Q3 2023 LexinFintech Holdings Ltd Earnings Call

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Speaker 1: Good day and thank you for standing by. Welcome to Leasington Tech's third quarter 2023 earnings conference call.

Good day and thank you for standing by welcome to listing syntax third quarter 2023 earnings conference call.

Speaker 1: At this time, all participants are in a listen-only mode.

At this time all participants are in a listen only mode.

Speaker 1: After the speaker's presentation, there will be question and answer sessions.

After the Speakers' presentation, there will be question and answer session.

Speaker 1: To ask a question during the session, you will need to press star 1, 1 on your telephone. You will then hear an automated message revising your hand is raised.

Ask that question. During this session you will need to press star one one on your telephone you wouldn't hear an automated message advising your hand is raised.

Speaker 1: To withdraw your question, please press star 11 again.

To withdraw your question. Please press star one again.

Speaker 1: Please be advised today's conference is being recorded.

Please be advised that today's conference is being recorded.

Speaker 1: It is now my pleasure to hand you over to the IR Director, Ms. Mandy Doan. Please go ahead and map.

It is now my pleasure to hand, you over to the IR Director Ms. Mandy Dong. Please go ahead ma'am.

Speaker 2: Thank you, Amber. Hello, everyone. Welcome to the third quarter 2023 earnings conference call. Our results were issued earlier today and can be found on our IR website.

Thank you <unk> Hello, everyone welcome to <unk> third quarter 2023 earnings Conference call I'll read Dallas was issued earlier today and can be found on our IR website.

Speaker 2: Joining me today are our CEO Jay Xiao, President Jared Wu, and CFO James Jung.

Joining me today, our CEO Jay shell.

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Speaker 2: Before we get started, I'd like to remind you of our Safe Harbor statement in our earnings press release, which also applies to this call. During the call, we may refer to business outlook and forward-looking statements, which are based on our current plans, estimates, and projections.

Before we get started I'd like to remind you of our safe Harbor statement in our earnings press release, which also applies to this call. During the call. We may refer to business outlook and forward looking statements.

Which are based on our current plans estimates and projections.

Speaker 2: The actual results may differ materially and we undertake no obligation to update any forward-looking statements.

Actual results may differ materially and we undertake no obligation to update any forward looking statements.

Speaker 2: Thus, unless otherwise stated, all figures mentioned are in RMB.

Unless otherwise stated all figures mentioned are in RMB.

Speaker 2: Jay will first provide an update on our overall performance. James will cover the financial results in more detail.

Jay will first provide an update on our overall performance James will cover the financial results in more detail.

Speaker 2: And lastly, Jared will then discuss risk management.

And the lastly, Jerry well then discuss risk management.

Speaker 2: I will now turn the call over to Jay. His remarks will be in Chinese, and the English translation will follow.

I will now turn the call over to Jay his remarks will be in Chinese and English translation will follow.

Speaker 3: Audience in Chinese

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Speaker 2: Hello everyone, it's a pleasure to share with you our performance for the third quarter of 2023.

Hello, everyone. It's a pleasure to share with you our performance for the third quarter of 2023.

Speaker 3: Thank you for your attention.

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Speaker 2: In the face of the current industry-wide and macroeconomic challenges, we adopted a prudent and steady strategy in the third quarter. Despite a slight volatility in asset quality, we reasonably tightened our risk strategy to balance growth and quality.

In the face of the current industry wide and macro economic challenges.

Adopted a prudent and a steady strategy in the third quarter.

Despite a slight volatility in asset quality were reasonably tightened our risk strategy to balance growth and the quality.

Speaker 2: In the third quarter, we adhered to the dual wheel drive of risk and data, pushed forward the refinement of operation, and continued to strengthen our fundamental capabilities, providing another solid road performance.

In the third quarter, we adhered to the do we all drive of risk and data pushed forward the refinement up operations and the continued to strengthen our fundamental capabilities recording and novel solid relative performance.

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Speaker 2: Transaction volume was RMB $63.3 billion, up 13% year-over-year. Loan balance under management was RMB $120.7 billion, up 28% year-over-year. Revenue was RMB $3.5 billion, up 30.4% year-over-year.

Transaction volume was RMB $53 3 billion up 13% year over year loan balance on the management was RMB $120 7 billion up 28% year over year.

Revenue was RMB three 5 billion.

34% year over year.

Speaker 2: Net profit with RMB $371 million up 34.4% year-over-year.

Net profit was RMB $371 million up 34, 4% year over year.

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Speaker 2: In the third quarter, the effectiveness of both new customer acquisition and existing customer operation was further improved.

In the third quarter.

Back to the needs of both new customer acquisition and existing customer operation with further improved.

Speaker 2: The synergies between e-commerce and the consumer credit business were further enhanced and the tech empowerment business continued to grow, with its commercialization capability being validated, and we are accelerating its expansion.

The synergies between e-commerce, and the consumer credit business will further enhance and attack empower mats business continued to grow with its commercialization capability being validated and we are accelerating is expansion.

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Speaker 3: There are three highlights of the performance of the third quarter. First, the optimization of the operating system has improved the efficiency of new customers and old customers. In the third quarter, the company has made major upgrades to the new customer model and strategy, which has achieved a more significant effect. The efficiency of information flow acquisition has increased by 38.5% compared to the previous quarter. The pass rate of new customers and the number of transactions has also increased.

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Speaker 2: There were three main highlights of the third quarter results.

There were three men highlights of the third quarter results.

Speaker 2: Firstly, refined operations have led to improved efficiency in both acquiring new customers and managing existing ones.

Firstly refined operations have led to improved efficiency in both acquiring new customers and managing existing one.

Speaker 2: In terms of new customers, we made a major upgrade on our new customer acquisition model and strategy in the third quarter, resulting in notable achievements.

In terms of new customers, we made a major upgrade of our new customer acquisition model and our strategy in the third quarter, resulting in notable achievements.

Speaker 2: The efficiency of attracting customers through feed channel increased by 38.5% compared to the first quarter. The approval rate, number of drawdown borrowers, and the facilitated loan volume for new customers all showed improvements of over 20% compared to the control group.

The efficiency of attracting customer they will feed channel increased by 38, 5% compared to the first quarter.

Approval rate number of drawdown borrowers and facilitated the loan volume, but new customers all showed improvement of over 20% compared to the control group.

Speaker 2: Additionally, early stage delinquency indicator decreased by nearly 20%.

Additionally, early stage delinquency indicator decreased by nearly 20%.

Speaker 2: We expect both the skill and quality of new customers to continue to benefit in the fourth quarter.

We expect both the scale and quality of new customers to continue to benefit in the fourth quarter.

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Speaker 3: This has further boosted the advantage of the offline direct-to-customer model and pushed the overall cost of customers to fall. In the third quarter, sales and costs fell by 9.4% compared to the second quarter. We see that there is still a lot of room and opportunity for offline growth in the future, and we will continue to strengthen this unique operating model.

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Speaker 2: In the third quarter, we further enhanced our offline customer acquisition capability.

In the third quarter, we further enhance our offline customer acquisition capabilities.

Speaker 2: This included upgrading the organizational structure of the offline inclusive finance, in Chinese, Puhuiqin. Improving the sales management system, strengthening the cultivation of standardized talents, and enhancing the ability to accurately identify offline customers.

This included upgrading the organizational structure of the offline inclusive finance in Chinese pool quite team improving the sales management system strengthening the calculation of standardized the talent and the in housing the ability to accurately identify offline customer.

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Speaker 2: These efforts solidified the advantages of our offline direct customer acquisition model, resulting in a decrease in overall customer acquisition costs.

These efforts solidified the advantages of our offline direct customer acquisition model, resulting in a decrease in overall or customer acquisition cost.

Speaker 2: Sales expenses in the third quarter declined by 9.5% compared to the second quarter. We see more potential and opportunities for offline growth in the future and we'll continue to deepen our presence in this unique business model.

Sales expenses in the third quarter declined by nine 5% compared to the second quarter.

We see more potential and opportunities for offline growth in the future.

We'll continue to deepen our presence in this unique business model.

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Speaker 3: We have improved the model framework for the whole life cycle from customer risk management. The durability and stability of the model has improved from 10% to 20% compared to the previous version.

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Speaker 2: In terms of existing users, we maintained a steady operation and strengthened the underlying capability building for model application, further enhanced our service capability.

In terms of existing users, we maintained a steady operation and strengthened the underlying capability building for model application.

Whether in house, our service capabilities.

Speaker 2: During the quarter, we introduced more data sources and built an identification system centered around the credit system of PBOC.

During the quarter, we introduced more data sources and acute and identification system.

Around the credit system of PB Oc.

Speaker 2: we improve the model framework for the entire customer acquisition, risk management, and operational lifecycle.

We improve the model framework for the entire customer acquisition risk management and operational lifecycle.

Speaker 2: the sequencing and the stability of the model were improved by 10% to 20% over the previous version.

The sequencing and the stability of the model were improved by 10% to 20% over the previous version.

Speaker 3: In the third quarter, we use corporate WeChat to operate users. We have accumulated 700,000 fans so far, which has improved service efficiency and satisfaction. We use corporate WeChat to operate high-quality customers in detail. In traditional mode, customer orders increased by 65%, and transactions increased by 107%.

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Speaker 2: In the third quarter, we utilized the enterprise WeChat for user operations, which has accumulated 700,000 borrowers. And improved service efficiency and satisfaction.

In the third quarter, we utilized the enterprise wechat for user operation, which has accumulated several hundred thousand borrowers.

The improved service efficiency and satisfaction.

Speaker 2: Through refined operations, target high quality customer groups via enterprise WeChat, compared to the traditional method. We achieved a nearly 65% increase in customer order rates and 107% increase in transaction volume.

Through a refined operations target high quality customer groups by our enterprise Wechat compelled to the traditional method, we achieved a nearly 65% increase in customer order rates and the 100.

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Speaker 3: Samsung has made good progress in acquiring Leginka, a product with a price tag of 18% or lower for high-end customers.

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Speaker 3: After using Lejin Card, users' orders and transaction fees have significantly increased. The order rate, per capita transaction fee, and total transaction fee are more than 80% higher.

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Speaker 3: It has effectively improved the activity of high-quality generation customers and promoted the retention of more high-quality lost users, broadening the scope and space of our high-quality user experience.

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Speaker 2: In the third quarter, our product, Le Jin Cart, priced below 18.18%, and targeted towards high-quality customer segments, delivered satisfying progress.

In the third quarter, our product like in Cod priced below 18, one 8% and the targeted towards high quality customer segments.

Levered satisfying progress.

Speaker 2: After using LejinCard, users' willingness to place orders and the transaction volume has been significantly improved. The order rate, average transaction volume per person, and the total transaction volume all experienced around an 80% increase.

After using the card users willingness to place order and the transaction volume has been significantly improved the <unk>.

Other rate average transaction volume per person and the total transaction volume all experienced around and 88 zero percent increase.

Speaker 2: This effectively enhanced the engagement of high quality active borrowers and facilitated the return of more high quality settled users, expanding the scope and opportunities for managing our premium user base.

This effectively in house, the engagement of high quality active borrowers and facilitated the return of more high quality set of users expanding the scope and the opportunity for managing our premium user base.

Speaker 3: The second highlight is that the ecological business continues to grow, and the co-operative effect is further enhanced. First of all, it is the tree business. After achieving record profits in the fourth quarter of last year, the tree business scale has further increased. In the third quarter, the return on investment increased by 59%. After two years of exploration, the tree business has completed the upgrade of the solution, and the product verification is more diversified. The standard ability of system and delivery is verified, and the approval of multiple wholesalers and agribusinesses is obtained.

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Speaker 2: The second highlight with the continued growth of the leucine ecosystem and the further enhancement of synergy.

The second highlight with the continued growth of the washing ecosystem and the further enhancement of synergies.

Speaker 2: Firstly, the tech empowerment business, after achieving quarterly profit in the fourth quarter of last year, the scale of this business line grew further with a 59 sequential increase in the third quarter.

Firstly, the test empowerment business.

After achieving quarterly profit in the fourth quarter of last year. The scale of this business lines grew further with <unk>.

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Speaker 2: After nearly two years of exploration, we have completed upgrades in solutions, diversified our product portfolio, and validated the standardized capabilities in systems and deliverables, which was well recognized by multiple urban and rural commercial banks.

After nearly two years of exploration, we have completed upgrades in solution diversified our product portfolio and the validated the standardized our capabilities in systems and deliver those.

What well recognized by multiple urban and rural commercial banks.

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Speaker 3: The number of customers is not much in the overall business of Lexin. But the industry supervision continues to dilate. With the consumption of new generation market interest rates falling, the number of customers business can help banks to quickly sell new generation digital transformation. The market potential is huge. It can also bring better coordination to new generation funds. Promote Lexin to better cooperate with other institutions and have more deep-level cooperation. At present, the number of customers business is accelerating expansion. Lexin will cover more Chenrong Supermarket.

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Speaker 2: The 59 growth rate further validated the commercialization capability of our tech empowerment business.

The 59 gross rate further validated the commercialization capability of our tech empowerment business.

Speaker 2: although it currently accounts for a small proportion of Luoxin's overall business.

The only currently account for a small proportion of Lou I think over all of our business.

Speaker 2: In the context of increasingly refined industry regulations and a downward trend in consumer credit market interest rate and tech empowerment business can help banks quickly undergo retail credit digitalization transformation with tremendous market potential.

In the context of increasingly refined industry regulations, and the downward trend in consumer credit market interest rate and Tad empowerment business kind of held banks quickly undergo retail credit digitalization transformation with tremendous market potential.

Speaker 2: It can also bring better synergy to funding cooperation and drive deeper and broader collaboration between Lexin and financial institutions.

It can also bring better synergy so funding cooperation and drive deeper and a brother collaborations between the vaccine and the financial institution.

Speaker 2: Currently, the Tech Empowerment Business team is accelerating its expansion and will cover more CT and rural commercial banks to further expand the scale.

Currently the Tad empower members knit team is accelerating is expansion and we'll cover more city and the rural commercial banks to further expand the scale.

Speaker 3: Second, e-commerce has shown great value in attracting new customers and active old customers, and has further strengthened its co-operative effect with the new generation of consumer business. Third, e-commerce mobile phone taste continues to consolidate.

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Speaker 3: Apple, T1 and Huawei L1's highest-level authorization. It maintains an advantage in the first batch of rare goods, further enriching the user consumption of the distributed market. Take Huawei as an example. In the third quarter, the sales of the new Mate 60 X5 rose by about 60% year-on-year compared with the sales of the Mate 50 last year.

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Speaker 2: Secondly, our e-commerce business brought out more value in terms of customer new acquisition and activating existing ones, further enhancing the synergies with our core consumer credit business.

Secondly, our ecommerce business brought out more value in Thomas.

Customer new acquisition and activating existing wants further in housing the synergies with our core consumer credit business.

Speaker 2: In the third quarter, our e-commerce division continued to solidify its highest-level authorization for Apple T1 and Huawei L1.

In the third quarter, our E Commerce Division continued to solidify its highest level authorization for F. O T, one and Huawei <unk>, maintaining advantages in skills and initial supply.

Speaker 2: Maintaining advantages in skills and initial supply.

Speaker 2: This further boosted consumer spending on our e-commerce platform.

This further boosted consumer spending on our e-commerce platform.

Speaker 2: Taking Huawei as an example, sales of the new Mate 60 series and the X5 reached a record high for the year in the third quarter with an approximately 60% increase in revenue compared to last year's Mate 50 product.

Taking Huawei as an example, some of the new make 60 series and the X five reached a record high for the year in the third quarter with approximately 66 zero percent increase in <unk>.

Revenue compared to last year's made 50 product.

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Speaker 2: In addition to our strengths in the consumer electronics 3C category, we introduced more high-quality new brands and merchants onto our platform in the third quarter. Covering categories that are favored by young generation, such as luxury goods, sports, and pet goods. The number of new merchants reached 241, representing a sequential growth of 51% in brand coverage.

In addition to our strength in the consumer electronics category we.

Introduced the more high quality, new brands and the merchants onto our platform in the third quarter covering categories that are favored by young generation, such as luxury goods spot and packet.

The number of new merchants reached 241, representing a sequential growth of 51% in brand coverage.

Speaker 3: With the entry of more business owners and the expansion of the product line, a large number of users are being fired, which brings a mutual impact on e-commerce and consumer credit business. During the Double 11, the e-commerce consumer population has grown significantly, which has significantly increased the turnover of consumer credit users, and the return has increased by about 12.4%. At the same time, active customers of consumer credit have further boosted e-commerce consumption to form a cycle-enhancing business ecosystem.

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Speaker 2: With the addition of more merchants and expansion of product categories, a large number of existing users have been activated, leading to a simulation between e-commerce and the consumer credit business. During the Double 11 Shopping Festival, the period from November 1st to 11th, the growth in the e-commerce consumer base resulted in a notable increase in transaction volume from high-quality active customers.

With the addition of more merchants and expansion of product categories. A large number of existing users have been activated leading to us stimulation between e-commerce and the consumer credit business. During the double 11 shopping festival the period from November 1st.

11th to growth in the E Commerce consumer base resulted in a notable increase in transaction volume around high quality active customer.

Speaker 2: level R1 to R3 with a sequential increase of approximately 12.4%. At the same time, these active consumer credit user further drove e-commerce spending, creating a reinforcing cycle within our business ecosystem.

Several or want to operate with a sequential increase of approximately 12, 4% at the same time. These active consumer credit user so that drove e-commerce spending, creating a reinforcing cycle within our business ecosystem.

Speaker 3: The third highlight is data-driven quality improvement, and further enhancement of profitability. In the third quarter, we adopted a series of data-driven methods to improve operating efficiency. These measures include increasing the precision of data-driven tools such as application user life cycle global models. Through decision-making models, system-enhanced capital-to-asset matching, as well as improving user return on investment, in addition to this, we continue to promote quality improvement, and we have reduced the total cost of Q3 by 7%.

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Speaker 2: The third highlight is the data-driven approach to improve quality and efficiency, further enhancing our profitability.

Third highlight if that data driven approach to improve quality and the efficiency further enhancing our profitability.

Speaker 2: In the third quarter, we implemented a series of data-driven measures to improve our operational efficiency.

In the third quarter, we implemented a series of data driven measures to improve our operational efficiency. These.

Speaker 2: These measures included applying data tools such as user lifecycle models to strengthen precision operations, enhancing the efficiency of funds and asset matching through decision simulation systems, and improving the customer retention rate for settled users.

These measures included applying data tour, such as user lifecycle models to strengthen procedure operation in housing the efficiency offence and added matching <unk> simulation systems, and improving our customer retention rate for Saratoga users.

Speaker 3: The drop in capital costs further improves the company's capabilities. In the third quarter, the company achieved major optimization of the capital structure and strategic cooperation with multi-stakeholder banks. The capital cost re-created a new low, a 21-percent drop in return.

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Speaker 2: The drop in funding cost has further improved profitability. In the third quarter, the company achieved significant optimization of our funding structure and entered into strategic partnership with multiple major banks, including national-wide joint stock banks. Funding costs reached a new record low, a 21-fifth drop on a Q-on-Q basis.

The drop in funding cost has further improved profitability in the third quarter. The company achieved significant optimization of our funding structure and entered into a strategic partnership with multiple major banks, including national wide joint stock banks funding costs reached a new record.

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Speaker 3: We are committed to the high speed development of our business, and we will continue to invest in technology and R&D. We have invested 1.27 billion yuan in R&D in the third quarter, and we will continue to lead the industry. We have invested in R&D in the third quarter, and we will continue to lead the industry.

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Speaker 3: data, training, and business data, we have accelerated the landing of AI model in the company. Business interoperability has been fully landed in the main business processes, such as e-commerce, customer service, and retail. In terms of productivity improvement, we have widely applied it in the field of development code support, design and creative production, data analysis, and so on, to improve the overall operating efficiency of the company. In terms of control core, we continue to pay attention to and actively explore the risks of AI model.

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Speaker 3: core areas, which greatly improves the overall operating efficiency and customer satisfaction of the company.

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Speaker 2: The rapid development of our business also relies on continuous investment in technology and the research and development. In the third quarter, our company invested RMB 127 million in research and development, maintaining our industry-leading position.

The rapid development of our business also relies on continued investments in technology and the research and development.

In the third quarter, our company invested RMB $127 million in research and development, maintaining our industry leading position.

Speaker 2: During the quarter, we accelerated the development of the use case of AI large language models in our business through exclusive data pre-training and fine-tuning of business data. In terms of business applications, we have already fully implemented the AI model in key business processes such as telemarketing, customer service, and loan collection.

During the quarter, we accelerated the development update use case of AI Lodge language models in our business through exclusive data for training and the fine tuning of business data.

In terms of business application, we have already fully implemented the AI model in key business processes, such as Kelly marketing customer service and the loan collection.

Speaker 2: In terms of working tools, the AI model is widely applied in scenarios such as coding assistant tools, generating design ideas, and data analysis, enhancing the overall operational efficiency of the company.

In terms of working toward the AI model, it's widely applied in scenarios, such as coding assistant tours generating design ideas and data analysis in housing the over or operational efficiency of the company.

Speaker 2: In terms of risk management, we are closely watching the industry trend and actively exploring the use case of AI large language models. These initiatives have significantly improved the overall operational efficiency and the customer experience.

In terms of risk management, we are closely watching the industry trend and actively exploring the use case of AI large language models. These initiatives have significantly improve the overall operational efficiency and the customer experience.

Speaker 3: With solid technical advantages, China's service industry has been selected 500 times in the third quarter. China is the only company in the financial technology industry to be selected four times.

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Speaker 2: With solid technology advantages, in the third quarter, Lexin has been selected for the fourth time as one of the top 500 Chinese service companies, making us the only fintech company on the list for the fourth time.

Solid technology added hedges in the third quarter looking ahead.

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Speaker 3: In terms of corporate social responsibility, in the third quarter, we will make a new upgrade to the consumer rights protection measure. In the 5S protection system, we will improve data security management, improve anti-fraud protection capabilities, enhance smart customer service applications, and strengthen the financial and black market crackdown. These are the four measures to build a comprehensive safety and protection framework for consumers.

Thank you.

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Speaker 2: In terms of corporate social responsibility, in the third quarter, we made major upgrades to our consumer rights protection measures.

In terms of corporate corporate social responsibility in the third quarter, we made a major upgrade to our consumer rights protection measures.

Speaker 2: Upon the foundation of our 5S Guardian System, we have carried out four major initiatives.

The foundation of our fight as Guardian system, we have carried out four major initiatives.

Speaker 2: One, strengthening our data security management system. Two, enhancing anti-fraud protection capability.

One strengthening our data security and management system to in housing anti fraud protection capabilities.

Speaker 2: 3. Expanding intelligent customer service applications, and 4. Intensifying efforts to combat illegal anti-collection groups.

Three expanding intelligent customer service application and for intensifying efforts to combat illegal anti collection groups.

Speaker 2: These measures collectively established a comprehensive safety firewall for consumers.

These measures collectively established a comprehensive safety fire war for consumers.

Speaker 3: In August of this year, Lexin intercepted 1.6 billion data security attacks. Data protection and governance systems have maintained a record of zero data leaks since the launch. Anti-fraud systems have accumulated a total loss of more than 4.7 billion yuan.

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Speaker 3: We will continue to push for the reduction of risk and increase the quality of assets. We will maintain a balance between the size of the transaction and the quality of assets. The company will maintain the annual transfer of RMB2,450 billion to RMB2,550 billion, with a growth of 20% to 25%.

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Speaker 2: From January to August this year, Lexin intercepted 160 million instances of data security attacks, maintaining a record of zero data leaks since the launch of the data protection and governance system.

From January to August this year, the Athene intercept at 160 million instances of data security attacks, maintaining a record of zero data lakes since the launch of the data protection and the governance system. The Antifraud system has prevented.

Speaker 2: The anti-fraud system has prevented potential user losses for over 470 million RMB and the customer satisfaction has reached 99.6%.

Potential user logic for over 217 million RMB and customer satisfaction has reached 99, 6%.

Speaker 2: Looking ahead to the fourth quarter, in the face of a complex and uncertain external environment, we will adhere to the principle of prudent operation and prioritize risk management. We will continue to enhance risk management capabilities and improve asset quality while striking a fine balance between transaction volume and asset quality.

Looking ahead to the fourth quarter in the face of a complex and uncertain external environment we.

We are adhered to the principle of prudent operation and to prioritize risk management.

They'll continue to in house risk management capabilities, and improved asset quality, while striking a fine balance between transaction volume and asset quality.

Speaker 2: We maintain the guidance on full-year loan origination we gave earlier this year, ranging from RMB $245 billion to $255 billion, representing a 20 to 25 percent year-over-year growth.

We maintained the guidance on full year loan origination we gave earlier this year ranging from RMB 245 billion to 255 billion, representing a 20% to 25% year over year growth.

Speaker 2: ???,???????????CFO,?? Next, I will pass to our CFO for financial update.

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We'll pass to our CFO.

For financial update.

Speaker 4: Thank you, Jay. I will now provide more details on our financial results. Please note that all numbers are in RMB unless otherwise stated.

Thank you Jay I will now provide more details on our financial results. Please note that all numbers are in RMB unless otherwise stated.

Speaker 4: In the face of a sluggish macroeconomic environment and a subdued consumer confidence, we have sustained our growth for the sixth straight quarter, signaling a robust V-shaped recovery since the first quarter of 2022.

In the face of a sluggish macro economic environment, and a subdued consumer confidence.

We have sustained our growth for the sixth straight quarter signaling a robust V shaped recovery since the first quarter of 2022.

Speaker 4: Our focus on improving risk management capability, customer upgrading, operational refinement, co-operative initiatives, and optimizing our funding, particularly by lowering the early repayment rate, has prepared us for.

Our focus on improving risk management capability customer upgrading operational refinement.

Coffee initiatives and optimizing our funding, particularly by lowering the early repayment rate.

Has propelled us forward this quarter.

Speaker 4: Amidst the ongoing economic uncertainties, our strategy has been prudent.

Amidst the ongoing economic uncertainties, our strategy has been prudent.

Speaker 4: we have moderated new loan originations to prioritize asset quality and conservatively made ample provisions in our financials, which, while impacting us in the near term, supports our long-term financial health.

We have moderated new loan originations to prioritize asset quality and conservative we've made ample provisions financials, which was impacting us in the near term support us our long term financial health.

Speaker 4: To provide some context, first let's take a look at the year-over-year number of comparisons.

To provide some context first let's take a look at the year over year number comparisons.

Speaker 4: Total loan origination increased by 12.7% year-over-year to $63.3 billion.

Total loan origination increased by 12, 7% year over year to $63 3 billion.

Speaker 4: Revenue climbed to $3.5 billion, up 30.4% year-over-year, largely due to reduced early repayments and larger outstanding loan balance, now at $121 billion.

Revenue climbed to $3 5 billion up 34% year over year, largely due to reduced early repayments and the larger outstanding loan balance now at 171 billion.

Speaker 4: Notably, we significantly cut the early repayment ratio in Q3 to a level at about 90% of Q2's level and aim to keep it optimal in Q4.

Notably we significantly cut the early repayment ratio in Q3 to a level at about 90% of Q2's level and aim to keep it optimal in Q4.

Speaker 4: The average weighted APR remained under 24%, with loans below this threshold comprising 86% of total loans. Up over 5%

The average weighted APR remained under 24% with low below this threshold comprising 86% of total loans.

Up over 5% from last year.

Speaker 4: Our funding cost hit a record low of 6.4%, down from 7.0% last year, attributable in part to successful partnerships with the national banks, which we anticipate will further reduce costs.

Our funding costs hit a record low of six 4% down from 7.0% last year.

Attributable in part to successful partnerships with the National banks, which we anticipate will further reduce costs.

Low tenders decreased as we fine tuned our portfolio structure in response to market uncertainty, averaging 13, one months compared to 38.

Speaker 4: Loan tenders decreased as we fine-tuned our portfolio's structure in response to market uncertainty, averaging 13.1 months compared to 13.8 in Q3 of 2022.

In Q3 of 2022.

Cost efficiencies continue with operating expenses, including processing and services sales and marketing R&D and G&A.

Speaker 4: Cost efficiencies continue with operating expenses, including processing and services, sales and marketing, R&D, and G&A.

Speaker 4: falling to 0.91% of the average loan balance, a 35 basis point savings.

Falling 2.91% of the average loan balance.

A 35 basis points saving from the previous year.

Speaker 4: Consequently, that income rose to $371 million, a 34.4% increase year-over-year, improving our debt margin to 10.6%.

Consequently, net income rose to 371 million a 34 four.

4% increase year over year.

Improving our margin to 10, 6%.

Despite the heightened provisions the increase underscores our resilient profitability and the business momentum.

Speaker 4: Despite the heightened provisions, the increase underscores our resilient profitability and the business momentum.

Speaker 4: Apart from the above year-over-year analysis, I would also like to share some perspectives from quota-over-quota comparison.

Apart from the above year over year analysis, I would also like to share some perspectives from quarter over quarter comparisons.

Total G&A remained relatively stable as we balanced maintaining asset quality with business growth.

Speaker 4: Total GME remained relatively stable as we balanced maintaining asset quality with business growth.

Speaker 4: A slight take-away improvement reflects effective early repayment control and reduced funding costs, although offset by pricing reductions, shorter loan durations, and additional provisioning.

A slight take rate improvement reflects effective early repayment control and reduced funding costs, although offset by pricing reductions short term loans.

Durations and additional provisioning.

Yeah.

Speaker 4: Risk management remains a cornerstone strategy, yet factors like the slow economic recovery and challenges within the loan collection industry have slightly affected the asset quality, as reflected in metrics such as day one delinquency rate, M1 collection rate, and 90 days delinquency rate.

Risk management remains a cornerstone strategy.

Factors like the slow economic recovery and challenges within the loan collection industry have slightly affected the asset quality as reflected in metrics such as <unk>.

One delinquency rate and one collection rate and 90 days delinquency rate.

Speaker 4: For instance, over 90 days, the delinquency rate in Q3 was 2.67%, which is slightly higher.

For instance, our 90 days delinquency rate in Q3 was $2 six 7%, which is slightly higher.

Speaker 4: in comparison with 2.59% in Q2.

In comparison with 259% in Q2.

Speaker 4: Nonetheless, we have adjusted our VAT debt provisions, reaching a coverage ratio of approximately 350%.

Nonetheless, we have adjusted our bad debt provisions, reaching a coverage ratio of approximately 350%.

Speaker 4: which is defined as the total provision amount divided by the principal amount of 90 days delinquent loan.

Which is defined as the total provision amount divided by the principal amount of 90 90 days delinquent loans.

Speaker 4: The current fluctuation in asset quality across industry seems to continue to cloud Q4. We are vigilant and have taken all measures to safeguard our asset quality level.

The current fluctuation in asset quality across industry seems to continue to cloud Q4.

We are vigilant and have taken measures to safeguard our asset quality level.

Speaker 4: Operating expenses fell by 7.2% from the last quarter, primarily from reduced sales marketing and the general administrative spending.

Operating expenses fell by seven 2% from the last quarter, primarily from reduced sales and marketing and general administrative spending.

Speaker 4: With the increased provisions from Q2, we still achieved a 4.2% sequential growth in net income and maintained a 10.6% net margin.

We've increased provisions from Q2, we still achieved a four 2% sequential growth in net income and maintained a 10.6% net margin.

Speaker 4: From both year-over-year and quarter-over-quarter perspectives, we have made significant improvements during Q3. Although macro headwinds persist, we have maintained the rebounding pace of our business and anticipate the business growth momentum to continue.

From both year over year and quarter over quarter perspective, we have made significant improvements during Q3.

Although macro headwinds persist we have maintained the rebounding pace of our business and anticipate the business growth momentum to continue.

Let's review some specific financial items.

Speaker 4: Total operating revenue hit $3.5 billion for Q3, with an increase of 14.8% quarter-over-quarter and a 30.4% year-over-year.

Total operating revenue hit $3 5 billion for Q3, with an increase of 14, 8% quarter over quarter and 34% year over year.

Speaker 4: driven mainly by the credit facilitation business, which saw a significant increase, both quarterly and annually.

Driven mainly by the credit facilitation business, which saw a significant increase both quarterly and annually.

Speaker 4: Tech empowerment services also grew, while installment e-commerce platform service revenue declined due to the high Q2 numbers driven by the 618 promotion and an accounting reclassification.

Pick empowerment services also grew.

While installment E Commerce platform service revenue declined due to the high Q2 numbers driven by the six one age promotion.

And an accounting reclassification.

Speaker 4: Despite all of this, the e-commerce GMV grew by 12.8% year over year.

Despite of all of all this the E Commerce team GMB grew by 12, 8% year over year.

Speaker 4: Expense ratio demonstrates our continued progress in cost optimization, notably in marketing, where we have achieved greater efficiency and lower customer acquisition costs.

Expense ratio demonstrates our continued progress in cost optimization, notably in marketing.

We have achieved greater efficiency and lower customer acquisition costs.

Speaker 4: The sales marketing expenses decreased by 9.4% quarter over quarter, and it decreased by 3.3% year over year, which was mainly due to the improved efficiency of upgraded RTA customer acquisition model.

The sales and marketing expenses decreased by nine 4% quarter over quarter and decreased by three 3% a year over year.

This was mainly due to the improved efficiency of upgraded RGA customer acquisition models in.

Speaker 4: In Q3, new users with approved credit lines increased 15.1 percent and new active users increased 8.2 percent on a quarter-over-quarter basis.

In Q3.

Users with approved credit lines increased 15, 1% and new active users increased three 2% on a quarter over quarter basis.

Speaker 4: indicating a lower customer acquisition cost in Q3.

Indicating a lower customer acquisition cost in Q3.

Speaker 4: That profit for the quarter was approximately $371 million, marking steady increase with a 4.2% growth quarter over quarter and a 34.4% growth year over year.

Net profit for the quarter was approximately $371 million, marking steady increase with a four 2% growth quarter over quarter, and 34, 4% growth year over year.

Speaker 4: Our cash position is strong, ending the quarter with around $5 billion in hand and a solid equity position of $9.8 billion.

Our cash position is strong ending the quarter with around 5 billion in hand, and a solid equity position of $9 8 billion.

Yeah.

Speaker 4: In Q3, we have declared a recurring cash dividend plan and paid out the cash dividend for the first half of 2023, amounting around $19 million, equivalent to roughly 20% of the total net profit for the first half of 2023.

In Q3, we have declared a recurring cash dividend plan and paid out a cash dividend for the first half of 2023.

Multi around $19 million equivalent to roughly 20% of the total net profit for the first half of 2023.

Speaker 4: Looking forward, we will continue to look for ways to return more value to shareholders.

Looking forward, we will continue to look for ways to return more value to shareholders.

Looking ahead to the rest of 2023.

Speaker 4: Given the current macros and the pressure on asset quality throughout the industry, we remain conservative in loan origination pacing.

Given the current macros and the pressure on asset quality throughout the industry, we remain conservative in loan origination pacing.

We maintained the earlier guidance of annual <unk> amount of 245 to 255 billion.

Speaker 4: We maintain the earlier guidance of annual GNV amount of $245 to $255 billion.

Speaker 4: growth, which represents a 20 to 25% year-over-year.

Growth, which represents a 20% to 25% year over year.

Speaker 4: These estimates reflect our current expectations, which is subject to change.

These estimates reflect our current expectations, which is subject to change.

Speaker 4: To sum up, Q3 marks our sixth consecutive growth quarter. Our key strategies, risk management, customer enhancement, operational refinement, and the cost efficiency are all paying off.

To sum up Q3 marks our sixth considered consecutive growth quarter.

Our key strategies risks.

Risk management customer enhancement operational refinement and the cost efficiency are all paying off.

Speaker 4: As we navigate ongoing macro and industry challenges, we will maintain our focus on asset control, measure the business expansion, and operational optimization, poised to seize the opportunities as they arise.

As we navigate ongoing macro and industry challenges, we will maintain our focus on asset control measure the business expansion.

Operational optimization.

To seize opportunities the opportunities as they arise.

Speaker 4: Now, I will hand over to Jared Wu, our president, to discuss our approach on risk management in detail. Jared, please take it from here.

Now I will hand over to Jerry <unk>, our president to discuss our approach on risk management in detail Jared Please take it from here.

Sure James.

Speaker 3: I remember that our strategy of wind power upgrade and?? upgrade is continuing to be promoted. We continue to polish the wind power model, optimize the?? structure, and achieve this continuous effect. However, in the slow-growing environment of the macroeconomic recovery, we are also under some pressure due to the continuous impact of the anti-recovery of black market factors. We expect that the impact of these factors may last until the end of the 4th quarter.

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Speaker 5: Therefore, we adopted a more cautious and stable risk strategy to deal with environmental changes. At the same time, in the extraction phase, we expanded the scale of internal blow to play the return advantage of internal blow M1 to M3, improve the ratio of labor-to-manpower handling cases, and other measures to stabilize the efficiency of asset recovery.

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Speaker 2: Thank you James. In the third quarter we continued to step up our efforts in honing our holistic risk management system and optimizing our customer base on the grounds of our corporate strategy, risk management upgrading, and customer base upgrading, which yield consistent results. Although we continued to improve our risk management capability,

Thank you James.

In the third quarter, we continued to step up our efforts in honing, our holistic risk management system and optimizing our customer base on the ground, our cap rate strategy, which can management upgrading and the customer base upgrading.

Which yield consistent results.

We continued to improve our risk management capabilities, our loan collection rate experienced some fluctuations due to the slow recovery of macro conditions and the rise of illegal anti collections activities recently.

Speaker 2: Our loan collection rate experienced some fluctuations due to the slow recovery of macro conditions and the rise of illegal anti-collection activities recently.

Speaker 2: We anticipate this impact from these factors may last into Q4. Therefore, we are geared into a more prudent recommendment approach going forward.

We anticipate this impact from these factors may last into Q4.

Therefore, we will get into a more prudent risk management approach going forward.

Speaker 2: Meanwhile, we wrote out a series of countermeasures to mitigate this impact on loan collection. For instance, in the collection process, we have set up our internal collection workforce and leveraged the advantages of internal collection manpower. And we also increased the proportion of manual case handling to uphold the collection rate.

Meanwhile, we wrote out a series of countermeasures to mitigate these impacts on loan collection.

For instance in the collection process, we have stepped up our internal collection workforce and the leverage the advantages of internal collection manpower.

And we also increased the proportion of menu pace handily to uphold the collection rate.

Speaker 5: In the third quarter, we improved the RTA model and the new customer acquisition model by continuously optimizing RTA models and new customer acquisition models. The efficiency of our products has increased by 50%, and the risk of new customers has dropped by 20%. In Q4, we will increase the number of experiments and continue to advance the strategy of high-speed data generation. We will work hard to prepare enough high-quality customers in the coming year.

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Speaker 2: During the third quarter, through continuous optimization of our RTA model and the risk models for new customer credit line approvals, we achieved a 50-50% improvement in customer acquisition efficiency and a 20% reduction in new customer risk levels.

During the third quarter through continuous optimization of our RTA model and our risk models for new customer approvals, we are cheap.

Five zero percent improvement in customer acquisition efficiency, and 20% reduction in new customer risk levels.

Speaker 2: In Q4, we will gradually amplify our experimental flow and continue to rapidly advance strategies iteration, striving to accumulate a sufficient number of high-quality customers this year and lay the solid foundation for next year's growth.

In Q4, we will gradually amplify our experimental flow and continue to rapidly advance strategies iteration striving to accumulate a sufficient number of high quality customers. This year and the latest solid foundation for next year's growth.

Speaker 5: In the third quarter, we have accelerated the introduction of top branch control talents to enhance our core competitiveness. We can foresee that their professional ability and technical experience will help us make new breakthroughs in the field of branch control. We will also continue to uphold the principle of risk-driven driving to create a top-of-the-line branch control team.

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Speaker 2: In the third quarter, we accelerated the recruitment of top-notch industry talents in risk management space to further enhance our whole competitiveness.

In the third quarter, we accelerated the recruitment of top notch industry talent and risk management space further enhance our core competitiveness.

Speaker 2: We anticipate their professional skills and extensive experience in risk management space will assist us to achieve more breakthroughs. Adhering to the risk management-driven principle, we will continue to build up our industry-leading risk management team.

Anticipate their professional skills and extensive experience and risk management base will assist us to achieve more breakthroughs.

Hearing to their risk management, driven principle, we will continue to build up our industry, leading risk management team.

Speaker 5: In the face of the current situation, we will continue to take a cautious and stable risk strategy in the fourth quarter, and at the same time continue to improve our own control strength and continuously modernize our overall control strategy.

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Speaker 2: Looking ahead, in the face of the current macroeconomic situation in Q4, we will continue to adhere to the principle of risk management first, adopt a prudent strategy, and at the same time continue to enhance our underlying risk management capabilities and persistently iterate the overall level of our risk management.

Looking ahead in the face of the current macroeconomic situation in Q4.

We'll continue to adhere to the principle of risk management effort adopt a prudent strategy and at the same time continue to enhance our underlying risk management capabilities and persistently iterate the overall level of our risk management.

Speaker 2: Operator, let's close all our prepared management remarks. I think we are now good to open the floor for questions.

Operator that close all our propel the management remarks, I think we are now all go to open the floor for questions.

Speaker 1: Thank you. We will now begin the question and answer session. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Once again, that's star 11 for questions.

Thank you.

We will now begin the question and answer session. As a reminder to ask a question. Please press star one one on your telephone and wait for your name to be announced two ritual. Your question. Please press star one again, please standby, while we compile the Q&A roster once again that's star.

One one for questions.

Speaker 1: Our first question comes from the line of Alex Year from UBS. Please ask your question, Alex.

Our first question comes from the line of Alex Ye from UBS. Please ask your question Alex.

Yeah.

Speaker 5: Good morning, thank you for giving me this opportunity to ask questions. I have two questions here. The first one is about what Guan Yichen just mentioned in his speech. In the third quarter, there was a more effective control for users' pre-payment behavior. The pre-payment rate was significantly reduced and our take rate was also increased. Can you tell us about some specific measures and the outlook for the pre-payment rate of Q4?

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Speaker 5: The second question is about the number of new customers, which has made good progress in Q3, and the number of new customers has increased, and the cost of customers has also dropped. Can you briefly introduce us to the specific measures?

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Speaker 6: After two questions, the first one is regarding the management remarks about the control in early repayment ratio in Q3, which helped to increase the revenue rate. Could you share with some more color in terms of the specific measures taken and provide us with some color into your expectation for the Q4?

Two question first one is.

Regarding the Benjamin remarks.

This is a full control in early repayment ratio in Q3.

Which should help to.

Increase the revenue take rate could you share with some more color in terms of the specific measures taken and provide us with some color into the.

Our.

The expectation for Q4.

Speaker 6: And second question is about your new customer acquisition. We have noticed good progress in Q3 in terms of both lower customer acquisition costs and number of new customers acquired. So could you also give more color on this? Thank you.

And second question is about your new because of the acquisition we have noticed a good progress.

In Q3 in terms of both the customer because they have caused a number of new customers acquired so could you also give more color on this.

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Speaker 3: In fact, in Q3, we have set up a special team led by our company's leader, Chen Chi. We have established a more precise identification of our customers.

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Speaker 3: For example, which users may pay in advance for the entire model, including which users, according to the amount of users, to give a strategy for the best use of the user. Through various measures, we help find better users who may pay in advance. We also avoid some strategies that cause users to pay in advance.

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Speaker 3: In this case, we cooperated with different departments and effectively intervened with users in some processes, including when users were paying in advance.

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Speaker 3: In the process of paying back in advance, for example, if the user wants to pay back in advance, we can send a voucher to the user and tell him that if he does not pay in advance, we can give him a certain amount of money. These measures help us effectively control the whole process of paying back in advance.

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Speaker 3: In the whole project, we will follow up on this matter through state-by-state progress. So we got a good result. In Q3, our exchange rate was 90% of Q2.

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Speaker 3: This has greatly improved the level of our whole team. We expect that these measures will continue to be maintained in Q4.

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Speaker 7: Thank you, Alex. So, in the third quarter, we set up a special task force directed by the company's management level and then spending multiple departments, such as operations, to determine based on the customer's outstanding balance or as well as the credit line.

Thank you Alex.

First quarter was sort of a special PA directed by the company's management level, and then spanning multiple departments such as operations.

Determined based on the customers.

Outstanding balance for us or the credit lines.

Speaker 7: to better determine whether they are likely to do the repayment, or the repayment of the profit or not, to better avoid our strategic error to cost that.

Despite the best coupon strategy space on their performances to better determine whether we are likely to do the repayments or the recurring profit were not.

To better avoid our strategic error to cause that.

As well as we should be.

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Speaker 7: which effectively helps us to reduce the early recruitment rate.

Which effectively helped us to reduce the earnings credit rate.

Speaker 7: And also our task team held weekly meetings to review, adjust and re-optimize and achieve a very good result in the third quarter. In the third quarter, our earlier payment rate was only about 90% of which in the second quarter, which significantly improved the tick rate level of the revenue. And then we expect.

Also our top team health weekly meetings to review and discuss the re optimized and achieving very good results in the third quarter.

In the third quarter or early payment rate was.

90% of which in the second quarter, which significantly improve the take rate level of the revenue and then we expect to see.

Speaker 7: maintain such strategy as well as the optimized level in the early repayment rate to go on in the fourth quarter.

Maintain our strategy as well as the optimized level in the early repayment rates to go on in the fourth quarter.

Speaker 3: Okay, the second question is about SYNC. In fact, in Q3, our SYNC capability has been rapidly upgraded. We have made a major upgrade to the entire A-card risk model of SYNC. We have comprehensively enhanced the reliability of the entire SYNC model. We have also continued to promote the entire RTA model of some of our important media.

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Speaker 3: And we see that the new customer model and the current customer effect is a good foundation for us to acquire more high-quality customers next year and to improve the quality of our assets.

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Speaker 8: So, in third quarter, we continue to iterate our ability to acquire new customers and achieve the same reduction in the new customer risk.

Also in the third quarter, we continue to.

Our ability to acquire new customers and achievement.

Option and a new customer risks.

Speaker 7: In comparison with the previous quarter, we did a significant new customer use model upgrade, including incorporating more on the PBOC model usage as well as promoting the RDA model upgrade with our main media channel.

This quarter, we delivered.

A new customer with one of our brands, including operating while the POC model usage as well as promoting the RDA model upgrade with our.

With our media channels.

Oh, specifically.

Our customer acquisition efficiency will increase and increase.

Speaker 7: customer acquisition efficiency will increase by 50% and reduce new customers' risk by 20%. And from the pure earnings point of view, shareholder marketing expenses.

Perfect and reduced new customer risks by 20%.

And from a pure earnings point of view.

Speaker 7: increase by 9.4%, put her over a quarter, but he will be

Q3 financial fourth quarter.

Quarter over quarter, but newly registered users increased nine 1% quarter over quarter and new users with approved credit line.

Speaker 7: 9.0% quarter over quarter, and new users with approved credit log is increased by 15.1%.

One.

Speaker 7: and new active users will be increased by 8.2% on a quarter over quarter basis.

And new active users which increased by.

Eight 2% on a quarter over quarter basis.

Speaker 8: indicating a much lower customer acquisition cost in the third quarter.

To a much lower customer acquisition costs in the third quarter.

Speaker 8: Coming in the fourth quarter, we will increase the volume of our comparison as well as the experimental group mentioned before, and to continue to push forward the strategy of iteration at a more faster pace to better reserve a significant number of high-quality customers.

Coming in the fourth quarter, we will increase the volume of our comparison.

Sir Michael Glick mentioned before and to continue to push for the strategy of generation and more fastest faster pace.

A better reserve a significant number of high quality customers.

As well as including pushing the new model, which has been shown prominent results to better lay a foundation for the next year's growth.

Speaker 7: a new model which has been showing prominent results to better lay a foundation for the next year's work.

Hope that answers your questions Alex.

Thank you Alex.

Speaker 1: Our next question comes from the line of Yada Lee from CICC. Please ask your question, Yada.

Our next question comes from the line of Yeah, Tao Li from C. ICC. Please ask your question yet.

Speaker 5: Hello, Mr. Guan. Thank you for giving me the opportunity to ask this question. I would like to ask you about the current situation in October and November , what is the real loan demand, and what is the overall situation of the corresponding asset quality compared to the third quarter? Thank you, Mr. Guan.

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Speaker 9: I'll do the translation. Thanks, management, for taking my questions. And I was wondering if you could elaborate more about how the current loan demand looks like in October and November and compare with the previous quarter. Currently, it's always the recent trend of the asset quality. And that's all. Thank you.

I'll do the translation Thanks management for taking my questions and I was wondering if you could elaborate more about how the current low end demand looks like in October and November and compared with the previous quarter. Currently it's always the recent trend of asset quality and that's all thank you.

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Speaker 3: From the numbers we have seen so far, the demand in October and November is lower than in Q3.

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Speaker 3: However, the demand for Q3 is still a bit lower than October . It's about in the middle of the range. And if we look at the demand for Japan in November , this is one of the unique advantages. Because we have e-commerce and shopping malls, the demand for Q3 is still a bit lower than October . And if we look at the demand for Japan in November , this is one of the unique advantages.

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Speaker 3: So we benefited from the promotion of the Double 11 e-commerce shopping festival. We see that the demand has been brought back.

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Speaker 3: But considering some seasonal factors at the end of the year, we are still cautious about the amount of Q4.

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Speaker 3: In terms of quality of assets, Q4 still has a big impact on the quality of assets.

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Speaker 3: In addition to the impact of the black market, we can also see a decrease in efficiency. At present, there is a certain amount of pressure on our entire asset quality. Some risk indicators are fluctuating in the short term. But we have actively taken various measures to deal with some external impacts.

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Speaker 3: this fluctuation will have a huge impact on us. For example, we are now increasing the ratio of ethereum, and then we will use some strategies in advance to control the scale of new releases to improve the quality of assets. So I think we are trying to maintain Q4 at a reasonable level in terms of the overall scale and quality of assets.

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Speaker 7: Okay, thank you. At the operational level with the demand growth theme so far in October , November down slightly compared to the third quarter and no significant recovery of steam.

Okay. Thank you Ella.

At the operational level.

Demand growth in so far in October and November down slightly compared to the third quarter.

No significant recovery scheme.

Speaker 7: So, specifically, the demand level was slightly weaker in October compared to the third quarter, probably ranging in the single digits, and from the point of view that the average daily demand in November up to now, benefiting from the boost of the double 11 e-commerce special compared with the level of the third quarter is basically sluggish.

Specifically the demand level were slightly weaker in October compared to this quarter.

Ranging in the mid single digits and from our point of view that David.

David demand in November up to now benefiting from the double 11 E Commerce vessel.

Compared with the level.

Basically flattish.

Speaker 8: However, considering the year-end seasonality factors, including the bank's year-end supply tightening and the recent trend of overall capital flow shifting to government and real estate assets, we maintain a cautious and conservative stance on the fourth quarter volume.

However, considering the year end seasonality factors, including affect your supply tightening and the recent trend of overall capital flows shifting to government and real estate assets, we are maintaining a cautious and conservative.

On the fourth quarter with volume.

Speaker 8: And in terms of the asset quality, as Garrett mentioned earlier, in the post-quarter, the factors affecting our asset quality.

And in terms of the asset quality as Jarrett mentioned earlier in the fourth quarter factors affecting our asset quality participate.

Speaker 8: mainly because of the macroeconomy still in a period of steady recovery, as well as the growth, and the impact of the anti-collection industry has been affected the rate of our collection rates to a certain extent. And it seems that we are currently under pressure on the quality of assets, and the various risk indicators have been fluctuating. However, we have actively taken various countermeasures.

Mainly because of the macro economies do it appeared a steady recovery as well as the growth and the impact of the anti collection industry has been expected the rate of.

The rate of our collection rates to a certain extent.

And it seems that we are currently under pressure on the quality of assets and the various indicators have been frustrating.

However, we have actively taken various countermeasures.

Speaker 7: to deal with the fluctuations caused by external factors, such as increasing the proportion of our own inbound causes, and continuously iterating our risk management motto. And the volatility of risk will put some pressure on the growth of the first quarter, that's for sure, but we are doing measures to combat that.

To deal with the fluctuations caused by external factors such as increasing the proportion of our own inbound calls us and continuously iterating, our risk management motto and the volatility of risks will put some pressure on the growth for the fourth quarter. That's for sure, but we are doing measures to add to call.

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Speaker 3: I'd like to add one more thing. We've talked about the progress of our new course. It will be very helpful for our future.

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Speaker 3: In terms of scale, cost, and quality, Xingke has significantly improved. This is a very good factor in terms of scale, cost, and quality. We hope to see Xingke's improvement in terms of future quality and scale.

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Speaker 7: So, just to add one last point, in terms of the results that we're getting and the progress we're getting for new customer acquisitions, in the future, we're hoping with the promising size and the volume that comes out of new customers, as well as the cost being lowered for new customer acquisitions, as well as the risk level looking very promising and good right now. It should be a very good factor for us in the future. It should be helping, whether it's on our asset quality side or the operational side in the future. So, I hope that

So just to add one last point in terms of the results that we're getting of the product we're getting for new customer acquisition in the future we're hoping.

Promising signs in the mortgage that comes out of new customers as well as the costs being lower for new customer acquisition as well as the risk level looking very promising right now it should be a very good factors for us in the future it should be helping.

What happens on our asset quality side of the or the operational side in the future.

I hope that answers your question.

Speaker 10: Thank you, Yetta.

Thank you <unk>.

Speaker 1: Our next question comes from the line of Betsy Lee from CLSA, please go ahead Betsy.

Next question comes from the line of that T. Lee from C. L. S. A please go ahead Betsy.

Speaker 11: Thank you for giving me the opportunity to ask this question. I have two small questions to ask. First, we see that our annual loan guidance is maintained at a 20-25% increase.

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Speaker 11: I will translate by myself. The first one, given the current loan guidance, I think the company is in good track in maintaining the four-year loan origination. So I just wonder if you have any outlook for the 2024 loan demand. The second one is, I just wonder if the company has any further share.

I will translate by myself the first one.

We learned that having all of them.

I think the company.

It's a good time in maintaining the.

In the full year loan origination, but just wondering if you have any outlet scores that Tony Tony for alarm demand all of a sudden one and I just wonder if the company has any further share buybacks.

Thank you.

Okay.

Speaker 4: Okay, I will take the question. Basically, first question is related to the outlook. Second question is about the buyback, right? Basically,

Okay I will take the question.

First question is related to the outlook second question is about the buyback right.

Basically.

Speaker 4: For the macro perspective, we still believe there is a considerable amount of uncertainty in the fourth quarter. The overall recovery of the consumption still remains relatively slow.

For the macro perspective, we still believe there is a considerable amount of uncertainty uncertainty in the fourth quarter.

The overall recovery of the consumption is stability.

Remain very slow.

Speaker 4: So at the same time, because of the typical kind of seasonal factor of a funding supply in the fourth quarter, it's a little bit tight. So we expected the overall lending volume in Q4 to be broadly in line with Q3. OK, this is one. Two, obviously, we have other factors affecting the seasonal asset quality. These factors continue to exist, as mentioned earlier, right? One is the macro kind of a.

At the same time because of the typical kind of seasonal factor of our funding supply in the fourth quarter. It will be tight. So we expected the overall lending volume in Q4 to be broadly in line with Q3. Okay. This is one two obviously we have other factors affecting the seasonal asset quality. These factors.

Continue to exist as mentioned earlier right. One is the the macro or kind of a.

Speaker 4: The growth is a little bit slow, and also within the loan industry, the impact of the combating illicit financial activities related to the debt collection.

Maybe slow and also the within the loan industry the impact of the combating elicit financial activities related to the debt collection.

Speaker 4: This is still kind of affecting the rate of entry into the collection, and also the exit from the collection. So based on this, the overall asset quality is still under slight pressure at this point. The short-term risk indicators have still shown some fluctuations. So based on all of this, we have basically continued to maintain a prudent approach for Q4, really adhering to the principles of prioritization risks and prudent management.

This is still kind of affecting the rate of entry into the collection and also the exit from the collection. Okay. So based on this the overall asset quality is still under slight pressure at this point the short term risk indicators have still show some fluctuations so based on all of this we have basically maintained.

To maintain a prudent approach for Q4.

Really adhering to the principles of prioritization risks and prudent management.

And.

Speaker 4: Up to now, as a reminder, actually, you know, we have maintained a pretty good rate of growth. We have completed about 188 billion RMB so far for the first three quarters of this year. Really, this is about 26.7% year-over-year growth, okay? So we're going to continue, we're confident we'll continue to achieve the 245, 255 billion GAB growth. This will be 20 to 25%.

Up to now as a reminder, actually we have maintained a pretty good rate of growth. We have completed about 188 billion RMB. So far for the first three quarters of this year really this is about 26, 7% year over year growth. Okay. So we're going to continue.

Confident will continue to achieve the $245 to 155 billion.

The JV growth this will be will be 20% to 25%.

Speaker 4: And in terms of 2024, we're probably going to wait until after we close this year to give more guidance. By that time, hopefully, we have more certainty about the overall macros next year. OK, that's the first question. The second question in terms of any buyback plans, as a matter of fact.

And in terms of 2024.

We are going to wait until after we close this year to give more guidance at that time, hopefully we have more certainty about the overall macros next year.

That's the first question.

Second question in terms of any buyback plans as a matter of fact.

Speaker 4: The Board has approved two buyback plans last year. We completed about $50 million buyback earlier part of this year, and then the Board authorized

The board has approved to buyback plans last year.

We completed about $50 million buyback.

The earlier part of this year and then the board authorized.

Speaker 4: 20 million buyback in November last year. For that, we haven't done anything yet.

$90 million buyback in November last year for that we haven't done anything yet.

Speaker 4: But in last quarter, we have declared a dividend plan. Basically, we declared we're going to pay out from 15% to 30% of our net income as a dividend payout rate.

But.

Last quarter, we have declared a dividend plan basically we declare declared we're going to pay out from 15% to 30% of our net income as a dividend payout range. So the first half of this year, we paid out 20% of our net income and we have completed paying out to deliver.

Speaker 4: So the first half of this year, we paid out 20% of our debt income, and we have completed paying out the dividend in the last month or so. So we will continue to look for ways to return value to our shareholders. Basically, when we close the end of this year, we're going to come back to look at our dividend planning again, see whether we should continue to pay out for the second half of the dividend for the shareholder.

In the last last month also so we will continue to look for ways to return value to our shareholders basically when we close the end of this year, we're going to come back to look at our dividend planning again see whether we should continue to pay off for the second half of the dividend for this year. Okay. So basic.

Upholding the shareholder value is the number one priority for us.

Thank you hopefully that answer your question.

Thank you Betsy.

Speaker 1: We have reached the end of the question and answer session. I'll now turn the conference back to the company for any additional closing comments.

We have reached the end of the question and answer session I'll now turn the conference back to the company for any additional closing comments.

Speaker 2: Well, I think that close our conference call today. Thank you again, everyone, for joining us today. If you have further questions, please contact us via our contact information on the IR website. Thank you all. Have a good day and a good night. Thank you. OK, bye-bye.

Well.

I think that clouds, our conference call today. Thank you again, everyone for joining US today. If you have further questions. Please contact us by ally.

Congratulation on the IR website. Thank you all have a good day and good night. Thank you Okay Bye bye.

Thank you that concludes today's conference call. Thank you for participating you may now disconnect.

Speaker 1: Thank you. That concludes today's conference call. Thank you for participating. You may now disconnect.

Yeah.

Okay.

[music].

Okay.

[music].

[music].

Speaker 12: And.

Speaker 1: Good day and thank you for standing by. Welcome to Lessons in Tax Third Quarter 2023 Earnings Conference Call.

Good day and thank you for standing by welcome to listing syntax third quarter 2023 earnings conference call.

Speaker 1: At this time, all participants are in the listen-only mode.

At this time all participants are in a listen only mode.

Speaker 1: After the speaker's presentation, there will be question and answer session.

After the Speakers' presentation, there'll be question and answer session.

Speaker 1: To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised.

To ask the question. During this session you will need to press star one one on your telephone you wouldn't hear an automated message advising yohan is raised to withdraw your question. Please press star one again.

Speaker 1: To withdraw your question, please press star one one again.

Speaker 1: Please be advised today's conference is being recorded.

Please be advised that today's conference is being recorded.

Speaker 1: It is now my pleasure to hand you over to the IR Director, Ms. Mandy Doan. Please go ahead, ma'am.

It is now my pleasure to hand, you over to the IR Director Ms. Mandy Dong. Please go ahead ma'am.

Speaker 2: Thank you, Amber. Hello, everyone. Welcome to Le Xin's third quarter 2023 earnings conference call. Our results were issued earlier today and can be found on our IR website.

Thank you <unk> Hello, everyone welcome to the third quarter 2023 earnings Conference call. Our results were issued earlier today and can be found on our IR website.

Speaker 2: Joining me today are our CEO , Jay Xiao, President, Jared Wu, and CFO , James Zhang.

Joining me today, our C O J shell.

President Barrett rule and CFO. Thanks, Don.

Speaker 2: Before we get started, I'd like to remind you of our Safe Harbor Statement in our earliest press release, which also applies to this call. During the call, we may refer to business outlook and forward-looking statements, which are based on our current plans, estimates, and projections.

Before we get started I'd like to remind you of our safe Harbor statement in our earnings press release, which also applies to this call. During the call. We may refer to business outlook and forward looking statements.

Which are based on our current plans estimates and projections.

Speaker 2: The actual results may differ materially and we undertake no obligation to update any forward-looking statement.

Actual results may differ materially and we undertake no obligation to update any forward looking statements.

Speaker 2: Last, unless otherwise stated, all figures mentioned are in RMB.

Last unless otherwise stated all figures mentioned are in RMB.

Speaker 2: Jay will first provide an update on our overall performance. James will cover the financial results in more detail.

Jay will first provide an update on our overall performance.

<unk> will cover the financial results in more detail.

Speaker 2: And lastly, Jared will then discuss risk management.

And the lastly, Jerry well then discuss risk management.

Speaker 2: I will now turn the call over to Jay, his remarks will be in Chinese and the English translation will follow.

I will now turn the call over to Jay his remarks will be in Chinese and English translation will follow.

Speaker 3: Hello everyone, I am very happy to share with you the results of our third quarter of 2023.

Okay.

Thanks Alan.

Thank you.

Speaker 2: Hello, everyone. It's a pleasure to share with you our performance for the third quarter of 2023.

Hello, everyone is a pleasure to share with you our performance for the third quarter of 2023.

Speaker 3: to face the challenges of the current industry and macroeconomic environment. In the third quarter, we will take a cautious approach.

And the dose here.

Thank you Michelle.

Well then thank you.

Linda.

Speaker 3: Although there are some fluctuations in the risk management strategy, we have adopted the risk management strategy to balance growth and quality. In the third quarter, we will stick to the double-wheel drive of risk and data, promote detailed operations, and continue to enhance the ability to compare. We hope to see another steady growth in the industry.

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Speaker 2: In the face of the current industry-wide and macroeconomic challenges, we adopted a prudent and steady strategy in the third quarter. Despite a slight volatility in asset quality, we reasonably tightened our risk strategy to balance growth and quality.

In the face of the current industry wide and the macroeconomic challenges, we adopted a prudent and if that is strategy in the third quarter.

The slight volatility you know asset quality were reasonably tightened our risk strategy to balance growth and the quality.

Speaker 2: In the third quarter, we adhered to the dual-wheel drive of RISC and ZETA, pushed forward the refinements of operations, and continued to strengthen our fundamental capabilities, recording another solid ROSE performance.

In the third quarter, we adhered to the deal will drive of risk and data pushed forward the refinement of operation and the continued to strengthen our fundamental capabilities recording and novel solid relative performance.

Speaker 3: The exchange rate is 633 billion yuan, which is 13% higher than the growth rate. The management loan balance is 120.7 billion yuan, which is 28% higher than the growth rate.

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Speaker 3: 35.1 billion yuan, 30.4% growth, 3.7 billion yuan, 34.4% growth

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Speaker 2: Transaction volume was RMB $63.3 billion, up 13% year-over-year. Loan balance under management was RMB $120.7 billion, up 28% year-over-year. Revenue was RMB $3.5 billion, up 30.4% year-over-year.

That's on volume was RMB $63 3 billion.

13% year over year loan balance and management was RMB $120 7 billion up 28% year over year revenue was RMB three 5 billion.

34% year over year.

Speaker 2: Net profit was RMB 371 million, up 34.4% year-over-year.

Net profit was RMB $371 million up 34, 4% year over year.

Speaker 3: In the third quarter, the efficiency of new customers' acquisition and old customers' operation has been further improved. The co-operative effect of e-commerce and consumer modern business has been further enhanced. The financial services business continues to grow. The commercialization ability has been verified and is accelerating expansion.

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Speaker 2: In the third quarter, the effectiveness of both new customer acquisition and existing customer operation was further improved.

In the third quarter.

<unk> of both new customer acquisition and existing customer operation was further improved.

Speaker 2: The synergies between e-commerce and the consumer credit business were further enhanced and the tech empowerment business continued to grow, with its commercialization capability being validated, and we are accelerating its expansion.

The synergies between e-commerce, and the consumer credit business will further enhance and attack empower mats business continued to grow with these commercialization capability being validated and we are accelerating is expansion.

Speaker 3: There are three highlights of the performance of the third quarter. First, the upgrade of the new class acquisition and old class operation efficiency. In terms of the new class, the third quarter, the company has made major upgrades to the new class model and strategy, which has achieved a more significant effect. The information flow acquisition efficiency has increased by 38.5% compared to the previous quarter. The new class pass rate, the number of transactions used, the cost of the payment,

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Speaker 2: There were three main highlights of the third quarter results.

There were three men highlights of the third quarter results.

Speaker 2: Firstly, refined operations have led to improved efficiency in both acquiring new customers and managing existing ones.

Firstly refined operations have led to improved efficiency in both acquiring new customers and are managing existing one.

Speaker 2: In terms of new customers, we made a major upgrade on our new customer acquisition model and strategy in the third quarter, resulting in notable achievements.

In terms of new customers, we made a major upgrade of our new customer acquisition model and our strategy in the third quarter, resulting in notable achievements.

Speaker 2: The efficiency of attracting customers through feed channel increased by 38.5% compared to the first quarter. The approval rate, number of drawdown borrowers, and the facilitated loan volume for new customers all showed improvements of over 20% compared to the control group.

The efficiency of attracting customer there will cease channel increased by 38, 5% compared to the first quarter.

Proof of rate number of drawdown borrowers and facilitated the loan volume for new customers.

All showed improvement of over 20% compared to the control group.

Speaker 2: Additionally, early stage delinquency indicator decreased by nearly 20 percent.

Additionally, early stage delinquency indicator decreased by nearly 20%.

Speaker 2: We expect both the skill and quality of new customers to continue to benefit in the fourth quarter.

We expect both the scale and quality of new customers to continue to benefit in the fourth quarter.

Speaker 3: Thirdly, we have further enhanced the construction of offline customer capability, including upgrading the organization structure of the Puhui team, improving the sales management system, strengthening the standardization of talent cultivation, and strengthening offline accuracy recognition capability.

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Speaker 3: It further boosts the advantage of the offline direct customer model and promotes the decline in the overall customer cost of the company. In the third quarter, sales and costs fell by 9.4% compared to the second quarter. We see that there is still a lot of room and opportunity for growth in the future offline. We will continue to develop this unique operating model.

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Speaker 2: In the third quarter, we further enhanced our offline customer acquisition capability.

In the third quarter, we further enhanced our offline customer acquisition capabilities.

Speaker 2: This included upgrading the organizational structure of the offline inclusive finance, in Chinese, Puhuiqin. Improving the sales management system, strengthening the cultivation of standardized talents, and enhancing the ability to accurately identify offline customers.

This included upgrading the organizational structure of the offline inclusive finance in Chinese port team, improving the sales management system strengthening the calculation of standardized the talents and in housing the ability to accurately identify offline customers.

Speaker 2: These efforts solidified the advantages of our offline direct customer acquisition model, resulting in a decrease in overall customer acquisition costs.

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<unk> of our offline direct customer acquisition model, resulting in a decrease in overall customer acquisition cost.

Speaker 2: Sales expenses in the third quarter declined by 9.5% compared to the second quarter. We see more potential and opportunities for offline growth in the future, and we'll continue to deepen our presence in this unique business model.

<unk> expenses in the third quarter declined by nine 5% compared to the second quarter.

We see more potential and opportunities for offline growth in the future and we'll continue to deepen our presence in this unique business model.

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Speaker 3: system-as-a-core recognition system, improving the model framework for the entire life cycle from customer risk management. The model's scalability and stability have been improved by 10% to 20% from the previous version.

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Speaker 2: In terms of existing users, we maintained a steady operation and strengthened the underlying capability building for model application, further enhanced our service capability.

In terms of existing users, we maintained a steady operation and strengthened the underlying capability building for model application.

Further enhance our service capabilities.

Speaker 2: During the quarter, we introduced more data sources and built an identification system centered around the credit system of PBOC.

During the quarter, we introduced more data sources and acute and identification system.

Around the credit system of PB Oc.

Speaker 2: We improved the model framework for the entire customer acquisition, risk management, and operational life cycle.

We improve the model framework for the entire customer acquisition risk management and operational lifecycle.

Speaker 2: The sequencing and the stability of the model were improved by 10% to 20% over the previous version.

The sequencing and the stability of the model were improved by 10% to 20% over the previous version.

Speaker 3: In the third quarter, we use corporate WeChat to operate users. We have now accumulated 700,000 fans, improving service efficiency and satisfaction. Through corporate WeChat, we optimize the operation of high-quality customers. In the traditional mode, customer orders increased by 65%, and transactions increased by 107%.

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Speaker 2: In the third quarter, we utilized the enterprise WeChat for user operations, which has accumulated 700,000 borrowers, and improved service efficiency and satisfaction.

In the third quarter, we utilized the enterprise wechat for user operation, which has accumulated several hundred thousand borrowers and the improved service efficiency and the satisfaction.

Speaker 2: Through refined operations, target high-quality customer groups via enterprise WeChat. Compared to the traditional method, we achieved a nearly 65% increase in customer order rates and a 107% increase in transaction volume.

Through a refined operations target high quality customer groups by our enterprise Wechat.

<unk> to the traditional method, we achieved a nearly 65% increase in customer order rates and the 100, Oh, 7% increase in transaction volume.

Speaker 3: The company's 18% discount on Leginka, a product for high-quality customers, has made good progress.

Thank you.

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Speaker 3: After using Lejin Card, users' orders and transaction fees have significantly increased. The order rate, per capita transaction fee, and total transaction fee are more than 80% higher.

It's important to continue to season.

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Speaker 3: It has effectively improved the activity of high-quality generation customers and promoted the return of more high-quality lost users, broadening the scope and space of our high-quality user experience.

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Speaker 2: In the third quarter, our product, Lejin Card, priced below 18.18% and targeted towards high-quality customer segments, delivered satisfying progress.

In the third quarter, our product under the <unk> cut priced below 18, one 8% and the targeted towards high quality customer segments.

Levered satisfying progress.

Speaker 2: After using Le Jincard, users' willingness to place orders and the transaction volume has been significantly improved. The order rate, average transaction volume per person, and the total transaction volume all experienced around an 80% increase.

After using the card users willingness to place other than the transaction volume has been significantly improved the <unk>.

Other rate average transaction volume per person and the total transaction volume all experienced around and 88 zero percent increase.

Speaker 2: This effectively enhanced the engagement of high-quality active borrowers and facilitated the return of more high-quality settled users, expanding the scope and the opportunities for managing our premium user base.

This effectively in house, the engagement of high quality active borrowers and facilitate the return of more high quality set of users expanding the scope and the opportunity for managing our premium user base.

Speaker 3: The second highlight is that the ecological business continues to grow, and the co-operative effect is further enhanced. The first is the tree business. After achieving record profits in the fourth quarter of last year, the tree business scale has further increased. 59% of the three-quarter return has increased. After two years of exploration, the tree business has completed the upgrade of the solution, and the product verification is more diversified. The standard ability of system and delivery is verified, and the ability to get more commercial and commercial banks is improved.

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Speaker 2: The second highlight was the continued growth of Lexin ecosystem and the further enhancement of synergy.

The second highlight with the continued growth of the washing ecosystem and the further you health net of synergies firstly.

Speaker 2: Firstly, the tech empowerment business. After achieving quarterly profit in the fourth quarter of last year, the scale of this business line grew further, with a 59 sequential increase in the third quarter.

Firstly, the test empowerment business.

After achieving quarterly profit in the fourth quarter of last year. The scale of this business line grew further with <unk>.

<unk> nice sequential increase.

In the third quarter.

Speaker 2: After nearly two years of exploration, we have completed upgrades in solutions, diversified our product portfolio, and validated the standardized capabilities in systems and deliverables, which was well recognized by multiple urban and rural commercial banks.

After nearly two years of exploration, we have completed upgrades in solution diversified our product portfolio and the validated the standardized our capabilities in systems and the deliverables.

Well recognized by multiple urban and rural commercial banks.

Speaker 3: The 59% speed further confirmed that the business ability of the vet is improving

Revenues were secured essential team begins.

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Speaker 3: The number of customers is not much in the overall business of Lexin. But the industry supervision continues to deteriorate. Consumers are now under the influence of the downward trend of market interest rates. The number of customers business can help banks to quickly sell new generation digital transformation. The market potential is huge. It can also bring better coordination to the cooperation of new generation funds. Promote Lexin to better cooperate with other institutions and have more in-depth cooperation. At present, the number of customers business is accelerating expansion. Lexin will cover more of the industry.

Thanks, gentlemen.

Shellfish and the Susan Levy shocking bobbing and John <unk> <unk>.

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Speaker 2: The 59 growth rate further validated the commercialization capability of our tech empowerment business.

The <unk> growth rate further validated the commercialization capability of our tech empowerment business.

Speaker 2: although it currently accounts for a small proportion of Luoxin's overall business.

It currently accounts for a small proportion of licensed over all of our business.

Speaker 2: In the context of increasingly refined industry regulations and the downward trend in consumer credit market interest rate and tech empowerment business can help banks quickly undergo retail credit digitalization transformation with tremendous market potential.

In the context of increasingly refined industry regulations, and the downward trend in consumer credit market interest rate and Tad empowerment business.

Banks quickly undergo retail credit digitalization transformation with tremendous market potential.

Speaker 2: It can also bring better synergy to funding cooperation and drive deeper and broader collaboration between Lexin and financial institutions.

Can also bring better synergy so funding cooperation and to drive deeper and broader collaborations between the vaccine and the financial institution.

Speaker 2: Currently, the Tech Empowerment Business Team is accelerating its expansion and will cover more city and rural commercial banks to further expand the scale.

Currently the Tad empower men business team is accelerating is expansion and we'll cover more CET and the rural commercial banks to further expand the scale.

Speaker 3: Second, the value of e-commerce business in the field of new customers and active old customers has been highlighted, and the co-efficient effect of new generation business has been further enhanced. Third, the taste of e-commerce mobile phones continues to consolidate.

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Speaker 3: Apple, T1 and Huawei L1's highest-level authorization. It maintains an advantage in the first batch of rare goods, further enriching the user consumption of the stock market. Take Huawei as an example. The third quarter, the new Mate 60, all-in-one and X5 sales hit a new high all year round, up about 60% from last year's Mate 50 sales.

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Speaker 2: Secondly, our e-commerce business brought out more value in terms of customer new acquisition and activating existing ones, further enhancing the synergies with our core consumer credit business.

Secondly, our ecommerce business brought out more value in terms of ASP.

Customer new acquisition and activating existing wants further in housing the synergies with our core consumer credit business in the third quarter. Our ecommerce division continued to solidify its highest level authorization for F O T one and Huawei <unk>.

Speaker 2: In the third quarter, our e-commerce division continued to solidify its highest-level authorization for Apple T1 and Huawei L1.

Speaker 2: Maintaining advantages in skills and initial supply.

Maintaining advantages in skills and the initial supply.

Speaker 2: This further boosted consumer spending on our e-commerce platform.

This further boosted consumer spending on our e-commerce platform.

Speaker 2: Taking Huawei as an example, sales of the new Mate 60 series and the X5 reached a record high for the year in the third quarter with an approximately 60% increase in revenue compared to last year's Mate 50 product.

Taking Huawei as an example sales of the new make 60 series and the X five reached a record high for the year in the third quarter with approximately 66 zero percent increase in revenue compared to last year's made 50 product.

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Speaker 2: In addition to our strengths in the consumer electronics 3C category, we introduced more high-quality new brands and merchants onto our platform in the third quarter, covering categories that are favored by young generation, such as luxury goods, sports, and pet goods. The number of new merchants reached 241, representing a sequential growth of 51% in brand coverage.

In addition to our strength in the consumer electronics category.

<unk> introduced more high quality, new brands and the merchants onto our platform in the third quarter covering categories that are favored by young generation, such as luxury goods spot and packet.

The number of new merchants reached 241, representing a sequential growth of 51% in brand coverage.

Speaker 3: With the entry of more merchants and the expansion of the product range, a large number of users are excited, bringing mutual benefits for e-commerce and consumer credit business. During the Double 11, the e-commerce consumer population has grown significantly, and the number of transactions of e-commerce high-quality users has risen significantly, about 12.4%. At the same time, active customers of e-commerce credit have further boosted e-commerce consumption, forming a cycle-enhancing business ecosystem.

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Speaker 2: With the addition of more merchants and expansion of product categories, a large number of existing users have been activated, leading to a simulation between e-commerce and the consumer credit business. During the Double 11 Shopping Festival, the period from November 1st to 11th, the growth in the e-commerce consumer base resulted in a notable increase in transaction volume from high-quality active customers.

With the addition of more merchants and expansion of product categories. A large number of existing users have been activated leading to us stimulation between e-commerce and consumer credit business.

During the double 11 shopping festival the period from November one to.

The 11th the growth in the E Commerce consumer base resulted in a notable increase in transaction volume around high quality active customer.

Speaker 2: level R1 to R3 with a sequential increase of approximately 12.4%. At the same time, these active consumer credit user further drove e-commerce spending, creating a reinforcing cycle within our business ecosystem.

Several or want to operate with a sequential increase of approximately 12, 4% at the same time.

<unk> active consumer credit user further drove e-commerce spending.

<unk>, a reinforcing cycle within our business ecosystem.

Speaker 3: The third highlight is data-driven quality improvement, and further enhancement of profitability. In the third quarter, we adopted a series of data-driven methods to improve operating efficiency. These measures include improving the precision operation of data-driven tools such as application user life cycle global models. Through decision-making models, the system has improved the balance of capital assets as well as improved user return on investment. In addition, we continue to promote the improvement of quality and jointly promote the total cost of Q3 by 7%.

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Speaker 3: We will try our best for increasing the number of exchanges. We will upgrade the Rainbow Note unicorn to three. Join us.

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Speaker 2: The third highlight is the data-driven approach to improve quality and efficiency, further enhancing our profitability.

The third highlight is the data driven approach to improve quality and the efficiency further in housing our profitability.

Speaker 2: In the third quarter, we implemented a series of data-driven measures to improve our operational efficiency.

In the third quarter, we implemented a series of data driven measures to improve our operational efficiency.

Speaker 2: These measures included applying data tools such as user lifecycle models to strengthen precision operations, enhancing the efficiency of funds and asset matching through decision simulation systems, and improving the customer retention rate for settled users.

These measures included applying data tour, such as user lifecycle models to strengthen procedure operation in housing the efficiency offence and acid matching <unk> simulation systems, and improving our customer retention rate for Saratoga users.

Speaker 3: The drop in funding costs further improves the company's capabilities. In the third quarter, the company achieved major optimization of the funding structure and strategic cooperation with multiple major shareholders. Funding costs have been re-created and the group ratio has fallen by 21%.

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Speaker 2: The drop in funding cost has further improved profitability. In the third quarter, the company achieved significant optimization of our funding structure and entered into strategic partnership with multiple major banks, including national-wide joint stock banks. Funding costs reached a new record low, a 21-fifth drop on a Q-on-Q basis.

The drop in funding costs has further improved profitability in the third quarter. The company achieved significant optimization of our funding structure and entered into a strategic partnership with multiple major banks, including national wide joint stock banks funding costs.

A new record low.

'twenty, one BP drop Q on Q basis.

Speaker 3: The rapid development of business is inseparable from the continuous investment in technology and research. In the third quarter, the company invested 1.27 billion yuan in research and development, and continued to lead the industry. In the quarter, we have made a significant investment in the industry through Lexin Finance.

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Speaker 3: data, training, and business data, we have accelerated the landing of AI models in the company. Business interoperability has been fully landed in the main business processes, such as e-commerce, customer service, and retail. In terms of productivity improvement, we have widely applied it in the field of development code support, design and creative production, data analysis, and so on, to improve the overall operating efficiency of the company. In terms of the core of the CCP, we continue to pay attention and actively explore the risks of AI models.

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Speaker 3: core areas, which greatly improves the overall operating efficiency and customer satisfaction of the company.

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Speaker 2: The rapid development of our business also relies on continuous investment in technology and the research and development. In the third quarter, our company invested RMB 127 million in research and development, maintaining our industry-leading position.

The rapid development of our business also relies on continuous investment in technology and research and development in the third quarter, our company invested RMB $127 million in research and development maintaining our industry.

<unk> position there.

Speaker 2: During the quarter, we accelerated the development of the use case of AI large language models in our business through exclusive data pre-training and fine-tuning of business data. In terms of business applications, we have already fully implemented the AI model in key business processes such as telemarketing, customer service, and loan collection.

During the quarter, we accelerated the development update use case of AI large language models in our business.

Exclusive data for training and the fine tuning of business data.

In terms of business application, we have already fully implemented the AI model in key business process.

Telling marketing customer service and the loan collection.

Speaker 2: In terms of working tools, the AI model is widely applied in scenarios such as coding assistant tools, generating design ideas, and data analysis, enhancing the overall operational efficiency of the company.

In terms of working toward the AI model, it's widely applied in scenarios, such as coding assistant tours generating design ideas and data analysis in housing the overall operational efficiency of the company.

Speaker 2: In terms of risk management, we are closely watching the industry trend and actively exploring the use case of AI large language models. These initiatives have significantly improved the overall operational efficiency and the customer experience.

In terms of risk management, we are closely watching the industry trend and actively exploring the use case of AI large language models.

These initiatives have significantly improve the overall operational efficiency and the customer experience.

Speaker 3: With solid technical advantages, China's service industry has been selected 500 times in the third quarter. China is the only company in the financial technology industry to be selected four times.

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Speaker 2: With solid technology advantages, in the third quarter, Lexin has been selected for the fourth time as one of the top 500 Chinese service companies, making us the only FinTech company on the list for the fourth time.

Solid technology other than they did in the third quarter.

Looking ahead being selected for the four times as one of the top 500 Chinese service companies, making us the only Fintech company on the list four four times.

Speaker 3: In terms of corporate social responsibility, in the third quarter, we will make a new upgrade to the consumer rights protection measure. In the 5S protection system, we will improve data security management, improve anti-fraud protection capabilities, enhance smart customer service applications, and strengthen the financial and black market crackdown. These four measures will build a comprehensive security firewall for consumers.

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Speaker 2: In terms of corporate social responsibility, in the third quarter we made major upgrades to our consumer rights protection measures.

In terms of corporate corporate social responsibility in the third quarter, we made a major upgrade to our consumer rights protection measures.

Speaker 2: Upon the foundation of our 5S Guardian system, we have carried out four major initiatives.

The foundation of our fight as Guardian system, we have carried out four major initiatives.

Speaker 2: One, strengthening our data security management system. Two, enhancing anti-fraud protection capability.

One strengthening our data security and management system to in housing anti fraud protection capabilities right.

Speaker 2: 3. Expanding intelligent customer service applications, and 4. Intensifying efforts to combat illegal anti-collection groups.

Great expanding intelligent customer service application and for intensifying efforts to combat illegal anti collection groups.

Speaker 2: These measures collectively established a comprehensive safety firewall for consumers.

These measures collectively established a comprehensive safety fire war for consumers.

Speaker 3: In August this year, Lexin intercepted 1.6 billion data security attacks, data protection and governance systems, maintaining a record of zero data leaks since the launch, and the anti-fraud system accumulated a total of more than 4.7 billion yuan in ground user losses.

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Speaker 3: School who, to my into senses in the jorganial, I has to do.

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Speaker 3: In the face of complex and uncertain external environments, we will stick to the sacred business principle of risk management.

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Speaker 3: We will continue to push for the reduction of risk and increase the quality of assets. We will maintain a balance between the size of the transaction and the quality of assets. The company will maintain the annual transfer of RMB2,450 billion to RMB2,550 billion, with a growth rate of 20% to 25%.

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Speaker 2: From January to August this year, Lexin intercepted 160 million instances of data security attacks, maintaining a record of zero data leaks since the launch of the data protection and governance system.

From January to August this year.

In intercept at 160 million instances of data security attacks, maintaining a record of zero data lakes since the launch of the data protection and the governance system. The Antifraud system has prevented potential user logic for over 200 and <unk>.

Speaker 2: The anti-fraud system has prevented potential user losses for over 470 million RMB. And the customer satisfaction has reached 99.6%.

17 million RMB and the customer satisfaction has reached 99, 6%.

Speaker 2: Looking ahead to the fourth quarter, in the face of a complex and uncertain external environment, we will adhere to the principle of prudent operation and prioritize risk management. We will continue to enhance risk management capabilities and improve asset quality while striking a fine balance between transaction volume and asset quality.

Looking ahead to the fourth quarter in the face of a complex and uncertain external environment, we will adhere to the principle of prudent operation and prioritize risk management.

I'll continue to in house risk management capabilities, and improved asset quality, while striking a fine balance between transaction volume and asset quality.

Speaker 2: We maintain the guidance on full-year loan origination we gave earlier this year, ranging from RMB $245 billion to $255 billion, representing a 20 to 25 percent year-over-year growth.

We maintained the guidance on full year loan origination we gave earlier this year.

When James Brown, RMB 245 billion to 255 billion, representing 20% to 25% year over year growth.

Speaker 2: ???,???????????CFO,?? Next, I will pass to our CFO for financial update.

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Next I will pass to our CFO.

For financial update.

Speaker 4: Thank you, Jay. I will now provide more details on our financial results. Please note that all numbers are in RMB unless otherwise stated.

Thank you Jay I will now provide more details on our financial results. Please note that all numbers are in RMB unless otherwise stated.

Speaker 4: In the face of a sluggish macroeconomic environment and a subdued consumer confidence, we have sustained our growth for the sixth straight quarter, signaling a robust V-shaped recovery since the first quarter of 2022.

In the face of a sluggish macro economic environment and a subdued consumer confidence we have sustained our growth for the sixth straight quarter signaling a robust V shaped recovery since the first quarter of 2022.

Speaker 4: Our focus on improving risk management capability, customer upgrading, operational refinement, cost of initiatives, and optimizing our funding, particularly by lowering the early repayment rate, has prepared us for.

Our focus on improving risk management capabilities customer upgrading operational refinement coffee initiatives and optimizing our funding, particularly by lowering the early repayment rate.

Has propelled us forward this quarter.

Speaker 4: Amidst the ongoing economic uncertainties, our strategy has been prudent.

Amidst the ongoing economic uncertainties, our strategy has been prudent.

Speaker 4: we have moderated new loan originations to prioritize asset quality and conservatively made ample provisions in our financials, which, while impacting us in the near term, support us our long-term financial health.

We have moderated new loan originations to prioritize asset quality and conservative we've made ample provisions financials, which was impacting us in the near term support us our long term financial health.

To provide some context first let's take a look at the year over year number comparisons.

Speaker 4: To provide some context, first let's take a look at the year-over-year number of comparisons.

Speaker 4: Total loan origination increased by 12.7% year-over-year to $63.3 billion.

Total loan origination increased by 12, 7% year over year to $63 3 billion.

Speaker 4: Revenue climbed to $3.5 billion, up 30.4% year-over-year, largely due to reduced early repayments and larger outstanding loan balance, now at $121 billion.

Revenue climbed to $3 5 billion up 34% year over year, largely due to reduced early repayments and the larger outstanding loan balance now at 171 billion.

Speaker 4: Notably, we significantly cut the early repayment ratio in Q3 to a level at about 90% of Q2's level and aim to keep it optimal in Q4.

Notably we significantly cut the early repayment ratio in Q3 to a level at about 90% of Q2's level and aim to keep it optimal in Q4.

The average weighted APR remained under 24% with low below this threshold comprising 86% of total loans.

Over 5% from last year.

Speaker 4: Our funding costs hit a record low of 6.4%, down from 7.0% last year, attributable in part to successful partnerships with the national banks, which we anticipate will further reduce costs.

Our funding costs hit a record low of six 4% down from 7.0% last year.

Attributable in part to successful partnerships with the National banks, which we anticipate will further reduce costs.

Speaker 4: Loan tenders decreased as we fine-tuned our portfolio's structure in response to market uncertainty, averaging 13.1 months compared to 13.8 in Q3 of 2022.

Low tenders decreased as we fine tuned our portfolio structure in response to market uncertainty, averaging 13, one months compared to 38.

In Q3 of 2022.

Speaker 4: Cost efficiencies continue with operating expenses, including processing and services, sales and marketing, R&D, and G&A.

Cost efficiencies continue with operating expenses, including the processing and services sales and marketing R&D and G&A.

Speaker 4: Falling to 0.91% of the average loan balance, a 35 basis point.

Falling 2.91% of the average loan balance.

A 35 basis points saving from the previous year.

Consequently, net income rose to 371 million, a 34, 4% increase year over year.

Improving our net margin to 10, 6%.

Despite the heightened provisions the increase underscores our resilient profitability and the business momentum.

Apart from the above year over year analysis, I would also like to share some perspectives from quarter over quarter comparisons.

Total <unk> remained relatively stable as we balanced maintaining asset quality with business growth.

A slight take rate improvement reflects effective early repayment control and reduced funding costs, although offset by pricing reductions shorter.

Durations and additional provisioning.

Risk management remains a cornerstone strategy, yet factors like the slow economic recovery and challenges within the loan collection industry have slightly affected the asset quality as reflected in metrics such as day one delinquency.

Right.

One collection rate and 90 days delinquency rate.

For instance, our 90 days delinquency rate in Q3 was $2 six 7%, which is slightly higher.

In comparison with 259% in Q2.

Nonetheless, we have adjusted our bad debt provisions, reaching a coverage ratio of approximately 350%.

Which is defined as the total provision amount divided by the principal amount of 90 90 days delinquent loans.

The current fluctuation in asset quality across industry seems to continue to cloud Q4.

We are vigilant and have taken measures to safeguard our asset quality level.

Operating expenses fell by seven 2% from the last quarter, primarily from reduced sales and marketing and general administrative spending.

With the increased provisions from Q2, we still achieved a four 2% sequential growth in net income and maintained a 10.6% net margin.

From both year over year and quarter over quarter perspective, we have made significant improvements during Q3.

Although macro headwinds persist we have maintained the rebounding pace of our business and anticipate the business growth momentum to continue.

Let's review some specific financial items.

Total operating revenue hit $3 5 billion for Q3, with an increase of 14, 8% quarter over quarter and 34% year over year.

Driven mainly by the credit facilitation business, which saw a significant increase both quarterly and annually.

Picking polymer services also grew.

While installment E Commerce platform service revenue declined due to the high Q2 numbers driven by the six one <unk> promotion.

And an accounting reclassification despite.

Despite of all of all this the E Commerce team GMB grew by 12, 8% year over year.

Expense ratio demonstrates our continued progress in cost optimization, notably in marketing.

We have achieved greater efficiency and lower customer acquisition costs.

The sales and marketing expenses decreased by nine 4% quarter over quarter and decreased by three 3% a year over year, which was mainly due to the improved efficiency of upgraded RTA customer acquisition models in.

In Q3.

Users with approved credit lines increased 15, 1% and new active users increased three 2% on a quarter over quarter basis.

Indicating and lower customer acquisition costs in Q3.

Net profit for the quarter was approximately $371 million, marking steady increase with a four 2% growth quarter over quarter, and 34, 4% growth year over year.

Our cash position is strong ending the quarter with around 5 billion in hand, and a solid equity position of $9 8 billion.

Yeah.

In Q3, we have declared a recurring cash dividend plan and paid out a cash dividend for the first half of 2023.

Multi around $19 million equivalent to roughly 20% of the total net profit for the first half of 2023.

Looking forward, we will continue to look for ways to return more value to shareholders.

Yeah.

Looking ahead to the rest of 2023.

Given the current macros and the pressure on asset quality throughout the industry, we remain conservative in loan origination pacing.

We maintained the earlier guidance of annual GMB amount of 245 to 255 billion.

Growth, which represents a 22% to 5% year over year.

These estimates reflect our current expectations, which is subject to change.

To sum up Q3 marks our sixth.

Consecutive growth quarter.

Our key strategies risk.

Risk management customer enhancement operational refinement and the cost efficiency are all paying off.

As we navigate ongoing macro and industry challenges, we will maintain our focus on asset control measure the business expansion.

Operational optimization.

To seize opportunities the opportunities as they arise.

Now I'll hand over to Jerry <unk>, our president to discuss our approach on risk management in detail Jared Please take it from here.

So this is James.

This is a woman.

<unk> Thunder, that's just you're taking on more of a margin <unk> Cushing Jiggle featured showed US a chart.

I'm wondering do you worry for which our appointment of Aqua and Jean Jacques.

Dollar factory, so it's unusual associating shops.

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<unk> agenda.

You may begin.

So Andrea Womens Tongo, Colorado, Administrated anyway, more probably neutral.

<unk>.

Regarding <unk>, so some things are solid.

Thank you James.

The third quarter, we continued to step up our efforts in honing, our holistic risk management system and optimizing our customer base on the ground, our corporate strategy, which can management upgrading and the customer base upgrading which yield consistent results.

Although we continued to improve our risk management capabilities, our loan collection rates experienced some fluctuations due to the slow recovery of macro conditions and the rise of illegal anti collections activities recently.

We anticipate this impact from these factors may last into Q4.

Therefore, we will get into a more prudent risk management approach going forward.

While we wrote out a series of countermeasures to mitigate these impacts on loan collection volumes.

For instance in the collection process, we have stepped up our internal collection workforce and the leverage the advantages of internal collection manpower.

And we also increased the proportion of menu pace handily to uphold the collection rate.

Do women to goods is Joachim was encouraging because those in terms of margin.

So it is all about Jewish she can cause a bunch of chocolate brands awesome. Thank you assortment on some jobs.

She calls with agents.

Is that an insurer pay hall changzhou the user cohort.

Yes.

<unk>.

During the third quarter through continuous optimization of our RTA model and the risk models. When you cut them are quite in line approval, we achieved a 55 zero percent improvement in customer acquisition efficiency and 20% reduction in.

New customer risk levels.

In Q4, we will gradually amplify our experimental flow and continue to rapidly advance strategies iteration striving to accumulate a sufficient number of high quality customers. This year and the latest solid foundation for next year's growth.

Thank you Dr <unk>.

Cindy you different sometimes we'll end up working through them.

Jim and Brian and Lisa.

Once again, John bunch, a woman's that's not going to be issued in the tool box women, who are distributing some functions you talked again about often.

Difficult lending.

In the third quarter, we accelerated the recruitment of top notch industry talent and risk management space further enhance our core competitiveness.

We anticipate their professional skills and extensive experience and risk management base will assist us to achieve more breakthroughs.

Adhering to their risk management, driven principle, we will continue to build up our industry, leading risk management team.

Introduction of homegrown she misses as you do a women's on tissue has fujitsu with Jennifer.

In terms of its citizens isn't there from commercially with <unk> hundred 1000 people for Jose.

Looking ahead in the face of the current macroeconomic situation.

In Q4, we will continue to adhere to the principle of risk management first adopt a prudent strategy and at the same time continue to enhance our underlying risk management capabilities and persistently into rate the overall level of our risk management.

Yes.

Operator that close all our propelled the management remarks, I think we are now all go to open the floor for questions.

Thank you we will now begin the question and answer session.

<unk> you ask a question. Please press star one one on your telephone and wait for your name to be announced to ritual. Your question. Please press star one again, please standby, while we compile the Q&A roster once again Thats star one one for questions.

Our first question comes from the line of Alex Ye from UBS. Please ask your question Alex.

Yeah.

Particularly.

What's it going to take us.

Hum.

Going to the Jarden Tito.

Got it.

At one point she once you've done that.

Some of them come to.

John mentioned that jumped out at the moment.

Okay, Great and then Goldman Sachs. Judy you said, it's mostly Q.

So that's a good example of newspapers.

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Should I go for the genes that can be seen.

Both of those food on Pico Holdings.

Gotcha.

Joe mentioned I'll, just take the two together.

Two question the first one is.

Regarding the Benjamin remarks.

About this is the <unk>.

Full control in early repayment ratio in Q3.

Which would help to Ah.

We increased our revenue per rig could you share with some more color in terms of the specific measures taken and provides us with some color into the.

The expectation for Q4.

And second question is about your new acquisition, we have noticed a good progress in.

In Q3 in terms of both the customer because they are of course, a number of new customers acquired so could you also give more color on that.

And so the ones you want over the seafood.

So as I close I will go through a woman's open good quality and good judgment women's anytime you've got Telemundo.

Google's indulgence within an ultra woman who Tor.

Cohort in that interim.

The Asia Serbia.

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Now here, you'll recall that in the U S.

Okay.

Hey, Jonathan logo churn.

So I'm gonna have you guys heard it.

So with regard to what goodwill towards silver both a woman can call. That's all about Asia critically T cell phones on the Yieldco.

In Asia Women's unions.

So youll put T cell phone today.

Thanks, Tony.

Hello woman.

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Alcohol women's yoga their T cells were one quarter ago women.

So if you don't want to quote Haynesville well.

Okay.

Thank you.

<unk> by the way we are doing.

And when you put it in one quarter.

Woman cake and eating it into the television.

It was about a woman, although youll start to consider either lithium Hong Kong tunnel.

So a woman sorry, it's good that you've got somebody told them locally.

So the it's always into the attention to the suite. So it's not true that our portfolio as you guys know when we get closer we'll know if you want me to.

Cool.

Joe.

So on top of that he is on a woman.

But you got you got restriction well sorry Joseph.

His forces, though toilet tissue the bolsa.

Okay. So it doesn't go to one another.

Yes.

<unk>.

You got to Sheila.

Thank you Alex.

In the first quarter was set up a special path directed by the Companys management level, and then spanning multiple departments such as operations.

Determined based on the customers.

Outstanding balance or isos are credit lines.

Despite that coupon strategy space on their performances to better determine whether we are likely to see the repayments or the residual profit or not.

To better avoid our strategic error to cause that.

We as well as we should be.

Suitable.

In order to deter them from doing so.

Which effectively helped us to reduce the earnings credit rate.

And also are tasking health weekly meetings to review adjusted re optimized and achieving very good results in the third quarter and the third quarter, our new payment rate was only about 90% of which in the second quarter, which significantly improve the take rate level of the revenue and then we expect to maintain our strategy.

As well as the optimized level in the early repayment rates to go on in the fourth quarter.

I'll go into here.

So she can go from here just as that goes.

Well listen colony.

So that's a good you've got data in July.

Yeah.

<unk> got a you got air cover photo motion that you guys hold on it.

Women.

Dodge from Chilean Tuscola linked <unk> Sabo Goldman tier tissue that does take a little bit.

It's only I'll leave you with a good Asia, Canada together, you've got motion.

The hole dielectric <unk>.

<unk> sorry.

Some of the other theater, you Hauler woman <unk> Sullivan Luisa.

Catherine the shinko to Felicia I sat down with them to us. So it's something that kind of a woman of social video and besides Alabama plant.

<unk> seen this year.

Consolidated within Djellaba mutual so about it.

So even with a woman consultative Fortinet I Couldnt do it yourself the cohort.

Total well being.

Also the unions have hindered.

In tier two issue that we don't have that you said.

Women, Colorado, the shinko, there's a lot of emotion.

So we will have them in year two.

Sure.

The cohort two centers.

How did you go through the holiday.

Also in the third quarter, we continue to iterate, our ability to acquire new customers and achievement.

<unk> is a new cohort of risks.

This quarter, we did a significant new customer wins from other offerings, including operating while the POC model usage as well as promoting the RDA model upgrade with our own.

With our major channel.

Oh, specifically.

Our customer acquisition efficiency will increase.

Perfect and reduced new customer risks by 20%.

And from a pure earnings point of view.

Thanks Keith.

Key financial fourth quarter.

Quarter over quarter, but newly registered users increased nine 1% quarter over quarter and new users with approved credit line.

One.

And new active users will increase by.

Eight 2% on a quarter over quarter basis.

To a much lower customer acquisition costs in the third quarter.

Coming in the fourth quarter, we will increase the volume of our comparison.

Sir Michael Glick mentioned before and to continue to push for the strategy of generation at a more faster.

Thank you.

Better reserve, a significant number of high quality customers.

As well as including pushing the new model, which has been shown prominent results to better lay a foundation for the next year's growth.

Hope that answers your questions Alex.

Thank you Alex.

Our next question comes from the line of Yeah, Tao Li from C. ICC. Please ask your question yet.

Hello, Glenn So I'll Hawkins it with you.

And then what's the next Johnson and Johnson <unk> Johnson.

The two studios that once you switch from Hong Kong.

So thank you to officers from you on that you're going to Richardson.

Tom.

I'll do the translation Thanks management for taking my questions and I was wondering if you could elaborate more about how the current low end demand looks like so work in November and compared with the previous quarter currently small ways.

You can try and of the asset quality and that's all thank you.

For the political will hear what up another.

Two women with Colorado.

So you can kind of deliver tool and club.

Tusa I do female.

You may all come down.

How critical the Chooser.

Close enough.

So yes, the two southern Utah <unk>.

So I'll start.

Although the Duncan so that go with it so well.

Women's wholesale.

In the future.

The version two you also the women you may want to European Telcos consumption. So I'm also so you. So you can go with you.

You go to shop for a woman Colo.

Oh, there you go through so I love what average.

Thank you Hilton and good safety.

<unk> content is.

So we gotta come October one subscription than Colorado near more digitally than usual, so almost or you can also listen gotta Eagle.

California is about so you got you.

Do you guys see incentive hydro.

The totals.

It's also a sense sort of where do you think you'll sort of Deutsche M. In short order so it closer to.

And so down the road.

Yeah.

In the Netherlands.

So about call bulk water.

That's always true.

Yeah, and then come down so it's always hard to say what can I tell you we'll look at <unk>.

So it's done to the eastern portions of the values of model does a woman in tissue types without going to enforce.

With Asia.

Yes.

So the total day and women at Grainger.

All of the C&I side.

Sandy therefore tend to fluctuate.

Upon closing of our public way more <unk> and so that first of all was it a woman.

You got to pay more to sense with us So women Doug what are your volatility closer which is how you got anything you can say goodbye.

Okay. Thank you Ella.

At the operational level.

On growth so far in October and November down slightly compared to the third quarter.

No significant recovery scheme.

Specifically in the demand level were slightly weaker in October compared to this quarter.

Probably ranging in the mid single digits and from our point of view that as of.

David demand in November up to now benefiting from that.

The 11 e-commerce vessel compared with the level.

Basically flattish.

However, considering the year end seasonality factors, including affect your supply tightening and the recent trend of overall capital flows shifting to government and real estate assets, we are maintaining a cautious and conservative stance on the fourth quarter with volume.

And in terms of the asset quality as Jarrett mentioned earlier in the fourth quarter the factors affecting our asset quality participate.

Mainly because of the macro economies do it appeared a steady recovery as well as the growth and the impact of the anti collection industry.

Its been expected the rate of.

The rate of our collection rates to a certain extent.

And it seems that we are currently under pressure on the quality of assets and the various indicators have been frustrating.

However, we have actively taken various countermeasures.

To deal with the fluctuations caused by external factors such as increasing the proportion of our own inbound calls us and continuously iterating, our risk management motto and the volatility of risks will put some pressure on the growth for the fourth quarter. That's for sure, but we are doing measures to add to call.

Baghdad.

Hope that answers your question yet.

Or does the portal together.

Hum attendants, Hello element of the encoder that limousine done so well.

Women doesn't go.

Another you've got both of them focusing kohl's rewards. So they'll come in do you want me to like I said, so I'll go to the woman.

So to answer the other one going from here.

Please a holiday.

Hugo useful so don't want me to answer that.

So I think other guys I'm, saying wait I to answer that.

A woman to Oklahoma City.

<unk>.

So just to add one last point in terms of the results that we're getting of the province, we're getting for new customer acquisition in the future.

We're hoping.

Promising site and evolving that comes out of new customers as well as the costs being lower for new customer acquisition as well as the risk level is looking very promising right now it should be a very good factors for us in the future it should be helping.

What happens on our asset quality side of the or the operational side in the future.

I hope that answered your question yet.

Thank you <unk>.

Next question comes from the line of that T. Lee from C. L. S. A please go ahead Betsy.

Oh. Thanks, that's all you can do it is to you.

One of the people that you have a.

Atlanta, and Dallas Southeast Asia.

And then Ive one guy that cancellation that you go Kashi I should address your question I guess I'm gonna shaping now holds.

Hum.

And then they'll go down long Utah.

She told me he was just like ours.

And then that you would see in the home.

Hello, Thiago shoot content when you buy a meal you go with that.

Got you.

I'll translate by myself the first one.

And then Doug Holland, although I think the company.

It's a good time in maintaining the.

In this weekend long origination, but just wondering if you have any outlet scores that Tony Tony for alarm demand all of a sudden one and I just wonder if the company has any further share buybacks.

Thank you.

Okay.

Okay I will take the question.

First question is related to the outlook second question is about the buyback right.

Basically.

For the macro perspective, we still believe there is a considerable amount of uncertainty uncertainty the fourth quarter.

The overall recovery of the consumption stability remain very slow.

At the same time because of the typical kind of seasonal factor of our funding supply in the fourth quarter. It will be tight. So we expect that the overall lending volume in Q4 to be broadly in line with Q3. Okay. This is one two obviously we have other factors affecting the seasonal asset quality. These vectors.

Continue to exist as mentioned earlier right when is the the macro or kind of a.

Libbey slow and also the within the loan industry the impact of the combating elicit the financial activities related to the debt collection.

This is still kind of affecting the rate of entry into the collection and also the exit from the collection. Okay. So based on this the overall asset quality is still under slight pressure at this point the short term risk indicators have still show some fluctuations so based on all of this we have basically maintained.

To maintain a prudent approach for Q4.

Really adhering to the principles of prioritization risks and prudent management.

And.

Up to now as a reminder, actually we have maintained a pretty good rate of growth. We have completed about 188 billion RMB. So far for the first three quarters of this year really this is about 26, 7% year over year growth. Okay. So we're going to continue.

We will continue to achieve the $245 255 billion.

The JV growth this will be will be 20% to 25%.

And in terms of 2024.

We are going to wait until after we close this year to give more guidance at that time, hopefully we have more certainty about the overall macro next year.

That's the first question.

Question in terms of any buyback class as a matter of fact.

The board has approved to buyback plans last year.

We completed about $50 million buyback.

The earlier part of this year and then the board authorized.

<unk> million buyback in November last year for that we haven't done anything yet.

But.

Last quarter, we have declared a.

Dividend plan basically we declare declared we're going to pay out from 15% to 30% of our net income as a dividend payout range. So the first half of this year, we paid out 20% of our net income and we have completed paying out as dividend dividend in the last month or so.

So we will continue to look for ways to return value to our shareholders basically when we close at the end of this year, we're going to come back to look at our dividend planning again see whether we should continue to pay off for the second half of the dividend for this year.

Okay. So basically upholding the shareholder value is the number one priority for us.

Thank you hopefully that answer your question.

Thank you Betsy.

We have reached the end of the question and answer session I'll now turn the conference back to the company for any additional closing comments.

Well I think that cloud our conference call today. Thank you again, everyone for joining US today. If you have further questions. Please contact us via our IR app.

Congratulation on the IR website. Thank you all have a good day and good night. Thank you Okay Bye bye.

Thank you that concludes today's conference call. Thank you for participating you may now disconnect.