SHANGHAI--(BUSINESS WIRE)-- Lufax Holding Ltd (“Lufax” or the “Company”) (NYSE: LU), a leading technology-empowered personal financial services platform in China, today announced its unaudited financial results for the second quarter ended June 30, 2021.
Second Quarter 2021 Financial Highlights
(In millions except percentages, unaudited) |
Three Months Ended June 30, |
|
||||||||
|
2020 |
2021 |
YoY |
|||||||
|
RMB |
RMB |
USD |
|
||||||
Total income |
12,637 |
|
14,828 |
|
2,297 |
|
17.3 |
% |
||
Income excluding investment income |
12,417 |
|
14,792 |
|
2,291 |
|
19.1 |
% |
||
Total expenses |
(8,291 |
) |
(8,477 |
) |
(1,313 |
) |
2.2 |
% |
||
Total expenses excluding credit impairment losses, financial costs and other losses |
(7,229 |
) |
(7,107 |
) |
(1,101 |
) |
(1.7 |
%) |
||
Credit impairment losses |
(597 |
) |
(1,394 |
) |
(216 |
) |
133.5 |
% |
||
Financial costs and other losses, net |
(466 |
) |
25 |
|
4 |
|
(105.4 |
%) |
||
Net profit |
3,086 |
|
4,729 |
|
732 |
|
53.2 |
% |
||
Net margin |
24.4 |
% |
31.9 |
% |
31.9 |
% |
NA |
Second Quarter 2021 Operational Highlights
Retail credit facilitation business:
Wealth management business:
Mr. Ji Guangheng, Chairman of Lufax, commented, “Although market sentiment towards Chinese ADRs has fluctuated substantially due to recent changes in macro policies and market conditions, Lufax has greatly improved its operating performance while maintaining strong regulatory compliance and corporate governance. In the first half of 2021, our total income grew by 17.1% and our net profit grew by 33.4%. Since Lufax’s inception, we have always been in close and constant dialogs with the regulatory authorities to fully grasp the latest regulatory trends, intentions, and requirements. By establishing and maintaining constructive relationships with a multitude of regulatory authorities in all relevant aspects, we have been able to synchronize our own operations with policy changes. Based on our own analysis of regulatory intentions and industry competition, we have decided to gradually shift our business focus from volume growth to quality enhancement and uphold three principles: to keep our operations fully compliant with regulations, to provide increasing value to small and micro business owners as well as the middle class, and to empower our business development with technology advancement. While we are cognizant of the challenges ahead, we are also confident in our own ability to deftly navigate through changing market dynamics and lay a unique path to long-term and sustainable success.”
Mr. Gregory Gibb, Co-Chief Executive Officer of Lufax, commented, “On the back of our solid financial performance, abundant cash reserves, and strong net cash flow, we are able to meet any new capital requirements that may come from regulatory changes, reward our shareholders by adding another US$700 million to our existing share buyback program, and continue to allocate more capital towards enhancing our unique business model. What sets Lufax apart from our peers is our unparalleled O2O direct sales force, our distinctive way of deploying business licenses, and our full range of financial services beyond lending. We are confident that our combination of capital strength, differentiated business model, in-depth financial credit experience, and commitment to regulatory compliance will enable us to remain resilient in a rapidly changing operating environment.”
Mr. James Zheng, Chief Financial Officer of Lufax, commented, “Our second quarter 2021 results are characterized by strong business growth, continued operations improvement, and expanded profit margins. Our total income grew by 17.3% year over year to RMB14.8 billion, and our net profit increased by 53.2% year over year to RMB4.7 billion. We maintained our momentum by continuously optimizing our unit economics, growing our loan volume, improving our business mix, executing a more sustainable risk-sharing model, enhancing our asset quality, and substantially completing the run-off of legacy P2P products. While we ramped up our total income excluding investment income by 19.1% year over year, we also managed to reduce our total expenses excluding credit impairment losses, financial costs, and other losses by 1.7% year over year, showcasing our efficiency in most areas. As of June 30, 2021, our total equity had reached RMB91.1 billion, and we had approximately RMB42 billion liquid assets9 maturing in 90 days or less. Looking ahead, we will continue to balance prudent cost controls with healthy business expansion to deliver lasting shareholder value.”
Second Quarter 2021 Financial Results
TOTAL INCOME
Total income increased by 17.3% to RMB14,828 million (US$2,297 million) in the second quarter of 2021 from RMB12,637 million in the same period of 2020. The Company’s revenue mix changed with the evolution of its business model as it gradually bore more credit risk and increased funding from consolidated trust plans that provide lower funding costs.
|
Three Months Ended June 30, |
|
|||||||||||
(In millions except percentages, unaudited) |
2020 |
2021 |
|
YoY |
|||||||||
|
RMB |
% of income |
RMB |
|
% of income |
|
|||||||
Technology platform-based income |
10,374 |
|
82.1 |
% |
9,601 |
64.7 |
% |
(7.5 |
%) |
||||
Retail credit facilitation service fees |
10,084 |
|
79.8 |
% |
9,194 |
62.0 |
% |
(8.8 |
%) |
||||
Wealth management transaction and service fees |
291 |
|
2.3 |
% |
407 |
2.7 |
% |
39.9 |
% |
||||
Net interest income |
1,624 |
|
12.9 |
% |
3,227 |
21.8 |
% |
98.7 |
% |
||||
Guarantee income |
92 |
|
0.7 |
% |
891 |
6.0 |
% |
868.5 |
% |
||||
Other income |
351 |
|
2.8 |
% |
1,071 |
7.2 |
% |
205.1 |
% |
||||
Investment income |
220 |
|
1.7 |
% |
37 |
0.2 |
% |
(83.2 |
%) |
||||
Share of net profits of investments accounted for |
(24 |
) |
(0.2 |
%) |
2 |
0.0 |
% |
108.3 |
% |
||||
Total income |
12,637 |
|
100 |
% |
14,828 |
100 |
% |
17.3 |
% |
||||
TOTAL EXPENSES
Total expenses increased by 2.2% to RMB8,477 million (US$1,313 million) in the second quarter of 2021 from RMB8,291 million in the same period of 2020. Total expenses excluding credit impairment losses, financial costs and other losses decreased by 1.7% to RMB7,107 million (US$1,101 million) in the second quarter of 2021 from RMB7,229 million in the same period of 2020 due to cost reductions in multiple areas.
NET PROFIT
Net profit increased by 53.2% to RMB4,729 million (US$732 million) in the second quarter of 2021 from RMB3,086 million in the same period of 2020, driven by the aforementioned factors as well as a reduction in the effective tax rate to 26% in the second quarter of 2021 from 29% in the same period of 2020.
EARNINGS PER ADS
Basic and diluted earnings per American Depositary Share (“ADS”) were RMB2.00 (US$0.31) and RMB1.86 (US$0.29), respectively, in the second quarter of 2021.
BALANCE SHEET
The Company had RMB29,022 million (US$4,495 million) in cash at bank as of June 30, 2021, as compared to RMB24,159 million as of December 31, 2020.
Recent Developments
US$300M Share Repurchase Program and US$5M Senior Management Share Purchase Plan
On May 24, 2021, the Company’s board of directors authorized a share repurchase program (the “US$300M Share Repurchase Program”), under which the Company would repurchase up to an aggregate of US$300 million worth of its ADSs over the following six months. On the same date, the Company’s board of directors approved a senior management share purchase plan (the “US$5M Senior Management Share Purchase Plan”), under which certain members of the Company’s senior management would purchase up to an aggregate of US$5 million worth of the Company’s ADSs over the following six months, pursuant and subject to applicable laws and the Company’s securities trading policy.
As of June 30, 2021, the Company had repurchased approximately 23 million ADSs for approximately US$281 million under the US$300M Share Repurchase Program and the senior management of the Company had purchased approximately 0.4 million ADSs for approximately US$5 million under the US$5M Senior Management Share Purchase Plan.
US$700M Share Repurchase Program
The Company today announced that its board of directors has authorized a new share repurchase program (the “US$700M Share Repurchase Program”) under which the Company may repurchase up to an aggregate of US$700 million of its ADSs during the 12-month period beginning at the close of business on the second trading day after the date of this press release. The Company’s proposed repurchases under the US$700M Share Repurchase Program may be made from time to time in the open market at prevailing market prices, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations.
Business Outlook
For the second half of 2021, the Company expects its new loans facilitated to grow by 16% to 21% year over year to the range of RMB324 billion to RMB340 billion, and client assets to grow by 5% to 8% year over year to the range of RMB450 billion to RMB460 billion. At the same time, as the Company strives to maintain its growth momentum and improve its operating efficiency, it expects its total income to grow by 18% to 19% year over year to the range of RMB31.0 billion to RMB31.3 billion, and net profit to grow by 32% to 36% year over year to the range of RMB6.6 billion to RMB6.8 billion.
For the full year of 2021, the Company expects its new loans facilitated to grow by 15% to 18% year over year to the range of RMB649 billion to RMB665 billion, client assets to grow by 5% to 8% year over year to the range of RMB450 billion to RMB460 billion, total income to grow by 17% to 18% year over year to the range of RMB61.1 billion to RMB61.4 billion, and net profit to grow by 33% to 34% year over year to the range of RMB16.3 billion to RMB16.5 billion.
These forecasts reflect the Company’s current and preliminary views on the market and operational conditions, which are subject to change.
Conference Call Information
The Company’s management will hold an earnings conference call at 9:00 P.M. U.S. Eastern Time on Monday, August 9, 2021 (9:00 A.M. Beijing Time on Tuesday, August 10, 2021) to discuss the financial results. For participants who wish to join the call, please complete online registration using the link provided below in advance of the conference call. Upon registering, each participant will receive a set of participant dial-in numbers, the Direct Event passcode, and a unique access PIN, which can be used to join the conference call.
Registration Link: https://dpregister.com/sreg/10159278/ec0129df24
A replay of the conference call will be accessible through August 16, 2021 (dial-in numbers: +1 (877) 344-7529 or +1 (412) 317-0088; replay access code: 10159278). A live and archived webcast of the conference call will also be available at the Company’s investor relations website at https://ir.lufaxholding.com.
About Lufax
Lufax Holding Ltd is a leading technology-empowered personal financial services platform in China. Lufax Holding Ltd primarily utilizes its customer-centric product offerings and offline-to-online channels to provide retail credit facilitation services to small business owners and salaried workers in China as well as tailor-made wealth management solutions to China’s rapidly growing middle class. The Company has implemented a unique, capital-light, hub-and-spoke business model combining purpose-built technology applications, extensive data, and financial services expertise to effectively facilitate the right products to the right customers.
Exchange Rate Information
This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB6.4566 to US$1.00, the rate in effect as of June 30, 2021, as certified for customs purposes by the Federal Reserve Bank of New York.
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Statements that are not historical facts, including statements about Lufax’s beliefs and expectations, are forward-looking statements. Lufax has based these forward-looking statements largely on its current expectations and projections about future events and financial trends, which 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. These forward-looking statements include, but are not limited to, statements about Lufax's goals and strategies; Lufax's future business development, financial condition and results of operations; expected changes in Lufax's income, expenses or expenditures; expected growth of the retail credit facility and wealth management markets; Lufax's expectations regarding demand for, and market acceptance of, its services; Lufax's expectations regarding its relationship with borrowers, platform investors, funding sources, product providers and other business partners; general economic and business conditions; and government policies and regulations relating to the industry Lufax operates in. Forward-looking statements involve inherent risks and uncertainties. Further information regarding these and other risks is included in Lufax’s filings with the U.S. Securities and Exchange Commission. All information provided in this press release is as of the date of this press release, and Lufax does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
LUFAX HOLDING LTD |
|||||||||||||||||
UNAUDITED INTERIM CONDENSED CONSOLIDATED INCOME STATEMENTS |
|||||||||||||||||
(All amounts in thousands, except share data, or otherwise noted) |
|||||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||||
|
2020 |
|
|
2021 |
|
2020 |
|
|
2021 |
||||||||
|
RMB |
|
RMB |
|
USD |
|
RMB |
|
RMB |
|
USD |
||||||
Technology platform-based income |
10,374,149 |
|
|
9,601,195 |
|
|
1,487,036 |
|
|
21,453,124 |
|
|
19,891,314 |
|
|
3,080,772 |
|
Retail credit facilitation service fees |
10,083,638 |
|
|
9,193,711 |
|
|
1,423,925 |
|
|
20,753,875 |
|
|
18,858,856 |
|
|
2,920,865 |
|
Wealth management transaction and service |
290,511 |
|
|
407,484 |
|
|
63,111 |
|
|
699,249 |
|
|
1,032,458 |
|
|
159,907 |
|
Net interest income |
1,623,605 |
|
|
3,226,887 |
|
|
499,781 |
|
|
2,998,206 |
|
|
6,137,811 |
|
|
950,626 |
|
Guarantee income |
91,604 |
|
|
890,589 |
|
|
137,935 |
|
|
170,466 |
|
|
1,441,964 |
|
|
223,332 |
|
Other income |
351,176 |
|
|
1,070,812 |
|
|
165,848 |
|
|
655,608 |
|
|
2,109,368 |
|
|
326,700 |
|
Investment income |
220,359 |
|
|
36,756 |
|
|
5,693 |
|
|
446,771 |
|
|
526,462 |
|
|
81,539 |
|
Share of net profits of investments accounted for |
(23,601 |
) |
|
2,037 |
|
|
315 |
|
|
(40,647 |
) |
|
(27,846 |
) |
|
(4,313 |
) |
Total income |
12,637,292 |
|
|
14,828,276 |
|
|
2,296,608 |
|
|
25,683,528 |
|
|
30,079,073 |
|
|
4,658,656 |
|
Sales and marketing expenses |
(4,606,357 |
) |
|
(4,315,895 |
) |
|
(668,447 |
) |
|
(8,620,294 |
) |
|
(8,549,164 |
) |
|
(1,324,097 |
) |
General and administrative expenses |
(659,359 |
) |
|
(797,573 |
) |
|
(123,528 |
) |
|
(1,347,713 |
) |
|
(1,651,278 |
) |
|
(255,750 |
) |
Operation and servicing expenses |
(1,526,911 |
) |
|
(1,476,499 |
) |
|
(228,681 |
) |
|
(2,818,606 |
) |
|
(2,997,686 |
) |
|
(464,282 |
) |
Technology and analytics expenses |
(435,909 |
) |
|
(516,828 |
) |
|
(80,046 |
) |
|
(848,677 |
) |
|
(963,421 |
) |
|
(149,215 |
) |
Credit impairment losses |
(596,659 |
) |
|
(1,393,534 |
) |
|
(215,831 |
) |
|
(1,098,804 |
) |
|
(2,446,784 |
) |
|
(378,959 |
) |
Asset impairment losses |
- |
|
|
(2,049 |
) |
|
(317 |
) |
|
- |
|
|
(2,049 |
) |
|
(317 |
) |
Finance costs |
(441,156 |
) |
|
(275,974 |
) |
|
(42,743 |
) |
|
(887,347 |
) |
|
(560,066 |
) |
|
(86,743 |
) |
Other gains/(losses) - net |
(25,029 |
) |
|
301,417 |
|
|
46,684 |
|
|
45,679 |
|
|
163,451 |
|
|
25,314 |
|
Total expenses |
(8,291,380 |
) |
|
(8,476,935 |
) |
|
(1,312,909 |
) |
|
(15,575,762 |
) |
|
(17,006,997 |
) |
|
(2,634,049 |
) |
Profit before income tax expenses |
4,345,912 |
|
|
6,351,341 |
|
|
983,697 |
|
|
10,107,766 |
|
|
13,072,076 |
|
|
2,024,607 |
|
Income tax expenses |
(1,259,713 |
) |
|
(1,622,650 |
) |
|
(251,316 |
) |
|
(2,836,207 |
) |
|
(3,374,756 |
) |
|
(522,684 |
) |
Net profit for the period |
3,086,199 |
|
|
4,728,691 |
|
|
732,381 |
|
|
7,271,559 |
|
|
9,697,320 |
|
|
1,501,923 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net profit/(loss) attributable to: |
|
|
|
|
|
|
|
|
|
|
|
||||||
Owners of the Group |
3,094,158 |
|
|
4,773,635 |
|
|
739,342 |
|
|
7,283,502 |
|
|
9,768,993 |
|
|
1,513,024 |
|
Non-controlling interests |
(7,959 |
) |
|
(44,944 |
) |
|
(6,961 |
) |
|
(11,943 |
) |
|
(71,673 |
) |
|
(11,101 |
) |
Net profit for the period |
3,086,199 |
|
|
4,728,691 |
|
|
732,381 |
|
|
7,271,559 |
|
|
9,697,320 |
|
|
1,501,923 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Earnings per share |
|
|
|
|
|
|
|
|
|
|
|
||||||
-Basic earnings per share |
2.85 |
|
|
4.00 |
|
|
0.62 |
|
|
6.70 |
|
|
8.17 |
|
|
1.27 |
|
-Diluted earnings per share |
2.85 |
|
|
3.72 |
|
|
0.58 |
|
|
6.70 |
|
|
7.59 |
|
|
1.18 |
|
-Basic earnings per ADS |
|
|
2.00 |
|
|
0.31 |
|
|
|
|
4.09 |
|
|
0.63 |
|
||
-Diluted earnings per ADS |
|
|
1.86 |
|
|
0.29 |
|
|
|
|
3.80 |
|
|
0.59 |
|
LUFAX HOLDING LTD |
||||||||
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
(All amounts in thousands, except share data, or otherwise noted) |
||||||||
|
As of December 31, |
|
As of June 30, |
|||||
|
2020 |
|
2021 |
|||||
|
RMB |
|
RMB |
|
USD |
|||
Assets |
|
|
|
|
|
|||
Cash at bank |
24,158,568 |
|
|
29,021,785 |
|
|
4,494,902 |
|
Restricted cash |
23,029,588 |
|
|
24,803,133 |
|
|
3,841,516 |
|
Financial assets at fair value through profit or loss |
34,423,897 |
|
|
31,801,649 |
|
|
4,925,448 |
|
Financial assets at amortized cost |
6,563,969 |
|
|
10,216,273 |
|
|
1,582,299 |
|
Financial assets purchased under reverse repurchase agreements |
700,007 |
|
|
4,264,925 |
|
|
660,553 |
|
Accounts and other receivables and contract assets |
23,325,978 |
|
|
22,552,057 |
|
|
3,492,869 |
|
Loans to customers |
119,825,814 |
|
|
170,097,360 |
|
|
26,344,726 |
|
Deferred tax assets |
3,358,664 |
|
|
2,784,029 |
|
|
431,191 |
|
Property and equipment |
424,043 |
|
|
380,868 |
|
|
58,989 |
|
Investments accounted for using the equity method |
489,931 |
|
|
462,794 |
|
|
71,678 |
|
Intangible assets |
1,882,462 |
|
|
1,871,801 |
|
|
289,905 |
|
Right-of-use assets |
973,547 |
|
|
827,183 |
|
|
128,114 |
|
Goodwill |
9,046,830 |
|
|
9,046,830 |
|
|
1,401,176 |
|
Other assets |
686,949 |
|
|
813,070 |
|
|
125,930 |
|
Total assets |
248,890,247 |
|
|
308,943,757 |
|
|
47,849,296 |
|
Liabilities |
|
|
|
|
|
|||
Payable to platform users |
9,114,906 |
|
|
4,580,090 |
|
|
709,366 |
|
Borrowings |
10,315,445 |
|
|
19,135,343 |
|
|
2,963,687 |
|
Current income tax liabilities |
2,610,610 |
|
|
2,167,871 |
|
|
335,760 |
|
Accounts and other payables and contract liabilities |
5,483,757 |
|
|
5,206,266 |
|
|
806,348 |
|
Payable to investors of consolidated structured entities |
110,367,718 |
|
|
159,170,700 |
|
|
24,652,402 |
|
Financial guarantee liabilities |
748,674 |
|
|
1,449,566 |
|
|
224,509 |
|
Deferred tax liabilities |
5,733,733 |
|
|
4,689,672 |
|
|
726,338 |
|
Lease liabilities |
979,419 |
|
|
824,881 |
|
|
127,758 |
|
Convertible promissory note payable |
10,117,188 |
|
|
10,401,192 |
|
|
1,610,940 |
|
Optionally convertible promissory notes |
7,530,542 |
|
|
7,701,487 |
|
|
1,192,808 |
|
Other liabilities |
2,736,934 |
|
|
2,542,952 |
|
|
393,853 |
|
Total liabilities |
165,738,926 |
|
|
217,870,020 |
|
|
33,743,769 |
|
Equity |
|
|
|
|
|
|||
Share capital |
77 |
|
|
77 |
|
|
12 |
|
Share premium |
33,213,426 |
|
|
33,213,426 |
|
|
5,144,105 |
|
Treasury shares |
(2 |
) |
|
(1,814,486 |
) |
|
(281,028 |
) |
Other reserves |
7,418,710 |
|
|
7,456,750 |
|
|
1,154,904 |
|
Retained earnings |
40,927,597 |
|
|
50,696,590 |
|
|
7,851,902 |
|
Total equity attributable to owners of the Company |
81,559,808 |
|
|
89,552,357 |
|
|
13,869,895 |
|
Non-controlling interests |
1,591,513 |
|
|
1,521,380 |
|
|
235,632 |
|
Total equity |
83,151,321 |
|
|
91,073,737 |
|
|
14,105,527 |
|
Total liabilities and equity |
248,890,247 |
|
|
308,943,757 |
|
|
47,849,296 |
|
|
|
|
|
|
|
LUFAX HOLDING LTD |
||||||||||||||||
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||||||||||
(All amounts in thousands, except share data, or otherwise noted) |
||||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|||||||||||||
|
2020 |
|
2021 |
|
2020 |
|
2021 |
|||||||||
|
RMB |
|
RMB |
|
USD |
|
RMB |
|
RMB |
|
USD |
|||||
Net cash generated from operating activities |
1,551,580 |
|
2,119,461 |
|
|
328,263 |
|
|
4,476,469 |
|
|
3,903,849 |
|
|
604,629 |
|
Net cash generated from/(used in) investing activities |
1,184,650 |
|
(1,358,421 |
) |
|
(210,393 |
) |
|
(369,071 |
) |
|
(5,198,665 |
) |
|
(805,171 |
) |
Net cash generated from financing activities |
4,068,231 |
|
363,769 |
|
|
56,341 |
|
|
3,743,843 |
|
|
2,286,217 |
|
|
354,090 |
|
Effects of exchange rate changes on cash and cash |
47 |
|
(85,377 |
) |
|
(13,223 |
) |
|
(9,169 |
) |
|
(61,670 |
) |
|
(9,551 |
) |
Net increase in cash and cash equivalents |
6,804,508 |
|
1,039,432 |
|
|
160,988 |
|
|
7,842,072 |
|
|
929,731 |
|
|
143,997 |
|
Cash and cash equivalents at the beginning of the |
8,349,625 |
|
23,675,950 |
|
|
3,666,938 |
|
|
7,312,061 |
|
|
23,785,651 |
|
|
3,683,928 |
|
Cash and cash equivalents at the end of the period |
15,154,133 |
|
24,715,382 |
|
|
3,827,925 |
|
|
15,154,133 |
|
|
24,715,382 |
|
|
3,827,925 |
|
1The take rate of retail credit facilitation business is calculated by dividing the aggregated amount of retail credit facilitation service fee, net interest income, guarantee income and the penalty fees and account management fees by the average outstanding balance of loans facilitated for each period.
2High-quality borrowers refer to G1-G3 borrowers. The Company groups its qualified borrowers into eight risk levels, with G1 representing the lowest risk and G8 representing the highest risk among qualified borrowers. A borrower’s risk level is determined based on two primary considerations. The First is credit risk score, modeled using statistical techniques and based on the records of the Credit Reference Center of the People’s Bank of China and the borrower’s prior records such as repayment, delinquency and application histories. The other consideration takes into account the customer’s assets, such as residential property, vehicle and insurance policies. Borrowers with higher credit risk scores and better assets will be assigned a lower risk level.
3 Flow rate estimates the percentage of current loans that will become non-performing at the end of three months, and is defined as the product of (i) the loan balance that is overdue from 1 to 29 days as a percentage of the total current loan balance of the previous month, (ii) the loan balance that is overdue from 30 to 59 days as a percentage of the loan balance that was overdue from 1 to 29 days in the previous month, and (iii) the loan balance that is overdue from 60 to 89 days as a percentage of the loan balance that was overdue from 30 days to 59 days in the previous month. Loans from legacy products and consumer finance subsidiary are excluded from flow rate estimation.
4 DPD 30+ delinquency rate refers to the outstanding balance of loans for which any payment is 30 to 179 calendar days past due divided by the outstanding balance of loans. Loans from legacy products and consumer finance subsidiary are excluded from calculation.
5 DPD 90+ delinquency rate refers to the outstanding balance of loans for which any payment is 90 to 179 calendar days past due divided by the outstanding balance of loans. Loans from legacy products and consumer finance subsidiary are excluded from calculation.
6 Legacy products of the wealth management business refer to a variety of products and related services that the Company has historically offered but no longer offers, primarily due to shifts in strategy and regulatory requirements. Legacy products are primarily comprised of certain types of structured alternative products originated from financial institutions and peer-to-peer platforms.
7 As of June 30, 2021, client assets in legacy products were RMB0.4 million, representing overdue balances to be paid out by insurance companies.
8 The take rate for the wealth management business is calculated by dividing total wealth management transaction and service fees for current products by average client assets in the Company’s current products.
9 The liquid assets consist of Cash at bank, Financial assets at amortized cost, Financial Assets purchased under reverse repurchase agreements and Financial assets at fair value through profit or loss with a maturity of 90 days or less as of June 30, 2021.
View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005603/en/
Investor Relations
Lufax Holding Ltd
Email: Investor_Relations@lu.com
ICR Inc.
Robin Yang
Tel: +1 (212) 537-0429
Email: lufax.ir@icrinc.com
Source: Lufax Holding Ltd