X Financial

Hello and welcome to the ex-financial fourth quarter 2024 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. 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 two. 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 today's call. The company's financial results were released earlier today and are available on our Investor Relations website at ir.shouyingroup.com. On the call today from X Financial are Mr. Kent Lee, President and Mr. Frank Suyajian, Chief Financial Officer. Additionally, we are delighted to welcome Mr. Noah Kaufman to our company. He brings 20 years of experience in growth strategies, corporate and financial transactions, as well as financial and operational improvements in the global financial markets. Before joining X Financial, he served as Head of Strategic Financial Planning and Analysis at the Intercontinental Exchange, where he played a key role in capital allocation and global business strategies. Mr. Kaufman will be responsible for leading our engagement with the U.S. capital markets, including investor relations and strategic financing initiatives. Mr. Lee will provide a brief overview of our operations and business highlights. followed by Mr. Jin, who will review the financial results. Afterwards, Mr. Lee, Mr. Jin, and Mr. Kaufman will be 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 the Private Securities Litigation Reform Act of 1995. Such statements are These are management's current expectations and involve knowing and unknowing 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 achievements to differ materially from those described in these statements. Further information on these and other risks can be found in our SEC findings. 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. It's now my pleasure to introduce Mr. Kent Li.

Thank you, Victoria, and hello everyone. We are very pleased to conclude the year with outstanding operational and financial results in the fourth quarter. Total loan volumes exceeded our guidance with RMB 32 billion facilitated in Q4 amounts, a 24% year-over-year increase for the quarter. For the full year, total loan volumes reached RMB 104.9 billion, reflecting a stable performance compared to 2023. This growth was fueled by disciplined underwriting, strengthened asset quality, positive macroeconomic tailwinds that supported borrower demand and lower funding costs. In the second half of 2024, China's government implemented monetary and fiscal stimulus measures aimed at stabilizing core economic sectors, notably real estate, and enhancing market liquidity. These policies lowered the funding costs and fostered healthy borrower demand in the personal finance market. As a result, we saw meaningful revenue and profitability growth, with Q4 net income more than doubling year over year. Strong asset quality performance. Asset quality continued to strengthen significantly throughout the year. At the end of Q4, the delinquency rate for loans overdue by 31 to 60 days improved to 1.17%. from 1.57% a year ago. The 91 to 108 days overdue delinquency rate declined to 2.48% from 3.12% last year. These improvements reflect the effective risk management practices and the discipline underwriting standards. 2025 outlook and growth strategy. Looking ahead into 2025, The Chinese government has reiterated the importance of the private sector as a key driver of economic innovation and sustainable growth. Recent regulatory guidance from the National Financial Regulatory Administration, NFRA, further reinforces this stance, with policies aimed at expanding access to consumer credit, lowering borrowing costs, and supporting consumption-driven economic growth. While this development created a more accommodative environment for financial institutions, our primary focus remains on leveraging technology to enhance financial services efficiency. Through AI-powered risk analytics, automated underwriting models, and embedded FinTech solutions, we continue to empower our financial institutional partners in optimizing loan origination, creative risk management, and borrower engagement. ensuring they can navigate this involving regulatory landscape with precision and agility. Accordingly, we expect total loan volumes to increase by approximately 30% for the full year of 2025, supported by both organic demand and a more stable regulatory environment. Despite the usual seasonal impact of the Chinese New Year, We anticipate sequential growth in total loan volume in Q1, 2025, as digital financial solutions become increasingly integral to expanding responsible credit access while maintaining discipline in risk management. Strategic AI investments. At Xfinancial, we continue to expand our strategic investments in AI, leveraging cutting-edge models such as DeepSeek, Alibaba's Tongyi Qianwen, and the bystands across our operations. AI now powers advanced customer service robots, intelligent agent assistance, targeted marketing campaigns, including AI-generated short videos for platforms like TikTok, streamlined early-stage collection efforts, significantly enhanced efficiency and customer engagement. In software development, we have implemented AI-driven auto-coding tools, such as Cursor, accelerating development and system optimization. Additionally, our multi-model AI risk management system delivers over 95% accuracy through sophisticated contextual analysis and advanced image recognition technologies to identify early indicators of credit risk. Looking ahead, we remain committed to further integrate AI into our strategic decision-making process, particularly in risk modeling and credit policy. to continue enhancing operational effectiveness and customer experience. With that, I will now pass the call to our CFO, Frank Jin, for detailed financial results.