Q1 2025 X Financial Earnings Call
Operator: Hello and welcome to the X Financial first quarter 2025 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference operator by pressing star key followed by zero.
Hello, and welcome to the X financial first quarter 2025 earnings Conference call.
All participants will be in a listen only mode.
Should you need assistance, please signal our conference operator.
All of us here.
Operator: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1. To withdraw your question, please press star . Please note this event is being recorded.
After todays presentation, there will be an opportunity to ask questions.
To ask a question you May press Star then one.
To withdraw your question. Please press Star then two.
Please note this event is being recorded.
Victoria Yu: I would now like to turn the conference over to Victoria Yu, please go ahead. Thank you, Operator. Hello, everyone, and thank you for joining today's call.
Victoria: I would now like to turn the conference over to Victoria. Please go ahead.
Speaker Change: Thank you operator, Hello, everyone and thank you for joining today's call. The company's financial results were released earlier today and are available on our Investor Relations website IR they'll show you Dot com.
Victoria Yu: The company's financial results were released earlier today and are available on our Investor Relations website at ir.xiaoyinggroup.com.
Victoria Yu: On the call today from X Financial are Mr. Kan Li, President, Mr. Frank Fuya Zheng, Chief Financial Officer, and Mr. Noah Kaufman, Chief Financial Strategy Officer.
Victoria: The call today from X financial are Mr. Kelly.
Speaker Change: Mr. Frank <unk> Chief.
Speaker Change: Chief Financial Officer, and Mr. No Kaufman Chief Financial strategy Officer, Mr. Leave you'll start with a brief overview of our business profile and financial performance.
Kan Li: Mr. Li will start with a brief overview of our business progress and financial performance.
Noah Kaufman: Then Mr. Kaufman will go over some TQ-1 metrics and highlights.
Speaker Change: That needs to come that will go over some chi Q1 metrics and highlights after like Mr. Cheng will share updates held financial regulator, where you saw it in our 'twenty to 'twenty five outlook afterwards, Mr. Li Mr. Jang in at least a couple of months.
Frank Fuya Zheng: After that, Mr. Zheng will share updates on financials, regulatory insights, and our 2025 outlook.
Victoria Yu: Afterwards, Mr. Li, Mr. Zheng, and Mr. Kaufman will be available to answer your questions during the Q&A session.
Speaker Change: We'll be available to answer your questions during the Q&A session.
Victoria Yu: I remind you that this call may contain forward-looking statements under the Safe Harbor Prohibitions of Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and involve known or unknown risks, uncertainties, and other factors. These factors are difficult to predict and many are beyond the company's control, which may cause actual results, performance, or Further information on these and other risks can be found in our IPC filings.
I remind you that this call may contain forward looking statements and youre going to see copper pollution Private Securities Litigation Reform Act of 1995, such statements are based on management's current expectations and involve known or unknown risks uncertainties and other factors lease factor.
Speaker Change: It's difficult to predict and many are beyond the company's cash flow.
Speaker Change: We may cause which may cause actual results performance or achievements to differ materially from those described in these statements.
Speaker Change: Information on these and other risks can be found in our SEC filings.
Victoria Yu: The company undertakes no obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required by law.
Speaker Change: Company undertakes no obligation to update any forward looking statements as a result of new information future events or otherwise.
Speaker Change: As required by law.
Kan Li: It is now my pleasure to introduce Mr. Kan Li. Thank you Victoria and hello everyone. We are pleased with how 2025 has begun. In the first quarter we facilitated RMB 35.15 billion in loans and 8.8% sequential increase and 63.4% growth year over year. It was one of our strongest quarters for originations, reflecting solid borrower demand and continued progress in risk management. Our team remained focused on expanding opportunities through both new partnerships and existing relationships. enhancing our technology platform and underwriting models to support profitability and scalability. balancing growth and risk as we broaden access to qualified borrowers.
It's now my pleasure to introduce Mr. Kelly.
Speaker Change: Yeah.
Kelly: Thank you Victoria and Hello, everyone. We are pleased with our 2025 of that has to be come in the first quarter with the city to RMB 35 point to one 5 million in loans and eight 8% sequential increase and a 63.4% growth year over year. It was one.
Kelly: Our strongest quarters for origin or originations, reflecting solid borrower demand and the continued progress in risk management.
Kelly: Our team remains focused on expanding opportunities through both new partnerships and the existing relationships.
Kelly: Our technology platform and underwriting models to support profitability and scalability.
Kelly: Balancing growth and risk as we broaden access to quantify the borrowers.
Kan Li: We are also working to improve the borrower experience by delivering faster decisions, simplifying application processes, and enhancing transparency. In parallel, we continue to strengthen platform reliability and support tools to help customers make informed borrowing decisions and manage repayments with confidence. Despite the typical seasonal impact from Chinese New Year, we achieved sequential growth in both non-volume and revenue. Total revenue reached RMB 1.94 billion, up 13.4% from Q4, and over 60% year-over-year.
Kelly: We are also working to improve the borrower experience by delivering faster decision.
Kelly: Simplify application processes and enhancing transparency in parallel we continue to strengthen the platform the liability and the support tools to help customers make informed the borrowing decisions and manage independent and with confidence.
Kelly: Despite the typical seasonal impact from Chinese new year, we achieved a sequential growth in both known volume and our revenue total revenue reached RMB 194 billion up 13, 4% from Q4 and over 60% year over year. These results reflected a steady progress in growing the platform.
Kan Li: These results reflected steady progress in growing the platform responsibly.
Kelly: Responsibly.
Kelly: Operational and credit quality optics. We also made continued progress on quality as of March 31, or 31% to 60 day delinquency rate was $1, two 5% compared to 161% a year ago, reflecting the 20% to 22% improvement year over year.
Kan Li: Operational and Credit Quality Update. We also made continual progress on ad quality. As of March 31st, our 31 to 60 days delinquency rate was 1.25% compared to 1.61% a year ago, reflecting a 22% improvement year over year. The 91 to 188 delinquency rate was 2.7%, down from 4.7% in Q1 2024, a 37% reduction year-over-year. These improvements reflect disciplined borrower screening and underwriting practices. We have also continued to enhance borrower engagement and repayment behavior through timely communication and tailored repayment assistance programs. These initiatives have contributed meaningfully to our risk management outcomes and supported further portfolio stability.
Kelly: The 91 to 100 idea the delinquency rate was two 7% down from four 7% in Q1 'twenty than before.
Kelly: 737% reduction year over year.
Kelly: These improvements were pretty disciplined.
Kelly: Discipline and the borrower screening and underwriting practices. We have also continued to enhance borrower engagement and the repayment of behavior through timely communication and Pedro to repayment assistance programs.
Kelly: These initiatives have contributed meaningfully to our risk management outcomes and supported a further portfolio stability.
Noah Kaufman: Now I will turn the call to Noah to go over some key QA metrics and highlights. Yeah, thank you, Kent. Hello, everyone. It's a pleasure to speak with you today. Let me share several highlights from our Q1 operational and financial performance. On the operational metrics, we facilitated approximately 35.15 billion RMB in loan originations, marking a 63.4% year-over-year increase. Our total loan outstanding balance, excluding loans over 60 days delinquent, reached 58.4 billion RMB, growing by more than 33% from Q1 2024. We facilitated over 3.14 million loans with an average loan amount of approximately $11,181 RMB.
NOLA: Now I will turn the call to NOLA to go over some key Q1 metrics and highlights.
NOLA: Yeah. Thank you, Ken and Hello, everyone. It's a pleasure to speak with you today, let me share several highlights from our Q1 operational and financial performance on the operational metrics, we facilitated approximately 35.15 billion RMB and loan originations, marking a 63, 4% year over year.
NOLA: Increase our total loan outstanding balance excluding wounds over 60 days delinquent reached $58 4 billion RMB growing by more than 33% from Q1 2024.
NOLA: We facilitated over 3.14 million loans with an average loan amount of approximately 11181 RMB on the financial highlights.
Noah Kaufman: On the financial highlights Total Revenue grew to 1.94 billion RMB, up 13.4% sequentially. and 60.4% year-over-year, primarily driven by higher borrower volumes and originating Our income from operations expanded substantially, reaching 573 million RMB, up 52% year-over-year. This demonstrates our improved operational leverage and discipline expense management. Our average funding cost improved year over year, supported by a more optimized funding system. and Sustained Commitment from our core institutional This reflects the strength of our platform and deepening trust within our funding network. continue to see notable gains. and Operational Efficiency and Market Positions.
NOLA: Total revenue grew to 1.94 billion RMB up 13, 4% sequentially.
NOLA: And 64% year over year, primarily driven by higher volumes and originations.
NOLA: Our income from operations expanded substantially reaching 573 billion RMB.
NOLA: 52% year over year.
NOLA: This demonstrates our improved operational leverage and disciplined expense management.
NOLA: Our average funding cost improved year over year supported by a more optimized funding structure.
NOLA: And sustained commitment from our core institutional partners.
NOLA: This reflects the strength of our platform and deepening trust within our funding network.
NOLA: With these metrics.
NOLA: We continue to see notable gains in operational efficiency and market positioning.
Frank Fuya Zheng: I'll now hand the call over to Frank. Thank you all. It's great to speak with everyone today.
NOLA: I'll now hand, the call over to Frank to walk through the financials discuss capital allocation priorities provide regulatory insights and outline our growth outlook for 2025.
NOLA: Thank you.
Speaker Change: It's great to speak with everyone. Today I will provide additional insights into my probability matrix. It creates a strategic plan capital allocation not just net income reached RMB 467 billion increased 44, 9% year over year.
Frank Fuya Zheng: I will provide additional insights into our profitability metrics, liquidity and the strategic plans for the capital allocation. Non-GAAP adjusted net income for Q1, which RMB 467 million, increased 44.9% year-over-year, reflecting sustained earnings strength. Basic earnings per ADS improved significantly to USD 1.50. an approximately 45.6% year-over-year increase, underscoring enhanced profitability per share. Return on equity increased to 25.5%, rising 1.4% for... Points Year-over-Year, and 3.2 points sequentially. Reflecting our sustained financial discipline and the growing operation efficiency.
Speaker Change: Reflecting sustained strength.
Speaker Change: Basic earnings.
Speaker Change: It is improving significantly.
Speaker Change: USD one point 50.
Speaker Change: <unk>.
Speaker Change: Approximately $45.
Speaker Change: 6% year over year increase <unk> volumes.
Speaker Change: Volumes being has the possibility to push it.
Speaker Change: Return on equity increased to 25.5% why isn't one 4%.
Speaker Change: Year over year, and a three two points sequentially.
Speaker Change: Reflecting our sustained financial discipline.
Speaker Change: And that efficiency.
Frank Fuya Zheng: Our liquidity remains strong, position us well to support ongoing operations, investments, and capital returns. share repurchase plan. We have recently authorized a new share repurchase plan that allows us to buy back up to 100 million U.S. dollars worth of our Class A shares and ADAs. This new authorization comes in addition to our existing repurchase plan approved last December, which still has approximately 15.9 million remaining.
Speaker Change: Well it currently remains strong positioning us well to support ongoing operations investments and capital returns.
Speaker Change: Share repurchase plan.
Speaker Change: Recently.
Speaker Change: Otherwise a new share repurchase plan.
Speaker Change: All of us to buy back up to 100 million.
Speaker Change: U S class eight kids and idiots.
Speaker Change: It's also validation that will be effective for 18.
Speaker Change: <unk> 18 months' period running from January getting dailies <unk> plus 2025 through November 32026 this authorization.
Speaker Change: They shouldn't.
Speaker Change: The purchase plan.
Speaker Change: December which is still has approximately.
Speaker Change: 15 9 million remaining.
Frank Fuya Zheng: Regulatory Environment Update. The regulatory environment in China remains dynamic and we remain fully committed to compliance and align with the overall policy direction. The recent notice from the National Financial Regulatory Administration affirms the current trajectory with a clear focus on responsible credit assets and financial stability.
Speaker Change: Regulatory environment uptake.
Totally environment in China remains dynamic and we remain fully committed to compliance and align with pollo.
Policy direction.
Speaker Change: The reasons notice from the National financial regulatory administration.
Speaker Change: Okay.
Speaker Change: Third tragic trajectory with a clear focus on disposal so crazy.
Speaker Change: Financial stability, we see increased oversight as a positive step that will support long term industry get without them and then reflects growing recognition of all world.
Frank Fuya Zheng: We see increased oversight as a positive step that supports long-term industry development and reflects growing recognition of our role, while evolving rules may introduce high compliance requirements. They also create a space for innovation and more sustainable growth. We continue to engage proactively with regulators and remain focused on responsible execution and the enrolling framework.
Speaker Change: Well I can go over the rules may introduce high.
Speaker Change: Requirement.
Speaker Change: Also created space for innovation and more sustainable of course, we can.
Speaker Change: Turning to engage.
Speaker Change: It's literally.
Speaker Change: And we remain focused.
Speaker Change: Responsible execution.
Bobby.
20025 gross outlook based on current trends ex financial expect the total loan amount facilitated and Oregon in the second quarter of 2025 to be in the range at $37 5 billion to RMB 39, five did it.
Frank Fuya Zheng: 2025 Growth Outlook Based on current trends, X Financial expects a total loan amount facilitated and originated in the second quarter of 2025 to be in the to RMB 39.5 billion, reflecting continuous strong demand and consistent execution following a robust first quarter.
Speaker Change: Reflecting continued strong demand and consistent execution.
Speaker Change: With.
Kan Li: With that, I will pass the call back to our President, Kan Li, for closing remarks. Thank you, Frank. As we progress through 2025, we remain confident in our strategic direction, grounded in strong underwriting, disciplined risk management and ongoing operational improvements. With a solid financial foundation and a clear focus on long-term value creation, we are well positioned to sustainable and profitable growth.
Speaker Change: With that ill pass the call back to our President Kennedy for closing remarks.
Kennedy: Thank you Frank as we progress through 2020, we remain confident in our strategic direction grounded in strong underwriting discipline and risk management and ongoing operational improvements with a solid financial foundation and a clear focus on long term value creation, well will position to sustainable in the prop.
Kan Li: Thank you.
Speaker Change: Thank you.
Speaker Change: Yeah.
Speaker Change: Operator back to you we can go to the Q&A session.
Operator: Operator, back to you.
Operator: We can go to the Q&A session. We will now begin the question and answer session. To ask a question, you may press star and one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the button. If at any time your question has been addressed and you would like to withdraw your Please press star then.
Speaker Change: We will now begin the question and answer session.
Speaker Change: I ask a question you May press Star then one on you touched on selling.
Speaker Change: If you are using a speakerphone please pick up your handset before pressing the keys.
Speaker Change: If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star then two.
Kenning Zhao: At this time, we will pause momentarily to assemble our The first question today comes from Tenning Zhao with Norton Andrews. Please go ahead. Hi, I'm Kenning from Norton Andrews. Congratulations, and thank you for the great performance in the first quarter. Well, my first question is, there's a strong growth in your business, both in new loan origination and active users. And you mentioned there will be further growth. I wonder if that means you like the current macroeconomic environment and the loan market. And well, it's not big, but the delinquency rate has also picked up a little bit compared to the end of last year.
Speaker Change: At this time, we will pause momentarily to assemble our roster.
Speaker Change: Okay.
Speaker Change: Yeah.
Speaker Change: Your first question today comes from turning Zhao with Norton Andrew. Please go ahead.
Speaker Change: Yeah.
Kidding Problem: Oh, Hi, I'm kidding problem, Los Angeles, Congratulations and thank you for the great performance in the.
Speaker Change: The first quarter.
Speaker Change: Well My first question is there's a strong girls in your business clothing, you'll know R&D nation in active users and then you mentioned there will be afforded they're girls.
Speaker Change: I Wonder if that means you are your likes the current tomorrow economic environment and the loan market and.
Speaker Change: Well, it's not a big but the delinquency rate has also picked up a little bit compared to the end of last year. Its the loan volumes continue to grow should we expect a further increase in that.
Kan Li: If the loan volumes continue to grow, should we expect a further increase in the delinquency rate? And oh, I have a second question.
Speaker Change: The delinquency rate.
Speaker Change: And Oh, Okay, I have a second question.
Speaker Change: Oh, how we allocate it.
Speaker Change: As for safety first and then you can ask your learnings as well as far as immediate.
Speaker Change: With one month LIBOR I think you mentioned that's a real question can you are you all commented so let's let's.
Kan Li: I think you mentioned several questions in your comments, so let's get to them one by one. The first one is how we view the current environment. I think our company has never tried to grow our portfolio for the sake of growth. So we're always trying to manage our portfolio based on our assessment of the future environment. That being said, I think right now, based on our historic trend and based on our analysis, that I think the overall environment is still good for the portfolio growth. That is why we are still focused on the growth at this moment.
Speaker Change: That's great.
Speaker Change: Good to them one by one the first of all I don't know how we view the current environment I think our company has never.
Speaker Change: Turning to our portfolio folio for the sake of growth. So we're always trying to manage our portfolio based on their current based on our assessment of the future environment that being said.
Speaker Change: Right now.
Speaker Change: Based on our historic trends and our analytical.
Speaker Change: Based on our own analysis that isn't because the overall environment the steel.
Speaker Change: You're still good for the for the portfolio portfolio growth that is why is that and we are still focused on that at this moment.
Speaker Change: Another another thing from D. C is that things will go.
Kan Li: Another thing from this is that since the second half of last year, that we have invested a lot in acquiring new customers. So as these customers mature in our portfolio, we are able to offer them better lines, better products, so they stick with us longer. That is also the best foundation for our growth. In terms of the delinquency rate, I think the reason that you see an uptick from the lower level that we achieved somewhat last year is that I would say that that probably was the bottom part of our delinquency rate. So even with this uptick, I think our delinquency rate with regard to our portfolio is still very healthy.
Speaker Change: Our system since the sick and unhappy since the second half of last year that it would have been best of luck.
Speaker Change: In New York customers like this customer would be.
Speaker Change: As these customer mature anymore.
Speaker Change: Our portfolio, we are able to offer them a better data.
Speaker Change: Her line.
Speaker Change: The product so they stick with us for longer than that he is also the basic foundation in Florida.
Speaker Change: In terms of the delinquency rate I think of the reason that you will see a uptake from the lower level that we will achieve somewhat last year is that I wouldn't say that that's probably that was the bottom part of our delinquency rate. So even with this uptick I think that our delinquency rate to pay.
Speaker Change: With regard to our portfolio is still very healthy. So we are not we are not particularly concerned about that.
Kan Li: So we are not particularly concerned about that. And going forward, we do expect that our delinquency rate will still have some uptick, but those uptick will be more than offset by our overall scale. That basically means that our profit will not be impacted by the delinquency rate.
Speaker Change: Going forward, we do expect that that argument because everybody will still.
Speaker Change: We'll still have some uptick but it goes up people will be will be more than offset by our overall scale.
Speaker Change: <unk>.
Speaker Change: That basically means that our profitability will not be impacted at all by itself.
Speaker Change: Let's see.
Kan Li: Let me add a few words regarding the It's Income Statement under the Operation Expenses and Cost Expenses. The first one is automation and services, so basically it's operation expenses. The second one is the marketing acquisition, you know, customer acquisition. And the third one is general and administration costs. And so that's three generally cost. But the rest of it is from like a provision this way and a provision that way. If you add up together, this is all risk-related cost. If you add up this quarter Q1 and you add up Q4 last quarter, all the provisions together, you will find that all the Q1 provision is about 60 million RMB less than last quarter.
Speaker Change: Oh, let me and I'll deal with the debt.
Speaker Change: Uh huh.
Speaker Change: The delinquency rate.
Speaker Change: That number is actually.
Speaker Change: Actually as you know.
Speaker Change: At least qualify situation from last quarter to Q1 actually the stable and the number is a little bit of SKU.
Speaker Change: If you take another look if you look at our Q1.
Speaker Change: Income statement under the operation expenses constant.
Speaker Change: The first one's Oh, the inclination of the survey says basically that is alkylation expense at the second one is the marketing acquisition, you know customer acquisition and the scepter when there's general and administration costs and so that's three generally cost up but the rest of it is from from lack of position. This wasn't a provision.
Speaker Change: That way if you add up together this is all risks related cost.
Speaker Change: And I'll just call it a Q1.
Speaker Change: And Q to Q4 last quarter, although provision together you will find the Q. The all the cumulative position is about 60 million IOP less than last quarter.
Kan Li: But among this 60 million, actually, because this 57, almost 57 million is related to our Our own insurance business, which means because our own insurance business, the revenue you book on one period and the cost you book the whole thing together in one time. Because the last quarter, Q4, they did more, our guarantee company did more business, so they have more of that. So you take out this $57 million, actually the cost, apple to apple, the cost related to it, you take out all the risk related to the guarantee business, actually we have like a $3-4 million less cost compared with Q4.
Speaker Change: But Ah my oldest 16, many actually because a.
Speaker Change: 57, almost 57 million is the age was all well.
Speaker Change: Oh insurance business, which for me is it because the old insurance business.
Speaker Change: And when you book a little bit here either in the course of the book.
Speaker Change: Hosting together at one time.
Speaker Change: Because the last quarter Q4, maybe the more oh well.
Speaker Change: Guarantee company you get the more business. So do you have a more.
Speaker Change: So you take all of that is a 57 million actually the cost Apple that Apple to Apple.
Speaker Change: Related to that you know you take out all of the.
Speaker Change: The risks.
Speaker Change: Related to the guarantee business.
Speaker Change: Actually we have a like a three 4 million less cost in Q1 compared with Q4. So overall our conclusion is the.
Kan Li: So overall, the conclusion is the risk situation is basically the same, not much better, not much worse. That's the thing. But having said that, we all expect because this regulatory new dilemma will be coming in October, we will prepare, and because of that, there will maybe some uptick, cause the risk of situation with an uptick down the road, but not in the Q1, not in the Q2. We haven't found the risk situation change much at all. That's why we continue to invest a lot in customer acquisition also.
Speaker Change: The risk situation.
Speaker Change: And basically be the same not much better not much Lewis that that's Betsy, but having said that we all expect it because there's a legal regulatory the amendment would be coming in October.
Speaker Change: October we will we will prepare the.
Speaker Change: They will call it could be closer to that there was maybe some uptick.
Speaker Change: We don't close the loop situation.
Speaker Change: Well, that's an uptick down the road, but now that you would not end up to two five.
Speaker Change: I know there is a situation.
Speaker Change: The situation changed much at all and that's why we continue to invest a lot to catch my position also thank you.
Kenning Zhao: Thank you. Thank you for the detailed answer.
Speaker Change: Well, thank you for that detail Alastair Ah well my second question is about the repurchase.
Kan Li: Well my second question is about the repurchase. You haven't repurchased any shares in the first quarter but you have approved another share repurchase program. Just wondering if you repurchase any like during the April market volatility and should we expect you continue the aggressive stock buybacks as you did last year? Thank you. Yes, yes, because Q1 there's no open window, so we usually do the buyback during the open window from the old shareholders. Right now, I mean, the incoming open window, we're pretty much sure, you know, the remaining almost $60 million is not, it will be used up in the coming open window, and we will very likely to kick in to the buyback during the, you know, non-window period also.
Speaker Change: Oh, you you haven't repurchased.
Speaker Change: We repurchased any shares in the first quarter about you'll have approved another share repurchase program. Just wondering if you repurchase any like during the April market volatility and should we expect you continue the aggressive stock buybacks as you did last year. Thank you.
Speaker Change: Ah yes.
Speaker Change: Yes.
Speaker Change: Because Q1 was no open window. So we we usually do the buybacks during the open window from the old shareholders.
Speaker Change: Right now I mean, the incoming incoming open window are we pretty much for sure.
Speaker Change: They were mainly almost 16 million its not.
Speaker Change: It will be used up.
Speaker Change: Open window, and we will very likely a Q2 two to two.
Speaker Change: I bet you Linda.
Speaker Change: Oh no the only window period also so that's why we have a I guess a.
Kenning Zhao: So that's why we have this newly authorized $100 million to cover that. I hope I answered your question. Yes, certainly. Thank you very much. And thank you again for the wonderful culture.
Speaker Change: Newly authorized I'm committing to cover that Ah I hope I'll tell you the question.
Speaker Change: Yes, there's any thank you very much and thank you again for the wonderful culture.
Operator: As a reminder, if you would like to ask a question, please press star and one to be joined into the question.
Speaker Change: As a reminder, if you would like to ask a question. Please press Star then one b joined into the question queue.
Alex Yee: The next question comes from Alex Yee with UBS. Please go ahead. Hi, good evening. Thanks for taking my question. This is Alex from UPS.
Speaker Change: The next question comes from Alex <unk>.
Speaker Change: UBS. Please go ahead.
Speaker Change: Yeah.
Speaker Change: Hi, Good evening management. Thanks for taking my question just Alex from UBS. So I have two question. If I may. So first one is regarding your loan growth guidance for the next quarter.
Alex Yee: So I have two questions, if I may. So first one is regarding your loan growth guidance. to be a bit of a good growth. So just wondering what's driving the growth behind and how do you Underlying Loan Application or Credit Demand in the last two months in April or May. Have you seen any suffering trend given a lot of the noise on the microphone?
Speaker Change: Steve is going to be a bit of a ghost. So just wondering what's driving the growth behind and how do you see.
Speaker Change: The underlying applications all credit demand in the last.
Speaker Change: Two two mountains in April or May have you seen any softening trend, even a lot of noise on the microphones.
Speaker Change: Oh yeah.
Alex Yee: Yeah, and the second question is. it on your funding supply. So given, you know, there has been this new regulatory announcement since April. So I'm wondering, how have you heard any feedback from your funding partners with regard to their attitude towards this.
Speaker Change: The second question is a little bit on your funding supply. So given you know your housekeeping did you recognize me announcements since April so I'm wondering a how have you heard any.
Speaker Change: A few back from your funding partners.
Speaker Change: Got you your attitude towards these.
Speaker Change: And on pricing, which is about 24% and then do you see anything we need to adjust our corn purchase in order to ensure that we're more compliant.
Kan Li: OK MAX, Hi. Next question is do u see anything we need to adjust our current prices, in order to ensure that we are more compliant? OK, I'll first answer the first question about the growth. As I mentioned in the last investor, that our growth has always been based on our assessment for the upcoming risk environment. So at this moment, I think that the way that we grow our portfolio has always been acquiring new customers, and get the customer on board, and graduate them into a better product, which largely means a lower fees and the higher lines.
Speaker Change: Oh, Okay, I'll I'll first answer the question.
Speaker Change: Oh go after their first question about the girl and then making the last he's got asked Uh huh.
Speaker Change: Oracle has always been based on our.
Speaker Change: Our assessment for the upcoming fiscal environment.
Speaker Change: At this movement that I think that our the way that it will grow our portfolio has always been acquiring a new customer in the case of the customer on board and to graduate them into a better product, which is large and it means a lower fees and a higher line and our growth has largely going from this strategy.
Kan Li: And our growth has largely grown from this strategy. So you ask about April, or May, or June, that our growth path will always be like that.
Speaker Change: So you you ask about the April or May or June that Oracle Paas will always be like that.
Kan Li: In terms of our founding institutional partners, right now we are in very close conversation with them about the upcoming changes. And at this moment, what I can say is that we expect there will be changes, and we are going to make some adjustments, but I don't see – our company has always been confident that we will be fully compliant with the new regulation before the October 1st deadline, so we are not particularly concerned about that. But that being said, any new regulation will always bring some small shocks to the industry, so we do expect there will be some shocks in our industry.
Speaker Change: In terms of our founding institutional partners right now.
Speaker Change: Very close conversation with them about the upcoming changes.
Speaker Change: There's some movement on why I can say is that we expect that there will be changes.
Speaker Change: We are going to make some adjustment, but I don't see.
Speaker Change: Our company has always been confident that it will be fully compliant compliant.
Speaker Change: Before the October 1st State Tonight. So we are not in particular.
Speaker Change: Sorry about that but that being said any new regulation will.
Speaker Change: Always putting some stuff.
Speaker Change: Most shock to the industry. So we do expect that there will be some shocks in our industry is just about I think our company in a very good position to take those shocks. So our growth I think our growth path.
Kan Li: It's just that I think our company are in a very good position to take those shocks. So I think our growth prospect will not be changed based on whatever that we are providing to the company.
Speaker Change: Prospect it will not be changed.
Speaker Change: Based on whatever data, we are providing to them.
Speaker Change: For the Investor.
Kan Li: Hi, Alex. First of all, welcome to our online call, and welcome. Regarding that, let me just basically ask the same question again. And I think we really took advantage of the risk environment of good, risk environment since the second half of last year. So our run rate at the end of last year is already pretty high, and you see that we spent very aggressively in acquisition the Q1, and we will keep the same pace in terms of acquisition effort in the second quarter. So based on our current forecast for Q2 this year, we are ahead of 30% volume growth for this year, but we have no intention to increase that forecast anytime soon, because we will see in Q3 what's the effect of the regulatory policy impact on the industry.
Alex UBS: Hi, Alex.
Speaker Change: Chris will come 12 unencumbered will come on.
Speaker Change: Regarding the and let me just basically off the same same question again and I think.
Speaker Change: We really took advantage of.
Speaker Change: The.
Speaker Change: The risk environment.
Speaker Change: What's the environment to see what the last second.
Speaker Change: Second half last year. So our run rate is you know.
Speaker Change: And then one last years or are they pretty pretty high and we are you are you spending.
Speaker Change: So you see that we spend very aggressively.
Speaker Change: Positioning the Q1, and we will keep the same pace.
Speaker Change: Acquisition.
Speaker Change: But in the second quarter.
Speaker Change: So so so it's based on a kind of all kinds of up to Q2. This.
Speaker Change: This year, we are well ahead of the 30% you know that.
Speaker Change: The volume growth for this year.
Speaker Change: But we will.
Speaker Change: No not at all.
Speaker Change: I have no intention to increase the forecast anytime soon because.
Speaker Change: We will see.
Speaker Change: C ran into.
Speaker Change: The Q3.
Speaker Change: Well, what's the effect.
Speaker Change: You know the regulatory policy impact.
Speaker Change: On the industry. So so so the white collar.
Kan Li: So the white card, you know, and Yue Tang. Thank you all Regarding the prepare for the new regulatory, possible regulatory impact, we do some, you know, talking to the people and, you know, talking to the regulatory, mostly our institution partners and some regulatory, you know, authorities. And we have prepared some, you know, technology-wise, you know, if there's no new policy can come down and we can accommodate it very quickly, efficiently, you know, from top technology operation-wise. Other than that, we, you know, like anybody else, we don't know, you know, don't know much what's going to come down.
Speaker Change: No.
Speaker Change: It's a little uncertain, but we got in Q4, that's what I'm trying to say and so overall I think we are confident to achieve 30%.
Speaker Change: What are the goals for this year.
Speaker Change: I thought that you put up with it but maybe not more it's all because up to Cooper.
Speaker Change: Is it kind of went into limbo right now.
Speaker Change: Regarding the prepare for the new regulatory possible regulatory impact.
Speaker Change: Impac, we we do something.
Speaker Change: And talking to the people.
Speaker Change: How can you move the rig.
Speaker Change: But mostly our institution partners and some regular Ingrid.
Speaker Change: Yeah.
Speaker Change: That's all it is and we are prepared.
Speaker Change: Technology wise.
Speaker Change: You know if if if.
Speaker Change: The new policy.
Speaker Change: Come down and we can accommodate a they'll quickly efficiently.
Speaker Change: Technology wise other than that we you know we like anybody else. So we are we are we I don't know.
Speaker Change: Not much.
Speaker Change: Thank you.
Alex Yee: Thank you. Understood.
Speaker Change: Understood. Thank you very much.
Alex Yee: Thank you very much.
Operator: This concludes our question and answer session.
Speaker Change: This concludes our question and answer session.
Victoria Yu: I would like to turn the conference back over to Victoria Yu for any closing remarks. Thank you everyone for joining us today. If you have additional questions, please reach out to our investor relations team directly. We appreciate your interest and look forward to speaking with you again soon.
Victor: I would like to turn the conference back over to Victor <unk> for any closing remarks.
Speaker Change: Thank you everyone for joining us today, if you have additional questions. Please reach out to our Investor Relations team directly. We appreciate your interest and look forward to speaking with you again soon I'll be here.
Speaker Change: Back to you. Thank you.
Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect. www.fujifilm.co.uk
Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: [music].