Poverty Alleviation of Agricultural Bank of China

　　【Overview】 For a long time, Agricultural Bank of China has been shouldering the responsibility of issuing pro-poor discount loans to help lift poor people out of poverty and get more income. In 2008, the State Council issued the "Notice on A Comprehensive Reform of the Pro-poor Discount Loan Management System" (Guo Fa [2008] No. 29) and clearly stated that pro-poor discount loans could be issued by any financial institution without the need to issue guidance program. To adapt to this change, Agricultural Bank of China introduced the "Financial Service Program of Agricultural Bank of China for ‘Three Rural’ Issues in Impoverished Counties", which clarified the key areas for the services, formed the philosophy of “great pattern of poverty alleviation”, targeting at national and provincial key counties for poverty alleviation and development, established the new idea for poverty relief credit loan issuance of targeting at “two zones and one kind of clients”, that is, targeting at 592 national key counties and 404 provincial key counties for poverty alleviation and development, and mainly serving 625 poverty alleviation leading enterprises, explored models for agricultural industrialization to promote poverty  alleviation, rural infrastructure construction to support poverty relief and eco-tourism to accelerate the “green poverty alleviation”, developed featured resources and fostered pillar industries to lift the farmers in impoverished regions out of poverty and get rich through industrial development. In 2010, Agricultural Bank of China conscientiously fulfilled the social responsibility as a state-owned commercial bank. In order to boost the economic development in impoverished areas, increase income of poor households and ensure the safety of credit loans, adhering to the "development-oriented, industrialization and commercial" poverty alleviation and cost-effective principle, Agricultural Bank of China combined the commercial benefits with poverty reduction effect, actively explored effective approaches to poverty alleviation by issuing credit loans to lift farmers out of poverty, innovated products and service models, constantly increased financial services for poor counties to improve the hematopoietic function of poverty-relief funds and support the implementation of Microfinance projects of China Foundation for Poverty Alleviation, and actively implemented pilot micro-credit loans and provided a certain amount of wholesale loans for four small microcredit organizations to issue to poor farmers in poverty-stricken counties for development of production. As of the second quarter of 2010 (due to the credit system updates of Agricultural Bank of China, data of third and fourth quarter are unavailable), Agricultural Bank of China issued a total of 165.481 billion Yuan for national and provincial key counties for poverty alleviation and development, with an increase of 53.291 billion Yuan, up 47.5%; and issued pro-poor discount loans of 1.082 billion Yuan for poor areas, with an increase of 512 million Yuan, up 89.8%. Meanwhile, the loan balance of Agricultural Bank of China in the two kinds of poor counties reached 351.776 billion Yuan, with an increase of 117.317 billion Yuan, up 50.04%, which helped 2.6588 million impoverished households to increase income, averagely 6038.42 Yuan per household.

　　【Support for leading enterprises】 In accordance with the standard of “boosting the economic development of impoverished areas and helping to improve the production and living conditions of poor farmers” and the cost-effective principle, Agricultural Bank of China actively adjusted the credit structure and raised anti-poverty funds through various channels, which greatly supported the development of leading enterprises of agricultural industrialization. Through helping farmers by companies and project construction and encouraging farmers by economic benefits, it effectively expanded the coverage of pro-poor loans and improved the use efficiency of pro-poor loans. Within the jurisdiction of Agricultural Bank of China in Henan Province, for example, 6,560 agriculture organizations of industrialized operation in compliant with the statistics standard of Ministry of Agriculture helped 8.97 million rural households to increase income by 986 Yuan per household per year. 2521 of the 6560 agricultural industrialization enterprises are leading enterprises, including 39 national key enterprises and 562 provincial key leading enterprises. Agricultural Bank of China in Henan Province provided key support for 26 key national leading agricultural industrialization enterprises and more than 300 key provincial leading agricultural industrialization enterprises using the model of "company + base + farmers". It issued more than 3 billion Yuan for the agricultural industrialization leading enterprises and achieved good social benefits. By supporting the development of agricultural industrialization leading enterprises, it created a number of brand-name products with a certain influence at home and abroad such as "Huaying" duck, "Dayong" chicken, "Jinyuan" flour, "Sanquanling" rice dumpling, "Sinian" dumpling, "Lotus" aginomoto, "Shuanghui" ham and so on. In 2010, Agricultural Bank of China in Henan invested 84.67 million Yuan of pro-poor discount loans to support more than ten agricultural industrialization leading enterprises such as Wuyun Tea, Sanquan Food, Huaying and Kedi Group, which helped more than 20,000 households and over 50,000 poor farmers increase income.

　　【Support for micro-credit organizations】 In 2010, Agricultural Bank of China actively gave play to its advantage of organization, branches and network as a state-owned commercial bank, innovated the way of pro-poor credit loan issuance and actively implemented pilot financing projects of "pro-poor microcredit organizations". On January 20, 2010, Agricultural Bank of China and the four pro-poor microcredit organizations signed a cooperation agreement at the Great Hall of the People in Beijing, which was an in-depth exploration for financial service models in impoverished areas by large commercial banks. Vice Chairman of NPC Standing Committee Hua Jianmin, Vice Chairman of Financial and Economic Committee Wu Xiaoling and Vice President of the Chinese Academy of Social Sciences Wu Yin attended the signing ceremony. According to the agreement, Agricultural Bank of China shall cooperate with Hebei Yi County Pro-poor Economic Cooperatives, Hennan Nanzhao Pro-poor Economic Cooperatives, Guizhou Xingren County Rural Development Association and Qinghai Tongren County Rural Development Association (four pro-poor micro-credit organizations) and provide a certain amount of wholesale loans for the four micro-credit organizations to issue to poor farmers in poverty-stricken areas for the development of production.

　　Hebei Yi County Pro-poor Economic Cooperatives (hereinafter referred to as Yi County Pro-poor Economic Cooperatives) is one of the pilot microfinance organizations for poverty alleviation. On August 6, 2010, Agricultural Bank of China Hebei Branch issued 1 million Yuan of wholesale loans to Yi County Pro-poor Economic Cooperatives, which effectively increased the operating funds of the Cooperatives. The issuance of the loans solved the funding problem of more than 3,000 poor rural households in shaking off poverty and lifted over 1,800 poor households out of poverty.

　　Agricultural Bank of China Nanzhao Subbranch issued 2 million Yuan of credit loans to Nanzhao Pro-poor Economic Cooperatives. In order to make the Pro-poor Economic Cooperatives issue the loans to farmers as soon as possible, relevant leaders of Agricultural Bank of China Henan Branch negotiated with Nanzhao Pro-poor Economic Cooperatives for many times, personally helped it to address the loan guarantee problem, gave play to its personnel advantage and contacted Nanyang Centre for SME Guarantee and Nanyang City Public Investment Guarantee Corporation to provide financial guarantees.

　　After issuing 200 million Yuan of credit loans to China Foundation for Poverty Alleviation in October 2009, in 2010, Agricultural Bank of China issued three loans of 180 million Yuan to China Foundation for Poverty Alleviation. After that, the leaders attached great importance to the microcredit project operation. In the middle of the year, the account manager team went to Pingquan County and Wanquan County of Hebei Province as well as Mentougou District of Beijing to conduct field survey on the implementation of microcredit project of China Foundation for Poverty Alleviation and the credit needs. Now, Agricultural Bank of China has issued a total of 180 million Yuan of working capital loans to China Foundation for Poverty Alleviation, which greatly promoted the development of micro-credit projects.

　　In the exploration and practice of various places, Agricultural Bank of China Sichuan Branch issued loans of 200,000 Yuan to Yilong County Rural Development Association and Zhangyemiao Village Pro-poor Mutual Funds based on the pilot projects of expanding village-level mutual funds in impoverished villages of Sichuan Province. It was a small amount of loan, but played a demonstration role in pilot work. Now, the project construction goes on smoothly.

　　【Innovation in micro-credit for poverty alleviation】 Agricultural Bank of China, with innovative products, provides quality financial services for most of the clients, especially those in impoverished counties. Its 2 innovative products - “Rural Infrastructure Construction Loan” and “Green Home Loan” promoted the improvement of the infrastructure and hardware environment in impoverished areas. In order to alleviate leading poverty alleviation enterprises’ difficulties in mortgage, pledge and insufficient guarantee sources, it released the “Movable Property Pledge Financing Loan for County-Level SMEs” and “Receivable Pledge Loan for SMEs”, which solved the financing channel and guarantee problem of the enterprises. To effectively promote the development of forest enterprises and solve their financing problem so as to lift the majority of farmers out of poverty, Agricultural Bank of China issued the "Forest Right Mortgage Loan Management Methods", which adapted to the new situation of China’s collective forest right system reform, increased financing channels for forest enterprises to a large extent and solved the loan guarantee problem.

　　【Poverty alleviation by issuing farmer-benefiting cards】 Agricultural Bank of China, with Golden Spike Farmer-Benefiting Card as the carrier and with stress on micro loans, directly helps impoverished farmers to shake off poverty and get rich. As of the end of 2010, Agricultural Bank of China issued 61.85 million farmer-benefiting cards to benefit 240 million farmers, and the balance of petty loans to farmers was 98.9 billion Yuan, covering 5.9 million rural households. By issuing farmer-benefiting cards, Agricultural Bank of China undertook the agent business of new rural social endowment insurance in 484 counties and the agent business of new rural cooperative medical care in 313 counties, and successfully implemented various projects in over 25% of the counties in China.

　　Over the two years since the issuance of farmer-benefiting cards, Agricultural Bank of China shifted the cards’ function from filling the blanks of the financial services in impoverished areas to supporting “three rural” development. In accordance with the requirements of serving “three rural” development and boosting the stable development of farmer-benefiting card business and microcredit for rural households, Agricultural Bank of China Shandong Jining Subbranch seriously studied the financial agriculture-supporting model of “Agricultural Bank of China + farmers’ cooperatives + rural households”. Taking this model, it conducted effective screening of rural households and effective supervision on farmers’ production and capital operation and, combining with the “three rural” products and settlement products, improved lending efficiency and reduced the risk. As of late October 2010, relying on farmers’ cooperatives, it had issued 7,200 farmer-benefiting cards and 160 million Yuan of petty loans to rural households.

　　The provincial branches of Agricultural Bank of China attached important to the role of science and technology in promoting three rural business and many of them successfully developed the farmers’ information database management application system integrating rural and farmers’ information collection, processing, analysis and application, which was a better solution to the specific problems in card issuance, agent business of the new rural social endowment insurance, new rural cooperative medical care and agriculture-benefiting subsidy, and farmers’ loan business expansion, achieving low-cost and high-efficiency financial services for farmers. It effectively addressed the conflict between serious shortage of account managers for three rural business and the heavy workload and was a positive and effective attempt to enhance the capacity of counties for serving three rural business.

　　【Poverty alleviation by social credit】 While providing pro-poor credit loans, Agricultural Bank of China is also involved in social public welfare. With love for the vulnerable, it actively participated in disaster relief, charitable donations, volunteer services and other social welfare activities to fulfill the social responsibility of a large-scale state-owned bank.

　　Agricultural Bank of China always takes it as its obligatory social responsibility to provide quality financial services for the affected areas and to meet the funding needs of disaster-hit areas and people in time. Whenever a disaster happens, it pays close attention to the disaster situation, makes every effort to address problems for government, clients and affected people, makes timely arrangements for disaster relief and devotes itself into financial services for disaster relief and post-disaster restoration and reconstruction. After the earthquake in Yushu of Qinghai Province, for example, the leaders of its rural industrial financial department went to the disaster area at the first time for field survey, held the meeting on financial services for post-disaster reconstruction, demanded the branches in disaster-hit areas to provide quality financial services to support post-disaster reconstruction, and developed feasible programs to support the financial services in Yushu.

　　In April, five provinces in the southwest were hit by severe droughts. Leaders of relevant departments of Agricultural Bank of China went to Hechi and Baise of Guangxi for field survey on drought situation and the losses of farmers and held on-site meetings to make arrangements for post-disaster financial services. To reduce the impact of the disaster and reduce farmers’ economic loss, the bank's staff went to the fields to install water pipes and generators for affected farmers and actively helped the rural households to resume production and life. They promptly collected data and simplified credit procedures to issue petty loans to rural households, which effectively alleviated the funding problem of affected farmers. In 2010, for another example, Guizhou Branch of Agricultural Bank of China issued a total of 1.208 billion Yuan of loans to rural households and the loan balance was 1.167 billion Yuan, 279 million Yuan more than that at the beginning of that year. The loans were mainly used to support the development of farming, purchase of agricultural production means and other production materials, which helped rural households increase income of 1.481 billion Yuan, averagely 30,000 Yuan for each household.

　　Agricultural Bank of China conscientiously implemented the strategy of rejuvenating China with science and education, supported public resources to flow towards rural areas, central and western regions, poverty-stricken areas and border and ethnic areas so as to gradually narrow the development gap between urban and rural areas and boost the coordinated development of science, education, culture and health industry. The rural industrial financial department issued special policies (such as the "Regulations of Agricultural Bank of China on the Management of Loans for High Schools in Counties" (Nong Yin Ban Fa [2009] No. 822) and "Regulations of Agricultural Bank of China on the Management of Loans for County Hospitals" (Nong Yin Ba Fa [2009] No. 823)) to lower the access standards for county high schools and hospitals to obtain loans and ensure that its financial service of credit loans can cover at least one high school and one public hospital of each county. Meanwhile, the bank took concrete actions to support the activities of sending cultural, technological and health care service to the countryside. As of the end of 2010, it had provided credit loans for 341 county hospitals and 287 schools.

　　As a member unit of the State Council Leading Group of Poverty Alleviation and Development, Agricultural Bank of China is in close relationship with LGOP, China Disabled Persons’ Federation, All China Women’s Federation and Glorious Cause Promotion Association of United Front Work Department. It has successively issued the “Advice on Further Poverty Alleviation with Recovery Loans” jointly with China Disabled Persons’ Federation and the “Advice on Advancement of Micro Credit for Rural Women” jointly with All China Women’s Federation, and vigorously provided financial support for poverty reduction among the disabled and rural women. Meanwhile, Agricultural Bank of China continued to provide data and information about poverty alleviation in credit and financial poverty alleviation for “China Rural Poverty Monitoring Report” written by Rural Social & Economic Investigation Division of National Bureau of Statistics and recommends to relevant branch the anti-poverty fund projects of Glorious Cause Promotion Association every year to give play to the role of anti-poverty loan interest subsidy in indirectly boosting the economic development of impoverished regions.

　　【Recognition of advanced collectives and individuals in poverty alleviation by credit loans】 To reward the advanced collectives and individuals in poverty alleviation by credit loans over the years, the bank summarized and publicized good deeds, advanced experience and typical practices in its poverty reduction and carried out the "advanced collective and individual assessment activity for poverty alleviation by credit loans" among county branches and lending officers from 2000 to 2010, and rewarded 30 advanced collectives and 60 advanced individuals. The activity aimed to encourage the bank and all its staff members to actively devote into the great cause of poverty reduction by credit loans and provide better financial services for impoverished regions.

　　【Fixed-point poverty alleviation】 Since its joint-stock system reform, Agricultural Bank of China has continued to serve three rural business and actively undertake social responsibility. The standard of anti-poverty fund of 500,000 Yuan for Wuqiang County and Xian County – two national key counties for poverty alleviation and development has been raised to 1 million Yuan. Meanwhile, the bank provides computers and other materials every year to support anti-poverty projects for the transformation from blood transfusion to blood-making poverty relief so as to contribute to local economic and social development, and achieved the poverty relief objectives for the "11th Five-Year Plan" period.

　　Headquarters of Agricultural Bank of China mainly supported the construction of Xian County’s vocational education centers and teacher training schools, trained more than 4,000 technical workers, transferred over 9,000 rural surplus labors, increased income of farmers by 300 million Yuan per year, lifted many households out of poverty by attending trainings, and achieved good social benefits. Meanwhile, the Headquarters of Agricultural Bank of China supported Wuqiang County to build a playground for Wuqiang Middle School and set up two Hope Primary Schools, which greatly improved the school's operating conditions and enhanced the teaching level, widely praised by the people of the county.

　　For more in-depth, detailed, solid job in fixed-point poverty reduction, to conscientiously implement the decisions and deployments of the Headquarters of Agricultural Bank of China and strengthen the leadership for fixed-point poverty reduction, in accordance with the arrangements of the Leading Group, relevant leaders of the Headquarters of Agricultural Bank of China led relevant persons to carry out field survey on fixed-point poverty reduction in Xian County and Wuqiang County of Hebei Province on August 14, 2010. They went to the grass-roots businesses, schools and poor rural areas for a comprehensive understanding of local culture, economic and social development and natural environment, conducted field survey to learn about the overall planning for anti-poverty work in the two counties and the implementation of fixed-point poverty relief projects, met with the temporary cadres sent to support the poverty reduction of the two counties, interviewed local leaders and poor residents, held talks with the two counties’ leaders on study of future anti-poverty projects and further clarified the key points and guiding line for poverty relief.

　　In addition, temporary cadres of Agricultural Bank of China sent to the poor counties actively cooperated with county party committee and government to speed up the pace of poverty alleviation and development and promote the coordinated economic and social development in urban and rural areas, highlighted the development of rural industrialization and transfer of surplus labors and explored new path for poverty alleviation with local characteristics. As a result, averagely 6632.7 rural households were lifted out of poverty every year. Due to the outstanding performance and remarkable achievements, one of the temporary cadres was rewarded by the State Council Leading Group of Poverty Alleviation and Development and titled as Advanced Individual in fixed-point poverty reduction by state organs, and another one won the municipal third class merit and was granted the title of honorary citizen.