Q2 2021 Lexinfintech Holdings Ltd Earnings Call
[music].
Ladies and gentlemen, thank you for standing by and welcome to the lexicon Fintech second quarter 2021 earnings conference call. At this time all participants are in a listen only mode. I must advise you that this conference is being recorded today I would now like to hand, the conference over to your first speaker today.
MS Patricia Chang head of capital markets. Thank you. Please go ahead.
Hi, everyone welcome to your motion second quarter 2021 earnings call I always felt was issued earlier today and are available online.
Joining me today on the call are Mr. James Shell, our founder Chairman and CEO.
Mr. Chris Chow, our interim CFO.
Mr Chi Chow Chief risk officer, and that was a senior finance director.
She was supposed to provide an overview of our recent performance and highlight.
Chris will then discuss our financial results and Jason will cut the credit performance.
Before we begin please note.
The Safe Harbor statement in the earnings press release, which applies to this call as well as will be.
As well because we will be making forward looking statements.
The call May include discussion of non-GAAP financial measures.
You can find the reconciliation between non-GAAP and GAAP in the earnings press release.
Finally, unless otherwise stated all numbers mentioned during this conference call are U L. M B.
I will now pass it over to Jay his remark will be in Chinese and translation would follow a G E.
Well they'll go home and garden Jody.
Total.
So another thing that you got the only other income base.
We're going to have a day. So that's a good idea for single type of buffer.
So Chris you need to change it at all to.
But because they got a license for <unk>.
Several of them in southern Florida.
No change at all or well then that's easy to do.
The woman that basis.
<unk> Oh my God.
Thank you that is equivalent which was up.
But women got funded.
Okay.
Did you tell them into the whole the changes.
You'll just a junior issue dealt with each other.
So you don't know if I said it would be in children, a little further into it.
Okay.
He said look this is hal.
You many need underneath cushy, there's a woman.
So I don't think so.
Well, it's good to know.
And as Suzanne said, Alex So this yourself.
So you can touch on that.
I did want to also kind of your tier told me. He said goodbye good TVN, so you'd get about what would be kind of a woman to us is how you're able to win here.
Sure that's all going away. So I was just wondering.
Well, yeah, we don't want to women.
Yeah, that's a good told us the synthes.
So you believe women way of life.
Yeah.
That's how that density.
But what I do just have a secondary and that won't be too long without question the witnesses.
You'll just see.
Understood.
Dave touched on before her entire woman you do women who are in jail.
So the 10 tons a day.
You talked about you've kind of you've got held up.
Well I mean, as <unk> talked about a deal so again.
A woman that turns on the Sudan.
So to answer the two parts of the alcohol thats how it anymore.
Yes.
Into women's gradient dunk trunnion of Dupont's barbell, let's leave total tender.
You bet, you bet shall I say that because somebody.
The other thing I saw so many don't quite seem to ourselves so.
Genco could so this isn't as Harold Washington D C.
What it ends up going to a young woman, who would I go to do.
We will see samples as having cheap cook for his father.
Dumping jobs.
You can tell us a whole woman told me they told us that they'd cohort that's easy there's money how's.
Okay golfing difficult cool Celgene Tilda woman of Ocean Pillow, John Susan.
But without a doubt.
Okay.
She told me if a child who.
We continue.
Cohort the jogger Suncal attributable E boosting charter retail Fintech charter SEC cohort of Union teaser users than two niches in Cleveland.
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I guess I put him there would be helpful. So I mean, if you do that you can do it without so cold.
Women in the choice of the jumbo woman or any of the new talent that will tell us it sure Bob Cushing here, where they could see him a goldman's also in Minnesota.
Tulsa, we'll need to see table potash and Salt Italia my teeth.
I hope with the same kittens Oh did all the alcohol to Sundar subtle guns, Hautbois Ya Qin Zhang Sohu corridor.
Audio was about Yahoo.
Sunday I suppose you'll either Tim will be so easy to do that will be a wait and see to the Toledo wishing you told US you know if other income to loosen the father of getting it done.
So nobody is getting all the questions for chauffeur cars, you know she's hoping June would I tell you go holiday she had her father.
So as we're looking at it yet solution will either go attention to any.
She said that the other ones.
Sure.
Chris what I would tell there is element to consider.
Yeah, well she was with it you said don't you.
Yeah.
The same thing again.
Hello, everyone. It's my pleasure to speak to you all again.
The second quarter was a major milestone for Nike.
She told time heightened several key metrics.
Origination no outstanding operating revenue net income.
Amit.
This is not an easy victory.
We have gone through many ups and downs in the journey and we have always responded with Zika.
For those of you would have to be following that you were witnessing some of the most difficult and challenging moments.
And how the team responded to change in terms of business correct.
Especially following the decline in credit performance after COVID-19 last year.
Yeah.
We think our strategy and carry out full upgrade of the risk control system strengthening our capability in managing with asset quality.
The assets have been paying off.
Credit performance continues to trend well in the past few quarters.
The 90 day delinquency ratio fell by over a 100 basis points to one point.
Eight 5% year over year in the second quarter.
And that one was held steady.
Jim will elaborate on this later.
What I would like to highlight a change we have implemented and the capability that we have to build up they have laid a solid foundation, helping us to face any industry headwinds that may come our way.
So now let me get to what you're most interested in the regulatory change, especially the 24% pricing cap.
And how we would be responding.
This will have a major impact on the industry.
And in response.
So embarking on a transition ourselves.
First of all.
We will slow down a page.
And we will step up the focus on asset quality and profitability of our business model.
We have therefore decided to lower full year loan facilitation volume to RMB 230 billion from $2.42 to 50 billion previously.
But looking healthy.
Our sustainable business model is more important than scale.
We will not sacrifice the long term health of the company for the sake of volume in one or two quarters.
With pricing affected by 24% cap.
We're embracing more possession and before I have differentiation in our customer strategy.
We will scale back.
From low quality customers.
Set of risk preference in order to adjust down overall asset risk for <unk>.
Customers currently are below 24% the scope for pricing to go up we will increase the intensity on servicing that group and increase the size.
In addition, we will also enhance our operations.
Efficiency with the ultimate goal of maintaining profitability of our business.
The industry will never stop evolving we are confident that any impact will be transitory and manageable.
One is to match its got all put in place profitability will return to current levels.
Ensuring quality.
Quality and sustainable growth of the core business is a top priority.
At the same time, we will also continue to further develop our new consumption strategy.
Momentum from that yeah that is a buy now pay later product remained strong in the second quarter.
Working with over 1000 merchants and serving over 600000.
Seniors it generated <unk> of RMB 349 million.
More than five times the amount, we got into third quarter.
The initiatives will allow us to tap into new opportunities and diversified our revenue base.
At the core consumer finance life consumption and finance.
If you can drive a much stronger outcome when they.
Go hand in hand.
This is the belief of machine and also our core competence.
Thank you for your interest and support.
I would like to invite Chris to go through the financials in more detail.
Chris Jackie.
Got it.
Uh Huh from argued to cause that often thought about yet.
Cohort two bill Shaw, partially either go polishing golf.
Hi, John.
For example.
Scott.
Bye bye.
Buybacks as well.
I'm done above and honestly.
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So what are you up.
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Shanghai, Social which brings you to do that are truly some drop off in sort.
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EG women definitely everybody money.
Genesco minutes, which aren't you they cause yourself.
We work with them and they're putting Homer Stryker one visit.
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Yep.
Are you pulling vehicles.
Sure.
So if you can put your own comments. So you argued or shorter total yogurt auto trigger to go high attrition.
Is that a woman's egg quantity, but she'd have figured out from your total dollar you held up well.
Special rule Gigolo Io phone call. So here you go well for you and one in Atlanta.
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Sundar I Wonder your boss, which you didn't you.
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So you don't you agreed on Amit Journal, Jay you controversial one.
I'll go anymore or is that true.
Uh-huh towards you.
Hi, Raj I'll Grant you that.
<unk> gained more time food, yeah, articulates with hundred angle here.
Yeah part of it for me.
Second quarter customer metrics topline and bottom line.
Hi.
Let me explain in more detail starting with the top line number of active users reached $8.4 million in the quarter 24.
But at the high year over year.
No origination boost by 47, 6% to RMB 66 billion year over year and no outstanding increased by 42% to 95 billion.
The revenue went up by 10, 5% to $3.3 billion.
I think another record level.
It was also higher.
Sequentially.
7%.
Second page 17 income, what's the biggest revenue driver or by 47, 9%.
As part of revenue without any credit exposure that is platform based services plus online services now made up a third of our total revenue.
Moving on to credit content.
Both maintained good momentum in the second quarter.
Provision held steady sequentially, indicating stable at the quality of our portfolio and our ability in managing risk, which Jason will talk more about later.
Additionally, funding costs continue to go down quarter over quarter.
Driven by the positive trends in volume risks.
Finding take rate improved both year over year as well as Q over Q.
While spending in sales and marketing went up in the second quarter in line with industry trends and we maintained our disciplined administrative and other expenses.
From business mix to mismanagement funding structure.
Cost control August came together to drive the 87, 7% growth in net income.
Amid a regulatory headwinds will continue to stay prudent in risk management and cost management.
As Jay said at the beginning with a no compromise on quality for the sake of scale.
Next.
Next I would like to turn the call over to Jason to discuss our credit performance.
Jason over to you.
Thank you, Chris and Patricia both Jay and Chris mentioned asset quality remains stable in the second quarter, our 90 days plus delinquency ratio finished the quarter at 1.85% down over 100.
Point year over year, but remain steady to first quarter's $1, 84%. Moreover, the 30 days plus difficult delinquency ratio improved to 337% from three 6% in the first quarter.
In terms of charge offs by vintage rate also stable at about three 5% for loans originated during.
Basically ended June 30.
The new customers that we acquired in the second quarter. So far have proven to be a good at the first quarter as shown by the first payment default rate for holiday plus <unk> 34, new loan originations remained at below 1%.
Of course, we cannot be content with our existing efforts regulatory.
Changes will lead to changes in industry and credit quality, we need to make sure that our system can screen quality assets. So the right pricing and the monitor performance. So this and risk management remains a key focus.
I took on the CIO role earlier this year with clear mandate to solidify our risk control initiatives, we have been.
Instituting changes before related to policy changes. These include refining our risk strategies across customer lifecycle as well as strengthening the risk models for each product and channel. We have also stepped up the collection effort.
All of these aimed at boosting low teens capability to weather any market uncertainties.
I'll conclude our prepared remarks operator. Please proceed with question and answer session.
Thank you we will now begin the question and answer session. If you wish to ask a question. Please press star one on your telephone keypad and wait for your name to be announced if you wish to cancel your request.
Please press the pound or hashed E.
Okay.
Please note there may be a short pause of equally the questions.
Yeah.
Okay.
Your first question comes from the line of Eddie Leung of Bank of America Merrill Lynch. Please ask your question.
Oh.
And I'm, assuming when you're starting out can you touch on each other and younger so I went to Oh gosh.
J D.
In Asia, the win T and Yahoo woman yet.
Uh huh.
You embed double builder Yigal.
Taekwondo.
Kind of where you saw that in.
Some of you in the at home.
So you go Oh, its all due daiichi on a woman.
Oh Boy anytime you go away like always it should resolve horseshoe cool cool yeah.
So you should that we should be.
And then why you Wouldnt teaches them when you want to go in my yard legal when she thought when you went public.
A woman solar like opinions or wheel cognizant.
How long ago it seemed to me.
Like you said during the quarter.
Oh, there you go again exiting that woman and see if he's out shortly although you said quite a cool no meal you said her seemed up we Uh huh.
I have two quick questions. The first one is about the regulation.
Jay mentioned that.
Jim would be adjusting them for the full year loan growth target. So ordinary user perspective, how would that change our user acquisition channel or our marketing activities and then I say to me about yeah, a buy now pay.
<unk> argued V shape at all.
And the demographic of user profile characteristics that you can share with us how this users that might be different from the mainstream users.
Our loan portal user base. Thank you.
Hello.
Late Saturday.
Why wouldn't you so it isn't just a and intend to obtain sure. We'll look at all to two charter automobile women through all high school y'all to borrow to a suitor for the digital starter himself well then do cause it's used table to your assortment of two times go down so the woman and good are you guys seeing Josh I'll tell you what the woman.
Yeah, Okay, so no, but I'm thinking, though well then.
Well. They also don't forget that Youll see a woman who is just all of them in the future.
So there's all women well unless you won't necessarily you got killed and come in and they were both of them. Both so you go Peter Jen Covid element so sure that they've got it you need at any so in love.
So it'll take a cigar city, Utah with mobile titles. So today as I Hope you all took opportune to Nissan element that whether it's a gym doesn't go there you got you got you got to deliver well just have to play with Nissan assortment Sonoco, Virginia.
Ohio woman and go to work or school or country.
We're gonna take so you got it okay. That's what I say you go south.
Italy, the Eagle gold so there's a woman that focus on me a woman. She said she was already a significant what I said.
That tells us that the bailout.
Is it a way life.
Well then that doesn't go there you go you go people who doesn't go there you go you go sit down or myself.
So does that kind of delta.
So women.
So I can go there you go you Gotta Guava got hold on.
Well my point, there is a little cushion that's Asia, whereas you're hinting at political the telco to literally shall Gisela how do you do that cohort D D.
So well know quite.
So it doesn't go there you go Cushing Cushing doesn't go to <unk>.
But other than that.
Linda.
And she said well look we've got about a woman.
That's a good color there whether any of the cancer.
Ah well they used to you guys until out of them and it turns out quite.
Quite a bit of a single user will look once you figure out why there you got you got you got to look up at your door, so women as well.
We didn't count on for Carla.
Hi, Betsy go ahead on shelves, where they put it.
So Hana partisan go there you go you go the soil it didn't change the Odyssey.
So I guess how that Florida.
Yeah, there was a woman filaments and good that you've got that kind of thing.
So until they are there she has done a fabulous other than go there you go you got cut off.
You wouldn't be they'll go.
So, let's say it was always thought of it as a woman thicknesses.
How would you wait until the boiler at that so many of us.
So you got to hit on some of the other things whether you go for that.
So the woman.
And then George how good are you guys trying to save quite a deliberate.
Say a woman the total died in a sense you do what you think has a.
Good luck Vishal Woman's Halloween Union through that I've got you can you tell me what are the political.
Good morning.
The antenna hotel will look like under a woman the probation, maybe I'd say.
Hello, Paul Cutaway Mortalities anymore to that.
The beta in yen towards the buy side.
In fund data Center, you got you've got way more.
That's useful.
So those are my youngest son will essentially other than whether you got you and that's what you'll find is saying again, yeah, a little funny.
Okay.
Let me few days very quickly be odd for inflation Apis.
The regulatory change.
We have decided to revise our guidance because quality is very important to us.
Why is that.
We need to make you high risk I'll use it and the purpose is to maintain rate and profitability of our business.
And you can see that the changes that we have to make include funding and also how cheap nothing existing abuse. It and also in terms of our customer acquisition.
<unk> strategy is going to be major adjustments that we have to do and also we have been doing.
And when.
When you Oh, we have been adjusting our business as a result of our customers now when you look at that based on the 24% on the criteria and we have to adjust how we screen.
And how we do our advertising.
Not go after small amount no side and also a high pricing right and we also have two things in a rich to this core group of our customers and of course, there would be some increase in the cost.
And in terms of the offline.
Screening also step up offline team built out.
When you look at our business the offline business Oh, the pricing is below 24%.
And also the asset quality is better than the overall average and also the average loan size is also high.
On the channel that our main channel for Us and one that we will continue to keep on investing at the beginning of the year. There's about 1000 people in the team now is about a 2000 and we already started to see the.
The impact or the AR in the quarter.
So we look at the monthly contribution from the <unk>.
A double from the beginning of the year.
Condition.
Hello.
Uh-huh somebody other Yoko Goldman printed out of it and it seemed like Coca Cola coffee or hadn't got us into the two of them. So I will mention tend to use it comes all women see Oh My God.
And when we look at yogurt and so it doesn't mean you.
You can see a little bit too soon that cohort or whatever.
Out of Cushing.
So because of the supplement Sheila.
And she said she was on a per kilo question Duncan daughter.
Joseph that'll yield to dementia.
On these homes yourself in Paraguay.
Johan you sold or at least give you a call it just a.
Quite a long way will tell you that it is now it sounds like the holiday rentals.
Have you seen agave somebody else I cannot see them you see that you guys are you guys having to talk to you soon though and I can't do that.
I was looking at the table that you.
They cannot Netherlands alone.
Okay.
Cook and if so does it look on a go Sheila well, mainly because all my other than those of you who are well then.
So as I shared in Charlotte and good a sofa, Tim Hi, <unk>, Yeah, that's easy to work with them, but it didn't kill me look I shouldn't call it yourself at the Hilton.
Goodbye for sometimes yourself.
He has a shelf life to give competitive.
How did they hear Linda Gooden.
<unk>, daughter permanent that knowledge into that any herself rather than any other cohort cohort is whether you got it.
Oh, how region tailwind regulation that is our village so what I'm. Most encouraged about is how does it when a function I O would I hate to the cohort of health of the Chinese Doser bids in Tenda since you know that yogurt with oil.
Hello.
Oh, yeah, the quality from demand that you said, it's admittedly back again and Sheila.
A key characteristic.
Yeah. The product itself is interest free installment and when you're looking to to meet naturally is going to attract.
Good quality customers when.
You have high interest rate and the poor quality guidance would actually would go for the high interest rate because they cannot get them elsewhere.
This one is interest rate so it actually it naturally attracts 50 quality he says.
And then second characteristic of startup we do it offline together with Marc and other brands and nowadays empty.
Tony you know like customer with a certain income level. They would go to a mall and ease of shop. So again, that's why we are able to attract quality customer this week and so far when you look at the potential risks are we do see that it's better than Austin Sheila.
Thank you very much.
Your next question comes from the line of Ethan Wang from CLSA. Please ask your question.
Oh sure Yeah, Brian Frank.
I'm sorry.
We're charging.
Sure.
10.
Sure Josh.
So if you're a woman.
For Ya.
Uh huh.
Hey, Greg.
Uh huh.
Sure.
Yeah.
Morning.
Sure.
You should keep watch on.
Kind of where you're correct.
Thiago in tier one capital light business model.
Warm on the porch.
So you should be all right.
Uh huh.
We should be on watch yourself.
Five M B voucher.
That'd be great.
Sheldon when she walks out did you go to school.
We finally got yet one month, LIBOR, which you all can.
Daughter, a July cut.
Yeah, well Yung Wei cohorts, you're on kind of what's going on I swore she has shipped away anyway.
In Guangzhou, AUM Clinton women, who could help us out.
Okay. So I.
Two questions.
First one is to be around.
Regulatory challenge, Sean about keeping the APR.
4% just wondering if management has done some quantitative forecast on the impact for take rates and launch in Asia in the next two or three or four years.
The second question is on a capital light business model, we've being doing their transformation to a capital life with some years, but then we decided to keep that percent stable just wandering onto the new 24% APR cap.
Does that strategy change or.
Hum.
Just wonder remain at their current level.
Okay.
Oh great.
So that's it.
The other thing Sheila assortment because it literally is all a tour that you said <unk> since I took the rental so tim elements into the cohort start also.
Okay. So is that I think I'll leave it there.
And do they go cooking, so let's see I believe a whole lot because that's all women tell about how about you got you.
So that nets out to the public pay to hit to hit your hoodie Okay.
But other than that since it is all about so typically you're able to tell you that.
It's in the.
10.
So this has really put us in good that you've got a fully funded with US yesterday no. One that can it typically your horse a shortage in Colorado.
The woman that they bought at a good rate you got Susannah.
So I anticipate that to the tier one of course, Angela well material way life well lived in the us so doesn't layover overlay with other than the others.
PV so therapy this woman theme.
So there's a little bit it will then show parts and Gupta, our latest they play over the phone.
Yeah. It was all whaler, Google woman Shambled about you'll go to the other so that's a good Amanda we'll need about 500 million of voting Jonathan So many of them on the phone here. So then go total load handling without high level here.
Are you glad you got the idea that you'll see.
Okay.
He said other than Gulf, highlighting whether you got the changes have been renovated as well into it.
Linda is a.
What I would do it with me as well so top out so that you can is it.
So rule of thumb in parcels that didn't get done got it you got probably going to take it.
No woman with I've been.
<unk> moved out of the.
And that's only going to do that could be deemed leukopenia, well do that through the equate to women with Walter and Linda So Eagle Ford Yes.
So I'll start and then I saw was really trying to do that without a doubt our sell in to the was it a woman bookshelves, a module or module K over to Jacob.
Illegal woman settlements with your emotions on kind of AUM actually Youll 90, and then go to other income value you've got to take a leadership here. So let me talk to you like a woman that take rate juju power centers and deal once again cigar Lake.
I went through them.
Yeah.
We have carried out in time analysis and models on up to 24% impact at the moment, our most of our customers in terms of risk profile. They often know at 24% and for this group of customers definitely we have scope, we can bring down the pricing to meet the criteria and we will.
Good morning.
Oh for the group.
About 24% just to stick with that.
And with.
With them and what pricing our aim is to bring down the overall.
Oh, yes.
And so we have to maintain our asset quality.
And on this.
Keep the profit sharing model that is the capital like model.
We aim to at least maintain at today's level, but of course, we would look at the mix.
Profit sharing risk bearing.
Just the mix.
The aim of course to ensure that that would meet the requirement.
To keep up with the Africa.
Andi.
And.
But once you know the automation that we have begun once you all put in place we do expect that our take rate would be about three to three 5% will be able to maintain at that level.
Got it thank you.
Quality.
Okay.
Your next question comes from G. L. M. S. Please ask your question.
Oh, Okay. So you got anything you want to go.
Cumulatively.
Where do we go when is it going to take I can anyway.
Recently as you know there is no confusion.
What do you think.
I'm going to them.
On the NIM.
D O collaboration with Amgen.
Hum.
So I'm not.
So I'm.
I agree with you the peninsula medical necessity.
The reason the stock equity. So you guys have done a b mall.
Thiago when because of the hydrogen Julien.
But I think it would be that doesn't jive as a whole.
Yeah, she knows something on the Joshua huge hold them either you guys finding cost.
And do you think that they can take rate either.
So I'll briefly translate the first question is about the new personal data protection regulations, and just wanted to ask management.
Based on your judgment.
Judgment, which which roughly what part of the profit can be impacted and should be modified as a result, and is there any permanent preliminary plan and and then related to the extra compliance cost what would roughly be the impact to the cost side and the second question is related to that if you need more than a pricing.
So I just wonder is there any new levers and motion can pull in order to forge for lower potentially funding costs.
Oh I thought either in Q I appreciate your attention to both copper purchases until the <unk> input.
Changes in platelets.
Capsule do a bunch of them could add.
Our petition to the Ocean <unk> correlate with pizza lunch under a shelter in the younger you go up I.
So you said there was such a good tissue for midterm, which essentially into the feasibility study.
The ultrasound.
Sure <unk>, Yeah, I wouldn't say so.
Since quarter end Pushout initial Stefan industrial tends to you Sean I.
But nothing that <unk> assumed hunting Yao <unk> 10 to earnings.
So you just your color should side ultrasound Acs at BMO.
<unk> tonnage in tissue, leading to include assumption and have been.
We don't want to go to frequently the Jaguar.
He joined tissue, Tim what Mayo, a more casual male <unk> city, Shandong come into ECA bamboo <unk> hotel.
R&D personnel.
Importantly data data protection that won the principle.
Debate on the minimal requirement.
Our principle that we have always been a following in our data collection process, we have made adjustments to our app as a result.
In order to make it more compliant some minor changes.
Personnel for example.
Authorization comes back in the past there was a master authorization, so deep niche he said.
It was agreed to a master.
Policy and now in each.
Scenario the individual would have to you Keith.
Our SEC.
Permission.
That's going to increase our compliance cost.
It's not going to affect the results of our risk analysis.
At the moment.
Not at my confirmation and also with the details.
We have not yet come out from directly to exactly how much.
<unk> change or how much.
Margins will have to carry out we will closely monitor the situation.
Yeah.
Okay, well actually I haven't even Dr. Glenn here.
Got it.
So you're talking about.
Women, who cheat contract huh.
I think that's.
If you can talk about now push.
Sure when contracting now lets see arc.
I see.
Well, maybe we should have that done Peter from Shan Shan better Cogent entered alcohol don't hit it somehow shut down Oh, sorry.
So I can call it at the time to Donaldson runs out of Ohio.
So controllers, a new vonda.
Awful lot of Xiaomi.
So I think I don't know I don't know.
<unk> without using Yokohama is against without.
On the other.
Thank God I think are going to Virginia, you've got that in a moment.
Hum.
Okay.
On your second question about funding cost.
In the long run.
<unk> funding cost to be stable and also to go down a little bit.
And with the project capital of 24%.
It's going to improve and that the quality is also going to be a better that will allow us to tap into more of a funding partners and we will also increase.
The issuance of ABS, and we will increase that will help us to improve our funding structure.
So the funding cost.
Thank you very much.
Your next question comes from Alex <unk> of UBS.
Please ask your question.
Oh gosh.
Hum.
Well, we aren't going to give up on you.
So we've had quite a bit quiet the financing Hunter mentioned, you don't mind me, saying.
Jamaica, Chihuahua, Oh, when I leave.
Yes.
B S.
Sure.
I'm not saying that.
Sometimes it doesn't work.
Consolidated which Italian.
And yet because of the high clean so lame duck.
Yeah.
Got it got dry Bud now Jose requirement.
So absolutely so when you go in I.
That's all good news.
Income won't be all day.
I will make a.
The other one piece of glass.
You're killing me too.
So it's not like I say, it's 18 days here punching pump all of that once again compete with them.
You know who you are.
So it's a changing of just harder than that so coming out of China before they pick up.
And I think that's only GAAP.
Pardon me.
I will translate my question first one is on your.
Like its development of a family along so.
I'm wondering what are the average interest rate or cap at below 24% for this type of guidance.
If it is done now I would presume it would be under less affected by the kind of focus on IRR are kept so would you.
If that is basically to continue maintain the stay.
Stable gross driver for polo team for the next year and do you have any sort of a target.
Oh volume contribution or what is it that's for me.
And the next two to three years. My second question is about my business to.
Sure.
Development status for this business.
For example, the latest growth data for the past few months.
And how do you plan to continue to.
I like our growth is going.
Thank you.
Sure.
So here, we are with each other they felt where does it go into they saw they used a woman can you take the total that you could hinder you just okay with it.
Just one more looking telling me that you're improving your go forward. She says how you'll see vishal.
No.
<unk> 19 now.
I will then totally converted NIM phosphate I believe a cohort led towards it.
Well, that's what I hear hung any NIM.
So that sort of go there you go.
Again, you got to say it will cause a yoga to say walk power say TV led towards a little bit that the only way you can tell it and that's what I hear is a partner.
Putting themselves.
You bet.
She told me that they may go to sort of get you got to hear that's always kind of thought I equal to what we're good at this.
I'll kind of take a year well muscle here.
Also send it you've got Tiger one so he may take a took a dose Archie yeah, that's hidden by choices.
Sure.
Got it.
That's.
That is just how the how that you are telling me good insight on that as well as how the deal wasn't done do.
Oh, Yeah, Yeah, Yeah, sure I can tell us with Intel it kind of changes. So it was the opinion that will be all she was the one that has a.
But I wouldn't in terms of sort of ahead of time and then go towards we are below the limits US well then they will continue with other kind of.
Gotcha.
So well know more well maintained good so another whole James gotcha, but some elements in here to a degree of who does it without you got you got you got things in motion to be outside of this one.
Well known media, which they don't have the ability to go from here.
So we started.
Yes, because on our platform.
Some people have to do something.
So we started with grid.
We did a London based on our pumps and invoices and I D.
Does that include a cross border E Commerce, and the auto industry, we took a prudent view.
Because you can see that and I'm looking at the new London alone.
It's bigger than retail and also deterioration I take longer to see.
The progression of risk and to monitor performance. So right now we are starting with the top.
So we kept that upset the risk characteristics and also we can fine tune our risk model if I may.
I'm also pleased to be.
That said, we were going to step up the volumes next year.
Oh Boy My answer that I have just started kind of yeah. So I'm, finishing totally got told me, they're all dogs to the attempt in the tonnage and grade go Copel to Sudan.
So I'll touch on that are you guys on the Colgate. So no woman took a year when I say opinion are easy to Sasha.
Well most of those types of diets or filled I couldn't do that as you probably have to discuss it.
So a woman yeah contango empire kinds of choices in the 10-K, so I'm going to have a woman on the lithium Python sold off the shelf what I'd call out.
And then if I am clear is the portfolio well known pay cut it out to the family.
Oh Boy you got yourself.
So he thought that didn't hit a woman who that you've got TV I mean, what other kinds of him and go go how does it yourself I told a man or woman dying you pool funds.
Hi.
Michelle go kind of go.
Two of the seasons change my job I changed how competitive you guys household and how you would have a good idea. So I took a here's what you can sell.
In women with him to a sort of imply that you've got sort of ink.
The woman.
Do you find the woman.
So essentially because of the whole because that's what we tend to look.
Hey, you should treat or something so.
Women argued all woman to have spent a lot of choices those.
Since their launch and so on.
Got it.
Can you tell us.
Judah intuitive personal challenges that triangle is a tortilla.
Tortilla Cuddle attentions and go there you go through the second Masa.
Well, maybe I kind of took a turn a year.
Even more so than the hurdles that you're going to.
No woman you sunk into this.
So the figure most of the.
Daiichi Sankyo in Angola.
So that's all good yeah, you'll tell us how many of those how that doesn't go that you got no more time I kind of look here what was that figure beautiful juice, our suezmax vessels, how should how can this woman so you're trading agenda, you got down to wait til.
Oh, Yeah. We also started a new business this year.
Got it.
Oh, yeah the quality.
Okay.
On average.
And.
And it looks like a potential we see strong potential coming from this market. So first quarter that was out of our industry and the second quarter, we tested the D Mor.
Industry and we welcome.
Is that more brands and I think that from Denver to be in our pocket and we do see that recognition in China.
And that's going to help drive E. At G M D and for some brands that with you offline I. They have reported back that the average spending has been going up has gone up and also that's also more additions.
Additional purchases.
And from the Street you are we've been building our regional teams. So in the second quarter, we pilot tested it in Shenzhen and now we are rolling it out in a few more city.
To further test this topic.
No I don't.
No I'd say that it's still early stage, but then when you look at the fine.
Now pay later model its pricing globally, but I do think that there is some potential in China and mission, it's definitely one of the leading players.
Area.
How does he wont be thank you.
Your next question comes from Jackie as do all of China Renaissance. Please ask your question.
Okay shape anytime Oh cheaper cheaper.
T jewelry, Josh deeply sure glad you're not guidance, but it's something that you do that you should get sure you correctly cause somebody to keep them at MTN Peter your guidance.
Chico achievable.
Sure Great.
Sean It's always high on the Condor is essential to the <unk>.
So my Angiogenic guidance.
So questions now that you've had.
John.
Cargo into you sure Gwen.
Thank you too.
<unk> <unk> pump.
So you could either eaglet you should learn.
I think what you should see a sharp a take rate Oh, what did he choose that Georgia.
She forgot joggers charter Chico Changzhou.
No. It's Sean she got a shot to consent to do so far kind of dollar tree the volume does she quote.
No so the answer to Peter Archie good essentially.
So should I take the Chico's brand volume you would see if we should have any additional shipping.
Downhole, HR, though cloud, Brazil transaction treating pressure towards the tundra.
Essentially what <unk> accomplished.
<unk>.
And our whole geographically income now that you could actually take the take rate.
Central to the hold you hold your shares.
Hello, Chico, California shelter.
That's what he said no no.
Maybe you could go to the Gulf coast that cohort actually attempted that extra bushel.
Thank you John.
So I have two follow up questions number one is also about that product.
Uh huh.
Starting to.
Assembly, our regional teams for my yacht.
Do we have any <unk> guidance for the third quarter.
And second question is about also the third quarter.
So far.
Baldwin and HCR.
We are.
Color so for the for the long haul and so far what.
What is do you expect to belden compared with the second quarter and also based on my understanding what we are seeing all of our maybe start to adjust.
The ATR so.
THR level in the third quarter.
And how would that impact our net take rate.
And also what is the percentage of the high risk customers base.
Based on our estimate thank you.
Okay.
So although it wasn't my yoga launch is a woman to us at all can answer.
So I think if you look at it.
You do a yo Yo.
So it's not just a woman.
Sorry, if I answered all women go ahead, although well because if that's what you can tell what other things are there you got a 10 day well. That's also center. So that's all well Amanda Thank you got it.
Although there's a lot of things that will make a little bit.
Although I.
Hopefully youll go why is that.
Got it.
So it's all within a day.
Thank you for all that.
Hello, Paul.
His handlebars they sell most of our lingo they'll go to I think what people were thinking.
I kind of will move.
You guys got them in Colorado, because it would be.
And people will be hydrogen is another.
No.
Oh My Yeah, we do expect meaningful increase from second.
As I said earlier, we've been building our team and the city and go.
Washington, but of course more meaningful.
Now to complete that build out.
At the moment, we do see meaningful increase Q on Q and also we're trying to bring more cooperation agreement.
Hey, guys I just the woman.
Uh huh.
Dr Oklahoma.
And karla.
Well, it's essentially because of that charter so its all women.
So that's what I hope Youll see if again it hasn't done.
Well then that's it.
Think of the APR until you do sort of tone to the biota.
She has empire.
So that caused a shutdown so what's gonna take a pause because I also want to do so with all that.
Hopefully you got lots of good stuff like that I don't know what can I tell you. What it is you also have to address that.
So it doesn't matter what other women in the US most of them in particular it seems like it is a well known said you're going to try to tell you a whole well mature.
Well, let's just answer that.
Yes, yes.
Okay.
That's intentional woman cant calibrate, let us as yet.
One woman and good are you guys. How long you hold the phone yeah, hi male female.
So there's a tendency and I kind of within a tight tight because I saw that.
Okay.
That is to do it.
Neil.
So somebody onto the world actually at that level.
So just what I said in China, and one to the dollar.
On your second question about the APL and <unk> right.
Started adjusting our business that's been that's the policy I came out and in July and August.
<unk> has been.
We are in a downtrend.
And it has led to a lower attack rate, but of course in this adjustment process. Our risks have also been improving so therefore, the risk cost would be lower.
But you know how it's a bit too early to say because we only started as a perfect youre not going to see.
Any immediate like numbers any immediate results, but we do expect that once we complete this process, we'll be able to get a better risk and we will be able to maintain our profitability.
Alright.
G SEC.
Yes.
So ashwin.
Yeah.
How do you kind of it would you show a man and kill Sunday called Centennial could you go through Covid.
And he told me she another two months Ah shall women kind of sure.
We found him to the Gulf continue doing things so are sitting now you're showing a $29 <unk>.
<unk>. So you should put up and you should see.
And <unk>, which are down you may become good Chico in sell through and we should have on me and he was just one element.
Certainly we could have a positive other income to shoot colon to U 210, coughing in detail even with high IMU.
Also the kind of which we can.
<unk> digital and key part of Hong Kong, which was anything that you think the <unk>.
Sure I mean, it seems in cocoa.
He may want to say it contains a J it tell them, it's usually Archie Tianjin Beijing 10 vehicles poorly. So you can sort it out and put them in the whole code one.
AUM Dutch on Gulf wind and solar and all the children.
I think a PDF and Tony Atala toilet tissue product line going forward for you should we foresee it seems on the 200 that we team with Tim Hauck <unk>.
This is cornell.
I'll tell you about <unk> and then <unk> would have something sooner.
<unk> put in Gulf of Mexico.
We'll put up the REIT halfway between humans legal settlements you Jim agent could afford aren't doing that.
You'll be unintended yugo.
Pampa.
On your third.
Question about the high risk right.
Yeah.
At the moment, if you look at I think alcohol that with actually pricing right about 24% this portion.
Less than 10%.
And in it and in Q3, we have already started shipping again, though that's pod and.
And let me talk about how we did it in terms of our existing customers and also new customers.
All existing customers.
We do expect higher.
Hi, define some difficulty in the repayment on a Wednesday and liquidity I guess that Titan.
We're going to manage them through a continuous.
Monetary, but at the same time.
When you look at our new customers.
We have fine tuned our strategy in terms of like customer acquisition acquisition, you know my third out of fermentation and in terms of when you get new risks that we all cry with Macquarie It would be much better quality as a result.
Pleased to be able to offset the risk coming from the existing therefore.
Therefore, we do expect NIM on April performance.
Sure David.
Once again, if you wish to ask a question. Please press star.
One on your telephone keypad and wait for your name to be announced.
Once again it is star and one if you wish to ask a question.
Yeah.
Okay.
Yeah.
Operator, once again became yeah.
Yeah, I think we can wrap up the call here if there's any further questions. We can always and continue our offline.
Thank you Les.
Ladies and gentlemen that does conclude the conference call for today. Thank you for participating you may.
I'll disconnect.
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Yeah.
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