Operator
Thank you for standing by and welcome to the Lexington Fintech Holdings Limited second quarter 2025 earnings conference call. All participants are in listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand conference over to Mr. Wilkheim. Please go ahead.
Thank you, operator. Hello, everyone. Welcome to our second quarter 2025 earnings conference call. Our results were released earlier today and are currently available on our IR website. Today, you will hear from our chairman and CEO, Mr. Jay Wenjiexiao, who will provide an update on overall performance and strategies of our business. Our CFO, Mr. Arvin Zhangwenchiao, will then provide more details on our risk management initiatives and updates. Lastly, our CFO, Mr. James Zeng, will discuss our financial performance. Before we continue, I would like to refer you to our safe harbor statement in our earnings press release, which also applies to this call, as we will be making forward-looking statements. Last, please note that all figures are presented in renminbi terms, and all comparisons are made on a quarter-over-quarter basis unless otherwise stated. Please kindly note Jay and Arvind will give their whole remarks in Chinese first, then the English version will be delivered by Jay's and Arvind's AI based voices. With that, I am now pleased to turn over the call to Mr. Jay Wenjiexiao, Chairman and CEO of Lexing.
Thank you very much. 七月份公司又宣布了未来一年内六千万美元的股票回购计划 公司股东回报率进一步提升 已经达到行业的回报前列 接下来我跟大家介绍二期组重点的工作和具体的进展 第一 独特的生态业务持续健康发展 核心竞争力正在持续的提升 公司的经营韧性明显增强 分期零售业务聚焦于年轻客群的刚需消费,我们全面升级了供应链,引入数十家行业TOP级别的品牌商家,加强了真品会工厂店等模式,充分契合了用户多元化的消费需求。 We did the same thing at 2018. And more than 30%, And lower class withoda-ssa. In the most recent infrastructure, In the secondater's axis, Next we have mainly with theyy-stick asta firxfajrlynnum, 盈利性足迹正在增长 个人消费信贷业务加速布局 我们新增了多个投资平台合作 占据了有利的声位 为未来进一步的增长 认定了基础 数科业务依托标准化的系统和风险管理能力 持续助力多家银行高效对接各大住在平台 提高了银行速度化风险管理能力 广受合作银行的认可 季度内 宿客业务的规模及用户都有显著的增长 发展势头良好 海外业务 我们持续加强了中后台的人力建设 季度内取得了不错的进展 连续多个季度 规模和营收 环比大幅增长 第二 提升产品服务体验 促进优质客户 规模稳步增长 二季度我们丰富了产品矩阵 为用户提供有竞争力的offer和灵活的还款方式 匹配用户全生命周期的产品和服务需求 用户年轻大幅增强 针对优质的个人消费信贷客户 推出定价更具竞争力的新热金卡 满足了用户的随借随环 探日机器的一些个性化需求 产品上线后 广受用户欢迎 针对优质的普惠小微 3. AI 3. AI 4. AI 以用户为中心的服务理念 持续优化用户服务体验 高效响应用户的需求 努力提升消费者的获得感与性能感 我们持续聚焦消宝治理顶层设计与长项机制的建设 推进消宝融入全业务链路 以用户虚情与产品体验作为双驱动引擎 构建预建式的权益保护体系 推动消费者保护工作 高质量的发展 季度内 我们加大了消宝工作的科技投入 完善数字化 模型化工具五十余项 提升了服务响应率 用户满意度 展望未来 三季度我们将保持规模平稳 风险持续下降 盈利稳步增长 住在新规将在四季度落地实施 尽管新规可能会对行业带来一些变化 但我们相信新规将有利于行业的长期健康发展 尤其有利于热性这样高度重视合规的平台 我们将积极发挥热心的业务生态协同优势 达到我们差异化的一些竞争优势 推动公司稳健的经营 因此我们维持全年经理论同比大增的整个业绩指引 接下来我把发言时间交给CIO Evan
transformation towards a business model by data analytics, risk management, and refined operations. Despite macroeconomic uncertainties, our current strategy has led to continued profitability recovery and sustainable growth. In the second quarter, total GMV reached 52.9 billion RMB, a quarter-over-quarter growth of 2.4%. Revenue increased by 16% to 3.6 billion RMB. Net profit reached 511 million RMB, representing quarter over quarter growth of 19%, and year over year growth of 126%, a record high in the past 14 quarters. The excellent quarterly results are driven by the sustained improvement of asset quality and resilient growth across our business ecosystem. The management has always placed great emphasis on shareholder returns and remains committed to improving shareholder returns through various means. Starting from the second half of this year, our cash dividend payout ratio is raised from 25% to 30%. Also, in July, the company announced a $60 million share repurchase plan to be executed within the next 12 months. These measures will further raise the company's shareholder returns above the industry average level. Now let me introduce the specific business progress we have made in the second quarter. First, our unique business ecosystem has sustained strong growth, which has enhanced our competitiveness and strengthened our operational resilience. Our installment e-commerce business focuses on the essential consumption needs of young customers. In the second quarter, we comprehensively upgraded our supply chain and partnered with dozens of top-tier brands to expand our product matrix. Also, we fully tapped into users' diverse consumption demands through two merchandising categories, high-quality offerings and factory outlet products. In addition, based on our user insights, we developed and optimized our hyper-personalization approach to customize operation and risk strategies for different segments of customers. During the June 18th shopping festival, our e-commerce GMV increased by 139% year-over-year, putting this business firmly on a rapid expansion path. For offline inclusive finance business, we strengthened localized operations and expanded our business into lower-tier cities. By adopting customized risk management and differentiated competition strategies, enhancing our service capabilities, and improving our efficiency to serve small and micro-business owners, the profitability of inclusive finance business achieved steady sequential growth. For online consumer finance business, we accelerated its development by partnering with multiple leading platforms to secure a favorable market position, laying a solid foundation for future For our tech empowerment business, we leveraged our standardized systems and risk management expertise to help partner banks efficiently connect with major platforms, enhancing their data-driven risk management capabilities, and have gained wide recognition from our partner banks. During the quarter, the business sole significant increase in business volume and number of users, maintaining robust growth momentum. For overseas business, we continue to strengthen mid- and back-end capabilities, making notable progress during the quarter. It delivered substantial quarter-over-quarter growth in both business volume and revenue for multiple consecutive quarters. Second, we strove for product service excellence to drive the growth of quality user in our online credit business. In the second quarter, we expanded our product portfolio, offering users competitive terms and flexible repayment options to meet their product and service needs throughout the full life cycle, significantly increasing user engagement. For Prime customers, we launched a product with more competitive pricing, upgraded Lojin card, catering to their demands for on-demand borrowing and repayment with daily interest calculation. The product has been well received since its launch. For qualified small and micro business owners, we partnered with banks to introduce products with flexible terms, further reducing financing costs, and precisely meeting the needs of the segment. Third, AI further enhanced our business quality and efficiency. Our locally deployed large AI models deeply applied in most business scenarios for example in post loan management the intelligent data-driven platform has achieved full process end to end AI support ranging from case allocation and collection operations to customer operation and repayment strategies effectively improving the post loan collection rate the company's self-developed AI agents have also made significant progress. With 50 AI agent roles currently deployed in key business areas such as operational strategy generation, credit strategy review, and automated monitoring, greatly enhancing our operational efficiency, the company adheres to a user-centric philosophy and strives to enhance consumer satisfaction and trust by optimizing user service and experience and responding to user needs efficiently. We remain focused on the top-level design and long-term mechanisms for consumer rights protection governance, integrating consumer rights protection into all business processes. Also, we have built a proactive consumer rights protection system to advance the high-quality development of consumer rights protection. During the quarter, we increased technology investment in consumer protection and have refined over 50 digital and model-based tools to improve service response and user satisfaction. Looking ahead, we will maintain table business scale, further reduce risks, and sustain profit growth in the third quarter. Although the new regulation of loan facilitation, which is to take effect in the fourth quarter, may bring some changes to the industry, we believe it will foster the healthy development of the industry, particularly benefiting platforms like collecting that place high importance on compliance. We will strengthen our business ecosystem synergy to build a unique competitive advantage and ensure continued business growth. As such, we maintain our full-year guidance of achieving significant year-over-year profit growth.
Speaker 7
Now, I would like to give the floor to our CRO Arvin. 谢谢 下面我将汇报一下二季度风险管理方面的工作情况和进展 二季度外部经济环境和行业环境依然复杂 不确定性比较高 我们快速行动采取有针对性的风险管理措施 应对外部的风险影响 确保风险继续保持下降趋势 重点聚焦于易受行业风险波动影响客群的识别处置 通过交互式reoffer大力促进优质客户的规模增长 利用大模型升级风控能力提升风险决策的效率和额度价格策略的精准性 通过一系列的风险管理措施确保了二季度无论是新增资产还是全量资产的风险继续保持下降趋势 具体来说二季度新增资产FTT7相比一季度下降了约5%左右 全量资产入催率下降了2%左右 全量资产90加不良率下降了160左右 下边向大家介绍一下我们在二季度采取的重点风险管理举措 一方面,在模型识别能力见识上,二季度我们持续优化数据模型,并重点对易受行业风险波动影响了客户进行专项识别和处置 首先,我们基于公司在过去多个信贷周期积累的信贷风险持续数据,运用因果推断技术,构建了评估客户风险对环境变化敏感度的风险识别模型 该模型效果显著在相同风险评级的客户中识别出的高敏感客户是当下的情境下风险是低敏感客户的1.5倍以上 其次我们重点应用客户画像工作稳定资产状况等稳定性更强的数据来加强对于长期表现风险的预测能力 从而为优质客户提供更稳定的信贷规模促进优质规模的一个增长 第二部分是继续加强正式向风险管理 一方面针对上述模型识别出的易受行业风险影响 风险上升幅度比较大的客户及时采取清退降额处置 提前应对潜在的行业风险影响 另一方面持续提升优质客户的offer能力 二季度通过上线交互式 第二季度我们对商城进行了持续的风险管理体系的升级,在搜索TZM,Offer,Pay,交易审批,Re-offer,建立毫秒级的实时风险决策能力,在控制风险的前提下,满足不同消费者的商品交易需求,基于独立的风控体系, 电商模型的识别能力环比提升了30%以上 商城用户尤其是优质用户的受信和下单通过率大幅提升 促进电商业务的快速增长 最后我们继续加大智能化风控工具建设和应用 利用最新的大模型技术研发和落地了额度机器人 在额度决策上决策的效率和效果均取得了良好的效果 定价机器人通过实验数据建立价格曲线 动态优化利率策略 在风险可控的前提下 大幅改善了降价带来的规模增长 未来我们将持续加大大模型在风险管理上的应用探索 推动风险管理 存量化风险管理 向智能化风险管理方向迭代升级 构建在风险管理能力上的领先优势 单季度外部环境和行业波动不确定性依然比较大 我们将继续加强风险管理 积极应对风险变化 利用风险资产自动巡减和处置能力 加强准入交易管理 提升高风险客户的处置能力 同时继续优化受信额度策略 更好地满足优质客户的需求 全面提升用户体验 促进优质资产规模继续增长 保障资产风险水平继续下降 下面有请CFO Jims介绍公司二季度的财务表现情况 Thanks, Jay.
Speaker 8
Next, I will provide a review of our key initiatives and achievements in risk management for the second quarter. In the second quarter, while the macroeconomic and industry environment remained complex and uncertain, we took swift action to address the potential impacts and maintain the downward trend in risks. Specifically, we focused on identifying customers vulnerable to industry fluctuations and taking measures to mitigate potential risks. Also, we adopted interactive re-offers to drive the increase of high-quality asset volume. In addition, we leveraged large models to upgrade our risk management capabilities, improving the efficiency of risk decision-making and the accuracy of pricing and credit line strategies. Thanks to the initiatives we've taken, risks of both new and overall assets continue to decrease. Leading risk indicator for new loans, first payment default, FPD, over seven days of the second quarter declined by about 5% compared to the previous quarter. On total loan portfolio, day one delinquency ratio decreased by about 2% and 90 days delinquency ratio decreased by 6% quarter over quarter. I will introduce in detail the key initiatives we've taken for the second quarter. First, in terms of risk identification, we continued to optimize data models in the second quarter, focusing on identifying customers who are vulnerable to industry fluctuations and mitigating potential risks. Based on the accumulated data on time series changes of credit risk across multiple credit cycles, we employed causal inference techniques and scenario simulations to develop a risk identification model that assesses customers' risk sensitivity to environment changes. The model has proven to be highly effective. Among customers of the same risk rating, those who are identified as highly sensitive exhibit 1.5 times risk level of low sensitivity customers in the current environment. In addition, we focused on using data that shows greater stability features such as customer profiles, job stability, and personal asset status to enhance our predictive capability for long-term risks, thereby providing more reliable credit services to high-quality customers. Second, we continue to strengthen risk management through preventive and proactive approaches. For customers identified by our model who are vulnerable to external environment changes and show higher risks, we've promptly taken measures such as reduction or suspension of their credit lines in order to mitigate the potential impacts of industry risks. Meanwhile, we continue to enhance the competitiveness of offers for quality customers. In the second quarter, we launched a mechanism for customers to supplement credit enhancement documents, conducted personalized real-time re-offering, which combines machine review and manual review, and launched a braided LeGin card, a new financial product featuring higher credit amount and lower fee rate. These measures helped drive the asset volume of prime customers and number of active customers to increase quarter over quarter. In the third quarter, we will continue to strengthen the risk management strategy that combines preventive and proactive approaches to sustain the risk reduction trend while expanding high quality assets and customers. Third in terms of e-commerce we further upgraded the risk management system for e-commerce which is an independent system from online consumer finance business specifically we established millisecond level real time risk decision-making capabilities across key processes including search recommendations, offer matching, credit approvals, and re-offer, etc. This ensures we meet customers' diverse consumption needs while maintaining risks well under control. Based on the independent risk management system, the risk identification capability of e-commerce platform improved by over 30% compared to the previous quarter. Approval rates for credit application and order placement of platform users, especially quality users, has significantly increased, which has promoted the rapid growth of e-commerce business. Last but not least, we continue to strengthen the development and application of intelligent risk management tools. Leveraging the latest AI large models, we have developed and implemented the credit line robot and pricing robot, which has delivered favorable results. The credit line robot has improved the efficiency and effectiveness of credit line decisions, while the pricing robot significantly improves the volume growth from pricing reduction by establishing price curves based on experimental data and dynamically optimizes pricing strategies. In the future, we will continue to explore the application of large models in risk management, advancing our capabilities from quantitative risk management to intelligent risk management, and building a leading edge in risk management capabilities. In the third quarter, while external uncertainties and industry fluctuations remain, we will continue to strengthen our capabilities in automated high-risk asset screening and resolution, further refine credit approval and lending management, and enhance customer onboarding and transaction management while swiftly addressing high-risk assets. In the meantime, we will further optimize credit approval and credit line granting strategies to better meet the needs of quality customers, improve user experience, and foster continued quality assets growth. These efforts are aimed at ensuring that key risk indicators remain on a downward trajectory. Next, I will hand over to our CFO, James, to provide a review of the company's financial performance for the second quarter.
Thanks, Albert. I will now provide a detailed overview of our second quarter financial results. Please note that all figures are presented in review and all comparisons are made on a quarter over quarter basis, unless otherwise stated. We are pleased to announce another quarter of solid financial performance, marked by robust revenue growth, sustained probability, and expanding margins. We're on track on our probability recovery trajectory. Revenue recorded $3.6 billion in the second quarter, representing a 16% increase quarter over quarter. Net income grew strongly by 19% quarter over quarter, and 126% year over year to reach $511 million. Our net income margin increased to 14.3% from 13.9% last quarter net income take rate calculated as analyzed net income divided by the average loan balance increased 34 basis points to reach 1.92 percent the net income net income margin and net income take rate kept reaching record high for the past 14 quarters laying as up on good profit expansion this set of financial results underscore our ability to turn around and drive sustainable growth in the dynamic market conditions. To gain a clearer understanding of our business growth dynamics, let's take a holistic view of our financial results. First, if we add up credit facilitation service income and tech empowerment service income, net of credit costs, including the provisions and the fair value changes, and the funding costs, we come up with a net revenue of the credit business. The net revenue provides a more accurate reflection of our credit business performance as it absorbs the impact of a different accounting treatment for capital light and capital heavy business as well as the shifting mix across quarters. In the second quarter, the net revenue of our credit business increased by 10% or 183 million to two billion the net revenue of our e-commerce business defined as the e-commerce revenue net of cost of inventory sold increased by 71 percent or 40 million to 97 million so the total net revenue added up to 2.1 billion offering expenses including self-marketing research and development general administrative expenses processing and servicing cost tax and others increased by 9.8 percent or 142 million to 1.6 billion so if we deduct total expense of 1.6 billion from the total net revenue of 2.1 billion we get net income of $511 million increased by 90% or $81 million quarter over quarter. Driving the second quarter's strong financial performance are the following three BINS highlights, namely the flexible volume shift between BINS models, continued improvement in asset quality alongside sufficient provisioning, and a robust growth in our e-commerce BINS. Now let me elaborate more on the three been highlights flexible volume shift between business models highlights operational resilience driving stable growth in volume revenue and net profit from you the economics perspective net income take rate achieved 1.92% this quarter the 34 basis point improvement quarter over quarter is mainly driven by an 82 basis point increase of revenue take rate of credit business, which is calculated by dividing the net revenue by the average loan balance. During the quarter, the net revenue take rate of credit business increased from 6.69% to 7.51%. The increase was mainly driven by the increase of APR, of capital heavy model which increased to 23.2 percent in the second quarter from 22.6 percent last quarter and also the stabilization of early payoff impact happened during the last quarter partially offset by the increase of funding cost the improvement of net revenue takeaway reflects our business resilience in a dynamic and a complex environment. In the second quarter we have observed a reduction in the supply of funds for capitalized business due to the fluctuations related to the new regulation leading to higher funding costs for both capitalized and capital heavy models. To offset the impact we proactively adjusted our business mix, switched more loan volumes from capital light model to capital heavy model in the second quarter the capital light model accounted for 20% of GMV decreased from 27% in the first quarter mainly driven by the decrease of loans from ICP model which only accounted for about 15% of GMV decreased from 24% in the first quarter the proportion of capital heavy model increased to 80% from 73% in the first quarter as you know the borrowers from capital line model typically typically have lower typically have relatively higher risk profiles to reflect this risk premium the average APR of new loans and the capital heavy model increased at the same time the provision increased due to the increase of loans and the capital heavy model. The smooth switch was supported by our enhanced risk management capability which equipped us to accurately assess borrower risk, enabling risk pricing and product offering to optimize probability and the volume growth. Second, asset quality sustained the improvement train and the provision remain prudent and sufficient. Our asset quality has continued to improve for for four consecutive quarters. In the second quarter, 90 day delinquency ratio declined by 16 basis points to 3.1%. FPD seven of new assets further came down by about 5%. Day one delinquency rate of total assets also decreased by about 2% quarter to quarter. Also, our provision remains prudent and sufficient. As mentioned above, in the second quarter, our total credit cost including three provisions line items and the fair value changes of financial guarantees derivatives increased by 13.6% quarter over quarter despite improved asset quality and a decreased loan balance. It is important to note that due to the net accounting policy we have adopted for change in fair value of financial guarantee derivatives and loans and fair value account, the amount was partially offset by guaranteed income and recorded as the next value in our P&L. As such, it only represents part of the actual full provision. As another indicator of the sufficiency of our provisioning, our provision coverage ratio remained ample at 270%, up by two percentage points, quarter over quarter, and reached the highest level in the last four quarters. E-commerce bins gain further traction. Our e-commerce bins is deeply integrated into our ecosystem, creating strong synergies and therefore becomes a unique competitive advantage. E-commerce bins not only generate gross profit by selling merchandise but also creates interest income by providing installment services to customers. Around 97% of e-commerce customers choose to finance their consumption with our installment service. In the second quarter, e-commerce GMB witnessed a substantial quarter over quarter growth of 80% and a year-over-year growth of 117%. E-commerce business growth profit recorded 97 million in the second quarter, up 71% quarter over quarter. Going forward, we continue to expect a strong sequential GMB growth for the e-commerce business. Next I'll go through some specific financial statement items. For our income statement On the revenue side, total revenue reached $3.6 billion, representing a growth of 16% quarter-over-quarter. Credit facilitation service income amounted to $2.3 billion, up 4% quarter-over-quarter, driven by an increase of low volume and the capital-heavy model, higher APRs, and partially offset by the higher funding costs. Tech Empowerment Service Income increased by 33% or $205 million to $830 million mainly thanks to the release of provisions of revenue and IPP model reflecting better than expected asset quality performance and the increased income from our referral services. e-commerce platform service income increased by 69% to 487 million driven by increase to GMB. On the cost and expense side total operating expenses which include processing and servicing costs, sales and marketing, research and development expenses, general and administrative expenses increased by 10% to 1.4 billion, mainly driven by the increase of sales and marketing expenses and processing and servicing costs. For balance sheet items, as of June 30th, our cash position, which includes cash, cash equivalent and restricted cash, was approximately 4 billion RMB. Shareholders' equity remained solid at about 11.6 billion. Looking ahead, despite ongoing market uncertainties an evolving operating environment the management maintains its four-year guidance of achieving a significant year-over-year growth in that income furthermore we remain committed to enhancing shareholders value as demonstrated by our recent 50 million dollars share repurchase program and 10 million dollars CEO share purchase announced in July the board has approved a cash dividend of 0.194 US dollars per ADS for the first half of 2025. The SHIFT repurchase program together with our dividend policy boosted our total shareholder return to above industry average level. Going forward we will continue to evaluate opportunities to ensure we deliver optimal value to our shareholders. This concludes our prepared remarks for today. Operator, we're now ready to take questions.
Operator
Thank you. If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced.
Your first question comes from Emma Zhu with B of A Securities. 已经有一段时间了,那对公司的影响是怎样的,公司是怎样应对,然后第二个问题想问一下这个二季度公司各生态业务发展迅速,能否请管理从分享一下公司对生态业务的后续战略及展望,那我也简单翻译一下我的问题。 So congratulations on the good result amid a challenge environment. So I have two questions. The first one is about the new regulations. So as the new regulation on facilitation has been rolled out for a few months, what impacts has the company observed and what measures will you take to address the impacts? The second question is about the ecosystem. So the ecosystem has developed rapidly in the second quarter. So could you share more on the development strategy and outlook of your ecosystem business?
So, another one, we can see that it will cause整个回收率 actually is一定的下降, so it will bring a一定的风险的波动.
So, this is a translation for Jay Fungster. Thanks for the question. Yes, the new regulation on long participation has been rolled up for some time, but not yet expected. We think the industry has been impacted by this. For listening in the short term, we have observed funding supply chain a bit. which led to an increase in the funding cost of the second quarter. And also, some really matches experience minor fluctuations, for example, collection rate, did increase a little bit.
But when we came out of the new plan, we started to do some kind of a different approach. So we first started to take a look at it. We started to take a look at the plan. 来应对未来可能潜在的一些风险的波动,所以在目前为止我们可以看到其实我们虽然说在整个回收率上略有一些影响,但是我们在整个的一个陆催率还是保持了整个的下降,所以能够比较好的去对冲这部分整个风险波动的整个的影响。 Another thing is that we still have a very unique business environment. So, we can adjust our business structure, and also affect the future.
To address the impact, especially we have technical applications as early as in April. More specifically, we tightened our risk management strategy to mitigate the potential impact of sector-wide risk frustration. Though, I mentioned collection rate decreases a little bit, but our day-one delinquency also decreases the impact of that each other.
Furthermore, leveraging our unique business before this point of advantages, we have the flexibility to assess our business model to navigate the challenges effectively. 长期来看尽管整个的一个住在新规落地会给行业短期带来一些变化和影响 但是新规如果执行将会对行业未来长期的整个的规范和可持续的整个的发展还是有利的 是吧这对于包括热心在内的我们一直以来非常重视合规经营的这个平台来说 从行线来看是利好的 所以我们在历史上 我们也曾经经历过很多次各种整个的一个监管来规范行业的发展 所以我们也能够非常好的去应对整个行业的一些变化来调整自身的整个的一些业务和布局来稳定公司的整个的一个经营 所以我觉得在这方面其实我们还是有比较好的整个的一个经验和能力来应对的
In the past, we also experienced different several rounds of regulation, and I think we have the experience and flexibility to adjust our business model to navigate the challenges. For much more, we only support regulators' efforts to supervise and guide back us and will continue to adhere to our customer-centric philosophy, enhance our ecosystem synergy and ensure continuing business growth.
As such, we maintain our senior guidance of achieving significant year-over-year profit growth. 第二个问题就是公司其实在20度我们的生态的各个业务其实还是取得了不错的整个的一个进展 我给大家也做一下简要的一个介绍 像其实在分析零售业务也就是电商业务呢 其实是热心最早的一个业务 我们这个业务已经开展了十几年了 So, that we actually, in the last year, we did the entire business of the company's business to increase the whole risk management system. So we can see that in the last few months, our business of the company's business has been very good. Especially in the last year's 618, we increased our whole supply chain. I mentioned earlier that we talked about a lot of different things.
So in the last year's 618, And regarding your second question about our development of the business ecosystem, actually, our business ecosystem achieved various progress. For our installment business, I'd like to stress that the is the first installment e-commerce platform in China and have been developing this business for over a decade. It has been a crucial part of our ecosystem. And as part of our transformation towards a business model given by data analytics and risk management in the last year, we have built a city-tender risk management system for the e-commerce business. So you can see in the past several quarters our e-commerce long origination volume have sustained significant growth, particularly in the June 18th shopping festival, our GMV increased by over 100%.
另外几个业务呢,像普惠,其实我们还是因为在线下来服务线下的整个的小微及优质的个人消费者. 所以这个业务呢,其实我们在二季度,我们也能够看到这个业务它的整个的一个增长的趋势也是不错的, 尤其是说我们采取了整个的低线城市的整个的一个布局的整个的策略 所以我们可以看到普惠的这一块的整个的资产 是我们自主获客的整个的一个渠道 而且它的整个的一个风险表现 也是长期低于我们整个大盘的整个的风险表现的 所以这块业务还是相对非常稳健的正在增长 另外一块呢 那就是我们的数科业务 数科业务在这个季度 我们还是看到它取得了不错的一个突破 我们上线了多佳新的机构 并且帮助这些新的机构 帮助一些大型的住在平台 也帮助他们能够更好地提升 quello 坚境 tentangoffer管理和资产管理的整个能力 在海外的时候还讲到 也许有多个季度去取得了规模和营收 不错整不错的增长 so in the future we will continue to increase our own business development to continue to improve the development of the business of the world and for our work with the financial business we will continue to expand our business into lower GFD
and just to emphasize that this channel we target at serving the small and micro business owners And the differentiated advantages of the thing is that we have our own self-developed direct sales team. And in the second quarter, we cooperated with several new partners, helping them to connect with large platforms and banks and improve the digital risk management capability. For our tech empowerment business, leveraging our standardized system and risk management expertise, We will continue to help them to connect to the large platforms and to enhance their customer acquisition capabilities. For our overseas business, we have a quarter over quarter sequential growth in those business volume and revenue for multiple consecutive quarters. And as that, we'll continue to enhance team development in order to sustain a healthy and sustainable growth.
Operator
Your next question comes from Alex Yeh with UBS.
So my first question is on the asset quality. So in the current uncertain external environment during the regulatory change, How does Leixin's risk management system can help you better respond to the potential risk fluctuations? And the second question is regarding your ongoing takeaway improvement. Could you also give us more color on the drivers on the underlying negative improvement?
Speaker 7
Thank you. 关于风险的问题有我来回答一下 针对这个新规引发的行业的一个不确定性风险 我们在4月份开始就收紧了新发放资产的风险审核标准 然后保障新发放资产在外部风险不确定的情况下 仍能保持一个下降的一个趋势 同时针对这个全量存量资产我们加强这个还款提醒以及代扣能力的一个升级保障我们全量资产的一个入催也是一个下降趋势 同时呢我们尤其是针对这些易受行业风险波动影响的敏感客户进行有针对性的识别和处置 然后我们通过这个优化数据和提升这个模型能力将易受这种行业影响波动的客户更好的识别出来 然后及时的采取一个清退和降额的处置 然后让我们能够在这一轮的整个风险波动的情况下能仍能保持一个风险的平稳和维建 另外一方面呢除了加强这个风险客户的这个互相处置 我们也积极的去推动和促进优质客户的一个规模增长
提升和优化我们的一个资产结构 通过分子分母两个方面共同的一个调整 然后提升我们的一个资产质量 保证我们的风险的一个持续稳健 In response to uncertainty of the industry rate performance arising from the new loan facilitation regulation, we actually take proactive measures as early as in April. So we tighten three approval standards as early as in April for new customers in order in order to maintain our chance for new risk. And for vintage or existing loan, we improved the early reminders for the loan repayment in order to reduce the . Also, we implemented targeted metrics for customers vulnerable to industrial risk fluctuation. For customers identified as high rate sensitive by our models, we've taken from measures such as reduction and suspension of their credit line to mitigate the potential impact of sector-wide risk. This has helped maintain steadily improving risk performance. Second, we continue to drive high-quality asset growth which will lay a solid foundation for our future high-quality development. We leverage advanced AI models to enhance our risk management system. We also refine customized pricing strategies which has increased the overall competitiveness for prime customers while improving the overall user experience further supporting our high-quality asset growth.
Speaker 7
So overall, we not only reduce the formation of high-grade assets but also try to drive the growth of high-quality assets. 同时面对未来不确定的这个风险波动和影响,我们在二季度也加大了波贝的一个力度,在风险指标持续向好的基础上,我们主动增加波贝金额,然后提升我们应对未来这个信贷周期不决定性的一个抗风险能力。 我们在二季度波贝金额 环比一季度增加了13%以上 增至10个亿以上 然后我们的波贝覆盖力 也有一个稳步的增长 达到了270%左右 然后这个波贝的增加 可以有效的帮我们抵御 未来可能的潜在风险的 波动性的一个影响 总的来说 我们未来将继续贯彻
First, we also change some precision to enhance our rate buffer, enhancing our capability to cope with future and services. In the second quarter, we increased provision by 13.6% to 1.041. The reinforced provision, along with improved risk performance, both our provision coverage ratio rise to 270%. To summarize, we will continue to prioritize high-quality asset growth while also enhancing provisioning and maintaining a state of steadily improving risk performance. In the meantime, while we're continuing to strengthen rate identification and management, we will also ramp up the application of intelligent rate management tools to increase efficiency.
Okay, I will take the net profit take rate question. Almost a year ago, we told the market that thanks to the company's turnaround initiatives, we will be able to gradually improve the business probability and that this will be reflected in our net profit take rate. And I'm happy to tell you that in the last four quarters, we have successfully delivered the promise of improving 20 to 30 basis points each quarter to reach 1.92% in Q2. We're now on track for the goal by the end of the year. As for Q2, really the credit goes to the strong revenue growth from both the credit and the e-commerce business, as I mentioned in my prepared script. Specifically, the net revenue of our credit business increased by 10% quarter per quarter, about 183 million to two million. As a reminder, as I mentioned earlier, if we add up the credit facilitation service income, the tech empowerment service income, net of credit costs, including the provisions and the fair value changes, and the funding cost, we come up with a net revenue for the credit business so if you further break down to the next level the net revenue of the capital heavy model remains stable driven by the increase of low volume under the capital heavy model higher APRs and partially offset by higher credit cost and funding cost by the way as our arm mentioned earlier the increase of credit cost is mainly driven by our prudent provisioning policy. The net revenue of Captain Life model, on the other hand, increased by 33% quarter-over-quarter or about $205 million to $830 million, mainly thanks to the income from our referral services and from the relief of provisions of revenue under the ICP model. This really reflects the better than expected asset quality performance within the ICP. So in addition to the credit bins, the net revenue of our e-commerce bins defined as the e-commerce revenue net of the cost of inventory increased by 71% or 40 million to 97 million also contributing to the increase of our profitability. So with the strong increase of revenue offsetting by some increases from the operation costs and expenses, we get the net profit take rate of 1.92%, a 34 basis point higher than the previous quarter. This fully demonstrates the uniqueness and a strong growth potential of our diversified business ecosystem. Looking forward for Q3, we continue to expect relatively stable volume, improved risks, strong quarter-over-quarter net income growth. Therefore, we continue to expect the net income take rate will improve in a similar pace as before.
Your next question comes from Alan Chen with Citibank. 美元的回购计划,就请管理层的那么哥们帮我们分享一下这个回购计划背后的一些考量, 然后很重要的是就往后看,咱们不管是通过回购也好,分红也罢, 咱们现在还有没有一些什么计划或者空间进一步加大这个股东回报,非常感谢。 我很快翻译一下,Thanks for taking my question. This is Alan from Citibank. I just have a quick question on shareholder return. Notice that in July, you have announced a 15-minute share repurchase program. I'm just wondering management, if you could give us a little bit more color on the thought process and rationale behind the buyback program. And on top of that, if management has any plan to further boost shareholder return in the future.
Thanks. 若本次的整个的一个回购金额全部执行的话 那结合 我们之前有两次上调了整个的分红派息率 公司整体的整个的股东回报水平 已经能够达到行业的整个的一个前列了 结合当前不到四倍的整个的一个PE的估值吧 我们认为公司还是具备比较好的整个投资价值 本次回购和真实也充分彰显了公司管理成为公司未来发展前景的一个坚定的信息 也再一次证明了公司在不断提升股东回报方面具有这样的能力还有这样的一个诚意 在回购的整个具体的实施方面呢 我们将会在本次据报发布之后开始其中回购 我们会严格遵守回购的交易相关规则
并且我们会按季度向市场汇报我们整个回购的一个进度 公司还是充分重视股东的整个回报 未来公司也将会持续探索通过各种方式 来将公司的整个价值回归给股东
This is the translation of Jay Farns On July 21st, we announced a 50 million share repurchase program to be executed over the next 12 months. In addition to that, I plan to purchase up to 10 million year-dollar worth of shares using my personal funds. If the company's repurchase program is fully executed alongside a few increases in the cash dividend payout ratio, our total shareholder return will rise above the industry average. With a 4-pe ratio below both times, the company has compelling investment value. This repurchase program underscores the management confidence in the company's value and reinforces our commitment to delivering value to our shareholders. In terms of repurchase execution, we will implement the program after the second quarter results release and will strictly follow repurchase rules while taking into account market conditions. We will make regular updates on repurchase progress in our quarterly earnings release. As I said, the company values shareholder returns and will continue to explore various means to deliver value to our shareholders.
Operator
Thank you. That does conclude our question and answer session. I'll now hand back for any closing remarks.
Operator
Thank you. This conference is now concluded. Thank you for joining today's call. If you have any more questions, please do not hesitate to contact us. Thanks again.
