. Panay Road
2/F Unit D CBC Bldg., Acacia Ave. Cebu Business Park, Cebu City
Irene C. Tanlimco Madrigal Business Park, Ayala Alabang
(02) 241-1452 / [email protected] Muntinlupa City Eleanor D. Rosales
(032) 415-5881; (032) 239-3740 up to 43
Genelin U. Yu Sheila V. Sarmenta-Dayao [email protected]
(02) 247-8341/ [email protected] (02) 659-2463 / [email protected]
Rosemarie T. Guingona
KALOOKAN OFFICE Claire L. Ramirez (032) 415-5881; (032) 239-3742
167 Rizal Ave. Extension, Kalookan City (02) 659-2464 / [email protected] [email protected]

Jennifer Y. Macariola SAN FERNANDO OFFICE DAVAO OFFICE

(02) 366-8669 / [email protected] 2/F V. Tiomico St., San Fernando City, Pampanga Km. 4 McArthur Highway, Matina, Davao City

Sheryl Ann C. Hokia Ma. Cristina D. Puno Mc Queen Benigno-Jamora

(02) 352-3789 / [email protected] (045) 961-0486 / [email protected] (082) 297-6268 / [email protected]

Mary Grace C. Tan

(02) 352-3789/ [email protected]

China Bank 219 Annual Report 2016

SUBSIDIARIES AND AFFILIATES

China Bank Savings, Inc. (CBS) began operations on BOARD OF DIRECTORS

September 8, 2008 following the acquisition of Manila
Bank by China Bank in 2007. Subsequent mergers with Chairman
Ricardo R. Chua
Unity Bank and Planters Development Bank have bolstered
CBS’ position as a leading thrift bank in the industry. With Vice Chair Directors
157 branches nationwide and a strong platform for retail Nancy D. Yang Alexander C. Escucha
banking, auto, housing, DepEd, and enterprise finance, Rosemarie C. Gan
CBS is able to service the growing needs of the broader President Jose Lim Osmeña Jr.
Alberto Emilio V. Ramos William C. Whang
consumer and Small and Medium Enterprise (SME) market.
Ramon R. Zamora
It is committed to promoting financial inclusiveness, and Independent Directors (resigned effective January 1, 2017)
uplifting the quality of life of consumers and entrepreneurs Roberto F. Kuan
in line with its personalized brand of service. Margarita L. San Juan Corporate Secretary
Alberto S. Yao Edgar D. Dumlao
VGP Center, 6772 Ayala Ave.
Makati City 1226, Philippines
Tel. No.: (632) 988-9555
www.cbs.com.ph

(L-R) Jose Lim Osmeña Jr., William C. Whang, Rosemarie C. Gan, Roberto F. Kuan,
Ricardo R. Chua, Alberto S. Yao, Nancy D. Yang, Ramon R. Zamora,
Alexander C. Escucha, and Alberto Emilio V. Ramos.

China Bank 220 Annual Report 2016

China Bank Capital Corporation is the investment house China Bank Securities Corporation is a wholly owned
subsidiary of China Bank. The investment house aims to subsidiary of China Bank’s investment banking arm China
provide clients with a wide range of services that include Bank Capital Corporation. The stock brokerage house enables
debt and equity capital raising and underwriting, project China Bank Capital to do Initial Public Offerings (IPOs) and
finance, mergers and acquisitions, and financial advisory list these IPO shares in the Philippine Stock Exchange. China
services to all public and private companies. China Bank Bank Group’s clients stand to benefit with access to the
Capital Corporation has acted as issue manager, arranger stock brokerage service for equities-related transactions.
and underwriter in various landmark deals.

BOARD OF DIRECTORS Directors BOARD OF DIRECTORS Independent Directors

Alberto Emilio V. Ramos Roberto F. Kuan
Chairman William C. Whang Chairman Alberto S. Yao
Ricardo R. Chua Ricardo R. Chua
Corporate Secretary
President Divine Grace F. Dagoy
Romeo D. Uyan, Jr. Vice Chairman
28F BDO Equitable Tower Romeo D. Uyan Jr. 28F BDO Equitable Tower
Independent Directors 8751 Paseo de Roxas,
8751 Paseo de Roxas,
Robert F. Kuan President Makati City
Alberto S. Yao Makati City Peter M. Mutuc
Tel. No.: (632) 885-5009 Tel. No. (632) 885-5839
Fax No.: (632) 556-6712

(L - R) Alberto Emilio V. Ramos, Roberto F. Kuan, Ricardo R. Chua,

Alberto S. Yao, William C. Whang and Romeo D. Uyan, Jr.

China Bank 221 Annual Report 2016

SUBSIDIARIES AND AFFILIATES

Manulife China Bank Life Assurance Corporation, established on Chinabank Insurance Brokers, Inc. (CIBI) is a wholly-owned
March 23, 2007, is a strategic alliance between Manulife Philippines subsidiary of the Bank established on November 3, 1998 as a full
and China Bank, providing a wide range of innovative insurance service insurance brokerage. It provides direct insurance broking
products and services to China Bank customers. The bancassurance for retail and corporate customers, with a wide and comprehensive
partnership was established to provide China Bank clients holistic range of plans for life and non-life insurance. The life insurance
life, health, and wealth solutions to meet their evolving needs. retail products include Whole Life, Endowment, Investment-Linked,
In 2014, China Bank raised its equity stake in Manulife China Bank Education, Term and Life Protection with Hospitalization and Critical
Life to 40%. Illness Cover. Under the Non-Life insurance category, programs for
residential, personal, corporate and industrial clients are available,
Robert D. Wyld with insurance coverages such as Property, Motor, Marine,
President and Chief Executive Officer Accident and Liability.

Julieta P. Guanlao
President

24/F LKG Tower, 6801 Ayala Ave. 8/F VGP Center, 6772 Ayala Ave.
Makati City 1226 Philippines Makati City 1226, Philippines
Tel. No.: (632) 884-5433 Tel. No.: (632) 885-5555
Fax No.: (632) 845-0980 VGP Center: (632) 751-6000
Customer Care Line: (632) 884-7000
E-mail : [email protected]
www.manulife-chinabank.com.ph

CBC Properties and Computer Center, Inc. (PCCI ) was created

on April 14,1982 to provide computer-related services solely to
the China Bank group. It manages the Bank’s electronic banking
and e-commerce requirements, including sourcing, developing
and maintaining software and hardware, financial systems, access
devices and networks to foster the safety and soundness of China
Bank’s technology infrastructure and keep its processing capabilities
in top shape.

Phillip M. Tan Editha N. Young

General Manager Chief Technology Officer

4/F & 15/F China Bank Building

8745 Paseo de Roxas cor. Villar St.
Makati City 1226, Philippines
Tel. Nos.: (632) 885-5555; 885-5053
885-5060; 885-5051; 885-5052
Fax No.: (632) 885-5047; 885-9458

China Bank 222 Annual Report 2016

PRODUCTS AND SERVICES

DEPOSITS & RELATED SERVICES OVERSEAS KABABAYAN SERVICES • Liability Insurance

Peso Deposits • China Bank On-Time Remittance o Comprehensive General Liability Insurance
Checking • Overseas Kababayan Savings Account o Product Liability Insurance
• ChinaCheck Plus (OKS) Account o Professional Indemnity Insurance
Savings • China Bank Money Transfer o Directors and Officers Liability Insurance
• Passbook Savings • Crime Insurance
• ATM Savings TRUST SERVICES o Money, Security & Payroll Insurance
• MoneyPlus Savings Unit Investment Trust Funds o Fidelity Insurance
• SSS Pensioner’s Account • China Bank Money Market Fund o Cyber Crime Insurance
Time • China Bank Institutional Money Market o Kidnap and Ransom Insurance
• Regular Time Deposit Fund • Bonds
• Diamond Savings • China Bank Short-Term Fund o Surety Bonds
Foreign Currency Deposits (USD, Euro • China Bank Intermediate Fixed Income § Bidders bond
and Yuan) Fund § Surety / Downpayment bond
• Savings • China Bank GS Fund § Performance bond
• Time • China Bank Balanced Fund § Warranty Bond
Manager’s/Gift Check/Demand Draft • China Bank Equity Fund § Heirs Bond
Safety Deposit Box • China Bank High Dividend Equity Fund o Fidelity Bonds
Direct Deposit Facility for US Pensioner • China Bank Dollar Fund • Employee Benefit
Night Depository Services Wealth Management o Group Personal Accident Insurance
Cash Delivery and Deposit Pick-up Services • Investment Management Arrangement o Group Life Insurance
Out-of-town Checks • Personal Management Trust o HMO
Corporate Trust Services o Travel Insurance
LOANS & CREDIT FACILITIES • Escrow Services
Corporate Loans and Commercial Loans • Employee Benefit Plan PAYMENT & SETTLEMENT SERVICES
Loan Syndication • Collecting and Paying Agency Electronic Banking Channels
Factoring Receivables • Loan / Paying Agency • China Bank Automated Teller Machine (ATM)
Special Lending Programs • China Bank TellerPhone
• BSP Rediscounting TREASURY SERVICES • China Bank Online
• Industrial Guarantee Loan Fund Peso-Denominated Government and Corporate • Cash Accept Machine
• Environmental Development Program Bond Issues • Point-Of-Sale (POS)
• Sustainable Logistics Development Dollar-Denominated Government and
• Industrial and Large Projects Corporate Bond Issues CASH MANAGEMENT SOLUTIONS
Guarantee Programs Foreign Exchange Delivery Channel
Consumer Loans • Spot, Forward and Swaps China Bank Online
• HomePlus Real Estate Loans Derivatives Liquidity Management
• Contract to Sell Financing • Interest Rate and Cross Currency Swaps Account Balance & Transaction Reporting
• AutoPlus Vehicle Loans Sure Sweep
Credit Cards INSURANCE PRODUCTS POS Cash-out
• China Bank Prime Mastercard Bancassurance Disbursement
• China Bank Platinum Mastercard • Protection Check Write Plus Manager’s Check (Outsourced)
• China Bank World Mastercard o MCBL Legacy Protect 100 Check Write Plus Corporate Check (Outsourced)
o Base Protect / Base Protect Plus Check Write Plus (Software)
INTERNATIONAL BANKING • Education Corporate Inter-Bank Fund Transfer (Corporate IBFT)
PRODUCTS & SERVICES o MCBL Invest TellerCard Payroll Crediting
Import and Export Financing • Health ChinaPay (Payroll Software)
Foreign and Domestic Commercial Letters o MCBL Health Choice Payroll Processing
of Credit • Wealth Automatic Crediting Arrangement (ACA)
Standby Letters of Credit o Platinum Invest Elite eGovernment Payments (powered by BancNet):
Collection of Clean and Documentary Bills o MCBL Enrich Max • BIR eFPS Online Tax Payments
Bank Guaranty (Shipside Bond) o MCBL Affluence Income • SSS Monthly Contribution and Loan Payment
Purchase and Sale of Foreign Exchange • Retirement • Philhealth Monthly Contribution
Travel Funds o MCBL Enrich • Pag-IBIG Monthly Contribution and Loan
Servicing of Foreign Loans and Investments o MCBL Invest Payments
Trade Inquiry • Term Insurance
Trust Receipt Facility Group Life Insurance Receivables
Correspondent Banking Services Non-Life Insurance Corporate Automatic Debit Arrangement (ADA)
• Fire Insurance Check Depot (Post-Dated Check Warehousing)
INVESTMENT BANKING SERVICES o Residential Bills Pay Plus
Debt Financing o Commercial • Over-the-Counter
• Bonds § Industrial All-Risk Insurance • ATM
• Syndicated Loan § Commercial All-Risk Insurance • Internet
• Corporate Notes § Condominium Insurance • Mobile
• Structured Loan o Trust Receipts • Phone
Equity Financing • Motor Car Insurance • BancNet Bills Pay ATM
• Initial Public Offering (Common Shares) o Individual China Debit Point-of-Sale (POS) (Powered by
• Follow On Offering (Common Shares) o Fleet Program BancNet)
• Preferred Shares • Marine Insurance Automatic Debit Arrangement (ADA)
• Convertible/Exchangeable Shares o Hull Insurance eGovernment Collection
Project Finance o Cargo Insurance • SSS Sickness / Maternity / Employee’s
Mergers & Acquisition / Financial Advisory / • Engineering Insurance Compensation (SSS SMEC)
Corporate Restructuring/ Valuation/ o Contractors All-Risk Insurance Settlement Solution
Securitization o Electronic Equipment Insurance • SCCP Broker’s Solution
o Erectors All-Risk Insurance
o Machinery Breakdown Insurance
o Equipment Floater

China Bank 223 Annual Report 2016

INVESTORS INFORMATION

ANNUAL STOCKHOLDERS’ MEETING INVESTOR INQUIRIES

May 4, 2017, Thursday, 4:00 p.m. We welcome inquiries from investors, analysts, and the financial
Penthouse, China Bank Building community. For information about the developments
8745 Paseo de Roxas cor. Villar St. at China Bank, please contact:
Makati City 1226, Philippines
Alexander C. Escucha
Senior Vice President and Head
Investor & Corporate Relations Group
SHAREHOLDER SERVICES China Banking Corporation
28/F BDO Equitable Tower
For inquiries or concerns regarding dividend payments, account
8751 Paseo de Roxas
status, change of address or lost or damaged stock certificates,
Makati City 1226, Philippines
please get in touch with:
Tel. No.: (+632) 885-5609
Email: [email protected]
Stocks and External Relations
Website: www.chinabank.ph
Office of the Corporate Secretary
China Banking Corporation
11/F China Bank Building
8745 Paseo de Roxas cor. Villar St. CUSTOMER INFORMATION
Makati City 1226, Philippines
We welcome inquiries from customers and other stakeholders.
Contact persons: Please contact:
Atty. Julius L. Danas/Atty. Angeli Anne L. Gumpal
Jaime G. Dela Cruz/Mark Timothy C. Gonzales Customer Contact Center
Customer Experience Management Division
Tel. No.: (+632) 885-5133 China Bank Tellerphone (Available 7AM-10PM daily)
Fax No.: (+632) 885-5135 Hotline # (632) 88-55-888
Email: [email protected] Domestic Toll-Free #s:
[email protected] 1-800-1888-5888 (PLDT)
[email protected] 1-800-3888-5888 (Digitel)

Stock Transfer Service, Inc. Fax No: (632) 519-0143

Unit 34-D Rufino Pacific Tower Email: [email protected]
6784 Ayala Ave.
Facebook Page:
Makati City 1226, Philippines
www.facebook.com/chinabank.ph
Contact persons: Twitter Page:
Antonio M. Laviña www.twitter.com/chinabankph
Ricardo D. Regala, Jr.
China Bank Building
Tel. Nos.: (+632) 403-2410; 403-2412; 403-9853 8745 Paseo de Roxas cor. Villar St.
Fax No.: (+632) 403-2414 Makati City 1226, Philippines

We welcome letters or all such communications on matters

pertaining to the management of the Bank, stockholders’ rights,
or any other bank-related issues of importance. Stockholders who wish
to communicate with any or all of the members of the China Bank
Board of Directors may send letters to:

Atty. Corazon I. Morando

Vice President and Corporate Secretary
China Banking Corporation
11/F China Bank Building
8745 Paseo de Roxas cor. Villar St.
Makati City 1226, Philippines
Email: [email protected]

China Bank 224 Annual Report 2016

GRI REFERENCE CLAIM
This material (China Bank 2016 Annual Report) references the specific disclosures below following aspects of the GRI
Standards, as discussed in the Environmental, Social and Governance (ESG) section of the report.

General Disclosure Series 100 Page

102-1 Name of the organization Inside front cover
102-2 Activities, brands, products, and services Inside front cover, 10 – 30, 223
102-3 Location of headquarters back cover, 219
102-4 Location of operations 198 – 219
102-5 Ownership and legal form Inside front cover, 54, 64 – 65,
(inclusion – summary of Filipino and non-Filipino holdings /the Bank’s subsidiaries and affiliates) 220 – 222
102-6 Markets served 13 – 29, 200 – 219
102-7 Scale of the organization 12,13
102-8 Information on employees and other workers 34
(inclusion – Employees by gender, by region, by age)
102-13 Membership of associations 32
102-14 Statement from senior decision maker 7
102-16 Values, principles, standards and norms of behavior Inside front cover, 44 – 45, 53-54
102-18 Governance structure 47
(note: The Governance Committee oversees the Bank’s ESG topics)
102-22 Composition of the highest governance body and its committees 49 – 52
102-23 Chair of the highest governance body 48
102-24 Nominating and selecting the highest governance body 46 – 47, 51
102-25 Conflicts of Interest 60 – 61
102-26 Role of the highest governance body in setting purpose, values, and strategy 44 – 45, 46
102-27 Collective knowledge of highest governance body 61 – 62
(note – focused on good governance)
102-28 Evaluating the highest governance body’s performance 52 – 53
102-30 Effectiveness of Risk Management process 57 – 60
(note – focused on economic risk management processes)
102-41 Collective bargaining agreements 33
Social Disclosures Series 400 Page
401-2 Benefits provided to full –time employees 33
(inclusion – life insurance, health care, disability/accident insurance, leaves including maternity/
paternity, profit sharing, right to bargaining agreement)
404-2 Programs for upgrading employee skills and transition assistance program 34
(note – focused on employee development program)
407-1 The Right to freedom of association and collective bargaining agreement 33
(inclusion – report on measures taken by the Bank to support rights to collective bargaining)
 CHINA BANKING CORPORATION
China Bank Building
8745 Paseo de Roxas corner Villar Street
Makati City 1226, Philippines

www.chinabank.ph

POST-CONSUMER RECOVERED FIBER

The cover of this China Bank Annual Report is printed on Radiance New Evolution White 280gsm. Radiance is an uncoated felt-marked paper
that captures the exrtraordinary printing definition and effects of a coated paper, certified by the Forest Stewardship Council (FSC) which
promotes environmentally appropriate, socially beneficial, and economically viable management of the world’s forest.

The main report is printed on Limited Edition Fine Smooth 90gsm, 30% Recycled waste and FSC certified fibres. Made carbon neutral,
Limited Edition Fine Smooth is produced with the use of 100% wind-generated electricity. All pulps are made elemental chlorine free helping
to reduce harmful by-products.

The Financial Statement of this report is printed on FSC certified 9 Lives Recycled Offset 100% Recycled 80gsm that is made from 100%
post consumer fiber.

China Bank A Annual Report 2016