Zhongan Online P&C Ord

To attend this 2024 InfoResult call of China Online Online I am the Director of the Investor Relations and Capital Market. My name is Linh. First of all, please allow me to introduce the management, the General Manager of Zhongwan and CEO Jiang Xin, Mr. Li Kaofeng, the Chief Investment Officer and Chief Financial Officer, the Vice General Manager and the Secretary of the Board, Mr. Wang Ming, and also Wei Xu, the President of International of Zhongwan. Now please give the floor to Mr. Jiang Xin. All right, so good afternoon, dear investors and analysts. I am Jiang Xin, the General Manager of Zhong An Online. I would like to welcome everybody to attend the 2024 Interim Result Conference of Zhong An Online. And also, I'm appreciating your continuous attention and support to Zhong An. 2024 is the beginning of the new decade of Zhong An. And also in the recent release, 2024 Fortune China 500 list, Zhong An ranking has improved by 37 places to 460 years and reflecting a summary and recognition of our achievements over the past decade. Facing the complicated macro external environment in recent years, we are here to the mission of empowering the finance business with technologies and providing insurance service with a caring hand and embrace the value of the best performance of yesterday is the minimum requirement of today. focused on listening to our users' feedback, improving user experience, and also staying true to our original aspiration and driving the long-term sustainable development of Zhong An. In the first half of 2024, we achieved a total premium income of 15.23 billion RMB, a year-on-year increase of 5.4%, and in terms of The total premium return, we maintain a market share of over 20% in this Internet P&C insurance sector, holding the first position. On a new accounting standard, our insurance service revenue in the first half of the year reached 1.588 billion MMB, a year-on-year increase of 19%. And also, the combined ratio for underwriting was 97.9%. maintaining a healthy, unwinding profitability. Also with a commitment to the long-term and prudent operation, so our net assets have continued to grow and our solvency remain ample with a comprehensive solvency adequacy ratio of 224% at the end of the first half of the year. We were also consistent receive issue credit rating of BA1 from Moody's and A- from AMBEST. And that's one of the strategic engines of ZHUAN. The technology business has been benefited from the ongoing digital transformation and the domestic and global financial sectors. The first half of the year our technology export revenue increased by 65.5% year on year to 4.24 billion RMB. But the domestic technology output revenue reaching 319 million RMB, a young year growth rate of around 112.7%. And this growth rate was primarily driven by the expansion of new clients in the financial, retail, and manufacturing sectors, in addition to consolidating our insurance industry client base. This has resulted in rapid growth, supporting the launch of multiple products under the John Wayne Business Growth and Infrastructure Series, And also due to the increase in the prototype, the revenue and improvement in operational efficiency, the technology segment reduced its loss by 165 million in the first half of the year, comparing to the same period last year. And now taking a look at the Hong Kong Digital Bank, VA Bank performance, maintaining a very strong growth momentum this year, achieving a net income of 255 million Hong Kong dollar in the first half of the year with a yearly increase of 45.9%. And the rapid growth in this particular income has led to the realization of a scaled effect, proving the cost to income ratio and also narrowed by 9.1 million Hong Kong dollars in the first half of the year. And also we have realized that the overall profit attributable to the parent company of 55 million Hong Kong dollars. And also, this is the very critical year for our 14th five-year plan and response to the guiding operation and promotion of high-quality development of inclusive finance issued by the National Financial Supervision Administration Commission. We have remained committed to empowering with technology, providing innovative, inclusive, and diverse insurance products. And also, fulfilling the insurance role as a buffer in the economy and stabilizer in the society. And also, we are going to develop the small and diversifying and convenient inclusive insurance products tailored to the internet scenarios and enhancing the convenience and accessibility of insurance services. The first half of the year, we provided health and accidental insurance coverage for over one million new citizens and flexible workers, including the food delivery riders and couriers and rail-hailing drivers. Also, we launched over 100 exclusive products covering more than 1 million individuals with chronic illnesses and also standardized health conditions. We also develop insurance products for groups including women and elderly and creating a safety net for them. And also, furthermore, addressing the pain points of domestic micro and small enterprises in this operation, we provided the multi-line insurance coverage including property insurance and liability insurance for over 1.33 million micro and small enterprises helping to enhance their risk resilience. In the first half of 2024, in our proprietary operating channels, we have adjusted our marketing strategies focusing on the user operation in the private domain and improving the user experience, laying a solid foundation for the long-term user value realization. And also around the four ecosystems, we have also upgrade the services of health, family, and pets, continue to enrich in our product matrix to provide the users and consumers with convenient, economical, and comprehensive protection. In the first half of the year, for all the proprietary channels, 40% of the premium was contributed by the old users from 2019 and even older, showing the company of join to our users. In the first half of 2024, the average number of policies held per user reached 1.6 in our proprietary channel. and 667 yuan for the average premium per user. And leveraging our self-developed data platform and the customer middle platform, we have achieved a real-time data sharing across the entire ecosystem. And also we are servicing the whole lifecycle of the users. In the first half of the year, the total premium provider channel was 3.6 billion RMB. And also with additional policies purchased, and by contributing to 31% of the total premium and also the renewal rate increased by 3.2 percentage points and reaching 95% year on year. And next, just now I have introduced the overall situation and next I would like to talk to you about the progress of each business segment in the first half of the year. The first is the health ecosystem. In the first half of 2024, we have provided the health coverage to approximately 12.39 million insured and with a total premium region or the capital region 343 RMB and also in terms of the inclusive finance or healthcare we have upgraded and iterated the upgraded version of a million healthcare coverage and also this increased the accessibility of the insurance service and expanded the coverage to the pre-existing condition people, individuals with chronic illnesses and special occupational group. And also tapping into the market amount. Also to address the unmet needs or pain points, this inclusive products including Dong Min Bao were covering over 100 exclusive products in the first half of the year we have the total premium growth rate exceeded 2.7 times. And also, our outpatient and merchant insurance products extended the service scenarios from the inpatient care to outpatient care, meeting users' daily high-frequency medical needs and also achieving rapid growth. So this total premium increased a lot, and the total premium reached 427 million MMB with a yearly increase of 321%. Apart from that, our short-term critical index product became also the primary choice for joint users to enhance their coverage, and this has achieved a very steady growth in the first half of the year with the total written premium of exceeding 800 million MMB. and also we are developing the medium to high end medical insurance products and also this year we have been also trying to understand the pain point of many users and also we have also launched some of the other wide spectrum and wide range covered products and meeting the people's basic needs of the outpatient and emergent visits and these products were welcomed by the public and we had a very impressive premium growth. Next, taking a look at the digital life ecosystem, in the first half of 2024, the total premium reached 7.4711 billion RMB in the first half of 2024, benefiting from the sustained prosperity of the e-commerce industry and also the rapid growth of innovative products like the pet insurance, scenario-based accident insurance and household insurance, etc. In this e-commerce segment, we provided the users with an integrated solution covering the entire e-commerce transaction chain, including the return shipping insurance, quality assurance, account security, and logistics protection. In the first half of 2024, our e-commerce business segment captured the opportunity presented by the overall prosperity of the e-commerce industry, maintaining a rapid written premium growth. In the travel and aviation business segment, we adopted a more differentiated strategy, strengthening the travel development and product R&D in response to the graduate recovery of vocation and outbound travel, while improving the business quality. In terms of innovation business segment, the pet insurance achieved over 2.8 times premium growth, with in total 1.46 million new pet owner uses in the first half of the year and also based on extensive also claims data analysis we updated and iterated the original 107 covered diseases in our pet major illness insurance product covering more common diseases among pets enhancing the product competitiveness and also releasing the product value. As of June 30th of 2024, our pet insurance service network further expanded to over 18,000 offline pet hospitals and service institutions, covering major cities nationwide. The pet insurance service as the carrier for services, providing over 930,000 services in the first half of the year, a year-on-year increase of three times and one out of every three PAT insurance users actively choosing to use our PAT services. And in addition to the popular PAT insurance, during the reporting period we continued to closely follow the development trend of new consumption and very quickly launched several innovative insurance products based on the data analysis and tracking of the users' lifestyles. Together with the ecosystem partners, we are exploring new scenarios in the food delivery sector covering the pain points such as the food safety and delivery delays with related product premiums increasing by three-fold. So overall speaking, we are pretty much promoting the healthy China and the fitness China. also focusing on those fashionable lifestyle groups, covering 10 different scenarios for exercise and sports, and covering the extended insurance of tennis, riding, sports on winter and snow, et cetera. And now taking a look at the consumer finance ecosystem in the first half of the year, facing challenging macroeconomic and industrial environment We practically and strategically reduced our business scale. At the end of the first half of the year, the balance of insured loans was 23.1 billion RMB, down by 15% comparing with the same period last year. We operated prudently, focusing on small, dispersed, and short-term internet consumer finance assets, with the borrower primarily being near prime consumers aged at 30 to 50, 45, and the Average loan amounted was 7,500 yuan, with the average duration of about 10 months. Leveraging the big data and other technological enablers, we implemented real-time risk controls, strengthened post-loan monitoring, and achieved sustained underwriting profitability. And last but not least, taking a look at the automotive ecosystem, we achieved the breakthroughs in scale, quality and service in the first half of the year. We actively embrace the wave of new energy vehicles with the total written premiums for the new energy vehicles increasing by 215% year-on-year and now accounting for over 10% for the total auto insurance premiums. And in terms of the customer experience, we upgraded our one-stop intelligent video claims service using artificial intelligence and other technologies. At the end of July, the coverage rate of Joann's video claims cases, which has become the main characteristics of our company, and we have the claim cases reached 50%. And with this technology, we could complete it the extent inspections in as fast as 6 minutes and reducing the average inspection time by 85% compared to the offline inspections. At the same time, we enhanced the risk identification and alerts, focusing on underwriting private cars and achieved a combined ratio for auto insurance that outperformed the initial average in the first half of the year. So next, for the technology. segment or ecosystem. We're going to hand the call over to Wanming. All right. Thank you very much, Simon, for your introduction. And now please allow me to share with you the progress of technology segments in the first half of the year. We have continued to invest in cutting-edge technologies like artificial intelligence and also reshaping the every link of the insurance value chain through technology. Internally, AI has improved the efficiency across various aspects from product marketing Risk Control, and to Daily Operations. So in Consumer Service, we introduced the full AI-based humanoid interactive service, which increased the efficiency of our customer service representative by over 15%. In the health insurance claims process, we integrated the intelligent camera service to enhance the experience of submitting materials and filing claims. We also launched the AI-based Claims Compass online customer service bot, seemingly reducing the need for human assistance. In addition, we established an intelligent data collection platform and an intelligent review platform incorporating large-model and the small-model material classification integration solutions, and these innovations reduce the human labor and time cost, effectively improving the review efficiency and further enhancing user experience. In technology export side, the Chinese technology output business which relies on deep expertise in insurance technology achieving significant breakthroughs in regulatory technology, data integration, and intelligence insurance core systems, intermediary middle office, and insurance digital marketing, maintaining rapid growth for our business. In the first half of 2024, the group's total technology export revenue reached 424 million RMB, increasing by 65 year-on-year. As of June 30th of 2024, we have first service 89.2 thousand clients and signed in total 6 new clients from insurance industries and also 7 from new clients in banking, brokerage and funder industries and also benefiting from the rising demand of domestic information technology innovation and also promotion of Digital China Initiative in total we have reached 392 million RMB for this domestic technology output segment, increasing by 171% year-on-year. And on one hand, our products such as the property insurance core system, intelligent marketing, and data intelligence have signed by many domestic insurance industry clients. Also, from the other hand, We have the continued expansion of our boundaries extending to financial industries such as the brokerage and banking and further cover to the marketing infrastructure operations and other products that are also helping clients to achieve the rapid business growth and accelerating their digital transformation. It is worth mentioning that in the terms of the business product series we have product the end-to-end and self-developed IFRS 17 system solution which is compatible with multiple domestic chips, servers and database systems and has assigned by 15 leading domestic insurance companies covering both life and property industry and the contract amount has grown rapidly. In the future we will continue leveraging the technology power and capability of ZHUAN and continue to construct the digital economy and digital China. Now let's hand the call over to Wei to talk to us about development of ZHUAN International. Thank you very much, Wanming. And now I am responsible for telling you something about the international business. And also now we have realized this technology export business of international by ZA Tech. established in 2013. We have established our technology and solutions based on Graphene and Fusion and collaborate with the well-known insurers like AIA, Generali, Prudential, and Zurich. Also, we have partners with digital platforms like Carol and PayPay, continuing building and also expanding the embedded insurance businesses. Over the six years, we have expanded into 12 countries and regions globally and established offices in 16 countries and regions, including Tokyo, Thailand, Germany, Denmark, France, and Ireland. In May of this year, we innovatively launched the EcoCulture Drone Damage Insurance Production Solution with DJI in Thailand, leveraging our extensive overseas collaboration network and Solar Insurance Technology capabilities to quickly support the DJI's related projects in Thailand. In March, VA Tank completed a US$35 million Series A financing, attracting global renowned institutional investors and officially rebranded as Peak3 with a new brand facing the world. The company will accelerate expansion in more regions and speed up its layout in AI and big data driving the global insurance industry's digital transformation towards intelligence. And also, in terms of business data, during the reporting period, we have reached 132 billion RMB for the technology output revenue. And also, we have reached 127 billion RMB for annual subscription revenue, IRR, with the loss significantly narrowing. In addition to the overseas technology export business, the Hong Kong Virtual Bank, the EA Bank, continues to advance its vision of building one-stop digital financial service platform in Hong Kong, providing rich, convenient, and inclusive financial services to retail users and small and medium-sized enterprises. The first half of the year, the CA Bank's income was very good. And also in total, we have realized the total asset of almost 20 billion Hong Kong dollars. Comparing with the end of 2023, 43.2% were increased. The balance of the deposit, HK$16.8 billion, increasing by 43.1% versus the end of 2023. Because of the interest hike cycle and enriched loan products, the net spread has been improved to 2.21% from 1.87%. and also the net income was 252 million Hong Kong dollars, increasing by 45.9%. Non-interest income accounting for 18.4%. At the same time, our fund business also saw substantial growth this year. By the end of the mid of this year, we had in total the reserve or balance of 2.3 billion yuan, increasing by 23 times. Also, the benefit on the U.S. stock trading service further enhancing the financial product matrix for serving the clients. So while we are increasing our efficiency, and also you can see that our overall cost has been reduced. The first half of this year, this figure was 119%. Comparing with the same period, it was lowered by 80 percentage points. And also the bank loss has been narrowed. Net loss was HK$190 million, and we have been improving by 71.7%. So looking ahead, we will continue to upgrade our user experience and creating more value for users' future digital financial experience. We will enhance and support the development of financial technology in Hong Kong, building a financial center with global financial influence, promoting financial inclusion, and also drive quality growth at VA Bank and that we are confident in achieving profitability. Now, let's invite Gaurav Phong to share with you the financial performance in the first half of the year. All right. Thank you very much, the management, for your review of the past. And now, I'll be responsible for introducing the financial performance and investment situation. Online P&C Ord Online P&C Ord Online P&C Ord Online P&C Ord Online P&C Ord Online P&C Ord and also we have the 4.876 billion RMB reached in terms of the insurance service revenue. Area increase of 22.7%. Digital life ecosystem with a continued prosperity of the e-commerce industry. We have rapid growth of our innovative products like the pad insurance, et cetera. The insurance service revenue was 7.07 billion RMB in the first half of the year. Area increase of 24.2%. Consumer finance ecosystem. facing the pressure from the uncertain macroeconomic environment and industrial challenges, we adopted a more prudent operating model and actively scaled down the business In the first half of the year, our consumer finance ecosystem insurance service revenue was 2.28 billion RMB and a year-on-year decrease of 1.7%. Automotive ecosystem, we focus on underwriting in private car sector and also continue to embrace the wave of new energy vehicle. And in total, the insurance service revenue reached 863 million RMB, year-on-year increase of 24.2%. In the first half of the year, and the particular underwriting overall combined ratio in the first half of the year was 97.9%, marking the fourth consecutive year for underwriting profitability. Combined ratio was 60.7%, combined expense ratio 37.2%. The combined underwriting ratio increased by 2.1 percentage points compared with the same period last year, and also with expense ratio improving by 1.5 percentage points. Breaking down by ecosystem. The health ecosystem, we have a combined ratio in the first half of the year was 95.7%, up 3.2 percentage points. And also the overall loss ratio remained stable at 38.1%, while the combined expense ratio rose to by 3.1 percentage points. And also mainly due to increased investment back-end service infrastructure to enhance user experience for insurance applications and claims. Digital Life Ecosystem, the combined ratio remained stable at 99.9% with overall performance consistent with last year. The combined loss ratio was 71.7% up 3.3% points from the same period last year, while the combined expense ratio decreased by 3.2% to 28.3%. The change in cost structure was primarily due to the changes in product matrix. And also facing the macro economy and also the challenges, The consumer finance ecosystem had the combined ratio of 99.1% up 8.4% points year-on-year and due to the 13% point increase in loss ratio to 73.8%. However, since the second half of last year, we have actively scaled down the consumer finance business and tightened the risk controls and leading to an improvement in loss ratio compared with the second half of last year. The quality of online assets and various indicators have been improving quarter by quarter. The expense ratio decreased by 4.6 percentage points due to the lower consumer acquisition costs, and we have focused more on service existing users in line with the year's macroeconomic and industrial cycle. This particular expense ratio was 25.3%. Automotive ecosystems combined ratio improved by 3.1 percentage points, to 94.2%. Combined loss ratio increased by 7.6 percentage points to 66.7% year-on-year, primarily due to the increased travel in the first half of the year. And also the overall kind of combined expense ratio decreased by 10.7 percentage points to 27.5%. Also, on the investment side, we continue to adopt the fixed income plus capital allocation strategy. During the reporting period, the total investment assets of Chung Wan Domestic Insurance Funds amounted to approximately 37.69 billion RMB, of which fixed income investments totaled 28.4 billion RMB, accounting for 75.4%, mainly consisting the bonds and bond funds. Benefiting from the strong performance of the domestic bond market in the first half of the year, we achieved relatively stable returns with a total investment income from domestic interest funds reaching $620 million. And also, we had an annualized total investment yield and net investment yield during the reporting period of 3.3% and 2.3% approximately, respectively, remaining stable. And also in the summary, with the service revenue grow this year, we are achieving continuous underwriting profitability to buy down certain external environment. It is worth mentioning that both technology and also the banking ecosystem significantly reduced their losses in the first half of the year. They also benefited from the continued digital transformation of the domestic and global financial industries leading to a record growth in technology output revenue With the increased proportion of productized revenue and the release of management efficiencies, these technologies segment losses narrow significantly. Also, VA Bank's interest earning asset scale and net interest margin growth drove rapid net income growth and improved the operational efficiency and the scale effects further optimized indicators, such as V8 Bank's cost-to-income ratio and showing the also clear path to profitability for V8 Bank. The company's capital remains a sufficient level, comprehensive solvency-adequacy ratio of 2 to 4% as of June 30th of 2024. We would like to thank the investors and analysts in the capital market for their support and companionship along the way. Looking ahead, in a complex and ever-changing global economic environment, we will continue to uphold the mission and also we will refine our internal operations and remain user-centric and focus on enhancing user experience for everyone. Thank you. Now we're going to have the Q&A. And also, please, first of all, identify yourself before the question and also do not ask more questions Then two questions. Now please announce the way to ask questions. Just to remind everyone that you can press start 1 and 1 to ask your question. But this is only for Chinese line. And now the first question is from from Morgan Stanley. All right. Thank you very much for giving me the opportunity. I am analyst from Morgan Stanley. I have two questions. The first one is on the investment side. We have seen that in the first half of the year, the overall kind of revenue decreased a little bit. So what were the reasons? And also how we are going to face this particular kind of environment. And also we are going to further allocate the resources and what is expectation. The second question is that in terms of the health insurance, So for instance, the revenue of the premium actually decreased, but still the service revenue increased. So what are the reasons of having this particular kind of a difference? And also, could you help us to understand the major breakdown by different insurance types? And thank you very much. Thank you very much for this question. Let me answer the question about the health insurance. And Gautam will answer the rest. So in the health insurance sector this year, we have had that the total premium exceeded the trillion. So it is really promising in the future. We're going to see more product innovation opportunities. Just now in the business review, I have already shared that for the strategy of our development, we still are building around the month and also for health interest we have several products. The first one is represented by personal clinic policy and one million health interest coverage product. This is still our major products and also all the way up to now we've been incorporating all kinds of different value-added services and also helping to enrich the essential drug list and to make sure that this bigger product is vital. And also in terms of the networking hospitals, we have also had a breakthrough. Now in total, we're expanding that from public institutions to private hospitals as well. And in terms of inclusion and inclusive finance, Zhong Minbao as the product is actually positioned as the millionaire claim Health Insurance to the Mass Public. So we're covering the three kinds of people that cannot be covered by reimbursement, the super old and also the current illness patients, the patients with pre-existing conditions. So this particular product lowered down the threshold of underwriting and increased the upper limit on the age and no health announcement and also some of the occupational limits. So this is more inclusive and also more applicable Also, we have been adding some of the non-standardized service like the health checkups and the small drug box, etc. So while we're upgrading this, the total return premium increased a lot. So we hope that Zhongminbao is going to become the next breakthrough edge. And also, we are talking about the outpatient and merchant health insurance coverage and also some of the short-term current illness insurance the particular contribution has been increasing as we have already mentioned that we had a very big potential in this area and last not least I would like to say that originally we were developing some of the value for money health insurance products, but now we're focusing on medium to high-end health insurance sector. Leveraging the internet channel, we are selling the insurance policies to those affluent users. So for instance, the child version of medium to high-end health insurance that we have promoted and covering multiple pain points of the parents and covering more scenarios. for instance, the kind of need of getting outpatient treatments by most of the children. And also in the future, we're going to cover more group of population. And Kaofeng, please answer the question about the investment. Thank you very much. So I think that in total, we have a very good arrangement of the investment. Overall speaking, in terms of the investment, it is pretty much based on the fixed income assets. By the end of June, the overall kind of asset of the investment is 37.7 billion, 75% are fixed income investment, the flat versus last year. 65% are bonds and bond funds. This was also flat versus last year. Among the bonds that we invested, 99.2% of them are having a rating of AA. And with the lower interest rate, with regards to fixed income asset, we are going to actively adjust the duration and also enhancing our yield. Also, we have focused a lot on the changes. By the end of June, we had 6.4% of our investment of shares and funds. And also, in total, we do have some of the adjustment of our allocation and the portfolio strategies. and also we are going to increase and enhance the overall yield and try to reduce the volatility. So the comprehensive investment yield will be higher. In the future, while we are controlling the certain scale, we are going to also focus more on the allocation to those segments with a higher dividend and also to be in line with the long-term economic development mindset of Chinese government. Thank you. Thank you very much. Let's have the next question. Next question comes from from CICC, please. Thank you for this opportunity. I am from CICC. I have two questions. The first one is related to the growth opportunity of insurance products. So how do we actually define the future growth opportunities apart from median healthcare and also the refund insurance? What are the other potential areas that we're going to see the growth? And my second question is about the credit insurance. So we have been tested many times of the trustability of credit insurance, but still the environment is quite stressful towards this business. So how do you plan the credit insurance? in order to maintain the profitability and whether you're confident in maintaining the profitability. All right, thank you very much, Mao, Jingjing, for your questions. Let me answer the first question. In Zhong'an, we always raise the concept of growth by quality. So in order to understand whether the business is growing or not, we have three points. The first one is that whether the future market scale is enough and potential is enough. And second, we're going to consider whether there are some of the un-tipping demands of customers. And also, we can fulfill the mission of providing the insurance product with a warming and caring hand. And lastly, we're going to consider the quality of the long-term business development. And just now, you were talking about several specialty insurance products that we have developed. And they are in line with these three points, as I mentioned. For those, some of the business segments that I already talked to you about. And in the future, we're going to focus on, first of all, the auto insurance. The total premium growth was pretty much higher than the initial average, and profitability ratio was also increasing. And also, in Chinese P&C, the auto insurance is the biggest one, and penetration, of course, of the internet auto insurance is quite low. So for Zhonglan, the auto insurance total premium scale was growing very fast, but still, Our market share is still quite low. So this year, on the service side, we have been doing some of the high techs and trying to differentiate ourselves from, for instance, by the end of the July, we were developing the video-based claim service and had a little bit of breakthrough. At the current stage, we can have around 50% of the claims that are done over the line or on the line. And looking in the future, we're going to seize the opportunity of combining internet technology with auto insurance, and hopefully that the total premium will be further increased. And the second opportunity is the digital lifestyle ecosystem. And on top of the e-commerce and travel business, we have been extending the innovative products to other areas, like the pet insurance. And we have more and more innovative products, taking the pet insurance as example, We have upgraded the basic protection based accidental insurance and also emphasizing on critical illness insurance for pets This is a very good mitigation of the missing the mom and also this year we hope and we're having hope that By leveraging our own technology advantage. We're able to for instance, you know do more innovations because of a better pricing and and also better design of the products and around the whole China we've had almost 100 million pets and pet owners but now the penetration is still quite low last but least we're talking about the health ecosystem for instance as everybody knows about the personal clinic policy and the million healthcare policy around this particular area we do More innovations around the service provision and also the stratification of the patient or the customer clusters. And we've been promoting the products like Zhongmingbao and also some of the other products like the outpatient, the merchant insurance and the insurance, et cetera, which we have just to share the colors upon. Thank you for this question. And now, Wang Lin, you can answer the question relating to the consumer finance. All right, thank you very much for your question. Considering the pressure of the macro environment and the adjustment of this policies industry, and from last year onwards, we have been shrinking this total premium on this area of credit insurance. And I see that in terms of this particular underwriting balance and also the total underwriting scale, these two were reducing significantly. from the disclosed data. You can see that with such a large pressure from the outside, you know, in the first half of the year, we were profitable on the ecosystem of consumer finance. So all the time, since always, we were quite precautious in thinking about our mindsets and combined with the risk control model that is empowered by the technology. This year we focused more on the handwriting renewal, combined with different platforms with the users. So you can see that the combined ratio of the first half of this year was increasing with the same period last year, but if you're comparing with the second half of last year, it was improving. So overall speaking, in the second quarter of the first half, also we had a very good quarter-by-quarter improvement. and also at the same time, we are optimizing all the parameters of the users. So in the second half of year, we're going to maintain a as-prudent attitude and also continue to provide the service to those absent customers that we have already covered and also maintain a very stringent risk control standard. All right, pretty much for my answer. Thank you. Thank you for the question. And now, let's have Michael Lee from Bank America Securities. Sorry, the voice is quite low. So in the first half of the year, we had a very good trend. So now we're having the cycle of interest lowering. So in this bigger cycle, one of the strategies for us to cope with this cycle was expectation. Second question is about the technology segment. We had a very good growth. So can you talk to us about this more? What is the plan in the future? All right. Thank you very much, Michael, for this question. This is a very good question. So let me repeat your question. So you asked that for the interest lowering, what's the impact to join the bank and what has been impacted for, right? So to be honest with you, this is pretty much impactful. And also for different business segments, we have a different impact. And also the overall kind of impact will be different. But for Zipan, this is pretty much active. So first of all, in terms of the net spread, which is going to be further squeezed. So comparing with the traditional industry at the current stage, I have a low percentage of CAFA against the deposit. So overall speaking, you know, we are going to have a much quicker capital cost reduction than the traditional banks. And also on the asset side, we're going to see more demand of getting loans. And also we're going to bring in more revenue. On the bank side, the bond out can increase also its price and increase in the investment yield. Also for the non-interest income, the shares and equity that we have invested are going to be positively impacted because of a more active capital market. So these are all something that we have observed. Second question is about the technology export. And now let's give the floor to Wang Ming to answer this question. All right, thank you very much, Michael, for your question. So first of all, the technology segment increased rapidly in the first half of the year. And also we had also more robust growth for the domestic technology export business, benefiting by the more policies to benefiting the digital China and also establishment of digitized economy. We have a very big confidence over the long-term growth of the technology export business So I really understand that you pay a little attention to technology segment, not only growth, but also you're expecting to see the improvement of profitability. The first half of the year, be it the technology export in China and also overseas, we've been shortening the losses a lot. So on one hand, we are increasing the percentage contributed by the high close margin products. And also, as for AIGC and other new technologies, we are actively applying them, helping us to actually increase the efficiency in terms of product R&D. And of course, that we are enhancing our internal management capability and efficiency and lower down the cost as a result. So while we are increasing our revenue scale, it is helping us to manage our cost very successfully and thus improving our profitability further. Thank you. Thank you very much. Now let's have the final question. Thank you very much. I am asked from I have two questions. The first one is that we can see that the total premium growth was slowed down the first half of the year. What were the reasons? What about the guidance? and also what is the placement strategy on the channels. And second one is about the US bond and we remember that we're going to do the US debt and how are you going to pay back that debt. All right, thank you very much for the question. So you can see that the slowdown of the growth of the total premium in the first half of the year. And the first reason was that the consumer finance business was shrinking actively based on the macro and external environment. And also we had a strategic adjustment of the user acquisition on the health insurance area. We wanted to get acquired the new customers in a more economical way. So based on these two reasons, the overall gross return premium decreased or growth rate decreased. But looking ahead to the second half and also the future, we're going to still be user-centric and focus on the elevation of the user experience. Hopefully that we're going to have a sustainable development. And Gautam, please answer the question about the financing and also the dollar bond. All right, thank you for this question. In 2020, we have issued one billion US dollars of high-level debt and bond in overseas, and in 2022, we repurchased 49.9 million U.S. dollars of the bond in total. And also in terms of the duration, we have 519 million U.S. dollars bonds that could be due next year, July, and 360 million dollar bond will be due by March of 2026. At the current stage, our cash flow is quite stable, solvency ratio quite sufficient, and we are actively preparing for the payback. And of course, that considering the external environment, we are also going to also think about the possibility of doing financing, refinancing. All right, thank you very much. We have to end this conference call. Thank you very much for your participation and support to join online. Thank you. And you may disconnect now.