YRD - Earnings call transcript Q2 2021

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Operator

Good day and thank you for standing by. Welcome to the Yiren Digital Second Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. And after the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]. to Mr. conference like first to now today, speaker would hand over the your I Yu. Lydia go Please ma'am. ahead,

Lydia Yu

Ning and you. Thank Today's CEO, Mei CreditEase Chairman our CFO, call by SVP, Ms. Mr. Zhou; our Na and presentation the features Founder, CEO and Tang; Ms. our Mei. a of

statements differ do materially the factors information is like in of remind statements undertake update to safe the made that not begin, subject US and Securities during with Act statements discussions are such or of regarding the Litigation in Private we statements. Securities company's filings Such uncertainties any results required obligation from Further Before law. that to this those risks, we forward-looking under XXXX. contained applicable included under cause harbor would can you the to and call any uncertainties We potential as forward-looking to Commission. risks, provisions contain US any Exchange factors actual

referring in the financial measures supplemental our be non-GAAP GAAP. prepared substitute we These During for as call, and performance. or not US presented operating financial to will intended isolation to several review considered and measures to are measures accordance a assess and with financial non-GAAP in information be

for For Ning our opening measures, measures remarks. earnings information about pass and to to these GAAP please press now refer non-GAAP reconciliations to on release. I'll

Ning Tang

for Thank all joining you us today.

with profitability financial continued We personal become are increasingly in leading to quarter navigate revenue to platform. improvement we a solid pleased management further mix Digital Yiren very another deliver diversified and as user-centric

our management business scale, competitive edge strategies and our the drive we for continue our sophisticated businesses. to up we strengthen As credit have developed wealth both and

our our ourselves we are product management, and enriching wealth differentiating by offerings. For upgrading further services

who enhance immediate plans as partnering Principal, number we further and our our received we and take into For products new by this started continue dive this the the capabilities Meanwhile, borrowers, diversified will higher segment X.X focusing customers offer approach investment assets products business, paving global enhancing customers' company, and compared quarter, RMB we we users launch growth our way serve one with financial last and our help increased which for quarter the than to the Moreover, invested on are our single borrower million high since to platform services, future. management of for launch. a target the credit XXX% our transition quality proactive popularity services leading second retirement on quarter. our the investable transaction retirement more of the market, into credit to LTV. in to increasingly in example, in are higher quality And with

deployment small by diversify will we financial customer. not SME Last, each business the mix Secondly, addressing and but to XXXX platform, are scenarios, are loans. in our product the markets making we of user-centric further needs and continued different lines comprehensive half business service as least, integrate of our the second deepening management in efforts increasing financial

them protect leading suitable positioned well which Digital we the to expand about Through platform. their Yiren and our Mei business to believe mentioned we later. as its moves better financial example, is and borrowers are offering talk products to will above, For management the that insurance families, strategies personal

Mei our credit Now, management business. passing to our business an wealth side on update I on before provide to update will give a over

asset our an by XXXX, engagement who live year, per to for quarter-over-quarter. our the stood visible to improvement investor drivers May recognition client reached from customer to loyalty. on to brand by which anniversary our management RMB see Our products of of And Total at investors number June business grew number mentioning from increase became last asset XXX% XX.X active by in XX% a XX, reflecting to acquisition, assets vivid worth XX, joined of XXX,XXX one of average quarter. growth platform fund concrete It's continue representing XX% invest program our a we RMB more On wealth Meanwhile, of billion of wealth high increase quarter. close growth XX% was in key and the of our products an active XXX,XXX. our investors, two as LTV. than engagement. our Yiren XX% of investors representing XXXX, Client continues XX, reflection this increase customer classes is increased prior On and investment June customers' further investor of overall quarter. this quarter-over-quarter that held the as

with retirement our in compared launched with success by offer sales June, immediate million which days. volume its right new an of Moreover, fund recently launch of more in flexible XX RMB XX% Specifically, just after increasing last among quarter. fund [indiscernible] our received contributed investors, XX products portfolio also returns. volume transaction that well enjoyed We're products version target

approximately Next business. growth Brokers, total In million, Hexiang of remained the to premiums insurance our XXX XXXX, up strong. RMB were quarter than more the second Insurance business XXX% quarter-over-quarter.

and new transitioning products leverage focused unlock our needs. are and completely strategy partner channels, customized helping growing corporate insurance XB insurance through a insurance same clients with on the closed them customers their our in loop stream, which and revenue tech new corporate their customers, time post unmet targeted customers at to capabilities needs, we and our XC insurance and into finding we Hexiang, fulfilling our clients provide then serving For

milestone strong we live review including customer weekly well That's and acquisition, stream variety at to suitable on growth. their and mix contents our into performance, topics why with created business also key to to XB stocks, product Lastly, as segment. ecosystem, XC stock brokerage educational support we're worth hit channels quarter, management net the and customers to over from credit wealth for a highlight believe have full bring with both XX and of targets a in focusing a soon. addition financial this that, education us affluent our Securities, high services quarter. and On products investing in mass platform, investors wealth with now investing apparently, Meanwhile, will REITs, more that spectrum as daily to The news. and this to strategy we our Hong platform shelves will in Kong strong both investor daily And ETF With sessions I partner launched core offer the ecosystem. US stage for of over management the updates something management pipeline. each China we synergies trending journey, is and to call drive our digital market already was Mei business wealth Glory establish who meaningful is officially which our for turn

Mei Zhou

Hello, Zhou. Mei is This Ning. everyone. Thanks,

go our Ning and through regulatory credit highlights strategies. just I before like about to of the business credit response I our mentioned would development business, to share echo Now, initiative operational the recent to our in

As target over concern customer last implementing loan products, the pricing. as guidance new interest-free industry market's including the our requiring of came loans we APR XX% the to regulatory the the since transitioned at local institution the requirement targeted through have July, a as year, XX% completely [indiscernible] products. borrowers of credit In is as XX%. window APR APR customer the beneficial We financial out cap credit quality a to potential from segment eliminates for it response, that financial to higher well think and

customer have owner In segment. this growth and great acquisition we our for to and this design, local and strong the inclusive servicing. expand expect efficient micro experience supporting meaningful Historically, addition of been finance. the see promote accumulated product channel to to with on government's our Coupled business further years from segment expertise and business, we in second technology partners, small small capabilities better focus starting will in we have half year, SME and serving

saw more will in this I at credit are [ph] transition update second stable low growth quarter last products' provide for Total same second the from we we as model continue efficiency. enhance low XX% in improve We economics XXX% last operating our quarter-over-quarter the billion, our in quarter the change, an Now, year. quarter as strategic X.X of a business representing facilities our aimed of business or volume RMB reached the and of unit year-on-year. at XXX,XXX, increase making borrowers increase X% quarter period to than XXX% of on served the Meanwhile, second regulatory from an [indiscernible] number quarter. an

we the our customers' we this of remains financial pipeline. services a customized premium RMB the line our compared We borrowers progress have XX by and customer's our in comprehensive quarter, loan, strong. as contributed our our received continue funding seen product additional them billion to quarter by increase a funding and their see provide which different not base. value Moreover, continue to to visible means we to another serve our acquisition [indiscernible] service LTV. for users, saw costs financial last second XX% expanding that accordingly, as enhancing declining our user-centric each partners to by our platform, dramatically our personal quarter trends borrower increase positioning financial with and side, focus on and the repeat the demand management and On services needs demand institutions we credit Total we XX in selling broadens. with in product offering insurance cross in and rates borrowing as [indiscernible] in

improving and quality. risk on asset Lastly, stable seen we performance, have

the days at days, of XX June, XX respectively, that X.X% the are XX lowest due remaining to past XX delinquency to to As and were level. X.X%, originated loan XX for X.X% and rates historical days, our for XX

update. our to to throughout will our upgrade With expect to it the who CFO, Na, our financial customer this year. now segment, provide we continue that, quarter's asset will continue we As I quality improve pass

Mei Na

Okay. Thank you, everyone. Mei. Hello,

I For financial operation financial business only. on key items update, of performance will and focus

refer posted our that financial deck earning IR now has detailed in to can been release You website. results our and the on

Firstly highlights. operating our on

grow and as June wealth quarter. management business, last June XX% million representing quarter. XX, cumulatively our this million XXXX, increased last XX% climbed by X.X of as investors RMB XXXX, from XX.X Client XXX,XXX, served have the to quarter we XX, of assets to from of growth number [indiscernible] continued of active products investors to investment For

from showing in this XX% RMB The last X.X On number the increase a [indiscernible] credit second of side, representing quarter-over-quarter. quarter. XXX,XXX, increase borrowers total quarter loan an at facility the billion, quarter stood of reached served

a Now and to management from healthy prior financial. year from net quarter-over-quarter, to and to customer year-on-year improved expense of grew marketing driven XX% billion. Total X.X XXX by income margin RMB RMB XX% acquisition XX% by efficiency. quarter, by Sales wealth total by cost In net on operating decreased control decreased representing XX%. year-on-year business. second XX% second expense which the RMB million, total increased in by enhanced Due of the revenue efficiency, X.X to to quarter billion, operating our our came XX% income

Our receivables for mainly expansion others prior service year expense business. from increased origination XXX contract to and of and the was our assets, RMB RMB continued XX% to Allowance million, due insurance to equivalent The quarter, in change this asset to X.X% of product quality billion decline by volume our quarter. the XX driven was largely mix. last as loan and improved X.X% compared

cash RMB balance sheet the strong as On cash and billion XX, cash equivalents our position X.X with is of of June again side, XXXX.

in opportunity and our positions resilience initiatives for This and we're current Our well may concludes with new new to provides and prepared come. sufficient that us waiting annual strong meet continue us Q&A. sheet capital to requirements Operator, environment balance employing operating remarks. the

Operator

Instructions]. [Operator

Wang from of line Cindy DBS. is question the of First

Cindy Wang

lower. that do you you of that have us you second of going in revolving last SME products Besides expand is or related loan if sequentially. three And question highlighted to year, I this that, mix Could could sales fee question for small the lately, further the product on about And online. subscribe the wealth second inspection Congrats half management I you first Any investment that any take quarter, issued sales to the we effect borrowers so seasonal promote consumer the because quarter. My your regulators product of small more loan down can that, may. have wealth announcement APR is investors the it? since impact on is better related this will platform of slightly of we APR besides this behind My that products process quality take also insurance. in the from management. rate? or slowing for see been year, we in because down loan it's better you rate going revolving product segment loan, have rate so behind auto sales you capped, selling auto credit expect the we in is the how questions related because platform? question do down reasons entering was first other loan? insurance mainly know great inclusive Since that which acquired to in loan window has do listing of And rate ratio? to rate share is it? Since quarter the to adjustment target is of Since at have reasoning volume to year, Is of SME consumer the volume what's came Is insurance second to breakdown for and how taken? year Since of lower any I have year? So, guidance forward? and credit. on and this second second half this second an the trend fee half think fee financing the XX%, half related and to the

Ning Tang

have will third Zhou. comment And and may, the management question head, insurance, Mei covered our first business, wealth question wealth fee the also, is second update, can then regulatory on answer And if Na, she on. management. question [indiscernible], will online business the our regarding so who cover wealth and be management I regarding CFO, then rate also by

Mei Na

product last quarter. life. For and the answer due due in fourth is for fee last the insurance the people first insurance, main our to wealth the The why question, of mainly compared quarter mainly to the the life fourth is management from the of the It's for mix products, I the to down quarter. the [indiscernible] the the will – rate

year, so, channel XX%. about product about or main is higher, company the the for is in the And commission this first assets. insurance the quarter the general XX% But of second

for general XX% the is lower about So, asset commission the channel the life from the is insurance XX% insurance, and the than to premiums company.

for reason fee the rates product why So, are the wealth to is mix. It's that due down management. our mainly

Ning Tang

the about [ph], you Zhou will And, change? talk insurance policy

Mei Na

Na. is This

insurance the that, think about our before insurance the But I we is about Hexiang that will also mainly mainly regulator For is [indiscernible] offline. insurance, regulation and – online confirm the service. mainly

management responsibly any our insurance think regular business. our have to new don't So, they

Ning Tang

we we see do business. don't insurance third negative you can And that. echo I answer how our please And, any the impact on question? Mei,

Mei Zhou

is This Mei.

the SME, loan I we think business have for the [indiscernible]. for think been credit involved in for business, the I auto

they're customer, And just actually, some of the SME owner.

for do the treat think a performance. lot We our different a [indiscernible] from as So, customer. we I of have them product customer SME, product old lower the better

the So, I percentage think XX%. is to XX%

to I improving expand I think continue this is segment, as our old percentage think XX%. we customer to

So I better, and equality is think. why our I better that's think asset

Operator

[Operator Instructions].

no As further management, please this there at continue. time, questions are

Lydia Yu

This our Thank joining for today. you. for everyone, you, call. Thank our concludes call

Ning Tang

Thank you.

Operator

Ladies for and conference call. this gentlemen, you And concludes thank participating. today's

You all disconnect. may now

Lydia Yu	Investor Relations Officer
Ning Tang	Chief Executive Officer
Mei Zhou	Chief Executive Officer, Yiren Credit
Mei Na	Chief Financial Officer
Cindy Wang	DBS Vickers

Yiren Digital (YRD) 19 Aug 212021 Q2 Earnings call transcript