Guolian Securities : CIRCULAR OF ANNUAL GENERAL MEETING FOR THE YEAR 2020

March 31, 2021 at 01:50 pm IST

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Guolian Securities Co., Ltd., you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

(a joint stock limited company established in the People's Republic of China with limited liability)

(Stock Code: 01456)

WORK REPORT OF THE BOARD OF DIRECTORS FOR THE YEAR 2020

WORK REPORT OF THE SUPERVISORY COMMITTEE FOR THE YEAR 2020

ANNUAL REPORT FOR THE YEAR 2020

FINAL ACCOUNTS REPORT FOR THE YEAR 2020

PROFIT DISTRIBUTION PLAN FOR THE YEAR 2020

RESOLUTION ON THE REMUNERATION DISTRIBUTION OF DIRECTORS FOR THE YEAR 2020 RESOLUTION ON THE REMUNERATION DISTRIBUTION OF SUPERVISORS FOR THE YEAR 2020 RESOLUTION ON THE RE-APPOINTMENT OF AUDIT INSTITUTIONS OF

THE COMPANY FOR THE YEAR 2021

RESOLUTION ON THE PROPRIETARY BUSINESS SCALE OF

THE COMPANY FOR THE YEAR 2021

RESOLUTION ON THE ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS OF

THE COMPANY FOR THE YEAR 2021

RESOLUTION ON THE CHANGE OF SUPERVISOR OF THE COMPANY

DUTY REPORT OF THE INDEPENDENT DIRECTORS FOR THE YEAR 2020

AND

NOTICE OF AGM

Notice convening the AGM of Guolian Securities Co., Ltd. to be held at the conference room at 4th Floor, No. 8 Jinrong One Street, Wuxi, Jiangsu Province, the PRC, on Friday, 7 May 2021 at 1:00 p.m. is set out on pages 12 to 14 of this circular.

If you intend to appoint a proxy to attend the AGM, please complete and return the enclosed form of proxy in accordance with the instructions printed thereon. In case of H Shareholders, the proxy form shall be lodged with the Company's H Shares registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, as soon as possible, but in any event, not less than 24 hours before the time scheduled for holding the AGM. Completion and delivery of the proxy form will not preclude you from attending and voting in person at the AGM if you so wish.

1 April 2021

		CONTENTS
			Page
DEFINITIONS .	. .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
NOTICE OF AGM	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
APPENDIX I	-	WORK REPORT OF THE SUPERVISORY COMMITTEE
		FOR THE YEAR 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	15
APPENDIX II	-	FINAL ACCOUNTS REPORT FOR THE YEAR 2020 . . . . . . . . . . .	23
APPENDIX III	-	ESTIMATED ORDINARY RELATED PARTY
		TRANSACTIONS OF THE COMPANY FOR THE YEAR 2021	29
APPENDIX IV	-	DUTY REPORT OF THE INDEPENDENT
		DIRECTORS FOR THE YEAR 2020 . . . . . . . . . . . . . . . . . . . . . . .	36

- i -

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions have the following meanings:

"AGM"		the annual general meeting of the Company to be held at
			the conference room at 4th Floor, No. 8 Jinrong One Street,
			Wuxi, Jiangsu Province, the PRC on Friday, 7 May 2021 at
			1:00 p.m.
"Articles of Association"	the articles of association of the Company
"Board" or	the board of Directors of the Company
	"Board of Directors"
"Chairman"	the chairman of the Board
"	Company	"	Guolian Securities Co., Ltd.（國聯證券股份有限公司）,

a joint stock company established in the PRC with limited liability, the H Shares of which are listed on the main board of the Stock Exchange (stock code: 01456) and the A Shares of which are listed on the Shanghai Stock Exchange (stock code: 601456)

"Company Law"

"CSRC"

"Director(s)"

"A Share(s)"

the Company Law of the People's Republic of China

China Securities Regulatory Commission

the director(s) of the Company

ordinary share(s) in the share capital of the Company with a nominal value of RMB1.00 each, which is (are) listed on Shanghai Stock Exchange

"A Shareholder(s)"

"Group"

"Guolian Group"

holder(s) of A Shares

the Company and its subsidiaries

Wuxi Guolian Development (Group) Co., Ltd（. 無錫市國聯發展（集團）有限公司）

- 1 -

	DEFINITIONS

"H Share(s)"	overseas listed foreign share(s) in the share capital of the
	Company with a nominal value of RMB1.00 each, which is
	(are) listed on the Stock Exchange and traded in HK dollars

H Shareholder(s)"
HK dollars"
Hong Kong"
Latest Practicable Date"

holder(s) of H Share(s)

Hong Kong dollars, the lawful currency of Hong Kong

the Hong Kong Special Administrative Region of the PRC

26 March 2021, being the latest practicable date prior to the printing of this circular for ascertaining certain information in this circular

"Listing Rules"	the Rules Governing the Listing of Securities on The Stock
	Exchange of Hong Kong Limited, as amended from time to
	time
"PRC" or "China"	the People's Republic of China, but for the purposes
	of this circular, excluding Hong Kong, Macau Special
	Administrative Region and Taiwan region
"Share(s)"	ordinary share(s) in the share capital of the Company with a
	nominal value of RMB1.00 each, including A Share(s) and
	H Share(s)
"Shareholder(s)"	holder(s) of the Share(s)
"RMB" or "Renminbi"	Renminbi, the lawful currency of the PRC
"Securities Law"	the Securities Law of the People's Republic of China
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Supervisor(s)"	the supervisor(s) of the Company
"Supervisory Committee"	the supervisory committee of the Company

In case of any discrepancy between the Chinese version and the English version of this circular, the Chinese version shall prevail.

- 2 -

LETTER FROM THE BOARD

(a joint stock limited company established in the People's Republic of China with limited liability)

	(Stock Code: 01456)
Executive Director:	Registered Address in the PRC:
Mr. Ge Xiaobo	No. 8 Jinrong One Street
Non-executive Directors:	Wuxi, Jiangsu Province
the PRC
Mr. Yao Zhiyong (Chairman)
Mr. Hua Weirong	Headquarters/Principal Place of
Mr. Zhou Weiping	Business in the PRC:
Mr. Liu Hailin	No. 8 Jinrong One Street
Mr. Zhang Weigang	Wuxi, Jiangsu Province
Independent Non-executive Directors:	the PRC

Mr. Lu Yuanzhu	Principal Place of
Mr. Wu Xingyu	Business in Hong Kong:
Mr. Chu, Howard Ho Hwa	40/F, Dah Sing Financial Centre
	248 Queen's Road East
	Wanchai
	Hong Kong
	1 April 2021
To the Shareholders
Dear Sir or Madam,

WORK REPORT OF THE BOARD OF DIRECTORS FOR THE YEAR 2020

WORK REPORT OF THE SUPERVISORY COMMITTEE FOR THE YEAR 2020

ANNUAL REPORT FOR THE YEAR 2020

FINAL ACCOUNTS REPORT FOR THE YEAR 2020

PROFIT DISTRIBUTION PLAN FOR THE YEAR 2020

THE COMPANY FOR THE YEAR 2021

RESOLUTION ON THE PROPRIETARY BUSINESS SCALE OF

THE COMPANY FOR THE YEAR 2021

RESOLUTION ON THE ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS OF

THE COMPANY FOR THE YEAR 2021

RESOLUTION ON THE CHANGE OF SUPERVISOR OF THE COMPANY

DUTY REPORT OF THE INDEPENDENT DIRECTORS FOR THE YEAR 2020

AND

NOTICE OF AGM

INTRODUCTION

Notice convening the AGM of the Company to be held at the conference room at 4th Floor, No. 8 Jinrong One Street, Wuxi, Jiangsu Province, the PRC, on Friday, 7 May 2021 at 1:00 p.m. is set out on pages 12 to 14 of this circular.

- 3 -

LETTER FROM THE BOARD

The purpose of this circular is to give you the notice of the AGM and provide you with relevant resolution details to enable you to make informed decision on whether to vote for or against the resolutions to be proposed at the AGM for the following, to be approved by way of ordinary resolution(s):

ORDINARY RESOLUTIONS

Work report of the Board of Directors for the year 2020;
Work report of the Supervisory Committee for the year 2020;
Annual report for the year 2020;
Final accounts report for the year 2020;
Profit distribution plan for the year 2020;
Resolution on the remuneration distribution of Directors for the year 2020;
Resolution on the remuneration distribution of Supervisors for the year 2020;
Resolution on the re-appointment of audit institutions of the Company for the year 2021;
Resolution on the proprietary business scale of the Company for the year 2021;
Resolution on the estimated ordinary related party transactions of the Company for the year 2021;

10.01 Estimated related party transactions with Wuxi Guolian Development (Group) Co., Ltd. and its related enterprises

10.02 Estimated related party transactions with other related legal persons and related natural persons
Resolution on the change of Supervisor of the Company; and

TO RECEIVE AND REVIEW

Duty report of the independent Directors for the year 2020.

- 4 -

LETTER FROM THE BOARD

ORDINARY RESOLUTIONS

Work report of the Board of Directors for the year 2020

An ordinary resolution will be proposed at the AGM to consider and approve the work report of the Board of Directors for the year 2020, the text of which is set out in the Company's results announcement published on the website of the Company and the HKEXnews website of the Stock Exchange on 18 March 2021.

Work report of the Supervisory Committee for the year 2020

An ordinary resolution will be proposed at the AGM to consider and approve the work report of the Supervisory Committee for the year 2020, the text of which is set out in Appendix I to this circular.

Annual report for the year 2020

An ordinary resolution will be proposed at the AGM to consider and approve the annual report for the year 2020, the text of which is set out in the Company's results announcement published on the website of the Company and the HKEXnews website of the Stock Exchange on 18 March 2021.

Final accounts report for the year 2020

An ordinary resolution will be proposed at the AGM to consider and approve the final accounts report for the year 2020, the text of which is set out in Appendix II to this circular.

Profit distribution plan for the year 2020

An ordinary resolution will be proposed at the AGM to consider and approve the profit distribution plan for the year 2020, the text of which is as follows:

The audited net profit of the Company in 2020 was RMB567,921,692.65. According to the relevant requirements of the Company Law, Securities Law, Financial Rules for Financial Enterprises and Articles of Association, after appropriating statutory provident fund and general risk reserve, totaling RMB171,943,377.24, the profit available for distribution for the year amounted to RMB395,978,315.41. The balance of the undistributed profit was RMB1,940,345,146.32 in previous year and the accumulated undistributed profit for this year was RMB2,336,323,461.73.

- 5 -

LETTER FROM THE BOARD

Considering comprehensive factors including the long-term development of the Company and the interests of the Shareholders, the Company proposed the profit distribution plan for 2020 as follows: A cash dividend of RMB1.2 (tax inclusive) per 10 shares will be distributed. By using the total number of shares of 2,378,119,000 as at the end of 2020 as a base factor, the total amount of cash dividend is RMB285,374,280.00, and the undistributed profit of RMB2,050,949,181.73 will be carried forward to next year. The Company will distribute cash dividend to H Shareholders whose names appear on the register of members of the Company as at close of business on Thursday, 20 May 2021.

Upon the approval of the above profit distribution plan at the AGM, such profit distribution is expected to be paid to the Shareholders of the Company before 6 July 2021.

The cash dividend will be denominated and declared in RMB, and payable in RMB to A Shareholders and in HK dollars to H Shareholders respectively. The actual amount to be distributed in HK dollars will be converted based on the central parity rate of RMB to HK dollars as announced by the People's Bank of China on the first business day after the date of the AGM.

According to the Notice on the Management of Personal Income Tax Impose after the

Abolition of Guo Shui Fa [1993] No. 045 Document issued by the State Administration of Taxation (Guo Shui Han [2011] No. 348)（《國家稅務總局關於國稅發[1993]045號文件廢止後有關個人所得稅征管問題的通知》（國稅函[2011]348號））, the dividend received by foreign resident individual shareholders from the issuance of shares in Hong Kong by domestic non-foreign invested

enterprises is subject to the payment of individual income tax according to the items of "interests, dividend and bonus income", which shall be withheld by the withholding agents according to relevant laws. The foreign resident individual shareholders who hold the shares issued by domestic non-foreign invested enterprises in Hong Kong are entitled to the relevant agreed treatment pursuant to the provisions in the tax agreements signed between the countries where they reside and China or the tax arrangements between Mainland and Hong Kong (Macau). The tax rate for dividends under the relevant tax agreements and tax arrangements is generally 10%, and for the purpose of simplifying tax administration, domestic non-foreign invested enterprises issuing shares in Hong Kong may, when distributing dividends, generally withhold individual income tax at the rate of 10%, and are not obligated to file an application. If the tax rate for dividends is not equal to 10%, the following provisions shall apply: (1) for citizens from countries which have entered into tax agreements/arrangements stipulating a tax rate of lower than 10%, the withholding agents will file applications on their behalf to seek entitlement of the relevant agreed preferential treatments, and upon approval by the tax authorities, the excess tax amounts withheld will be refunded; (2) for citizens from countries which have entered into tax agreements/arrangements stipulating a tax rate of higher than 10% but lower than 20%, the withholding agents will withhold the individual income tax at the agreed-upon effective tax rate when distributing dividends, and are not obligated to file an application; (3) for citizens from countries without tax agreements or are under other situations, the withholding agents will withhold the individual income tax at a tax rate of 20% when distributing dividends.

- 6 -

LETTER FROM THE BOARD

According to the requirements of the Notice on the Withholding Corporate Income Tax on

the Dividends Distributed by the Chinese Resident Enterprise to Foreign H Shares Non-residentEnterprise Shareholders (Guo Shui Han [2008] No. 897)（《關於中國居民企業向境外H股非居民企業股東派發股息代扣代繳企業所得稅有關問題的通知》（國稅函[2008]897號）) issued by the SAT, when the Chinese resident enterprises distribute dividends of 2008 and subsequent years

to foreign H Shares non-resident enterprise shareholders, they shall pay the withholding enterprise income tax at the unified rate of 10%.

Pursuant to provisions in the Notice on Tax Policy Regarding Shanghai-Hong Kong Stock

Connect Pilot Programs Issued by the Ministry of Finance, the SAT and CSRC (Cai Shui [2014] No. 81)（《財政部國家稅務總局證監會關於滬港股票市場交易互聯互通機制試點有關稅收政策的通知》（財稅[2014]81號））and the Notice on Tax Policy Regarding Shenzhen-HongKong Stock Connect Pilot Programs (Cai Shui [2016] No.127)（《關於深港股票市場交易互聯互通機制試點有關稅收政策的通知》（財稅[2016]127號））, for the dividends obtained by mainland individual investors from investing in H Shares listed in HK Stock Exchange through Shanghai-

Hong Kong Stock Connect or Shenzhen-Hong Kong Stock Connect, such H-share companies shall withhold individual income tax at the tax rate of 20%. For the dividends obtained by mainland securities investment funds by investing in shares listed in HK Stock Exchange through Shanghai- Hong Kong Stock Connect or Shenzhen-Hong Kong Stock Connect, the individual income tax will be levied pursuant to the provisions mentioned above. For the dividends obtained by mainland enterprise investors from investing in shares listed in HK Stock Exchange through Shanghai-Hong Kong Stock Connect or Shenzhen-Hong Kong Stock Connect, such H-share companies shall not withhold and pay any income taxes on the dividends, as the income taxes shall be reported and paid by the investing enterprises on their own. Meanwhile, for the dividends obtained by mainland resident enterprises from holding relevant H Shares for consecutive 12 months, the corporate income taxes shall be exempted according to laws.

Pursuant to the current practices of Inland Revenue Department of Hong Kong, no withholding taxes shall be levied for the dividends distributed by the Company.

Resolution on the remuneration distribution of Directors for the year 2020

An ordinary resolution will be proposed at the AGM to consider and approve the remuneration of Directors for the year 2020, the text of which is set out in the Company's results announcement published on the website of the Company and the HKEXnews website of the Stock Exchange on 18 March 2021.

- 7 -

LETTER FROM THE BOARD

Resolution on the remuneration distribution of Supervisors for the year 2020

An ordinary resolution will be proposed at the AGM to consider and approve the remuneration of Supervisors for the year 2020, the text of which is set out in the Company's results announcement published on the website of the Company and the HKEXnews website of the Stock Exchange on 18 March 2021.

Resolution on the re-appointment of audit institutions of the Company for the year 2021

An ordinary resolution will be proposed at the AGM to consider and approve the reappointment of Deloitte Touche Tohmatsu and Deloitte Touche Tohmatsu Certified Public Accountants LLP as international auditor and domestic auditor of the Company, respectively, for the year 2021 and to hold office until the conclusion of the next AGM of the Company. Their respective audit expense will be separately determined by the management of the Company under the authorisation.

Resolution on the proprietary business scale of the Company for the year 2021

An ordinary resolution will be proposed at the AGM to consider and approve the proprietary business scale for the year 2021.

To strengthen the Company's management on overall risk and guarantee the stable and sound operation of various businesses, in accordance with market conditions, the development strategies of the Company, risk preferences and relevant regulatory requirements, the 16th meeting of the fourth session of the Board considered and approved the proprietary business scale of the Company for the year 2021, which is subject to consideration at the AGM, the proposals are as follows:

Proprietary equity securities and their derivatives ≤ net capital x 70%
Proprietary non-equity securities and their derivatives ≤ net capital x 300%

- 8 -

LETTER FROM THE BOARD

Resolution on the estimated ordinary related party transactions of the Company for the year 2021

Ordinary resolutions will be proposed at the AGM to consider and approve the following estimated ordinary related party transactions for the year 2021:

10.01 Estimated related party transactions with Wuxi Guolian Development (Group) Co., Ltd. and its related enterprises

10.02 Estimated related party transactions with other related legal persons and related natural persons

The Company, in accordance with the requirements of relevant laws and regulations, the Listing Rules of the Shanghai Stock Exchange, the Guidelines of the Shanghai Stock Exchange on Related Party Transactions of Listed Companies and the Management Measures of the Related Party (Connected) Transactions of the Company, has made projections about its ordinary related party transactions to be conducted in 2021 during the course of business operation based on the need of its daily operations and business development. For details, please refer to Appendix III of this circular.

Resolution on the change of Supervisor of the Company

An ordinary resolution will be proposed at the AGM to consider and approve the change of Supervisor of the Company.

At the meeting held on 18 March 2021, the Supervisory Committee considered and approved the resolution on the nomination of Mr. Xu Faliang ("Mr. Xu") as the candidate for Supervisor of the fourth session of the Supervisory Committee of the Company. Upon the approval at the general meeting, Mr. Jiang Zhiqiang will cease to serve as a Supervisor and the chairman of the fourth session of Supervisory Committee of the Company.

Mr. Xu has the qualifications to serve as a Supervisor of the Company, and his term of office will commerce from the date of approval at the AGM and will end till the expiration of term of the fourth session of the Supervisory Committee.

- 9 -

LETTER FROM THE BOARD

The biographical details of Mr. Xu are as follows:

Mr. Xu Faliang（徐法良）, born in 1964, Chinese nationality with no right of permanent residency abroad, holds a bachelor's degree. He is currently the secretary of the discipline inspection committee and the chairman of the labour union of the Company. He once served as the financial manager, deputy general manager and general manager of the Securities Branches of the Company, the general manager of the Auditing Department and chief compliance officer of the Company, the chairman of the supervisory committee of Guolian Futures Co., Ltd., the chief compliance officer of Hua Ying Securities Co., Ltd..

As at the Latest Practicable Date, save as disclosed above, Mr. Xu confirmed that (i) he has no relationship with any other Directors, Supervisors, senior management, substantial Shareholders or controlling Shareholders (as defined under the Listing Rules) of the Company; (ii) he does not hold any other positions within the Company or other members of the Group; (iii) he did not hold any directorship in any other listed companies, the securities of which are listed on any securities market in Hong Kong or overseas in the last three years;

he has no interest or deemed interest in any Share or underlying Share of the Company or its associated corporations within the meaning of Part XV of the SFO; (v) there are no other matters relating to his appointment that need to be brought to the attention of the Shareholders or the Stock Exchange or to be disclosed pursuant to Rule 13.51(2)(h) to (v) of the Listing Rules.

Upon formal appointment, Mr. Xu will enter into a service contract with the Company, and Mr. Xu will receive remuneration in accordance with the remuneration assessment system of the Company, including salary, performance bonus and benefits. The salary before tax of Mr. Xu is RMB720,000 per year, and the performance bonus will be determined based on the Company's operation conditions and his work performance and will be submitted to the general meeting for approval. After confirmation, the Company will make a disclosure. For details, please refer to the annual report and relevant announcements and circulars published by the Company in due course.

TO RECEIVE AND REVIEW

Duty report of the independent Directors for the year 2020

Duty report of the independent Directors for the year 2020 will be submitted to the AGM for Shareholders' review but no Shareholders' approval is required. The text of the report is set out in Appendix IV to this circular.

- 10 -

LETTER FROM THE BOARD

AGM

The AGM will be held at the conference room at 4th Floor, No. 8 Jinrong One Street, Wuxi, Jiangsu Province, the PRC at 1:00 p.m. on Friday, 7 May 2021 to consider and approve, if thought fit, the resolutions on the matters set out in the notice of the AGM, which are set out on pages 12 to 14 of this circular.

If you intend to appoint an agent to attend and/or vote at the AGM, you are requested to complete and return the form of proxy in accordance with the instruction printed thereon not later than 1:00 p.m. on Thursday, 6 May 2021 (Hong Kong time).

Completion and return of the form of proxy will not preclude you from attending and voting in person at the AGM should you so wish.

VOTING BY POLL

Pursuant to Rule 13.39(4) of the Listing Rules, any vote of Shareholders at the AGM must be taken by poll. As such, the chairman of the AGM will exercise his power under the Articles of Association to demand a poll for all resolutions proposed at the AGM. Results of the poll voting will be published on the website of the Company and the HKEXnews website of the Stock Exchange after the AGM.

As at the Latest Practicable Date, to the best knowledge of the Company, Wuxi Guolian Development (Group) Co., Ltd., Guolian Trust Co., Ltd., Wuxi Guolian Municipal Electric Power Co., Ltd., Wuxi Minsheng Investment Co., Ltd., Wuxi Cotton Textile Group Co., Ltd. and Wuxi Huaguang Environmental & Energy Group Co., Ltd. had abstained from voting on resolution 10.01. Jiangsu Xinfang Industrial Co., Ltd., Wuxi Weifu High-technology Co.,Ltd. and Wuxi Municipal Xinfa Group Limited had abstained from voting on resolution 10.02. Save as disclosed above, no others Shareholders are considered to be required to abstain from voting on the relevant resolutions at the AGM.

RECOMMENDATION

The Board considers that all resolutions proposed at the AGM are in the interests of the Company and its Shareholders as a whole. As such, the Board recommends the Shareholders to vote in favor of the resolutions proposed at the AGM.

Yours Faithfully,

By order of the Board

Guolian Securities Co., Ltd.

Yao Zhiyong

Chairman

Wuxi, Jiangsu Province, the PRC

- 11 -

NOTICE OF AGM

(a joint stock limited company established in the People's Republic of China with limited liability)

(Stock Code: 01456)

NOTICE OF 2020 ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the 2020 annual general meeting (the "AGM") of Guolian Securities Co., Ltd. (the "Company") will be held at the conference room at 4th Floor, No. 8 Jinrong One Street, Wuxi, Jiangsu Province, the PRC on Friday, 7 May 2021 at 1:00 p.m. to consider and, if thought fit, to pass the following resolutions of the Company. Capitalized terms used herein shall have the same meanings as those defined in the circular of the Company dated 1 April 2021 unless the context otherwise requires:

ORDINARY RESOLUTIONS

Work report of the Board of Directors for the year 2020;
Work report of the Supervisory Committee for the year 2020;
Annual report for the year 2020;
Final accounts report for the year 2020;
Profit distribution plan for the year 2020;
Resolution on the remuneration distribution of Directors for the year 2020;
Resolution on the remuneration distribution of Supervisors for the year 2020;
Resolution on the re-appointment of audit institutions of the Company for the year 2021;
Resolution on the proprietary business scale of the Company for the year 2021;
Resolution on the estimated ordinary related party transactions of the Company for the year 2021;
10.01 Estimated related party transactions with Wuxi Guolian Development (Group) Co., Ltd. and its related enterprises

- 12 -

NOTICE OF AGM

10.02 Estimated related party transactions with other related legal persons and related natural persons

11. Resolution on the change of Supervisor of the Company; and

TO RECEIVE THE RELEVANT REPORT

12. Duty report of the independent Directors for the year 2020.

By order of the Board

Guolian Securities Co., Ltd.

Yao Zhiyong

Chairman

Wuxi, Jiangsu Province, the PRC

1 April 2021

Notes:

In order to determine the entitlement to attend and vote at the AGM of the Company to be held on Friday, 7 May 2021, the register of H Shareholders of the Company will be closed from Tuesday, 27 April 2021 to Friday, 7 May 2021 (both days inclusive) during which period no transfer of shares will be effected.
H Shareholders whose names appear on our register of members on Tuesday, 27 April 2021 shall be entitled to attend the AGM. In order to attend and vote at the AGM, the relevant share certificates accompanied by all transfer documents must be lodged with Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong no later than 4:30 p.m. on Monday, 26 April 2021 for registration.
Shareholders who are entitled to attend and vote at the AGM may appoint one or more proxies to attend and, in the event of a poll, vote on their behalves. A proxy need not be a Shareholder.
The instrument appointing a proxy must be in writing under the hand of a Shareholder or his/her attorney duly authorised in writing. If the Shareholder is a legal person, that instrument must be executed either under its seal or under the hand of its director or other attorney duly authorised to sign the same.
In order to be valid, the proxy form must be deposited, for the H Shareholders, to the H Shares registrar of the Company, Computershare Hong Kong Investor Services Limited, before 1:00 p.m. on Thursday, 6 May 2021 (Hong Kong time). Completion and return of the proxy form will not preclude Shareholders from attending and voting in person at the AGM should they so wish.
Shareholders or their proxies shall produce their identity documents and supporting documents in respect of Shares held or the proxy form signed by the Shareholders or their attorney when appointing authorised representative to attend the AGM.

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NOTICE OF AGM

The AGM are expected to be held for less than half a day. Shareholders who intend to attend the AGM shall arrange and bear their own transportation and accommodation expenses.
The name and address of the Company's H Shares registrar are as follows:
Computershare Hong Kong Investor Services Limited Shops 1712-1716, 17th Floor
Hopewell Centre
183 Queen's Road East Wanchai
Hong Kong
Where there are joint registered holders of any Share(s), any one of such joint holders may attend and vote at the AGM, either in person or by proxy, in respect of such Share(s) as if he/she was solely entitled thereto, but if more than one of such joint holders are present at the AGM, the most senior shall alone be entitled to vote, whether in person or by proxy. For this purpose, seniority shall be determined by the order in which the names stand in the register of members of the Company in respect of the joint holding.

As at the date of this notice, the executive Director of the Company is Mr. Ge Xiaobo; the non-executive Directors of the Company are Mr. Yao Zhiyong, Mr. Hua Weirong, Mr. Zhou Weiping, Mr. Liu Hailin and Mr. Zhang Weigang; and the independent non-executive Directors of the Company are Mr. Lu Yuanzhu, Mr. Wu Xingyu and Mr. Chu, Howard Ho Hwa.

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APPENDIX I	WORK REPORT OF THE SUPERVISORY
	COMMITTEE FOR THE YEAR 2020

During the year 2020, the Supervisory Committee of the Company conducted comprehensive and pragmatic supervision on the decision-making process, operation and management, financial conditions and performance of duties of Directors and senior management of the Company according to law and effectively protected the interests of the Company and all Shareholders in strict compliance with the relevant laws and regulations of the Company Law, the Securities Law, the Rules for Governance of Securities Companies, the Rules Governing the Listing of Securities on Shanghai Stock Exchange, the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and the requirements of the Articles of Association and the Rules of Procedures of the Supervisory Committee of the Company. The main works of the Supervisory Committee for the year 2020 are hereby reported as follows:

WORK OF THE SUPERVISORY COMMITTEE
1. In 2020, the Supervisors of the Company attended 5 general meetings according to law (including 2 Class Meetings) and 10 Board meetings as non-voting attendees, and conducted supervision on the convening and decision-making process of Board meetings, and considered that the Board has earnestly implemented the resolutions of general meetings and faithfully performed their fiduciary duties, and that the resolutions of the Board were in line with the requirements of the Company Law and other laws and regulations as well as the Articles of Association. There was no occurrence of behaviors that were detrimental to the interests of the Company and its Shareholders.
  By attending the relevant meetings of the operating management, the Supervisors of the Company kept abreast of the Company's operation and management, supervised the operating management to fully implement the resolutions of the general meeting and the Board in a timely manner, so as to ensure the objective and impartial supervision over the performance of duties by the senior management of the Company. The Supervisory Committee believes that the operating management of the Company is able to fully implement the resolutions of the Board, organize and implement the Company's development plan and yearly business plan, and strive to promote the transformation of various businesses, and have achieved good results.

- 15 -

APPENDIX I	WORK REPORT OF THE SUPERVISORY
	COMMITTEE FOR THE YEAR 2020

Meetings of the Supervisory Committee of the Company for the Year 2020

The Supervisory Committee of the Company convened five meetings during the year

2020:

The third meeting of the fourth session of the Supervisory Committee was convened

on 21 February 2020, which considered and approved the followings: Annual Report of Guolian Securities Co., Ltd. for the Year 2019（《國聯證券股份有限公司2019年年度報告》）, Profit Distribution Proposal of Guolian Securities Co., Ltd. for the Year 2019（《國聯證券股份有限公司2019年度利潤分配議案》）, Internal Control Self-Assessment Report of Guolian Securities Co., Ltd. for the Year 2019（《國聯證券股份有限公司2019年度內部控制的自我評價報告》）, Risk Management Report of Guolian Securities Co., Ltd. for the Year 2019（《國聯證券股份有限公司2019年度風險管理報告》）, Report of the Supervisory Committee of Guolian Securities Co., Ltd. for the Year 2019（《國聯證券股份有限公司2019 年度監事會工作報告》）, Resolution on the Remuneration Distribution of Supervisors of Guolian Securities Co., Ltd. for the Year 2019（《國聯證券股份有限公司2019年度監事薪酬分配議案》）and Resolution on the Proposal for Considering the Special Audit Report on Major Related Party Transactions of the Company for the Year 2019（《關於提請審議公司 2019年度重大關聯交易專項審計報告的議案》）.

The fourth meeting of the fourth session of the Supervisory Committee was convened

on 3 April 2020, which considered and approved the followings: Report on Compliance Management of Guolian Securities Co., Ltd. for the Year 2019（《國聯證券股份有限公司2019年度合規管理工作報告》）and Report on Anti-Money Laundering of Guolian Securities for the Year 2019（《國聯證券2019年度反洗錢工作報告》）.

The fifth meeting of the fourth session of the Supervisory Committee was convened

on 27 August 2020, which considered and approved the followings: 2020 Interim Report of Guolian Securities Co., Ltd（. 《國聯證券股份有限公司2020年半年度報告》）, 2020 Interim Report on Compliance Management of Guolian Securities Co., Ltd（. 《國聯證券股份有限公司2020年中期合規管理工作報告》）, 2020 Interim Report on Comprehensive Risk Management of Guolian Securities Co., Ltd（. 《國聯證券股份有限公司2020年中期全面風險管理報告》）and Resolution on the Amendments to "the Rules and Procedures of the Supervisory Committee of Guolian Securities Co., Ltd."（《關於修訂〈國聯證券股份有限公司監事會議事規則〉的議案》）.

- 16 -

APPENDIX I	WORK REPORT OF THE SUPERVISORY
	COMMITTEE FOR THE YEAR 2020

The sixth meeting of the fourth session of the Supervisory Committee was convened

on 28 October 2020, which considered and approved the following: 2020 Third Quarterly Report of Guolian Securities Co., Ltd（. 《國聯證券股份有限公司2020年第三季度報告》）.

The seventh meeting of the fourth session of the Supervisory Committee was convened on 18 December 2020, which considered and approved the following: Resolution

on the Amendments to "the Rules and Procedures of the Supervisory Committee of Guolian Securities Co., Ltd."（《關於修訂〈國聯證券股份有限公司監事會議事規則〉的議案》）.

During the reporting period, the attendance of the Supervisors of the Company at the meetings of the Supervisory Committee was as follows:

		Number of
		required
		attendances
		at the	Number of	Number of	Number of	Number of
Name of		Supervisory	actual	attendances in	attendances by	attendances by
Supervisors	Position	Committee	attendances	person	communication	proxy
Jiang Zhiqiang	Chairman of Supervisory	5	5	5	0	0
	Committee
Zhou Weixing	Supervisor	5	5	4	3	1
Ren Jun	Supervisor	5	5	5	5	0
Shen Ying	Employee Representative	5	5	5	0	0
	Supervisor
Yu Lei	Employee Representative	5	5	5	0	0
	Supervisor
Number of Supervisory Committee meetings convened during the year			5
Of which: Number of on-site meetings combined with meetings by communication			5

- 17 -

APPENDIX I	WORK REPORT OF THE SUPERVISORY
	COMMITTEE FOR THE YEAR 2020

OPINIONS OF SUPERVISORY COMMITTEE ON THE RELEVANT MATTERS OF THE COMPANY FOR THE YEAR 2020

During the reporting period, by attending general meetings and Board meetings as non- voting attendees, the Supervisory Committee of the Company inspected the finance of the Company, reviewed the regular reports of the Company, supervised the conduct of Directors and senior management in performing duties of the Company, the following independent opinions were formed:

Opinions on the Operation in Compliance with Laws of the Board

During the reporting period, the Company was able to regulate the operation and compliance management in accordance with the laws and regulations and the systemic requirements of the Company including the Company Law, the Securities Law and the Articles of Association. All significant decision-making or major operating activities of the Company were approved by competent authorities, and the decision-making procedures were legal and valid. According to the requirements of the relevant laws and regulations, the Company established a comprehensive internal control system and all management systems were effectively implemented. During the reporting period, there was no significant violation of the laws and regulations by the Company, nor was the subject of any major administrative penalty or public censure. None of the Directors, Supervisors or senior management of the Company was found to violate the laws, regulations or the Articles of Association or to cause damages to the interests of the Company during the course of performing their duties.

Opinions on the Financial Conditions of the Company

The Company's financial conditions were sound, and the financial system was complete and efficient. The 2020 financial report of the Company was prepared in accordance with Accounting Standards for Business Enterprises of the PRC and International Financial Reporting Standards, and was audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP and Deloitte Touche Tohmatsu respectively. The aforementioned auditors have issued auditors' reports with unqualified opinions. The financial report truly, accurately and completely reflected the financial conditions and operating results of the Company.

- 18 -

APPENDIX I	WORK REPORT OF THE SUPERVISORY
	COMMITTEE FOR THE YEAR 2020

Opinions on the Related Party Transactions of the Company

In 2020, the Board of the Company considered and approved the Resolution on

Confirming the Related Party Transactions of the Company for Recent Three Years（《關於確認公司最近三年關聯交易的議案》）, Resolution on the Agreement to appoint Hua Ying Securities as Lead Underwriter for the Public Issuance of Corporate Bonds of Guolian Group in 2020（《關於同意華英證券擔任國聯集團2020年公開發行公司債券牽頭主承銷商的議案》）and Resolution on Entering into Framework Agreement of Continuing Connected Transactions with Guolian Group and the Determination of the Annual Cap（《關於與國聯集團簽署持續性關連交易框架協議並確定年度上限的議案》）, etc.

After the inspection, the Supervisory Committee considered that, during the reporting period, the above-mentioned related party/connected transactions of the Company had fulfilled the relevant review procedures, and the independent Directors expressed their independent opinions on the related matters and the procedures were legal and effective. The pricing principles of the related party/connected transaction were fair and reasonable, without any circumstances that are detrimental to the interests of the Company and Shareholders, especially the interests of minority Shareholders.

Opinions on Internal Control and Risk Management

The Company has established a relatively sound internal control system, which is in line with relevant laws and regulations and regulatory requirements of the PRC as well as the actual situation of the Company's operation and management, and the internal control system has been effectively implemented. During the reporting period, there were no major defects in the Company's internal control system construction and implementation, and the Company

has established and effectively maintained the internal control related to financial statements in accordance with the Fundamental Norms on Enterprise Internal Control（《企業內部控制基本規範》）and its specific standards in all material aspects.

In 2020, the Company further implemented the requirements of laws and regulations such as Norms for Overall Risk Management of Securities Companies（《證券公司全面風險管理規範》）, continued to improve the comprehensive risk management system and operational mechanism, constantly carried out risk monitoring and evaluation, carried out

all new businesses in a regulated and prudent manner, strengthened the risk management of existing projects, actively promoted risk incident response and disposal, and continuously improved risk management level.

- 19 -

APPENDIX I	WORK REPORT OF THE SUPERVISORY
	COMMITTEE FOR THE YEAR 2020

Opinions on Compliance Management

According to the requirements of the Measures for Compliance Management of

Securities Companies and Securities Investment Fund Management Companies（《證券公司和證券投資基金管理公司合規管理辦法》）, the Guidelines on Effectiveness Evaluation of Compliance Management of Securities Companies（《證券公司合規管理有效性評估指引》）of the Securities Association of China and other laws, regulations and standards, the Supervisory Committee of the Company took the lead in establishing an interdepartmental

compliance management effectiveness evaluation tream to evaluate the compliance management effectiveness of the Company for 2020.

In the process of evaluating the compliance management effectiveness, the evaluation tream evaluated the compliance management situation of various business and management departments by adopting the interview, system and business documents review, sampling analysis, walk through test and other evaluation methods, which provided necessary evaluation basis for assessing the effectiveness of the Company's compliance management.

According to the evaluation, the Company has developed and effectively implemented corresponding management systems for the businesses and issues subject to assessment during the reporting period, and its targets for compliance management were fulfilled. There was no material compliance risk in all aspects.

Opinions on the Use of Proceeds Raised by the Company

As approved by the CSRC, the Company completed the issuance of A Shares in July

2020. The proceeds raised from A Shares offering has been verified by Deloitte Touche Tohmatsu Certified Public Accountants LLP and issued the Deshibao (Yan) Zi (20) No. 00324 Capital Verification Report. According to the Capital Verification Report, the total proceeds of A Shares offering raised amounted to RMB2,021,805,750, and the net amount of proceeds raised was RMB1,938,084,540.00, which was used to supplement share capital and capital reserves. The Company has strictly complied with the relevant requirements of the PRC and the Company regarding the management on the transfer, deposit and use of the proceeds. All businesses relating the proceeds have been conducted in compliance with the authorisation and approval procedures, so as to ensure the compliance of the proceeds usages.

- 20 -

APPENDIX I	WORK REPORT OF THE SUPERVISORY
	COMMITTEE FOR THE YEAR 2020

In accordance with the Administrative Measures on the Issuance of Securities by Listed Companies 《( 上市公司證券發行管理辦法》) and the Rules on the Report on the Use of Proceeds Raised Previously 《( 關於前次募集資金使用情況報告的規定》) issued by the CSRC, and according to the actual situation of the Company, the Company has prepared

the Report on the Use of Proceeds Raised Previously by Guolian Securities Co., Ltd. (As of 31 December 2020) 《( 國聯證券股份有限公司前次募集資金使用情況報告（截至2020 年12月31日止）》), and an Assurance Report on the Use of Proceeds Raised Previously by Guolian Securities Co., Ltd. 《( 國聯證券股份有限公司關於前次募集資金使用情況的鑒證報告》) was issued by Deloitte Touche Tohmatsu Certified Public Accountants LLP. As of 31 December 2020, a total of RMB1,938,084,540.00 of the proceeds raised previously has

been used up by the Company. All the proceeds raised have been used up as committed, and there was no balance in the relevant bank accounts and all accounts have been cancelled. The Company has not changed the use of proceeds for investment projects.

In 2020, the Company conducted debt financing activities according to the mandate granted at the general meetings and the cumulative debt financing (excluding interbank borrowing transactions and the floating-income income certificates issued) amounted to RMB18.024 billion, and the cumulative principal repayment of debt financing matured amounted to RMB10.664 billion. The Company conducted debt financing within the limit authorised at the general meetings and there was no case without or beyond the approval of the general meetings.
The Supervisory Committee of the Company reviewed the regular reports prepared by the Board and was of the view that the Company's regular reports were prepared and reviewed in compliance with relevant laws, regulations and the requirements of regulatory authorities. The content of the reports gave a true, accurate and complete
reflection of the actual situation of the Company. The Supervisory Committee reviewed the Profit Distribution Proposal of Guolian Securities for the Year 2019（《國聯證券2019年度利潤分配預案》）and considered that the profit distribution proposal met the relevant requirements, and agreed to submit the proposal to the Company's general meeting for consideration.

- 21 -

APPENDIX I	WORK REPORT OF THE SUPERVISORY
	COMMITTEE FOR THE YEAR 2020

WORK PLAN OF THE SUPERVISORY COMMITTEE FOR THE YEAR 2021
1. To convene the meetings of the Supervisory Committee in strict compliance with the requirements of the Company Law, the Articles of Association and the relevant laws and regulations. To attend general meetings and various meetings of the Board and management as non-voting attendees as required in fulfilling their supervisory duties.
2. To conscientiously fulfill the duties of the Supervisory Committee, supervise the implementation of the resolutions adopted at general meetings and Board meetings and strengthen the supervision and management regarding the financial conditions, risk control and regulatory indicators of the Company. To carefully review the regular reports, accounting statements and related financial information of the Company, pay attention to the preparation and review procedures of the Company's financial reports, and ensure that the contents of the regular reports of the Company can reflect the operation and management and financial conditions of the Company in a true, accurate and complete manner.
3. To supervise and inspect the duty and responsibility performance of the Board and management in overall risk management, and rectification of defects.
4. To strengthen self-building and improve self-capabilities of duties performance. All Supervisors will actively study and master the latest regulatory policies in depth, participate in the professional seminars and training organized by securities regulatory authorities, self-regulatory organizations and other institutions and use the excellent supervision and management experience of the same industry as a reference to constantly improve their knowledge reserve.

- 22 -

APPENDIX II	FINAL ACCOUNTS REPORT FOR THE YEAR 2020

In 2020, the COVID-19 epidemic had exerted a huge impact on global economic and financial market. Under the active and effective epidemic prevention and control measures in China, we achieved significant economic recovery, and the stock index went up overall. According to the statistics of WIND, the stocks and funds trading volume on the market increased by 61% year-on- year as compared with 2019. The Company practiced the philosophy of "Second Entrepreneurship" and successfully completed the A-Shares listing, making it the 13th securities company in the country with a dual listing status on both the A+H markets. As a result, the Company's Capital strength has been greatly improved, new products and new services have been continuously innovated, business transformation has achieved initial results, and the overall business layout has become more diversified and stable. The Company actively adapted itself to the new industry layout and market situation, strictly upheld the bottom line of compliance and risk control and promoted the in-depth strategic transformation and market reform.

According to the financial report prepared in accordance with the Accounting Standards for Business Enterprises of the PRC, as at the end of the reporting period, the total assets in the consolidated financial statement of the Company amounted to RMB46.220 billion and total shareholder interests amounted to RMB10.594 billion. During the reporting period, operating income amounted to RMB1.876 billion and net profit of RMB588 million.

The final accounts during the reporting period are set out as follows:

Financial Position and Business Performance

					Unit: RMB'0,000
	In 2020/	Consolidated		In 2020/	Parent Company

	as at	As at		as at	As at
	the end of	the end of	Year-on-	the end of	the end of	Year-on-
Item	2020	2019	year change	2020	2019	year change
Total assets	4,621,995	2,841,940	63%	4,509,304	2,704,489	67%
Total liabilities	3,562,578	2,035,208	75%	3,464,109	1,910,232	81%
Total shareholder interests	1,059,417	806,732	31%	1,045,195	794,257	32%
Net capital	1,097,699	839,959	31%	997,833	746,112	34%
Operating income	187,634	161,938	16%	157,158	134,749	17%
Total operating expense	108,762	93,187	17%	81,785	70,065	17%
Operating profit	78,872	68,751	15%	75,373	64,684	17%
Total profits	78,792	68,649	15%	75,307	64,547	17%
Net profits	58,787	52,134	13%	56,792	48,589	17%
Total consolidated income	56,989	52,134	9%	57,129	48,589	18%
Weighted average returns on
net assets	6.41%	6.64%	-3%	6.29%	6.27%	0.3%
Net assets/liabilities	40.28%	66.45%	-39%	41.29%	72.93%	-43%
Gearing ratio	71.28%	60.08%	19%	70.78%	57.83%	22%
Earnings per share
(RMB/share)	0.28	0.27	4%
Net asset value per
share attributable to
Shareholders of the
Company	4.45	4.24	5%

Note: Client funds are not included in the total assets and total liabilities in the calculation formula of net assets/ liabilities and gearing ratio.

- 23 -

APPENDIX II	FINAL ACCOUNTS REPORT FOR THE YEAR 2020

BALANCE SHEET

As at the end of the reporting period, total assets of the Company were RMB46.220 billion; total liabilities were RMB35.626 billion; total shareholder interests were RMB10.594 billion. Of which, total assets of parent company were RMB45.093 billion; total liabilities were RMB34.641 billion; total shareholder interests were RMB10.452 billion.

Condensed Balance Sheet:

Unit: RMB'0,000

			Consolidated			Parent Company
		As at	As at	Year-on-	As at	As at	Year-on-
		the end of	the end of	year	the end of	the end of	year
Item		2020	2019	Change	2020	2019	Change
Total assets	4,621,995	2,841,940	63%	4,509,304	2,704,489	67%
Of which:	Monetary capital	1,073,038	930,497	15%	999,730	848,306	18%
	Clearing settlement
	funds	251,161	210,054	20%	250,799	209,155	20%
	Refundable
	deposits	23,664	6,463	266%	23,426	6,422	265%
	Financial assets
	held for trading	1,695,509	822,295	106%	1,356,807	721,378	88%
	Derivative
	financial assets	7,764	0	-	7,764	0	-
	Other debt
	investments	167,804	0	-	167,804	0	-
	Funds lent	841,307	463,840	81%	841,307	463,840	81%
	Financial assets
	purchased under
	agreements to
	resell	412,752	342,693	20%	384,557	281,859	36%
	Other assets	95,724	11,531	730%	94,124	10,456	800%
Total Liabilities	3,562,578	2,035,208	75%	3,464,109	1,910,232	81%
Of which:	Amount of
	agency sales of
	securities	932,720	821,233	14%	932,720	821,233	14%
	Financial assets
	sold under
	repurchase
	agreements	870,769	369,299	136%	850,466	368,599	131%
	Short-term
	financing
	instrument
	payables	478,142	130,903	265%	478,142	130,903	265%
	Bonds payable	899,834	514,599	75%	897,238	513,693	75%
	Loans from other
	banks	30,007	20,028	50%	30,007	20,028	50%
	Remuneration
	payable to
	employees	33,824	25,907	31%	22,460	17,611	28%
	Other liabilities	154,035	2,650	5,713%	153,468	1,968	7,698%
Total shareholder interests	1,059,417	806,732	31%	1,045,195	794,257	32%

- 24 -

APPENDIX II	FINAL ACCOUNTS REPORT FOR THE YEAR 2020

As at the end of the reporting period, total assets of the Company increased by RMB17.801 billion to RMB46.220 billion, representing an increase of 63% as compared with the end of last year. The increase was mainly attributed to the following factors: 1) the securities market became more active, as a result, the transaction volume of stocks and funds increased by 61% year-on-year, and monetary capital, clearing settlement funds and refundable deposits increased by RMB2.008 billion year-on-year; 2) funds lent increased by RMB3.775 billion year-on-year as the Company continuously improved its professionalism and customer service capabilities and actively carried out marketing activities for credit business by following market trend; Financial assets held under resale agreements increased by RMB701 million year-on-year as the Company reduced the scale of existing stock pledge business while carrying out bond pledge repurchase business under the premise of strictly controlling and resolving risks; 3) financial assets held for trading, derivative financial assets and other debt investments increased by RMB10.488 billion year-on-year as the Company closely followed the market trend to enrich trading varieties and optimize the portfolio structure; and 4) other assets of the margin deposits of derivative contracts increased by RMB842 million as the Company developed OTC derivatives business.

As at the end of the reporting period, total liabilities of the Company increased by RMB15.274 billion to RMB35.626 billion, representing an increase of 75% as compared with the end of last year. The increase was mainly attributed to the following factors: 1) the amount of agency sales of securities increased by RMB1.115 billion year-on-year due to the rise in index and active trading; 2) current short-term financing instrument payables, bonds payable, loans from other banks and financial assets sold under repurchase agreements increased by RMB12.439 billion year-on-year as the Company had expanded its financing channels and steadily improved financial leverage in supporting its business development; 3) remuneration payable to employees increased by RMB79 million year-on-year as the Company strengthened its performance assessment while enhancing its operating results; and 4) other liabilities of the margin deposits payable of derivative contracts increased by RMB1.514 billion as the Company developed OTC derivatives business.

- 25 -

APPENDIX II	FINAL ACCOUNTS REPORT FOR THE YEAR 2020

FINANCIAL INCOME AND EXPENDITURE

During the reporting period, the Company recorded an operating income of RMB1.876 billion. Total operating expenses incurred were RMB1.088 billion. Total profit recorded was RMB788 million. Net profit attributable to shareholders of parent company was RMB588 million. Earnings per share were RMB0.28. Of which, operating income of parent company was RMB1.572 billion. Total operating expenses incurred were RMB818 million. Total profit recorded was RMB753 million. Net profit was RMB568 million.

Condensed Profit and Loss Statement:

Unit: RMB'0,000

		Consolidated	Year-on-		Parent Company	Year-on-

			year			year
Item	2020	2019	Change	2020	2019	Change
Operating Income	187,634	161,938	16%	157,158	134,749	17%
Net fee and commission
income	87,548	67,375	30%	63,391	45,207	40%
Of which: Net fee income
from brokerage
business	52,625	35,965	46%	52,625	35,965	46%
Net fee income
from investment
banking
business	27,502	24,565	12%	2,705	1,826	48%
Net fee income
from asset
management
business	7,159	6,499	10%	7,798	7,070	10%
Net interest
income	30,562	49,737	-39%	26,746	44,310	-40%
Investment gains	59,229	21,523	175%	60,041	21,993	173%
Gains on change in
fair value	8,727	21,250	-59%	5,710	21,340	-73%
Total operating expenses	108,762	93,187	17%	81,785	70,065	17%
Of which: Taxes and
surcharges	1,498	1,071	40%	1,278	895	43%
Operating and
administrative
expenses	106,043	93,360	14%	79,403	70,577	13%
Credit/asset
impairment			-			-
losses	1,221	(1,244)	1,104	(1,406)
Operating profit	78,872	68,751	15%	75,373	64,684	17%
Total profit	78,792	68,649	15%	75,307	64,547	17%
Net profit	58,787	52,134	13%	56,792	48,589	17%
Of which: Net profit
attributable to
shareholders of
parent company	58,787	52,134	13%
Basic earnings per share
(Unit: RMB)	0.28	0.27	4%

- 26 -

APPENDIX II	FINAL ACCOUNTS REPORT FOR THE YEAR 2020

During the reporting period, the Company recorded an operating income amounting to RMB1.876 billion, representing a year-on-year increase of RMB257 million, or an increase of 16%. The increase was mainly due to: 1) the Company adhered to the prudent value investment operation strategy, closely followed market changes, enriched trading varieties and optimized investment portfolios, as a result, the income generated from securities investment business increased significantly; 2) income generated from brokerage business achieved a year-on-year substantial increase benefitted from the rise in index and active trading; and 3) the Company optimized and adjusted the structure of credit business by closely following the market trend, the income generated from margin financing and securities lending increased significantly, which effectively offset the decline in the income from stock pledge business; the Company had expanded its financing channels and steadily improved financial leverage, interest expenses increased and net interest income decreased year-on-year.

During the reporting period, the Company recorded total operating expenses amounting to RMB1.088 billion, representing a year-on-year increase of RMB156 million, or an increase of 17%, in support of business transformation, introducing high-end talents, strengthening system construction and optimizing network layout.

During the reporting period, the Company recorded total profits amounting to RMB788 million, representing a year-on-year increase of RMB101 million, or an increase of 15%.

SHAREHOLDER INTERESTS AND NET CAPITAL

As at the end of the reporting period, total shareholder interests of the Company were RMB10.594 billion, representing an increase of RMB2.527 billion as compared with the end of last year. The increase was mainly due to the A Shares listing of the Company raised net funds of RMB1.938 billion, realization of net profit which resulted in a corresponding increase in shareholder interests of RMB404 million, and the provision for surplus provident fund and general risk reserve which resulted in an increase in shareholder interests of RMB184 million.

Due to the supplement of net capital for A Shares listing during the reporting period, the net capital of the Company at the end of the period was RMB10.977 billion, increased by RMB2.577 billion as compared with the end of last year.

At the end of the period, the ratio of net capital divided by net assets of the Company was

103.79% and each risk control indicator has complied with the requirements of the Administrative Measures for Risk Control Indicators of Securities Companies（《證券公司風險控制指標管理辦法》）. The asset structure of the Company remained sound and the liquidity was strong.

- 27 -

APPENDIX II	FINAL ACCOUNTS REPORT FOR THE YEAR 2020

During the reporting period, the Company closely kept up the pace with the market, expanded the scale of assets and liabilities significantly, steadily improved financial leverage and continuously adjusted business structure, with costs and expenses linked to performance, and all indicators remained at reasonable position.

Looking forward into 2021, with the theme of "maintaining momentum, making persistent efforts, and expanding business scale through concerted efforts", the Company will further enhance its capital strengths, optimize and adjust business layout, comprehensively strengthen customer coverage to expand its customer scale, and optimize its construction of systems to enhance its core competitiveness. Through focusing on serving the real economy and leading by the direction of high-quality development, the Company will strive to become a leading customer-oriented investment bank that provides comprehensive financial solutions and the most important investment and financing arranger, transaction organizer, wealth manager and liquidity provider in local regional market, striving to become a comprehensive securities broker with distinctive business features.

- 28 -

APPENDIX III	ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS
	OF THE COMPANY FOR THE YEAR 2021

IMPLEMENTATION OF ORDINARY RELATED PARTY TRANSACTIONS OF THE COMPANY FOR THE YEAR 2020

The first extraordinary general meeting for the year 2020 of the Company considered and

approved the Estimated Ordinary Related Party Transactions of the Company for the Year 2020 （《預計公司2020年度日常關聯交易》）, which approved that the Company and Guolian Group and its subsidiaries to conduct related transactions under the Securities and Financial Services

Framework Agreement and the Property Leasing and Related Services Framework Agreement entered into in December 2017 and within the annual cap of transaction for 2018-2020 approved at the 17th meeting of the third session of Board; and approved that the Company to conduct related transactions with other related legal persons. Due to uncertainties of the occurrence and volume of such business, the projected cap will be the actual transaction amount.

Related party transactions with Guolian Group and its subsidiaries

		Unit: RMB'0,000
Type of related	Content of related party	Annual cap	Actual amount
party transactions	transactions	for 2020	in 2020
Securities and	Revenue received:
Financial
Services	Including securities brokerage	3,986.00	858.91
	and Futures IB services, asset
	management service, agency sales
	service of financial products,
	financial advisory service and other
	financial services approved by
	CSRC.
	Expenses incurred:
	Including management service of trust	1,980.00	107.27
	schemes and other financial services
	approved by China Banking and
	Insurance Regulatory Commission.

- 29 -

APPENDIX III	ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS
		OF THE COMPANY FOR THE YEAR 2021

Type of related		Content of related party	Annual cap	Actual amount
party transactions	transactions	for 2020	in 2020
Property Leasing	Revenue received:
and Related
Services		Including income received from	500.00	89.29
		leasing properties.
		Expenses incurred:
		Including expenses incurred for leasing	3,210.00	1,968.67(Note)
		properties, fee expense incurred for
		the related property services.

Note: The Company has implemented IFRS 16 since 1 January 2019. The actual amount of leased properties includes rental expenses (including interest expenses on lease liabilities) and depreciation expenses for related right-of-use assets. In 2020, the total depreciation expenses of relevant right-of-use assets was be RMB11.9965 million.

Related party transactions with other related legal persons

Unit: RMB'0,000

				Actual
Type of related party	Content of related		Projected amount	amount
transactions	party transactions	Related parties	in 2020	in 2020
Securities and	Income from securities	Zhonghai Fund Management	Due to uncertainties	335.36
Financial Services	brokerage business	Co., Ltd.	of the occurrence
			and volume of
		China Asset Management	such business,	301.99
		Co., Ltd.	the projected cap
			will be the actual
		Others	transaction amount	3.91
	Income from asset	Wuxi Weifu High-technology		3.06
	management business	Co.,Ltd.
	Income from financial	Wuxi Sunan International		4.72
	advisory	Airport Co., Ltd.
Securities and	Bond transactions	China Asset Management		13,888.88
Financial Product		Co., Ltd.
Transactions
	Subscription of non-	Wuxi Rural Commercial		5,000.00
	public issuance	Bank Co., Ltd.
	of bonds of the
	Company

- 30 -

APPENDIX III	ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS
	OF THE COMPANY FOR THE YEAR 2021

PROJECTED ORDINARY RELATED PARTY TRANSACTIONS OF THE COMPANY IN 2021

Projected related party transactions with Guolian Group and its associates

Type of		Caps for and descriptions
transactions	Content of transactions	of projected transactions

Securities and	The Company provide securities
Financial Product	brokerage (including seat leasing)
Services	services, Futures IB services,
	securities asset management services,
	agency sales of financial products
	services, financial advisory services,
	underwriting and sponsorship services,
	securities investment consultancy
	services and other financial services
	approved by CSRC to related parties.
	Related parties provide management
	services of trust schemes, futures
	brokerage services, futures investment
	consultancy services, commercial
	insurance services and other financial
	services approved by CSRC and
	CBIRC to the Company.
Securities and	The Company conducts sales under
Financial Product	repurchase agreements in the inter-
Transactions	bank and exchanges market with
	related parties; subscribes for the trust
	schemes and other products issued by
	related parties; related parties subscribe
	for the income certificates, bonds, asset
	backed securities and pledged dealer-
	quoted repurchase products issued by
	the Company; interbank borrowings.

Due to uncertainties of the occurrence and volume of such business, the projected cap will be the actual transaction amount.

- 31 -

APPENDIX III	ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS
	OF THE COMPANY FOR THE YEAR 2021

Type of		Caps for and descriptions
transactions	Content of transactions	of projected transactions

Property Leasing	Related parties lease properties from the
and Related	Company.
Services
	The Company lease properties from
	related parties and related parties
	provide relevant services, including
	but not limited to equipment leasing,
	property management, security and
	flower leasing services.

Incomes will not exceed RMB3 million; Expenses will not exceed RMB33.7 million Note .

Note: Lease property expenses include rental expenses (including interest expenses on lease liabilities) and depreciation expenses of related right-of-use assets.

The related transactions between the Company and the Guolian Group and its associates stipulated in the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited are conducted under Securities and Financial Framework Agreement and Property Leasing and Related Services Framework Agreement entered into by the Company and the Guolian Group in December 2020, and in accordance with the annual caps for 2021 to 2023 as determined by the fourteenth meeting of the fourth session of Board of the Company.

Projected related party transactions with other related legal persons

Type of		Caps for and descriptions
transactions	Content of transactions	of projected transactions

Securities and	The Company provide securities
Financial Product	brokerage (including seat leasing)
Services	services, Futures IB services,
	securities asset management services,
	agency sales of financial products
	services, financial advisory services,
	underwriting and sponsorship services,
	securities investment consultancy
	services and other financial services
	approved by CSRC to related parties.

Due to uncertainties of the occurrence and volume of such business, the projected cap will be the actual transaction amount.

- 32 -

APPENDIX III	ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS
	OF THE COMPANY FOR THE YEAR 2021

Type of		Caps for and descriptions
transactions	Content of transactions	of projected transactions

Securities and	The Company conducts held under resale
Financial Product	agreements or sales under repurchase
Transactions	agreements in the inter-bank and
	exchanges market with related parties;
	proprietary bond in the inter-bank
	and exchanges market with related
	parties; over-the-counter derivatives
	transactions with related parties in the
	over-the-counter market or trading
	venues recognized by the regulatory
	authorities; transfer of income rights
	with related parties; subscribe for
	funds, wealth management products,
	income certificates or trust schemes
	issued by related parties; related parties
	subscribe for asset management plans,
	wealth management products, income
	certificates, bonds, asset-backed
	securities and pledged quotation
	repurchase products issued by the
	Company; inter-bank lending; and
	transfer transactions of listed stocks
	with related parties in the national
	share transfer system.

Due to uncertainties of the occurrence and volume of such business, the projected cap will be the actual transaction amount.

Projected related party transactions with related natural persons

During the ordinary course of business of the Company, the related natural persons accept financial services approved by the CSRC, such as securities brokerage services and asset management services provided by the Company, or subscribe for wealth management products, income certificates, and pledged quotation repurchase products of the Company according to the laws, regulations and regulatory requirements. Due to uncertainties of the occurrence and volume of such business, the projected cap will be the actual transaction amount.

- 33 -

APPENDIX III	ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS
	OF THE COMPANY FOR THE YEAR 2021

INTRODUCTION OF RELATED PARTIES AND RELATED RELATIONSHIP
1. Guolian Group and related companies

Guolian Group and its related companies include: Guolian Group; companies directly or indirectly controlled by Guolian Group other than the Company and its holding subsidiaries; important upstream and downstream companies of Guolian Group and its controlled companies; companies that are directly or indirectly controlled by the directors, supervisors and senior management of Guolian Group, or they serve as directors or senior management other than the Company and the holding subsidiaries of the Company.

Other related legal persons

Companies that are directly or indirectly control by the directors, supervisors and senior management and their close family members of the Company, or they serve as directors, senior management other than the Company and the holding subsidiaries of the Company (excluding the above listed related parties).

Related natural persons

The Directors, Supervisors and senior management of the Company and their close family members; the directors, supervisors and senior management of the Guolian Group.

IV. PRICING PRINCIPLES AND BASIS FOR RELATED PARTY TRANSACTIONS

Securities and financial product services

Service fees and commissions for securities and financial products shall be determined based on arms' length negotiations according to the relevant laws and regulations and by reference to market price.

Securities and financial product transactions

Securities and financial product transactions will be conducted on arms' length negotiations between the mutual parties at the market price or market rate applicable to that type of securities and financial products at the time.

- 34 -

APPENDIX III	ESTIMATED ORDINARY RELATED PARTY TRANSACTIONS
	OF THE COMPANY FOR THE YEAR 2021

Property leasing and related services

The rents of the leased properties of both parties refer to the current market rent levels of properties with similar location and scale to the relevant leased properties, and are determined on arms' length negotiations between the mutual parties.

THE PURPOSE OF RELATED PARTY TRANSACTIONS AND THE IMPACT ON THE COMPANY
1. Relevant related transactions are part of the normal business of the Company, which could generate certain income for the Company and contribute to the development of the Company's business.
2. Relevant related transactions are priced with reference to market prices, which are fair, and there is no situation that harms the interests of the Company and the shareholders of the Company as a whole.
3. The principal business of the Company does not rely on related parties due to the above-mentioned related transactions, and relevant related transactions do not affect the independence of the Company.

- 35 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

As the independent Directors of Guolian Securities Co., Ltd. (hereinafter referred as the "Company"), we fulfilled our duties diligently and responsibly, actively attended relevant meetings

and earnestly reviewed every resolution in accordance with the requirements of the Guidance on Establishment of Independent Director System for Listed Companies 《( 關於在上市公司建立獨立董事制度的指導意見》), the Guidelines on the Governance of Listed Companies, the Rules Governing the Listing of Securities on the Shanghai Stock Exchange of CSRC, the Guidance on the Format of Annual Duty Report of Independent Directors 《( 獨立董事年度述職報告格式指引》) of Shanghai Stock Exchange, the Articles of Association and the Independent Director System of

the Company to effectively safeguard the interests of the Shareholders as a whole, especially the legitimate interests of minority Shareholders. The duty report of independent Directors for the year

2020 is set out as follows:

BASIC INFORMATION OF INDEPENDENT DIRECTORS

Currently, the fourth session of Board of the Company is comprised of a total of 9 Directors, of which 3 are independent Directors, namely Mr. Lu Yuanzhu, Mr. Wu Xingyu and Mr. Chu, Howard Ho Hwa respectively. The basic information of independent Directors are as follows:

1. Working experience and professional background

Mr. Lu Yuanzhu（盧遠矚）, born in 1977, Chinese nationality with no right of permanent residency abroad, holds a doctoral degree in economics. He is currently a

professor at the School of International Finance of Sun Yat-sen University, independent non- executive director of Beijing Global Safety Technology Co., Ltd*（北京辰安科技股份有限公司）(300523.SZ) and Beijing Tianyishangjia New Material Corp., Ltd.*（北京天宜上佳高新材料股份有限公司）(688033.SH). He is an independent non-executive Director of the Company since March 2017 to date. He previously served as an assistant professor,

associate professor and professor of China Economics and Management Academy of the Central University of Finance and Economics*（中央財經大學中國經濟與管理研究院）and independent non-executive director of eFuture Holding Inc.*（北京富基融通科技有限公司）.

- 36 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

Mr. Wu Xingyu（吳星宇）, born in 1976, Chinese nationality with no right of permanent residency abroad, holds a master's degree, the non-practising member certificate of Chinese Public Accountant, the PRC lawyer's qualification certificate and USA Chartered

Financial Analyst (CFA) certificate. He is currently the chief financial officer of Land Space Technology Corporation Ltd.*（藍箭航天空間科技股份有限公司）, independent director of Shanghai PRET Composites Co., Ltd（. 上海普利特複合材料股份有限公司）（002324. SZ ）, Beijing Tongrentang Co., Ltd（. 北京同仁堂股份有限公司）（600085.SH ）and Sailvan Times Technology Co., Ltd.*（賽維時代科技股份有限公司）. He is an independent non- executive director of the Company since November 2018 to date. He previously served as

the deputy general manager and chief financial officer of Aotecar New Energy Technology Co., Ltd（. 奧特佳新能源科技股份有限公司）（002239.SZ ）, independent director of Anhui Tongfeng Electronics Company Limited（安徽銅峰電子股份有限公司）（600237.SH ）and Hubei Jumpcan Pharmaceutical Co., Ltd（. 湖北濟川藥業股份有限公司）（600566.SH ）, and vice president and secretary to the board of Shanying International Holdings Co., Ltd（. 山鷹國際控股股份公司）(600567.SH).

Mr. Chu, Howard Ho Hwa（朱賀華）, born in 1964, a resident of Hong Kong, China, holds a master's degree in business administration. He is currently a fund partner of Go Capital Limited and an independent non-executive director of BOE Varitronix Limited （0710.HK ）. He is an independent non-executive director of the Company since June 2019 to date. He previously served as the director of ABN AMRO Asia Corporate Finance Ltd., co-CEO and co-founder of Hong Kong MyRice.com, director of HSBC Investment Bank, chief investment officer of Shanghai Century Acquisition Corporation, assistant to chairman of United Energy Group Limited (0467.HK), chief financial officer of Trony Solar（2468. HK, delisted ）, independent non-executive director of Directel Holdings Limited (8337.HK), independent non-executive director of China Kingstone Mining Holdings Limited (1380. HK), chief financial officer of China Smart Electric Group Limited*（中國智能電氣集團有限公司）, independent non-executive director of Weichai Power Co., Ltd. (2338.HK) and the chief executive officer of mReferral Corporation (HK) Limited.

- 37 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

2. Positions in entities other than the Company

Name	Position	Positions in other organizations
		Name of organization	Position
Lu Yuanzhu	Independent	Sun Yat-sen University	Professor
	Director	Beijing Global Safety Technology	Independent
		Co., Ltd*（北京辰安科技股份	Director
		有限公司）
		Beijing Tianyishangjia New	Independent
		Material Corp., Ltd.*（北京天宜	Director
		上佳高新材料股份有限公司）
Wu Xingyu	Independent	Land Space Technology	Chief financial
	Director	Corporation Ltd.*（藍箭航天空	officer
		間科技股份有限公司）
		Shanghai PRET Composites Co.,	Independent
		Ltd（. 上海普利特複合材料股份	Director
		有限公司）
		Beijing Tongrentang Co., Ltd（. 北	Independent
		京同仁堂股份有限公司）	Director
		Sailvan Times Technology Co., Ltd.*	Independent
		（賽維時代科技股份有限公	Director
		司）
Chu, Howard	Independent	BOE Varitronix Limited	Independent
Ho Hwa	Director		Director
		Go Capital Limited	Fund partner

- 38 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

3. Independence

None of the independent Directors of the Company holds any position in the Company other than independent Directors, or holds any position in the substantial Shareholders of the Company. None of the independent Directors has been subject to any punishment by CSRC or other related departments, or reprimand by any stock exchanges. None of the independent Directors themselves or those who have immediate family relationships with them holds, directly or indirectly, 1% or more of the interests in the issued shares of the Company or rank among the top ten Shareholders of the Company. As such, the independence is not affected.

FULFILLMENT OF RESPONSIBILITIES OF INDEPENDENT DIRECTORS

Attendance at meetings

1. Attendance at Board meetings and general meetings

During the reporting period, the Company convened 5 general meetings, including 1 annual general meeting, 2 extraordinary general meetings and 2 class meetings. The Board convened 10 on-site voting meetings combined with meetings by communication. The attendance of independent Directors at the Board meetings and general meetings was as follows:

			Board meetings
			Number of			Number of
	Number of	Number of	attendances	Number of		attendances
	required	attendances	by	attendances	Number of	at general
Name	attendances	in person	communication	by proxy	absence	meetings
Lu Yuanzhu	10	10	9	0	0	5
Wu Xingyu	10	10	10	0	0	5
Chu, Howard Ho Hwa	10	10	10	0	0	4

Note: Mr. Chu, Howard Ho Hwa did not attend the second extraordinary general meeting of the Company for the year 2020 due to business reasons.

- 39 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

2. Attendance at Special Committees meetings of the Board

There are four special committees under the Board of the Company, including Strategy Committee, Remuneration and Nomination Committee, Audit Committee and Risk Control Committee.

The appointments of independent Directors under the special committees of the Company are as follows:

Name	Appointment
Lu Yuanzhu	Chairman of Remuneration and Nomination
	Committee, member of Audit Committee
Wu Xingyu	Chairman of Audit Committee, member of
	Remuneration and Nomination Committee, member
	of Risk Control Committee
Chu, Howard	Member of Audit Committee, member of Strategy
Ho Hwa	Committee

The attendance of the Company's independent Directors at the meetings is as follows:

During the reporting period, the Company convened 3 Strategy Committee meetings, 3 Remuneration and Nomination Committee meetings, 5 Audit Committee meetings and 4 Risk Control Committee meetings. The attendance of independent Directors at the meetings is as follows:

	Strategy Committee
	Number of	Number
	required	of actual	Number of
Name	attendances	attendances	absence
Chu, Howard Ho Hwa	3	3	0

- 40 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
		DIRECTORS FOR THE YEAR 2020

		Remuneration and Nomination Committee
		Number of	Number
		required	of actual	Number of
Name		attendances	attendances	absence
Lu Yuanzhu		3	3	0
Wu Xingyu		3	3	0
			Audit Committee
		Number of	Number
		required	of actual	Number of
Name		attendances	attendances	absence
Lu Yuanzhu		5	5	0
Wu Xingyu		5	5	0
Chu, Howard Ho Hwa	5	5	0
		Risk Control Committee
		Number of	Number
		required	of actual	Number of
Name		attendances	attendances	absence
Wu Xingyu		4	4	0
(II) Performance of duties

During the reporting period, the independent Directors fulfilled their duties in an objective, independent, and prudent manner. They actively participated in the meetings of the Board and various special committees, carefully considered each topic in a professional and independent manner. They focused on the corporate governance of the Company, the protection of Shareholders' interests, risk control, compliance management, related party transactions, major investment and financing, actively participated in the discussions and made constructive professional recommendations, they played an active role in realizing scientific decision-making by the Board and practically safeguarded the lawful rights and interests of the Company and all Shareholders.

- 41 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

AREAS FOCUSED BY THE INDEPENDENT DIRECTORS DURING THEIR PERFORMANCE OF DUTIES DURING THE YEAR
1. Related Party Transactions

On 17 January 2020, the first extraordinary general meeting for the year 2020 of the

Company considered and approved the Resolution on the Estimated Ordinary Related Party Transactions of the Company for the Year 2020（《關於預計公司2020年度日常關聯交易的議案》）. All independent Directors are of the opinion that the Company's estimation for the ordinary related party transactions for the year 2020 had met the requirements of the

laws and regulations, Articles of Association and the Company's management measures for related party transactions, and proceeded in accordance with the daily operation and business development needs of the Company. The relevant related party transactions form part of the Company's normal business and are able to bring some benefits to the Company and are conducive to its business development. The relevant related party transactions are priced with reference to the market price and the transaction is fair, without any circumstances that are detrimental to the interests of the Company and Shareholders as a whole. The principal businesses of the Company are not dependent on related parties due to the above- mentioned related party transactions, and the relevant related party transactions do not affect the Company's independence. The Company's approval and decision-making procedures in respect of the related party transactions are legal and comply with relevant regulations and the provisions of the Articles of Association.

On 21 February 2020, the 6th meeting of the fourth session of the Board considered

and approved the Resolution on Considering the Related Party Transactions of the Company for Recent Three Years（《關於審議公司最近三年關聯交易的議案》）. The independent Directors of the Company expressed the following independent opinions: All the related

party transactions that took place in 2017, 2018 and 2019 had met the requirements for the daily production and operation of the Company and were on the basis of fairness and reasonableness. The price or pricing method of the related party transactions were reasonable and fair and followed the principle of fairness, openness, equity and integrity, without any circumstances that are detrimental to the interests of the Company and other Shareholders. Effective measures have been taken to regulate and reduce the number of related party transactions. The Company's approval and decision-making procedures in respect of the related party transactions are legal and complied with relevant regulations and the provisions of the Articles of Association.

- 42 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

On 27 November 2020, the thirteenth meeting of the fourth session of the Board considered and approved the Resolution on the Agreement to Appoint Hua Ying Securities as

Lead Underwriter for the Public Issuance of Corporate Bonds of Guolian Group in 2020（《關於同意華英證券擔任國聯集團2020年公開發行公司債券牽頭主承銷商的議案》）. The independent Directors of the Company expressed the following independent opinions: The

approval and voting procedures of the resolution were in compliance with the requirements of the laws and regulations, regulatory documents and the Articles of Association. The related Directors had abstained from voting according to requirements when the Board conducted the voting on the aforesaid resolution, which was in compliance with the requirements of the laws and regulations and the Articles of Association. The voting results were legal and valid. The above related party transactions have complied with the principle of voluntariness, openness and integrity, with fair and reasonable trading terms and were on normal commercial terms, in the interest of the Company and its Shareholders as a whole, and beneficial to the development of the investment banking business of the Company. Therefore, they were normal and necessary transaction activities and without any impact on the Company's independence or circumstances that are detrimental to the legitimate interests of the Company and other Shareholders. The aforesaid related party transactions were approved by all independent Directors.

On 18 December 2020, the fourteenth meeting of the fourth session of the Board considered and approved the Resolution on Entering into Framework Agreement of

Continuing Connected Transactions with Guolian Group and the Determination of the Annual Cap（《關於與國聯集團簽署持續性關連交易框架協議並確定年度上限的議案》）. The independent Directors of the Company expressed the following independent opinions: The approval and voting procedures of the resolution were in compliance with

the requirements of the laws and regulations, regulatory documents and the Articles of Association. The related Directors have abstained from voting according to requirements when the Board conducted the voting on the aforesaid resolution, which was in compliance with the requirements of the laws and regulations and the Articles of Association. The voting results were legal and valid. The various related party transactions agreed in the related party transactions framework agreement are the daily operation business of the Company and Wuxi Guolian Development (Group) Co., Ltd. and its associates (as defined under the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited) with fair and reasonable pricing and trading principles and were on normal commercial terms, in the interest of the Company and its Shareholders as a whole, and without any impact on the Company's independence or circumstances that are detrimental to the legitimate interests of the Company and other Shareholders. The aforesaid related party transactions were approved.

- 43 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

Nomination and Remuneration of Senior Management

On 21 February 2020, the 6th meeting of the fourth session of the Board considered

and approved the Resolution on Remuneration Distribution of Directors and Senior Management of Guolian Securities for the Year 2019（《國聯證券2019年度董事、高管薪酬分配議案》）. All independent Directors reviewed the above resolution and related documents, and considered that the remuneration distribution plan of Directors and senior

management of the Company for the year 2019 was in line with the industry remuneration standard as well as the actual operation and the assessment methods and remuneration system of the Company, which are beneficial to its long-term development.

On 27 August 2020, the tenth meeting of the fourth session of the Board considered and approved the Resolution on the Change of Compliance Director（《關於合規總監變更的議案》）, which approved to nominate Mr. Dai Jiechun（戴潔春）as the chief compliance officer of the Company. All independent Directors reviewed the above resolutions and related

documents, and considered that the procedures for the nomination and appointment of chief compliance officer of the Company were in conformity with the relevant requirements of the Company Law, Securities Law, the Articles of Association and the Measures for Compliance

Management of Securities Companies and Securities Investment Fund Management Companies（《證券公司和證券投資基金管理公司合規管理辦法》）. According to the biographical information of the nominees, there was no circumstance of violation of

relevant laws and regulations such as the Company Law, Securities Law, the Articles of Association and the Measures for Compliance Management of Securities Companies and Securities Investment Fund Management Companies by the nominee, nor was there any circumstances of being prohibited from participating in the market by the CSRC where such prohibition is yet to be discharged. The professional background, working experience and professional competence as well as performance commitment of the nominee were qualified for the requirements of responsibilities of the Company's chief compliance officer, which is beneficial to the development of the Company. Therefore, the above resolutions were approved.

- 44 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

Engagement or Change of Accounting Firms

On 21 February 2020, the 6th meeting of the fourth session of the Board considered

and approved the Resolution on the Re-appointment of Audit Institution of the Company for the Year 2020（《關於續聘公司2020年度審計機構的議案》）. All independent Directors agreed to reappoint Deloitte Touche Tohmatsu and Deloitte Touche Tohmatsu Certified

Public Accountants LLP as the annual audit institutions of the Company, to responsible for providing relevant audit and review services according to International Financial Reporting Standards and Accounting Standards for Business Enterprises of the PRC respectively, and this resolution was submitted to the Company's general meeting for further consideration.

Cash Dividend and Other Investors' Return

On 21 February 2020, the 6th meeting of the fourth session of the Board considered

and approved the Profit Distribution Plan of Guolian Securities Co., Ltd. for the Year 2019 （《國聯證券股份有限公司2019年度利潤分配預案》）, which approved that no profit would be distributed for the year 2019 in view of the Company's issuance and listing related

works are steadily pushing ahead, taking into comprehensive consideration of various factors such as long-term benefits, sustainable development and interests of Shareholders of the Company and that resolution was considered and approved by the general meeting. Each of the independent Directors considered that the Company has been implementing a continuous and stable profit distribution policy since its listing and that the profit distribution plan for the year 2019 had demonstrated the principle that the Company attached great importance to the reasonable investment return to investors and the actual operation and sustainable development of the Company, and there are no circumstances that are prejudiced to the interests of the Company and Shareholders as a whole. The profit distribution plan is in compliance with the requirements of the Articles of Association.

Fulfilment of Commitments by the Company and its Shareholders

The commitments of the Company and its Shareholders are fully disclosed in the Company's prospectus and relevant periodic reports. In 2020, the Company and its Shareholders strictly complied with relevant laws and regulations, and there was no violation of the commitments.

- 45 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

Implementation of Information Disclosure

In 2020, the Company strictly complied with the relevant requirements of information disclosure to ensure the truthfulness, accuracy, completeness, timeliness and impartiality in the disclosure of information. There was no false record, misleading statement or major omission, which secured the interest of investors and enhanced the transparency of the Company.

Implementation of Internal Control

The sixth meeting of the fourth session of the Board considered and approved the

Internal Control Self-AssessmentReport of Guolian Securities Co., Ltd. for the Year 2019 （《國聯證券股份有限公司2019年度內部控制的自我評價報告》）.

In 2020, the internal control system of the Company works well and there is no existence of any major defects. There was no occurrence of irregular action, nor was it exposed to major administrative penalty or public censure by the CSRC or the stock exchanges. The Directors, Supervisors and senior management of the Company were free from any penalty or public censure by the CSRC or the stock exchanges.

External Guarantee and Funds Appropriation

During the reporting period, there was no external guarantee provided by the Company or funds appropriation by the controlling Shareholders and other related parties.

Operation of the Board and Its Special Committees

There are four special committees established under the Board of Directors of the Company, namely Audit Committee, Remuneration and Nomination Committee, Risk Control Committee and Strategy Committee, and all the 3 independent Directors are members of the special committees. In 2020, each of the special committee of the Company reviewed the matters regarding the strategic development, annual report, related party transaction, staff appointment and remuneration assessment, internal control report of the Company in accordance with the requirements of related working rules, and put forward corresponding proposals to the Board.

- 46 -

APPENDIX IV	DUTY REPORT OF THE INDEPENDENT
	DIRECTORS FOR THE YEAR 2020

Use of Proceeds Previously Raised

The Company issued 475,719,000 RMB ordinary shares (A Shares) at an issue price of RMB4.25 per share on the Shanghai Stock Exchange in July 2020 for a total amount of RMB2,021,805,750.00, after deducting the remaining underwriting sponsorship fee of the co-lead underwriter and other issuance fees paid by the Company prior to the issuance, the actual net proceeds raised were RMB1,938,084,540.00.

The proceeds above were fully received on 27 July 2020 and have been verified by Deloitte Touche Tohmatsu Certified Public Accountants LLP and issued the Deshibao (Yan) Zi (20) No. 00324 Capital Verification Report. As of 31 December 2020, the proceeds previously raised by the Company have been fully used, and the relevant bank accounts of the proceeds have no balance and have all been cancelled.

The deposit and use of the proceeds previously raised of the Company has complied with relevant laws, regulations and departmental provisions. All proceeds have been used to replenish capital, increase operation capital and develop the main business. There exists no change in investment projects of proceeds, and the use is consistent with the contents of the information disclosure documents of the Company.

IV. OVERALL EVALUATION AND SUGGESTIONS

All independent Directors had complied with the relevant requirements under the laws, regulations, Articles of Association and the Independent Director System of the Company, and had adequate time and commitment to perform their duties during their terms of office. They were not affected by the substantial Shareholders of the Company and other interested units or individuals of the Company when making their independent judgments in the decision-making of the Company and had protected the legitimate interest of the Company and the Shareholders.

In 2021, all independent Directors will continue to fulfill their duties faithfully and diligently, and fully devote their roles as independent Directors to safeguard the overall interest of the Company and the legitimate rights and interests of all Shareholders and promote the sustainable and healthy development of the Company.

- 47 -

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Guolian Securities Co. Ltd. published this content on 31 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 March 2021 08:17:03 UTC.

Market Closed - Hong Kong S.E. Other stock markets 01:38:22 10/05/2024 pm IST			5-day change	1st Jan Change
4.15 ^HKD	+4.80%		+6.96%	+20.99%

01/05	Guolian Securities Swings to Loss in Q1 as Revenue Drops 74%	MT
29/04	Guolian Securities Co., Ltd. Reports Earnings Results for the First Quarter Ended March 31, 2024	CI

Guolian Securities Swings to Loss in Q1 as Revenue Drops 74%	01/05	MT
Guolian Securities Co., Ltd. Reports Earnings Results for the First Quarter Ended March 31, 2024	29/04	CI
News Highlights : Top Financial Services News of the Day - Monday at 12 AM ET	29/04	DJ
News Highlights : Top Financial Services News of the Day - Friday at 4 PM ET	27/04	DJ
News Highlights : Top Financial Services News of the Day - Friday at 11 AM ET	26/04	DJ
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Hong Kong Shares Extend Rally on Upbeat Earnings, China Stimulus; Guolian Securities Surge 25%	26/04	MT
News Highlights : Top Company News of the Day - Friday at 3 AM ET	26/04	DJ
Chinese Financial Services Shares Gain on Consolidation Hopes	26/04	DJ
Guolian Securities to Acquire Controlling Stake in Minsheng Securities	26/04	CI
Guolian Securities' 2023 Profit Falls 12.5% Despite 12% Revenue Growth	27/03	MT
Guolian Securities Co., Ltd. Proposes Final Dividend for the Year Ended 31 December 2023	26/03	CI
Guolian Securities Co., Ltd. Reports Earnings Results for the Full Year Ended December 31, 2023	26/03	CI
Market reaction to China's 2024 economic targets	05/03	RE
China sets 5% growth target for 2024, work report shows	05/03	RE
Rare earths prices seen rebounding in second half of 2024 -analysts	05/02	RE
Guolian Securities Renews Property Lease, Financial Service Contracts for 3 Years	28/12	MT
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Guolian Securities Co., Ltd.(SHSE:601456) dropped from SSE 180 Index	08/12	CI
Guolian Securities Co., Ltd.(SHSE:601456) dropped from Shanghai Stock Exchange 180 Value Index	08/12	CI
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Guolian Securities Posts Near 39% Drop in Q3 Profit	30/23/30	MT

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GUOLIAN SECURITIES CO., LTD.	+20.99%	3.69B
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