Yiren Digital Ltd. · NYSE:YRD
Yiren Digital — Q4 2022 Earnings Presentation
30 slides from Yiren Digital's earnings presentation, Mar 16, 2023
Slide 1: Yiren Digital Investor Presentation 4Q22
Yiren Digital Investor Presentation 4Q22 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement This material contains forward-looking statements. These statements constitute “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These f
Slide 3: Contents
Contents 1 Key Financial Updates 2 Business Models and Strategies 3
Slide 4: 4Q22 Highlights
4Q22 Highlights +50% +21% +39% +12pp yoy yoy yoy yoy Number of Net Income Total Insurance Total Client Borrowers Margin Premiums Asset Served Continued improvement in profitability and recovery in scale growth 4
Slide 5: Wealth Solutions Gaining Traction
Wealth Solutions Gaining Traction Total Client Asset Number of Active clients from Hexiang and Yiren Select (RMB Million) 25,000 23,380 23,372 700,000 22,796 621,137 600,000 578,562 20,000 19,261 535,928 17,415 500,000 427,873 424,366 14,660 15,000 400,000 385,536 10,679 307,107 300,000 10,000 200,0
Slide 6: Loan Volume Driven by Our Borrowers
Loan Volume Driven by Our Borrowers Number of Borrowers Loans Facilitated (RMB Million) 862,226 827,767 12,000 737,320 10,000 9,541 618,131 548,495 8,000 6,842 6,784 434,153 6,170 6,299 6,000 5,253 345,939 4,930 5,280 Quarterly avg. for 9M of 2022 4,000 2,000 0 1Q21 2Q21 3Q21 4Q21 1H22 3Q22 4Q22 1Q2
Slide 7: Financial Metrics
Financial Metrics Net Revenue GAAP Net Income (RMB Million) (RMB Million) 1,600 1,506 600 1,400 1,232 500 485 1,200 1,125 439 1,100 1,088 1,021 1,000 400 841 321 331 800 782 Quarterly avg. 300 270 for 9M of 2022 237 600 200 Quarterly avg. 200 181 for 9M of 2022 400 100 200 0 0 1Q21 2Q21 3Q21 4Q21 1H
Slide 8: Delinquency Rates
Delinquency Rates 15-29 days 30-59 days 60-89 days 2.0% 1.9% 1.5% 1.5% 1.4% 1.3% 1.3% 1.2% 1.1% 1.1% 1.0% 1.0% 0.9% 0.9% 0.8% 0.7% 0.7% 0.7% 0.6% 0.6% 0.5% FY19 FY20 FY21 1Q22 2Q22 3Q22 4Q22 Note: The slight uptick of delinquency rates in 4Q22 was mainly due to COVID resurgence and infection peak. E
Slide 9: Contents
Contents 1 Key Financial Updates 2 Business Models and Strategies 9
Slide 10: Yiren Digital: A Leading Digital Personal Financial Management Platform
Yiren Digital: A Leading Digital Personal Financial Management Platform Credit-Tech Holistic Wealth Comprehensive Financial Management Solutions Cash account Insurance account Investment accounts liquidity Management Wealth Protection Wealth Appreciation Consumption + Business Protection Investment
Slide 11: Credit Tech: Technology Driven Loan Facilitation Model
Credit Tech: Technology Driven Loan Facilitation Model Loan Repayment Customer Referral， Credit Application Collections & AI Risk/Anti-Fraud Risk Mgmt Services Institutional Borrowers Post-facilitation Funding Provides Funding Services Partners Intelligent KYC E-Signing Platform Funding 11
Slide 12: Credit-tech Business Mapping
Credit-tech Business Mapping Diversified product matrix, covering different scenarios Unsecured revolving loans SME loans Young Internet customers/ employees with stable income Online Covering a variety of life scenarios and flexible credit needs Small business Online owners with recurring operating
Slide 13: Full Spectrum of Credit Products: Small Revolving Loans
Full Spectrum of Credit Products : Small Revolving Loans 1 2 Customer Acquisition Channels Self-Developed Diversified Consumption Scenarios E-commerce Platforms Lifestyle Financial Services E-commerce Offers flexible installment-based Travel Entertainment payment options Average Principal Amt Loan T
Slide 14: Full Spectrum of Credit Products: SME loans
Full Spectrum of Credit Products : SME loans SMEs Across Varied Industries Diversified Channel Partners Tech-driven Credit Service SaaS Machine Learning & Model Building Data-driven Risk Pricing E-commerce Cross-platform Customized Service Accumulatively Served Yixianghua Offers fast-track installme
Slide 15: Holistic Wealth Solutions
Holistic Wealth Solutions Customer Spectrum Positioning Products Retail Clients Corporates Partnering with varied corporates/institutions One-stop holistic wealth Credit-Tech CreditEase Ecosystem solutions platform targeting Catering to the comprehensive the mass affluent needs of mass affluen
Slide 16: Hexiang Insurance: Business Highlight and Differentiation
Hexiang Insurance: Business Highlight and Differentiation • Differentiated positioning：Providing comprehensive customized and scenario-based insurance services • Competitive edges：1）Nationwide business deployment 2）Experienced teams on property, life insurance and internet industry 3）Strong capaciti
Slide 17: Hexiang Growth Strategy: 2B2C Model
Hexiang Growth Strategy: 2B2C Model Customized Scenario-based Insurance Rich Application Scenarios products under 2B2C model Hexiang Insurance Medicine & Healthcare Travel & Leisure Serving both 2B and 2C clients with diversified products. 2B Corporate Clients After being served by Hexiang, working
Slide 18: Yiren Select: One-stop Holistic Wealth Solution Platform
Yiren Select: One-stop Holistic Wealth Solution Platform Holistic Wealth Selected Life Study Investment Financial product and institutional service Health management Self-improvement Asset Allocation partners suppliers sports and Leisure and child Knowledge and education strategy Yiren Communities -
Slide 19: Revenue Models and Monetization
Revenue Models and Monetization Hexiang Insurance Broker Insurance commissions Holistic Wealth Yiren Select Advertising fees Platform External funding Loan facilitation/post facilitation service fees (Customer acquisition, partners risk profiling, collection, etc.) Credit-Tech Loan Loan facilitation
Slide 20: Growth Strategy
Growth Strategy 1 Integrating different business lines 3 Credit-tech: In response to to explore customers’ long-term Consumption regulatory direction, transitioning to C comprehensive financial (moving to 24% APR customers)+ B management needs strategy (SMEs) Wealth Solutions Protection 4 Driving up
Slide 21: Massive Opportunity in China's Personal Financial Services Industry
Massive Opportunity in China’s Personal Financial Services Industry Wealth Solution Consumer Finance Increasing Investment Needs Market in China (in RMB trillion) (By outstanding balance, RMB trillion) 400 23.4 348 350 50.0% 300 Mass Affluent Prime Clients Borrowers 15.9 250 216 200 174 48.4% 150 10
Slide 22: Appendix
— APPENDIX 22
Slide 23: Income Statement
BASH YIREN DIGITAL | ncome State me nt ‘Unandited Condensed Consolidated Statements of Operations (Gn thousands, except for share, per share and per ADS data, and percentages) For the Three Months Ended For the Year Ended December 31, September 30, December 31, December 31, December 31, December 31,
Slide 24: Cash Flow Data
BASH YIREN DIGITAL Cash Flow Data Unaudited Condensed Consolidated Statements of Operations (in thousands, except for share, per share and per ADS data, and percentages) For the Three Months Ended For the Year Ended December 31, September 30, December 31, December31, December 31, December 31, Decemb
Slide 25: Balance Sheet
Balance Sheet audited Condensed Consolidated Bal: (in thousands) Asof December 31, September 30, December 31, December 31, 2021 2022 2022 2022 RMB RMB RMB UsD Cash and cash equivalents 2,864,543 3,612,972 4,271,899 619,367 305,018 274,623 221,004 32,044 Contract cost 9,959 1,610 787 114 Loans at fai
Slide 26: Operating Highlights
Operating Highlights Operating Highlights and Reconciliation of GAAP to Non-GAAP Measures (in thousands, except for number of borrowers, number of investors and percentages) For the Three Months Ended For the Year Ended Deceniber 31, September 30, December 31, December 31, December 31, December 31,
Slide 27: Delinquency Rates
Delinquency Rates Delinquency Rates (Loan Facilitation Model) 15-29 days 30-59 di: 60-89 ; J 0.8% 13% 1.0% 3 15% 1.2% z we S Sy 3 n 8 0.6% 14% as x » rs) 3 n is) 0.7% 13% 1.1% g if | ; J yD S 8 S 0.6% 3 1.1% g inf 8 8 8 0.7% 15% a & a ° 2 © 2 s 30, 2022 0.6% yD S 2 o 0.7% So 3 © 2 3 ; J re 8 3 g 3 o
Slide 28: M3+ NCO by Vintage
M3+ NCO by Vintage 4 BAIA Net Charge-Off Rate (Loan Facilitation Model) Loan Amount of Loans Accumulated M3+ Net Issued Facilitated Charge-Off Total Net Charge-Off Rate Period During the Period as of December 31, 2022 as of December 31, 2022 (in RMB thousands) (in RMB thousands) 2020 9.614.819 780.7
Slide 29: M3+ NCO by Vintage
M3+ NCO by Vintage 4 BAIA M3+ Net Charge-Off Rate (Loan Facilitation Model) Loan Issued Month on Book Period 2019Q1 0.0% 08% 2.0% 34% 53% 59% 63% 63% 63% 63% 6.3% 2019Q3 0.2% 2.9% 68% 9.0% 104% 12.0% 13.2% 13.8% 144% 146% 146% 2020Q1 0.6% 2.3% 41% 52% 60% 62% 66% 72% 7.7% 7.9% 2020Q3 11% 3.3% 5.1% 6
Slide 30: Thanks!
—— THANKS! 30