Huishang Bank Corporation Limited has released revised Terms of Reference for its Board Audit Committee, aligning the mandate with the Company Law of the People’s Republic of China, the Corporate Governance Standards for Banking and Insurance Institutions and the Hong Kong Listing Rules.

Key governance enhancements include:

• Committee Composition – Minimum of three non-executive directors, with a majority being independent non-executive directors. – At least one member must possess professional qualifications in finance or accounting; other members are required to bring expertise in audit, finance, accounting or law. – The convener and chair must be an independent non-executive director.

• Expanded Responsibilities – Oversight of internal controls, risk management implementation and information disclosure. – Review of annual, interim and quarterly financial statements prior to Board consideration. – Direct responsibility for recommending the appointment, re-appointment or replacement of external auditors and assessing their independence. – Authority to supervise the conduct and performance of directors and senior management, and to recommend disciplinary action or legal proceedings when necessary. – Power to propose and convene extraordinary Board or shareholder meetings if governance issues arise.

• Operating Procedures – The committee must meet at least twice annually and report to the Board on a quarterly basis. – Meetings are quorate with more than half of members present; resolutions pass by simple majority. – Members must attend at least two-thirds of meetings each year, with the chair required to devote a minimum of 20 working days annually to committee duties.

• Effective Date – The revised Terms of Reference take effect upon approval by the Board of Directors, replacing the previous version in its entirety.

Huishang Bank expects the updated framework to reinforce audit quality, enhance transparency in financial reporting and ensure rigorous oversight of internal and external audit functions.