Q4 2023 LexinFintech Holdings Ltd Earnings Call
Welcome to leasing Fintech fourth quarter 2023 earnings conference call at this time, all participants are in listen only mode.
After the Speakers' presentation there'll be a question and answer session. Two also question. During the session you will need to press star one one on your telephone.
Then he an automated message advising go hand is raised to.
Two of draw. Your question. Please press Star one again, please be advised that today's conference is being recorded I would now like to hand, the conference over to your first speaker today Mandy Dong IR director. Please go ahead.
Hello, everyone will come to know what your fourth quarter and full year 2023 earnings conference call I'll read out what is your the earlier today and can be found on our IR website.
Joining me today, our C O G. Yeah.
They are all army and Cao and CFO James Joe.
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 what we're looking statements, which are based on our current plans estimates and projections.
The actual results may differ materially and we undertake no obligation to update any forward looking statements.
Not unless otherwise stated all figures mentioned are in RMB.
In today call Jay will first provide an update on our overall performance RV, we all discuss risk management progress.
Lastly, James will cover the financial results in more detail.
I will now turn the call over to Jay his remarks will be in Chinese and English translation will follow.
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Good evening and good morning, I'm pleased to give an update regarding our performance for the fourth quarter of 2023.
In the face of the current macroeconomic environment and the endless challenges, we adopted a prudent business strategy in the fourth quarter.
We adhere to our strategy of do business growth engine, driven by data and the risk management achieving steady development.
Total loan originations in Q4 reached $61 2, billion% to 9% year over year increase total loan origination volume for the full year was 249 point might beat in a 21, 9% year over year increase.
On balance grew to 124 billion a 24, 5% you only have increased.
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Total revenue for the full year was $13 1 billion or 32% year on year increase.
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In the fourth quarter the industry faced increased challenges due to the slow recovery of macroeconomic weak credit demand and intensified competition as a result, the risk level across the industry went up and the way faced some short term pressure on profitability.
In response, we took a series of measures in risk management, and the refined accretion to mitigate the impact to.
To be specific in terms of new customers. We did last night at the low end of growth with gross system based on you cut the most of them in patient and then jointly built the RTA model in collaboration with platform.
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Please state risk performance matrix of newly issued alone. They go right and entered an improving momentum with nearly one 515% decrease in December this will effectively go to the inflow of high quality customer and to improve the overall asset quality.
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In terms of existing customers in Q4 with folks upgrading credit life granting pricing and a trading strategy system. So I don't know how to think about the competitiveness of top tier customer offers.
The proportion of transactions I Super Prime and Prime customer group increased by 12% compared to the third quarter and the risk level of new loans issued to existing customers decreased by over 15, one 5% compared to the previous quarter.
We targeted potential customers, who previously used our products, but not activates while loan terms or nambla activate their accounts before and then maybe we offered to them without taking a conversion rate increase of over 55 zero percent.
Leveraging enterprise Wechat, we further improve customer service efficiency and the satisfaction accumulating one 9 million followers.
Ooh lease risk management, and the refined operation Madras despite fluctuations in asset quality in the second half of 2023 across the whole loan facilitation sector.
Our overall asset quality it started to stabilize in December with day, one delinquency rate dropped 6% compared to the previous mouse and collection rates remain stable.
We entered 2020 for the quantity of new issue loans has continued to improve and the risk performance indicators of the overall asset portfolio are gradually improving as well our C of O Army will elaborate on this later.
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Bringing down the risk level of our assets going forward.
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In Q4 clean basket Wow, how object and a 36 million in research and development further advancing the application of AI large language models in our operation to improve work efficiency and the customer experience.
Through advanced training, our large language model can automatically analyze multiple state hustling and identify users industry application repayment intention and other relevant information.
This capability enables us to create differentiated and the personal like customer profiles and the laboring system, allowing us to implement ITAR driven precise customer segmentation strategies.
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In 2024, we will focus on the following key areas.
Bringing down risk level of overall assets and enhancing profitability.
We recently upgraded our risk team and inviting Mr. Chow Jan wants to join Us our Seattle.
Mr. Tao has over 10 years of experience in and Cook managing more than trillions of assets and has extensive experience in risk management space.
Under his leadership, we have gained a deeper understanding and set clear goals for improving our risk management framework and are developing a full lifecycle with management system.
Accordingly, we have planned out specific measures.
Yeah, our hat, we will implement risk imagine more work in three main aspects new customers existing customers and loan collection.
For the first aspect for new customers, we will continue to increase customer acquisition efforts strengthen the development of our own customer acquisition channels, especially targeting white collar newcomers blue collar workers, and a mini or micro SME owners.
The effective dynamic row strategy of low end grill, what about improved credit profile identification of high quality customer groups.
Increased volume of high quality, new assets and drive down the overall risk of levels.
For the second act that for existing customers.
We will strengthen the construction of underlying identification capability and the match differentiated strategy based on different customer segments.
Kimberly we are applying flexible pricing strategies to widen the price range for different customer segments.
For our high quality customers.
Competitive offer capture a large share of their wallet and the female painlessly lower overall portfolio risk.
With over 200 million registered users.
She still has ample room for growth.
For the fourth third at that in terms of loan collection.
Strengthen collaboration with financial institutions.
And the scope of legal action and improve its efficiency.
We'll continue to advance the development of the localized picture in a recovery integrated system to effectively ensure user experience and impatience in delinquent loans recovery.
Strength and I acknowledge that you have delinquent loans management system.
Such as intelligent routing systems, and the leverage large language models to improve long collection efficiency.
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Secondly, we will continue the hearing to the customer oriented principle and they improve our operation base, Oh, I refined customer segmentation matrix why Hans will strengthen customer credit profiling to offer a differentiated product for various customer segments.
In 2024, well sharpen our focus on the children in Chinese no children, well SME customer segment and looking for high quality consumer sentiment.
And products, such as snow Hawkeye and the speedy lending in Chinese diesel kitchen for growing customer segment.
On the other hand through that dynamic growth strategies.
Low and grow we will serve the customers' needs and imagine their risks throughout the entire lifecycle.
And this dynamic approach, we are able to offer appropriate dropped to their credit needs at each phase of the whole lifecycle.
In addition to various products, we will continue to reinforce our work on the customer rights protection Brown.
Have formed a consumer rights protection Committee and their consumer rights Protection Center.
In 2024, well bathroom meet customer demands and effectively improve customer satisfaction by in housing consumer protections governance system, and then mccann isn't thereby reducing the impact of malicious compliant round illegal groups.
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To show driving force for steady growth of our business.
At Ford have empower them and start this is why we will invest more in customer acquisition and the extent to more city commercial banks and the rural commercial bank, which will further fuel the growth in scale and revenue.
As for our offline inclusive loan business in Chinese ports.
We will continue to focus on low tier cities now located in industrial about conducting greet based operation and the target micro SME customers self employed business owners high quality and salary workers and offer more competitive products.
We will continue to scale up our team upgrade sales force management systems enhance the team management and the underlying the differentiation advantage of customer acquisition and the first hand information based credit profile of identification.
As for the ecommerce business, while maintaining our advantages in three C products, we like.
And two more trendy good S K U that attract youngsters.
We have strengthened differentiated trading and risk management strategies at great risk management system.
True you the credit profile of identification accuracy, and uplift approval and the transaction rate aiming to expand scale and profitability.
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Looking ahead into 2024, we will adhere to prudent operation principals prioritized risk management and the maintenance Daddy growth in transaction volume throughout the year, we are confident that as our skills expense and risk performance continue to improve our profit up.
But he will further increase we'll continue our recurring cash dividend program and in house, who just returned.
Board had approved the plan to distribute cash dividend of approximately 0.066 U S dollar per a D. S for the second half of 2023.
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I will hand over the floor to our CFO army to discuss risk management.
Please go ahead.
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Thank you Jay I'm glad to give an update regarding the risk management performance in Q4.
Let me give us two worst introduction about myself I joined the Louis C. In December 2023.
Prior to that I served at and group for over 10 years in charge of the holistic risk imagine the work of consumer credit products, such as and why do they and I debate I also served as the Deputy General manager and consumer Finance company in Chongqing.
Overseen comprehensive risk management for consumer finance.
I have deep involvement in the construction and the integration of <unk> consumer crowded with Madden system.
It tends to have a practical experience in building with amendment team innovative risk management technology, and the consumer crowded with management.
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In Q4, our asset quality showed some pressure now.
Due to the slow macroeconomic recovery weak consumer demand and the turmoil in the loan collection industry, which resulted in fluctuation in the risk performance of our existing loan book, we have taken timely and effective counter measures to mitigate the impact.
Including strengthening risk identification capabilities, bringing classified customer segmentation in housing, which commandment of existing customers.
Upgrading with management towards and accelerating talent acquisition.
Looking at the asset quality of over or loan book.
P D seven of newly issued loans reached its peak level at the beginning of Q4 2023 and have seen speaking gradually trending better or a monthly basis.
The day, one delinquency rate of the overall asset reached its peak level in the middle of Q4.
And that has been improving month by month.
Its lowest point recently with over 10% improvement compared to the peak level.
The collection rate of the overall asset started to come under pressure in the second half of 2023 but begin to stabilize and recover from January 2024.
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Next let me give you an update regarding the major progress we have made in risk management work stream in Q4.
Firstly in Q4, we further strengthened our risk identification capabilities.
The data Brown, we conducted in depth joint modeling with several leading platform based internet companies.
By fully leveraging their massive amounts of scenario with data we have greatly improved the accuracy and the stability of our risk scoring models.
Additionally, in the development of risk models, we have introduced and up height cutting edge algorithms.
Time series models and relationship graph model effectively expanding our risk identification capabilities in the temporal and spatial dimension.
Based on features scenario data and the model algorithm, we have comprehensively iterate and upgraded the risk management system for our three core business lines that are consumer finance offline includes financed in Chinese weight and E Commerce.
The performance of our risk identification capabilities.
An improvement of nearly 33 zero percent.
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Secondly in Q4, we reconstructed our cut the Muslim mentation by using customer basic information has good credit profile and the customer credit scores to classified customers into four categories that are super Prime and prime.
Near Prime and subprime.
Compared to the previous Petsmarts implementation did this new approach has significantly improved risk level depreciation and the stability among various customer segments.
In the consumer finance business line, we have a reconstruct the risk strategy and accretion no system throughout the customer lifecycle based owned and you cut the most implementation.
This has led to a 35% increase in credit approval rate and a 10% decrease in risk levels for new customer loans.
In the future, we will further enhance our prestigious targeting of high quality customer groups and the leverage at dedicated ROE strategy system to boost the draw down rate of high quality customers.
Expanding the scale of high quality asset.
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Thirdly in terms of risk management for existing customers, we have upgraded and improved the ova or crowded approving pricing and the transaction strategy system.
They're all refined risk management for different customer segments, we have in house the competitiveness of offers.
Our Super Prime and the prime customer groups the ratio of G. M. The loss volume for our Super Prime and Prime customer segment has increased by 12% compared to Q3, effectively improving our asset structure and reducing the risk of new loans.
Existing customers I 15, one 5%.
Furthermore, we have achieved he can either kind of reads out in customer orientation through measures improve insurer and recall lots of customers, particularly for our high quality customer segment.
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Firstly, we have further upgraded our risk management tour and they established a standardized risk strategy management process and framework.
This enables tender like data input and decision output as well as the ability to orchestrate highly need you liked and complex decision strategies.
This has greatly improved the operational efficiency of risk management system.
Maybe the strategy integration and the launch of new business product the upgraded risk management framework can effectively support end to end and the like the link between risk management and marketing systems.
But the in housing the responsive iteration and the refinement among different parts of our operation process.
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Lastly, as we accelerate the implementation of that formation risks management upgrade mattress. We have also brought in absolute outstanding mid to senior level risk management talents Brown, leading platform in the industry.
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Since you just got done in the next quarter the path to further strengthen risk management around the following three aspects to ensure a continued decline in the risk level of newly issued loans.
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What who come to work on your shoulder Cushing Fuji I'm, chairman and Chisholm to cope with 100 should be a watch and what have you ought to be doing in June should be firstly, we will expand and utilize more core data sources to comprehensively improve our risk identification customer pro.
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Secondly, we will continue to enhance the Modernisation building up of our risk management system, improving the standardization of risk strategies, well transform core input from different dimension into a stand of like the mortgage.
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This will further enhance the standardization and consistency of risk management strategies.
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Thirdly, we will develop in talent and risk management product capabilities by creating multiple product like risk management tools.
Strategy robots and the strategy experimentation path for this to work well further enhance the efficiency and precision of risk management work.
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Looking ahead into 2024, well continue to uphold the principles of risk management priority and the prudent operation.
Without comprehensively upgrading our risk management is a couple of bullet in various aspects, including infrastructure risk management framework with amendment data source more of those strategies tourists and tenants him.
Our goal is to significantly.
Our risk identification capabilities for different customer segments, we will actually be diet. The implementation of multiple with specialized initiatives to strengthen risk management and to refine our ability to match kathman risk throughout their entire lifecycle.
Including larger nation loan servicing and delinquent loans management.
We will continue to enhance our ability to identify high risk customers and employing various measures such as accounts Kroger credit line amount reduction and transaction interception to reduce the generation of delinquent loans with.
With confidence capability and effective method, we aim to achieve a gradual decline in risk level or courtly basis refined asset quality support a steady growth and improve perfect ability margins.
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CFO, Jim it's the last thing John charging she does her watch them work now.
I will hand over to our CFO, James a financial update.
Thank you hover I will now provide more details on that.
Good luck.
Please note that all numbers are in RMB, unless otherwise stated.
In a challenging economic landscape marked by modest economic recovery in consumer spending portion with close to 2023 on a positive note.
<unk> our business targets.
Despite the industry wide risk volatility our commitment to strategic pillars rigorous rigorous risk management.
Customer segmentation and upgrading operational refinement and cost optimization.
Fortified our financial framework and yielded positive business results.
I'd like to highlight a few points related to our operations and the financial progress from last quarter.
Okay.
Loan origination and profitability growth.
Despite the controlled low growth in response to the industry risks in Q4, we have recorded commendable low volume and profitability increase over the year.
Our Q4, <unk> reached $61 2 billion, a three 3% sequential decline, reflecting our tightened credit standards and our focus on quality growth.
So the annual loan originations grew by 21, 9%.
$249 5 billion with outstanding loan balance of 24, 5%.
Annual revenue surged by 32% and net income spiked by 56, 2% excluding investment related impairment losses.
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We have demonstrated strong and resilient revenue generating and growth capability.
Despite the <unk> year over year growth of only nine 2% in Q4, the revenue growth outpaced at 15, 1% year over year.
In Q4, we have continued to lower borrowing costs for all users.
We cut the weighted average APR five 4% to 23, 7% from 24, 1% in Q4, a year ago, therefore, resulting a 40 basis.
In pricing.
Additionally, as a general practice to reduce the risk exposure, we have shortened the new loan tenor from average of 13.9 months to $12 three months.
The 40 basis point decline in pricing the shortened pillar along with the industry wide risk frustration.
Not significantly impact the overall Q4 revenue take rate, we only saw a marginal revenue take rate dip of 25 basis points to 2.47% from 272% of a year ago.
This is due to the strong positive revenue upper body uplifting effect from lower funding costs and the continued improvement in customer early payoff.
We have recorded a historically low funding cost of six 8% in Q4 down 63 basis points year over year.
We achieved this through improved funding and partnerships with cost efficient national financial institutions. The funding costs hit a new low record low level below 6% in February.
And we expect that this downward trend to continue going forward.
We have taken some proactive measures to reduce the borrowers early repayment the repayment ratio lower to only 87% of peak level in 2023.
Certainly.
We have substantially optimized our cost structure.
We trimmed down the total expense, including the processing service, just marketing R&D and G&A as a percentage of average loan amount from four 1% in Q4, 2022% to 388% in Q4 2023 test.
Through the execution of cost optimization project.
One such example is the user acquisition cost.
We realized a big saving all acquisition cost per user in Q4, that's to our upgraded Archie a marketing model and more attractive loan offerings.
Our sales and marketing expenses ascended a bit by four 6% compared to last quarter, while our new APA. The users with approved credit lines and a new active users grew much faster at a rate of 21, 5% and 35, 7%.
Could you indicate a 14% and 717% unit acquisition cost saving respectively.
Both.
The risk fluctuation and its impact.
Industry wide receiver frustration during the second half of last year have impacted us as they did to our peers.
Asset quality metrics have shown signs of stress, including the D. One delinquency rate and one collection rate and the 90 plus days delinquency rate.
90, plus day delinquency rate moved to four 9% versus $2 six 7% in last quarter.
We have enough good risk mitigation strategies that are stabilizing the situation.
Close to the end of the year in the early part of this year.
The immediate financial impact is a sequentially almost flat revenue in Q4, and the increased provisioning of credit impairment costs.
Total provision related cost items, including the provisions roll financing receivables.
Provision for contract assets and receivables.
Provision for contingent guarantee liabilities and the change in fair value of financial guarantee deliberative in loans at fair value increased by seven 1% on a quarter over quarter basis due to the increase the pressure on our asset quality is before.
We are maintaining an ample bad debt provisions remained a robust coverage ratio of approximately 317%.
Which is defined as a total provision amount divided by the principal amount of 90 plus days delinquent loans.
Apart from the above four operation really the highlights I would like to elaborate a little bit more on a specific.
Items from financial statement first.
First investment related impairment losses.
The major impact our earnings came from the investment impairment related to a domestic investment of a probably back.
Excluding after tax impact of 224 million renminbi of investment related impairment losses. The net profit for the fourth quarter was 236 million renminbi with a net margin of six 7%.
Yes.
Second some notes on our revenue line items.
Anti income grew Saturday by 11% on a quarter over quarter basis, and a 42% on a year over year basis due to continued continuing releasing from the existing loan book.
Heck empowered services fell 6% for March quarter, they increased three or four.
4% from last year, primarily due to the reduced volume you can empower the business.
Okay.
Third some notes on cost line items funding.
Funding costs on our income statement, which relates to our off balance sheet loan generation.
Dropped significantly by 42, 1% quarter over quarter and by 47, 9% year over year due to the maturity of a portion of trust funding in Q4.
Additionally, the processing and servicing costs increased by 15, 3% in Q4 compared to the previous quarter due to the increased risk management initiatives and projects.
General and administrative expenses rose by 26, 6% in Q4 from last quarter due to the addition of more risk management talent.
Fourth our balance sheet items.
Our cash position is strong ending the quarter with $4 4 billion in head and a solid equity position of $9 7 billion.
We continued our cash recur.
Recurring cash dividend plan and declared a cash dividend for the second half of 2023.
<unk> around pinpoint 8 million U S dollars.
Equivalent to roughly 20% of total net profit for the second half of 2023.
2000, Twenty's recombine dividend payout is about <unk>.
0.18 to U S dollars per you'd yes, yes, with the dividend yield at a roughly 10% based on the closing price of 2022.
Looking ahead, we will continue to either maintain or increase the dividend payout ratio to our shareholders when the market conditions improve.
Looking forward to 2024.
Due to the uncertainty of the economic growth and our prudent approach, we expect to be annual G. M. B a month for the full year 2020 pool to be no less than that of last year. As we remain focused on the enhancement of risk management as a top priority at <unk>.
Net profit will grow from last year as well.
In February.
So how do you do this REIT was a year of rebound with a strong growth in both top and bottom line, surpassing many peers driven by our core strategy.
We remain focused on improving risk management capabilities.
Grading user groups operational excellence and cost optimization to capitalize on emerging opportunities.
That concludes our prepared remarks, operator, we're now ready for the Q&A session. Please open the floor for questions. Thank you.
Thank you very much we will now conduct the question and answer session.
As a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced.
Sure Joe Your question. Please press Star one again.
He's currently read your question in English and Chinese.
Please standby as we compile the Q&A roster.
Our first question comes from Alex <unk> of UBS. Please go ahead.
Go ahead because.
Because it goes up you wanted to play with it.
Okay. That's helpful.
Thank God my.
Coupons have been.
How long you don't tell me about it.
Hmm.
Thank you Gail.
Yeah.
<unk> chosen the transactions have been eager to what I'll call here.
<unk> got an issue.
I have two questions for Mr. Chao, who currently with the charge off in the management.
Turning to order patterns consumer loans.
Thank you had been looking for several months now we would like to learn about the.
The key reason that have not due to a truth that Jonathan.
What was the main challenges and opportunities.
John Thank you.
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Let's ensure commvault is already to you Tony the Java genome Shanghai or on T. Layla.
One daughter cohort totally on either to food.
Cool.
Okay.
Andrea can you actually do that so I'm sure that they report on loan Tagalog, George <unk>, who could talk from part of the shelf as well.
Without cause you to Jim General Michelle on your Chinese just Utah launched industry or food alcohol.
How would you put up all countries are looking at Coke, where you go home and take off a record year.
Sure sure lodging downturn do you go from January <unk>.
Yes young be accurate to assume that you don't go there you go to Kim Dang.
I'm, Jeff hung goatherd, surety Ghansham BP dotcom food or they don't.
How come you can run your T. He could judge under you got from <unk> from him one in EMEA that you could get sure. He showed you Amanda Francona me or hazard oil change increase Pompidou alerting from Gen. Three P M.
Yeah. Good luck at shot.
Shuang <unk> sanctioned that is younger than ever going downhole.
D J lo hanging over produce at him.
Yeah.
Gentlemen.
Yeah. There you go from switching.
So now comes down chimneys, Sandeep <unk> attempted to go deeper negotiation.
So either a function ducker shot Yahoo Young D. Neither you got yourself, we're gonna way, we lap harsher.
We bought how should it be Jojo Shan Shan Li Okay acts. This is Mandy let me do the translation for Mr. Arming them, where I made my decision to join licensing tact around well several key considerations firstly nothing thing having done one at the earliest established consumer finance platform in.
China. It has accumulated over 200 million legacy users with immense growth potential and unless he has built a unique lewis in consumption because at times and it consists of our various business lines, including consumer finance offline close finance, a cool way ecommerce and stuff.
No.
Well, we see their recommended C. Net synergy potential amount of these business lines. So in my perspective, nothing has a very solid foundation and a strong customer base.
For the second point. The recent you can see the risk level I forgot his assets nowadays dance at that could be higher level, when we compare it to other industry peers.
I'm very confident that by implementing our proven quantitative risk magnet Seaton and in housing are further refined risk management, we can bring down the risk level of our listing assets to match industry average level and in the future.
Furthermore, we can gradually improve to the level of the industry. In addition, the company current P/e ratio is quite low that may indicate and param for returns.
In the future, we can gradually bring down the risk level and the profitability will increase.
Yeah.
We really think the charges you from you on Mojave Foods, which is in Colombia, and the use of the Samsung who do the Yanbu Hershey from you don't show them in the continental.
And I'm sure Bob Hope you.
Choose <unk> co.
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Moshe Malaysian don't move work that was younger deduct Annie's yet from game Kings Hill.
Hope, you're all Noncritical, India your phone for them in the future.
No should be elation, all quarter to watch on let Shan Shan outlet Thunder.
Andre Townshend Garfunkel, she sees something John.
In fact, now who will end up being born trying something good I'm going to cheat sheet uncle Wuchang, Hong Kong country, Yes, Jumpy, you don't show of ICL surgeon integrate well do that project should be or to Houston.
Sure a change I mean due to the Hong Kong T ship cargo to Noah Hong Kong Geophone, yet due to develop for the Qingdao Chongqing and Nanjing kosher embark on per time to June which I'm glad you're on Gen. Three we actually had a job.
Well after the past few months of my work in risk management space I see they may be but theyre rooms in borrowing 0.1st nothing has he utilized a lot of third party data source that may lacking in quality in the future or in the future we will improve that.
Model I E.
Introduce more a data source and improved mono stability and risk identification accuracy. They candidly the risk model nowadays many in the crowded rating credit, scoring type, which shows a lack of variety in the future will incur.
More different types of models, including the credit profile type, we're supposed to Venice type.
There is still room for them also thirdly, theres still room for improvement of building a more robust risk management system and done more sufficient area of risk Mad men tour.
Over the past few months, we have already made notable progress in upgrading risk identification system, establishing a full lifecycle with magnetic Tim building in Canada is meant to do.
Cheap to the above mentioned Madras are we see the asset quality, a and B you should almost already showed a turning point things that Nokia and with risk level declining on a monthly basis.
And I hope that.
<unk> can address your question.
Yeah.
Okay I gotcha, okay.
Thank you.
Our next question comes from Yodlee off see ICC. Please go ahead.
Okay.
Oh go ahead, Tom Hogan to deal with it if you wanted to you would argue that sound sound way.
Okay. So do you do it.
The teams, who do I cut moments come eligible shortly.
Since I'm the legal channel.
Sure.
And I'm talking about an initiative there you can totally.
She was one of those that got a new challenge and when it comes out in Q2 is always so what's the deal with Apple.
Cooper.
Corporate Kindjal, Okay. Good morning, Phil.
I was with the translation from the fourth quarter results.
The new users with credit line went up by roughly 17% Q on Q, while the sales and marketing expenses grew by only 5%.
I think it indicates a significant improvement in customer acquisition efficiency.
And can management share some more recent moves and efforts there.
From a acquisition.
Thank you.
Oh the <unk>.
G user cohorts similar to touch all while maintaining both Houston, Oh, Canada, although it's other than Liberty hardware promotion of it.
So seeing no sohail, so hi, tayo, let him the low end of that $10. So the tissue.
Although I will tell you about some built without this whole thing cobos all your thoughtfulness that would've been 10 minutes. He thought it was.
This was.
Due to the three on Yahoo.
Yeah, Youll unusual at that time, when you'll do a cocoa doesn't go there you go so youll see US. Another was also a function of you about so that's what you guys have done with it whether you thought you got you well yeah I'll I'll do the translation for Y J.
First of all you see in Q4, we upgraded our pay model and the strategy based on our enhanced risk identification of capability, we adopt it low and grow gross jafferjee the credit line approval and draw them. This resulted in a notable improvement up you, though with Craig in La.
<unk> increased by 14, four zero percent credit drawdown by the good quality users increased by 45% and with level of those newly issue long consistently decreased on a monthly basis.
A global media and telecom.
Talking about pink and boil public a little quicker, but in years. So you know.
Oh, gosh, without Hawker and Batangas and they'll go through that.
But will the co Chinook shingles.
You can call a woman.
But by the time to listen to you.
Hello, Paula cushions How're you bother them what are you guys seeing the cause or there you go puzzle.
Gentlemen, just a holding in English.
I'll wait cochin or southern cooking than Toyota.
So something in the Toyota and whether you've got somebody that can cope with that.
Secondly, we have put more efforts to diversify our channels in terms of customer acquisition, rather than like in previous solely relying on the online advertising channel. So we tailored products and services in.
In the Patriot in knees for different customer segments.
We achieved a depreciated and the diverse customer acquisition matrix well to be more specific for the fresh graduates micros SME owners Super Prime and Prime users, but also developed custom acquisition approach and the product.
Operator.
We can see I'll open the question to the next.
Maximum Nissan that.
Thank you.
Yeah.
Our next question comes from.
<unk> being sold of CLSA. Please go ahead.
Yeah.
I have some thoughts on how that's what they want to know if you wanted to do quick what sounds to wage ourselves on the ochsner. That's done a job he talked a little about that phone so unless they took whenever things do coupons or whatnot. It seems like that that you pushed out can you. It sounds like you don't want is all those things should probably hold at least through the phone so I'll call it or not.
Let me do a translation so as Jay mentioned in his remarks, nothing has lunch the multiple growth strategy paying 24, that's the slow recovery of the domestic economic and intensified competition in domestic market more and more he has begun to expand the business internationally. That's what she has to say middle of business plan.
In the future. Thank you.
Okay.
Formulary.
So what I'm, telling you that.
So.
Although this is a oh, well I mean it definitely.
Oh sure so without trying to sell them.
Ooh toward.
More turnkey data visits you know could you let me into Hawaii. So then go home.
Oh, there you go.
Geneva Click and then you also saw a woman she said.
Uh huh.
Well I mean using tissue that you have put you into a car. So that's hopefully towards clearly they've got you okay.
We will post a copy.
That's what I thought maybe I'll talk to you then.
Women Youre eating away more well then that I guess.
Bob will go home.
Yes, you are right definitely.
Pending internationally is one of the our key growth strategy and nowadays we have already had some business rounding in the overseas market in 2024, we will expand business in some selected oversea market.
Well by acquisition, we're building the business around the ground up by ourselves.
We are confident to replicate our success in China market to overseas.
But the business volume of our own business is lumpy, but we will.
Update more to the market once we achieve more progress in the future.
Okay.
Well operator, if there are no further questions light, maybe that's all that stuff come to the end of our call today.
Thank you I see no further questions at this time.
Thank you all for coming to this call conference call.
This is the end of our conference call. You May now disconnect have a great day everyone.