CITIC Limited Half-Year Report 2020

93 CITIC Limited Half-Year Report 2020 For the six months ended 30 June 2020 Notes to the Consolidated Financial Statements 28 Contingent liabilities and commitments (continued) (c) Redemption commitment for treasury bonds As an underwriting agent of PRC treasury bonds, CITIC Bank has the responsibility to buy back those bonds sold by it, should the holders decide to early redeem the bonds held. The redemption price for the bonds at any time before their maturity dates is based on the nominal value plus any interest unpaid and accrued up to the redemption date. Accrued interest payables to the treasury bond holders are calculated in accordance with relevant rules of the Ministry of Finance and the People’s Bank of China. The redemption price may be different from the fair value of similar instruments traded at the redemption date. The redemption obligations below represent the nominal value of treasury bonds underwritten and sold by CITIC Bank, but not yet matured at the balance sheet date: 30 June 2020 31 December 2019 HK$ million HK$ million Redemption commitment for treasury bonds 10,936 12,584 As at 30 June 2020, the original maturities of these bonds vary from 1 to 5 years (31 December 2019: 1 to 5 years). Management of the Group expects the amount of redemption before maturity dates of these bonds will not be material. The Ministry of Finance will not provide funding for the early redemption of these bonds on a back-to-back basis, but will settle the principal and interest upon maturity. (d) Guarantees provided In addition to guarantees that have been recognised as liabilities, the guarantees issued by the Group at the balance sheet date are as follows: 30 June 2020 31 December 2019 HK$ million HK$ million Related parties (note) 12,880 16,229 Third parties 2,040 2,886 14,920 19,115