IntroductionBackgroundIndustrial and Commercial Bank of China (short as “ICBC” or “the Bank” hereinafter) hasbeen consciously integrating the social responsibilities into its development strategy,operation and management activities, gaining wide social recognition in the aspects ofsupporting targeted poverty relief, protecting environment and resources, participating insocial and public welfare undertakings, and promoting inclusive finance.

ICBC has built its Corporate Social Responsibility Model on six dimensions, namelyValue Creator, Brand Bank, Green Bank, Integrity Bank, Harmonious Bank and CharityBank, based on which the Bank has been making constant efforts to facilitate manyimportant initiatives such as targeted poverty relief, supply-chain reform, Belt and Roadinitiative, and green finance.

ICBC was the first Chinese commercial bank to join the UN Global Compact in 2012and joined the United Nations Environment Programme Finance Initiative ("UNEP FI") in2014. In China, ICBC is a member of the standing council of Green Finance Committeeestablished under China Financial Forum. ICBC has been an active advocate of greenfinance both nationally and internationally as a social and environmental commitment.

The Green Bonds issued by ICBC will be a further elaboration of the Bank’s consistentgreen strategy and will also facilitate China’s ecological progress. These Green Bondswill further boost ICBC as a Group in its development strategies related to sustainabilityand climate change. ICBC Green Bond Framework will be a further step in supportingICBC investors to meet their objectives in the fast-growing green economy.

ICBC has built its Corporate Social Responsibility Model on six dimensions

ValueCreator2BrandBankICBC Green Bond Annual Report 2017GreenBankIntegrityBankHarmoniousBankCharityBankGreen Finance PracticeICBC actively implements green finance by cultivating the green bond market and advancingthe green credit progress.

Green Bondsas an active response to the national initiative of energy saving and emission reduction toprotect the environment, ICBC tapped the green bond market by issuing the first “Belt andRoad” climate bondunderwriting

11green bonds

ICBC has been awarded“OutstandingUnderwriter in 2017”

thefor Green Bonds CompositeIndex Issuances by China CentralDepositary & Clearing Co., LTD.

a total size of RMBranking

54.3NO.1billion yuanamong all underwritingbanks in China

ICBC has been an activeinvestor in green bonds witha portfolio balance of RMB

20.19

billion yuan

Green CreditICBC has deepened the five major concepts for national development featuring “innovative, coordinated, green, opendevelopment that delivers benefits to all”, and followed the overall plan to seek economic, political, cultural, social andecological progress. Green credit building, as an important long-term strategy for the Bank, has been advanced inall aspects including credit policies, administrative procedures, credit business innovation, and the Bank’s own greenperformance, in order to provide active support for green sectors, strengthen controls on environmental and social risks,and advocate low carbon operations, to realize the all-round improvement in economic, social and ecological benefits.
By 2017, ICBC has kept a loan portfolio of RMB 1099.199 billion yuan togreen sectors including ecological preservation, clean energy, energy-savingand environmental protection, and resource recycling, with a y-o-y growthof RMB 120.639 billion yuan, 3.5 percentage points higher than the averagegrowth rate in corporate loans.

with a y-o-y growth of RMBloan portfolio of RMB

1099.19billion yuan

3.50

120.639billion yuan

percentage pointshigher than theaverage growth rate incorporate loans

Industrial and Commercial Bank of China Limited

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Green Bonds Issued by ICBC by the end of 2017On September 28th 2017, ICBC issued through LuxembourgBranch the first “Belt and Road” climate bonds (hereinaftershort as “the Green Bonds”), receiving warm recognition andoversubscription by the international investors. The Bondsinclude three tranches with a total volume of over USD 2.15billion dollars.

a total volume of over USD

2.15

billion dollars

ICBC Green Bonds Issued by the end of 2017

Issuer rating

A1 / A / A (Moody’s/S&P/Fitch)

Issue rating

A1 (Moody’s)Issue typesenior unsecured bonds

Issue format

Reg S

ISIN

XS1691909334

XS1692890343

XS1691909177

TrancheEUR 3Y FRN

USD 3Y FRN

USD 5Y FXDSizeEUR 1,100,000,000

USD 450,000,000

USD 400,000,000

Use of proceeds

To finance or refinance “Eligible Green Assets” in accordance with certain prescribedeligibility criteria as described under the ICBC Green Bond Framework, includingrenewable energy, low carbon and low emission transportation, energy efficiencyand sustainable water and wastewater management in countries and regions along

Second opinionprovider

the “Belt and Road” initiative.

CICERO Center for International Climate Research (“CICERO”). The ICBC GreenBond Framework obtained a Dark Green shading rating from CICERO, which is thehighest level by CICERO’s standard.

External reviewopinion provider

Zhongcai Green Financing Consultants Ltd. (“Zhongcai Green Financing”).
Zhongcai Green Financing issued an external review assessment report for theICBC Green Bond Framework against Chinese standards.

CBI certification

The Bond obtained the Climate Bonds Initiative Certification by Climate BondsInitiative (CBI) on 26 September 2017.

Listing venue

4Luxembourg Stock Exchange LGXICBC Green Bond Annual Report 2017

Awards111

The 1st bond aligned withthe latest international andChinese domestic green bondstandards, with the highest“dark green shading” fromCICERO, the internationallyrenowned second partyopinion provider

The 1st bond issued by aChinese financial institutioncertified as “Climate Bonds” byClimate Bonds Initiative

The 1st green bond dedicatedto green projects in China’s“Belt and Road” initiative

ststst

The Green Bonds also mark the largest single issuance in EUR tranche by a Chinese financial institution as ofSeptember 2018 when the Report was prepared.

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5awards have been received, namely:2017 Best ESGDeal1

2017 Best SRIBond 2by FinanceAsia

by IFR Asia

2017 Bond of theYear for Innovationin Use ofProceeds42017 AsiaPacific Green /SRI Bond Dealof the Year5

by Environmental Financeby GlobalCapital2017 Regional andDeals Award: BestGreen Bond 3

1.https://www.financeasia.com/News/441270,winners-emfinanceasiaems-achievement-awards-part-2.aspx2.http://www.ifrasia.com/sri-bond/21320981.article3.https://www.theasset.com/awards/regional-deals-2017-fixed-income4.https://www.environmental-finance.com/content/awards/green-bond-awards-2018/winners/award-forinnovation-use-of-proceeds-icbc.html5.https://www.globalcapital.com/article/b19tcwdcbrq2ks/sri-award-winners-2018-revealed

6

ICBC Green Bond Annual Report 2017

by The AssetManagement of ProceedsUse ofProceeds

ICBC has developed the Green Bond Framework (hereinafter short as “theFramework”) under which it plans to issue green bonds, to finance and refinance,in whole or in part, eligible green assets promoting the transition to low-carbon andsustainable economy with clear environmental sustainability and climate changebenefits. The eligible green asset categories are described with examples below.

“Eligible Green Asset Categories “for ICBC

RenewableEnergy

Low Carbonand LowEmissionTransportation

Description and Examples

Generation and transmission of energy from renewable energy sources.
Renewable energy sources include offshore and onshorewind, solar, tidal, hydropower subject to conditions, biomassand geothermalLow energy or emission transportation assets, systems, infrastructure,components and services excluding any infrastructure or rolling stockassets used for the transportation of fossil fuel productsExamples include Rail Tram, Metro, Bus Rapid Transit Systems,Electric VehiclesDevelopment of products or technology and their implementation that reducesenergy consumption of underlying asset, technology, product or system(s)EnergyEfficiency

Examples include LED lights, improved chillers, improved lightingtechnology, and reduced power usage in manufacturing operationsImproved efficiency in the delivery of bulk energy servicesExamples include district heating/ cooling systems, smartgrids, and transmission and distribution of energy that results inreduced energy losses

SustainableWater andWastewaterManagement

Water collection, treatment, recycling, re-use, technologies andrelated infrastructureExamples include water pipes and collection facilities to collectwater/rainwater, dams, treatment plant facilities

For the avoidance of doubt, in any case, the Eligible Green Assets shallexclude below：Exclusion

fossil fuel related assetsLarge scale hydropower plantsNuclear and nuclear-related assets

Note: Assets in all eligible categories shall at least reach the threshold of relevant official standards of environmental impacts recognized in the localjurisdictions. In case of no official standards locally recognized, corresponding international standards shall apply.

Industrial and Commercial Bank of China Limited

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Project Evaluation and Selection

12

Eligible Green Assetswill firstly be identifiedand proposed byICBC business unitsglobally, includingits subsidiaries andbranches.

They will then be reviewedby a dedicated greenbond working group atICBC Head Office “(theGreen Bond WorkingGroup) composed ofmultiple departments”

Prior to the issuance

The Green BondWorking Groupwill review allproposed EligibleGreen Assets

Eligibility criteriais reviewed incompliance withthe ICBC GreenBond Framework

Approval isgranted foreach “EligibleGreen Asset”

an “eligible green assetlist” is formed (each“Eligible Green Asset”,collectively the “EligibleGreen Asset Lists”)

In the Green Bond Working Group, representatives shall be nominated if they have environmental experience andknowledge. The experts with environmental experience and knowledge enjoy a veto power to the final decision on theselection. The assets vetoed by them shall be excluded from the Eligible Green Asset List.

Annually, the Green Bond Working Group will review the allocation of the proceeds to the Eligible Green Asset Listand determine if any changes are necessary (for example, if a project has amortized, been prepaid, sold or otherwisebecome ineligible) and facilitate ongoing reporting. The Green Bond Working Group will decide any necessary update ofthe Eligible Green Asset List (such as replacement, deletion, or addition of projects) to maintain the eligibility of the Useof Proceeds.

Management of ProceedsThe proceeds of the Green Bonds issuance have been fully deposited by ICBCLuxembourg Branch in the general funding accounts of ICBC Head Office in an“earmarking” approach, who established the Green Bond “allocation register” to recordthe allocation of Green Bond proceeds.

8ICBC Green Bond Annual Report 2017

External AssuranceExternal AssuranceStandards

CertifierAssurance (Abstracts from Reports)“Based on an overall assessment of the activitiesthat will be financed by the green bond and thegovernance of the framework, ICBC’s GreenBond Framework is awarded the Dark Greenshading.”“We conclude that:1.The use of proceeds and applied projects listedout in ICBC’s Green Bond Framework complieswith the Green Bond Principles 2017 issued byInternational Capital Market Association2.It also complies with Guidelines for Establishingthe Green Financial System(Yinfa2016DocNo.228)
3.No findings showed that it does not complywith Green Bond Categories 2015 issued by thePeople’s Bank of China”“…on 26 September 2017, the Climate BondStandards Board approved the certification of theproposed inaugural Climate Bonds to be issuedby the Applicant’s EMTN Programme (the bond),as per the application documents and verificationreport provided by Industrial and CommercialBank of China Ltd. Luxembourg Branch.”

Industrial and Commercial Bank of China Limited

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Allocation of ProceedsAllocation OverviewThe total funding of USD 2.15 billion raised by the Green Bonds were fullyallocated to refinance renewable energy and low carbon low emissiontransportation projects with an overview below:

Unallocated proceeds

0

USD billion

Total funds raised

21.5Allocated amountUSD billion

21.5USD billion

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ICBC Green Bond Annual Report 2017

Breakdown by Sector and Geography

The Eligible Green Assets fall into the categories of wind power, solar power andrailway transportation, including

4

wind power projects

a total contract size of USD

500

millionan allocation of USD

371

million6

solar power projects

a total contractsize of USD

an allocation of USD

300

259

millionmillion2

railway transportation projects

a total contract

an allocation of USD

size of USD

2.04

billion1.521billion

Industrial and Commercial Bank of China Limited1112

The breakdown by projects is provided below

ICBC Green Bond Annual Report 2017

Category

Wind power

Ref.

Location

Amount Allocated (USD in mio)

Project 1

Jiuquan, Gansu, PRC

1.13

Project 2

Nantong, Jiangsu, PRC

0.95

Project 3Hami, Xinjiang, PRC

0.89

Project 4Hami, Xinjiang, PRC

0.74

Sub-total

Renewableenergy

Solar power

Project 5

Taizhou, Jiangsu, PRC

0.58

Project 6Suqian, Jiangsu, PRC

0.57

Project 7

Ouarzazate, Morocco

1.32

Project 8Saraburi, Thailand0.05

Project 9Saraburi, Thailand

0.03

Project 10

Saraburi, Thailand

0.04

Sub-total

Low-carbon andlow-emissiontransportation

Railwaytransportation

3.17

2.59

Project 11

Yongzhou-GuilinLiuzhou, PRC

4.80

Project 12

Lanzhou-Chongqing, PRC

10.41

Sub-total

Total

15.21

21.50

MajorEnvironmentalAccident orBreachThere have been no environmentaldefaults, breaches or alerts in theEligible Green Assets selected asUoP by the end of 2017.

Environmental ImpactsRenewable energyThe green bonds issued helped to reduce a total CO2emission of 4,186,135 tons per year, including

CategoryRef.

2,720,437 tons per year for renewable energyassets and 1,465,998 tons per year for low-carbonand low-emission transportation.

Wind power

Industrial and Commercial Bank of China Limited

Renewableenergy

Solar power

13

Note: The impacts of renewable energy projects have applied the EIBCarbon Footprint Methodology6http://www.eib.org/attachments/strategies/eib_project_carbon_footprint_methodologies_en.pdf

Total

InstalledCapacity (MW)PowerGeneration peryear (MWh)

GHG EmissionAvoided per year(ton)Project 1

400

920,000

752,100

Project 2

300

740,000604,950

Project 3200

478,800

391,419

Project 4200

400,000

327,000

Project 580

92,80075,864

Project 6100

116,500

95,239Project 7200

730,000

450,045

Project 89.515,8428,563

Project 99.616,130

8,718

Project 107.212,099

6,540

1,506.33,522,171

2,720,437

14

Low-carbon low-emission transportation

ICBC Green Bond Annual Report 2017

Ref.

Category

Project 11

Allocated Amount (mioin USD)

480

Tracks Built orRenovated (km)361.3No. of Shipped Passengers/tons of Cargo per year

11.793 mio passengers

GHG EmissionAvoided per year(ton)818,798

1,270 trillion tons of cargo

Low-carbonand lowemissiontransportation

Project 12Total

1,041

813.91,521

1,175.2Put into use since Sept.
29, 2017, and transported1.872 mio passengersand 6.37 mio tons ofcargo

647,200

1,465,998

Note: The impacts of low-carbon low-emission transportation have applied the index for railway sector in PRC in IEA-UIC Energy and CO2 Railway Handbook[ https://uic.
org/IMG/pdf/handbook_iea-uic_2017_web3.pdf] as well as the EIB Carbon Footprint Methodology.

Examples of Eligible Assets

Example 1: Project 2 (renewable energy – wind power)

It is an offshore wind power project located 23 km away fromthe coastline of Jiangsu Province in P. R. China. The windturbine has a total capacity of 300 MW with 75 units (4 MWper unit). The annual power output is 7,400,000 MWh, runningat full capacity equaling to 2467 hours for GEAH (GeneratingEquipment Availability Hours) annually. Each year, reductioncan be made by 605,000 tons in CO2 emission, and by 92,000tons in lime ash emission, and 24000 tons in soot emission.
2.197,000 m3 of water can be saved. Environmental impactsare therefore significant.

The annual power output is740,000

MkWh

Each year, reduction can be made by605,000

92,00024000

in CO2 emission

in lime ash emission

in soot emission.

tons

tons

tons

Example 2: Project 11 (low carbon and low emission transportation)It is a railway transportation project with the main line of 350.85km in length and full line running for 361.30 km. It is a level 1railway line powered fully by electricity, designed for a runningspeed of 200 km/h. The project can shorten the travel timefrom Guilin to Liuzhou from more than 2 hours to 1 hour only,with a yearly transportation capacity of 11,793,000 passengersand 12,700,000 tons of cargo. Each year, the CO2 emissioncan be reduced by 819,000 tons. This project can effectivelyprovide a fast transportation solution with a big capacity to thesurrounding region, and ease the transportation pressure. Itplays an important role in boosting the fast development in localeconomy to strengthen its competitiveness in the Asia-Pacificregional market.

Each year, the CO2 emission canbe reduced by819,000

tonsa yearly transportation capacity of

11,793,000

passengers

12,700,000

tons of cargo

Industrial and Commercial Bank of China Limited15

Disclosure and ReportingICBC has engaged CICERO to act as an external reviewer of this Green BondFramework for GBP alignment and Zhongcai Green Financing Consultants Ltd. to actas an external reviewer of this Green Bond Framework for Chinese domestic standards.
The Second Party Opinions by CICERO and Zhongcai Green Financing ConsultantsLtd. are publicly available on ICBC official global website www.icbc-ltd.com.

ICBC will engage an independent third party to provide assurance on its Annual GreenBond Report which will provide information on allocation and impacts.

16

ICBC Green Bond Annual Report 2017

Industrial and Commercial Bank of China Limited17