Q1 2025 Yiren Digital Ltd Earnings Call
Operator: Good day and welcome to the first quarter 2025 year-end digital conference call. All participants will be in lesson-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.
Good day and welcome to the first quarter 'twenty 'twenty five.
Year end digital conference calls.
Participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the star key followed by zero.
Operator: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on a touchtone phone. To withdraw your question, please press star then 2. 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 on a touchtone phone.
To withdraw your question. Please press Star then two.
Please note this event is being recorded.
Keyao He: I would now like to turn the conference over to Keyao He, please go ahead. Thank you, operator. Good morning. Good evening, everyone.
Speaker Change: I would now like to turn the conference over to T O Huh.
Speaker Change: Please go ahead.
Speaker Change: Yes.
Speaker Change: They all began promoting and good evening everyone. Today's call features the presentation by the founder Chairman and the C. O N E I would be a mixture of NATO and no one's CFO Mr meaningful only in Kennedy CFO, Mr. William Wei like join Us, but if you're in a nice session. After the prepared remarks.
Keyao He: Today's call features the presentation by the founder, chairman, and CEO of Credit East, our CEO, Mr. Ning Tang, and our CFO, Mr. Yuning Feng.
Keyao He: Our incoming CFO, Mr. William Hui, will join us for the Q&A session after the prepared remarks. Before beginning, we would like to remind you that discussions during this call contain forward-looking statements made under the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. Such statements are subject to risks, uncertainties, and factors that can cause actual results to differ materially from those contained in any such statement. Further information regarding future risks, uncertainties, or factors is included in our filing with the U.S. Securities and Exchange Commission. We do not imitate any obligation to update any forward-looking statements as required under the relevant laws.
Speaker Change: Well I have to remind you the discussions during this call contain forward looking statements made under the safe.
Speaker Change: The provision of the private Securities Litigation Reform Act of 90 95, that's statement says that the risks uncertainties and factors that can cause actual results to differ materially. So I'm, just thinking that any such statements, but he's been making they got into it and then if he wants that test is included in our filings with the U S security.
Speaker Change: And Exchange Commission, we do not undertake any obligation to update any forward looking statements I do quite another run them at all.
Keyao He: During the call, we will be referring to certain non-GAAP financial measures and supplemental measures to review and assess our operating performance. These non-GAAP financial measures are now intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with the U.S. GAAP.
Speaker Change: During the call, we'll give a full range of certain non-GAAP financial measure and I'd imagine that yesterday and I'm operating performance isn't that a guest that doesn't that does not intended to be considered in Appalachia.
Speaker Change: And at that thank you and then just the nature of the pets and presented in accordance whether you have yeah, well information about those NASDAQ merger I listen the agents to get major wins with Ottawa and impressively.
Keyao He: For information about those non-GAAP measures and recommendations to GAAP measures, please refer to our annual press release.
Ning Tang: I will now pass it to Ning for opening remarks. Thank you all for joining our earnings conference call today. We are pleased to report another solid and healthy quarter. reflecting the strength of our technology transformation strategy. which focuses on sustainable growth, operational efficiency, technology innovation, and international expansion. of a core business benefits from domestic economic stimulus policies that boost consumption and expand credit access.
Speaker Change: I will now put the journey the opening remark.
Speaker Change: Thank you all for joining our earnings conference call today.
Speaker Change: We are pleased to report another solid and healthy quarter.
Speaker Change: Reflecting the one of our technology transformation strategy.
Speaker Change: Which focuses on sustainable growth operational efficiency technology innovation and international expansion.
Speaker Change: All the core business benefits from domestic economic.
Speaker Change: Policies that consumption and then expand credit access.
Ning Tang: Creating Sector-Wide Opportunity. through our strategic focus on attracting and serving high-quality borrowers. Combined with ongoing integration of advanced technology across our society. We are well-positioned to capitalize on these favorable conditions and confident in maintaining our growth momentum through 2025.
Speaker Change: Creating sector wide opportunities.
Speaker Change: So our strategic focus on attracting and serving high quality borrowers combined with ongoing integration of <unk>.
Speaker Change: The technology across our thoughtful.
Speaker Change: Well well positioned to capitalize on these favorable conditions and are confident in maintaining our growth momentum through 2025.
Ning Tang: Before discussing our operations in detail, I would like to share our interpretation of the new rules on loan facilitation business issued by China's National Financial Regulatory Administration in early April this year. Under the new rules, commercial banks are required to adopt a formal white list mechanism for fintech partnerships. and comply with standardized financing cost structures.
Speaker Change: Before discussing our operations in detail.
Speaker Change: I would like to share our interpretation of the new rules or laws facilitate what city pension business you saw the by China National Financial regulatory administration in early April this year.
Speaker Change: Under the new rules commercial banks are required to adopt a formal why this the metabolism.
Speaker Change: Fintech partnerships.
Speaker Change: And comply with standardized financing cost of structures.
Ning Tang: Under the new regulatory framework, we anticipate accelerated consolidation in China's online lending industry due to stricter compliance requirements. While smaller platforms may face pressure in maintaining partnerships with funding forces, major platforms like ours are gaining dominance through compliance advantages and technological strengths. Looking ahead, risk management capabilities, regulatory compliance, and differentiated product pricing capabilities will become critical competitive differentiators. And those are precisely the areas where we are strategically building our operational edge.
Speaker Change: Under the new regulatory framework, we anticipate a celebrated consolidation in China's online lending industry due to stricter compliance requirement.
Speaker Change: Well smaller platforms my face pressure, you're maintaining partnership with funding for major platforms like ours are gaining dominance will comply advantages and technological strength.
Speaker Change: Looking ahead risk management capabilities rapid luxury compliant and differentiated product pricing capabilities will become critical competitive differentiator.
Speaker Change: And those are precisely the areas, where we are strategically building our operational edge.
Ning Tang: Now, let me go through our business highlights for this quarter. First, on our financial services. In the first quarter of 2025, loan volume facilitated reached the RMB 15.2 billion. representing a slight decline of less than 1% quarter over quarter, but a strong 28% increase year over year. demonstrating resilience amid seasonal headwinds.
Speaker Change: Now let me go through our business highlights for this quarter.
Speaker Change: First.
Speaker Change: Our financial services business.
Speaker Change: In the first quarter of 2025 loan volume facilitated.
Speaker Change: The RMB 15 2 billion.
Speaker Change: Representing a slight decline of less than 1% quarter over quarter.
Speaker Change: But a strong 28% increase year over year.
Speaker Change: Demonstrating resilience amid the season, though how do we.
Ning Tang: We project the double-digit growth in loan volume for the second quarter this year, attributable to three key growth drivers. The first one is our growing repeat borrowing rate. which increased significantly to 74% in the first quarter of 2025 compared to 65% in the fourth quarter of 2024. Having successfully upgraded our customer base with higher quality borrowers, we are now focusing on increasing repeat borrowing within this premium segment. This strategic optimization allows us to grow our loan volume while improving customer acquisition cost efficiency. driving superior unit economics across our platform portfolio.
Speaker Change: We project the double digit growth in loan volume for the second quarter of this year.
Speaker Change: To build a boat to three key growth drivers.
Speaker Change: The first one is our going repeat.
Speaker Change: Borrowing rates.
Speaker Change: Which increased significantly to 74% in the fourth quarter of 2025 compared to 65% in the fourth quarter.
Speaker Change: Plenty plenty for.
Speaker Change: Having successfully upgraded our customer base with higher quality borrowers we are now focusing on increasing repeat borrowing within the premium segment.
Speaker Change: This strategic optimization allows us to grow our loan book, well improving customer acquisition cost the efficiency.
Speaker Change: <unk> Superior unit economics across our platform portfolio.
Ning Tang: Secondly, we have also broadened our traffic channel mix by adding three new partnerships this quarter. including collaborations with travel and lifestyle platforms. These partnerships are already contributing to our borrower acquisition and engagement.
Speaker Change: Secondly.
Speaker Change: We have also broadened our traffic channel mix by adding three new partnership this quarter.
Speaker Change: Including collaboration with travel and lifestyle platform.
Speaker Change: These partnerships are already contributing to our borrower acquisition and engagement.
Ning Tang: Thirdly, we continue to see exceptional results from our AI-driven initiatives, which are a cornerstone of our operations. In April, our proprietary large-language model, Zhiyu, received filing approval for commercial use. marking a key milestone in applying our AI technology to enhance marketing and engagement. During the first quarter of this year, Zhiyu generated over 550 advertising pieces in China and 20 video sets, 200 advertising text and the 200 images in the Philippines.
Speaker Change: Thirdly, we continue to see exceptional results from our AI driven initiative.
Speaker Change: Which are a cornerstone of our operations.
Speaker Change: In April our proprietary locked language model true.
Speaker Change: Received filing approval for commercial use.
Speaker Change: Marching a key milestone in applying our AI technology to your.
Speaker Change: Marketing and engagement.
Speaker Change: During the first quarter of this year.
Speaker Change: <unk> generated over 550 advertising pieces in China, and the 20th videos that 200 advertising test.
Speaker Change: And the 200 images in the Philippines stream.
Ning Tang: Streamlining Campaigns and the BOOST Impact. Moreover, our AI marketing system continues to demonstrate strong performance. Currently, our AI customer service system handles over 30 million calls per month, boosting acquisition efficiency and cutting labor costs. Specifically, for existing customer operations, in the first quarter of this year, our system served over 20 million existing borrowers. with advancements in semantic recognition and intent detection. enabling more meaningful and efficient interaction. On average, customer interaction Achieved 7.1 watts per session in the first quarter, up from 6.6 watts in the prior quarter. which further improves sales conversion.
Speaker Change: Streamlining campaign and the book impact.
Speaker Change: Moreover, our AI marketing system continues to demonstrate strong performance.
Carson Davis: Carson Davis, our AI customer service system handle over 30 million calls per month.
Speaker Change: Acquisition efficiency and cutting labor cost.
Speaker Change: Physically for existing customer accretion in the first quarter of this year. Our system served over 20 median existing borrowers.
Speaker Change: With.
Speaker Change: The mountains in semantic routes in Asia and in time.
Speaker Change: Sure.
Speaker Change: They build a more meaningful and efficient interactions.
Speaker Change: Oh average customer interaction.
Speaker Change: Achieved 711 plus.
Speaker Change: Her section in the fourth quarter up from 6.6, well in the prior quarter.
Speaker Change: Well the input so Congress yet.
Ning Tang: Furthermore, customer service has also seen concrete improvement. The 22nd call pick up rate has increased to 96% in the first quarter this year from 85% in the prior quarter. Delivering a faster, more seamless customer experience and reinforcing our commitment to high quality service standards.
Speaker Change: Furthermore, customer service efficiency.
Speaker Change: <unk> also seen come quick improvement there.
Speaker Change: 22nd call pick up Great Trust, Inc.
Speaker Change: 296% in the first quarter this year from 85% in the prior quarter.
Speaker Change: Delivering a faster more seamless customer experience and reinforcing our commitment to high quality service standard.
Ning Tang: Additionally, we have launched an AI-powered marketing prediction system, which enables personalized and precise customer target Meanwhile, our proprietary AI driven internal customer service training platform is well received among our employees. It provides a variety of training services, such as role stimulation, AI-powered business trading suggestions, real-time AI evaluation feedback, and AI-generated training reports. which has enhanced agent communication quality and ensured compliance with operational standards.
Speaker Change: Additionally, we have launched and AI powered a marketing predictions.
Speaker Change: Which enable personal lives and the precise customer hockey team.
Speaker Change: Meanwhile, our proprietary AI driven internal customer service training platform is well received among our employees.
Speaker Change: It provides.
Speaker Change: If you are planning services, such as roll email that female.
Speaker Change: Stimulation.
Speaker Change: AI powered.
Speaker Change: News ratings suggestions real time, AI evaluation feedback and AI generated 20 reports.
Speaker Change: Which has enhanced the agent communication quality and ensure compliance with our professional standards.
Ning Tang: Now let's turn to the funding aspect. In the first quarter of 2025, we added four new institutional funding partners, bringing our total number of funding sources to nearly 60. Meanwhile, our funding costs continue to decline by nine basis points in March compared to December 2024, paving the way for our long-term high-quality growth. Regarding our asset quality, risk indicators remain stable at historical low in the first quarter of 2025. As of March 31st, delinquency rates for loans past due for 1 to 30 days, 31 to 60 days, and 61 to 90 days were 1.6%, 1.2%, and 1.2%, showing negligible fluctuation from the previous quarter.
Speaker Change: Now, let's turn to the funding aspect.
Speaker Change: In the first quarter of 2025, we added four new institutional funding partners, bringing our total number of funding sources to nearly 60.
Speaker Change: Meanwhile, our funding costs continued to decline by nine basis points in March compared to December 20th only for paving the way for our long term high quality growth.
Speaker Change: Regarding our asset quality.
Speaker Change: Indicators remain stable at a historical low in the first quarter of 2025.
Speaker Change: As of March 31st.
Speaker Change: Currency rates for loans past due for one to 30 days 31 to 60 days and the 61 to 90 days or one 6%, one 2% and one 2% showing net leasable fluctuation from the previous quarter.
Ning Tang: This stability reflects our commitment to maintaining high asset quality through rigorous risk management practices.
Speaker Change: This stability reflects our commitment to maintaining a high asset quality through rigorous risk management practices.
Ning Tang: It's worth mentioning that AI has played a pivotal role in enhancing our asset management efficiency. Take long collection work for instance. In the first quarter of 2025, 83% of day one delinquent cases 29% of day two cases and 28% day three cases in the domestic market were handled by AI collection robots. trading approximately RMB 1.9 million monthly in labor costs. In the Philippines, AI collection strategies have reduced the complaints by 14 percent quarter over quarter, further improving our operational efficiency and the service quality.
Speaker Change: It's worth mentioning that AI has played a pivotal role in enhancing our asset management and efficiency.
Speaker Change: Take long tracks of work for instance.
Speaker Change: In the fourth quarter of 2025, 83% of day, one delinquent cases.
Speaker Change: 29% of day, two cases, and the 28%. They three cases in the domestic market were handled by AI collection robots.
Speaker Change: Saving approximately RMB, one 9 million monthly your labor cost.
Speaker Change: In the Philippines, AI collection strategies have reduced the complaint by 14% quarter over quarter further improving our operational efficiency and the service quality.
Ning Tang: Now, let's look at our overseas people. which continues to demonstrate strong momentum. In the first quarter of 2025, our loan volume in the Philippines reached RMB 123.7 million, representing a 74% growth compared to the fourth quarter of 2024, with new borrowers' loan facilitation up 108% quarter over quarter.
Speaker Change: Now, let's look at our overseas business.
Speaker Change: Which continues to demonstrate strong momentum.
Speaker Change: In the first quarter of 2025, our loan volume in the Philippines reached RMB $123 7 million, representing a 74% growth compared to the fourth quarter of 2024 with new borrowers loan facilitation.
Speaker Change: 108% quarter over quarter.
Ning Tang: Yuning Feng, Chunjiang Ji, William Hui, Yuning Feng, Zafar Aziz, Yuning Feng, Yuning Feng, Looking ahead, we anticipate a double-digit growth in loan volume in the Philippines for the second quarter this year. Meanwhile, preparations for our expansion into Indonesia are progressing well, with operations expected to launch in the second half of 2025. We are also leveraging AI to optimize marketing, enhance intent recognition, and reduce costs, further supporting our international growth. With that said, AI remains central to our strategy. In addition to using AI in our operations, we are expanding our AI ecosystem through investment in AI technologies and exploring potential acquisition opportunities globally.
Speaker Change: Paving the way for our continued growth in the let's say.
Speaker Change: We will drive up our repeat borrowing later this year.
Speaker Change: Looking ahead, we anticipate a double digit growth in loan volume in the Philippines for the second quarter. This year.
Speaker Change: Meanwhile, preparations well our expansion into Indonesia are progressing well with operations expected to launch in the second half of 2025.
Speaker Change: We're also leveraging AI to optimize marketing you have intent recognition and reduce costs.
Speaker Change: Further supporting our international growth.
Speaker Change: With that said Hey, I.
Speaker Change: It remains central to our strategy.
Speaker Change: In addition to using AI you know accretion.
Speaker Change: Expanding our AI ecosystem through investment in AI technologies, and exploring potential acquisition opportunities globally.
Ning Tang: These efforts support collaboration while speeding up innovation and time to market.
Speaker Change: These efforts support collaboration well speeding up innovation and time to market.
Ning Tang: Now, go on to our insurances. Our insurance brokerage market continues to face headwinds due to regulatory tightening and market contraction. particularly in the life insurance sector. In the first quarter of 2025, our total premiums reached RMB 801.8 million, with revenue of RMB 71.5 million, reflecting a sharp decline of 12% and 43% year-over-year, in line with broader industry trend.
Speaker Change: Now go on to our insurance business.
Speaker Change: Our insurance brokerage market continues to face a weak due to regulatory tightening in the market contraction.
Speaker Change: Particularly in the life insurance segment.
Speaker Change: In the first quarter of 2025.
Speaker Change: Our total premiums reached RMB 801, 8 million with revenue of RMB seven.
Speaker Change: The $1 5 million, reflecting a sharp decline of 12% and 43% year over year.
Speaker Change: Your line with broader industry trends.
Ning Tang: To navigate these challenges, we are adopting a dual-pronged strategy. For life insurance, we're leveraging new media, customer acquisitions and digital channels to drive momentum. For property insurance, we are capitalizing on emerging opportunities by expanding embedded insurance in sectors such as AI robots and the low altitude economy. By focusing on providing tailored, high-value products, we are aligning with new growth areas in the economy.
Speaker Change: To navigate these challenges we are adopting a dual pronged strategy.
Speaker Change: For life insurers.
Speaker Change: Leveraging new media customer acquisition and the digital channels.
Speaker Change: To drive momentum for <unk>.
Speaker Change: Property insurance, we are capitalizing on emerging opportunities by expanding embedded insurers in sectors, such as AI rowboats and at the low altitude economy.
Speaker Change: By focusing on providing tailored high value products, we are aligning with new growth areas in the economy.
Ning Tang: Driving Innovation and Strengthening Our Patterns. based on current effects. We anticipate a remarkable recovery in our insurance brokerage business next quarter. Moreover, we are also seeing growing synergies between our lending and insurance businesses. with premiums from cross-selling up 67% quarter over quarter, demonstrating the effectiveness of our integrated business model.
Speaker Change: Driving innovation and strengthening our partnership.
Speaker Change: Based on current assessments, we anticipate a remarkable recovery in our insurance brokerage business last quarter.
Speaker Change: Moreover, well also seen growing synergies between our lending and insurance businesses with.
Speaker Change: With premiums from cross setting up 67% quarter over quarter.
Speaker Change: Demonstrating the effectiveness of our integrated business model.
Ning Tang: Now for the Consumption and Lifestyle Business Section. Following a strategic review, we determined that the segment has reached an optimal scale with high penetration. It will require a substantial investment to grow the business to the next level.
Speaker Change: No for the consumption and lifestyle business segment.
Speaker Change: Following a strategic review.
Speaker Change: We determined that the segment has reached the optimal scale with high penetration.
Speaker Change: It will require a substantial investment to grow the business to the next level.
Ning Tang: As a result, we are realigning resources to focus more on financial services and AI-driven innovation. where we see greater opportunities for sustainable growth.
Speaker Change: As a result.
Speaker Change: We are realigning resources to focus more on financial services and AI driven innovation.
Speaker Change: Where we see greater opportunities for sustainable growth.
Ning Tang: As we look ahead to 2025, we see significant opportunities for both our core business and the new areas emerging as we transform into a more international and technology-driven organization. We will continue to emphasize AI-driven innovation and application as one of our four pillars of growth. By pursuing a path of global high-quality development, we are confident in our ability to achieve sustainable progress. And we will remain focused on creating long-term value for our customers.
Speaker Change: As we look ahead to 2025, we see significant opportunities for both our core business and the new areas emerging as we transform into a more international and the technology driven organization.
Speaker Change: We will continue to emphasize given the innovation and application.
Speaker Change: One of our four pillars of flow back.
Speaker Change: Pursuing a path of global high quality development, we are confident in our ability to achieve sustainable progress and the we will remain focused on creating long term value for our customers.
Ning Tang: Partners, and the Shareholders.
Speaker Change: Partners and the shareholders.
Ning Tang: Finally, we have a management change to announce. Mr. Yuning Feng, our current CFO, will step down from his position on July 30, 2025, due to personal reasons. We sincerely thank Yuning for her dedication and contribution to Yiren Digital and wish him all the best in his future endeavors.
Speaker Change: Finally, we have a management change to announce.
Speaker Change: Mr. <unk>, our current CFO will step down from his position on July 32025, due to personal reasons.
Speaker Change: We sincerely thank you name.
Speaker Change: All her dedication and contribution to digital and to wish him all the best in his future endeavors.
Keyao He: We are delighted to welcome Mr. William Hui as our new CFO. With nearly two decades of experience in investment banking and capital markets, William has a strong track record in global investment operations. Since joining our parent company, Credit Yves, in 2017, he has played a key role in driving investment and capital market strategy. His extensive leadership background and expertise are invaluable as we continue to grow and strengthen our organization.
Speaker Change: I'm delighted to welcome Mr. William Li our meals that vote.
William Li: With nearly two decades of experience in investment banking and capital markets. William has a strong track record in global investment operation.
Speaker Change: Since joining our company quite at ease in 2017. She has played a key role in driving investment and capital market strategy.
Speaker Change: His extensive leadership backgrounds and expertise.
Speaker Change: Invaluable as we continue to grow and so on.
William Li: Our optimization.
Yuning Feng: With that, I will pass it to Yuning, who will go through the financial performance for this quarter. Thank you, Mr. Yang, and thank you for all your kind wishes. So hello, everyone. On this call, I will be focused on our key financial highlights. Please refer to our earnings release and error deck for further details, both available on our website.
Union: With that I will pass it to Union, who will go through the financial performance for this quarter.
Union: Thank you Michelle.
Speaker Change: Thank you portfolio Congresses.
William Li: Everyone on this call I will be focused on our key financial highlights please refer to our earning release and IR deck.
William Li: Further details both available on our website.
Yuning Feng: Firstly, we are pleased to report a steady growth in the first quarter of 2025. Our total revenue increased 13% year-over-year to RMB 1.6 billion. In the financial service segment, total loan facilitation reached $15.2 billion in the first quarter, up 28% year-over-year. The growth was primarily driven by robust demand for small revolving loan products. Coupled with a steady increase in demand from repeat higher quality borrowers. The platform's ability to attract, retain, and nurture high-quality borrowers has been a key driver of the sustained growth in loan loaning. As a result, revenue from these segments surged by 59% year-over-year to RMB1.2 billion in the first quarter.
William Li: Firstly, we are pleased to report a steady growth in the fourth quarter of 2025, our total revenue increased 13% year over year to RMB, one 6 billion.
William Li: In the financial service segment total loan facilitation reached $15 2 billion in the first quarter.
William Li: 28% year over year.
William Li: The growth was primarily driven by robust demand for our small revolving loan product coupled with a steady increase in demand from repeat higher quality borrowers.
William Li: The platform's ability to attract retain and near term high quality borrowers has been a key driver of sustained growth in long haul them.
William Li: As a result revenue from these segments searched by 59% year over year to RMB, one 2 billion.
William Li: First quarter.
Yuning Feng: Further highlighting the platform's success in meeting growing customer demands. In the fourth quarter, the revenue from guaranteed service reached RMB380 million compared to RMB170 million in the same period last year, reflecting the growing loan volume facilitated under the risk-taking model. As loan balance and the risk-taking model continue to grow, we expect higher revenue contribution from the guaranteed service.
William Li: Further highlighting the platform success in meeting growing customer demand.
William Li: In the first quarter. So revenue from guaranteed service reached RMB 388 minutes compared to 17 million in the same period last year.
William Li: <unk> growing longwall.
William Li: And there are some good.
William Li: Take care model.
William Li: Loan balance.
William Li: Pick a model continuing to grow.
William Li: We expect higher revenue contribution from <unk> services.
Yuning Feng: In the insurance sector, our gross return premium totaled RMB802 million in the first quarter of 2025, making a 12% year-over-year decline. The decline was mainly driven by industry-wide new sales contraction amid regulatory changes. Consequently, revenue from our insurance segment declined 43% year-over-year to RMB71 million.
William Li: And the insurance.
William Li: Our gross written premium totaled RMB.
William Li: Hungrier than two minutes in the first quarter of 2025, making a 12% year over year decline. The decline was mainly driven by industrialized new sales.
William Li: Traction I mean regulatory changes.
William Li: Consequently revenue from our insurance segment declined 43% year over year to RMB 71 minute.
Yuning Feng: in the consumption and lifestyle sector. As we strategically scaled back product offering since the second half in 2024, the total revenue dropped 40% year over year to RMB 308 million.
William Li: And the consumption that lifestyle segment.
William Li: Strategically scaled back for their opening since the second half in.
William Li: The 2020 for the total revenue jumped 40% year over year to RMB 300 page women following our strategic review.
Yuning Feng: Following our strategic review, just as Mr. Tao mentioned, we have decided to focus more on our financial service and AI-driven innovation to optimize our ROI as we see greater business opportunity there. On the expense side, sales and marketing spend in the first quarter edged down 0.1% year-over-year to RMB277. which remain stable. This reflects better cost efficiency from development of our AI technology. Research and development expenses increased 112% year-over-year to RMB86 million as we increased our investment in AI productivity technologies, strategic recruitment of specialized talent. Origination, servicing and other operating costs to RMB225 million in the fourth quarter.
Tom: Tom mentioned, we have decided to focus more on our financial service NPI driven innovation to optimize our ROI as we see greater business are coming to bear.
William Li: On the expense side sales.
William Li: Sales and marketing spending in the first quarter edged down two 1% year over year to RMB 277 million.
William Li: Which remained stable this reflects better cost efficiency from development of our AI technology.
William Li: Research and development expenses increased 112% year over year to RMB 86 million as we increased our investment in AI productivity.
William Li: Productivity tax okay.
William Li: <unk> technologies' strategic recruitment of specialized talent.
William Li: Yes.
William Li: Our origination servicing and other operating costs were RMB 225.
William Li: In the fourth quarter.
Yuning Feng: Zhang, 4% year-on-year, which remains stable. Unknown Attendee, Zafar Aziz, Yuning Feng, Chunjiang Ji, William Hui, Yuning Feng, Chunjiang The allowance for contract assets and receivables for the quarter was RMB 153 million. of 49% year-over-year. This may be driven by the continued growth of low volume facilitated on our platform, as well as our cautious approach to risk management. Provision for contingent liability this quarter increased 511 year-over-year to RMB 411 million. This reflects the higher long-volume growth facilitated under our risk-taking model. which in accordance with our current accounting standard require substantial upfront provision while the corresponding revenue will be recognized on a monthly basis throughout a long lifespan.
William Li: Down 4% year on year, which remains stable.
William Li: <unk> expenses for the first.
William Li: Quarters increased by 15% year over year to RMB 96 minute taking.
William Li: Increase reflects on pumped incentive bonuses and increased employee benefits expenses.
William Li: So loans.
William Li: Contract assets on receivables for the quarter was RMB 153 minutes.
William Li: Posting 9% year over year. This mainly driven by the continued growth of law Walden placebo traded on our platform.
William Li: Yes.
William Li: Our cautious approach to risk management.
William Li: Provision for provisions.
William Li: Provision for contingent liability this quarter increased 511 year on year to RMB 411 minutes.
William Li: This reflects a higher loan volume growth, it's under our risk taking model.
William Li: Rich holdings is our current accounting standards require substantial hubs on provision well to corresponding revenue will be recognized.
William Li: The basis for our throughout alone Blackstone.
Yuning Feng: On the bottom line, net income of this quarter was RMB248 million, decreased 49% year-over-year.
William Li: So on the bottom line margin net income of this quarter was RMB 248 million.
William Li: Creased, putting an Rx was down year over year decline in net income.
Yuning Feng: The decline in net income can be attributed to four key factors. First, substantial up-sum provisions were allocated due to growing in long-haul and under our risk-taking business model. Unknown Program Coach, Peter Johnstone, Dr. Peter Johnstone, Dr. Peter Johnstone, Unknown Certainly, there was a reduction in overall profitability within the insurance business as well as the lifestyle and consumption business sector.
William Li: Attributed to four key factors.
William Li: First substantial upfront provision were allocated to due to Corona and dawn wall and under our risk taking business model.
William Li: That model second research and development expense increased as we continue to enhance our in house.
William Li: But does it just.
William Li: Certainly there was a reduction in overall profitability.
William Li: Switching to the insurance business as well as lifestyle and consumption business segment.
Yuning Feng: regarding our cash flow. We generated approximately RMB 479 million net cash from our operations in the fourth quarter. On our balance sheet, our cash and cash equivalents remain strong at RMB4 billion. Underscoring our financial flexibility and positioning us to capitalize our strategic opportunities.
William Li: Regarding our cash flow.
William Li: The general rate case.
William Li: Proximately RMB 470.
William Li: 79 million net cash from our operations team to fourth quarter.
William Li: Our balance sheet, our cash and cash equivalents remained strong at RMB 4 billion.
William Li: Underscoring our financial flexibility and positioning.
William Li: To capitalize on strategic opportunities.
Yuning Feng: Lastly, on our business outlook, based on our assessment of current business and marketing condition, we expect our revenue for the second quarter of 2025 to stand between RMB 1.6 billion to RMB 1.7 billion, representing a 7% to 14% year-on-year increase with a healthy net profit margin. This represents our current and preliminary assessment, which may be subject to changes and uncertainty.
William Li: Lastly, on our business outlook based on our assessment of current business marketing conditions, we expect our revenue for the second quarter of 2025 to stand between RMB, One 6 billion to RMB, one 7 billion.
William Li: Representing a 7% to 14% year on year increase.
William Li: Healthy net profit margin.
William Li: This represents our current and preliminary assessment, which may be subject to changes and uncertainties.
Yuning Feng: So here we have concluded our remarks.
William Li: So here we have conclusion.
Keyao He: Hong Rui Tao, William Hui, Xu De, Xin Ku, Juglie Qin, Hu stipa, Bai Lua, entender, We're now ready for Q&A. Thanks. Thank you.
William Li: All right now.
William Li: And now right.
William Li: Thanks.
Keyao He: We will now begin the question and answer session.
William Li: Got you.
William Li: We will now begin the question and answer session.
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 keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2.
William Li: To ask a question you May press Star then one on you touched on phone.
William Li: If youre using a speakerphone please pick up your handset before pressing the keys.
William Li: If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star then two.
Operator: At this time, we will pause momentarily to assemble our roster.
William Li: At this time, we will pause momentarily to assemble our roster.
William Li: Okay.
Chris Wu: Our first question comes from Chris Wu from... Look Capital, please go ahead. Hey, thank you.
Speaker Change: Our first question comes from Chris <unk> from <unk>.
Speaker Change: Capital. Please go ahead.
Speaker Change: Hey, Thank you.
Ning Tang: Perhaps my question is what kind of impact or changes to expect from the new loan facilitation Okay, thank you for the question. The recent loan facilitation regulation in China, I believe is a significant step. to work formalizing and stabilizing the industry within the country's financial framework. So these rules promote greater transparency and regulatory clarity. which align with the government's broader goals of supporting financially robust lenders and fostering healthy industry growth. So for UN Digital. We have benefited from, it is beneficial for a big platform like us. As the industry will see, we'd like to see an acceleration in industry consolidation.
Speaker Change: Perhaps my question is what kind of impact or changes to expect from the new loan facilitation rules. Thank you.
Speaker Change: Okay. Thank you for the question.
Speaker Change: The recent loan facilitation regulation in China.
Speaker Change: So that's a kind of a step toward formalizing and stabilizing getting industry.
Speaker Change: Countries financial framework.
Speaker Change: These rules promote greater transparency and regulatory clarity.
Speaker Change: Which align with our customers' supported goals of supporting.
Speaker Change: Eventually that will possibly lenders.
Speaker Change: Fostering healthy growth.
Speaker Change: Human digital.
Speaker Change: Benefited from.
Speaker Change: Jeff it's beneficial.
Speaker Change: Like us.
Speaker Change: Yes.
Speaker Change: We'd like to see.
Speaker Change: Our relationship with industry consolidation. So we are already on the watch list.
Ning Tang: So, as we are already on the white list. of our funding partners. So we believe this is good news for us.
Speaker Change: Yeah.
Speaker Change: Something partners so.
Speaker Change: And so I couldn't use for us.
Ning Tang: Okay, I hope that answers your question, please. and that question?
Speaker Change: I hope that's okay great.
Speaker Change: And next question.
Chris Wu: Do you have any other questions?
Speaker Change: Yeah do you have any other questions.
Keyao He: Yeah, can you provide some details on the international expansion? Thank you. Thanks. and Tang Dong.
Speaker Change: Yeah.
Speaker Change: Can you provide some details on the international expansion. Thank you.
Speaker Change: Thanks.
Speaker Change: And.
Speaker Change: And tell them Oh, well you will answer this question sorry.
Ning Tang: Will you answer this question? And then previously reported.
Speaker Change: Sorry, I start and then.
Speaker Change: Previously.
Speaker Change: Reported.
Ning Tang: The international business is very strategic, and for us, and will yeah, grow into a significant part of our. Yeah, revenue and the value in, in, uh, uh, future. Uh, I hope, uh, yeah, not too far away and, uh.
Speaker Change: International business is there.
Speaker Change: It is strategic.
Speaker Change: And for Us and will yeah.
Speaker Change: Grow into a significant part of our yeah revenue and value.
Speaker Change: In the future.
Speaker Change: Future I hope Ah yeah.
Speaker Change: The too far away and Oh, we are making very solid progress.
Ning Tang: We are making very solid progress in the Philippines as I earlier reported. Uh, yeah, and the, uh. Yeah, 2nd quarter will likely see. Uh, also double digit, uh, uh, well, and, uh, also, uh, we are already profitable there.
Speaker Change: The Philippines as I earlier reported Oh, yeah.
Speaker Change: And yeah.
Speaker Change: Second quarter will likely see a also double digit.
Speaker Change: ROE and also we're already profitable there.
Ning Tang: and so AI is. playing a very key role in the Philippines and I expect also in other markets, international markets. And yeah, we are working closely with our partner in Indonesia for the launch. Yeah, soon, sooner rather than later, I hope. Yeah, in the beginning of the second half of the year. And because our partner has very rich resources in Indonesia, and we, yeah, contribute our great technology capability and also FinTech experience in mainland China and also in the Philippines. So there's strong synergy between the partners.
Speaker Change: And so AI is playing.
Speaker Change: Playing a key role in the Philippines and a factor also in the other markets are international markets.
Speaker Change: And yeah, we are working closely with our partner.
Speaker Change: In Indonesia.
Speaker Change: Sure.
Speaker Change: The launch yeah.
Speaker Change: Soon sooner.
Speaker Change: So now rather than later I hope yeah in the beginning of the.
Speaker Change: Second half of the year.
Speaker Change: And because our partner has a very rich resources.
Speaker Change: In.
Speaker Change: Indonesia.
Speaker Change: And we Ah yeah.
Speaker Change: Contribute to our great.
Speaker Change: Technology capability and also a fintech experience.
Speaker Change: In mainland China and also in the Philippines.
Speaker Change: So there are strong synergies.
Speaker Change: Between the partners and I very much.
Ning Tang: And I very much hope that, yeah, our results in Indonesia will also be very positive.
Speaker Change: Hope that yeah.
Speaker Change: Yeah, our results in Indonesia will also be very positive.
Speaker Change:
William Hui: William, you have a more color to add. Yeah, I'll just add some financial context into it. So in Q1, our international transaction volume, has reached 1.24 billion RMB. That's up 75% quarter over quarter with a lower rate facilitation for new borrower growing by 108%. So, so we expect. a continued double-digit growth in low volume in the second quarter.
Speaker Change: With them you'll have a.
Speaker Change: More color to add yes.
Speaker Change: Yes.
Jeff: Well, Jeff I'll, just add some financial context into it so in Q1.
Speaker Change: Our international transaction volume.
Speaker Change: Each one to give you an RFP.
Speaker Change: That's up 75% quarter over quarter with a lower facilitation for new borrower growing on 100.
Speaker Change: At 8%.
Speaker Change: So so we expect.
Speaker Change: A continued double digit growth.
Speaker Change: In the second quarter so.
William Hui: So in Indonesia, As Ning just mentioned, we are preparing for the launch and we expect it will launch in the second half of this year. And meanwhile, besides the Philippines and Indonesia, we will continue to explore the possibilities of the other markets, such as the Middle East or even the Europe. Thank you all. And I hope that answers the question, Chris. Thank you.
Tony: Tony's here.
Speaker Change: As Nick just mentioned.
Speaker Change: Yeah.
Speaker Change: Preparing for the launch and we expect that launching a second half of this year and.
Speaker Change: Meanwhile, Besides the Philippines, Indonesia, you will continue to explore.
Speaker Change: The possibilities of the auto market.
Speaker Change: Which is the middle east or in New York.
Speaker Change: Thank you.
Speaker Change: And I hope that answers your question Greg.
Speaker Change: Thank you.
Speaker Change: Thank you.
Dale Tiongson: Our next question comes from the line of Dale Tiongson, a shareholder. Please go ahead. Hi, thank you for taking my question. I just wanted to ask about the crypto asset that appeared on the balance sheet this quarter and then also the fair value adjustment. So any, any context there would be great.
Speaker Change: Our next question comes from the lineup.
Speaker Change: Charles Johnson a shareholder please go ahead.
Speaker Change: Yeah.
Speaker Change: Hi, Thank you for taking my question I, just wanted to ask about the crypto asset.
Speaker Change: Appeared on the balance sheet this quarter and then also the fair value adjustment.
Speaker Change: So anyhow any context, there would be great.
Speaker Change: Mhm.
Speaker Change: Okay.
Speaker Change: Yeah.
Zafar Aziz: Keyao, this is about what asset? Zafar Aziz, Yuning Feng, Chunjiang Ji, William Hui, Yiren Zafar Aziz, Yuning Feng, Chunjiang Ji, William Hui, Yiren Zafar Aziz, Yuning Feng, Chunjiang Ji, William Hui, Yiren Yeah, this is a part of our effort to invest our cash. And yeah, so crypto is becoming more mainstream and part of the financial system. So it's a minority piece of our investment effort. And in the first quarter, it experienced some value drop. But as we see, its value has gone up. Yeah, so we expect some fluctuation, yeah, in this emerging asset class. But yeah, we are hopeful that we are making a good investment and things will work out.
Speaker Change: All of this is about Oh, what is that.
Speaker Change: Crypto asset and then also otherwise a fair value adjustment that.
Speaker Change: Took place in the quarter and in.
Speaker Change: The cash flow statement, it looks like it might be related to that.
Speaker Change: They have assets.
Speaker Change: Yeah.
Speaker Change: This is a part of our Ah yeah effort to yeah in last hour.
Speaker Change: Our cash and yeah.
Speaker Change: So creates a crypto is.
Speaker Change: Becoming a more mainstream and part of the yeah, a financial system. So it's.
Speaker Change: A minority piece.
Speaker Change: Each of our yeah.
Speaker Change: Investment.
Speaker Change: Efforts and are in the first quarter it experienced some.
Speaker Change: Value.
Speaker Change: Chop, but.
Speaker Change: We see it's a baidu has.
Speaker Change: Yeah. So.
Speaker Change: We expect some fluctuation.
Speaker Change: Yeah in this.
Speaker Change: Emerging asset class, but yeah.
Speaker Change: Yeah, we are hopeful that the yeah.
Speaker Change: We are making a suite.
Speaker Change: You have asthma.
William Li: Things will workout, William you'll have more color to add.
Yuning Feng: William, you have more color to add? and Yun Tang. Yeah, this is Yuning. So yes, in the first quarter, we have allocated a small amount of our cash into the crypto assets, as we explore new ways to manage our especially overseas cash and cash equivalent in our balance sheet. As Mr. Tang mentioned, in the first quarter, there are some market fluctuations, and we have managed our positioning during the first quarter and second quarter, and we are happy to see that actually the fluctuation we see has been already, the asset value has been going back in the second quarter.
Speaker Change: Hmm.
Speaker Change: Okay.
Speaker Change: Yeah, there's actually one so yes in the first quarter, we have allocated and there was a small amount of our cash to encourage SB.
Speaker Change: These four new ways to manage our especially overseas cash.
Speaker Change: Cash and cash equivalent on our balance sheet.
Speaker Change: Mr. Tom mentioned it was.
Speaker Change: In the fourth quarter, there are some markets navigation and.
Speaker Change: We have managing car petitioning during the first quarter and second quarter.
Speaker Change: Turning to see that actually to foundation, we see us being already.
Speaker Change: So to have that value has been going back in the second quarter.
Yuning Feng: And in the fourth quarter, the fair weather changes on this investment item has been approximately 70 million US dollars. I hope that answers the question.
Speaker Change: In the fourth quarter, it's a fair amount of room.
Speaker Change: Changes on this one.
Speaker Change: It has been approximately 770.
Speaker Change: 70 million.
Speaker Change: <unk>.
Speaker Change: So I hope that answered the question.
Yuning Feng: Please check the shared link below for the download link. So, yeah, when we look back, that value adjustment will be lifted in a second.
Speaker Change: Yeah.
Speaker Change: With that Jasmine for bad have you.
Speaker Change: Oh, we haven't seen that yet in your adjusted EBITDA in the first call anyway.
Speaker Change: And your next 95, I'm, telling you, which is quite stable compared to normal.
Speaker Change: So yeah.
Speaker Change: Yeah, that's not really Catherine worthy.
Speaker Change: In the second quarter.
Speaker Change: Yeah.
Zafar Aziz: Okay, and then, um, on the guarantee business, Just to correct, just to correct the parameter changes in the class of 2017 and R&D. Great.
Speaker Change: Okay and then.
Speaker Change: On the guaranteed business I just want to ask.
Speaker Change: Just subtract the fair value changes in this asset class over 70 million in R&D.
Speaker Change: Yeah.
Speaker Change: Yes.
Speaker Change: Great and then when do you expect the guaranteed business to sort of stabilize.
Zafar Aziz: And then when do you expect the guaranteed business to sort of stabilize? Zafar Aziz, Yuning Feng, Chunjiang Ji, William Hui, Yiren Yeah, currently, the security business is at around 40% level. And we believe the 50, less than 50% is our optimal target. So we expect it will continue to grow slightly in the next couple of quarters, and then after that it will start to come down as our non-guaranteed business start to outgrow the self-guaranteed business.
Speaker Change:
Speaker Change: Just in terms of what it looks like you're still still ramping it.
Speaker Change: One.
Speaker Change: And do you expect it to stabilize and potentially show profitability.
Speaker Change: Yeah currently.
Speaker Change: Take care of your business at all.
Speaker Change: Around 40% level.
Speaker Change: The.
Speaker Change: <unk> to 50 left.
Speaker Change: Less than 50% is our optimal target.
Speaker Change: So we expect it will.
Speaker Change: Turning to grow slightly in the next couple of quarters.
Speaker Change: After that people start to come down there is a lot in voluntary ecosystem.
Speaker Change: Growth, Okay, Yes, I've got two questions.
Speaker Change: Yeah.
Dale Tiongson: Okay, I don't have any other questions. Thank you.
Speaker Change: Okay I don't have any other questions. Thank you.
Speaker Change: Okay.
Speaker Change: Thank you.
Bruce Orin: Our next question comes from the line of Bruce Orin from Black Lab. Please go ahead. Yeah, thank you.
Speaker Change: Our next question comes from the line of Bruce <unk> from Black lap. Please go ahead.
Speaker Change: Yeah. Thank you.
Bruce Orin: First, I'd like to say I'm delighted that Urim Digital expects to benefit from consolidation in the new regulatory environment. I have two questions.
Speaker Change: First I'd like to say I'm delighted that you're in digital expects to benefit from consolidation in the new regulatory environment.
Speaker Change: I have two questions.
Yuning Feng: First, concerning the six-fold increase provision for contingent liabilities, which has now grown to the largest operating cost and expense. Why would a higher volume of loans decrease profitability, especially since delinquency rates have remained stable?
Speaker Change: First concerning the six fold increase provision for contingent liabilities, which has now grown to the largest operating cost and expense.
Speaker Change: Why would a higher volume of loans decreased profitability, especially since delinquency rates have remained stable.
Ning Tang: And my second question is, can you offer any insight into Yiren's dividend commitment for later this year? Thank you. Okay. To answer your first question about the six times the provision, it's because of we are taking a bigger position in the self-guarantee business. With that, according to the accounting standards, we need to make the relevant provisions immediately, even though the revenue will come on a month-by-month basis. So with that, that's why we see a hit on our Unknown Speaker 1. Thank you. Unknown Speaker 2. Thank you. As the loan volume grows, in the self-guarantee. So I think that answers the kind of discrepancy between why the delinquency is low, but the provision is high, because it's more like you're not counting treatment.
Speaker Change: And my second question is can you offer any insight into your dividend commitment for later this year. Thank you.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: To answer your first question.
Speaker Change: About six times the capital patient, it's a it's because.
Speaker Change: E ticketing.
Speaker Change: They could potentially into.
Speaker Change: South guarantee business with that according to the accounting standards, we need to.
Speaker Change: Make the.
Speaker Change: The relevant provisions.
Speaker Change: You can do.
Speaker Change: That revenue will come on a month by month basis. So.
Speaker Change: That's why we see it.
Speaker Change: Tom.
Speaker Change: On our margins.
Speaker Change: S T E.
Speaker Change: Our loan volume growth.
Speaker Change: Sales guarantee.
Speaker Change: Assets.
Speaker Change: So I think that answered a kind of discrepancy between wide delinquencies level, but the provision is hard because it's been more like it.
Speaker Change: Treatment plus.
Yuning Feng: So, for your second question about the dividend. So, I think we... It's a... we are committed to. to our 30 Annual Dividend Policy to ensuring the consistent value is returned to our investors. So according to our annual dividend policy current dividend payout. Unknown Attendee, Na Mei, Ning Tang, Zafar Aziz, Yuning Feng, Chunjiang Ji, William Hui, Yuning Feng, Chunjiang Ji, William Hui, Yuning Feng, Chunjiang Ji, Yuning Feng, Chunjiang Ji, of the prior six months period. So while our payout ratio reached around 20% when we last... Dachuan, Yuehäng Li, Zhonglei Wang, Zhang Yixing, Zhang T Teresa Zhang Wang Zhang Teresa Zhang Wang and we invest in the high potential opportunities and innovation to thrive.
Speaker Change: Yes.
Speaker Change: Well it goes back to the question about the dividends.
Speaker Change: <unk>.
Speaker Change: I think we.
Speaker Change: If it takes off we are committed to.
Speaker Change: Due to our family meal.
Speaker Change: Sandy annual dividend policy to ensuring consistent value is returned two hours reduction.
Speaker Change: So according to our spending here in New York ticket and policies are occurring.
Speaker Change: Out.
Speaker Change: The payout ratio extensive.
Speaker Change: Around 10% based on the earnings of that.
Speaker Change: Off the prior six months period.
Speaker Change: While our payout ratio reached around 20%.
Speaker Change: When you love.
Speaker Change: Payout of dividends remain so looking forward we are carefully.
Speaker Change: The balance between increasing shareholder return.
Speaker Change: And we are investing in a high potential opportunity.
Speaker Change: And to try.
Yuning Feng: A more sustainable long-term growth, so this strategic evaluation will guide us our decision to maximize the value of all stakeholders.
Speaker Change: A more sustainable long term growth.
Speaker Change: This strategic evaluation with cash sufficient.
Speaker Change: Sufficient to maximize the value.
Nick Holmes: Nick Holmes.
Yuning Feng: Yeah, and then what we'll do, we'll make the announcement next. Pengiali, Yu Zhogang, Yu Qiang, Zuo Gangushen, Ma Niuzheng, Song Zi, Seng Xing, Zeng Cang, Zheng Wan, Zhou Siwen, Zheng Leang, Cheng Rui, Zhen Qing, Wei Kexin, At the same time, we are also noticing and comparing the dividend policies of our peers. And then we will make a decision that will maximize the value. Hope that answers your question.
Speaker Change: And no one will do cash dividend not called that will make the announcement.
Speaker Change: They had been a semiannual.
Speaker Change: But at the same time, we are also low.
Speaker Change: Noticing in comparing.
Speaker Change: Yeah.
Speaker Change: And policies of our peers.
Speaker Change: The evil.
Speaker Change: And then we will make a decision that will maximize suggests the guidance.
Speaker Change: Sure.
Speaker Change: Hope that answers your question.
Yuning Feng: Yes, I have a small follow-up. I failed to completely understand with the higher provision for contingent liabilities, is that a one-off for this quarter or can we expect levels of that that level for continuing quarters? Thank you. Every time when we increase the loan balance in this self-guarantee loans, then we need to increase our provision proportionally. So, so I think as we, as that The low volume electronically. Yiren Wang, Yuning Feng, Zafar Aziz, Yuning Feng, Chunjiang Ji, William Hui, Yuning Feng, The provision will start to turn off, but at the same time, the loan that we made earlier in Q1, we will start...
Speaker Change: Oh, yes.
Speaker Change: A small fault.
Speaker Change: Yeah.
Speaker Change: To completely understand with a higher provision.
Speaker Change: Provision for contingent liabilities as kind of a one off for this quarter or can we expect.
Speaker Change: Liberals.
Speaker Change: That level for continuing quarters. Thank you.
Speaker Change: Okay.
Speaker Change: I think every time.
Speaker Change: Kris.
Speaker Change: The local parlance is.
Speaker Change: Sales guarantee.
Speaker Change: Loans okay.
Speaker Change: Okay.
Speaker Change: You need to.
Speaker Change: HR proficient proportionate.
Speaker Change: So.
Speaker Change: So I think as we.
Speaker Change: Uh huh.
Speaker Change: The lower volume electronically.
Speaker Change: Sure.
Speaker Change: Continue to lighten as we expect peak at around Q2 Q3.
Speaker Change: Okay.
Speaker Change: Uh huh.
Speaker Change: After Q2 after Q3s nasal CPAP.
Speaker Change: The provision will start to tell us, but at the same time the loan definitely meet.
Speaker Change: In Q1.
Speaker Change: Scott.
Yuning Feng: Yuning Feng, Chunjiang Ji, William Hui, Yuning Feng, Chunjiang Ji, William Hui, Yuning Feng, I think the way it works is when that long parlance reaches a steady state, the provision will, the change in provision. I hope that answers your question. And back to you, Operator. Thank you. This concludes our question and answer session for today. If you have any further questions, you can please connect the IR team of Yiren Digital. The conference has now concluded. Thank you. Thank you for attending today's presentation. You may now disconnect.
Speaker Change: Getting more.
Speaker Change: Interest revenue from it so that's more or less offsets.
Speaker Change: Las Vegas contingency Microsoft.
Speaker Change: I think the way it works is when.
Speaker Change: When that loan balance.
Speaker Change: Each state provision for that.
Speaker Change: Change in provision will stop.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: Hope that answers your question.
Speaker Change: And thank you operator.
Speaker Change: Thank you.
Speaker Change: This concludes our question and answer session for today.
Speaker Change: If you have any further questions you can please connect the IR team of year in digital.
Speaker Change: The conference has now concluded.
Speaker Change: Yes.
Speaker Change: Thank you.
Speaker Change: Thank you for attending today's presentation you may now disconnect.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: [music].