Lufax Holding Ltd American Depositary Shares (each representing twenty (20) Ordinary Shares)

Ladies and gentlemen, thank you for standing by and welcome to the Lufax Holdings third quarter two thousand and twenty six earnings call. At this time, all participants are in a listen only mode. After the management's prepared remarks, we will have a question and answer session. Please note this event is being recorded. Now, I would like to hand the conference over to your speaker host today, Ms. Qian Lu, the company's general manager of board office. Please go ahead, madam.

Thank you very much. Hello everyone and thank you for joining us on today's call. Our financial and operating results were released by our Newswire services earlier today and are currently available online. Today you will hear from our director and CEO, Mr. Ji Xiang, who will share recent developments and provide insights into the company's overall performance. Our CFO Mrs. Liu Jia who joined LuFax in October will then walk you through our financial results. Before we continue, I would like to refer you to our safe harbor statement in our earnings press release which also applies to this call as we will be making forward-looking statements. With that, I'm now pleased to turn over the call to Mr. Ji Xiang, Director and CEO of LuFax.

Thank you, Xinyan. Thank you all for joining our third quarter 2026 earnings call. I would like to begin with two updates. First, trading in our ordinary shares on the Hong Kong Stock Exchange resumed on September 24th, 2026. We thank all shareholders and the broader investor community for your patience and support throughout this process. Second, I'm actually very pleased to welcome Ms. Liu Jia who joined us as CFO in October. Ms. Liu Jia brings extensive experience in audit, banking, and financial management of listed financial technology companies. Most recently as CFO of CITIC AI Bank. She will walk you through our financial results following up my remarks. Let me now share an update on the macro and regulatory environment. The operating environment for small and micro business owners remained challenging in the third quarter, and financing demand stayed weak. Chenggong Business School's SME Development Index remained below the 50-point boom and bust line. indicating that the financing environment for small and micro enterprises remains under pressure. Consumer finance demand was also subdued. As of the end of September, household consumer loans declined 3.6% year-over-year, domestic consumption remained soft, consumer confidence continued to be cautious, and households continue to prioritize balance sheet repair. On the regulatory side, the industry continues to move towards greater standardization in the third quarter. Amid the intensified enforcement against the debt collection industry, both industry peers and LUFEX have seen notable volatility in risk performance. The industry is currently recalibrating its compliance boundaries, Since the second quarter, tightening industry liquidity and heightened regulatory scrutiny, including collection practices, have led us to observe rising risk across both small business owners and consumer finance lending markets. While we believe the tightened regulatory environment will benefit the industry in the long run, it has waited on the near-term risk performance. In response to the changing macro and regulatory environment, we maintained a very prudent operating strategy. In the third quarter, we continued to implement our selective customer strategy, adjusted our post-loan collection approach, and continued to deepen our refined operation. Firstly, Under our selective customer strategy, we proactively reduced and exited certain high-risk customer segments and adopted a more cautious approach towards downmarket customer segments. Second, we continue to leverage our in-house collection force and adjust our post-loan collection strategies. On the recovery side, we increase our use of judicial recovery channels and leverage the models to identify high-quality accounts, improving recovery efficiency. Our in-house collection team provides dedicated internal collection capabilities, mitigating our reliance on third-party collection service providers. We will continue to closely monitor regulatory developments and reinforce compliance controls across the collection process, including enhanced compliance training to ensure that All collection activities remain within the applicable legal and regulatory framework Third, we continue to deepen our refined operations We continue to deploy differentiated products tailored to local industries and customers across different regions Our industry prism program now covers over 700 sub-industries offering industry specific product that meets the industry specific requirements of our customers. We have also established a dedicated direct sales team for consumer finance that targets quality salary customers. This team is moving our customer engagement model from single product sales to a full lifecycle relationship manager approach. enabling long-term customer value realization. In addition, we are deepening our management of existing customers, leveraging our license advantage. We are building a diversified product portfolio and a multi-channel customer management system to increase repeat borrowing. We are also deepening our use of AI to enhance operation efficiency. Our AI-powered digital twins have added new features providing end-to-end AI enablement from customer acquisition to customer management and improving the efficiency and quality of our sales teams. Looking ahead, we will further extend this AI capability to risk management. On the pre-loan side, we plan to further upgrade our risk models by leveraging AI capability, enhance identification of risky customers, and drive the optimization of our customer portfolio structure. In post-loan management, we aim to further deepen collection reform, expand application of AI-driven collection, and improve collection effectiveness through intelligent assistance. Now, turning to our operating model, operating results. Total new loan sales in the third quarter were 58.3 billion RMB up 2.5% year-over-year and up 14.1% from the second quarter Consumer finance continued to lead our growth with new loan sales up 25.2% year-over-year to 39.7 billion RMB representing 68.1% of total new loan sales Our total outstanding loan balance was 167.1 billion RMB as of the end of third quarter broadly stable from the second quarter and down 11.9% year-over-year Our consumer finance loan balance grew 19.8% year-over-year to seventy point five billion RMB. Consumer products with smaller ticket sizes and short tenure carry lower risk in the current environment. Over the long term, supported by policies to expand domestic demand and boost consumption, we believe consumer finance continue to hold growth potential. Turning to asset quality, Our risk performance in the third quarter was negatively impacted by the macro and the regulatory environment especially the intensified enforcement actions against the debt collection industry Our CM3 flow rate for the total loan was 1.2% in the third quarter compared to 1.0% in the second quarter CM3 flow rates for the unsecured and secured loans were 1.2% and 1.1% respectively, compared to 1.0 and 0.9% in the second quarter. Or DPD 30 plus, the delinquency rate for total loan enabled, excluding consumer finance subsidiary, was 5.5%, down from 5.8% in the second quarter. and or DPD 90 plus delinquency rate was 3.2% down from 3.7% in the second quarter. As of the end of third quarter, the NPL ratio for consumer finance loan was 1.3%, stable from the second quarter. Now, let me turn to pricing and funding costs. The average pricing under Rongyi Loan was 20.3 in the third quarter, and the average pricing of Consumer Finance Loan was 16.4%, as we continue to implement our selective customer strategy. On funding, our cost of funds continue to decline. Our cost of funds by balance, excluding consumer finance, was 3.6% in the third quarter, down 20 basis points sequentially and 80 basis points year-on-year. Finally, we continue to advance our compliance enhancement efforts. Under the leadership of our board of directors, we are further strengthening our internal control and compliance standards. Going forward, we will remain prudent in our operation, focused on quality growth and committed to delivering long-term value to shareholders. With the onboarding of Liu Jia as the CFO, I am confident that our financial reporting capability and quality will be further enhanced. With that, I will now turn the call over to Liu Jia, who will walk you through our financial results. Thank you.