===== CMS's earnings conference revealed "information": The number of new accounts opened at CMS in October increased several times. =====

On November 18th, CMS held a performance briefing for the third quarter of 2024.

Executive Director and President Eddie Wu, Vice President (Financial Officer) and Board Secretary Liu Jie, Independent Directors Ye Yingzhi, Zhang Ruijun, Chen Xin, Cao Xiao, and Feng Jinhua attended the meeting.

Although CMS has often been mentioned in the context of "system failures" and being stuck in the market, according to management's response, influenced by market conditions, the number of new accounts opened by the company in October increased several times compared to September. This is enough to demonstrate the enthusiasm of the market.

In addition, management also responded to questions regarding mergers and acquisitions, investment income, and management expenses.

Account Growth Increased Several Times

Regarding the situation of new account openings since the 924 market, and which business segments benefited significantly, Executive Director and President Eddie Wu stated that, influenced by market conditions, the number of new accounts opened by the company in October increased several times compared to September.

Recently, the A-share market has shown significant volume, with trading volume of stock funds in October increasing substantially compared to September; the recent rise in market enthusiasm has positively promoted the company's brokerage business. The company will continuously enhance the comprehensive competitiveness of its brokerage business and promote long-term high-quality development.

Currently, the Company Has No Undisclosed Merger Information

Regarding the surge in mergers and acquisitions in the brokerage industry, whether CMS has any merger plans, Executive Director and President Eddie Wu stated that the Central Financial Work Conference proposed to build first-class investment banks and investment institutions. The new "National Nine Articles" from the State Council and the CSRC's "Opinions on Strengthening the Supervision of Securities Companies and Public Funds to Accelerate the Construction of First-Class Investment Banks and Investment Institutions (Trial)" encourage leading institutions to optimize and strengthen through mergers and acquisitions, organizational innovation, etc.; and encourage small and medium-sized institutions to develop differentiated and specialized operations.

Mergers and acquisitions are an important means to achieve growth and strength. Through mergers and acquisitions, capital expansion and customer resource integration can be realized, accelerating the ability to serve the goal of building a strong financial nation. The company will continue to track and study relevant opportunities for industry mergers and acquisitions. Currently, the company has no undisclosed information that should be disclosed.

Implementing a "Large and Stable" Investment Strategy

Regarding specific investment income projects, Executive Director and President Eddie Wu introduced that in the first three quarters of 2024, the company continued to implement a "large and stable" investment strategy, strengthening asset allocation, coordinating investment business resource allocation, investment decision-making, and risk management from top to bottom, and timely adjusting and optimizing the investment structure according to changes in market conditions, continuously improving business strategies, and effectively enhancing investment income and income stability.

Promoting a Series of Cost Reduction and Efficiency Improvement Measures

As for management expenses, regarding future control plans and cost reduction measures, as well as whether there are strict management systems and measures for the compensation and integrity control of senior executives, Eddie Wu also stated that in the first three quarters of 2024, the company's business and management expense ratio (business and management expenses / operating income excluding other business costs) was 47.31%, a decrease of 0.1 percentage points year-on-year, with an ROE of 6.12%, ranking third among listed brokerage firms The company is advancing a series of cost reduction and efficiency enhancement measures. First, it is promoting the transformation of budget management, implementing refined dynamic budget control based on time progress and revenue progress, shifting the focus from budget forecasting to resource allocation, categorizing expense management to ensure that key expenses are adequately supported while firmly compressing general expenses. Second, the company conducts in-depth analysis of various expenses and their driving factors, taking targeted cost reduction measures. The company's cost reduction and efficiency enhancement efforts have been significant, with business and management expense ratios consistently maintained at a lower level compared to leading benchmark securities firms.

The company has established the "Senior Management Personnel Compensation Management Measures," implementing a performance-based compensation incentive mechanism for senior management, with remuneration determined based on position and performance linkage. The company has also formulated the "Management Measures for Integrity in Employment of Staff at China Merchants Securities Co., Ltd.," which clearly stipulates that the board of directors determines the integrity management goals and overall requirements, and is responsible for the effectiveness of integrity management. Senior management is responsible for implementing integrity management goals and is accountable for integrity operations. Responsible persons at all levels should strengthen integrity management for staff in their departments, branches, or subsidiaries, and bear corresponding management responsibilities within their scope of duties. The supervisory board or supervisors oversee the performance of integrity management responsibilities by directors and senior management