Ladies and gentlemen, welcome to the presentation of the interim results of China Construction Bank for 2021. Next, please welcome our host. Dear shareholders, analysts, fund managers, friends from the media, ladies and gentlemen, good afternoon. We're very pleased to welcome you all to CCP's 2021 interim results announcement. And thank you very much for your continued interest and trust and support for CCP.
Because of the need for normalized pandemic prevention and control, we are conducting this meeting by telephone as well as webcast. The attendees of this conference, we have Mr. Wang Jiang, President of CCB Mr. Jijihong, Vice President Mr. Wang Hao Ms.
Zhang Ming, Vice President Mr. Chenyuan Guo, Chief Risk Officer and Mr. Zhang Yi, Chief Financial Officer. I'm Hu Changmiao, Board Secretary. The bank's 2021 interim results were officially announced to the public last Friday evening, and the presentation materials related to the results were also released on the company's official website in advance today for your reference.
Before we move on to the Q and A session, I would like to invite President, Mr. Won jiang, to briefly introduce to you the operating results of our bank for the first half of the year. Please welcome Mr. Won. Good afternoon, investors, analysts and friends from the media.
Good afternoon. First of all, I would like to extend a warm welcome to all of you on behalf of my colleagues at CCB. And I would like to express my sincere gratitude to our customers and friends from all walks of life for their long standing concern and support for the development of Construction Bank. In the face of the complex business environment and the fierce market competition in the first half of this year, CCB resolutely implemented the decision and deployment of the State Council as well as the Central Party Committee. And based on the new development stage, implemented the new development concept to build a new development pattern, deeply practiced the new financial actions and continued to promote the 3 major strategies: deepen digital management, strengthened comprehensive risk control and strongly supported the new development pattern of domestic and international dual circulation and high quality economic and social development.
At the same time, we have also achieved good business performance and improved our business development and market competitiveness. By end of June, the China Construction Bank total asset of RMB 29,800,000,000,000, an increase of 6% over the beginning of the year. We have achieved a net profit of RMB 150 4,100,000,000, an increase of 10.9 percent ROA, 1.06 percent ROE, 13.1 percent. Asset quality remains stable. Nonperforming loan ratio is 1.53 percent first half of this year.
And our strategy implementation highlights as the result of our expansion. First of all, inclusive finance continues to lead the market. CCB relies on its 1st mover advantage, further improve the digital inclusive program. The comprehensive benefits continue to highlight, and the social impact continues to expand. We have effectively achieved the organic unity of fulfilling social responsibility and commercial The bank's inclusive finance loan balance at the end of the first half of this year was RMB 1,701,000,000,000, an increase of RMB 280,840,000,000 from the beginning of the year.
CCP Huit only certified enterprises exceeded 5,560,000,000 with an accredited balance of more than RMB 700,000,000,000, creating a risk control system of full process control and at the enterprise level, maintaining stable asset quality and carrying our inclusive financial services in 14,000 outlets across the bank, realizing the effectiveness of both online and off line services. 2nd, the financial technology empowerment effect is prominent. As of the above, for our AI cumulated production and application scenario is applied in more than 500 scenarios, CCP Cloud for more than 400 projects in 9 fields to provide support, IoT platform access for millions of various business and relying on technology empowerment to enhance the service capabilities, construction bank customers, making sure their insight is sharper and more efficient. In addition, we have a more accurate marketing services and more functional risk control. At the same time, the effectiveness of CCB's financial technology to empower society is also continuing to show.
The smart service platform has 160,000,000 registered users with a cumulative business processing volume of more than 17,000,000,000 yen and providing overall system solutions for a number of banks and exporting intelligent risk control products to more than 900 small and medium sized financial institutions. Thirdly, the housing leasing social impact fund, CCB, recently implements the national policy on housing compensation sufficient for the sound development of real estate development and continues to increase its support for development of policy oriented rental housing, which has achieved good results at the moment. Citi's comprehensive service platform for housing leasing has covered 96% of the country's prefecture level as well as above administrative districts, providing transparent transaction services for 37,000,000 individual landlords and tenants. The nationwide CCB housing resident communities reached 323. Housing subsidy operates and manages more than 300,000 housing units, support more than 140 guaranteed rental housing projects in pilot cities nationwide, helps supply small low rent housing units and has a balance of RMB 105 600,000,000 in loans for public housing leasing, up RMB 22,100,000,000 from the beginning of the year.
4 Speed, the penetrating service for rural revitalization, CCB insists on combining the service strategy for rural revitalization with the penetrated services with the center of state owned banks promoting the opening of 3 major strategies in the field of agriculture, helping to consolidate and expand achievements of poverty eradication effectively, connecting with rural revitalization, promoting high quality and high efficiency of agricultural wise residents in one industry in rural areas and affluent and rich farmers' lives. By end of June, the balance of private loans of the bank was a JPY 2,310,000,000,000 increase of 4.752 percent from the beginning of the year. In addition, we have covered nearly 80% of villages nationwide. The spillover effect of green finance has deepened. CCB insists on focusing on the country's 2030, 2000 and 60 targets, set up the carbon neutral and carbon peak working group, continue to improve the top level design and organizational structure.
We continue to nurture various green industries and cultivate through green credits, green bonds, green leasing, green trust and other financial tools. By end of June, the bank's green loan balance was RMB 1,570,000,000,000, up 16.7 percent from beginning of the year, and the loan ratio of the 2 high emission industries continued to decline. 6th, the normalization of digital operation has been steadily promoted. In response to the trend of development of the digital economy. CCP continued to explore the digital business model and achieved the results of industry workers.
In the first half of the year, CCP accelerated the construction of 3 central decks around building ecology and expanding users, continued to enhance digital operation capabilities, focused on building a complete operational closed loop from ecology to finance, created CCB Live app, mobile banking and highlighted of our business and continue to improve online ecological services and operational channels. CCB, as the 1st batch of designated operators of digital RMB, steadily promotes the pilot scheme and this expansion of digital RMB in traffic, in travel, livelihood, payments, education and medical care to stimulate the use of retail and other areas, achieve the promotion of digital RMB indicators that is promoted by the PBOC, and we rank 1 in all these indicators. 1st, a solid contribution to the high quality development of the real economy, accurate support for key areas of economic development. The total amount of loans increased by RMB 1,320,000,000,000 from beginning of the year. Beijing, Tianjin, Kobe, Yangtze River Delta, Greater Bay Area.
In these three key regions. The new loans to the public sector accounted for more than half of the business. In addition, for manufacturing industry as well as emerging industries, private enterprise loans continue to increase. Diversified financing support found investment growth, RMB 281,300,000,000 Investment Banking Business to provide direct financing for enterprises more than RMB 400,000,000,000 increased support for foreign trade customers the cumulative transaction amount of paid goods over RMB 370,000,000,000 cross border express loan series products have supported nearly 10,000 customers in total 2nd, strengthen the financial needs of serving People's Good Life, build more than 340 special scenarios in the fields of leasing, pension, automotive, community, cross border, etcetera, and continue to upgrade the Cloud Studio Plus Enterprise WeChat Services system, providing more comprehensive, convenient and secure financial services for business and individual customers. And we continue to support the reasonable need of residential household living livelihoods.
Personal housing loans and consumer credit loan business continue to develop in
a healthy fashion. We continue to accelerate
the construction of a We continue to accelerate the construction of a mega wealth system, focusing on transformation and upgrading of wealth management and private banking, including the CCB and agricultural Wealth Platform and helping customers preserve and increase the value of their assets through a full range of wealth management funds, insurance, trust, etcetera. By end of June, the bank's personal customer financial assets have exceeded JPY 14,000,000,000,000. But the full implementation of corporate social responsibility and solid promotion of continuous support given to small and micro enterprises and fully supports the normalized pandemic prevention and control as well as flood control and relief, the issuance of preferential interest rate loans for related enterprises, RMB 145,000,000,000 And we have donated RMB 20,000,000 to Henan province, which is affected by the flood. For the whole bank, our 14,000 outlets remain open, the workers' harbor and continue to expand the scope of convenient life services. CCP University continue to educate our coverage of financial inclusion education to people with a total of 48,000 people receiving the training and 3 point 8 7,000,000 people benefiting from this.
In the first half of this year, CCB continued to strengthen its risk and internal control, and its asset quality was stable and improving. In addition, we have improved the comprehensive active and modernized risk control system, incorporated environmental and climate change, fraud risk and model risk into the comprehensive risk management system, continue to optimize risk control as well as enhanced digitization and intelligence and risk control capabilities. Although the functions of the risk control platform has been highlighted and the promotion of small business loans and personal loans, cloud approval has been accelerated. The risk management system and the investment transaction business has been further improved. The risk screening of financial market transaction business has been strengthened.
Post investment management of credit bonds has been optimized, and the rectification and transformation of the Wealth Management business has been carried out in an orderly manner. 2nd, the initiative to strengthen credit control nonperforming loan expectations to achieve double reduction in CCB. We have always insisted on the importance of credit risk. And for the first half of this year, the bank's nonperforming rate as well as the overdue, they have both reduced and with JPY 82,000,000,000 negative scissors price scissors and of both NPL and overdue and maintaining the best level in the industry, asset qualities continue to improve. The current global pandemic continues to evolve, and the momentum of the world economic recovery is uneven.
Although China's economy has continued to recover steadily so far this year, uncertainties in the economic operation are still prominent. In the next step, CCP will continue to adhere to the general keynote of seeking progress in a stable mansion, practice the new financial concept, promote these 3 strategies in-depth, continue to promote the normalization of digital operation, increase the construction of mega health management system, focus on improving the group's comprehensive financial services capabilities, actively fulfill its social responsibility, achieve its own high quality development in serving the development of the economy and society and giving back to the majority of the investor. Finally, I would like to thank the shareholders and analysts and media friends from all walks of life for their concern and support. Thank you very much.
Thank you, Mr. Wang. Now we will start the Q and A session. To allow more investors and friends from the media to ask the questions, we suggest that each participant ask only one question. And before you ask a question, please identify yourself and your media affiliation.
Ladies and gentlemen, we will now start the Q and A session. The first question comes from Ms. Yuwei from Xinkuan News Agency. I have a question regarding the loans under Inclusive Finance. You have the highest loan size among other banks.
The national policy is to require other banks to keep their inclusive financial loans for SMEs to be above 30%. So are you faced with any pressure of marketing and asset quality? With this pressure, will you further reduce the price of loans to benefit SMEs? Thank you. [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Thank you for the question.
As for CCB, first of all, to support SME and Inclusive Finance is our task to put into practice the decisions and the deployment of the State Council and CPC Party Central Committee. And it's also an important initiative for us to fulfill our responsibility. SMEs are really faced with problems, especially with the uncertainty of the pandemic and the disasters earlier this year. These factors combined have made it very difficult for SMEs. It inevitably has brought some impact on inclusive finance as well as the asset quality.
But it should be noted that in the first half of this year, we saw an additional 4,000,000 market players. SMEs have played a dynamic role in the economic development. So to support the development of small and micro enterprises, especially strengthen our support to inclusive finance. This is important because it brought to CACB many opportunities. As you mentioned, in the first half, we had a very high base of inclusive of finance, RMB 1,700,000,000,000.
Against that backdrop, we are faced with huge challenges in inclusive finance. In the first half, the daily average loans amounted to RMB 8,100,000,000. And every day, we need to collect RMB 6,700,000,000 loans. So with the high base to support the momentum of in close finance and to implement the decisions and deployment of CPC Central Committee and the State Council. This is inevitably a huge challenge for CCB in terms of inclusive finance.
But with years of experience, we have set up a digital strategy for inclusive finance, laying a very solid foundation for the next stage of inclusive finance. What's more, looking at the current asset quality of Inclusive Finance, the risk is under control. In the first half, the NPL ratio is 1.1%. SME's NPL ratio is under 1%. In terms of due diligence, in the very first half, the pricing of asset loans as for small and micro enterprises, it's 1.47%.
This represents our increased efforts to support small and micro enterprises and our initiative to cut fees and benefit SMEs. We will further enhance our support to SMEs in line with the policy of central government. As for our management strategies regarding financing and risk control, it should be said that currently micro and small enterprises, the price is far lower than those of our new loans. In the very first half, the pricing was 4.3% for SMEs, while overall, the average rate was 4.68%. Well, there is a issue of covering risks with benefits, but we have enjoyed the policy of targeted RRR cuts and tax benefits, so we can cover risks with benefit.
In the next stage, we will implement the central government's policy to cut fees and lower taxes. We will strengthen our efforts to support SMEs. In terms of poverty alleviation, although we are faced with huge challenges, CCB has a smart risk management system. The risk of small and micro enterprises is under control. We expect that by the end of the year, NPO ratio would not be higher than 1.5%.
It will range from 1.3% to 1.5%. Thank you again for the question. Thank you, Mr. Wang. Next question comes from Ms.
Zhou Jie from CCIC. We noticed that recently the central government has tightened the policies regarding LGFV. So will your corporate credit products be affected? And what's the key priorities for your credit products going forward? Thank you.
Mr. Wang will take the question. Thank you for the question. Recently, the central government's initiatives to tighten LGFV related finance policy is to rectify the irregular local government debt and increase the operability of tax policies. In recent years, we have conducted our credit loan business in accordance with laws and regulations.
Up to now, by the end of the first half of this year, the corporate credit products amounted to RMB6.6 trillion. Currently, our credit products have been very stable with abundant products in the pipeline. We are a huge bank in terms of infrastructure support, retail financing as well as inclusive credit loans. We have a good full play to our advantage in fundamental areas. We have enhanced our Inclusive Finance business and provide very good guarantee to small and medium enterprises.
We also support green development, smart manufacturing and other key areas by putting more credit loans. In the first half, SME loans increased by 23%, private business increased by 11.5%, green loans increased by 16.7%, all higher than corporate loans in general. In the second half, CCB will continue to enhance the adjustment of credit structure in corporate loans, and we will put an end to
substandard
credit loans to local government debts. We will give priorities to inclusive finance, advanced manufacturing, new energy, strategic new industries and rural rejuvenation, we will maintain a stable growth of credit loans with continuous optimization of credit structure. Besides to address floods and pandemic situation in some areas, we strengthened our efforts to support relevant regions and enterprises by helping them resume production and business. Thank you again for your attention. Thank you, Mr.
Wong. Next question comes from Hong Kong Commercial Daily. Please go ahead. This year, due to the pandemic, we are still meeting online and we have had this results announcement conferences for in virtual manner for 2 years. I look forward to an in person meeting next time.
This year, you have regained a 2 digit growth and you have huge increase in profitability in the Q2. What's the reason? And do you expect to maintain that momentum going forward? Thank you for the question from a friend from Hong Kong. You may have noticed that after the major banks released their business results that CCB has reached 2 digit growth.
I think there are a few reasons behind that. First of all, Chinese economy has remained stable, laying very solid foundation for the development of banking industry. China has successfully contained the pandemic and allowed enterprises and market players to resume production in the business. The fundamentals of Chinese economy has been stabilized, leading to a huge demand for credit service from banks. As we mentioned, the new credit loans were 1,320,000,000,000.
The increase in credit loans have surpassed the growth of asset. So this helps us effectively expand our NIM income and improve our profitability. As for CCB, we seriously put into practice the decisions and deployment of the CCP Central Committee and State Council, especially in our efforts to put into practice the so called new finance and the 3 major strategies, we have consolidated our traditional advantages. The first curve and value creation have been enhanced. At the same time, the second curve has gained momentum, opening a new path for the development of our bank.
In the first half, the overall interest income has risen by 5.2%. Non interest income fees and commissions have increased by 6.8%. That's why we have maintained a healthy growth of net profit. Thirdly, we have further enhanced our risk control capabilities, and we have maintained good asset quality in the first half. Impairment loss was down 2.7%.
At the same time, in the first half, we strengthened our efforts to dispose of non performing assets. The size of disposal amounted to JPY 87,000,000,000, a record high. We effectively exposed risks. So those listed as non performing loans, some of them have very good quality. So in the first half, our cash collection rate amounted to 27,000,000,000, increasing by 114%.
Disposal of non performing loans, the recoup of profit also contributed to the increase in profit. The second reason, as you know very well, is that in the first half, due to the impact of the pandemic and commercial banks have made coordinated efforts considering the pandemic. To prevent the pandemic from affecting our business, we took a prudent approach and enhanced our efforts to release credit. So the base in the first half was very low. The increase of net profit, 4.92%, was based on a low base of last year.
So that was only a high point, a cyclical high point. So this that was probably the highest point in this year. As for the whole year, we believe that this year's momentum would be making progress amid stability. And in the future, the bank's development will be in line with Chinese economy. All indicators, including financial indicators, will maintain a balanced manner.
As for the whole year, we will not reach the growth rate of 10.9%. It might not be that high, but it will be in line with the macroeconomic development, and that is expected. And I think that is realistic. Next question Next question comes from Financial Times. Please go ahead.
Good afternoon, management. Here is my question. Recently, the government tightened policies related to Internet companies. Will that bring any challenge? What differentiates CCB from other Internet companies in terms of fintech?
And what are your advantages? Ms. Jiangming will answer the question. Thank you for the question. Fintech is one of the drivers, engines that boosted our growth.
In the results press conference in March, we elaborated our fintech strategies. Mr. Wang also talked about our progress in fintech in the first half. Fintech is in itself a finance. So to serve people's welfare is the purpose of a fintech technology.
Since 2018, we have initiated our top plus FinTech strategies to extend the market. We opened a FinTech ecosystem. We have strengthened our support with technology, and we have made progress in digital operation. For example, Inclusive Finance, our Inclusive loans have been ahead of the curve for many years with very good asset quality. That also shows how we can make use of technology and digital operation to reconstruct small and micro enterprises.
The next example is smart governance. We have reached a strategic agreement with more than 100 municipalities in China in helping them building governance platforms, we have to rely on Fin Technologies, which is quickly responsive and agile. Prudent management and supervision has become the trend. That also provides us a huge opportunity in settlement and payment and other areas. We have many advantages.
First, we are always people oriented. We serve the country and serve the demands of people for better life. We have a huge customer base. 2nd, we have a huge amount of data. We can quickly respond to customers' demand and changing demand, especially in different user scenarios.
Thirdly, we have online and offline channels offering financial services in different scenarios. So we can support inclusive finance, house rental, rural rejuvenation and smart governance. At the same time, we're also relying on CCB Life as a platform. We are going deeper in life related scenarios to support the ecosystems surrounding the banks' branches. We have realized the 2021, 2025 FinTech strategies, we call it top 8, top plus 2.0 laying out the major tasks for the next 5 years.
In the future, CCB will elaborate on its strategies in FinTech. We will build ecosystems based on the new finance system. We will do a better job in enabling financial services and enabling our customers with FinTech. Thank you. Next question comes from Ms.
Gen from Taiping Asset Management. You may start your question. Thank you, management. I have a question regarding NIM. We saw that in the first half, CCB's NIM was down to some extent.
Could you please help us understand what the reasons are? And what is your outlook for NIM going forward? When will we expect to see the NIM to turn around and resume growth? Mr. Zhang Yi, our CFO will take that question.
Thank you, Ms. Ka, for the question. And thank you for your attention to our indicator of value creation. It should be said that over the last 2 years, NIM across the banking industry has been contracting. One reason is that the potential economy growth is contracting globally.
That is coupled with pandemic. Different countries have taken accommodative monetary and fiscal policies, and that is compounded by China's efforts to marketize interest rate. So that will surely lead to lower interest rate. If you look at CCB, since the start onset of the pandemic, as Mr. Cheng said, CCB strengthened its efforts to support a real economy, and we also implemented central government policies to cut fees and benefit enterprises.
So our earnings from private banks in inclusive finance has gone down and the interest cost has gone up. That's why our NIM contracted. In the first half, our NIM was 2.13%, 7 percentage points down year on year and 6 percentage points down compared with the end of last year. But you may have noticed that in Q1 and Q2, the NIM has remained at the same level. So the impact of LPR was prominent in Q1.
However, in Q2, the return of our major assets, loans, debts have remained stable, and that offset the impact from rising interest costs. Ms. Gun also asked about our outlook for NIMA going forward for the rest of this year. Personally, I think the contraction of NIMA will stabilize in the end of this year and the beginning of next year. We will strengthen effort to adjust our structure, especially in loans, deposits and risk pricing of major products.
We believe that overall in this year, our NIM will remain at a stable level.
Thank you, Mr. Zhang, and we welcome the next question. Next question comes from Mr. Zhang Shuai from CICC. Please go ahead.
Okay. Thank you, management team, for the opportunity. This is Zhang Shuai from CICC. Earlier, we have heard the discussion about NIM, and I'll continue on this line. And I can see that for Q1, actually, we have seen very good results.
And for the speed increasing and for the first half of this year, actually, the speed slowed down. And what is the reason behind this? And I would also like to ask in terms of the whole year increase of the income, what is your outlook and expectation? Thank you. Well, I'll have Mr.
Zhang Yi, our CFO, to answer this question. Thank you, Mr. Zhang, for your question. Yes, indeed. For our Intermediary business, and this reflects a bank's capability of serving their customers as well as their capability.
And for CCD, we continue to pay attention to intermediate for first half of this year. We have realized intermediary business of KRW 69 1,000,000,000 and up by 8% compared with Q1. This is down by 2 percentage points. So overall speaking, the trajectory is still at a very healthy level. And actually, for Intermediary Business and for the whole year, if we look at the data and for Q1, because there is the Chinese New Year.
And we know that Chinese New Year, this is a peak season for people to carry out their investment in various activities. So for the whole of the first half of this year, with respect to some of our payment business and trust business, we continue to see fast growth in terms of wealth management products because of the transformation in this regard. And we continue to see the improvement in this regard. And we have also seen the growth speed by 6.8%. And for the whole year, for intermediate trade business, I think that we would be able to keep it growing at a healthy level because you can see that for our Intermediary Business.
On one hand, it is on the payment and settlement and they account for over half of the business of Intermediary Business segment. And this is based on our very rich and diversified customer base, especially in recent years. And we have seen a large scale of fintech empowerment, and this is the area whereby it's very stable. And secondly, for our large scale Asset Management business, in addition, we have also built the CCB Jirong brand. And in addition with the FinTech business, it has enabled us to empower our customers.
And this part of business is also very stable. And the thirdly, for our corporate business as well as a comprehensive business, including, for instance, the building of the supply chain platform and for our business, and we have the upstream and downstream. So this you would see that, for instance, undertaking business and bond business, etcetera, securitization business and all these capabilities are improving and which, therefore, helps us with the payment settlement business. And therefore, for the whole year growth, I'm very positive and confident. Thank you.
Thank you, Mr. Zheng. Next question comes from taijin. Please start your question. For the disposal of existing assets and the issuance of new asset management products, can you please elaborate on that?
Mr. Wu, our Vice President, will take the question. Thank you for the question. The Asset Management Services Reform is a topic of great interest. I believe it improves commercial banks' healthy development.
We have been actively pushing forward the transformation of the asset Wealth Management product. As for the progress of the disposal of existing assets, it's up to expectation, even higher than expected. In the first half, KRW 11.23 trillion fixed interest of products increasing by 241 percent, non standard product over
JPY 160,000,000,000.
I believe the on balance sheet asset is still under control with good asset quality and provision is in line with on balance sheet assets. Process of transformation, we've been actively setting up a new system for Asset Management Systems, including different lines of works from research to asset management. In the first half, Wealth Management products have recorded an income of JPY 9,100,000,000, increasing by 6 0.8%. Our subsidiary of Wealth Management, since its opening 2 years ago, have seen fast growth of asset size with stronger capabilities stronger profitability. By the end of first half, they have managed over 700 products, all in accordance with the new rules.
And the total size is over JPY 960,000,000,000, increasing by JPY 240,000,000,000 in the first half. The net profit is JPY 530,000,000. Going forward, we will work closely with regulators and move forward with the disposal of existing assets in orderly manner. And also in the 14th 5 year period, our bank has listed big wealth management as our major strategies. We will continue to pull in the good resources of the wealth management products, so we can make sure that our products complement each other in a more diversified portfolio.
We will strengthen our capability of individual investments, and we will satisfy our customers' demands for investments in the Wealth Management in all around. We will take full efforts to protect investors individual investors. So we'll create more value for customers. We will help customers realize the preservation and appreciation.
Thank you, Mr. Zhihong, for your reply. Next question, please. Next question comes from UBS, Ms. Yanmeijin.
Please go ahead. Thank you for giving me this opportunity. This is Yanmei Jun from UBS. I would like to ask one question with respect to asset quality. And we noticed that for CCP asset quality for first half of this year, we see that it is very stable or actually improving in terms of NPL as well as overall NPL, special mention loans, etcetera, it is all decreasing.
In addition, we also noticed that mainly due to the recovery of the pandemic as well as the support from the government. So for instance, once these policies, they expire and once these policies exit and will this cause the decreasing of the asset quality, we also see that for first half of this year, for example, rental as well as the property business, their NPL has increased. So can I please ask the management team to help us understand about the second half of the year of the asset quality trajectory as well as the provision, etcetera? Thank you. Thanks for your question.
We'll have our CRO, Chief Risk Officer, Mr. Chen Yang Guo, to answer this question. Thank you, Ms. Yan, for your question. At the moment, people pay great attention to the impact of the pandemic on asset quality.
During the pandemic, with respect to the policies that was implemented as well as the pandemic recovery and control, we have seen that it has really improved the society's economy, etcetera. And in addition for CCB, we have implemented all the requirements by CDRC and continue to optimize our structure and to enhance anti cycle regulation as well as the prudent running of the business. For the first half of this year, we have realized NPL and overdue loans, both a reduction for NPL, 1.06 percent compared with the beginning of the year, down by 3 bps. And for overdue loans, 0.8%, down by 1 bps. In terms of the quality, we can see that we have a solid foundation.
In terms of coverage ratio, it's 222.39%, up by 8.8%, overall speaking. In terms of the impact of these policies on our asset quality is limited. It's because for all these requirements from the regulators, we have always adhered to them and always implemented them, and we have divided them very strictly. In addition, we have not had this impact, our risk categorization. For last year, we have already done work in the control of risk and through the differentiation as well as enhancing the disposal work that we carry out.
And we believe that in terms of the risk, we have already released a lot of them. And for this year, we'll continue to work on this basis and continue to enhance the asset quality. And for the next step, we will work hard on the stabilization of the quality as well as the prevention of risk and continue to be very prudent with respect to the international environment and to carry out our risk prevention work well. And for the second half of this year, and we still continue to see risks and uncertainties, and we need to see that for China. We can see that our economy is a recovery, and we're seeing very good momentum.
In addition, our asset quality is very good. In terms of our capability of shortening risks, it's still very stable. Thank you.
Thank you. And next question. The next question comes from Guangha Securities. I'm from Guangha Securities. I have a question regarding deposits.
In the first half, your bank saw an 8% increase in deposits. And why is that? What measures did you take to boost that growth? Recently, we have observed some new policies regarding deposit mechanism. Can you please elaborate on your outlook for the reform of deposit related policies?
Mr. Zheng Yi, our CFO, will take the question. Thank you, Mr. Liu, for the question. In the first half, TCB worked very well in deposits with an increase of 8.3%.
The first half faced with the contraction of the marginal effect of the monetary policies. Our bank has taken a lot of measures to expand the deposits. I believe it all comes down to our customer base. In the first half, as you can see, our corporate customers have exceeded 7,500,000 and accounts have exceeded 9,000,000. Individual customers have exceeded 700,000,000.
Through digital transformation. We continue to build new user scenarios and an ecosystem. In the first half, corporate, individual, retail and institutional customers have all seen very stable growth. Secondly, we were able to see the opportunities from the stable macroeconomic growth, And we focused on key sectors, key customers and key areas where the money flows into. So we worked on these areas, and we were able to maintain a stable level of debt ratio.
In the first half, as you can see, we have maintained the balance of different types of deposits, and we have strengthened our coordination between the types of deposits and their duration. In the second quarter, we have done a very good job in controlling the interest paying rate of our deposits, meeting our expectation. In the first half, the total deposits are RMB 22,300,000,000,000. Our domestic personal loans deposit increased by 9.7%. Interest paying ratio in Q2 is very stable, recording a 1.67% growth compared with the Q1.
You've also asked about the reform of pricing strategies. And now the policy is to add percentage points on the benchmark interest rate. 2nd, the upper limit of benchmark rates have been adjusted. The interest rates at the long end are increasing while decreasing at the shorter end. So I believe this is reasonable, and we can maintain a reasonable and healthy competitive environment, and this will help us optimize the structure of deposit duration, and this is in line with the national policy to control interest paying ratio of a deposit.
So as for the whole year, I believe the interest paying out ratio will be stable for the whole
Your next question, please. Next question from Wu Yuen coming from Xinhua News. Please go ahead. Thank you, management team. This is Wu Yu from Xinhua Agency, and I pay attention to Green financing.
I'd like to ask what about your green financing development for first half of this year. We can see that the regulators will continue to strengthen the development of green financing. And which areas would you work harder on this area in the second half of this year? Thank you. We'll have Mr.
Jiju Hong to take this question. Thank you. Thank you for your attention given to this very important issue. In September 2020, in the United Nations Conference, Mr. Xi Jinping has announced the carbon neutral target in China, and this shows that our commitment to the development of carbon neutral and carbon deduction.
CCB as a major bank, we are very dedicated to implementing all the policies of the government. And in recent years, with respect to the implementation of Green Finance, and we have done a lot of exploration work in this regard. In addition, we have also achieved quite great results. We will continue to enhance the development of Green Finance to help our country to realize the dual carbon targets. And in terms of the 14 to 5 year plan for our bank, we have further clarified this in our pathways and in the following areas.
We will be doing well in our work. And first of all, we will continue to strengthen the overall architecture for the Board as well as the management team with respect to their overall management and coordination will further enhance it. As we have heard, we have established the Carbon Peak and Carbon Neutral Task Force Committee. And we will also we also have implemented and come up with the action plan and to really guide us in this area of work. Secondly, we continue to enrich our green financing products.
We have innovated to come up with saving energy loans, green loans, etcetera. And based on our very diversified advantages in the bond area, we continue to have a green rental, green financing, green trust, etcetera, for various green products in the system. In addition, in total, we have launched a JPY 2,400,000,000 loans, green loans as well as the transformation loans. We have undertaken for the first batch of carbon neutral loans as well as development loans by end of the first half of this year for green loans. We have JPY 1,500,000,000,000 and up by 16.7%.
In addition, we continue to see the improvement in its mix. And in addition, with respect to the strengthening in terms of the resource allocation, assessment as well as flowchart, etcetera. And we have a very targeted plan and to continue to work on the transformation of Green Finance and the low carbon. We continue to support new energy as well as Green Industries development and continue to enhance the management of these high emission industries, and we hope that these high emission industries will continue to see their carbon reduction being reduced. In addition, we continue
to put
the environmental risks into our portfolio, and we continue to monitor the process and to manage the relevant customers. And we pay great attention to the consumption of energies as well as carbon emission as well as its impact on the manufacturing environment in terms of the credit rating of companies for environment as well as the risks. We'll have a more diversified assessment in terms of the approval process, and we have a veto mechanism. And we have enhanced on the management of environmental risks and to enhance our capability of screening the clients and to launch as well as work with relevant departments to push forward the assessment for climate risks. And thank you, Jihong, for your answering, and let's welcome the next question.
Question comes from Ms. Zhao from the Banking and Insurance Newspaper. Good afternoon. Thank you for taking my question. China has for the tourist battle against the poverty.
So as a bank, how do you solidify your achievement in poverty alleviation and serve the national strategy to renovate rural areas. And Mr. Wang, the Vice President will take the question. Thank you for the question. CCB has paid very high attention to poverty alleviation.
With China's achievement in lifting its population out of poverty, to solidify the achievement of poverty alleviation and move forward with the national strategy to invigorate the rural development, we will help rural areas work on key areas from food security to agriculture missionary. We will continue to strengthen our support to those areas that were just out of poverty and we will solidify the achievement of poverty alleviation. It's combination with agriculture renovation. By the end of the first half, we have launched a large number of branches, Yoonongtong covering 80% of the villages in China, offering financial services to over 10,000,000 rural villagers. And by using e commerce, we help grassroots government do their governance work properly.
And we have launched both online and offline rural services platform. And we also set up smart governance platforms. We offered over 600 items of online services. By the end of the first half, the platform has granted RMB 2,100,000,000 online loans. 3rd, we will strengthen our efforts to grant social inclusive loans.
We will make sure that we support rural development with its agricultural products and infrastructure. By the end of the first half, our loans balance was RMB 2,310,000,000,000. We will use the Internet Plus and Big Data to enable our rural and social inclusive finance services. So we have a whole range of online loan products. We will combine financial and non financial resources dairy industry in Mongolia, in Pu'rut industry in Kinmen, we have started our exploration.
Going forward, with the new finance concept, we will enable more open platform and convenient user scenarios to explore the potential in this big industry. Thank you.
Next question, please. Ms. Diane Xu from China Securities Paper. Thank you. Good afternoon.
Thank you for this question. I'd like to ask with respect to the requirement of mortgages from the regulator and how big of an impact do we have and how would the CCP cope with this? Well, thank you, Ms. Dai, for your question. We'll have our CRO, Mr.
Chen, to answer the question. Thank you, Ms. Dai, for your question. Since this year, for CCB, we continue to adhere to the policies of stabilizing the land price as well as the housing price and the houses are for living, not for speculation and to participate very strictly with all these policies. And with respect to mortgages, we have seen the mortgages has grown in a stable fashion.
And in terms of its percentage in the total loan size, it has continued to reduce for the first half of this year. It is KRW 6,100,000,000,000, and it has grown by 7% compared to beginning of the year and from the short term. And I believe that this will affect the newly increased mortgages portion of CCB. However, because we have already planned for enough of a buffer time period and for the overall impact on this year, it is something that is controllable. And for the long term, it is the new regulations can help the property market to become more optimized and to make sure the relevant business can grow at a healthy fashion.
And the next step, we'll continue to launch our mortgage services in orderly fashion and to continue to help the growth of this part of the business. In the meantime, in terms of personal loans and credit card business, we'll continue to work hard and utilize the advantage of the fintech to further enhance our scenario planning and in addition to help us with our growth of the retail loans. In addition, CCB utilizing our traditional mortgage advantages, and we continue to launch the leasing business, and we have seen very good results in the society. And in terms of our rental business, we have covered 96% of all the local county level cities and the locations, and we continue to support about 140 projects. In terms of public leasing business, we already have reached JPY 160 1,000,000,000 in the meantime.
We can also see in terms of customer acquisition as well as monthly active users, we'll continue to see our capabilities improving in this regard. Thank you.
Next question comes from Goldman Sachs. Thank you, management, for taking my question. My question is regarding capital adequacy ratio or CAR. Your CAR decreased compared with the beginning of the year. Will you issue more financial instruments to replenish assets to boost your CAR ratio or CAR ratio?
And what's the output for your CAR ratio for the rest of the year? Dan, our CFO, will take the question. As we know, KAR is the benchmark for a bank regarding its ability to fend off risks. We've paid a high attention to our CAI ratio. In the first half, our CAR ratio was 16.5%, down 8% compared with the beginning of the year.
I believe this is a low point, relatively speaking as for the whole year. In the first half, net asset is up 3.31 percent due to our dividend payout of JPY 81.5 1,000,000,000. I believe we have included in our consolidated balance sheet in the first half. In terms of weighted risk assets, in the first half, weighted risk asset is up 6.27 percent because we have sped off our granting of loans. Loans and advances have increased by 7.9% for the first half.
So that was the result of our strategy to grant loans and make profit as early as possible. So I believe CAR reached a low level in the first half and we'll expect a rebound in the second half. Among major banks in China, CCB is ahead of the curve in terms of CAR ratio. Our CAR ratio has been very robust. We have been committed to both intrinsic capital accumulation and external capital replenishment.
So we've been consolidating our intrinsic capability of asset creation, and we will with intrinsic asset replenishment, and that will be coupled by external asset replenishment. For example, in early August, we issued a secondary capital bond worth of KRW 80,000,000,000, which received very good feedback. And through transformation of asset related strategies. We will push forward the development of light assets business so we can improve our management of the car ratio and other indicators.
Thank you. Due to time constraint, we'll have the last question. Next question, please. Our next question comes from Mr. Fan Hai Shu from CSA.
Please go ahead. Thank you, management team, for giving me the opportunity. I'd like to ask with respect to the digital currency. And we know that on the 16th July, the Central Bank has published a white paper and they talked about the development framework. I noticed that the CCB is also the 1st batch of banks that have participated in the pilot scheme and how has the progress been in this pilot scheme?
Thank you, Mr. Fang, for your interest in digital currency. And for this question, we would like to invite Ms. Jiangming, our Vice President, to answer this question. Thank you, Mr.
Fan. And yes, indeed, digital currency
in terms of our payment system, it is
a great meaningful. It Fiat currency status. In addition, it also meets the demand of the convenience of the convenience that is required by the customers. And you can see that in the white paper, it has also mentioned that for CTB actually starting from 2017 under the unified organization of the PBOC, we have participated in this work already, and we have done 3 areas of work. And the first one is to iterate the digital currency work in CCB as well as e wallet to facilitate the flow of digital currency.
And second, we also adhere to the principle of stable and security and safe, etcetera. So in last year, we have already started our pilot scheme and number 3, and we have worked hard on some of the innovation work in terms of smart transactions as well as its transactions with the hard wallets. And this is to provide the community and society with a more convenient way of making payments. And so far, in terms of the digital wallet, and we already have about 7,000,000 individual wallet as well, 120 corporate wallets and totaling about 1,800,000,000 yen transaction in total. And we can see that it is already covering every aspect of our life in terms of dining services, the transport as well as a lot of smart businesses.
So going forward for the next step and for CCB, we will continue to follow PBOC's guidance, especially with
our advantage in terms of services to our
customers as well as FinTech. We'll continue to carry out our research in the area of FinTech as well as the digital currency. And we'll continue to make our support and contribution in the regard of the development of digital currency. Thank you, Mr. Fan, for your question.
I would like to thank Mr. Zhang for your question. And in the early stage, we have already made the announcement for our presentation of our interim result announcement. And we have also collected all the questions that investors were interested in. And at this time, we have also opened up the online webinar.
And we have compared these questions that we have collected and versus the questions that were posed. And I believe that most of these investors' questions online, we have covered them all. And if you have any further questions, we welcome you all to get in touch with us either by e mail or by telephone and we will try our best to respond to your questions as soon as possible. The management team just now have already shared and had an in-depth communication with everyone, and we hope that we would be able to help everyone to better understand the strategic moves that CCD is carrying out as well as our development of our business if you have any further questions. We welcome you all to get in touch with our IR department or our office.
And I would like to thank you again for the attention and care you give to CCB. I also wish you all great health and smooth work. And this is the end of the interim result announcement of CCB. Thank you very much.