CITIC Limited Half-Year Report 2020

107 CITIC Limited Half-Year Report 2020 For the six months ended 30 June 2020 Notes to the Consolidated Financial Statements 29 Financial risk management and fair values (continued) (a) Credit risk (continued) (vi) Rescheduled loans and advances to customers and other parties Rescheduled loans and advances are those loans and advances which have been restructured or renegotiated because of deterioration in the financial position of the borrower/debtor, or of the inability of the borrower/debtor to meet the original repayment schedule and for which the revised repayment terms are a concession that the Group would not otherwise consider. 30 June 2020 31 December 2019 Gross balance % of total loans and advances Gross balance % of total loans and advances HK$ million HK$ million Rescheduled loans and advances 33,093 0.71% 25,444 0.57% – Rescheduled loans and advances overdue more than 3 months 20,065 0.43% 12,057 0.27% (vii) Offsetting Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously. As at 30 June 2020, the Group did not enter into significant enforceable master netting arrangements with counterparties and therefore there were no significant offsettings of any assets and liabilities in the consolidated balance sheet (31 December 2019: Nil). (b) Liquidity risk Liquidity risk arises when there is mismatch between amounts and maturity dates of financial assets and financial liabilities. Each of the Group’s operating entity formulates liquidity risk management policies and procedures within the Group’s overall liquidity risk management framework and takes into consideration of the business and regulatory requirements applicable to individual entity. The Group manages liquidity risk by holding liquid assets (including deposits, other short term funds and securities) of appropriate quality and quantity to ensure that short term funding requirements are covered within prudent limits. Adequate standby facilities are maintained to provide strategic liquidity to meet unexpected and material demand for payments in the ordinary course of business.