Beijing Enterprises Water Group Limited (BEWG) plans to replace its existing deposit framework with a new three-year agreement that sharply raises the ceiling for funds it may place with Beijing Enterprises Group Finance (BG Finance).

The 2026 Deposit Services Master Agreement, signed on 13 Feb 2026, will run through 31 Dec 2028. It allows BEWG to maintain demand, call, time and agreement deposits with BG Finance at interest rates not lower than (i) the People’s Bank of China benchmark, (ii) comparable rates from commercial banks in Hong Kong and mainland China, and (iii) rates offered to other members of the Beijing Enterprises Group.

Proposed annual caps for the cumulative daily outstanding deposit balance (including accrued interest) are set at RMB 2.57 billion for each of the following periods: • 13 Feb – 31 Dec 2026: RMB 2.57 billion • FY 2027: RMB 2.57 billion • FY 2028: RMB 2.57 billion

The new limits replace the current RMB 980 million cap agreed in 2025, which was already 92.55 % utilised in 2025. Management cites a RMB 9.57 billion cash balance at end-2025 and rising operating cash inflows as reasons for the increase. Deposits with BG Finance represented only 8.9 % of total cash at year-end 2025.

BG Finance, a non-bank finance company regulated by the National Administration of Financial Regulation, is an associate of BEWG’s controlling shareholder Beijing Enterprises Group Company (BEGCL) and Beijing Enterprises Holdings (BEHL). Because applicable percentage ratios exceed 5 % but are below 25 %, the deal is classified as a discloseable and continuing connected transaction under Hong Kong listing rules, requiring independent shareholder approval.

An extraordinary general meeting is scheduled for 22 Apr 2026 in Hong Kong. BEGCL and BEHL, which collectively hold 41.50 % of BEWG shares, will abstain from voting. Independent non-executive directors and the independent financial adviser, Diligent Capital, have deemed the terms fair, reasonable and in the interests of minority shareholders.