Hangzhou EZVIZ Network Co., Ltd

Regarding the financial services business with China Electronics Technology Finance Co., Ltd

Risk assessment report

In accordance with the provisions of the Notice on Regulating the Business Dealings between Listed Companies and Financial Companies of Enterprise Groups (Zheng Jian Fa [2022] No. 48) and the Self-Regulatory Guidelines for Listed Companies on the Shanghai Stock Exchange No. 5 - Transactions and Related Party Transactions, Hangzhou EZVIZ Network Co., Ltd. (hereinafter referred to as "EZVIZ Network" or "the Company") has passed the inspection of the "Financial License" and "Business License of Enterprise Legal Person" and other documents of China Electronics Technology Finance Co., Ltd. (hereinafter referred to as the "Finance Company"). It also reviewed the audited financial reports of the financial company in the latest year, including the balance sheet, income statement, cash flow statement and other financial reports, and evaluated the business qualifications, business and risk status of the financial company, and now reports the relevant risk assessment as follows:

First, the basic situation of the financial company

China Electronics Technology Finance Co., Ltd. is a non-bank financial institution approved by the State Administration of Financial Supervision and Administration (formerly the China Banking and Insurance Regulatory Commission) (financial license number: L0167H211000001) and registered with the Beijing Municipal Administration for Market Regulation (unified social credit code: 91110000717834993R), and is subject to the supervision and management of the State Financial Supervision and Administration in accordance with the law.

Company name: China Electronics Technology Finance Co., Ltd

Registered address: 1st and 3rd-8th floors, Building 101, Building 2, Yard 30, Jinfu Road, Shijingshan District, Beijing

Legal representative: Yang Zhijun

Registered capital: RMB 580,000

Unified Social Credit Code: 91110000717834993R

Financial Licensing Agency Code: L0167H211000001

Date of Establishment: December 14, 2012

Business scope: absorb deposits of member units; Handling loans for member units; Handle the bill discounting of member units; Handle the settlement and receipt and payment of funds of member units; Provide member units with entrusted loans, bond underwriting, non-financing guarantees, financial advisory, credit verification and consulting agency services; engaging in interbank lending; Handle the acceptance of bills of member units; Handling buyer's credit and consumer credit for member units' products; Engaged in fixed-income securities investment.

(1) Control the environment

In accordance with the requirements of corporate governance of modern financial enterprises, financial companies have set up shareholders' meetings and board of directors. The Board of Directors consists of the Strategy, Budget and Asset Management Committee, the Audit Committee, the Internal Control and Risk Management Committee, the Nomination Committee and the Remuneration and Appraisal Committee. The manager is the executive body of the financial company, responsible for the daily operation and management of the financial company, and accepts the supervision and management of the party organization and the board of directors. In accordance with the principle of mutual checks and balances between the decision-making system, the execution system and the supervision and feedback system, the financial company has set up 12 front, middle and back offices, including the treasury department, the financial service center, the fund management department, the investment department, the fund settlement department, the risk management department, the comprehensive management department, the human resources department, the party and mass work department, the finance department, the information technology department, the audit and discipline inspection and supervision department, and the construction of the organizational structure is relatively perfect.

(2) Identification and assessment of risks

The finance company has compiled a series of internal control systems, built a risk management system, established a risk assessment system and a project responsibility management system within the scope of its responsibilities, formulated its own risk control system, standardized operating procedures, operating standards and risk prevention measures according to the characteristics of each business, separated the responsibilities of each department, supervised each other, and predicted, evaluated and controlled various risks in the operation. The financial company implements the internal audit supervision system, establishes an internal audit department responsible to the board of directors, establishes internal audit management measures and operating procedures, and conducts internal audit and supervision of the economic activities of the financial company and its subordinate units.

(3) Control activities

1. Credit business management

The loan object of the finance company is limited to the member units of China Electronics Technology Group Co., Ltd. According to the different characteristics of various types of business, the finance company has formulated the Measures for the Administration of Comprehensive Credit Extension, the Measures for the Administration of Credit Business Guarantee, the Measures for the Administration of Working Capital Loans, the Measures for the Administration of Fixed Asset Loans, the Measures for the Administration of Domestic M&A Loans, the Measures for the Administration of Commercial Draft Business, and the Measures for the Administration of Post-Loan, etc., to standardize the operation processes of various businesses. The finance company has made unified and clear provisions on the different credit guarantee processes and management requirements such as guarantee guarantee, mortgage guarantee, pledge guarantee and security deposit, and the guarantee shall follow the principles of equality, voluntariness, fairness and good faith. The acceptance and discounting business of commercial bills shall be handled in accordance with the principle of "unified credit, separation of examination and loan, hierarchical examination and approval, and clear responsibilities and rights".

2. Fund management

The finance company strictly abides by the State Administration of Financial Supervision and Administration, the People's Bank of China and other relevant regulatory authorities

The rules and regulations have been formulated to provide basic systems related to fund management, such as the Measures for the Management of Funds, the Measures for the Administration of Interbank Credit, the Measures for the Administration of Bank Accounts, and the Measures for the Administration of Interbank Certificate of Deposit Business, as well as the Measures for the Administration of Interbank Lending Business and the Measures for the Administration of Bond Pledged Repurchase in the Interbank Market, to clarify the basic principles, decision-making processes, operational specifications and other requirements of various capital-related businesses, and to strictly regulate the capital management of financial companies.

The financial company's capital management adheres to the principles of planning, unity, security, liquidity and efficiency. Planning refers to the planning and management of the raising and use of funds of the financial company; Uniformity refers to the implementation of unified management and unified scheduling of funds in accordance with the capital plan of the financial company; Security refers to ensuring the safety of deposit, settlement and delivery of funds; Liquidity refers to meeting the reasonable demand for funds of the financial company in a timely manner, using the active funds, and allocating them reasonably; Efficiency refers to the efficient and standardized operation of funds, reduce the cost of capital, and actively strive for reasonable economic benefits for the financial company.

3. Investment business management

The Finance Company has formulated investment business management systems such as the Basic System for Financial Securities Investment Business, the Measures for the Administration of Public Fund Investment and the Measures for the Administration of Bond Business. The investment business mainly includes fixed-income securities investment such as bond fund investment and high-grade bond investment. The investment business of a finance company follows the following principles:

(1) The principle of standardizing operations and preventing risks. The development of securities investment business shall strictly abide by relevant laws, regulations and regulations, and carefully select and standardize operations.

(2) The principle of teamwork and division of labor. Emphasize the overall sense of cooperation of the investment team, and at the same time clarify the main person in charge of each securities investment business.

4. Settlement business

The Finance Company has formulated the Measures for the Administration of Settlement Accounts, the Measures for the Administration of Deposit Business, the Measures for the Administration of Settlement Business and other relevant systems and operating rules for fund settlement business, and has made clear provisions on the transfer of funds by member units. The financial company follows the following principles in carrying out settlement business: abide by credit, perform payment; Whose money goes into whose account and who disposes of it; The finance company does not make advances; Freedom of access and confidentiality for clients; Save before use, no overdraft.

5. Information system management

The finance company has formulated the "Administrative Measures for the Construction of Information Systems", "Administrative Measures for the Operation and Maintenance of Information Systems", "Administrative Measures for Information Technology Outsourcing" and other systems to standardize the construction and management of core business systems and clarify the systems

O&M procedures and responsibilities reduce the risk of technology outsourcing, ensure the safe, stable and efficient operation of the system, and make the system better serve the production, operation and management of the enterprise. The core business system of the finance company is developed and delivered by the outsourcing vendor, and it provides follow-up software service support. As of the release of the report, the core business system of the finance company is operating normally, and the cooperation with outsourcing vendors is stable.

6. Audit management

The financial company has formulated the "Basic System of Internal Audit Management" and "Measures for the Management of Internal Control Evaluation" and other relevant systems for internal control and auditing, improved the internal audit system, clarified the responsibilities and authority of internal audit, and standardized the internal audit work. The objective of internal audit is to promote the implementation of relevant national economic and financial laws and regulations, guidelines and policies, rules of regulatory agencies, regulations of group companies and internal systems of financial companies; Facilitate the establishment and continuous improvement of effective risk management, internal control compliance and corporate governance structures for finance companies; Supervise and urge the relevant audit subjects to effectively perform their duties and jointly achieve the strategic objectives of the financial company.

(4) Overall evaluation of internal control

By establishing an organizational structure with a reasonable division of labor, clear responsibilities and clear reporting relationships, the financial company clarifies the responsibilities and obligations of the executive body, the construction agency and the supervisory body of internal control management, so as to ensure that the responsibilities and authority of internal control management are clear and the internal control system is effectively operated. At present, the financial company has established 191 systems in 13 categories, forming a scientific, reasonable, effective and applicable internal control system, completing the full coverage of various businesses and management of the financial company, and ensuring that the financial company has activities and management, management and system, and strict implementation of the system.

3. The operation and management and risk management of the financial company

(1) The operation of the financial company (audited)

According to the 2024 audited financial report of the Finance Company, as of December 31, 2024, the Financial Statement

The company's total assets are 112.360 billion yuan, liabilities are 100.651 billion yuan, and owners' equity is 11.709 billion yuan.

From January to December 2024, the company achieved an operating income of 2.232 billion yuan and a net profit of 1.224 billion yuan.

(2) The management of the financial company

Since its establishment, the finance company has strictly followed the Company Law of the People's Republic of China, the Banking Supervision and Administration Law of the People's Republic of China, the Measures for the Administration of Financial Companies of Enterprise Groups, the Accounting Standards for Business Enterprises, and the relevant financial laws and regulations of the state, as well as the articles of association of the financial company, to standardize its business behavior and strengthen internal management.

(3) Regulatory indicators of financial companies

According to the requirements of supervision, management and risk control of the State Administration of Financial Supervision and Administration, the financial company strictly abides by the following requirements for the ratio of assets and liabilities in its business operations:

(1) The capital adequacy ratio is not lower than the minimum regulatory requirements;

(2) The liquidity ratio shall not be less than 25%;

(3) The balance of the loan shall not exceed 80% of the sum of the deposit balance and paid-in capital;

(4) The total amount of non-group liabilities shall not exceed the net capital;

(5) The balance of bill acceptance shall not exceed 15% of the total assets;

(6) The balance of acceptance of bills shall not be higher than 3 times of the balance of deposited with the bank;

(7) The total amount of bill acceptance and rediscount shall not be higher than the net capital;

(8) The balance of the deposit of the acceptance bill shall not exceed 10% of the total deposit;

(9) The total amount of investment shall not exceed 70% of the net capital;

(10) The net amount of fixed assets shall not be higher than 20% of the net capital.

4. The company's deposits and loans in the finance company

As of March 31, 2025, the balance of deposits and loans of the Company and its subsidiaries in the Finance Company is 0,

No settlement, general credit or other financial services transactions have occurred.

5. Risk assessment opinions

Based on the above analysis and judgment, the Company believes that:

(1) The financial company has a legal and valid "Financial License" and "Business License for Enterprise Legal Person";

(2) The financial company has not been found to have violated the provisions of the "Measures for the Administration of Financial Companies of Enterprise Groups" promulgated by the State Administration of Financial Supervision and Administration;

(3) The financial company is in good operating condition, and all businesses can be carried out in strict accordance with the internal control system and process, and the internal control system is relatively complete and effective; All regulatory indicators are in line with the requirements of regulatory authorities; The business operation is legal and compliant, the management system is sound, the risk management is effective, and no major defects have been found in the risk control system of funds, credit, investment, inspection and information management related to the financial statements. At present, the risks of financial businesses such as related deposits and loans between the Company and the finance company are controllable.

Hangzhou EZVIZ Network Co., Ltd

Board of Directors

April 12, 2025