360 Finance Inc (NASDAQ:QFIN) Q4 2019 Earnings Conference Call - Final Transcript

Mar 27, 2020 • 08:00 am ET


360 Finance Inc (NASDAQ:QFIN) Q4 2019 Earnings Conference Call - Final Transcript


Loading Event

Loading Transcript

Q & A

Thank you. [Operator Instructions] The first question today comes from Jacky Zuo. Please go ahead.

Jacky Zuo

Hi, management. Thanks for taking my questions. I have two questions. First is on the loan originations in our guidance. So can you give us some color on the first quarter loan originations given that we are coming to the end of March and also regarding our 2020 loan origination guidance. Just want to know, was the assumptions behind -- for example, what's the distribution of the quarterly originations we are expecting for this year?

And second question is about the asset quality. So it's very helpful to know our D1 delinquency rates is expected to be 7.2% to 7.3% at the end of this quarter, up from about 7, sorry, 6.8% from last quarter. So I just want to know in terms of vintage loss, which will be the level we are expecting given the current virus? And also I noted that we actually set aside a large provision during the quarter, it's over RMB700 million. So just want to know what is the assumption behind this additional provisioning. It seems it's about 1% of our loan balance at the end of last year. Is that the kind of level of provisions we expect for the impact from the virus? Thank you so much.

Alex Wu

Thank you, Jacky. Let me take the question first. And probably Haisheng and Zheng Yan will add on that. This is a very important question. The first one is to guidance. Yes. We issued our guidance for the full year, the loan origination RMB200 billion to RMB220 billion. The rationale behind that is spending at today's situation is a little bit unclear for the future, but we are very confident that we are -- everything's under control. But just as you know our company always take a relatively conservative measure in terms of daily operation. So we want to keep the guidance as flat as last year, because last year, the overall loan origination -- the total loan origination is RMB198 billion. So that's the key rationale for that and hopefully if we see any recovery signs from the outbreak of COVID-19, this number will have a positive adjustment in the future. And just add other few color on this, our underlying assumption is that we would expect the capital-light model will continue this growth and to pursue our strategy that technology enables us.

And the second thing is that we would continue to see the acquisition cost to remain at a relatively low level and that's the information we can share with you on this call. And the second -- your second question talking about the asset quality. Oh, yes, For the first question you asked about Q1. Certainly as of today, all the numbers are subject to the auditors' review, but all we can say is that we see the loan origination for the first quarter should be around RMB50 billion, so that give you a rough sense of