Q4 2023 Qifu Technology Inc Earnings Call
Your 'twenty two 'twenty three earnings conference call.
At this time, all participants are in listen only mode.
After the speaker's presentation, there will be question and answer session.
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Please also note that todays event is being recorded at this time I'd like to turn the conference call over to MS. Karen G Senior director of capital markets. Please go ahead Karen.
Thank you Anthony Hello, everyone in the World come to Chi fluid technologies fourth quarter 2023 earnings conference call.
Our earnings release was distributed earlier today and is available on our IR website.
Joining me today are mid to high <unk>.
And our CEO, Mr. Alex <unk>, our CFO and Mr Jin Yan with Yahoo.
Before we start I would like to refer you to our safe Harbor statement in the earnings press release, which also applies to this call.
During the call, we won't be making forward looking statements, which are predictions projections or other statements about future events.
Statements are based on current expectations and assumptions that are subject to risks and uncertainties that could cause actual results to differ materially.
For more information please refer to the risk factors discussed in our most recent form 20-F filed with SEC.
Also this call includes discussions of certain non-GAAP financial measures.
Please refer to our earnings release, which contains a reconciliation of the non-GAAP financial measures to GAAP financial measures.
Also please note that unless otherwise stated all figures mentioned in this call are in RMB terms.
Today's prepared remarks from our CEO will be delivered in English using and AI generated voice now I will turn the call over to Mr. <unk>. Please go ahead.
Okay.
Hello, everyone and thank you for joining us today.
During the quarter.
Optimizing our top and bottom line performance starting to bear fruit capping off a solid 'twenty to 'twenty three for us.
We empowered more financial institutions total loan facilitation and origination volume on our platform reached RMB 119 billion up 13, 8% year over year.
With the ongoing business optimization.
Our revenue increased 15, 1% year over year to approximately RMB, four 5 billion hitting a nine quarter high.
non-GAAP net income increased 25, 1% year over year to roughly RMB 115 billion, representing the fastest growth seen over the past nine quarters.
From an annual perspective total loan facilitation and origination volume on our platform increased 15, 4% year over year to a record RMB 475 8 billion non.
non-GAAP net income increased approximately 6% from last year to roughly RMB 445 billion.
In 2023, we promptly adjusted our strategies to navigate market challenges, which allowed us to not only meet the growth targets set at the beginning of the year, but also achieve a notable improvement in profitability during the second half of the year. This robust performance underscores our operational resilience and sepsis.
Solid foundation for our high quality development in 2024.
Consumer credit industry entered the post pandemic era in 2023.
China and navigated a bumpy journey towards economic recovery consumers within the high quality segment, we're becoming increasingly cautious about borrowing.
Maintaining asleep certain user segments started to face pressures on repayments I mean elevated youth unemployment rates the deceleration in the overall consumer credit markets momentum also led to a decline in the marginal efficiency of incremental growth after thorough consideration by management, we have set quality.
The growth and profitability as our primary objectives and shifted our operational strategy to prioritize efficiency over scale by refining every aspect of our operations. We aim to enhance the long term healthiness and sustainability of our business in.
In 2023, we achieved substantial progress in terms of quality growth and profitability speaking of quality growth, we extended our market reach to target customers by further diversifying user acquisition channels.
In July we began working with a leading short form video platform as their only fintech partner through our embedded finance model.
By leveraging our strong user profiling and risk identification capabilities, we quickly ramped up our user base and consistently maintained our leading market share on the platform.
Additionally, we have actively pursued and engaged in similar collaborations with industry, leading platforms across other verticals such as e-commerce payments and mobile phone App stores in 2023, the percentage of new users with improved credit lines through the embedded finance channel rose to 31%.
With 82% increase in loan facilitation and origination volume through.
With the ongoing refinement of our profit model.
The weight of our embedded finance business in Q4 increased by roughly 20% from the same period last year. The collaborative nature of this business model allows us to complement the platforms and capitalize on the rapid expansion to quickly achieve scalable profitability.
We are optimistic about maintaining another strong growth performance in embedded finance. This year in 2023, we saw a notable improvement in our overall acquisition efficiency.
While the number of total new users with improved credit lines increased 7% compared to 2022, our sales and marketing expenses decreased 12% leading to an impressive 18% year over year decline in acquisition cost per credit line user.
In 2023, we improved our profitability meaningfully while sustaining solid growth.
Thanks to a stronger funding position greater asset allocation efficiency, and our enhance products and services.
On the funding front, we further optimized our funding structure and reduced our annual funding costs by more than one percentage point year over year. In 2023, we issued RMB 12, 5 billion ABS is representing a year over year increase of 56%.
Benefiting from the robust demand from stay tuned and joint stock banks as well as major securities firms are ABS issuance costs decreased 75 basis points. Additionally, we have secured the first ever AAA International rating for exchange traded ABS as this will help us attract more funding from rich.
People overseas institutions, allowing us to further boost issuance volume and optimize issuance costs in terms of asset allocation.
With the accuracy of user profiling and identification continuously improving we on boarded a more diversified spectrum of financial institution partners strengthening our ability to serve various loan asset segments.
By aligning assets based on the risk appetites of different institutions.
We optimized our asset allocation and increased overall returns on our loan portfolio.
In 2023, our loan facilitation and origination volume under the IC model steadily increased the enhanced precision in asset allocation increased the underwriting efficiency from our financial institution partners.
<unk> and a notable improvement in our take rate.
In Q4, our revenue take rate as a percentage of loan volume for IC improved by 54% from the same period last year.
On the product front.
We launched a loyalty program catering to various user needs and improving the engagement of our existing users.
Offering a wide range of value added services, we improved our user retention.
Going forward, we will continue to enrich our product offerings and implement differentiated strategies to create value for users ultimately boosting our users LTV.
Risk management is the cornerstone of our business in the second half of the year, we encountered notable volatility in our asset quality due to the broader macro headwinds.
The strict align controls by China's telecom carriers in Q4 added further pressure to our overall risk profile and risk.
Sponsor these challenges starting in Q3, we have gradually tightened our credit standards and deteriorated risk strategies across the loan facilitation credit operation and post credit process to improve our risk metrics.
First we further enhanced our credit approval system.
Which allowed us to extend the greater proportion of credit lines to high quality users.
We revamped our strategic framework for existing borrowers and introduced external data sources, such as Baidu Tencent.
<unk> and <unk> for joint modeling and scoring thereby enhancing our ability to identify and intercept high risk customer segments.
Third we fine tuned our collection strategies and incentive schemes to increase our collection efficiency.
With these measures in place we began to see a steady improvement in risk metrics for new loans in November and onwards, and a gradual recovery in risk performance for overall loan portfolio starting in January and February of this year.
Historical loan assets gradually mature and new loans make up a higher percentage of our portfolio. We expect our overall risk performance to further improve this year.
<unk> technology solutions business continued to make solid progress in 2023.
We further optimized our product offerings and entered into partnerships with a number of financial institutions covering different categories.
Including joint stock Internet private and municipal bonds.
We tailored our deployment models to cater to their specific needs and remain committed to providing them with end to end technology solutions.
We expect more clients will be ready to deploy our solutions on a broader scale throughout this year.
In 2023, we strategically allocated more resources to artificial intelligence and large language models and took the initiative and exploring applications of large language models in the financial sector.
Our financial large language model outperforms, all the open source financial large language models with comparable parameters and knowledge proficiency. According to open source benchmarks within our intelligent marketing a total of 600 images and 100 videos are generated by our GC per day based on performance testing over the past five months.
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AIG see generated image placements have shown the potential to reduce unit acquisition costs by roughly 9% taking.
Taking a longer term view utilizing AIG see generated images, along with automated placements will enable us to make quick updates and optimize placement strategies significantly boosting marketing efficiency.
We have also used our large language model to empower the telemarketing team facilitating communication with approximately 13 million users to date.
By providing lead refinement semantic analysis and suggested talking points the drawdown of our credit line usage increased by roughly 5%.
We are proud of what we have achieved in 2023.
Looking ahead to 2024.
As the macro uncertainties persist, we will continue to take a prudent approach in our execution.
Our focus will be on pursuing quality growth by optimizing risk performance and operational efficiency to improve overall profitability.
Meanwhile, we will consistently make strategic investments in long term growth opportunities.
This will involve broadening our strategic partnerships across various sectors to further the success of our embedded finance collaboration model and pursuing collaborative user management with our financial partners.
Moreover, we will explore in more open platform model.
Leveraging our extensive industry knowhow and user insights to enable more effective connections between users and financial institutions.
Through our technology solutions business, we aim to facilitate the digital transformation of more financial institutions and.
The word we're widening the top of our funnel, while keeping a watchful eye on its bottom in 2023, our return on equity on a non-GAAP basis reached approximately 22% outperforming most financial and Internet companies, we've returned substantial value to our shareholders by distributing USD 100 <unk>.
<unk> million dollars in cash dividends for 2023.
And repurchasing USD $132 million worth of shares since we launched the buyback program in June 2023, the aggregate amount accounted for 50% of our net income for the year, representing a significant boost in our shareholder returns.
In 2024, we remain committed to further optimizing our capital allocation after careful consideration from our board we will maintain our current dividend policy for 2024.
Additionally, starting in April 2024, we will implement a new share repurchase program. We are convinced that our company shares are significantly undervalued and the current market valuation does not reflect the company's intrinsic value.
We are confident about our future prospects and therefore have decided to substantially step up our share repurchase efforts.
Later, our CFO will go through the planning detail with that I will now turn the call over to Alex <unk>.
Thank you hi, good morning, and good evening, everyone welcome to our fourth quarter earnings call.
While the first quarter was a fairly challenging period for our operation as macroeconomic recovery progress is slower than we hoped.
And the consumer sentiment remained muted we still delivered another solid quarter of financial performance during.
During the quarter, we took proactive actions to fine tune, our product and service offerings strengthen relationship with users and key partners.
Optimized business mix and trimmed exposure to underperforming assets.
Total net revenue for Q4 was $4 5 billion versus $4 3 billion in Q3, and $3 9 billion a year ago.
Revenue from credit driven service type of heavy was $3 2 billion in Q4 compared to $3 1 billion in Q3 and $2 neighborhood in a year ago, but year on year growth was mainly due to longer effective duration growth and on balance sheet loans and the contribution from other value added services, partially offset.
Decline in off balance sheet loans.
Sequential increase reflects the growth in on balance sheet loans and contribution from other value added services.
On balance sheet loan count for over 20% of the total loan volume in Q4.
Overall funding costs further declined by roughly 20 bps sequentially and over 100 bps year on year with the help of a strong relationship with financial institution partners and record breaking ABS issuance.
Revenue from power service capital Light was $1 2 billion in Q4 compared to $1 2 billion in Q3, and the $1 1 billion a year ago.
Year on year growth was mainly due to strong contribution from ICD and other value added services.
Substantially offsetting the decline in capitalized loan facilitation.
Q4 capped bride loan facilitation IC and other tech solution combined account for roughly 57% of total loan volume.
Compared to roughly 56% in the prior quarter. We expect this ratio to be gradually trending up through 2024, as we try to strike an optimal mix.
The churn risk bearing and non risk bearing assets in a non certain macro environments.
Q4, we saw continued sequential improvement in revenue take rate for both kept heavy aircraft five business.
Mainly driven by better asset mix.
During the quarter average IRR of the loans, we originated and facilitated the was 21, 3% compared to 21 seven in the prior quarter.
We purposely trailed our direct exposure to high price high risk assets in response to the macro uncertainty.
Looking forward, we expect pricing to be fluctuate in the narrow band around this level for the coming quarters.
Sales and marketing expense increased 4% Q on Q, and a 33% year on year.
Please know that year on year comp is somewhat misleading at sales marketing I would take activities or severely depressed by the sudden outbreak of Covid cases in Q4 up 2022.
We added approximately $1 7 million real credit on users in Q4, roughly flat Q on Q.
Unit cost acquiring new credit line user also increased modestly Q on Q to 326 from 306, mainly due to the seasonality.
For full year 2023 units TASC was approximately 304 compared to 369 in 2022.
We will continue to adjust the pace of our new user acquisition based on the micro condition from time to time. Meanwhile, essentially as Joe mentioned, we have made notable progress in diversifying our user acquisition channels during the quarter.
Overall, we expect to see modest lower customer acquisition costs in 2024 was improving efficiency and control. The pace. Furthermore, we will continue to focus on reenergizing existing user base.
Repeat borrowers historically contribute vast majority of our business.
In Q4, we continue to experience volatility in asset quality as T, leading risk metrics worsened sequentially. They weren't delinquency was five 9% in Q4 versus four six in Q3.
The uptick in day, one delinquency, mainly reflect continued negative sentiment amount of borrowers Ajay as they face more economic uncertainties.
Certainly the collection rate was 84, 9% in Q4 versus 86, 7% in Q3. In addition to macro condition certainly the collection rate was also was further impacted by an unexpected line control by telecom carriers since November that result in industry wide lower collection.
Lower connection rates of outbound phone lines for collection operations, although we have to take actions to find alternatives and we believe that such line control issues can be resolved eventually the impact to our Q4, our risk metrics still quite visible.
We have further optimize our risk management model and apply even more restrictive standard on new applications to mitigate potential risks throughout the quarter. We also proactively adjust our business next to further reduce our exposure to high risk assets.
By January whereas already start to see stable credit quality of overall portfolio as new loans quality improved and old long gradually mature.
Although economic conditions remain challenging and we may continue to see some fluctuation of these metrics in the near future. We believe overall risk performance of the loan portfolio will be relatively stable in 2024 compared to the full year performance of 2023.
As macro uncertainties persist and credit quality fluctuate, we will continue to take a prudent approach to book provisions against the potential credit loss totaled.
Total new provision for risk bearer loans in Q4 were approximately two point no bidding and the write backs our previous provisions were approximately 341 million.
On a sequential basis, new provision booking ratio increased while the write backs declining as expected risk of the assets moved higher.
Provision coverage ratio, which is defined as total outstanding provision divided by total outstanding delinquent asset have any loans balance between 90, and 180 days or 481% in Q4 compared to 534% in Q3. The provision coverage ratio was still near the high end of our.
Oracle range.
non-GAAP net profit was 1.15 billion in Q4 compared to 1.1 label in Q3.
For full year 2023, non-GAAP net profit was $4 45 billion compared to 4.21 billion in 2022.
Effective tax rate for 2023 was 18, 5% compared to articulate ETR of approximately 15%.
The higher ETR was mainly due to additional withholding tax provision related to cash distributions from onshore to offshore for dividend payment and share repurchase.
With solid operating results and higher higher contribution from capitalized model, our leverage ratio, which defined at risk bearing lungs balance divided by shareholders equity was $3 three X in Q4 at historical low we expect to see leverage ratio fluctuated around this level in the near future.
We generate approximately $2 4 billion cash from operation in Q4 compared to $1 2 billion in Q suite.
The record breaking operating cash flow was in part due to the change in working capital related to the long national holiday at the beginning of the quarter.
Total cash and cash equivalents were $7 8 billion in Q4 compared to $8 2 billion in Q3 non restricted cash was approximately $4 2 billion in Q4 compared to $4 9 billion in Q3, the sequential decline in cash position was mainly due to increased cash usage in our own balance sheet lending.
As we continue to generate healthy cash flow from operations. We believe our current cash position is sufficient to support our business development and to return to our shareholders.
With our current dividend policy, our board has approved a dividend of U S. Dollar 29 cents.
Per class, a ordinary share or U S. Dollar 58 cents per ads for the second half of 2023 to holders of record of class a ordinary share and.
As of the close of the business on April 15, 2020 for Hong Kong time in New York Con respectively. The aggregate amount of dividend distributions for physical year 2023 will be approximately in the U S dollar of $117 million.
On June 20th 2023, we announced a share repurchase plan to repurchase up to $115 million over a 12 months period.
As of March 12, 2024, we have already bought approximately $132 million worth of our Adcs in open market and the average price around $15 seven U S dollar.
We expect to fully execute the current share repurchase plan around the end of March roughly three months ahead of initial schedule.
To further enhance returns to our shareholders. Our board has approved a new share repurchase plan to repurchase up to 350 million worth of our Ats over a 12 months period, starting April 1st 2024.
By our estimate the above mentioned two share repurchase plan combined.
Repurchase nearly 20% of the Companys total outstanding share upon poorly execution at the current share price.
The share repurchase plan further demonstrated management confidence and commitment to the future of the company and the management intent to consistently use share repurchase plans to a chip additional EPS accretion in the long run.
Meanwhile, our board also reaffirmed our current dividend policy, a problem, which will continue to distribute 20% to 30% of our GAAP net income attached dividends to shareholders on a semiannual basis.
With a fully execution of a new share repurchase program and the dividend plan.
Buying the payout ratio could well exceed 70% in 2024 and the combined yield based on current market cap will be over 70%.
An extremely attractive investment by any measure.
Now regarding our business outlook.
As macroeconomic uncertainty reduce a visibility into long term trend, we want to maintain a prudent approach to strike a balance between loan volume growth and the profitability.
We have purposely trimmed our exposure to underperforming assets and improve overall ROA levels with a change of asset mix and the quality of the growth. The company does not view the growth in overall loan volume as appropriate indicator to reflect underlying drivers for its operating results. Therefore, the company will no longer.
Provide loan volume guidance in its earnings release for the foreseeable future.
Meanwhile, under the current market condition. The company will continue to focus on enhancing profitability and the efficiency of its operation. We believe that in all look of near term profitability combined with detailed discussion of other key efficiency metrics and earnings conference call would be more appropriate.
To reflect management's operational priority and execution efforts.
And finally numbers for the first quarter of 2024, the company expects to generate non-GAAP net income.
In RMB 1.15 billion and RMB, one 2 billion, representing a year on year growth between 17 and 22%.
This outlook reflects the company's current and preliminary view, which is subject to material changes.
I would like to conclude our prepared remarks, operator, we can now take some questions.
Thank you.
We will now begin the question and answer session to ask a question. Please press star one one on your telephone and light.
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Once again that style one one for questions.
Our first question comes from the line of Richard <unk> from Morgan Stanley. Please ask your question Richard.
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Given the macro uncertainty XD H, we will continue to maintain prudent approach in our accretion equity in first half of 2024 gas.
As for the overall loan volume growth is not our primary goal.
That's our primary goal will be the quality of our growth and our quality of earnings.
Based on the strategy I think are to some extent will impact our overall loan volume growth.
As we change our exposure to the lower margin or profit.
Last night to assay, which we are actually making a positive impact on our profitability.
In terms of internal and external data we are looking at so far we have seen positive trends in the macro data such as.
Actually I have interest in copper and copper alley and chill.
Sheila import and export data also increased by eight 7%.
And our own matrix is also trending battery, which makes us more comfortable about the future trends.
As for quarterly patterning, Q1, usually slack season for our business.
We made a lot of assets optimizing our risk.
We expect our loan volume for Q1, we'll be at the lowest level.
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Regarding the asset quality, we make more proactive adjustments to improve asset kind of painting, a Q4 into Q1.
Our credit standards for new loans, and the catching back longer duration loans.
Okay.
Based on our observation.
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The increase in rates of our new loans originated in the summer.
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I think 10% compared to Q3 and the time. He said he didn't think they write off the new loans for early January further improved by 10% from that from the contract.
In addition longer duration loans accounted for 18 picking up on new loans in second half last year, while the contribution has been reduced to less than 10%. So far in 2024 hours at least short term duration, but the macro cycle.
Okay.
So far we have seen improvement.
Our overall loan portfolio.
In February and expect to see further improvement.
Yes, we cannot proceed gradually gradually mature.
Yeah.
Okay.
The provision booking.
As you know historically, we have been the only pretty prudently.
Prudent approach towards the provision as the Chunghwa mentioned, we are expecting the risks a mattress will gradually improve throughout this year, but still would probably will take the similar kind of a booking ratio.
Two a book our provision just to the to be conservative at the same time. Please note that our.
Overall, the capital having long as a percentage of a total as well as the absolute volume for this year will most likely be lower than last year as.
As we mentioned were shifting towards more pep lifestyle.
Segment.
So the base for those provision are getting lower for this year, which means the absolute provision amongst our will most likely dropped versus last year, but the booking ratio will most likely be that still the same on the conservative side.
Thank you Richard.
Okay.
Thank you for your question Richard.
Our next question comes from the line of Alex Ye from UBS. Please ask your question Alex.
If you want to do it.
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Kind of like what do you mean in Pasadena.
Would it be a matter of degree.
So at least you can do one or two ways.
Yeah, the way to deliver against them and you go on your decision on when to engineer. We showed you. It's one of the two don't kick all of them and that's a good.
Issue.
And then the last one on women.
When you kind of Liza 100, you should be good.
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When you were thinking there.
Yeah.
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Of course, you don't get to what would be your mission.
Josh on the incremental money away she had the window in Shanghai.
The woman Lumi.
And maybe to get a sense of the hydro treating and cooking.
Okay I'll do the translation.
Regarding the drivers for our profitability improvement.
I think last Tuesday, we have made substantial efforts to improve our overall profitability.
<unk> positive impact in our our last Q3 and Q4.
We expanded China will continue.
24.
We believe our content will increase as we continue to work on our rig something at that allocation and product.
Number one on the rig.
We were cut back and lower quality or lower efficiency assets trading.
All eight of our overall loan portfolio.
Second our funding side last year, we have seen.
The potential decline in our funding costs.
Given there's still ample market liquidity, just yet we will continue to push more ATM issuance and is it just all the funding cut to Fedex.
Yeah, I'll answer allocation, well collaborate with more financial institution.
It should not change their risk appetite appropriate at that time.
It should be at that allocation efficiency and our profitability at the Wow.
Fourth on the product side, we will further enhance and differentiation.
Differentiate our product offering to increase user stickiness and yeah, I'm kind of LTV.
We will increase our operational efficiency.
Larger language and a lot of empowerment. For example, we applied AI Juicy generated a picture to our intelligence marketing, which really changed alloy you may exit acquisition cost by roughly 9% with larger language loitering, calling our talented marketing team our average Georgetown pay user increase.
I think Kevin Yeah, I program programming has the take 15% of our coding and all these assets are at.
We believe will eventually improve our efficiency.
In the long run.
Oh.
In summary, we have seen some positive signs from the latest published not currently attack and our continuous efforts in improving our profitability is also bearing fruit.
Time points, we are confident to achieve I'll go to generating batch of practical reality that at all.
Correct.
Regarding the asset quality is always the Oh, Jack nation, we fine tune our strategy in Q4 into Q1, leading to a better F. P. D section getting crazy rates prevailing at the new loan issued in the last two months.
Considering the lagging node.
That's a macro comment.
We believe our asset quality is also generally manageable.
Okay.
When you shop.
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Ciena in Tucson.
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So it doesn't need in Asia, but then he thought too.
So Nancy Centricity deep.
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Bastian.
By default.
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The other parts.
Some key partners and the.
Just so you kind of knew you'd gotcha.
So you get that audience I see since you're there you go.
The last one a woman, yes, the GP apologize Jimmy in the infusion suite.
D G Shanghai Sanya I M. A C Nielsen he's sometimes the tusa.
Mr. Xu.
You bet.
[noise], Okay, and I was kind of at.
Okay I'll comment on that.
Sam.
So what were the weaker than expected macro environment in Turkey continued its momentum in Q4 as a result of underperforming macro statistic liquidity tension in credit markets and it doesn't take too long cultural by telecom carriers.
Matrix for the overall loan portfolio.
They're trending up in Q4.
In our view the macro uncertainty as well as the lung country issue may continue to put pressure on our risk management and just yet, but we do see improvement in the latest economic data and the market liquidity.
Our day, one delinquency ratio has been consistent tamping lower from the peak level.
November.
From our biggest 10, a penny pick backup we would take a more prudent approach in terms of risk appetite with all these aspects we aim to lower our intake of loss for 2024, new loans by 10% to 15% compared to 2023.
Operator.
Okay.
Thank you.
Our next question comes from the line of Anna She from Banc of America Securities. Please ask your question Emma.
He wanted to work with any I guess, Alan he's forgotten.
So don't worry about that especially when we had no go anyhow.
Can you quantify maybe how do you think that I should know if I answered it.
Following that I'll share a couple of things he might take Oh, My God Oh My God.
T J E T.
Yeah, she got called out.
Keith I'll, let you got I do get questions about how the car yeah, no worries that way have you ever saw Oh don't worry about it but she was.
How he could cause she's got that don't see what you don't see that don't want that you had enough. So I noticed that you keep your dividend payout ratio at 20% to 30% population I attended 70% and then outside meal Ah shall hold that share buyback plan of 300.
50 million U S. Dollar there you mentioned some of the kind of situations behind I. Just wondering if such shareholder return is about in alone had could you share more at Kathy duration Ah well with us.
Thank you.
Okay.
Ah Thanks, Sam I think as we mentioned in our prepared remarks, we consider this a combination of dividends and the share repurchase as a lasting kind of the measures we're going to take to return to our shareholders in terms.
The mix between the two from time to time, depending on the market conditions may change.
But you know at the intensity of these kind of a return program.
Probably be similar to what we see in 'twenty, 'twenty, four which was announced in the.
Other words up you know if we consistently are doing the repurchase and the dividends for the next say three years.
It could possible we see the the.
Shrink of our total share count by roughly 30% or even more and based on current share price. So.
Basically what we're trying to say is that we view given our current cash flow position.
We view that returning to shareholders, it's a very important.
Long term twos.
To the to the company and you know.
So we will continue to do that and year by year.
Yeah.
Thank you this is very encouraging.
Alright, thank you.
Alright, Thank you Anna.
Our next question comes from the line of Yeah, Tao Li found C. ICC. Please ask your question Yada.
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I wrote to you.
Dumbledore without consumables have motion downturn, John that you go downhill.
Either you're going to be on one or two sure.
No I don't see I shouldn't.
No one doing some shoots when you go to something like how do you, obviously won't be able to continue selling them.
Sure.
Once you know what your assumptions are downswing fueled in Fuzhou China.
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To me it would come down if you don't quite chunky.
Oh, So you sound like when its going to just see your what you're hearing from Keybanc go find answers you're talking about okay. So everybody's home.
I will do my translation. Firstly I was wondering what are the percentage trends of deep Reds facilitation models, including the microcredit no guarantee the model and the capital light model unit volume going forward and considering the microenvironment on which one is preferred by the financial institutions in our sector.
I've noticed that there was a notable growth of the ICU or both in volume and percentage during busier on what can we expect regarding the U S E.
Thank you.
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Uh huh.
If you don't do give more sure.
Be it sure.
There were times when our.
I don't want you can get them to agree with Joe Shan.
Young woman potentially gym membership visuals.
Motivation that there.
That's a good peak either.
We can do that work.
Good to hear.
The final degree in New Jersey.
Do the comparisons on your decision.
Turnkey that shadow AUM and Cook them, what is your attitude or take rate.
Unfortunately that did put a mortgage on that issue.
It shouldn't be a good together shoulder you'll find a woman that you didn't want to go with them.
But isn't that make them more shop window, she one time ago yoga and integrated position.
I'm just really the good news.
So it seemed like the emotion that women.
Our son Nguyen.
They can.
Jim would you go Oh, Hello women to get from Trulia.
If you go to infinite women could you kind of do the deal with <unk> T.
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I know that you could see some.
Incidentally, we deal with it.
Chisholm, John how did they get to agree with that decision how do.
Do you envision them being underway.
Every time and negotiating agenda.
I mean, that's what's.
We came out of that kind of on a woman and you got to wait.
And she should shoot situations et cetera.
To kick off with one more shot.
Jean Michel would you.
And just going with the competitor you're good.
Sometimes I think.
And she's young women Gen sequencer that'd be great.
Okay.
Yeah.
Yeah regarding your question about the loan mix I think at this stage basically we won't okay tagging for already don't make traction is that we target to diversify your funding partners a partnership structure adjust our loan mix and asset allocation strategy to ensure.
Our overall take rate in the meantime, we strive to ensure that matching and allocation efficiency.
The partnership costs and it boosts to our take rates for each each of the.
Those categories.
As you mention let's take I E. For instance, we managed to diversify our funding partnership and optimized asset allocation and the ICD.
Which resulted in an overall 15.
And 15% year over year increase.
I was having a take rate for I C E O Q4 tiny tiny.
So we ice's contributing more in our overall profitability is also improving.
This year, we will continue to come that this strategy to improve our pushing on efficiency and the different models and to make dynamic adjustments to our loan mix to improve our overall take rate.
Thank you.
[noise] soon because it really is.
Thank you yeah.
We have reached the end of the question and answer session. Thank you very much for all your questions.
I'll like to turn the conference back to the management team for any additional closing comments.
Okay, and thanks again for joining us for the conference call. If you have any additional questions. Please feel free to contact us offline. Thank you.
Thank you that conclude.
Today's conference call. Thank you for participating you may now disconnect.