CNFinance Holdings Ltd (CNF) 2024 Q2 法說會逐字稿

Hello, and welcome to the CNFinance Holdings Limited first-half of 2024 financial results conference call.

您好，歡迎參加中金金融控股有限公司2024年上半年財務業績電話會議。

(Operator Instructions) Please note, this event is being recorded.

（操作員說明）請注意，正在記錄此事件。

I would now like to turn the conference over to [Simon Tan], Manager of the Capital Markets Department.

我現在想把會議交給資本市場部經理[Simon Tan]。

Please go ahead.

請繼續。

Thank you, Joe. Good morning and evening, and welcome to the CNFinance first half of 2024 financial results conference call.

謝謝你，喬。大家早安、晚上好，歡迎參加財經財經2024年上半年財務業績電話會議。

In today's call, our Director and Vice President, Mr. Qian Jun, will walk us through the operating results followed by the financial results from our Acting CFO, Ms. Li.

在今天的電話會議中，我們的董事兼副總裁錢軍先生將向我們介紹經營業績，隨後代理財務長李女士將介紹財務業績。

After that, we will have a Q&A section.

之後，我們將有一個問答部分。

Before we started, I would like to remind you that this conference call contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the US Private Securities Litigation Reform Act of 1995.

在開始之前，我想提醒您，本次電話會議包含經修訂的 1934 年證券交易法第 21E 條含義以及 1995 年美國私人證券訴訟改革法案所定義的前瞻性陳述。

These forward-looking statements can be identified by terminology such as will, expects, anticipates, future, intends, plans, believes, estimates, target, going forward, outlook, and similar statements.

這些前瞻性陳述可以透過意願、期望、預期、未來、打算、計劃、相信、估計、目標、前進、展望和類似陳述等術語來識別。

Such statements are based upon management's current expectations and current market and operating conditions and relate to the 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.

此類聲明是基於管理層當前的預期以及當前的市場和經營狀況，並涉及涉及已知或未知風險、不確定性和其他因素的事件，所有這些因素都難以預測，而且其中許多因素超出了公司的控制範圍，這可能導致公司的實際結果、績效或成就與前瞻性陳述中的結果有重大差異。

Further information regarding these and other risks, uncertainties or factors is included in the company's filings with the US Securities and Exchange Commission.

有關這些和其他風險、不確定性或因素的更多資​​訊包含在該公司向美國證券交易委員會提交的文件中。

The company does not take any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.

除法律要求外，本公司不承擔因新資訊、未來事件或其他原因而更新任何前瞻性聲明的義務。

Now, please welcome Mr. Qian Jun.

現在有請錢軍先生蒞臨。

(interpreted) Good day, everyone.

（譯）大家好。

Thank you for joining us today.

感謝您今天加入我們。

In the first half of 2024, our focus was squarely on navigating the microeconomic uncertainties by reinforcing our business fundamentals and ensuring the quality of our assets.

2024 年上半年，我們的重點是透過鞏固業務基礎和確保資產品質來應對微觀經濟的不確定性。

During this period, we originated loans of RMB6.9 billion.

在此期間，我們發放了貸款人民幣69億元。

As of June 30, 2024, our outstanding loan principal was approximately RMB16 billion, reflecting a year-over-year growth of about 10%.

截至2024年6月30日，我們的貸款本金餘額約為人民幣160億元，年增約10%。

To manage potential risks, we continue refining our credit approval strategy and strengthened our efforts in collecting and disposing of non-performing loans.

針對潛在風險，我們持續完善授信核准策略，增加不良貸款清收處置力道。

As a result, we maintain our non-performing loans ratio at approximately 1.2% as of June 30, 2024, consistent with the level at the end of last year.

因此，截至2024年6月30日，我們的不良貸款率維持在約1.2%，與去年年底的水準一致。

We recorded an interest income of approximately RMB930 million, up 5% compared to the same period last year.

實現利息收入約人民幣9.3億元，較去年成長5%。

However, while we benefit from a continued decline in interest rate of our trust financing, the increase in average daily loan principal under the trust model leads to a slight year-over-year rise in interest expense.

然而，在受益於信託融資利率持續下降的同時，信託模式下日均貸款本金的增加導致利息支出較去年同期小幅上升。

Since the start of the year, we have enhanced our collaboration with third-party asset management institutions, particularly in area of overdue loan collections.

今年以來，我們加強了與第三方資產管理機構的合作，特別是在逾期貸款催收方面。

These strategic moves significantly boosted our recovery amounts, though it also lead to a corresponding increase in operating expense due to service fees paid to the third-party institutions.

這些策略措施顯著提高了我們的回收金額，但由於向第三方機構支付的服務費，也導致營運費用相應增加。

Despite these additional costs, our net income from operating activities for the first half of 2024 was approximately RMB220 million, remaining largely flat compared to the same period last year.

儘管有這些額外成本，2024年上半年我們的營運活動淨利約為人民幣2.2億元，與去年同期基本持平。

We have maintained a prudent approach in provision for impairments.

我們在提列減損準備方面保持審慎態度。

With the increase in our outstanding loan principal, the provision for credit losses increased to RMB172 million.

隨著未償還貸款本金的增加，信用損失準備增加至人民幣1.72億元。

Consequently, our net profit for the period decreased to RMB48 million.

因此，我們的期內淨利減少至人民幣4,800萬元。

Our key area of focus for the half-year period includes: first, we continue to drive down our funding cost.

我們半年的重點工作包括：一是持續降低融資成本。

With market interest rates turning downward, we actively engage in negotiations with our funding partners to secure more favorable financing terms.

在市場利率下行的情況下，我們積極與融資夥伴進行談判，以獲得更優惠的融資條件。

Leveraging our long-term relationships, we achieved a reduction in our average financing rate by approximately 4% year-over-year.

憑藉我們的長期關係，我們的平均融資率比去年同期下降了約4%。

The reduction allowed us to pass on benefits to our customers with end user interest rate decreasing by about 1% point.

此次降息使我們能夠將利益轉嫁給客戶，最終用戶利率下降約 1%。

Second, we strengthened our support for sales partners.

二是加強對銷售夥伴的支持。

This quarter, we observed a further easing of liquidity pressure on our sales partners, with more of them resuming their repurchase obligation to protect the loan they recommended.

本季度，我們觀察到我們的銷售合作夥伴的流動性壓力進一步緩解，其中更多的銷售合作夥伴恢復了回購義務以保護他們推薦的貸款。

This share benefit, share risk model has been instrumental in reducing our risk exposure.

這種利益共享、風險共享的模式有助於降低我們的風險敞口。

Third, we maintain our focus on asset quality.

三是繼續專注於資產品質。

We concentrate our business efforts on the core area of first tier and new first tier cities, with over 90% of our loan is in the period being originated in these regions.

我們的業務重點集中在一線及新一線城市的核心區域，90%以上的貸款來自該地區。

In addition, we deepened our cooperation with third-party asset management companies, enhancing our capability in collecting delinquent loans.

此外，深化與第三方資產管理公司的合作，提升拖欠貸款催收能力。

Through these efforts, we successfully maintained our NPL ratio at 1.2% as of Jan 30, 2024, while achieving a recovery rate of 110% during the period.

透過這些努力，截至2024年1月30日，我們成功將不良貸款率維持在1.2%，期內回收率達110%。

As we look ahead, we recognize the ongoing uncertainty in the microeconomic environment and the adjustment in the real estate market.

展望未來，我們認識到微觀經濟環境和房地產市場調整仍存在不確定性。

We are committed to adjust the quality pressure of our existing loan and navigating the uncertainty surrounding new loans.

我們致力於調整現有貸款的品質壓力，並應對新貸款的不確定性。

To that end, we will continue to adjust our strategy focusing on ensuring asset quality and enhancing operational efficiency.

為此，我們將繼續調整策略，專注於確保資產品質和提高營運效率。

Our goal is to improve both quality and profitability of our business.

我們的目標是提高業務品質和獲利能力。

Our specific measure moving forward includes: enhancing our focus on asset quality, we will rigorously manage our credit approval standards for new loans; ensuring the quality of forwards and collaterals.

下一步我們的具體措施包括：更重視資產質量，嚴格新增貸款授信核准標準。確保遠期和抵押品的品質。

Additionally, we will continue to improve the efficiency of our delinquent loan recoveries, particularly through settlement recoveries, which offer the advantage of fast recovery and high recovery rate.

此外，我們將持續提高拖欠貸款的追收效率，特別是透過結算追收，具有回收速度快、回收率高的優勢。

We plan to deepen our cooperation with third-party asset management company to further leverage this advantage, improving both recovery speed and recovery rates.

我們計劃深化與第三方資產管理公司的合作，進一步發揮這一優勢，提高回收速度和回收率。

Strengthening our product innovation, we will maintain the high quality and fast advantage of our products, while expanding our product portfolio to adapt to various scenarios.

強化產品創新，維持產品優質、快速的優勢，同時擴大產品組合，適應各種場景。

To support these new business scenarios and enhancing overall efficiency, we will continue to optimize our sales system and adjust our credit approval policies.

為了支援這些新的業務場景並提高整體效率，我們將繼續優化銷售體系並調整信貸審批政策。

Incorporating additional dimensions into our approval models.

將額外的維度納入我們的審批模型中。

Further strengthening our compliance efforts, we are committed to continuously improving our risk control and compliance process through target actions, which will help us prevent the non-market risk cases.

進一步加強合規工作，我們致力於透過有針對性的行動，不斷完善風控和合規流程，防範非市場風險案件。

Now I will hand over the time to our CFO, Mr. Li Jing, and she will introduce the financial results for the first half of 2024 to you.

現在我將時間交給我們的CFO李靜先生，她將向大家介紹2024年上半年的財務表現。

Our total interest and fixed income increased by 4.7% to RMB926.5 million from RMB884.5 million.

我們的利息和固定收入總額從人民幣 884.5 百萬元增長 4.7% 至人民幣 926.5 百萬元。

Total interest and fees expenses increased to RMB401.7 million from RMB366.3 million.

利息及費用支出總額從 3.663 億元增加到 4.017 億元。

The increase in total interest and fees expenses was mainly due to the increase in average daily balance of interest-bearing borrowings.

利息及費用總額增加主要是因為帶息借款日均餘額增加所致。

Net interest and fee income was RMB524.8 million, representing an increase of 1.3% from RMB518.2 million.

利息及手續費淨收入為人民幣524.8百萬元，較人民幣518.2百萬元成長1.3%。

Net revenue under the commercial bank partnership model was RMB58.4 million as compared to RMB50.1 million in the same period of 2023.

商業銀行合夥模式的淨收入為人民幣5,840萬元，而2023年同期為人民幣5,010萬元。

In the first half of 2024, the majority of borrowers were introduced by sales partners and the commission paid to sales partner sales channels have decreased, which has ultimately led to an increase in the net revenue under the commercial bank partnership model.

2024年上半年，大部分借款人由銷售夥伴引入，支付給銷售夥伴銷售管道的佣金減少，最終導致商業銀行合夥人模式下的淨收入增加。

Collaboration cost for sales partners decreased by 3.9% to RMB159.2 million from RMB165.6 million.

銷售合作夥伴的協作成本從人民幣1.656億元下降3.9%至人民幣1.592億元。

Net interest and fee income after collaboration costs increased by 5.3% to RMB424 million from RMB402.7 million in the same period of 2023.

扣除合作成本後的淨利息和費用收入從2023年同期的人民幣4.027億元成長5.3%至人民幣4.24億元。

Provisions for credit losses increased to RMB170.8 million from RMB129.6 million in the same period in 2023.

信用損失準備金由2023年同期的人民幣1.296億元增加至人民幣1.708億元。

The increase was mainly due to the increase in outstanding loan principal.

增加的主要原因是未償還貸款本金增加。

Other expenses increased by 62.2% to RMB97 million from RMB59.8 million in the same period of 2023, primarily due to the increase in fees paid to third-party asset management companies to collect delinquent loans.

其他費用由2023年同期的人民幣5,980萬元增加62.2%至人民幣9,700萬元，主要是由於向第三方資產管理公司收取拖欠貸款的費用增加。

Net income was RMB48 million as compared to RMB93.1 million in the same period of 2023.

淨利為人民幣 4,800 萬元，而 2023 年同期為 9,310 萬元。

As of June 30, 2024, the company had cash and cash equivalents and restricted cash of RMB1.6 billion, including RMB1 billion from structured funds as of June 30, 2024, which could only be used to grant new loans and activities.

截至2024年6月30日，公司擁有現金和現金等價物以及限制性現金為人民幣16億元，其中截至2024年6月30日來自結構性基金的人民幣10億元，只能用於發放新貸款和活動。

The delinquency ratio for loans originated by the company increased from 15.5% as of December 31, 2023, to 16.4% (sic - see press release, 17.4%) as of June 30, 2024.

該公司所發放的貸款拖欠率從截至2023年12月31日的15.5%增加至截至2024年6月30日的16.4%（原文如此 - 參見新聞稿，17.4%）。

The NPL ratio for loans originated by the company was 1.2% as of June 30, 2024, compared to 1.1% as of December 31, 2023.

截至2024年6月30日，該公司發放的貸款不良率為1.2%，截至2023年12月31日為1.1%。

With that, we would like to start the Q&A session.

至此，我們開始問答環節。

Just one moment please.

請稍等一下。

Okay.

好的。

At this time, I understand that this will conclude the question-and-answer session.

此時，我明白問答環節到此結束。

I would like to turn the conference back over to Simon Tan for any closing remarks.

我想將會議轉回西蒙·譚（Simon Tan）發表閉幕詞。

That's all for today.

這就是今天的全部內容。

Thank you for joining us.

感謝您加入我們。

If you have any more questions, please feel free to reach us at ir@cashchina.cn. Thank you.

如果您還有其他疑問，請隨時與我們聯繫：ir@cashchina.cn。謝謝。

The conference has now concluded.

會議現已結束。

Thank you for attending today's presentation.

感謝您參加今天的演講。

You may now disconnect.

您現在可以斷開連線。

Portions of this transcript that are marked (interpreted) were spoken by an interpreter present on the live call.

此文字記錄中標記（翻譯）的部分是由現場通話中的口譯員說出的。

The interpreter was provided by the company sponsoring this event.

口譯員由贊助本次活動的公司提供。