X Financial

Hello and welcome to the ex-financial second quarter 2023 earnings conference call. All participants will be in listen only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then 2. Please note this event is being recorded. 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 us today. The company's results were released earlier today and are available on the company's IR website at ir.xiaoyingroup.com. On the call today from X Financial are Mr. Ken Lee, President, and Mr. Frank Fu-Ya Zheng, Chief Financial Officer. Mr. Li will give a brief overview of the company's business operations and highlights, followed by Mr. Zheng, who will go through the financials. They are all available to answer your questions during the Q&A session. I remind you that this call may contain forward-looking statements under the safe harbor provisions of Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and current market and operating conditions and relate to events that involve known or unknown risks, uncertainties, and other factors, all of which are difficult to predict and many of which are beyond the company's control, which may cause the company's actual results, performance, or achievements to differ materially from those in the forward-looking statements. Further information regarding leads and other risks, uncertainties, and factors is included in the company's filings with the U.S. Securities and Exchange Commission. The company does not undertake any obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required and allowed. It is now my pleasure to introduce Mr. Ken Lee, Misa Li, please go ahead.

Hello, everyone. We are delighted to enter the first half of 2023 with outstanding operational and financial performance in the second quarter. We continue to execute our proven strategy and maintain our growth momentum. In the first half of the year, the total known facilitation and origination amount reached nearly RMB 50 billion, an impressive increase of over 55% year-over-year. Our top line improved by 30%, while our bottom line nearly doubled in the first half, underpinned by our proven business model, consistent asset quality, and optimized operational efficiency. Furthermore, our net income per basic ADS for the first half of the year grew more than 130% year-over-year, driven by our robust profitability and dedication to rewarding shareholders through our share repurchase program. During the second quarter, our total loan amount facilitated and originated increased by 53% year-over-year and 7% quarter-over-quarter to RMB 26 billion, in line with our expectations. With the total outstanding loan balance reaching RMB 45 billion at the end of June 2023, We continue to strengthen our risk management system to maintain healthy asset quality, with the democracy rate for all outstanding loans past due for 31 to 60 days remaining stable at 0.96 percent at the end of June 2023, and the democracy rate for all outstanding loan past due for 91 to 180 days at 2.5 percent, significantly improved from a year ago. We are proud of our consistent high-quality risk control and stable prime borrower space, which have been well received and recognized by our institutional funding partners. We will continue to work together to meet the financing needs of consumers and SMEs in support of China's economic recovery. On the regulatory side, with the recent settlement of fines imposed on some large financial platforms by the government, The market believes that the industry-wide ratification is expected to come to an end and a more stable regulatory environment is expected. Financial regulatory authorities are now shifting their focus towards regular supervision. As a highly responsible company, we always operate in full compliance with regulations and laws and will continue to prioritize financial consumer protection. Looking ahead to the second half of 2023, we are confident in our ability to achieve sustainable goals and enhance shareholder value. The normal regulatory environment provides a solid foundation of our continued goals and success. We remain committed to executing our share repurchase and dividend program to reward our valued shareholders. Now, I will turn to the Court of Frank, which will go through our financials.