Q2 2024 FinVolution Group Earnings Call

Yes.

[music].

Operator: Hello, ladies and gentlemen.

Operator: Hello, ladies and gentlemen.

Hello, ladies and gentlemen, thank.

Operator: Thank you for participating in the second quarter 2020 for earnings conference call.

Operator: Thank you for participating in the second quarter 2024 earnings conference call for FinVolution Group.

Speaker Change: Thank you for participating in our second quarter 2024 earnings conference call.

Operator: At this time, all participants are, in listen-only mode.

Operator: FinVolution Group.

Operator: Thank you for joining.

Speaker Change: Sinfully cigarettes.

Operator: At this time, all participants are in listen-only mode.

Speaker Change: At this time, all participants are in listen only mode.

Speaker Change: After managements prepared remarks, there will be a question and answer session.

Operator: After management's prepared remarks, there will be a question and answer session.

Speaker Change: Today's conference call is being recorded.

Operator: After management's prepared remarks, there will be a question and answer session.

Operator: You may now disconnect your line.

Speaker Change: I would now like to turn the call over to your host.

Speaker Change: Upon head of Investor Relations for the company.

Jimmy: Jimmy Please go ahead.

Operator: Today's conference call is being recorded.

Speaker Change: Thank you Melissa Hello, everyone and welcome to our second quarter of 'twenty 'twenty Four earnings conference call. The company results. What you do via Newswire services earlier today and are posted online.

Operator: Today's conference call is being recorded.

Speaker Change: You can download the earnings release and sign up for the company email with less by visiting the IR section of our website.

Speaker Change: <unk> Dot com.

Operator: I would now like to turn the call over to your host, Jimmy Tan, Head of Investor Relations for the company.

Speaker Change: Generally our chief Executive Officer, and Mr. Jacques Van <unk>, Our Chief Financial Officer, We will start the call with prepared remarks, and conclude with a Q&A session.

Operator: I would now like to turn the call

Speaker Change: In this call we will be referring to several non-GAAP financial measures to review and assess our operating performance. These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U S. GAAP.

Speaker Change: Information about these non-GAAP metrics and reconciliation to GAAP measures. Please refer to our press release.

Speaker Change: Before we continue please note that today's discussion will contain forward looking statements made under the safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 90, 95 forward looking statements involve inherent risks and uncertainties.

Speaker Change: The company results may be materially different from the views expressed today further information regarding these and other risks and uncertainties are included in the company's filings with the U S Securities and Exchange Commission. The company does not assume any obligation to update any forward looking statements, except as required under applicable law.

Speaker Change: Finally, we post a slide presentation on our.

Operator: over to your host, Jimmy Tan, Head of Investor Relations for the company.

Speaker Change: Our website, providing details of our results for the quarter I will now turn the call over to our CEO. Dr. Kennedy. Please go ahead Sir.

Operator: Jimmy, please go ahead.

Jimmy Tan: Terima kasih, Alison.

Dr. Kennedy: Oh, Thanks, Jamie Hello, everyone and thank you for joining our earnings call today.

Jimmy Tan: Jimmy, please go ahead.

Speaker Change: Giambi steel altimo.

Jimmy Tan: Helo, semua, dan selamat datang ke panggilan konferensi Earnings Kedua Ketua 2024 kami.

Speaker Change: Yeah happy to speak with you today.

Jimmy Tan: Thank you, Alison.

Jimmy Tan: Keputusan syarikat telah diluluskan melalui perkhidmatan berita lebih awal hari ini dan telah ditulis dalam talian.

Speaker Change: We ended the first half of the 20th plentiful on a positive note.

Jimmy Tan: Anda boleh menghantar penghantaran Earnings dan menghantar alamat e-mel syarikat dengan melawat bahagian IRR dari situs web kami di irr.finvgroup.com.

Speaker Change: Drubbing progress girls in the China market, well continue our rapid growth momentum internationally.

Jimmy Tan: Hello, everyone, and welcome to our second quarter 2024 earnings conference call. The company results were issued via newswire services earlier today and are posted online.

Jimmy Tan: You can download the earnings release and sign up for the company email alerts by visiting the IRR, section of our website at irr.finvgroup.com.

Jimmy Tan: Mr. Tiezheng Li, our Chief Executive Officer, and Mr. Jiayuan Xu, our Chief Financial Officer, will start the call with their prepared remarks and conclude with a Q&A session.

Speaker Change: So determining strong execution of our local excellence global outlook, stretchy or simply L. E G O legal strategy.

Jimmy Tan: Mr. Tiezheng Li, our Chief Executive Officer, and Mr. Jiayuan Xu, our Chief Financial Officer, will start the call with their prepared remarks and conclude with a Q&A session.

Jimmy Tan: During this call, we will be referring to several non-GAAP financial measures to review and assess our operating performance.

Jimmy Tan: These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with US GAAP.

Unknown Executive: We made great strips across our business in the markets in which we operate. Cumulatively, we have served around 31.5 million borrowers across China, Indonesia, and the Philippines as of June 30, 2024. During the first half of 2024, transaction volume for the China market reached 92.5 billion RMB, a 6% year over year. In terms of outstanding violence, China reached 64.2 billion RMB, while our international markets rose to 1.4 billion RMB of 3% and 27% respectively year over year. This standard performance stands out as a testament to the effective execution of our legal strategy and the unveiling commitment of our team.

Jimmy Tan: During this call, we will be referring to several non-GAAP financial measures to review and assess our operating performance. These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. For information about these non-GAAP measures and reconsideration to GAAP measures, please refer to our earnings press release.

<unk> made great strides across our business in the markets in which we operate.

Speaker Change: Cumulatively, we have served around 31 5 million borrowers across China, Indonesia, and the Philippines as of June 32094.

Jimmy Tan: Before we continue, please note that today's discussion will contain forward-looking statements, made under the Safe Harbor Provisions of the U.S.

Jimmy Tan: Private Security Criticization Reform Act of 1995, forward-looking statements involved inherent risks and uncertainties.

Jimmy Tan: As such, the company results may be materially different from the views expressed today. Further information regarding these and other risks and uncertainties are included in the company filings with the U.S. Securities and Exchange Commission.

Jimmy Tan: The company does not assume any obligation to update any forward-looking, statements except as required under applicable law.

Speaker Change: During the first half of 'twenty 'twenty four transaction volume for the China market reached 92.5, beating RMB up 6% year over year transaction volume for international markets to continue to grow rapidly starting to focus on five billing RMB up 30.

Jimmy Tan: Finally, we post a slide presentation on

Speaker Change: 32% year over year.

Speaker Change: In terms of outstanding balance, China reached $64, two beating RMB well our international market showed two one point both beating RMB.

Speaker Change: 3% and 27% respectively year over year.

Jimmy Tan: Untuk maklumat mengenai peraturan yang tidak ditentukan dan pertimbangan untuk peraturan yang ditentukan Sila hubungi Earnings Press Release kami, Sebelum kita lanjutkan, sila perhatikan bahawa perbincangan hari ini akan mengandungi kata-kata yang menarik yang dibuat mengikut peraturan Safe Harbor dari AS, Reklaman Penyelamatan Keselamatan Peribadi Agenda 1995.

Speaker Change: This has led our performance.

Speaker Change: A testament to the effective execution of our legal strategy.

Jimmy Tan: Kata-kata yang menarik yang terlibat dalam risiko dan kebiasaan yang tidak pasti.

Jimmy Tan: Seperti itu, keputusan syarikat mungkin berbeza secara material daripada pendapat yang dikongsi hari ini.

Speaker Change: And we re commitment of our team.

Unknown Executive: Customer acquisition is a key element of our legal strategy. We view it as an ongoing investment that will ultimately lead to a higher percentage of vital quality, repeat borrowers and drive sustainable girls. During the second quarter, our number of total new borrowers reached 8.2 billion and 23.2 billion, up 22% year over year and 15% sequentially. While updating our ability to grow our business across different countries, notably as we completed the transition to better quality borrowers in Indonesia and began to diversify our business model. The percentage of new international borrowers once again surpassed the percentage of new China borrowers.

Jimmy Tan: Perkara lain mengenai risiko dan ketidakpecahan lain dikongsi dalam fail syarikat bersama Komisi Keselamatan dan Pertukaran AS.

Speaker Change: Customer acquisition is a key element of our legal strategy.

Jimmy Tan: Syarikat tidak bertanggungjawab untuk mengucapkan kata-kata yang menarik, kecuali yang diperlukan di bawah kata-kata yang boleh digunakan.

Speaker Change: We view it as an ongoing environment that will ultimately lead to a higher percentage of bioterror quality repeat borrowers and to drive the sorts of technical girls.

Jimmy Tan: Finally, we post a slide presentation on our IR website providing details of our results for the quarter.

Speaker Change: In the second quarter, our number of total new borrowers reached 800, and the 20th century thought is up 22% year over year and 15% sequentially.

Jimmy Tan: I will now turn the call over to our CEO, Mr. Tianzhen Li.

Tiezheng Li: Please go ahead, sir.

Speaker Change: Well it <unk>, our ability to grow our business across different countries, notably as we completed the transition to bite her quality birth in Indonesia, and it began to diversify our business model.

Tiezheng Li: Thanks, Jimmy.

Speaker Change: The percentage of new international borders by stocking surpassed the percentage of new trainer borrowers.

Unknown Executive: Furthermore, our number of new borrowers in the Philippines continue to grow robustly in the second quarter, increasing by one hand root in the 98% year over year and the sixth, 69% sequentially. Our effective social media strategy in the international markets also continues to yield positive outcomes. As of the end of the second quarter, our followers on leading social media platforms such as Facebook, TikTok, and Instagram had risen to approximately 1.3 million, 850 solid, and 240 solid, up 41%, 30%, and 8% year over year respectively. While updating the strong brand awareness of deep localization, we have created a market.

Speaker Change: The more our one.

Speaker Change: Our numbered open your birth in the Philippines continued to grow robustly in the second quarter.

Speaker Change: Increasing by 100, and the 19, 8% year over year, and a six 9% sequentially.

Speaker Change: However, effective social media stretchy in the international market also continued to yield some positive outcomes.

Speaker Change: And as of the end of the second quarter, our followers on leading social media platform, such as Facebook take talk and describe how do you read that you are probably today at 1.3 made at 850, Salt Lake and the 240 soldier up 41% to 30%.

Speaker Change: And 8% year over year, respectively.

Speaker Change: Validating the strong brand awareness of deep localization, we have created in our overseas market.

Unknown Executive: As a theme-type leader, technology is deeply engraved in our DNA. It remains the core of our business and our primary competitive age during the second quarter. We halted an internal-type competition called Haixong, bringing together six R&D teams for a 36-hour session in a color-style environment. Vinyu project included admin AI bots, which can incorporate API function calls into larger language models. Its framework can also be expanded to include multiple internal tools and support the management of different tools across platforms. Another standard e-sound, leverage AADC to utilize fragmented time slots to increase productivity. We believe this project demonstrates great implementation potential for enhancing our operations and overall efficiency.

Tiezheng Li: Hello, everyone.

Speaker Change: As a few type leader technology, it's deeply engraved in our DNA.

Speaker Change: It remains at the core of our business and our primary competitive edge during the second quarter, the Hulk stage internal typed competition called Hexcel.

Speaker Change: Bringing together six take R&D teams for a 36 hour station KOLO stock environment.

Speaker Change: Vineyard project included the mean, AI bots, which kind of encourage API function calls into larger language models.

Speaker Change: Its framework can also be expanded to include multiple internal tools and to support the management of deferring the truth across lifestyles.

Another standout isaacs leverage Aig's, two Yo Yo Yo Tonight.

Speaker Change: So I commend take time slots to increase productivity.

Speaker Change: We believe this project demonstrates great implementation potential for enhancing our operations and overall efficiency.

Unknown Executive: Next, I'd like to share some updates on our ESG progress. We recently published our 2023 ESG report, the sixth in our company's history, highlighting our dedication to transparency and sustainability. In 2023, we launched our mission of leveraging innovative technologies to make financial service better, as well as our ESG strategy centered on technology, green principle, and candidates. In addition to giving back to society with innovative technologies, the evolution and precise integrity and compliance, low carbon development, and harmonies relationships with employees, partners, and communities in its ESG management efforts. Moreover, we continue to spot small business owners through the second quarter's challenges.

Speaker Change: Nice I'd like to share some updates on our ESG progress.

Speaker Change: We recently published our 2023 ESG report the stakes in tower companies history.

Speaker Change: Highlighting our dedication to transparency and it's supposed to.

Speaker Change: That's a 10 debated it.

Speaker Change: In 2023 advanced our mission of leveraging innovative technologies to make financial service biter.

Speaker Change: As well as our ESG strategy centered on technology, Corrine principle and kindness.

Speaker Change: In addition to giving back to society with innovative technologies.

Speaker Change: The evolution and precise integrity and compliance low carbon development.

Speaker Change: Ammonia is your relationships with employees partners and the communities in its ESG manager image.

Speaker Change: My first.

Speaker Change: Moreover, we continue to support small business owners throw the second cultural challenges Europeans.

Unknown Executive: During the second quarter of 2023, we accumulated with several around 415,000 small business owners and facilitated 14.2 billion RMB of loans to neutral their dreams. I also want to highlight our long-standing cooperation with the national weightlifting team, and congratulate them on their recent wins at the Paris Olympics. We are proud to promote awareness of the sports alongside the team and leverage their public image to help small business owners increase their product sales. Our joint initiatives embody our shared interest of the Olympic idol of excellence, respect, and friendship, helping to create a better society for all.

Speaker Change: During the second quarter of 2020 full b.

Speaker Change: Accumulated with around 415, salt and small business owners and the facilitation $14 2 billion RMB of loans to virtual Terra chips.

Speaker Change: I also want to highlight our long standing cooperation with the national weight lifting team.

Speaker Change: And the country like Hungary.

Speaker Change: Congratulate them on their rates intervene at the Pirates Olympics.

Speaker Change: We are proud to promote awareness of this.

Speaker Change: Alongside the team and the leverage their public image to help small business owners increased their product sales.

Speaker Change: Our <unk> initiatives initiatives embody our shared inquiries after the Olympics of excellence.

Speaker Change: And the friendship.

Speaker Change: Switching to create a better society for all.

Unknown Executive: We will continue to integrate ESG management throughout our business operations and partnerships, providing sustainable development across the industry.

Speaker Change: Maybe you continue to integrate ESG management throughout our business operations and the partnerships, providing such a tiny both you're very much across the industry.

Unknown Executive: Before we move on to our Seattle's review of operational and financial metrics, I'd like to share that the evolution celebrates a 17th anniversary during the second quarter. I'm also glad it inspires us to look towards our sustainable future. As such, we cite our vision for the 2021-2013. So become an international theme-type platform, connecting forwards in financial institutions across multiple global markets and leading the industry in each of them. We will remain dedicated to leveraging innovative technology to make financial service better and a greener, so fundamentally providing the solutions long-term growth. To summarize, despite China's ongoing macro challenges, we successfully deployed our leading technologies and operation capabilities to achieve solid progress in the second quarter, across the other markets in which we operate.

Tiezheng Li: And thank you for joining our earnings call.

Speaker Change: Before we move onto our where Seattle's review of operational and financial metrics I'd like to share that European evolution celebrates its 17th annual retreat during the second quarter.

Tiezheng Li: This is Tiezheng Li, CEO of FinVolution.

Tiezheng Li: We are happy to speak with you today.

Speaker Change: A milestone that inspired us to look toward our worst sustainable future.

Speaker Change: Such besides a revision for <unk> surgery.

Speaker Change: So become international Fintech platform.

Speaker Change: Connecting borrowers in the financial institutions across multiple global market.

Speaker Change: And the leading the industry in each of them.

Speaker Change: Maybe we remain dedicated to leveraging <unk> technology to make financial services by Turkey, and a greener. So it's dependent boldly preparing for evolutions long term goals.

Speaker Change: To summarize this.

Tiezheng Li: We ended the first half of 2024 on a positive note, driving progress growth in the China market while maintaining our rapid growth momentum internationally.

Speaker Change: Despite China's ongoing macro challenges, we successfully deployed our leading technology and operation capabilities to achieve solid progress in the second quarter across the outer market in which we operate going forward.

Unknown Executive: Going forward, as China's micro-environments improve, we are confident of resuming future growth and delivering consistent returns across multiple metrics for our stakeholders.

Speaker Change: China's macro environment improves we are confident of resuming parts of girls and delivering consistent returns across multiple metrics for all our stakeholders.

Unknown Executive: We decide.

Xiaoxiong Ye: I will now turn the call over to our CFO, Xiaoxiong Ye. Hope you discuss our operational and financial results in great detail.

Julia: I will now turn the call over to our CFO Julia issue.

Julia Issue: Discuss our operational and financial results in greater detail.

Julia: Yeah.

Xiaoxiong Ye: Secretary Li and the hall of everyone, let's go through our key results for the second quarter. To be mindful of the lands of our earnings court today, I encourage listeners to refer to our second quarter earnings press release for further details. Despite China's 5% GDP growth in the first half of 2024, uncertainty still persists in the macro-environment. Some more tricky items, and the tourism-related activities remain the bright spot with the main holiday. Six 18 shopping festivals and the consumption-related index all showing signs of improvement. However, China's overall retail sales low to 2% growth year-over-year in June, which did not reflect an optimal recovery trajectory.

Tiezheng Li: So determine, strong execution of our local excellence, global outlook strategy, or simply L-E-G-O, legal strategy.

Jimmy Tan: the IRR website providing details of our results for the quarter.

Julia Issue: Thank you, Andy and Hello, everyone.

Tiezheng Li: We made great strides across our business in the markets in which we operate.

Julia Issue: Let's go through our key results for the second quarter.

Jimmy Tan: I will now turn the call over to

Speaker Change: To be mindful of the length of our earnings call today.

Speaker Change: Listeners to refer to our second quarter earnings press release for further details.

Speaker Change: Despite the China is 5% of GDP growth in the first half wall for 10 to 20 full uncertainties do participate in macro environment.

Speaker Change: It's the more ticket items and tourism related activities remained the bright spot with the May holiday.

Speaker Change: 618 shopping festival and consumption related to index, all showing signs of improvement.

Speaker Change: However, China's overall retail sales rose two 2% growth year over year in June which it does not reflect an optimal recovery trajectory.

Xiaoxiong Ye: China's manufacturing PMI index remained largely stable in July, with manufacturing PMI holding steady at 49.4 points. Concurrently, the manufacturing PMI and the compensated PMI both reached 15.2 points, which is within the expansion range in the catering, Chinese, and the price-graduring production recovery. In short, also China's economy is recovery. There are still pockets of tuberous, which we will need to navigate using our vast experience and technological and operational process. As we mentioned, our performance in the first half of the year was solid, with transaction volume growth in both China and the international market landing within our guidance range.

Speaker Change: China manufacturing PMI index remained largely stable in July with manufacturing PMI holding steady added 14 nine four point.

Speaker Change: Concurrently the manufacturing PMI and compensated PMI, both reached 15 point to point.

Speaker Change: Which is within the expansion range.

Speaker Change: Indicating Chinese enterprise.

Speaker Change: Graduated production recovery.

Speaker Change: In shot.

Speaker Change: Also tried to ask what he called me. His recovery there are still pockets offered tuberous, which we will need to navigate using our loss experience and the technology and operational process.

Tiezheng Li: our CEO, Mr. Tianzhen Li.

Tiezheng Li: Cumulatively, we have served around 31.5 million borrowers across China, Indonesia and the Philippines as of June 30, 2024. During the first half of 2024, transaction volume for the China market reached 92.5 billion RMB, up 6% year-over-year.

Speaker Change: As Lee mentioned our performance in the fourth half of the year worth 40, it's with transaction volume growth in both China and the international market lending within our guidance range.

Xiaoxiong Ye: This was supported by consistent excellence across numerous as the areas such as institution-infoining, long-collection, and the risk of problems are more others. Let me work you through some of the details. During the second quarter, our average borrowing rate in China remains stable at RRA 22.2%, validating our strong commitment to advancing financial inclusion. Given financial institutions' growing desire to obtain good quality borrowers from our platform, our founding course improves significantly, shrinking another 90 beeps during the quarter and recording a cumulative improvement of 114 beeps in the first half of 2024, leading to consistent improvement in our T-grade.

Speaker Change: This was supported by consistent excellence across numerous areas such as institution, Bonnie low clutching and the rector well move more of this.

Tiezheng Li: Please go ahead, sir.

Speaker Change: Let me walk you through some of the details.

Speaker Change: Yeah.

Speaker Change: During the second quarter, However, Boehringer 18, China remained stable at 22, 2%, but if you do you all have a strong commitment to devoting my initial inclusion.

Speaker Change: Give it a financial institutions growing desire to obtain crude quality borrowers for our platform our founding cost improve significantly.

Speaker Change: Another 90 bps during the quarter and recording a cumulative improvement of 100, and the 14 bps in the first half off the floor.

Speaker Change: Leading to consistent improvement in all the take rate.

Xiaoxiong Ye: Such a huge same annual improvement in founding course and the scores by leisure institutions deep-tracking our credit risk assessment capabilities, and our growing enhancement of the quality of our borrowers. Given the quality of our borrowers and ample market liquidity, we are confident of achieving continued improvement in founding course in the second half of the year. Regarding risk management, the recovery economy and our annual adjustment to our credit risk assessment models drove progressive improvement in our day-wend inequities and rate, which failed by 10 basis points sequentially to reach 5.1% for the quarter. For our vintage perspective, we maintain our view that vintage inequities were stabilized at around 2.5%. By referring our responsive payment deduction strategy, we have enhanced the efficiency of our loan collection process, resulting in improvement in our loan collection to cover rate to 188%.

Speaker Change: Such a huge improvement in funding costs and of course by their institutions deep trial. So you are all well credit risk assessment capabilities and ongoing enhancement of the quality of our borrowers.

Given the quality of all our borrowers in the end pull market and liquidity. We are confident of achieving continued improvement in funding cost in the second half over the year.

Speaker Change: Regarding our risk management.

Speaker Change: The recovery economy.

Ed: And Oh, Ed you just meant to our credit risk assessment models, Joan Progressive improvement in all what they went delinquency rate, which fell by 10 basis points sequentially to reach five plus 1% for the quarter.

Speaker Change: For all of Vinci perspective, we maintain our view that Vinci delinquency were stabilized at around two 5%.

Speaker Change: By referring our responsive payment deduction strategy, we have enhanced the efficiency of our loan collection process, resulting in improvement in our loan collection to cover right at 288%.

Xiaoxiong Ye: Up to 200 basis points from the previous quarter. We expect this strong recovery momentum of loan collection will persist in the second half of the year. Furthermore, as we continue to optimize our operations, we have strategically adjust our business's portfolio to adapt our partners in worry requirements. For the first half of the 24th transaction volume for our international market, reached RMB 4.5 billion, up 32% year-rear to reach the upper range of our guidance. Supported by the strong global micro-environment and our effective legal strategy, we believe our international business growth momentum is sustainable with further diversification among different business models.

Speaker Change: About 200 basis points from the previous quarter.

Speaker Change: We expect this strong recovery momentum of loan collection will persist in the second half of the year.

Speaker Change: Furthermore, as we continue to optimize our operations.

Speaker Change: We have strategically adjust our business the portfolio to adapt but our partners in Huawei requirements.

Speaker Change: Yeah.

Tiezheng Li: Transaction volume for international market continued to grow rapidly, soaring to 4.5 billion RMB, up 32% year-over-year.

Speaker Change: For the first half of it all the time you said, it's more transaction volume for all way to Nashville, Lockheed reached RMB, four 5 billion up 13, 2% year over year to reach the upper range of our guidance.

Tiezheng Li: 在出色的平衡上,中國掌握了, 64.2 billion RMB, while our international market shows 1.4 billion RMB, up 3% and 27% respectively year-over-year.

Speaker Change: Supported by the strong global macro environment, and our effective legal strategy, we believe our international business girls and momentum is sustainable with further diversification among different debate isn't models.

Operator: At this time, all participants are listening only mode.

Xiaoxiong Ye: Moving on to our international expansion efforts, in the near future, our first and largest overseas market has shown continued growth in its micro-economy throughout the first half of the year, with the recorded GDP growth of 5.05% for the second quarter and the targeted GDP growth of 5.2% for full year 2021. The Indonesia Consumer Confidence Index has revamped high at about 120% for 18 months. The volume of motorbike shares increased 26% year-over-year and 17% to 599,000 as of July 2024, for data-streeting the nations. Besides a moderate correction to 49.3% in July 2004, Indonesia's manufacturing PMI has remained about 15% since September 2021, reflecting Yada's three consecutive years of sustained economic prosperity.

Operator: After management prepared remarks, there will be a question and answer session. Today's conference call is being recorded.

Speaker Change: Moving on to our international expansion efforts in the new ship, our first and the largest overseas market as she'll continue the growth in U S macro economy throughout the first half of a D. C. With a record you have the GDP growth of 510, 5% for the second quarter and a target of GDP growth all fly.

Denise Khan: I would now like to turn the call over to your host, Denise Khan, head of investor relations for the company.

Denise Khan: Denise, please go ahead.

Speaker Change: One 2% for full year.

Denise Khan: Thank you, Alison.

Speaker Change: Do you have any sheer consumer confidence index has been high.

That's about 100, and the 20% or 18 months.

Speaker Change: The volume of model bike sales increased 26% year over year and 17% distinguishing the two 519 nice solid and that's all for July trends any fool for data Street team the nation ages 18 to presume or optimism.

Denise Khan: Hello everyone and welcome to our 2nd quarter of 2024 Earnings Conference Call.

Speaker Change: Beside a moderate correction to 14 nine 3% in July tender, a new fault, Indonesia Ism manufacturing PMI has to remain above 50.

Speaker Change: 15% interest in September a tiny tiny wooden reflecting yeti three consecutive years after stand economic prosperity.

Xiaoxiong Ye: The unemployment rate decreased for the year-over-year in March 2004 to 4.8% from 5% to 0.5% in the same period the last year, further strengthening consumer's confidence. After two quarters of business adjustment towards bad quality spoilers under the new pricing cap, we are proud to share that we have stabilized our operations in Indonesia and continue to gain recommendations for local customers and other stakeholders. This recommendation has attract new founding partners, including a leading local digital bank. We are also steadily building and strengthening our relationships with larger and more reputable local financial institutions to diversify our funding sources, thereby optimizing funding costs.

Speaker Change: That doesn't mean quad mentor rates decreased for the year over year. Your March $10 four to four 8% from 5.5% in the same period of last year further guessing consumers competence.

Speaker Change: After two quarters of bid as adjustment towards better quality borrower, that's under the new pricing cap where possible to share that we have stabilized our operations in Indonesia, and they continue to get real combination for local customers and other stakeholders.

Speaker Change: These are a culmination has attract new funding partners, including a leading local what did your bank.

Speaker Change: We are also steadily building and strengthening our relationships with the larger and the more reputable local financial institutions to diversify our funding sources, thereby optimizing bonding cost.

Denise Khan: The company results were issue via news via services earlier today and are posted online. You can download the earnings release and sign up for the company email alerts by visiting the IRR section of our website.

Xiaoxiong Ye: Next, our second international market at the Philippines, as of July 2004, its manufacturing PMI has remained about 15% for 11 consecutive months. The Philippines' labor market is also exhibiting positive momentum. With an employment rate dropping to 3.1% as of June 2024, around 4.5% compared to the same period the last year, furthermore, private consumption contribution to 17.2.5% of the Philippines' nominal GDP in the second quarter of 2024, reflecting robust domestic amounts that will further support the nation's rapid economic growth. Notably, our Philippines' operation continued to all perform expectations, with the transaction volume growing 140% year-over-year and 20% quarter-quarter to R&B 600 and 74 million in the second quarter, representing 29% of the international transaction volume.

Denise Khan: This is via ira.cmbg.com.

Speaker Change: Next I'll stick in the international market to the Philippines.

Denise Khan: Mr. Thiagen Lee, our Chief Executive Officer and Mr. Di Ren Shui, our Chief Financial Officer, will start the call with their preparing remarks and conclude with a Q&A session.

Speaker Change: That's all for July to no new for its manufacturing PMI has remained above 15% for 11 consecutive months.

Speaker Change: Would it be just the labor market is also exhibiting positive momentum.

Speaker Change: With the unemployment rates dropping to three 1% as of June 30, 94 for around four 5% compared to the same period last year.

Speaker Change: For the Mol Bravo to cause I'm pushing consumption contributes to 17, two 5% of the Philippines nominal GDP in the second quarter of 274, reflecting robust domestic demand letter will further support to the nation's rapidly you cannot make a girls.

Unknown Executive: Cumulatively, we have served around 31.5 million borrowers across China, Indonesia and the Philippines as of June 30, 2024. During the first half of 2024, transaction volume for the China market reached 92.5 billion RMB of 6% year over year. In terms of outstanding violence, China reached 64.2 billion RMB while our international markets rose to 1.4 billion RMB of 3% and 27% respectively year over year.

Speaker Change: Notably, our Philippines operation continued to outperform expectations with transaction volume growing 100, and a 14% year over year and 20% quarter over quarter to RMB 617, 4 million if they stick in the courtroom rubber.

Speaker Change: <unk> 29 per say and all of the international transaction volume.

Xiaoxiong Ye: These outstanding performance reflects joint support from our local partners such as C-Bank, Union Bank, and Maya Bank. Our latest founding partners, who recently partnered with us on a US 47-minute program. With sufficient funding in place, we believe we can maximize the benefits of our e-commerce cooperation with T-Toc Shop, acquire additional new borrowers from diversified channels, and sustain continued high growth rates.

Speaker Change: This outstanding performance reflects strong support from our local partners such as Sea Bank Union Bank and buy a bank our latest our funding partners, who recently Potter with us.

Unknown Executive: This standard performance stands out as a testament to the effective execution of our legal strategy and the unveiling commitment of our team. Customer acquisition is a key element of our legal strategy. We view it as an ongoing investment that will ultimately lead to a higher percentage of vital quality, repeat borrowers and drive sustainable girls. During the second quarter, our number of total new borrowers reached 8.2 billion and 23.2 billion, up 22% year over year and 15% sequentially.

Speaker Change: <unk> 14 7 million program.

Speaker Change: Where is it sufficient to funding in place. We believe we can maximize the benefits of our e-commerce cooperation with teeth tuck shop.

Speaker Change: Additional new borrowers from diversified channels and stem continued high growth rates.

Tiezheng Li: Thanks, Jimmy.

Speaker Change: Okay.

Xiaoxiong Ye: Now, turning into our financial metrics. These quarters, operation no excellence needed to be expected to financial results. Natural revenue for the quarter reached R&B 3.17 billion, up 3% year-over-year. Our net income was R&B 5.51 million, a 4% increase quarter-over-quarter. Meanwhile, sales and marketing expenses increase by 5% sequentially to M-B-400 and the 17-3 minutes as we continue to invest in growth across all of our markets. As we restructed our business mix, our lab duration adjusted to 2.3.5 times, indicating opportunities for tremendous growth when the economy further recovers. Our battery sheet remained robust, with short-term liquidity maintaining a scarcity level at R&B 8.1 billion, reflecting our strengths and flexibility in executing our legal strategy to advance our international expansion and the drive shareholder's return.

Speaker Change: Now turning to our financial metrics.

Tiezheng Li: Hello, everyone, and thank you for joining our earnings call.

Speaker Change: This quarter's operational excellence needed to better than expected financial results.

Tiezheng Li: This is Tianzhen Li, CEO of Involution Group.

Speaker Change: Net revenue for the quarter, Richard I'm, sorry, Paul.

Paul: One 7 billion up 3% year over year, our net income was I'm be five country and 51 million.

Tiezheng Li: We are happy to speak with you today.

Unknown Executive: While updating our ability to grow our business across different countries, notably as we completed the transition to better quality borrowers in Indonesia and began to diversify our business model. The percentage of new international borrowers once again surpassed the percentage of new China borrowers. Furthermore, our number of new borrowers in the Philippines continue to grow robustly in the second quarter, increasing by one hand root in the 98% year over year and the sixth, 69% sequentially.

Paul: 4% increase quarter over quarter.

Cory: Cory I'll operation is stability.

Speaker Change: Meanwhile, sales and marketing expenses increased to five 5% sequentially I'm before country into 17 3 million, although we continue to invest in growth across all of our market.

Speaker Change: Although we restricted our business mix, our Labrador ratio at your attitude to three five times, indicating opportunities for tree madis girls to when the economy further recovers.

Speaker Change: Our balance sheet remains robust with short term liquidity, maintaining a healthy level at RMB, eight 1 billion, reflecting almost dress and the flexibility in executing our legal strategy to advance all of our international expansion and to drive shareholder return.

Unknown Executive: Our effective social media strategy in the international markets also continue to yield positive outcomes. As of the end of the second quarter, our followers on leading social media platforms such as Facebook, TikTok and Instagram had risen to approximately 1.3 million, 850 solid and 240 solid, up 41% 30% and 8% year over year respectively. While updating the strong brand awareness of deep localization, we have created market.

Xiaoxiong Ye: Consisting a rewarding our shareholder's to remain a top priority for revolution, both through being as growth across different markets and our market-leading capital return program in cooperating share repurchase and dividends. Our first share repurchase program began in March 2018, shortly after our IPO in November 2017, and has been widely embraced by our shareholders. Our buyback history indicates two repurchase programs with a total deployment of around US$ 216 million. We are now conducting our third repurchase program of up to US 115 million. Notably, in the second quarter, we deployed around US 13 million and the repurchased 6.1 million ADS.

Speaker Change: Consistent a rewarding our shareholders through a mouth Talbot poverty fourth evolution.

Speaker Change: Through business goals across different market and our market, leading capital return program incorporating share repurchase and the dividends.

Speaker Change: Our first share repurchase program began in March of 2018 sheltered alcohol. Shortly after our IPO in November 2017, and has been widely in breadth by all of our shareholders.

Unknown Executive: As a theme-type leader, technology is deeply engraved in our DNA. It remains the core of our business and our primary competitive age during the second quarter. We halted an internal-type competition called Haixong, bringing together six R&D teams for a 36-hour session in a color-style environment. Vinyu project included admin AI bots, which can incorporate API function calls into larger language models. Its framework can also be expanded to include multiple internal tools and support the management of different tools across platforms. Another standard e-sound, leverage AADC to utilize fragmented time slots to increase productivity. We believe this project demonstrates great implementation potential for enhancing our operations and overall efficiency.

Speaker Change: Oh, well buyback history indicates two approaches programs with our total deployment of around U S.

Speaker Change: 260 million, we're now conducting hours further repurchase program of up to USD 150 million.

Speaker Change: Notably in the second quarter, we deployed around the U S 30 minutes and the repurchased six 1 million a D S.

Tiezheng Li: We ended the first half of 2024 on a positive note, driving progress growth in the China market while maintaining our rapid growth momentum internationally.

Xiaoxiong Ye: For the first half of 2004, we have deployed around US 15-7 million for share repurchase. Our total cumulative share repurchase amount reached US$ 3.37 million as of the end of the second quarter. In addition, our dividends has steadily increased over the past four years, with the cumulative dividend amount reaching US 3.25 million in total. Our capital return program has returned US $612 million to our shareholders, with a pay-out ratio rising to 49% of net profit in 2023. Going forward, we will continue to strengthen our capital return program for our shareholders.

Speaker Change: For the first half off of a tender neutral we have deployed a rule in the U S 15, 7 million will share repurchase our.

Speaker Change: Our total accumulated with share repurchase amount to reach the U S through your country and there's 13 7 million.

Speaker Change: As of the end of the second quarter.

Speaker Change: Yeah Dishing, our dividends has steadily increased over the past four years with the accumulated dividend amounting to reaching U S 325 million.

Speaker Change: In total our capital return program has returned to the U S 600, and the 16 2 million to our shareholders with a payout ratio rising to 14, 9% of net profit in 2023.

Unknown Executive: Next, I'd like to share some updates on our ESG progress. We recently published our 2023 ESG report, the six in our company's history, highlighting our dedication to transparency and sustainability. In 2023, we launched our mission of leveraging innovative technologies to make financial service better, as well as our ESG strategy centered on technology, green principle, and candidates. In addition to giving back to society with innovative technologies, the evolution and precise integrity and compliance, low carbon development, and harmonies relationships with employees, partners, and communities in its ESG management efforts.

Speaker Change: Going forward, we will continue to strengthen our capital return program for our shareholders.

Tiezheng Li: Sir determined strong execution of our local excellence global outlook strategy, or simply L-E-G-O, legal strategy.

Xiaoxiong Ye: In summary, our second quarter results showcase our legal strategy's effectiveness. Our nameable business model and our technological advantages. We expect our Indonesia operations to become profitable in 2024 and our Philippines' operations to contribute to profits in 2025. Both in our confidence in deploying a more proactive international expansion strategy. As we capitalized on the massive opportunities in the international markets, we look forward to delivering sustainable growth and the sharing of our success with all our stakeholders. That concludes my prepared remarks.

Tiezheng Li: We made great strides across our business in the markets in which we operate.

Tiezheng Li: This stellar performance stands out as a testament to the effective execution of our legal strategy and the unwavering commitment of our team.

Speaker Change: In summary, our solid second quarter results showcase our legal strategies effectiveness.

Tiezheng Li: Customer acquisition is a key element of our legal strategy. We view it as an ongoing investment that will ultimately lead to a higher percentage of better quality repeat borrowers and drive sustainable growth.

Tiezheng Li: During the second quarter, our number of total new borrowers reached 823,000, up 22% year-over-year and 15% year-over-year.

Speaker Change: Our naval business model and all of our technology core advantages.

Speaker Change: We expect our Indonesia operations to become profitable in 2024, and our Philippines operation to be contribute to profits in country refi boom.

Speaker Change: Boosting our confidence in the pouring a more proactive international expansion strategy.

Tiezheng Li: Cumulatively, we have served around 31.5 million borrowers across China, Indonesia, and the Philippines as of June 30, 2024. During the first half of 2024, transaction volume for the China market reached 92.5 billion RMB, up 6% year-over-year.

Speaker Change: As we capitalize on the massive opportunities in the international market, we look forward to delivering sustainable growth in the shadow of our success with all our stakeholders.

Tiezheng Li: Transaction volume for international market continued to grow rapidly, soaring to 4.5 billion RMB, up 32% year-over-year.

Tiezheng Li: Customers' acquisition is a key element of our legal strategy. We view it as an ongoing investment that will ultimately lead to a higher percentage of better quality repeat borrowers and drive sustainable growth.

Tiezheng Li: During the second quarter, our number of total new borrowers reached 823,000, up 22% year-over-year and 15% sequentially, validating our ability to grow our business across different countries, notably as we completed the transition to better quality borrowers in Indonesia and began to diversify our business model.

Unknown Executive: Moreover, we continue to spot small business owners through the second quarter's challenges. During the second quarter of 2023, we accumulated with several around 415,000 small business owners and facilitated 14.2 billion RMB of loans to neutral their dreams. I also want to highlight our long-standing cooperation with the national weightlifting team, and congratulate them on their recent wins at the Paris Olympics. We are proud to promote awareness of the sports alongside the team and leverage their public image to help small business owners increase their product sales.

Speaker Change: That concludes my prepared remarks, we will now open the call to questions. Operator. Please continue.

Unknown Executive: We will now open the corner to the questions. Operators, we just continue. Thank you. We will now begin the question and answer session. To ask a question, you may press star, then one on your touch time sign. If you are using a speaker phone, please pick up your handset before pressing the key. If at any time your question has been addressed and you would like to make for all your questions, please press star then two. For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, we ask that you please kindly repeat your question in English.

Tiezheng Li: The percentage of new international borrowers once again surpassed the percentage of new China borrowers.

Tiezheng Li: 謝謝收看, validating our ability to grow our business across different countries.

Speaker Change: Thank you.

Tiezheng Li: Notably, as we completed the transition to better quality borrowers in Indonesia and began to diversify our business model.

Speaker Change: We will now begin the question and answer session.

Speaker Change: I'll ask a question you May press Star then one on your touch Tencent.

Speaker Change: If you are using a speaker please pick up your handset before pressing the keys.

Speaker Change: If at any time your question has been addressed.

Speaker Change: And you would like to thank you for all your question. Please press Star then two.

Speaker Change: For the benefit of all participants on today's call. If you wish to ask your question to management in Chinese we ask that you. Please kindly repeat your question in English.

Unknown Executive: At this time, we will pause for a moment to assemble our roster.

Unknown Executive: Our joint initiatives embody our shared interest of the Olympic idol of excellence, respect, and friendship, helping to create a better society for all. We will continue to integrate ESG management throughout our business operations and partnerships, providing sustainable development across the industry.

Tiezheng Li: The percentage of new international borrowers once again surpassed the percentage of new China borrowers.

Tiezheng Li: Furthermore, our number of new borrowers in the Philippines continued to grow robustly in the second quarter, increasing by 198% year-over-year and 69% sequentially.

Speaker Change: At this time people pause for a moment to assemble our roster.

Tiezheng Li: Furthermore, our number of new borrowers in the Philippines continues to grow robustly in the second quarter, increasing by 198% year-over-year and 69% sequential.

Tiezheng Li: Our effective social media strategy in the international market also continues to yield positive outcomes. As of the end of the second quarter, our followers on leading social media platforms such as Facebook, TikTok, and Instagram had risen to approximately 1.3 million, 850,000, and 240,000, up 41%, 30%, and 8% year-over-year respectively, validating the strong brand awareness of deep localization we have created in our overseas market.

Tiezheng Li: As a fintech leader, technology is deeply engraved in our DNA.

Speaker Change: Okay.

Cindy Wong: Our first question today will come from Cindy Wong of China Renaissance.

Tiezheng Li: Our effective social media strategy in the international market also continued to yield positive outcomes. As of the end of the second quarter, our followers on leading social media platforms such as Facebook, TikTok and Instagram had risen to approximately 1.3 million, 850,000 and 240,000, up 41%, 30% and 8% year-over-year respectively, validating the strong brand awareness of deep localization we have created in our overseas markets.

Speaker Change: Our first question today will come from Cindy Wang.

Tiezheng Li: It remains at the core of our business and our primary competitive edge, during the second quarter.

Speaker Change: That's China Renaissance. Please go ahead.

Cindy Wong: Please go ahead. The second question today will come from Cindy Wong of China Renaissance.

Tiezheng Li: As a fintech leader, technology is deeply ingrained in our DNA. It remains at the core of our business and our primary competitive edge. During the second quarter, we hosted an internal tech competition called Hexa, bringing together 60 R&D teams for a 36-hour session in a closed-door environment.

Tiezheng Li: Another standout is Sound, leveraging AIGC to utilize fragmented time slots to increase productivity.

Tiezheng Li: We believe this project demonstrates great implementation potential for enhancing our operations and overall efficiency.

Tiezheng Li: Next, I'd like to share some updates on our ESG progress. We recently published our 2023 ESG report, the 6th in our company's history, highlighting, our dedication to transparency and sustainability. In 2023, we advanced our mission of leveraging innovative technologies to make financial, service better, as well as our ESG strategy centered on technology, green principles, and kindness.

Cindy Wang: Oh, how bad she got questions I'll give.

Tiezheng Li: In addition to giving back to society with innovative technologies, FinVolution emphasizes, integrity and compliance, low-carbon development, and harmonious relationships with employees, partners, and communities in its ESG management efforts.

Tiezheng Li: Moreover, we continue to support small business owners through the second quarter's challenges. During the second quarter of 2024, we cumulatively served around 415,000 small business owners, and facilitated 14.2 billion RMB of loans to nurture their dreams.

Tiezheng Li: I also want to highlight our longstanding cooperation with the national weightlifting, team and congratulate them on their recent wins at the Paris Olympics.

Speaker Change: No it's okay.

Unknown Executive: Before we move on to our Seattle's review of operational and financial metrics, I'd like to share that the evolution celebrates a 17th anniversary during the second quarter. I'm also glad it inspires us to look towards our sustainable future. As such, we cite our vision for the 2021-2013. So become an international theme-type platform, connecting forwards in financial institutions across multiple global markets and leading the industry in each of them. We will remain dedicated to leveraging innovative technology to make financial service better and a greener, so fundamentally providing the solutions long-term growth.

Tiezheng Li: We are proud to promote awareness of the sport alongside the team and leverage their public, image to help small business owners increase their product sales.

Speaker Change: One day, you don't want to you know classic Umpqua.

Tiezheng Li: Our joint initiatives embody our shared interest of the Olympic value of excellence, respect, and friendship, helping to create a better society for all.

Tiezheng Li: We will continue to integrate ESG management throughout our business operations and partnerships, propelling sustainable development across the industry.

Tiezheng Li: Before we move on to our CFO's review of operational and financial metrics, I'd like, to share that FinVolution celebrates its 17th anniversary during the second quarter, a milestone that inspires us to look towards our sustainable future.

Tiezheng Li: As such, we set our vision for 2030 to become an international FinTech platform, connecting, borrowers and financial institutions across multiple global markets, and leading the industry in each of them.

Tiezheng Li: We will remain dedicated to leveraging innovative technology to make financial services better, and greener, sustainably propelling FinVolution's long-term growth.

Speaker Change: No two vouchering and shipped them to be and there you go.

Speaker Change: Didn't hit API.

Speaker Change: <unk> now show in Shanghai at kind of what you mentioned that you go what could be the truly issue to Macondo downhaul humira negotiation, they're going to change is going to be timberland to API to these bigger yacht show that.

Speaker Change: Your meal.

Speaker Change: In July <unk>.

Tiezheng Li: We hosted an internal-type competition called Hexagons, bringing together 60 R&D teams for a 36-hour session in a closed-door environment.

Speaker Change: Thank you management for taking my call and I have two questions. Here first question is could you give us some color on the <unk>.

Unknown Executive: To summarize, despite China's ongoing macro challenges, we successfully deployed our leading technologies and operation capabilities to achieve solid progress in the second quarter, across the other markets in which we operate. Going forward, as China's micro-environments improve, we are confident of resuming future growth and delivering consistent returns across multiple metrics for our stake holders.

Tiezheng Li: Winion Projects Included Admin AI Bot, which can incorporate API function calls into a large language model. Its framework can also be expanded to include multiple internal tools, and support the management of different tools across platforms.

Tiezheng Li: Another standout, ESound, leverages AIGC to utilize fragmented time slots to increase productivity.

Tiezheng Li: We believe this project demonstrates great implementation potential for enhancing our operations and overall efficiency.

Tiezheng Li: Next, I'd like to share some updates on our ESG program. We recently published our 2023 ESG report, the sixth in our company's history, highlighting our dedication to transparency and sustainability.

Tiezheng Li: In 2023, we advanced our mission of leveraging innovative technologies to make financial service better, as well as our ESG strategy centered on technology, green principle, and candidates, in addition to giving back to society with innovative technology.

Tiezheng Li: FinVolution emphasizes integrity and compliance, low-carbon development, and harmonious relationships with employees, partners, and communities in its ESG management efforts.

Tiezheng Li: Moreover, we continue to support small business owners through the Second Quarters Challenge.

Tiezheng Li: During the second quarter of 2024, we accumulated and served around 415,000 small business owners and facilitated 14.2 billion RMB of loans to neutralize their dreams.

Tiezheng Li: I also want to highlight our longstanding cooperation with the National Weightlifting Team, and congratulate them on their recent wins at the Paris Olympics.

Speaker Change: <unk> of your China borrowers loan demand in second quarter and also.

Tiezheng Li: We are proud to promote awareness of the support alongside the team and leverage their public image to help small business owners increase their product sales.

Tiezheng Li: Our joint initiatives embody our shared interest of the Olympic value of excellence, respect and friendship, helping to create a better society for all.

Tiezheng Li: We will continue to integrate ESG management throughout our business operations and partnerships, providing sustainable development across the industry.

Tiezheng Li: Before we move on to our CFO's review of operational and financial metrics.

Tiezheng Li: I'd like to share that FinVolution celebrates its 17th anniversary during the second quarter.

Tiezheng Li: A milestone that inspires us to look toward our sustainable future.

Tiezheng Li: As such, we set our vision for 2030, to become an international fintech platform connecting borrowers in the financial institutions across multiple global markets, and leading the industry in each of them.

Speaker Change: In July and the second question is the Indonesia.

Tiezheng Li: We will remain dedicated to leveraging innovative technology to make financial services better and greener, sustainably propelling FinVolution's long-term.

Tiezheng Li: 總結一下, Despite China's ongoing macro challenges, we successfully deployed our leading technologies and operations capabilities to achieve solid progress in the second quarter across all the markets in which we operate.

Tiezheng Li: As China's microenvironment improves, we are confident of resuming fast growth and delivering consistent returns across multiple metrics for all our stakeholders.

Tiezheng Li: With that, I will now turn the call over to our CFO, Jiayuan Xu, who will discuss our operational and financial results in great detail.

Speaker Change: Your customer acquisition strategy after the APR meet the requirement and any update on the regulation front of the interest rate requirement in 2025. Thank you.

Unknown Executive: We decide.

Denise Khan: During this call, we will be referring to several non-gap financial measures to review and assess our operating performance. These non-gap financial measures are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with US gap. For information about these non-gap measures and reconciliation to gap measures, please refer to our earnings press release.

Xiaoxiong Ye: I will now turn the call over to our CFO, Xiaoxiong Ye. Hope you discuss our operational and financial results in great detail.

Jiayuan Xu: Thank you Li and hello everyone, Let's go through our key results for the second quarter.

Jiayuan Xu: To be mindful of the length of our earnings call today, I encourage listeners to refer to our second quarter earnings press release for further details.

Thank you.

Speaker Change: If you go into the whole Doug would you show me a little help with Azure.

Jiayuan Xu: Despite China's 5% GDP growth in the first half of 2024, uncertainty still persists in the macro environment.

Jiayuan Xu: Small tiki items and tourism-related activities remained the bright spot with the May holiday.

Joseph: Ooh Joseph.

Denise Khan: Before we continue, please note that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S.

Xiaoxiong Ye: Secretary Li and the hall of everyone, let's go through our key results for the second quarter. To be mindful of the lands of our earnings court today, I encourage listeners to refer to our second quarter earnings press release for further details. Despite China's 5% GDP growth in the first half of 2024, uncertainty still persists in macro-environment. Some more tricky items and the tourism-related activities remain the bright sport with the main holiday.

Speaker Change: <unk>.

Denise Khan: Private Security Certification Reform Act of 1995.

Speaker Change: As usual.

Speaker Change: You guys were to do a whole, Colorado suits related to you guys All hospital.

Denise Khan: Forward-looking statements involve inherent reach and uncertainties. As such, the company results may be materially different from the views expressed today.

Speaker Change: Yeah.

Speaker Change: <unk> a fiduciary duty.

Archie: Archie to NIM.

Archie: Cobalt visual will all CDR agenda editorial liana touches one who told me she's asking.

Cindy Wong: The third question today will come from Cindy Wong of China Renaissance.

Archie: Doug This is Dave <unk>.

Archie: There's obviously the other machines you know hazard ratio.

Doug: The whole dollar shui whole will move pushing quite hard on the tourist would you just use away Doug.

Jiayuan Xu: 618 Shopping Festival and Consumption-Related Index all showing signs of improvement.

Jiayuan Xu: However, China's overall retail sales slowed to 2% gross year-over-year in June, which does not reflect an optimal recovery trajectory.

Jiayuan Xu: China's manufacturing PMI index remained largely stable in July with manufacturing PMI holding steady at 49.4 points.

Jiayuan Xu: Concurrently, the manufacturing PMI and the compensated PMI both reached 15.2 points, which is within the expansion range.

Xiaoxiong Ye: Six 18 shopping festivals and the consumption-related index all showing signs of improvement. However, China's overall retail sales low to 2% growth year-over-year in June, which did not reflect an optimal recovery trajectory. China's manufacturing PMI index remained largely stable in July with manufacturing PMI holding steady at 49.4 points. Concurrently, the manufacturing PMI and the compensated PMI both reached 15.2 points, which is within the expansion range in the catering, Chinese, and the price-graduring production recovery.

Doug: Doug a bathroom delude our balance sheet.

Speaker Change: You're good with hoist with yourselves.

Speaker Change: So you sold but I cant know Magellan Visionchina Hum.

Jiayuan Xu: Indicating Chinese Enterprise Gradually Production Recovery, In short, Although China's economy is recovering, there are still pockets of turbulence, which we will need to navigate using our vast experience in the technological and operational process.

I should say to go that you wish you towards your answer to jewelry retail shelf, we don't do so you'd say surgical horrified didn't resolve Pew Liberty you wash out now how should we view this acquisition.

Speaker Change: So you will see each other and you took before them, though when you're eating into the irrigation.

Unknown Executive: Hello, Cindy, let me do the translation. Regarding China demand during the second quarter, the trend of global borrowers' demand is largely in line with the witness in residential credit demand. The daily application rate of repeat borrowers declined by a mid-single digit, around 6%, on an annual basis and quarterly comparison, reflecting with consumer confidence in July and August.

Jiayuan Xu: As Li mentioned, our performance in the first half of the year was solid, with transaction volume growth in both China and the international markets landing within our guidance range. This was supported by consistent excellence across numerous other areas, such as institutional funding, loan collection, and risk performance, among others. Let me walk you through some of the details.

Speaker Change: Hello can you let me do the translation.

Jiayuan Xu: During the second quarter, our average borrowing rate in China remained stable at IRR 22.2%, validating our strong commitment to advancing financial inclusion.

Jiayuan Xu: Given financial institutions' growing desire to obtain good quality borrowers for our platform, our funding cost improved significantly, shrinking another 90 bps during the quarter and recording a cumulative improvement of 114 bps in the first half of 2024, leading to consistent improvement in our t-grid. Such a huge semi-annual improvement in funding cost underscores financial institutions' deep trust in our credit risk assessment capabilities and our ongoing enhancement of the quality of our borrowers. Given the quality of our borrowers and ample market liquidity, we are confident of achieving continued improvement in funding costs in the second half of the year.

Speaker Change: Regarding China demand during the second quarter the trend of our borrowers demand is largely in line with the weakness in residential credit demand.

Jiayuan Xu: Regarding risk measurement, The recovery economy and our agile adjustment to our credit risk assessment models show progressive improvement in our day-one delinquency rate, which fell by 10 basis points sequentially to reach 5.1% for the quarter.

Jiayuan Xu: From a vintage perspective, we maintain our view that vintage delinquency will stabilize at around 2.5%. By referring our Responsive Payment Deduction Strategy, we have enhanced the efficiency of our loan collection process, resulting in an improvement in our loan collection recovery rate to 88%, up to 100 basic points from the previous quotation.

Jiayuan Xu: We expect this strong recovery momentum of loan collection will persist in the second half of the year.

Jiayuan Xu: Furthermore, as we continue to optimize our operations.

Jiayuan Xu: We have strategically adjusted our business portfolio to adapt our partners' involvement requirements.

Jiayuan Xu: For the first half of 2034, transaction volume for our international market reached RMB4.5 billion, up 32% year-over-year to reach the upper range of our guidance. Supported by the strong global micro-environment and our effective legal strategy, we believe our international business growth momentum is sustainable with further diversification among different business models.

Speaker Change: Daily of Patricia a particular rate of repeat borrowers declined by around.

Speaker Change: Around 6% on an annual basis and quarterly comparison, reflecting weak consumer confidence in July and August we have observed a particular risk of a repeat borrowers has increased by mid single digit between 6% to 7%.

Xiaoxiong Ye: In short, also China's economy is recovery. There are still pockets of tuberous, which we will need to navigate using our vast experience and technological and operational process.

Unknown Executive: We have observed that the application rate of our repeat borrowers has increased by mid-single digit between 6% to 7% on a daily basis. The demand of our borrowers is concentrated in the area of daily necessity.

Speaker Change: On a daily basis, the demand of our borrowers is concentrated in the area of daily necessity. Therefore.

Unknown Executive: Therefore, when the economy is weak, it will show more resilience, and we expect demand will gradually improve in the second half of the year.

Speaker Change: Therefore, when the economy is weak.

Denise Khan: For the information regarding these and other reach and uncertainties are included in the company's followings with the US Securities and Exchange Commission.

Xiaoxiong Ye: As we mentioned, our performance in the first half of the year were solid with transaction volume growth in both China and the international market's landing within our guidance range. This was supported by consistent excellence across numerous as the areas such as institution-infoining, long-collection, and the risk of problems are more others. Let me work you through some of the details. During the second quarter, our average borrowing rate in China remains stable at RRA 22.2%, validating our strong commitment to advancing financial inclusion.

Mark: Sure Mark.

Mark: And we expect demand will gradually improve in the second half of the year.

Unknown Executive: Hi, Cindy. Regarding your situation, let me do a quick answer to your question. From the perspective of Hong Kong, we have seen your overall view of Hong Kong; we think it is a little bit more ideal. After the election, the political environment is relatively stable.

Jiayuan Xu: Moving on to our international expansion efforts. Indonesia, our first and the largest overseas market, has shown continued growth in its macroeconomy throughout the first half of this year, with a recorded GDP growth of 5.05% for the second quarter and a targeted GDP growth of 5.2% for full year 2024. The Indonesia Consumer Confidence Index has remained high.

Cindy Wang: Hi, Cindy.

Cindy Wang: Go ahead <unk>.

Denise Khan: The company does not assume any application to update any forward-looking statements except as required under a pick of a law.

Collyn: And Collyn I toy shops, they hold particular radar.

Speaker Change: It's a whole bunch on me on Macondo.

Speaker Change: You need a donkey once you can call them again, they should be at each other.

Speaker Change: Touch on for a whole new opportunity for sure.

Denise Khan: Finally, we pose a slight presentation on our higher-repside providing details of our results for the quarter.

Speaker Change: Under the overdue.

Speaker Change: I will handle the GDP.

Thiagen Lee: I will now turn the call over to our CEO, Mr. Thiagen Lee.

Speaker Change: Jimmy shelf shelf as you are thinking for sure PMI sure.

Toshi: Truth Toshi.

Toshi: Oh sure so I'll do it at all in China.

Toshi: Jill I know quite well that you need.

Toshi: Yeah.

Thiagen Lee: Please go ahead, sir.

Xiaoxiong Ye: Given financial institutions growing desire to obtain good quality borrowers from our platform, our founding course improves significantly, shrinking another 90 beeps during the quarter and recording a cumulative improvement of 114 beeps in the first half of 2024, leading to consistent improvement in our T-grade. Such a huge same annual improvement in founding course and the scores by leisure institutions deep-tracking our credit risk assessment capabilities, and our growing enhancement of the quality of our borrowers.

Toshi: Argued to all of them.

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Thiagen Lee: Thanks, Jimmy.

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Xiaoxiong Ye: Given the quality of our borrowers and ample market liquidity, we are confident of achieving continued improvement in founding course in the second half of the year. Regarding risk management, the recovery economy and our annual adjustment to our credit risk assessment models drove progressive improvement in our day-wend inequities and rate, which failed by 10 basis points sequentially to reach 5.1% for the quarter. For our vintage perspective, we maintain our view that vintage inequities were stabilized at around 2.5%, by referring our responsive payment deduction strategy, we have enhanced the efficiency of our loan collection process, resulting in improvement in our loan collection to cover rate to 188%.

Thiagen Lee: Hello, everyone.

Speaker Change #103: Paul.

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Tim Watson: Tim Watson for Ultrashape.

Thiagen Lee: And thank you for joining our earnings call.

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Xiaoxiong Ye: Up to 200 basis points from the previous quarter. We expect this strong recovery momentum of loan collection will persist in the second half of the year. Furthermore, as we continue to optimize our operations, we have strategically adjust our business's portfolio to adapt our partners in worry requirements.

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Xiaoxiong Ye: For the first half of the 24th transaction volume for our international market, reached RMB 4.5 billion, up 32% year-rear to reach the upper range of our guidance. Supported by the strong global micro-environment and our effective legal strategy, we believe our international business growth momentum is sustainable with further diversification among different business models.

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Xiaoxiong Ye: Moving on to our international expansion efforts, in the near future, our first and largest overseas market has shown continued growth in its micro-economy throughout the first half of the year, with the recorded GDP growth of 5.05% for the second quarter and the targeted GDP growth of 5.2% for full year 2021. The Indonesia Consumer Confidence Index has revamped high at about 120% for 18 months. The volume of motorbike shares increased 26% year-over-year and 17% to 599,000 as of July 2024, for data-streeting the nations, Besides a moderate correction to 49.3% in July 2004, Indonesia's manufacturing PMI has remained about 15% since September 2021, reflecting Yada's three consecutive years of sustained economic prosperity.

Speaker Change #118: I'm not sure as you know.

But do you bring it up.

Speaker Change #118: Hello, Cindy let me do the translation.

Unknown Executive: From the International Marketing Department, it is presenting a much more positive trend. After the Indonesia election, the political situation has normalized with an improving economy, such as GDP increase. And let us concentrate on the power performance in Indonesia. During the second quarter, transaction volume for Indonesia market reach 1.64 billion after about 6 to 7% annually, without standing loan balance between 1.0 billion, up about 4%. Revenue for the quarter reach 430 million. Number of borrowers reach 530,000, up 4% sequentially, and number of new borrowers reach 200,000, up 9% sequentially. We have cumulatively cooperated with 7 financial institutions, and all our fundings is from local financial institutions now.

Tiezheng Li: To summarize, despite China's ongoing macro challenges, we successfully deployed our leading, technologies and operation capabilities to achieve solid progress in the second quarter across all the markets in which we operate.

Speaker Change #119: From the international macro environment is presenting a much more positive trend.

Jiayuan Xu: 在18個月內達到120%的收入, The volume of motorbike sales increased 26% year-over-year and 17% sequentially to 599,000 as of July 2024, further illustrating the nation's heightened consumer optimism.

Jiayuan Xu: Beside a moderate correction to 49.3% in July 2024, Indonesia's manufacturing PMI has remained above, 15% since September 2021, reflecting nearly three consecutive years of sustained economic prosperity.

Speaker Change #120: You can do in Israel election, right political situations has normalized with an improving economy, such as GDP increase and.

Jiayuan Xu: The unemployment rate decreased for the year-over-year in March 2024 to 4.8% from 5.5% in the same period last year, further strengthening consumers' confidence.

Jiayuan Xu: After two quarters of business adjustment towards better quality spoilers under the new pricing cap, we are proud to share that we have stabilized our operations in Indonesia and continue to gain recognition from local customers and other stakeholders. This recognition has attracted new funding partners, including a leading local digital bank.

Speaker Change #121: And let us concentrate on our performance in Indonesia during the second quarter transaction volume for Indonesia market week, 164 billion up about 6% to 7% annually with outstanding loan balance between 1.0 billion up about 4% revenue for the quarter reached $430 million.

Speaker Change #122: Number of ballroom with reach.

Speaker Change #122: 530000 up 4% sequentially, a number of new borrowers reach.

Speaker Change #122: 200000 up 9% sequentially, we have cumulatively cooperated with seven financial institutions and all were fundings is from local financial institutions now.

Jiayuan Xu: We are also steadily building and strengthening our relationships with larger and more reputable local financial institutions to diversify our funding sources, thereby optimizing funding costs.

Jiayuan Xu: Next, our second international market, the Philippines.

Jiayuan Xu: As of July 2004, its manufacturing PMI has remained above 15% for 11 consecutive months.

Jiayuan Xu: The Philippines labor market is also exhibiting positive momentum, with the unemployment rate dropping to 3.1% as of June 2024 from 4.5% compared to the same period last year.

Jiayuan Xu: Furthermore, private consumption contributed 72.5% of the Philippines' nominal GDP in the second quarter of 2024, reflecting robust domestic demand that will further support the nation's rapid economic growth.

Jiayuan Xu: Notably, our Philippines operation continues to outperform expectations, with transaction volume growing 140% year-over-year and 20% quarter-over-quarter, to RMB674 million in the second quarter, representing 29% of the international transaction volume.

Jiayuan Xu: This outstanding performance reflects strong support from our local partners such as C-Bank, Union Bank, and Myer Bank, our latest founding partners who recently partnered with us on a U.S. $47 million program.

Xiaoxiong Ye: The unemployment rate decreased for the year-over-year in March 2004 to 4.8% from 5% to 0.5% in the same period the last year, further strengthening consumer's confidence. After two quarters of business adjustment towards bad quality spoilers under the new pricing cap, we are proud to share that we have stabilized our operations in Indonesia and continue to gain recommendation for local customers and other stakeholders. This recommendation has attract new founding partners, including a leading local digital bank. We are also steadily building and strengthening our relationships with larger and more reputable local financial institutions to diversify our founding sources, thereby optimizing founding costs.

Unknown Executive: Our Indonesian operations has completed its driving transition in just 5 months, and we have made adjustment in borrowers' cohorts, modest iteration, and credit risk has improved by 28%, meaningfully offsetting the impact of interest reduction. Therefore, our take rate returned to 10%, reflecting our business entering a more stable state. For the third quarter, in the second half of the year and for the third quarter, we expect Indonesia operations will resume group of over 10%. With transaction volume potentially reaching new record high, Indonesia online operations will remain stable with credit risk, customer acquisitions, improving consistently for offline operations.

Speaker Change #122: Our Indonesia operations has competitive pricing transition in just five months and we have made adjustments embargoes.

Speaker Change #122: Modest iteration and credit Suisse has improved by 28% meaningfully.

Speaker Change #122: Offsetting the impact of interest rate reduction.

Speaker Change #122: Our take rate return to 10%.

Speaker Change #122: Reflecting our business entering a more stable.

Speaker Change #122: Yes.

Jiayuan Xu: With sufficient funding in place, we believe we can maximize the benefits of our e-commerce cooperation with TikTok Shop, acquire additional new borrowers from diversified channels, and sustain continued high growth rates.

Jiayuan Xu: 现在转到我们的金融分析, This quarter's operational excellence leads to better-than-expected financial results. Net revenue for the quarter reached RMB 3.17 billion, up 3% year-over-year.

Speaker Change #122: In the second half of the year and for the third quarter, We expect Indonesia operations will resume group of over 10%.

Jiayuan Xu: Our net income was RMB 551 million, a 4% increase quarter-over-quarter, and the scoring of our operation is stability. Meanwhile, sales and marketing expenses increased by 5% sequentially to RMB 473 million as we continue to invest in growth across all of our markets.

Jiayuan Xu: As we restructured our business mix, our leverage ratio adjusted to 3.5 times, indicating opportunities for dramatic growth when the economy further recovers.

Jiayuan Xu: Our balance sheet remains robust, with short-term liquidity maintaining a healthy level at RMB8.1 billion, reflecting our strength and flexibility in executing our legal strategy to advance our international expansion and drive shareholders' return.

Jiayuan Xu: Consistently, rewarding our shareholders remains a top priority for FinVolution, both through business goals across different markets and our market-leading capital return program, incorporating share repurchase and dividends. Our first share repurchase program began in March 2018, shortly after our IPO in November 2017, and has been widely embraced by our shareholders. Our buyback history indicates two repurchase programs with a total deployment of around U.S. 260,000,000, We are now conducting our 3rd repurchase program of up to US $115 million. Notably, in the second quarter, we deployed around 13 million and repurchased 6.1 million ADS.

Jiayuan Xu: For the first half of 2024, we have deployed around US $15.7 million for share repurchase. Our total cumulative share repurchase amount reached US $337 million as of the end of the second quarter.

Jiayuan Xu: In addition, our dividends have steadily increased over the past four years, with the cumulative dividend amount reaching US $325 million. In total, our capital return program has returned US $662 million to our shareholders, with a payout ratio rising to 49% of net profit in 2021.

Speaker Change #122: We've transaction volume potentially potentially reaching new record high Indonesia online our preference remains stable with credit Suisse customer acquisition improvement consistent for offline operations. We have complete the acquisition of a multi finance license with <unk>.

Unknown Executive: We have completed the acquisition of a multi-finance license with a controlling stake of 83.7%.

<unk> of 83, 7%.

Xiaoxiong Ye: Next, our second international market at the Philippines, as of July 2004, its manufacturing PMI has remained about 15% for 11 consecutive months. The Philippines' labor market is also exhibiting positive momentum. With an employment rate dropping to 3.1% as of June 2024, around 4.5% compared to the same period the last year, furthermore, private consumption contribution to 17.2.5% of the Philippines' nominal GDP in the second quarter of 2024, reflecting robust domestic amounts that will further support the nation's rapid economic growth.

Unknown Executive: Going forward, we will proactively explore both online and offline China's multi-products and buy now-paylators' installments for different scenarios such as We will fully leverage our China expertise and leverage them in our Indonesia market to ensure future growth.

Tiezheng Li: Going forward, as China's microenvironment improves, we are confident of resuming faster, growth and delivering consistent returns across multiple metrics for all our stakeholders.

Jiayuan Xu: Going forward, we will continue to strengthen our capital return program for our shareholders.

Speaker Change #122: Going forward, we will proactively explore both.

Jiayuan Xu: In summary, our solid second-quarter results showcase our legal strategy's effectiveness, our nameable business model and our technological advantages.

Jiayuan Xu: We expect our Indonesia operations to become profitable in 2024, and our Philippines operations to be contributed to profits in 2025, boosting our confidence in deploying a more proactive international expansion strategy, as we capitalize on the massive opportunities in the international market.

Jiayuan Xu: We look forward to delivering sustainable growth and sharing our success with all our stakeholders.

Speaker Change #122: And offline China's.

Speaker Change #122: Multi products and buy now pay leaders installments for different scenarios such as.

Speaker Change #122: Electric bikes et cetera, we will fully leverage our China expertise and leverage them in our Indonesia marquee to ensure future growth.

Speaker Change #122: Okay.

Jiayuan Xu: That concludes my prepared remarks.

Hello, Cindy any more questions from you.

Tiezheng Li: With that, I will now turn the call over to our CFO, Jiayuan Xu, who will discuss our operational and financial results in great detail.

Speaker Change #122: Yeah.

Speaker Change #122: Hello.

Jiayuan Xu: Thank you, Li, and hello everyone.

Cindy Wang: Thank you.

Unknown Executive: Thank you.

Operator: We will now open the floor to the questions.

Cindy Wang: Thank you and our next question will come from Yodlee of CRC C. Please go ahead.

Yada Li: And our next question will come from Yada Lin of CRCC. Let's go ahead.

Xiaoxiong Ye: Notably, our Philippines' operation continued to all perform expectations with the transaction volume growing 140% year-over-year, and 20% quarter-quarter to R&B 600 and 74 million in the second quarter, representing 29% of the international transaction volume. These outstanding performance reflects joint support from our local partners such as C-bank, Union Bank, and Maya Bank. Our latest founding partners, who recently partnered with us on a US 47-minute program. With sufficient funding in place, we believe we can maximize the benefits of our e-commerce cooperation with T-Toc shop, acquire additional new borrowers from diversified channels, and sustain continued high growth rates.

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Speaker Change #128: Yeah, I'd say about it.

Yada Li: Then I will do the translation. Hello Management. Thank you for taking my questions.

Jiayuan Xu: Let's go through our key results for the second quarter.

Speaker Change #129: I'll do the translation Hello management. Thank you for taking my questions and I was wondering whats the plan and the growth target for the company's domestic business and I will notice that the company has gained slightly faster volume growth compared with our peers and looking ahead are likely to come you can maintain.

Operator: Operator, please continue.

Jiayuan Xu: To be mindful of the length of our earnings call today, I encourage listeners to refer to our second quarter earnings press release for further details.

Jiayuan Xu: Despite China's 5% GDP growth in the first half of 2024, uncertainty still persisted in the macro environment.

Jiayuan Xu: Small ticket items and tourism-related activities remained the bright spot with the May holiday. 618 Shopping Festival and Consumption-Related Index all showing signs of improvement.

Jiayuan Xu: However, China's overall retail sales slowed to 2% growth the over year in June, which does not reflect an optimal recovery trajectory.

Yada Li: And I was wondering what's the plan and growth target for the company's domestic business. And I will notice that the company has gained a slightly faster volume growth compared with the peers. And the looking ahead, how likely the company can maintain such growth and how that will come to balance the volume growth and profitability. That's all. Thank you.

Jiayuan Xu: China's Manufacturing PMI Index remained largely stable in July with Manufacturing PMI holding steady at 49.4 points.

Jiayuan Xu: Concurrently, Manufacturing PMI and Compensated PMI both reached 15.2 points, which is within the expansion range, indicating Chinese enterprises' gradual production recovery.

Speaker Change #130: Growth and how the company balanced volume growth and the profitability. That's all thank you.

Xiaoxiong Ye: Now, turning into our financial metrics.

Speaker Change #129: Yeah.

Unknown Executive: Thank you, Yada.

Operator: 謝謝, We will now begin the question and answer session.

Speaker Change #131: Hey, good luck with that.

Unknown Executive: I will answer this question. In the domestic market, there are still some changes in the past few years. One of them is that the environment is relatively weak. And then in the consumer market, the supply of the customer is changing. The industry is entering a relatively mature phase. In addition, in the next half of the year, the industry has also appeared in some Chinese news. Then we will also observe the situation in the industry. In this way, we will also observe the situation of the consumer market. In this way, we will observe the situation of the consumer market.

Operator: To ask a question, you may press star, then one on your touch-tone phone.

Xiaoxiong Ye: These quarters, operation no excellence needed to be expected to financial results. Natural revenue for the quarter reached R&B 3.17 billion, up 3% year-over-year. Our net income was R&B 5.51 million, a 4% increased quarter-over-quarter.

Operator: If you are using a speaker phone, please pick up your handset before pressing the key.

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Jiayuan Xu: In short, although China's economy is recovering, there are still pockets of turbulence, which we will need to navigate using our vast experience in the technological and operational process.

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Speaker Change #137: Let's just talk with equity.

Thiagen Lee: This is Thiagen Lee, CEO of Involving.

Unknown Executive: Group, Xiaoxiong Ye, Thomas Chong, Tiezheng Li, Jianan Han, Tiezheng Group, Xiaoxiong Ye, Thomas Chong, Tiezheng Li, Jianan Han, Tiezheng Li, Jianan Han, Tiezheng Li, Jianan Han, Tiezheng Li, Jianan Han, Tiezheng Li, Jianan Han, Tiezheng Li, Jianan Han, Tiezheng Li, Jianan Tiezheng Li, Jianan Han, Tiezheng Li, Jianan Han, Tiezheng Li, Jianan Han If you are using a speaker phone, please pick up your handset before pressing the key. If at any time your question has been addressed, and you would like to withdraw your question, please press star then two. For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, we ask that you please kindly repeat your question in English.

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Jiayuan Xu: As Li mentioned, our performance in the first half of the year was solid with transaction volume growth in both China and the international markets landing within our guidance range.

Jiayuan Xu: This was supported by consistent excellence across numerous other areas, such as institutional funding, loan collection and retail performance, among others. Let me walk you through some of the details.

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Speaker Change #158: To assist you dig attrition.

Unknown Executive: Thirdly, we have a healthy diet. We have a lot of advantages in our diet. In the current situation, we are basically able to maintain a healthy diet. We are not able to maintain a healthy diet.

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Jiayuan Xu: During the second quarter, our average borrowing rate in China remained stable at IRR 22.2%, validating our strong commitment to advancing financial inclusion. Given financial institutions' growing desire to obtain good-quality borrowers for our platform, our funding costs improved significantly, shrinking another 90 bps during the quarter and recording a cumulative improvement of 114 bps in the first half of 2024, leading to consistent improvement in our tick rate. Such a huge semiannual improvement in funding costs underscores financial institutions' deep trust in our credit risk assessment capabilities and our ongoing enhancement of the quality of our borrowers.

Jiayuan Xu: Given the quality of our borrowers and ample market liquidity, we are confident of achieving continued improvement in funding costs in the second half of the year. Regarding risk management, the recovery economy and our agile adjustment to our credit risk, assessment models show progressive improvement in our day-one delinquency rate, which fell by 10 basis points sequentially to reach 5.1% for the quarter.

Speaker Change #160: The whole year, but towards the gene somebody you wash on the take rate.

Jiayuan Xu: From a vintage perspective, we maintain our view that vintage delinquency will stabilize, at around 2.5%. By referring our responsive payment deduction strategy, we have enhanced the efficiency of our loan collection process, resulting in an improvement in our loan collection to 88%, up 200 basis points from the previous quarter.

Jiayuan Xu: We expect this strong recovery momentum of loan collection will persist in the second half of the year.

Jiayuan Xu: Furthermore, as we continue to optimize our operations, we have strategically adjusted our business portfolio to adapt our partners' involving requirements.

Jiayuan Xu: For the first half of 2034, transaction volume for our international market reached RMB4.5 billion, up 32% year-over-year to reach the upper range of our guidance.

Thiagen Lee: We are happy to speak with you today.

Speaker Change #160: Shahada, you'll hit it rich.

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Speaker Change #160: To the local luxury he bought Cindy hinder you with nickel shaping Suez and then they'll go with that to the Boston Garden, which I'm sure you do it.

Speaker Change #161: I didn't hinder dividends on anything.

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Speaker Change #161: Yes.

Unknown Executive: Hello, Yada. Let me do the translation for Alexis. As you know, the China market has some changes this year and it is very different from the previous year. Currently, the scale of China's consumer market has slowed down and entered into the stage of increased competition. After the fiscal re-structuration in the industry during the second half of 2023, many players have experienced very deteriorated reduction.

Operator: If at any time your question has been addressed, And you would like to withdraw your question, please press star then two.

Speaker Change #161: Hello, Yeah, let me do the calculation for Alexis.

Operator: For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, we ask that you please kindly repeat your question in English.

Operator: At this time, we will pause for a moment to assemble our rock.

Speaker Change #161: As you know China market assumption just.

Operator: Our first question today will come from Cindy Wang, of China Renaissance.

Speaker Change #163: This year and it is very different from the previous year and comment on the scale of China control market has slowed down and entered into a stage of increased competition.

Unknown Executive: At this time, we will pause for a moment to assemble our roster.

Speaker Change #164: After the physical restructuring the industry during the second half of friendly country. Many peers have experienced varying degree of further reduction.

Cindy Wang: Our first question today will come from Cindy Wang of China Renaissance. Please go ahead.

Unknown Executive: Under the uncertain macro environment, we are searching for certainty that is beneficial for us and execute sustainable development in China. We have a few ways to achieve this. First of all, we have certainty for success on acquiring new borrowers through information fees, leveraging on data and behaviour. We continue to optimize the information fees China and improve the algorithms and conduct joint modeling to enhance our minds. We are able to increase the accuracy in determining the lifetime value of our customers and maintain a stable customer acquisition strategy. Transaction volume contributed by new borrowers was up 2%, and 27% year over year.

Speaker Change #165: Under the uncertain macro environment, we are searching for certainty that is beneficial for us and execute sustainable development in China. We have a few ways to achieve this first of all we have certainty for success acquiring new ballroom was true information feeds leveraging one data and behavior, we continue to optimize.

Thiagen Lee: We end the first half of 2024 on a post-tab note, driving progress girls in the China market while maintaining our right-paid girls momentum internationally.

Cindy Wang: [inaudible] Hello, Cindy, let me do the translation. Regarding China demand during the second quarter, the trend of global borrowers demand is largely in line with the witness in residential credit demand. The daily application rate of repeat borrowers declined by a mid-single digit around 6% on an annual basis and quarterly comparison, reflecting with consumer confidence in July and August. We have observed that the application rate of our repeat borrowers has increased by mid-single digit between 6% to 7% on a daily basis. The demand of our borrowers is concentrated in the area of daily necessity.

Speaker Change #165: The information fees Chinas and improve the algorithms.

Speaker Change #165: And conduct joining model into enhanced online.

Speaker Change #165: And we are able to increase accuracy and determining the lifetime value of our customers and maintain stable customer acquisition strategy.

Speaker Change #166: Transaction volume contributor by new bundle was up 2%.

Speaker Change #166: And 27% year over year.

Unknown Executive: A percentage of new customers was between 12-15% at the same time. We are able to have better cost control and a healthy LCD level. Apart from information fees China, we are also actively diversifying our customer acquisition in China and have found multiple new internet platform partners to work with us. In addition, we are also leveraging on our brand to influence our borrowers. For example, during the Olympics period, our support for the national weightlifting teams has achieved tremendous success along with their wins at the Games. Along with promoting a positive image for China Olympics, we have also gained remarkable results of over 100 million views and over 30 million accounts of video traffic transmission.

Speaker Change #167: Our percentage of new customers was between 12% to 15% at the same pump EBIT will have better cost control and a healthy.

Speaker Change #167: <unk>.

Speaker Change #168: Apart from information fees. China's we are also actively diversifying our customer acquisition, China's and have found multiple new Internet platform partners to work with US. In addition, we are also leveraging on our brand influence our borrowers for example, during the Olympics period, our support for the National Weightlifting teams has achieved tremendous.

Thiagen Lee: So, determining the strong execution of our local excellence global outlook strategy, our simply L-E-G-O legal strategy.

Thiagen Lee: We made great strides across our business in the markets in which we operate.

Thiagen Lee: Cumulatively, we have served around 31.5 million borrowers across China, Indonesia and the Philippines as of June 30, 2024. During the first half of 2024, transaction volume for the China market reached 92.5 billion R&B of 6% year over year.

Speaker Change #168: This success along with our wins.

Speaker Change #168: But long with promoting a positive image for China Olympics. We have also gained remarkable results of over 100 million views and what <unk> millions console video traffic transmission.

Unknown Executive: And secondly, the management of repeat borrowers is a certainty for us, and we have over 17 years of operating history, and we are very familiar with our borrowers. Through excavating the diversified multi-layers and differentiated requirements, we will then refer them with the most suitable product based on different scenarios such as user profiles and behavior characteristics. And all these have lead us to increase our users' promotion impact by 36% in the first half, which leads to a higher transaction volume for repeat borrowers.

Speaker Change #169: And secondly, the management of repeat borrowers is a certainty for us and we have over 60 at 17 years of operating history, and we are very familiar with our borrowers true deeply.

Speaker Change #170: <unk> got diversified multi layers and differentiated requirements.

Speaker Change #171: We will refer them with the most suitable products based on <unk>.

Speaker Change #172: He brings in a row, such as user profiles and behavior characteristics.

Speaker Change #172: And all this has led us to increase our users promotion impact by 36% in the first half which leads to higher transaction volume for repeat borrowers.

Unknown Executive: Thirdly, our business operations remain healthy with stable support. with continuous improvement in funding costs, which leads to progressive improvement on multiple funds such as Tigrid. All these ensure our high quality growth, which is above the industry and lead the cornerstone forward, sustainable growth going forward.

Our business operations remain healthy with stable performance.

Jiayuan Xu: Supported by the strong global microenvironment and our effective legal strategy, we believe our international business growth momentum is sustainable with further diversification among different business models.

Speaker Change #172: With continuous improvement in funding costs, which leads to progressive improvement on multiple fronts, such as ticket audits and through our high quality growth.

Speaker Change #172: Which is above the industry and lead the cornerstone of our sustainable growth going forward.

Unknown Executive: Okay, thank you, Yada Li, Tiezheng Li. Okay. Thank you, Yada. Thank you.

Speaker Change #173: Okay. Thank you guys.

Speaker Change #173: Yes.

Speaker Change #174: I would say.

Speaker Change #174: Yes.

Speaker Change #174: Yeah.

Speaker Change #174: Okay again, thank you Heather.

Cindy Wang: Therefore, when the economy is weak, it will show more resilience and we expect demand will gradually improve in the second half of the year.

Thiagen Lee: Transition volume for international market continue to grow rapidly, sorry into 4.5 billion R&B up 32% year over year.

Speaker Change #174: Okay.

Thank you.

Unknown Executive: And again, if you would like to ask a question, please press star, then one.

Speaker Change #175: Again, if you would like to ask a question. Please press Star then one.

Alexi: And our next question today will come from Alexi of UBS. Please go ahead. The indicators have been improved in the second quarter. Just wondering what are the key drivers behind and the recent trend.

Speaker Change #175: Okay.

Speaker Change #175: Our next question today will come from Alex <unk>.

UBS: UBS. Please go ahead.

Cindy Wang: Please go ahead.

Alex: Good morning.

Speaker Change #178: I think about 300 million.

Alex: Okay.

Alex: No.

Alex: Yes.

Alex: It seems to be okay.

Alex: Good.

Alex: So I'm going to answer.

Alex: Are you going to.

Speaker Change #179: Student needs and some of them in a home use.

Speaker Change #179: Most economic issues isn't going beyond that.

Yada Lin: [inaudible][inaudible] So, let me do the translation. From the International Marketing Department, it is presenting a much more positive trend. After the Indonesia election, political situation has normalized with an improving economy, such as GDP increase. And let us concentrate on the power performance in Indonesia during the second quarter transaction volume for Indonesia market reach 1.64 billion after about 6 to 7% annually without standing loan balance between 1.0 billion up about 4% revenue for the quarter reach 430 million.

Giovanni: This yard banking Giovanni.

<unk> Julien and Lithuania.

Giovanni: Yes.

Giovanni: Okay.

Giovanni: Sure.

It's going to take rate Caligula lunches with pricing.

<unk>.

Giovanni: Yes.

Giovanni: I hope the economy and in fact, one thing.

Giovanni: That's the intend on hiring those actually identical.

Cindy Wang: 好的,謝謝管理層給我這個提問的機會 那我這邊有兩個問題想請問 第一個問題的話是想請問一下中國的市場 可不可以大概跟我們說一下 就你們看到的可能第二季度 這個借款人的一個需求的一個變化 然後以及7月目前看到的一個狀況是怎麼樣 然後第二個問題的話呢 想請問的是印尼的市場 因為我們知道就是印尼市場這邊的一個 整體的API已經調整到位了嘛 那所以目前來看的話 印尼現在的一個貨客的一個策略是怎麼樣的 然後有沒有一個最新的更新 就是關於監管對於API這邊的一個要求 在2025年有沒有一個新的更新出來 那我很快翻譯一下我的問題 謝謝管理層接受我的電話 我這邊有兩個問題 第一個問題是 可不可以給我們一些顏色 在第二季度的中國貨客的借款需求 以及7月份的借款需求 第二個問題是 印尼的客戶採購策略 在API達到要求之後 有沒有任何更新 關於2025年的利息需求的監管層的更新 謝謝, 好的,谢谢兄弟,我来回答一下第一个问题,然后第二个问题请我们李总来回答一下。 关于就是现在国内的这个需求应该说从这个宏观看到的数字和这个体感上还是比较一致的 整体还是比较比较疲弱还是略显一个低迷 所以我们在二季度看到比如说我们老克的日均的一个错额量 他其实环比和同比其实还是有一定的一个下降 大概是在6%左右, 消费性的信心还是略显不足 然后到了7月以后 我们最新观察到呢 这个数据是有所恢复啊 大概恢复了大概6%到7%左右, 有一個這個中位數的一個上升 所以總的來看呢 我們覺得我們這個人群呢 它的特點還是在 這個因為需求主要是集中在 日常消費當中 所以在雖然整個宏觀環境比較 疲弱的環境那個情況下呢 還是有一定的這個韌性 所以我們預計下半年這部分呢 會有一定程度的一個改善, Hello, Cindy.

Speaker Change #181: So my first question is.

Speaker Change #182: It's on a core piece of what we have noted the early indicators have seemed to improve in the second quarter. Just wondering what are the key drivers behind the recent trend.

Alexi: And should we be worrying about any potential uptake in PR in the second half, like in the third quarter last year?

Speaker Change #183: And should we be worrying about any potential.

Speaker Change #183: Kick.

Speaker Change #183: In.

NPL in second half Mike in the quarter last year and second question is on the.

Alexi: And second question is on the sequential trend on the takeaway. What has been the key drivers behind? What's the outlook for the second half? And it's improvement for the funding cost.

Speaker Change #184: Sequential trend on integrate what has been the key drivers behind.

Speaker Change #185: And what's the outlook for second half and is there any more improvement more room for improvement for the funding cost.

Unknown Executive: Thank you.

Cindy Wang: Let me do the translation.

Speaker Change #185: Although she accident level that has a longer winter.

Speaker Change #185: Do you have a question Glenn Glenn you omitted and that's essentially <unk>.

Speaker Change #185: This has all been shunyi and essentially what USA switch ACF, which a bottleneck to the Tuesday.

Speaker Change #185: While material here to go past that.

Speaker Change #186: As a woman digital format.

Speaker Change #186: So the clinical <unk> sufficient sufficiently Virginia D C.

Speaker Change #187: Uh huh.

Unknown Executive: So, we have not had too many data, but we have also done a lot of research on high-resistant human rights, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, and then we have done a lot of research on them, On the other hand, before the digital screen, we have also reported that the overall resolution is stable at 2.5 degrees.

Speaker Change #187: So in this whole milk hydrological stood UBS, yeah, that's a woman.

Speaker Change #187: <unk> took a golf, which I often get is inching towards efficient solution, whether you're switching the whole day.

Speaker Change #188: <unk>, let me say that internet.

Speaker Change #188: You can't even tell you wanted to put it so that you see thousands of squishy nickel quite so the <unk>. So they have been good the charge it.

Speaker Change #189: And so you'd say a teenage you don't add as usual I mean, Joe you got tangled unusual I think referring to yourselves and the joint Chiefs.

Speaker Change #189: So it's a high hurdle on the Guangzhou Felicia in immunology.

Speaker Change #190: Now well move Josh issues geopolitical or whatnot.

Speaker Change #191: With that she couldnt, Josh just cynthia that fulfill that OTC.

Speaker Change #192: They put hold up regulation G K <unk>, who can do that.

Speaker Change #193: Could you provide the technical buses and Jody.

Speaker Change #194: Are you eating food allergy in Asia.

Speaker Change #194: Since you wanted to go from call niches in the golf Digest, China's a shovel.

Speaker Change #195: So that I meant to say.

Speaker Change #195: You'll get that ASIC of alcohol.

Speaker Change #195: <unk> to.

Speaker Change #195: So when these Audi Toyota Kushan thought she does if we need to be honest.

Speaker Change #195: Sure.

Speaker Change #195: And then Colorado <unk>.

Speaker Change #195: We want to do is just as you mentioned egotism top as Bob.

Speaker Change #195: So he may here switching on what kind of order, which is the highest about Youtube souchong.

Speaker Change #195: The whole <unk>.

Speaker Change #195: Yeah.

Speaker Change #195: With that as it relates to the <unk>.

Unknown Executive: It is not a big deal, because the overall resolution is still a better situation. In addition, I would like to say that we have been experiencing this experience for 17 years. In fact, there have been a lot of changes in the digital screen. We have almost 4 of them. In fact, this is also a relatively normal performance. The average resolution of the digital screen is 4.5 degrees. It is at least 7 months. It is at least 2 months. In the last half of the year, in the middle of the day, the digital screen is relatively small.

Speaker Change #195: We do have a question you were talking here is that the shoes of the Hiseq.

Speaker Change #196: Peter shareholder John maybe qinhuangdao.

Speaker Change #196: Downhole.

Speaker Change #196: If we shrink and as usual the cord she well Mr. Joseph senior living communities.

Thiagen Lee: In terms of outstanding violence, China reached 64.2 billion R&B while our international market showed to 1.4 billion R&B up 3% and 27% respectively year over year.

Thiagen Lee: This standard performance stands out as a testament to the effective execution of our legal strategy and the unveiling commitment of our team.

Speaker Change #196: So that's it.

Speaker Change #196: The Eagle Ford the largest yet switched out with what that will mean Youtube lymphocytosis.

Speaker Change #196: So it's a <unk>.

Speaker Change #196: Yeah, we don't really <unk> Joseph.

Speaker Change #196: You go to the <unk>.

Speaker Change #196: Potentially zimmer.

Speaker Change #196: It sounds little bottle in the mid to the events issue. So I'm curious how the U C.

Speaker Change #196: Yeah.

Speaker Change #196: So we choose to shop on the Internet.

Speaker Change #196: So that also <unk>. So just as you do that.

Josh: Josh I'll, let Johnny you talked you could be at one.

Unknown Executive: In our history, we have seen that the digital screen will appear in 5 months. This time, it is not a very special situation. It is now seen that it is going to be a miracle. So we are not very worried about this change. In the past, we have experienced this experience very successfully.

Josh: The at home, Lisa G and I kind of <unk> Suisse.

Josh: So we just see a precisely there could be a closer linkage.

Speaker Change #198: Did you say that you can't gala aging.

Speaker Change #198: Uh huh.

Speaker Change #198: So you will learn copper so hybridizing Johnny <unk> chairwoman.

Yada Lin: Number of borrowers reach 530,000 up 4% sequentially and number of new borrowers reach 200,000 up 9% sequentially. We have cumulatively cooperated with 7 financial institutions and all our fundings is from local financial institutions now. Our Indonesian operations has completed its driving transition in just 5 months and we have made adjustment in borrowers' cohorts, modest iteration and credit risk has improved by 28%, meaningfully offsetting the impact of interest reduction. Therefore, our take rate returned to 10%, reflecting our business entering a more stable state.

Speaker Change #198: So can you fit Hudson Gonda, hopefully that Johnny Virginia.

Speaker Change #198: Yeah.

Jiayuan Xu: Moving on to our international expansion efforts, Indonesia, our first and largest overseas market, has shown continued growth in its, macroeconomy throughout the first half of this year, with a recorded GDP growth of 5.05% for the second quarter and a targeted GDP growth of 5.2% for full year 2024. The Indonesia Consumer Confidence Index has remained high at above 120% for 18 months. The volume of motorbike, sales increased 26% year-over-year and 17% sequenced to 599,000 as of July 2024, further illustrating the nation's heightened consumer optimism.

Unknown Executive: Hello, Alex, let me do the translation. Regarding our overall asset quality, during the initial stage of the risk situation last year, we leveraged on our years of experience and preemptive accurate predictions of the industry trends. Titan approval rates for risk yield both higher debt, higher risk and soil, different strategies for medium risk growth level and quickly adjust about the risk strategies during the early stages of the inconsistency. In the first quarter, risk performance stabilized, and we are one of the earliest platforms in the industry that are able to contain risk at a lower level. During the second quarter, we further optimised, adjusted, and iterated on the overall credit limit and explored solutions for different types of users, while maintaining growth in transaction volume and balancing risk.

Alex: Hello, Alex Let me do the translation regarding our overall asset quality during the initial picture of the refrigeration last year, we leveraged our years of experience and pre emptively accurate predictions of the industry trends.

Cindy Wang: Regarding China demand, during the second quarter, the trend of our borrowers' demand is largely in line with the weakness in residential credit demand.

Cindy Wang: The daily application rates of repeat borrowers declined by mid-single digit around 6% on an annual basis and quarterly comparison reflecting weak consumer confidence. In July and August, we have observed that the application rates of our repeat borrowers has increased by mid-single digit between 6% to 7% on a daily basis.

Cindy Wang: The demand of our borrowers is concentrated in the area of daily necessities.

Alex: Title of Cooper reached a riskier portfolio higher that higher risk assets.

Speaker Change #200: <unk> strategy strong medium risk group.

Speaker Change #200: And quickly adjust abounded boundary strategies during the early stages of delinquencies.

Speaker Change #200: And in the first quarter with performance stabilized and we are one of the earliest platform in the industry got to able to contain risk at a lower level.

Yada Lin: For the third quarter, in the second half of the year and for the third quarter, we expect Indonesia operations will resume group of over 10%. With transaction volume potentially reaching new record high, Indonesia online operations will remain stable with credit risk, customer acquisitions, improving consistently for offline operations.

Speaker Change #200: And during the second quarter, we further optimized adjusted to read.

Speaker Change #200: On the overall credit limit and explore solutions for different types of users.

Speaker Change #200: While maintaining growth in transaction volume and balancing Greece.

Unknown Executive: We have also shared that during the second quarter, our vintage delinquency remains stable at 2.5%, while day one delinquency reduced by 10 basis points to 5.1%, and loan collection recovery rate improves to 88%.

Speaker Change #200: And we have also shut that during the second quarter, our vintage delinquency remains stable at two 5% while day, one delinquency reduced by 10 basis points to five 1% and loan collection recovery improve to 88%.

Yada Lin: We have completed the acquisition of a multi-finance license with a controlling stake of 83.7%. Going forward, we will proactively explore both online and offline China's multi-products and buy now-paylators' installments for different scenarios such as We will fully leverage our China expertise and leverage them in our Indonesia market to ensure future growth.

Yada Lin: Thank you.

Unknown Executive: We do not think this situation will happen in the second half as the overall environment is much more stable now.

And we don't in this situation what happened in the second half at the overall environment is much more steep steep and now I would like to share with you.

Unknown Executive: I would like to share more information with you. Over the past 17 years in our operating history, industry-wide fluctuations in asset qualities have occurred four times. Such fluctuations on average last around four to five months, with the longest lasting seven months and the shortest lasting two months. The fluctuations for this route is considered to be midterm, and the impact of fluctuation is smaller based on past recovery experience. The recovery process normally takes place at between the 4 to 5 months. Therefore, the fluctuation this time round is not unique and has a riddance shown signs of recovery.

Speaker Change #200: To share more information with you over the past 17 years in our operating history industry wide fluctuations in asset quality have acre four times.

Speaker Change #200: And such fluctuations on average loss of around four to five months with the longest lasting seven months and the shopper slapping two months. The fluctuation for this round is considered to be mid term and the impact of fluctuation based on past recovery experience.

Speaker Change #200: The recovery process.

Lease at between four to five months. Therefore, the fluctuation this time around it is not unusual.

Cindy Wang: Oleh itu, apabila ekonomi lemah, ia akan menunjukkan lebih banyak kekuatan dan kami mengharapkan keperluan akan semakin meningkat pada separuh kedua tahun.

Yada Lin: And our next question will come from Yada Lin of CRCC. Let's go ahead.

Speaker Change #200: And has a reinsurance signs of recovery.

Unknown Executive: And we are competent to handle any more of such fluctuations in the future based on our experience.

Speaker Change #200: And we are competing to handle any more of such fluctuations in the future based on our experience.

Speaker Change #200: Okay.

Speaker Change #200: Thiago and Hugo element of the take rate.

Cindy Wang: 關於印尼的情況,我來做一下簡要的回答。 從宏觀上面我們看到 印尼的整体宏观情况我们认为是比较理想的 大选之后政治环境相对比较稳定, 我們看到的GDP 居民消费、消费者信心指数、PMI等数字都是相对比较理想的, 接下来呢关于我们在印尼的一些业务的表现 二季度我们在印尼的这个交易量大概是在16亿 16.4亿左右的这个人民币的这个交易规模 同比呢大概是6.7%的增长 余额呢在10亿元左右 也是有一个4.几%的增长 我们的收入是4.3亿 二季度呢 我们的借款人数达到了53万 然后其中呢 新客户人数呢 有20万 环比呢 有9%的增长, 另外我們在當地已經與當地的七家金融機構建立了 合作关系 目前我们印尼的信贷资金 基本上是由本地的经济提供, 关于定价调整,我们知道在今年年初印尼监管政策要求下,我们进行了业务定价的调整。 那我们用了大概五个月左右的时间 那我们完成了对人权, 模型以及风险的一系列的优化 那这里呢 也分享一下我们的一些成果 我们的目前我们的整体的风险 较去年同期呢 大概优化了这个28% 那我们的显著呢 抵消了这个定价下调呢 对于整个业务的这个take rate的影响 那我们目前的这个印尼的这个take rate 那大概呢这个回到了基本上回到定价调整前的23年 在10%左右的水平, 那业务呢进入到一个稳定的这个阶段 那接下來對於我們來講印尼的這個發展的這個重點 那我覺得有幾方面 一方面呢在我們的這個定價調整完之後呢 我們在三季度印尼業務將恢復增長 我們預計呢三季度的印尼業務成交量呢 將創新高 環比呢增速超過百分之十, 另外我们在印尼也会在风险、货客等方面在线上的业务进行持续的优化 我们在稳定增长的同时 我们在线下已经完成了在本地的多元金融牌照83.75%的股份收购 未来我们会积极地探索, 线下和线上,以及多产品,包括现金贷,包括场景分期,包括手机,两轮电动车等 不同的場景的這個結合, 那将我们在这个国内积累的这些经验跟能力呢 充分的在印尼市场上服用 那实现了业务的这个稳定增长, Hello Cindy, let me do the translation.

Speaker Change #201: Two women what Tiger Yeah I.

Speaker Change #202: But I think you have them in a total of about <unk> <unk>.

Hugo: I'm, sorry, the harder because I think jago with it now.

Hugo: <unk> for instance.

Hugo: Within the audio.

Speaker Change #204: So the takeaway a woman that it shall be <unk> to the <unk> results as usual Sunday E.

Unknown Executive: The third question is about the takeaway. The second question is about the takeaway. The takeaway is about the takeaway.

Yada Lin: Then I will do the translation.

Speaker Change #204: Now, let's jump right into <unk>.

Yada Lin: Hello management. Thank you for taking my questions. And I was wondering what's the plan and growth target for the company's domestic business. And I will notice that the company has gained a slightly faster volume growth compared with the peers. And the looking ahead, how likely the company can maintain such growth and how that will come to balance the volume growth and profitability.

Yada Lin: That's all. Thank you.

Speaker Change #204: The whole thing.

Speaker Change #204: Sure.

Speaker Change #204: <unk>.

Speaker Change #204: Because I know somebody interested since you probably utilize it based on data that shall Danielle would you estimate that it will kind of put up with that.

Speaker Change #205: Hudson tissue eating that you see.

Speaker Change #205: And what you Keith and good for the takeaway that you guys sniggle within that but I'm just saying.

Uhm.

Speaker Change #205: Okay.

Speaker Change #205: Uh huh.

Speaker Change #205: It's hard to say I do see women J E T two arches, which actually that you can get.

Speaker Change #205: Income as the shutdown of the devices.

Speaker Change #205: Does that lead to size it took us a faithful fully on board with that negotiation.

Speaker Change #206: The whole thing somebody who said I don't know what are the if.

Speaker Change #206: And you'll see that we're looking at this time.

Yada Li: Thank you, Xiaoxiong Ye, Yada Li, I will answer this question[inaudible] Thirdly, we have a healthy diet. We have a lot of advantages in our diet. In the current situation, we are basically able to maintain a healthy diet.

Speaker Change #207: So I say that the 100 in EMEA.

Wayne: So Wayne.

Speaker Change #209: <unk> also just go back to things on that John that the P&I, So you'll <unk>.

John Legere: Controller John <unk>.

John Legere: I think at a high chain.

John Legere: So you talked about a woman to continue until those ounces attrition there you go.

Peter: Peter you want to.

Peter: Uh huh.

Jiayuan Xu: Beside a moderate correction to 49.3% in July 2024, Indonesia's manufacturing PMI has remained above 15% since September 2021, reflecting nearly three consecutive years of sustained economic prosperity.

Jiayuan Xu: The unemployment rate decreased for the year-over-year in March 2024 to 4.8% from 5.5% in the same period last year, further strengthening consumers' confidence.

Jiayuan Xu: After two quarters of business adjustment towards better quality spoilers under the new pricing cap, we are proud to share that we have stabilized our operations in Indonesia and continue to gain recognition from local customers and other stakeholders.

Yes.

Jiayuan Xu: This recognition has attracted new funding partners, including a leading local digital, bank.

Jiayuan Xu: We are also steadily building and strengthening our relationships with larger and more reputable, local financial institutions to diversify our funding sources, thereby optimizing funding costs.

Cindy Wang: 从互联网的环境来看,这正在展现更多的正面趋势, After the Indonesian election, political situation has normalised with an improving economy such as GDP increase.

Unknown Executive: Hello, Alex, let me do a translation. Regarding takeaway, during the second quarter, our average borrowing rate remains stable at 22.2%. Funding costs optimized by many beats in the second quarter while vintage didn't consume remains stable at 2.5% and take great further improved to around 3.1%.

Hello, Alex Let me do a translation regarding take rate.

Jiayuan Xu: Next, our second international market, the Philippines.

Jiayuan Xu: As of July 2094, its manufacturing PMI has remained above 15% for 11 consecutive months.

Jiayuan Xu: Furthermore, private consumption contributed 72.5% of the Philippines' nominal GDP in, the second quarter of 2024, reflecting robust domestic demand that will further support the nation's rapid economic growth.

Cindy Wang: And let us concentrate on our performance in Indonesia.

Jiayuan Xu: The Philippines' labor market is also exhibiting positive momentum, with the unemployment rate, dropping to 3.1% as of June 2024, from 4.5% compared to the same period last year.

Jiayuan Xu: Notably, our Philippines' operations continue to outperform expectations, with transaction, volumes growing 140% year-over-year and 20% quarter-over-quarter, to RMB 674 million in the second quarter, representing 29% of the international transaction volume.

Cindy Wang: During the second quarter, transaction volume for Indonesian market reached $1.64 billion, up about $3.5 billion.

Jiayuan Xu: This outstanding performance reflects strong support from our local partners such as C-Bank, Union Bank, and Myer Bank, our latest funding partners who recently partnered with us on a U.S. $47 million program.

Cindy Wang: 每年有7%的利润,与1.0亿美元的企业贷款平均约为4%。 平均利润达到430亿美元。 No.

Jiayuan Xu: With sufficient funding in place, we believe we can maximize the benefits of our e-commerce, cooperation with TikTok Shop, acquire additional new borrowers from diversified channels and sustain continued high growth rates.

During the second quarter, our average borrowing rate remained stable at 22, 2%.

Cindy Wang: 我们的互联网行业已经完成了 在5月份正式通过资金转换, And we have made adjustments in borrowers' cohorts, models' iteration, and credit risk has improved by 28%, meaningfully.

Cindy Wang: 4 Borrowers' Reach 530,000 up 4% secuntually and number of new borrowers, 200,000 up 9% sequentially We have cumulatively cooperated with 7 financial institutions, And all our funding is from local financial institutions now.

Jiayuan Xu: Now, turning to our financial metrics.

Jiayuan Xu: This quarter's operational excellence led to better-than-expected financial results. Net revenue for the quarter reached RMB 3.17 billion, up 3% year-over-year.

Jiayuan Xu: Our net income was RMB 551 million, a 4% increase quarter-over-quarter, underscoring our operational, stability. Meanwhile, sales and marketing expenses increased by 5%, equivalent to RMB 473 million as we, continue to invest in growth across all of our markets.

Jiayuan Xu: As we restricted our business mix, our leverage ratio adjusted to 3.5 times, indicating opportunities, for tremendous growth when the economy further recovers.

Cindy Wang: Offsetting the Impact of Interest Rate Reduction, Therefore, our take rate returned to 10%.

Jiayuan Xu: Our balance sheet remained robust, with short-term liquidity maintaining a healthy level at RMB, 8.1 billion, reflecting our strength and flexibility in executing our legal strategy to advance Consistently, rewarding our shareholders remains a top priority for FinVolution, both through, business goals across different markets and our market-leading capital return program incorporating share repurchase and dividends. Our first share repurchase program began in March 2018, shortly after our IPO in November, 2017, and has been widely embraced by our shareholders. Our buyback history indicates two repurchase programs with a total deployment of around, US$216 million.

Speaker Change #210: <unk> cost optimized by 90 bps in the second quarter walk into delinquency remained stable at two 5% and take rate improved to around three 1%.

Jiayuan Xu: We are now conducting our third repurchase program of up to US$115 million. Notably, in the second quarter, we deployed around US$13 million and repurchased 6.1 million, ADS. For the first half of 2024, we have deployed around US$157 million for share repurchase. Our total cumulative share repurchase amount reached US$337 million at the end of the second, quarter.

Jiayuan Xu: In addition, our dividends have steadily increased over the past four years, with the cumulative, dividend amount reaching US$325 million. In total, our capital return program has returned US$662 million to our shareholders, with the, payout ratio rising to 49% of net profit in 2023.

Jiayuan Xu: Looking forward, we will continue to strengthen our capital return program for our shareholders.

Jiayuan Xu: In summary, our solid second quarter results showcase our legal strategy's effectiveness, our nameable business model, and our technological advantages.

Jiayuan Xu: We expect our Indonesian operations to become profitable in 2024 and our Philippines operations, to contribute profits in 2025, boosting our confidence in deploying a more proactive international expansion strategy.

Jiayuan Xu: As we capitalize on the massive opportunities in the international market, we look forward, to delivering sustainable growth and sharing our success with all our stakeholders.

Jiayuan Xu: That concludes my prepared remarks.

Unknown Executive: For the second half of 2024, we expect average borrowing rates to remain stable, and funding costs and vintage didn't consist to have further optimization. Our asset quality is popular in such environment, and we are one of the few platforms that are able to maintain growth. This is the reason why we have more room to negotiate for better funding costs with our funding partners. Funding costs has accumulated improved by 140 basis points in the first half and improved by 90 basis sequentially. And going forward, we still believe it will have room for improvement based on what I have just said earlier.

Cindy Wang: 反映我們的生意進入更穩定的階段, For the second half of the year and for the third quarter, we expect Indonesia operations will resume growth of over 10%.

Speaker Change #210: For the second half of 2024, we expect average borrowing rates will remain stable and funding cost and vintage delinquencies to have further optimization.

Cindy Wang: Dengan volume transaksi yang berpotensi mencapai rekod baru yang tinggi, operasi dalam talian Indonesia akan tetap stabil dengan risiko kredit, pengambilan pelanggan berkembang secara konsisten.

Cindy Wang: Untuk operasi di luar talian, kami telah menyelesaikan pengambilan lisensi multifinansi dengan jangkauan pengawal 83.7%.

Cindy Wang: Going forward, we will proactively explore both online and offline channels, multiproducts and buy now pay later installments for different scenarios such as electronics and electric bikes etc.

Cindy Wang: We will fully leverage our China expertise and leverage them in our Indonesian market to ensure future growth.

Speaker Change #210: Yes.

Speaker Change #211: Our asset quality is popular in such environment and we are one of the few platforms that are able to maintain growth. This is the reason why we have more room to negotiate for better funding cost with our funding partners funding.

Speaker Change #212: <unk> funding cost has accumulated improved by 140 basis point in the first half.

Speaker Change #212: Okay.

Speaker Change #212: And improved by 90 basis sequentially.

Speaker Change #212: And going forward, we still believe it will have room for improvement based on what I have just said earlier.

Unknown Executive: Thank you.

Okay.

Operator: We will now open the call to the questions.

Unknown Executive: Okay, thank you, S. Okay, thank you.

Operator: Operator, please continue.

Speaker Change #212: Okay. Thank you.

Operator: Thank you.

Operator: To ask a question, you may press star, then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the key.

Operator: We will now begin the question and answer session.

Operator: If at any time your question has been addressed and you would like to withdraw your question, please press star, then 2.

Speaker Change #212: Okay. Thank you.

Operator: For the benefit of all participants on today's call, if you wish to ask your question to, management in Chinese, we ask that you please kindly repeat your question in English.

Operator: At this time, we will pause for a moment to assemble our roster.

Operator: As there are no further questions now, I'd like to turn the call back over to the company for closing remarks.

Unknown Executive: As there are no further questions now, I'd like to turn the call back over to the company for closing remarks. Thank you once again for joining us today. If you have any further questions, please feel free to contact the Impregutions Group Investor Relations team.

Cindy Wang: Hello Cindy, any more questions from you?

Speaker Change #213: As there are no further questions now I'd like to turn the call back over to the company for closing remarks.

Operator: Our first question today will come from Cindy Wong of China Renaissance.

Cindy Wong: 好的,謝謝管理層給我這個提問的機會,那我這邊有兩個問題想請問,第一個問題的話是想請問一下中國的市場,可不可以大概跟我們說一下,就你們看到的可能第二季度這個借款人的一個需求的一個變化,然後以及7月目前看到的一個狀況是怎麼樣,然後第二個問題的話呢,想請問的是印尼的市場,因為我們知道就是印尼市場, 這邊的一個整體的API已經調整到位了嘛,那所以目前來看的話,印尼現在的一個貨客的一個策略是怎麼樣的,然後有沒有一個最新的更新,就是關於監管對於API這邊的一個要求,在2025年有沒有一個新的更新出來,那我很快翻譯一下我的問題。 然後到了7月以後,我們最新觀察到這個數據是有所恢復,大概恢復了6%到7%左右,有一個中位數的一個上升。 所以總的來看,我們覺得我們這個人群,它的特點還是在這個因為需求主要是集中在日常消費當中,所以在雖然整個紅額環境比較疲弱的環境那個情況下,還是有一定的韌性,所以我們預計下半年這部分會有一定程度的一個改善。 您好,辛蒂,讓我來翻譯一下。 關於中國的需求,在第二個半月中,我們的租賃需求的趨勢大幅度相符於住宅信用需求的弱點。 每天的重新租賃的應用率在每個數字的6%左右,在每個月和每個月的對比中,在7月和8月中間,都反映出了低於消費者的信心。 我們觀察到,我們的重新租賃應用率在每天的對比中,在每個數字的6%到7%左右,在每個月和每個月的對比中,都反映出了低於消費者的信心。 我們的租賃需求集中在日常消費當中。因此,當經濟變弱時,它會顯現更多的堅持,我們預計需求將在第二個半月中逐漸改善。 关于印尼的情况,我来做一下简要的回答。 从宏观上面,我们看到印尼的整体宏观情况,我们认为是比较理想的。 大选之后,政治环境相对比较稳定。 我们看到的GDP,居民消费,消费者信心指数,PMI等数字,都是相对比较理想的。 接下来,关于我们在印尼的一些业务的表现。 二季度,我们在印尼的交易量大概是在16亿,16.4亿左右的人民币的交易规模,同比大概是6.7%的增长。 余额在10亿元左右,也是有一个4.几%的增长。 我们的收入是4.3亿。 二季度,我们的借款人数达到了53万,其中新客户人数有20万,环比有9%的增长。 另外,我们在当地已经与当地的7家金融机构建立了合作关系。 目前,我们在印尼的信贷资金基本上是由本地的金融机构提供。 关于定价调整,我们知道在今年年初,印尼的监管政策要求下,我们进行了业务定价的调整。 我们用了大概5个月的时间,完成了对人群模型以及风险的一系列的优化。 这里也分享一下我们的一些成果。 目前,我们的整体的风险较去年同期大概优化了28%。 我们显著抵消了定价下调对于整个业务的take rate的影响。 我们目前的印尼的take rate大概基本上回到了定价调整前的23年,在10%左右的水平。 业务进入到一个稳定的阶段。 接下来,对于我们来讲印尼发展的重点,我觉得有几方面。 一方面,在我们的定价调整完之后,我们在三季度印尼业务将恢复增长。 我们预计三季度的印尼业务成交量将创新高,环比增速超过10%。 另外,我们在印尼也会在风险、货客等方面在线上的业务进行持续的优化。 我们在稳定增长的同时,我们在线下已经完成了在本地的多元金融牌照83.75%的股份的收购。 未来,我们会积极地探索线下和线上以及多产品,包括现金贷,包括场景分期,包括手机、两轮电动车等不同的场景的结合。 将我们在国内积累的经验和能力,充分地在印尼市场上服用,实现业务的稳定增长。 你好,Cindy,让我来翻译。 From Indonesia's macro environment, it is presenting a much more positive trend.

Cindy Wong: After the Indonesia election, political situation has normalized with an improving economy such as GDP increase.

Cindy Wong: And let us concentrate on our performance in Indonesia. During the second quarter, transaction volume for Indonesia market reached $1.64 billion, up about 6% to 7% annually, with outstanding loan balance between $1.0 billion, up about 4%.

Cindy Wong: Revenue for the quarter reached $430 million.

Cindy Wong: Number of borrowers reached $530,000, up 4% sequentially. And number of new borrowers reached $200,000, up 9% sequentially.

Cindy Wong: We have cumulatively cooperated with seven financial institutions.

Cindy Wong: And all our funding is from local financial institutions now.

Cindy Wong: Our Indonesia operations has completed its pricing transition in just five months.

Operator: Thank you once again for joining us today.

Cindy Wang: 沒有其他問題,謝謝, 多謝, Thank you.

Speaker Change #214: Thank you once again for joining us today, if you have any further questions. Please feel free to contact and physicians group Investor Relations team. Thank you all and have a nice day.

Cindy Wong: And we have made adjustments in borrowers' cohorts, models' iteration, and credit risk has improved by 28%, meaningfully offsetting the impact of interest rate reduction.

Operator: And our next question will come from Yada Li of CICC.

Cindy Wong: Therefore, our take rate returned to 10%, reflecting our business entering a more stable state.

Operator: If you have any further questions, please feel free to contact PIMP Solutions Group Investor Relations Team.

Alexi: And second question is on the sequential trend on the takeaway.

Yada Li: Please go ahead.

Cindy Wong: For the second half of the year and for the third quarter, we expect Indonesia operations will resume growth of over 10%, with transaction volume potentially reaching new record high.

Yada Li: 管理层好,感谢给我这个提问的机会 今天想请教一下公司目前对国内业务 放款量是否有一个长期增长的规划和目标 然后相较同业我们看到公司当前的放款增速 其实是比较快的 未来是否有希望维持 然后在当前的宏观环境下 公司如何去平衡放款量增长和盈利能力这方面 谢谢管理层 接下来我会翻译 你好,管理层,谢谢你接受我的提问 我想知道公司国内业务的放款计划和目标是什么 我发现公司的放款增长比同业人的增长 稍稍快了 那么在将来的宏观环境下 公司如何能够维持放款增长 公司如何去平衡放款增长和盈利能力 这就是我所说的,谢谢, 好,谢谢Yada,我来回答一下这个问题 對,國內市場其實這幾年還是發生了一些變化,跟前幾年不太一樣 一個就是宏觀環境是比較疲弱,然後在整個消費金融市場當中 這個規模的增速也在放緩,行業進入一個相對比較成熟的階段, 尤其是去年下半年行业也出现了一些周期性的风险波动 我们也观察到业内的大家其实规模都也面临收缩的情况 所以在这样一个不确定的活动环境下 我们的策略是在这个不确定性当中 来寻找我们一个确定性的优势 来保持我们国内业务的一个可持续的发展 这是我们在国内的一个业务的发展的一个战略 那么具体来说我觉得这几个方面 一个就是在新客方面 因为我们在新客特别是信息流投放上 是一直是有这个数据和经验方面的一个确定性优势的 我们也不断地在持续优化这个相关的模型和算法 对我们的客户全市面的周期的价值进行更准确的一个预估 那這樣呢能保持我們在整個星客投放當中呢 是保持一個比較穩健的這樣的一個節奏 像上半年我們星客貢獻的成交額占比是提升了2% 然後同比也是有27%的一個增長, 所以从这一两年来看,我们鑫客投放上还是有足够的定点 我们的成交占比一直能够做到总体成交的12%到15% 因为鑫客只有保持这样的一个节奏 才能保持未来总体成交上的一个增长的这样的一个节奏 同时我们也能做好比较好的成本的一个控制 比较健康的一个LTBG 除了信息流投放以外呢,我們其實也在拓展一些新的方式,比如說今年上半年,我們也是跟多家越活用戶超過一級的平臺在合作,通過這些渠道來達成我們這個成交,那這個數字呢,同比也是有一個翻倍的這樣的一個表現。 然后呢我们也通过我们的品牌 去更多的影响我们的客户 比如说在奥运期间 我们是做过中国举重队的官方合作伙伴 大家知道中国举重队 其实在这次奥运周期上取得非常巨大的成功 所以我们在宣传中国奥运积极向上正能量的同时 我们也收获了曝光超过一个亿 传播量超过两千万的品牌宣传的效果 第二个是我们在老客户经营上面,这也是我们一个比较优势的一个方面,因为我们有17年的运营历史,所以我们对我们的客户非常了解。 通過深入挖掘用戶的需求 多層自差異化地去滿足他們的借款需求 然後基於場景、肖像和行為 來給他們提供最匹配的產品 合適的定價以及相關的優惠措施 通过精细化的应用手段 为我们的用户提供 个性化和高价值的服务, 上半年呢 从效果来看 我们这个老科的营销的分析效果是同比有一个36%的提升 所以也能帮助我们在这个成交当中啊 这个老科的这个成交占比是一个这个持续的一个提升 第三个是我们整体的业务健康度 我们一直是非常有优势的 在风险波动的情况下 我们基本上能保持一个稳健的风险水平 也不断通过资金成本的优化 使我们的take rate呈现一个向好的优化趋势, 所以总的来说就是通过坚定的这个新科的投放 深度的老科挖掘 以及保持領先的業務健康水平 使我們能夠在保證高質量的情況下 持續取得領先的增長的能力 能使我們業務保持一個長期的 可持續的發展, Hello Yada, let me do the translation for Alexa 如您所知,中国市场出现了一些变化。 这一年是非常不一样的 目前,中国的消费市场的增长速度已经慢下来,进入了增长竞争的阶段。 After the physical risk fluctuation in the industry during the second half of 2023, many players have experienced varying degree of loneliness.

Cindy Wong: Indonesia online operations will remain stable, with credit risk, customer acquisitions improving consistently.

Yada Li: Under the uncertain macro-environment, we are searching for certainty that is beneficial for us and execute sustainable development in China.

Cindy Wong: For offline operations, we have completed the acquisition of a multi-finance license, with a controlling stake of 83.7%.

Yada Li: We have a few ways to achieve that.

Cindy Wong: Going forward, we will proactively explore both online and offline China's multi-products, and buy now, pay later installments for different scenarios such as electronic and electric bikes, etc.

Yada Li: First of all, we have certainty for success on acquiring new borrowers through information feeds, leveraging on data and behavior. We continue to optimize the information feeds China and improve the algorithm, and conduct joint modelling to enhance our, We are able to increase the accuracy in determining the lifetime value of our customers and maintain stable customer acquisition strategy.

Cindy Wong: We will fully leverage our China expertise, and leverage them in our Indonesia market to ensure future growth.

Operator: Thank you all and have a nice day.

Alexi: What has been the key drivers behind?

Unknown Executive: Thank you all, and have a nice day.

Yada Li: Transaction volume contributed by new borrowers was up 2% and 27% year-over-year.

Cindy Wong: Hello, Cindy.

Alexi: What's the outlook for the second half?

Yada Li: Our percentage of new customers was between 12 to 15 percent.

Operator: This concludes this conference call.

Cindy Wong: Any more questions from you?

Alexi: And is there any more room for improvement for the funding cost?

Yada Li: At the same time, we are able to have better cost control and a healthy LGB level.

Cindy Wong: No more questions from me.

Alexi: 谢谢X,我来回答一下这两个问题 第一个关系,关于我们的整个资产质量 其实从我们去年大概三季度左右 在出现一些风险波动的初始阶段 我们就有一些判断 因为其实我们在这方面 还是经历过很多这样的一个周期 是非常有经验的 所以对这个趋势是会有个预判 虽然那时候没有太多数据表现 但是我们就即使也对高负债高风险的人群 做了风险策略相关的一个收紧 然后对中间那些风险的人群 也进行了一个差异化的一个策略 所以在预期上升的初期 能够快速地进行一个策略边界的调整 所以在今年一季度 其实我们就比较成功地扭转了 整个风险上升的趋势 应该说是行业中 最早能够控制住风险的平台, 然后二季度呢我们就持续进一步做优化 那比如说在整体框架下进行迭代 丰富额度体系 在对不同的这个类型去给它的这个额度的频率啊 幅度啊 去给出更优的这样的一个解决方案 所以在能夠保持成膠量 有一定增長的情況下 精細化的封控能夠展現出相應的效果, 數字方面之前也給大家報告過了 我們二季度整體的逾期率是穩定在2.5左右 各項早期的分析指標是出現了趨勢向好 現在能看到的這個Dayway已經下降了10個bips到5.1 回緩率其實是有一個比較明顯的提升到88 那最新的一些數據我們看到這個趨勢還是保持住 還在持續向後, 然後 下半年會不會發生這個類似的情況,我們覺得可能性不大,因為總體現在的趨勢還是一個比較向好的這樣一個情況。 然后然后额外可以分享一点的就是说因为在过去我们其实有17年的这个经营历史了 其实类似的这种这个资产质量的一个波动啊 其实也出现过多次啊 在我们有记录当中至少有四次 所以这其实也是一个业务当中的一个比较正常的一个周期的一个表现吧, 那像这种波动里面,这个一般持续四五个月,最长的有七个月,最短的是两个月,所以去年下半年呢,在这个当中总体应该是属于一个持续时间中等,也相对比较较小的这样的一个周期的变化。 然后从我们历史经验来看呢 一般四五个月左右都会出现修复啊 所以这次也不算是一个特别特殊的一个情况 而且现在也看到了已经恢复的迹象, 所以我们倒不是特别担心这样的一个变化 而且我们在过去应对上有非常成功的丰富的这样一个经验, Hello Alex, let me do the translation.

Yada Li: Selain daripada menghantar maklumat kepada Cina, kami juga beragama mengagumkan penghantaran pelanggan kita kepada Cina dan telah menemui pelbagai pasangan platform internet yang baru untuk bekerjasama dengan kami.

Cindy Wong: Hello.

Alexi: Regarding our overall asset quality...

Yada Li: Selain itu, kami juga berpengaruh pada jenama kami untuk mempengaruhi jalan bola kami.

Cindy Wong: Thank you.

Alexi: During the initial stage of the restoration last year, we leveraged on our years of experience and pre-emptively accurate predictions of the industry trends.

Yada Li: 例如,在奥运期间,我们对国家重量级体育团队的支持 获得了巨大的成绩,加上赢得赛事赢得, Bersama dengan mempromosikan gambar positif untuk Olimpik China, kami juga mendapatkan keputusan yang luar biasa dengan lebih daripada 100 juta penonton dan lebih dari 20 juta penghantaran video.

Cindy Wong: Thank you.

Alexi: Titan Approval Rates for Riskier Balloons, Higher Debt, Higher Risk, and Exploit Different Strategies for Medium Risk Groups, and quickly adjust the boundary strategies during the early stages of delinquency.

Yada Li: 第二,继续收入管理对我们来说是一种确定 我们已经有超过17年的经营经验, And we are very familiar with our followers through deeply excavating their diversified multi-layers and differentiated requirements.

Unknown Executive: This concludes this conference call. Thank you for joining.

Yada Lee: And our next question will come from Yada Lee of CICC.

Alexi: 在第一季度,利息表現穩定,我們是業界最早的平台,能夠在低層保留利息。 第二个半月内,我们继续调整、调整、调整 整体的信用限制,并探索各种用户的解决方案 维持交易量增长和平衡利润, And we have also shared that during the second quarter, our vintage delinquency remained stable at 2.5%, while day one delinquency reduced by 10 basis points to 5.1%, and loan collection recovery rate improved to 88%.

Yada Li: We will then refer them with the most suitable product based on, 不同的情境,例如用戶專頁和行為特徵, Dan semua ini telah menyebabkan kita meningkatkan kesan promosi penggunaan kita dengan 36% pada bahagian pertama yang menyebabkan lebih banyak transaksi untuk penggunaan berulang kali.

Operator: This concludes this conference call.

Yada Lee: Please go ahead.

Alexi: Dan kami tidak berfikir bahawa keadaan ini akan berlaku di bahagian kedua kerana persekitaran yang lebih stabil sekarang.

Speaker Change #215: This concludes this conference call. Thank you for joining you may now disconnect your line.

Yada Li: Ketiga, operasi perniagaan kita tetap sihat dengan stabil. 加上不断增加资金费用的增长, 导致多方资金的进一步增长, 如, 这些都保证了我们的高质量投资 which is above the industry and laid the cornerstone for sustainable growth going forward.

Yada Lee: Hello, Yada.

Alexi: Saya ingin berkongsi dengan anda, ingin berkongsi lebih banyak maklumat dengan anda.

Yada Li: OK, thank you, Yada.

Operator: Thank you for joining.

Yada Lee: Thank you for the opportunity to ask this question.

Alexi: Selama 17 tahun yang lalu dalam sejarah operasi kami, pencapaian sejarah industri dalam kualiti aset telah berlaku empat kali.

Yada Li: 好 謝謝各位, Okay.

Unknown Executive: You may now disconnect your line.

Operator: You may now disconnect your line.

Yada Lee: I would like to ask whether the company has a long-term growth plan and goal for domestic business payments.

Alexi: Such fluctuations on average last around 4-5 months, with the longest lasting 7 months and the shortest lasting 2 months. The fluctuation for this round is considered to be mid-term and the impact of fluctuation is smaller, based on past recovery experience.

Operator: Thank you, Yada.

Yada Lee: In comparison to the same industry, we see that the company's current payment growth rate is relatively fast.

Alexi: Proses pemulihan biasanya berlaku di antara 4 hingga 5 bulan Oleh itu, fluktuasi kali ini tidak unik dan telah menunjukkan tanda pemulihan, and we are competent to handle any more of such fluctuations in the future based on our experience.

Operator: Thank you.

Yada Lee: Is there any hope of maintaining it in the future?

Alexi: 第二個問題關於我們這個take away 二季度我們 我猜測一下 我們在定價方面就保持平穩 百分之22.2的 這個定價, 然后资金成本是一个季度有90个bps的一个优化 风险基本上稳定在2.5 所以总的一个take away 我们在相比上个季度的一个基础上是有所提升 到3.1左右 然后下半战展望呢 我们觉得定价还是能够保持相对平稳, 然后风险呢现在是有向好的趋势 然后资金成本 资金成本可以看到上半年 其实整体优化力度还是非常大的 但下半年我觉得这么大的力度可能不大会 但是还是继续有一定的这个优化的一个空间 所以我们预计整个这个take away应该是能够稳定在3%以上 有一定的这个上升的一个空间 對 資金成本再highlight一下 就是我們今年一季度 二季度加起來 應該總體資金成本是下降了140個bps 這在歷史上也是非常非常多的這樣一個水平, 然后为什么能够做到这个资金成本的一个下降呢,我觉得一方面就是我们整个资产在现在这个环境里面还是在市场上非常受欢迎的 另外我們也是少數繼續能夠保持增長的平台 所以我們在跟機構的合作當中 其實也有更多的定價的話語權, 所以就保证我们这个资金成本上是出现了一个比较大幅的一个优化的一个情况, Hello, Alex.

Operator: And again, if you would like to ask a question, please press star, then 1.

Yada Lee: And in the current environment, how does the company balance payment growth and privacy?

Alexi: Let me do the translation.

Operator: And our next question today will come from Alexi of UBS.

Yada Lee: Thank you, Yada.

Alexi: Regarding take rate, during the second quarter, our average borrowing rates remained stable at 22.2%. Funding costs optimised by 90 bps in the second quarter, while vintage delinquency remained stable at 2.5%. And take rate further improved to around 3.1%.

Alexi: Please go ahead.

Yada Lee: Then I will do the translation.

Alexi: Untuk separuh kedua tahun 2024, kami mengharapkan harga penerbangan biasa akan tetap stabil dan pelaburan pendanaan dan penerbangan vintaj akan mempunyai pemotongan yang lebih lanjut.

Alexi: 管理层好,感谢给我提问的机会,第一个问题关于资产质量的,那我们也关注到资产质量的前行指标在二季度都有一个持续的改善一下,请问一下这背后的一个主要的驱动力是什么,然后,比如说七八月我们目前看到的一个趋势是怎么样的,是不是需要担心下半年会再有一个类似于去年三季度那样的一个行业性,资产质量恶化的一个趋势, 影响,然后第二个是关于可以给我们就是二季度的一个环比的一个变化,然后对于下半年的展望,以及这个资金成本还有多少下降的空间。 So, my first question is on asset quality.

Yada Lee: Hello, management.

Alexi: 我们的资产质量在这样的环境下很受欢迎 我们是其中几个能够继续增长的平台 这就是为什么我们有更多的空间 和我们的资金伙伴商谈更多的资金费用, Funding cost has accumulated improved by 140 basis points in the first half of the year, and improved by 90 basis sequentially 未来,我们仍然认为,根据我刚才所说的,我们将有足够的进步空间。 OK, thank you, guys.

Alexi: So, we have noted that early indicators have claimed to improve in the second quarter.

Yada Lee: Thank you for taking my questions.

Operator: OK, thank you.

Alexi: Just wondering what are the key drivers behind a recent trend?

Yada Lee: And I was wondering, what's the plan and the growth target for the company's domestic business?

Operator: As there are no further questions now, I'd like to turn the call back over to the company for closing remarks.

Speaker Change #215: Yeah.

Alexi: And should we be worrying about any potential uptick in NPR in the second half, like in the third quarter last year?

Yada Lee: And I've noticed that the company has gained a slightly faster volume growth compared with the peers.

Operator: Terima kasih sekali lagi kerana menyertai kami hari ini.

Speaker Change #215: [music].

Yada Lee: And looking ahead, how likely the company can maintain such growth, and how does the company balance the volume growth and profitability?

Operator: Sekiranya anda mempunyai soalan yang lebih lanjut, silakan hubungi Timbalutions Group Team Perhubungan Investor.

Yada Lee: That's all.

Operator: Terima kasih dan selamat hari yang indah.

Yada Lee: Thank you.

Yada Lee: 谢谢亚达,我来回答一下这个问题。 国内市场其实这几年还是发生了一些变化,跟前几年不太一样。 一个就是宏观环境是比较疲弱,然后在整个消费金融市场当中,规模的增速也在放缓,行业进入一个相对比较成熟的阶段。 尤其是去年下半年,行业也出现了一些周期性的风险波动, 我们也观察到业内的大家其实规模都也面临一个收缩的情况。 所以在这样一个不确定的宏观环境下,我们的策略是在这个不确定性当中来寻找我们一个确定性的优势, 来保持我们国内业务的一个可持续的发展,这是我们在国内的一个业务的发展的一个战略。 那么具体来说,我觉得这几个方面,一个就是在新科方面, 因为我们在新科,特别是信息流投放上是一直是有这个数据和经验方面的一个确定性优势的, 我们也不断地在持续优化这个相关的模型和算法, 对我们的客户全市面的周期的价值进行更准确的一个预估, 那这样来能保持我们在整个新科投放当中来是保持一个比较稳健的这样的一个节奏。 像上半年我们新科贡献的成交额占比是提升2%, 然后同比也是有27%的一个增长, 所以从这一两年来看,我们新科投放上还是有足够的地点, 我们的成交占比一直能够做到总体成交的12%到15%, 因为新科只有保持这样的一个节奏, 才能保持未来总体成交上的一个增长的这样的一个节奏, 同时我们也能做好比较好的成本的控制, 比较健康的一个LTV水平。除了新系统投放以外, 我们其实也在拓展一些新的方式, 比如说今年上半年我们也是跟多家热火用户超过一级的平台在合作, 通过这些渠道来达成我们的成交, 这个数字同比也是有一个翻倍的这样的一个表现, 然后我们也通过我们的品牌去更多的影响我们的客户, 比如说在奥运期间,我们是做过中国举重队的官方合作伙伴, 大家知道中国举重队在这次奥运周期上是取得非常巨大的成功, 所以我们在宣传中国奥运积极向上正能量的同时, 我们也收获了曝光超过一个亿, 传播量超过2000万的品牌宣传的一个效果。 第二个是我们在老客户经营上面, 这也是我们一个比较优势的一个方面, 因为我们有17年的运营历史, 所以我们对我们的客户非常了解, 通过深入挖掘用户的需求, 去多层次差异化的去满足他们的借款需求, 然后基于场景、肖像和行为来给他们提供最匹配的产品, 合适的定价,以及相关的一些优惠的措施, 通过精细化的应用手段, 为我们的用户提供个性和高价值的服务。 上半年来从效果来看, 我们老客的营销的增益效果是同比有一个36%的提升, 所以也能帮助我们在成交当中, 老客的成交占比是一个持续的提升。 第三个是我们整体的业务健康度, 我们一直是非常有优势 在风险波动的情况下, 我们基本上能保持一个稳健的风险水平 也不断通过资金成本的优化, 使我们的take rate呈现向好的优化趋势 所以总的来说, 就是通过坚定的新客投放 深度的老客挖掘, 以及保持领先的业务健康水平 使我们能够在保证高质量的情况下, 持续取得领先的增长的能力 使我们的业务保持一个长期的, 可持续的发展 你好 亚达, 让我来翻译给Alexis听听 正如你所知, 中国市场在今年有些变化 这与去年相当不同, 目前中国的消费市场的水平 正在越来越低, 进入随着竞争的阶段 经过2021年第二半的, 业务风险波动 许多游戏者都体验到了, 渐渐减少的风险 在不确定的环境下, 我们在寻找 对我们的有利确证, 以维持中国的持续发展 我们有几个方法来实现, 第一 我们有确定的成功, 与新游戏者的资料费 与行为资料的优势, 我们继续改良中国的资料费 更改产品的方法, 进行互联网模拟 以提高我们的财务质量, 我们能够增加 我们客户的生命价值, 保持稳定的客户购买策略 新游戏者的交易量, 以2%增加 以至于27% 一年之内 新游戏者的百分比, 是12%至15% 同时, 我们能够有更好的价格控制 以及健康的LGBT层次, 除了中国的资料费 我们还在活跃地, 互联网购买我们的客户 并且找到了, 多个新的互联网平台 与我们合作, 此外 我们还在利用我们的品牌, 来影响我们的债务 例如, 在奥运期间 我们的支持, 为国家重量体操队 获得了巨大的成功, 加上他们在奥运中的胜利 加上为中国奥运会, 推广一个正面的图像 我们也获得了, 超过100万的观看次数 以及超过20万的视频, 交通通知数量 第二, 我们的重新收购 管理是一个确定, 我们的经历 有超过17年的经营历史, 我们对于收购者 非常熟悉, 通过深入地挖掘 他们的多层次, 以及不同的需求 我们会, 与他们提供 最适合的产品, 根据不同的情况 例如, 使用者的身份证 以及行为特征, 这一切 使我们增强了, 使用者的宣传影响 在第一半的36% 这就导致了 重新收购的, 交易量增加 第三, 我们的商业运营 仍然健康, 与稳定, All these ensure our high-quality growth, which is above the industry, and lay the cornerstone for sustainable growth going forward.

Yada Lee: 再次感谢你,Yada.

Yada Lee: 再次感谢你,Yada.

Yada Lee: 好的,谢谢你。 如果您想要问一个问题的话,请点击**,然后点击1。 接下来的问题,今天来自UBS的Alexi。请进来。 管理层好,感谢给我提问的机会。 第一个问题关于资产质量的,那我们也关注到资产质量的清新指标在二季度都有一个持续的改善。 请问一下这背后的一个主要的驱动力是什么?

Alexi: 所以我的第三个问题是关于资产质量的,我们也注意到资产质量的清新指标在二季度有一个持续的改善。 请问一下这背后的一个主要的驱动力是什么?

Alexi: 还有最近的趋势,我们是不是需要担心在二季度上的NPR上有可能有一个上升?

Alexi: 比如说在去年三季度那样。 然后第二个问题是关于take rate的一个停滞趋势, 在二季度上有没有更多的改善,更多的空间,更多的改善?谢谢。 所以在今年一季度我们就比较成功地扭转了整个风险上升的趋势,应该说是行业中最早能够控制风险的平台之一。 然后二季度我们就持续进一步做优化,比如说在整体框架下进行迭代,丰富额度体系,在对不同的类型去给它的这个额度的频率幅度去给出更优的这样的一个解决方案。 所以在能够保持成交量,有一定增长的情况下,精细化的这个风控其实能够展现出相应的效果。 數字方面之前也給大家報告過了, 我們二季度整體的預期率是穩定在2.5左右 各項早期的分析指標是出現了一個趨勢向好, 現在能看到的這個Dayway已經下降了10個bips到5.1 回還率其實是有一個比較明顯的提升到88, 最新的一些數據我們看到這個趨勢還是保持住 還在持續向好, 然後下半年會不會發生這個類似的情況 我們覺得可能性不大, 因為總體現在的趨勢還是一個比較向好的情況 然後額外可以分享一點就是說, 因為在過去我們其實有17年的經營歷史 其實類似的這種資產質量的波動, 其實也出現過多次 我們有記錄當中至少有4次, 所以這其實也是一個業務當中的一個比較 正常的一個週期的表現, 那像這種波動裡面 一般持續四五個月, 最長的有七個月 最短的是兩個月, 所以去年下半年在這個當中 總體應該是屬於一個持續時間中等, 相對比較較小的這樣的一個週期的變化 然後從我們歷史經驗來看, 一般四五個月左右都會出現修復 所以這次也不算是一個特別特殊的情況, 而且現在也看到了已經恢復的跡象 所以我們倒不是特別擔心這樣的一個變化, 而且我們在過去應對上 有非常成功的豐富的經驗, Hello Alex, let me do the translation.

Alexi: Regarding our overall asset quality, during the initial stage of the risk operation last year, we leveraged on our years of experience and preemptively accurate predictions of the industry trends, tightened approval rates for riskier bonds, higher debt, higher risk, and deployed different strategies for medium risk groups and quickly adjusted boundary strategies during the early stages of delinquencies.

Alexi: And in the first quarter, risk performance stabilized and we are one of the earliest platforms in the industry that are able to contain risk at a lower level. And during the second quarter, we further optimized, adjusted, and iterated on the overall credit limit and explored solutions for different types of users while maintaining growth in transaction volume and balancing risk. And we have also shared that, during the second quarter, our vintage delinquency remained stable at 2.5% while day one delinquency reduced by 10 basis points to 5.1% and loan collection recovery rates improved to 88%.

Alexi: And we don't think this situation will happen, in the second half as the overall environment is much more stable now.

Alexi: I would like to share more information with you.

Alexi: Over the past 17 years in our operating history, industry-wide fluctuations in asset qualities have occurred four times. And such fluctuations on average, last around four to five months with the longest lasting seven months and the shortest lasting two months. The fluctuation for this round, is considered to be mid-term and the impact of fluctuation is smaller based on past recovery experience.

Alexi: The recovery process normally takes place at between the 4th to 5th month.

Alexi: Therefore, the fluctuation this time round is not unique, and has already shown signs of recovery, and we are competent to handle any more of such fluctuations in the future, based on our experience.

Alexi: 第二个问题关于我们的take-away,我猜测一下,我们在定价方面就基本上保持还是平稳,22.2%的定价国内的。资金成本是一个季度有90个bps的优化,风险基本上稳定在2.5,所以总的一个take-away我们在相比上个季度的基础上是有所提升,到3.1左右。 然后下半年展望,我们觉得定价还是能够保持相对平稳,然后风险现在是有向好的趋势,然后资金成本可以看到上半年其实整体优化力度还是非常大的,下半年我觉得这么大的力度可能不大会,但是还是继续有一定的优化的空间,所以我们预计整个take-away应该是能够稳定在3%以上,有一定的上升的空间。 Hello, Alex, let me do the translation. Regarding take rates, during the second quarter, our average borrowing rates remained stable at 22.2%. Funding costs optimized by 90bps in the second quarter while vintage delinquency remained stable at 2.5%, and take rates further improved to around 3.1%.

Alexi: For the second half of 2024, we expect average borrowing rates will remain stable and funding costs and vintage delinquencies to have further optimization.

Alexi: Our asset quality is popular in such environment and we are one of the few platforms that are able to maintain growth.

Alexi: This is the reason why we have more room to negotiate for better funding costs with our funding partners. Funding costs have accumulated improved by 140bps during the first half and improved by 90bps sequentially. And going forward, we still believe it will have room for improvement based on what I have just said earlier.

Alexi: Okay, thank you, Alex.

Alexi: Okay, thank you.

Yada Li: [inaudible] Hello, Yada.

Yada Li: Let me do the translation for Alexis. As you know, China market has some changes this year and it is very different from the previous year. Currently, the scale of China's consumer market has slowed down and entered into the stage of increased competition. After the fiscal re-structuration in the industry during the second half of 2023, many players have experienced very deteriorated reduction.

Yada Li: Under the uncertain macro environment, we are searching for certainty that is beneficial for us and execute sustainable development in China. We have a few ways to achieve this. First of all, we have certainty for success on acquiring new borrowers through information fees, leveraging on data and behaviour. We continue to optimize the information fees China and improve the algorithms and conduct joint modeling to enhance our minds. We are able to increase the accuracy in determining the lifetime value of our customers and maintain stable customer acquisition strategy.

Thiagen Lee: Customer acquisition is a key element of our legal strategy. We view it as an ongoing investment that will ultimately lead to a higher percentage of better quality, repeat borrowers and drive sustainable growth.

Thiagen Lee: During the second quarter, our number of total new borrowers reached 8.2 billion R&B and 23.2 billion R&B up 22% year over year and 15% sequentially.

Yada Li: Transaction volume contributed by new borrowers was up 2%, and 27% year over year. A percentage of new customers was between 12-15% at the same time. We are able to have better cost control and a healthy LCD level. Apart from information fees China, we are also actively diversifying our customer acquisition China and have found multiple new internet platform partners to work with us. In addition, we are also leveraging on our brand to influence our borrowers.

Thiagen Lee: While updating our ability to grow our business across different countries, notably, as we completed the transition to better quality borrowers in Indonesia and began to diversify our business model.

Thiagen Lee: The percentage of new international borrowers, once again, surpassed the percentage of new China borrowers.

Yada Li: For example, during the Olympics period, our support for the national weightlifting teams has achieved tremendous success along with their wins at the Games. Along with promoting a positive image for China Olympics, we have also gained remarkable results of over 100 million views and over 30 million accounts of video traffic transmission.

Thiagen Lee: Furthermore, our number of new borrowers in the Philippines continue to grow robustly in the second quarter, increasing by 1.198 per cent year over year and 6.69 per cent sequentially.

Yada Li: And secondly, the management of repeat borrowers is a certainty for us and we have over 17 years of operating history and we are very familiar with our borrowers. Through excavating the diversified multi-layers and differentiated requirements, we will then refer them with the most suitable product based on different scenarios such as user profiles and behavior characteristics. And all these have lead us to increase our users' promotion impact by 36% in the first half, which leads to a higher transaction volume for repeat borrowers. Thirdly, our business operations remain healthy with stable support, with continuous improvement in funding costs, which leads to progressive improvement on multiple funds such as Tigrid.

Thiagen Lee: Our effective social media strategy in the international market also continue to yield positive outcomes. As of the end of the second quarter, our followers on leading social media platforms such as Facebook, TikTok, Instagram had risen to a problem in the 1.3 meeting, 850 solid and 240 solid, up 41% 30% and 8% year over year respectively.

Thiagen Lee: While updating the strong brand of our needs of deep localization, we have created our overseas, market.

Thiagen Lee: As a theme-type leader, technology is deeply engraved in our DNA.

Thiagen Lee: It remains the core of our business and our primary competitive age during the second quarter.

Thiagen Lee: We halted an internal-type competition called Haixong, bringing together six R&D teams for a 36-hour session in a color-style environment.

Thiagen Lee: Venom projects included admin AI bots, which can incorporate API function calls into larger language models. Its framework can also be expanded to include multiple internal tools and support the management of different tools across platforms.

Thiagen Lee: Another standard is sound.

Yada Li: All these ensure our high quality growth, which is above the industry and lead the cornerstone forward, sustainable growth going forward.

Yada Li: Okay, thank you, Yada Li, Tiezheng Li. Okay. Thank you, Yada. Thank you.

Thiagen Lee: Leverage A-A-G-C to utilize fragmented time slots to increase productivity. We believe this project demonstrates great implementation potential for enhancing our operations and overall efficiency.

Thiagen Lee: Next, I'd like to share some updates on our ESG progress. We recently published our 2023 ESG report, the six in our company's history, highlighting our dedication to transparency and sustainability.

Thiagen Lee: In 2023, we launched our mission of leveraging innovative technologies to make financial service better, as well as our ESG strategy centered on technology, green principle, and candidates.

Thiagen Lee: In addition to giving back to society with innovative technologies, the evolution and precise integrity and compliance, low-carbon development, and harmonies relationships with employees, partners, and communities in its ESG management efforts.

Unknown Executive: And again, if you would like to ask a question, please press star, then one.

Alexi: And our next question today will come from Alexi of UBS. Please go ahead. The indicators have been improved in second quarter. Just wondering what are the key drivers behind and the recent trend. And should we be worrying about any potential uptake in PR in second half, like in third quarter last year? And second question is on the sequential trend on the takeaway. What has been the key drivers behind? What's the outlook for second half? And it's improvement for the funding cost. Thank you.

Alexi: [inaudible][inaudible] The recovery process normally takes place at between the 4 to 5 months. Therefore, the fluctuation this time round is not unique and has a riddance shown signs of recovery. And we are competent to handle any more of such fluctuations in the future based on our experience. [inaudible] The takeaway is about the takeaway. The takeaway is about the takeaway.

Thiagen Lee: Moreover, we continue to spot small business owners through the second quarter's challenges.

Thiagen Lee: During the second quarter of 2023, we accumulated with several around 415,000 small business owners and facilitated 14.2 billion RMB of loans to neutral their dreams.

Thiagen Lee: I also want to highlight our long-standing cooperation with the national weightlifting team and congratulate them on their recent wins at the Paris Olympics.

Thiagen Lee: We are proud to promote awareness of the sports alongside the team and leverage their public image to help small business owners increase their product sales.

Alexi: Hello, Alex, let me do a translation. Regarding takeaway, during the second quarter, our average borrowing rate remains stable at 22.2%. Funding costs optimized by many beats in the second quarter while vintage didn't consume remains stable at 2.5% and take great further improved to around 3.1%.

Alexi: For the second half of 2024, we expect average borrowing rates to remain stable and funding costs and vintage didn't consist to have further optimization. Our asset quality is popular in such environment and we are one of the few platforms that are able to maintain growth. This is the reason why we have more room to negotiate for better funding costs with our funding partners. Funding costs has accumulated improved by 140 basis points in the first half and improved by 90 basis sequentially.

Alexi: And going forward, we still believe it will have room for improvement based on what I have just said earlier. Thank you. Okay, thank you, S. Okay, thank you.

Unknown Executive: As there are no further questions now, I'd like to turn the call back over to the company for closing remarks. Thank you once again for joining us today. If you have any further questions, please feel free to contact the Impregutions Group Investor Relations team.

Unknown Executive: Thank you all and have a nice day.

Unknown Executive: This concludes this conference call. Thank you for joining.

Thiagen Lee: Our joint initiatives embody our shared entries of the Olympic vital of excellence, respect, and friendship, helping to create a better society for all.

Thiagen Lee: We will continue to integrate ESG management throughout our business operations and partnerships providing sustainable development across the industry.

Unknown Executive: You may now disconnect your line.

Thiagen Lee: Before we move on to our Seattle's review of operational and financial metrics, I'd like to share that the evolution celebrates a 17th anniversary during the second quarter, a milestone that inspires us to look towards our sustainable future.

Thiagen Lee: As such, we cite our vision for 2030.

Thiagen Lee: So become an international theme type platform, connecting forwards in the financial institutions across multiple global markets, and leading the industry in each of them.

Thiagen Lee: We will remain dedicated to leveraging innovative technology to make financial service better and a greener, so significantly providing the solutions long-term growth.

Thiagen Lee: To summarize, despite China's ongoing macro challenges, we successfully deployed our leading technologies and operations capabilities to achieve solid progress in the second quarter, across the other markets in which we operate.

Thiagen Lee: Going forward, as China's micro-environments improve, we are confident of resuming future growth and delivering consistent returns across multiple metrics for our stake holders.

Thiagen Lee: We decide.

Xiaoxiong Ye: I will now turn the call over to our CFO, Xiaoxiong Ye.

Xiaoxiong Ye: We will discuss our operational and financial results in great detail.

Xiaoxiong Ye: Thank you, Yada, hello, everyone.

Xiaoxiong Ye: Let's go through our key results for the second quarter.

Xiaoxiong Ye: To be mindful of the lens of our earnings core today, I encourage listeners to refer to our second quarter in this press release for further details.

Xiaoxiong Ye: Despite China's 5% GDP growth in the first half of 2024, uncertainty still persists in macro-environment.

Xiaoxiong Ye: Some more tricky items and tourism-related activities remain the bright sport with the main holiday.

Xiaoxiong Ye: Six-18 shopping festival and the consumption-related index all-shoring signs of improvement.

Xiaoxiong Ye: However, China's overall retail sales flow to 2% growth year-over-year in June, which did not reflect an optimal recovery trajectory.

Xiaoxiong Ye: China's manufacturing PMI index remained largely stable in July with manufacturing PMI holding steady at 49.4 points.

Xiaoxiong Ye: Concurrently, the manufacturing PMI and compensated PMI both reached 15.2 points, which is within the expansion range in the cutting Chinese and the price graduating production recovery.

Xiaoxiong Ye: In short, also China's economy is recovery.

Xiaoxiong Ye: There are still pockets of tuberous, which we will need to navigate using our vast experience and technological and operational process.

Xiaoxiong Ye: As we mentioned, our performance in the first half of the year were sorted with transaction volume growth in both China and the international market's lending within our guidance range.

Xiaoxiong Ye: This was supported by consistent excellence across numerous areas such as institution-infunding, loan collection, and the risk of unemployment among others.

Xiaoxiong Ye: Let me work you through some of the details.

Xiaoxiong Ye: During the second quarter, our average borrowing rate in China remains stable at RRA 22.2%, validating our strong commitment to advancing financial inclusion.

Xiaoxiong Ye: Given financial institutions growing desire to obtain good quality borrowers from our platform, our founding course improves significantly, shrinking another 90 beeps during the quarter and recording a cumulative improvement of 114 beeps in the first half of 2024, leading to consistent improvement in our T-grade.

Xiaoxiong Ye: Such a huge same annual improvement in funding course and scores by leisure institutions de-betrassing our credit risk assessment capabilities and our growing enhancement of the quality of our borrowers.

Xiaoxiong Ye: Given the quality of our borrowers and ample market and liquidity, we are confident of achieving continued improvement in funding course in the second half of the year.

Xiaoxiong Ye: Regarding risk management, the recovery economy and our annual adjustment to our credit risk assessment models drove progressive improvement in our day-to-day closing rate, which failed by 10 basis points equationally to reach 5.1 percent for the quarter.

Xiaoxiong Ye: For our vintage perspective, we maintain our view that vintage inequality will stabilize at around 2.5 percent.

Xiaoxiong Ye: By referring our responsive payment deduction strategy, we have enhanced the efficiency of our loan collection process, resulting in an improvement in our loan collection to cover rate to 88 percent.

Xiaoxiong Ye: Up to 200 basis points from the previous quarter. We expect this strong recovery momentum of loan collection will persist in the second half of the year.

Xiaoxiong Ye: Furthermore, as we continue to optimize our operations, we have strategically adjusted our business portfolio to adapt our partners in worry requirements.

Xiaoxiong Ye: For the first half of 2024 transaction volume for our international market, reached about 4.5 billion of 32 percent of the year to reach the upper range of our guidance.

Xiaoxiong Ye: Supported by the strong global micro-environment in our effective legal strategy, we believe our international business growth momentum is sustainable with further diversification among different business models.

Xiaoxiong Ye: Moving on to our international expansion efforts in the Indonesia, our first and largest overseas market has shown continued growth in its micro-economy throughout the first half of this year, with the recorded GDP growth of 5.05 percent for the second quarter and the targeted GDP growth of 5.2 percent for full year 2021.

Xiaoxiong Ye: The Indonesia consumer confidence index has risen high at about 120 percent for 18 months.

Xiaoxiong Ye: The volume of motorbike sales increased 26 percent year over year and 17 percent to 529,000 of July 2024 for data-streeting the nation's Beside a moderate correction to 149.3% in July 2004, Indonesia's manufacturing PMI has remained about 15% since September 2021, reflecting Yada's three consecutive years of sustained economic prosperity.

Xiaoxiong Ye: The unemployment rate decreased for the year over a year in March 2024 to 4.8% from 5.5% in the same period in the last year, further strengthening consumer's confidence.

Xiaoxiong Ye: After two quarters of business adjustment towards better quality spoilers under the new pricing cap, we're proud to share that we have stabilized our operations in Indonesia and continue to gain recommendation for local customers and other stakeholders.

Xiaoxiong Ye: These recommendation has attract new founding partners, including a leading local leader bank.

Xiaoxiong Ye: We are also steadily building and strengthening our relationships with larger and more vulnerable local financial institutions to diversify our founding sources, thereby optimizing founding costs.

Xiaoxiong Ye: Next, our second international market at the Philippines.

Xiaoxiong Ye: As of July 2004, its manufacturing PMI has remained about 15% for 11 consecutive months.

Xiaoxiong Ye: The Philippines' labor market is also exhibiting positive momentum.

Xiaoxiong Ye: With an employment rate dropping to 3.1% as of June 2024, around 4.5% compared to the same period last year.

Xiaoxiong Ye: For example, private consumption, consumption contribute to 17.2.5% of the Philippines nominal GDP in the second quarter of 2024, reflecting robust domestic amounts that will further support the nation's rapid economic growth.

Xiaoxiong Ye: Notably, our Philippines' operation continued to all perform expectations with the transaction volume growing 140% year-over-year and the 20% quarter of a quarter to IMB 600 and 74 million in the second quarter, representing 29% of the international transaction volume.

Xiaoxiong Ye: These outstanding performance reflects strong support from our local partners, such as C-bank, Union Bank, and Maya Bank.

Xiaoxiong Ye: Our latest founding partners, who recently partnered with us on a US 47-minute program.

Xiaoxiong Ye: With sufficient funding in place, we believe we can maximize the benefits of our e-commerce cooperation with TITTOK shop, acquire additional new borrowers from diversified channels, and sustain continued high growth rates.

Xiaoxiong Ye: Now, turning to our financial metrics.

Xiaoxiong Ye: These quarters, operation no extent needed to better than expected financial results.

Xiaoxiong Ye: Natural revenue for the quarter, which I am the 3.17 billion, up 3% year-over-year.

Xiaoxiong Ye: Our net income was on B-5 country and 51 million, a whole percent increased quarter-over-quarter.

Xiaoxiong Ye: Group, Xiaoxiong Ye, Thomas Chong, Tiezheng Li, Tiezheng Li, Thomas Chong, Tiezheng Li, Thomas Chong, Tiezheng Li, Thomas Chong,[inaudible] For the first half of 2004, we have deployed around the US 15, 7 million was shared repurchase Our total cumulative share repurchase amount reached the US 3,37 million as of the end of the second quarter In addition, our dividends has steadily increased over the past 4 years with the cumulative dividend amount reaching US 3,25 million in total Our capital return program has returned US 612 million to our shareholders, with a payout ratio rising to 49% of net profit in 2023 Going forward, we will continue to strengthen our capital return program for our shareholders In summary, our following the second quarter results showcase our legal strategies effectiveness Our nameable business model and our technological advantages, we expect our Indonesia operations to become profitable in 2024 and our Philippines operations to be contribute to profits in 2025 Boasting our confidence in deploying a more proactive international expansion strategy, as we capitalized on the massive opportunities in the international markets We look forward to delivering sustainable growth and sharing our success with all our stakeholders That concludes my preparatory remarks.

Operator: We will now open the corner to the questions.

Operator: Operators, please continue Thank you.

Operator: We will now begin the question and answer session.

Operator: To ask a question you may press star, then one, on your touch 10 cents If you are using a speaker phone, please pick up your handset before pressing the key.

Operator: If at any time your question has been addressed and you would like to withdraw your question, please press star then two.

Operator: For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, we ask that you please kindly repeat your question in English.

Operator: At this time, we will pause for a moment to assemble our roster.

Cindy Wang: Our first question today will come from Cindy Wang of China Renaissance.

Cindy Wang: Please go ahead.

Cindy Wang: Thank you for the opportunity to ask this question.

Cindy Wang: I have two more questions to ask.

Cindy Wang: The first question is to ask the Chinese market.

Cindy Wang: Could you please tell us about the changes that you have seen in the second part of the conversation?

Cindy Wang: And how do you see the situation in the next seven months?

Cindy Wang: The second question is to ask the Chinese market in English.

Cindy Wang: Because we know that you have been here for a long time.

Cindy Wang: So if you look at the current situation, how do you feel about the current situation?

Cindy Wang: Would you like to take a look at the situation in the second part of the conversation?

Cindy Wang: I am very happy to answer your question.

Cindy Wang: Thank you, management for taking my call.

Cindy Wang: And I have two questions here.

Cindy Wang: First question is, could you please add some color on the trend of your China borrower's long demand in second quarter and also in July?

Cindy Wang: And the second question is, the Indonesia, your customer acquisition strategy, after the APR meet the requirement.

Cindy Wang: And any updates on the regulation from the interest rate requirement in 2025.

Cindy Wang: Thank you.

Unknown Speaker: [inaudible] Hello, Cindy.

Unknown Speaker: Let me do the translation.

Unknown Speaker: Regarding China demand during the second quarter, the trend of how the borrowers demand is largely in line with the witness in residential credit demand.

Unknown Speaker: The daily application rate of repeat borrowers declined by a mid-singer digit, around 6% on an annual basis and quarterly comparison, reflecting with consumer confidence in July and August. We have observed that the application rate of our repeat borrowers has increased by mid-singer digit between 6% to 7%.

Unknown Speaker: On a daily basis, the demand of our borrowers is concentrated in the area of daily necessity. Therefore, when the economy is weak, it will show more resilience and we expect demand will gradually improve in the second half of the year.

Unknown Speaker: [inaudible] movement of our borrowers increased by mid-singer digit between 6% and 6% on a daily basis.

Unknown Speaker: The profit of our borrowers is 4.3 billion.

Unknown Speaker: The price of our borrowers increased by 50,000 to 50,000.

Unknown Speaker: In addition, the new customers increased by 20,000 to 39% on a daily basis.

Unknown Speaker: In addition, we have been working closely with our borrowers in July and August.

Unknown Speaker: Currently, our borrowers are basically the current borrowers of our borrowers.

Unknown Speaker: In addition, we have observed the demand of our borrowers in July and August on a daily basis.

Unknown Speaker: [inaudible] Xiaoxiong and other products, including Xie Ninhai, Changning Fengqi, and the two electric cars, and the combination of different types of products.

Unknown Speaker: Now, let's talk about the experience and capabilities in China.

Unknown Speaker: Let's talk about the experience and experience in the industry.

Unknown Speaker: Hello, Cindy.

Unknown Speaker: Let me do the translation.

Unknown Speaker: From Indonesia's maximum requirement, it is presenting a much more positive trend. After the Indonesia of election, right, political situation has normalized with an improving economy, such as GDP increase.

Unknown Speaker: And let us concentrate on the power performance.

Unknown Speaker: In Indonesia, during the second quarter, transaction volume for Indonesia market reach, 1.64 billion, up to about 6 to 7% annually without standing loan balance between 1.0 billion, up to about 4%.

Unknown Speaker: Revenue for the quarter reached 430 million.

Unknown Speaker: Number of borrowers reach, 530,000 up to 4% sequentially, and number of new borrowers reach.

Unknown Speaker: 200,000 up, 9% sequentially, we have cumulatively cooperated with 7 financial institutions, and all our findings is from local financial institutions now.

Unknown Speaker: Our Indonesia operations has complete its thriving transition in just 5 months, and we have made adjustments in borrowers' cohorts, modest iteration, and credit rates have improved by 28%, meaningfully, offsetting the impact of interest reduction. Therefore, our take rate returns to 10%, reflecting our business entering a more stable state.

Unknown Speaker: For the third quarter, in the second half of the year and for the third quarter, we expect Indonesia operations will be improved over 10%, with transaction volume potentially reaching new record high.

Unknown Speaker: Indonesia online operations will remain stable with credit rates, customer acquisitions, improving consistently, for offline operations.

Unknown Speaker: We have complete the acquisitions of a multi-financed license, with a controlling stake of 83.7%.

Unknown Speaker: Going forward, we will proactively explore both online and offline China's multi-products, and buy now-pay leaders' installments for differences now such as online and electric parts as such.

Unknown Speaker: We will fully leverage our China expertise and leverage them in our Indonesia market to ensure future growth.

Unknown Speaker: Hello, Cindy, any more questions from you?

Unknown Speaker: I have one more question for you.

Unknown Speaker: Hello, thank you.

Unknown Speaker: Thank you.

Yada Lin: And our next question will come from Yada Lin of CRCC.

Yada Lin: Let's go ahead.

Yada Lin: [inaudible] compared with the peers and the looking ahead, how likely the company can maintain such growth and how that will become the balance, the volume growth and profitability.

Yada Lin: That's all.

Yada Lin: Thank you.

Unknown Speaker: Thanks, Xiaoxiong Ye, Yada Li, I'll answer this question[inaudible] this question in a short time, I'll answer this question in a short time, I'll answer this question in a short time, I'll answer this question in a short time, I'll answer this question in a short time, I'll answer this question in a short time,[inaudible] I'll answer this question in a short time, I'll answer this question in a short time[inaudible] In the current situation, we have been able to maintain a stable and healthy diet, which we have been able to maintain.

Unknown Speaker: In the current situation, we have been able to maintain a stable and healthy diet, which we have been able to maintain.

Unknown Speaker: Hello Yada, let me do the translation for Alexis.

Unknown Speaker: As you know, China market has some changes this year, and it is very different from the previous year.

Unknown Speaker: And currently, the scale of China control market has slowed down and entered into the stage of increased competition.

Unknown Speaker: After the fiscal re-structuration in the industry during the second half of 2023, many players have experienced varying degree of total reduction.

Unknown Speaker: Under the uncertain macro environment, we are searching for certainty that is beneficial for us and execute sustainable development in China.

Unknown Speaker: We have a few ways to achieve this.

Unknown Speaker: First of all, we have certainty for success on acquiring new borrowers through information fees, leveraging on data and behaviour.

Unknown Speaker: We continue to optimize the information fees China and improve the algorithms and conduct joint modeling to enhance our line.

Unknown Speaker: And we are able to increase the accuracy in determining the lifetime value of our customers and maintain stable customer acquisition strategy.

Unknown Speaker: Transaction volume contributed by new borrowers was up to 2%, and 27% year over year.

Unknown Speaker: A percentage of new customers was between 12-15% at the same time.

Unknown Speaker: We are able to have better cost control and a healthy LCD level.

Unknown Speaker: Apart from information fees China, we are also actively diversifying our customer acquisition China and have found multiple new internet platform partners to work with us.

Unknown Speaker: In addition, we are also leveraging on our brand to influence our borrowers.

Unknown Speaker: For example, during the Olympics period, our support for the national weightlifting teams has achieved tremendous success along with their wins at the Games.

Unknown Speaker: Along with promoting a positive image for China Olympics, we have also gained remarkable results of over 100 million views and over 30 million accounts of video traffic transmission.

Unknown Speaker: And secondly, the management of repeat borrowers is a certainty for us, and we have over 17 years of operating history, and we are very familiar with our borrowers.

Unknown Speaker: Through excavating their diversified multi-layers and differentiated requirements, we will then refer them with the most suitable product based on different scenarios such as user profiles and behavior characteristics.

Unknown Speaker: And all these have led us to increase our users' promotion impact by 36% in the first half, which leads to a higher transaction volume for repeat borrowers.

Unknown Speaker: Thirdly, our business operations remain healthy with stable support, with continuous improvement in funding costs, which leads to progressive improvement on multiple funds such as Tigrid.

Unknown Speaker: All these ensure our high quality growth, which is above the industry and lead the cornerstone forward, sustainable growth going forward.

Unknown Speaker: Again, thank you, Yada.

Unknown Speaker: Thank you.

Operator: And again, if you would like to ask a question, please press star then one.

Alexine: And our next question today will come from Alexine of UBS.

Alexine: Please go ahead.

Unknown Speaker: [inaudible][inaudible] The recovery process normally takes place at between the 4 to 5 months.

Unknown Speaker: Therefore, the fluctuation this time around is not unique and has a riddance shown signs of recovery.

Unknown Speaker: And we are competent to handle any more of such fluctuations in the future based on our experience.

Operator: [inaudible] This concludes this conference call.

Operator: Thank you for joining.

Operator: You may now disconnect your line.