REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
US$0.00001 per share* |
* | listing on the New York Stock Exchange of American depositary shares. |
Accelerated filer ☐ | Non-accelerated filer ☐ |
Emerging growth company |
U.S. GAAP ☐ | Other ☐ | |||
International Accounting Standards Board ☒ |
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Item 1. |
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Item 2. |
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Item 3. |
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Item 4. |
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Item 4A. |
149 |
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Item 5. |
149 |
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Item 6. |
170 |
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Item 7. |
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Item 8. |
184 |
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Item 9. |
185 |
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Item 10. |
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Item 11. |
203 |
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Item 12. |
211 |
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214 |
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Item 13. |
214 |
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Item 14. |
214 |
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Item 15. |
214 |
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Item 16A. |
215 |
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Item 16B. |
215 |
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Item 16C. |
215 |
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Item 16D. |
216 |
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Item 16E. |
216 |
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Item 16F. |
217 |
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Item 16G. |
217 |
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Item 16H. |
217 |
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Item 16I. |
217 |
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218 |
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Item 17. |
218 |
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Item 18. |
218 |
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Item 19. |
218 |
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223 |
• | “active investors” refer to investors who have made at least one investment through our wealth management platform or have had client assets with us above zero in the past twelve months; |
• | “ADSs” refer to our American depositary shares, with every two ADSs representing one ordinary share; |
• | “AI” refers to artificial intelligence; |
• | “APR” or “annualized percent rate” refers to the monthly all-in borrowing cost as a percentage of the outstanding balance annualized by a factor of 12, where all-in borrowing cost comprises the actual amount of (a) interest, (b) insurance premiums or guarantee fees and (c) retail credit facilitation service fees; |
• | “China” or the “PRC” refers to the People’s Republic of China, excluding, for the purposes of this annual report only, Hong Kong, Macau and Taiwan; |
• | “client assets” refer to the outstanding balance of client assets generated through our platforms, where an asset is counted towards the outstanding balance for so long as it continues to be held by the investor who acquired it through our platform; |
• | “consolidated affiliated entities” refers to entities in China with which we have contractual arrangements such that we have effective control over and are considered the primary beneficiary of those entities and we have consolidated their financial results in our consolidated financial statements; |
• | “cumulative borrowers” refer to the cumulative number of borrowers who had submitted their loan application request and successfully made drawdowns since our inception; |
• | “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 |
• | “IFRS” refers to International Financial Reporting Standards as issued by the International Accounting Standards Board; |
• | “legacy products” mainly include (1) a category of unsecured revolving credit lines in our retail credit facilitation business and peer-to-peer business-to-consumer |
• | “Lufax,” “we,” “us,” “our company” and “our” refer to Lufax Holding Ltd, a Cayman Islands exempted company, and its subsidiaries, and, in the context of describing our operations and consolidated financial information, also include the consolidated affiliated entities in China, including Shanghai Xiongguo Corporation Management Co., Ltd., Shanghai Lufax Information Technology Co., Ltd. (formerly known as Shanghai Lujiazui International Financial Asset Exchange Co., Ltd.) and Shenzhen Lufax Holding Enterprise Management Co., Ltd., and their subsidiaries; |
• | “non-traditional financial service providers” refers to fintech companies, online-only TechFin companies and online lending platforms; |
• | “ordinary shares” refer to our ordinary shares of par value US$0.00001 per share; |
• | “outstanding balance of loans facilitated” refers to the total principal amount outstanding at the end of the given period for loans we facilitated; |
• | “Ping An ecosystem” refers to Ping An Group and its subsidiaries, affiliates and associates, including but not limited to OneConnect Financial Technology Co., Ltd. (NYSE: OCFT), or OneConnect; |
• | “Ping An Group” refers to Ping An Insurance and its subsidiaries; |
• | “Ping An Insurance” refers to Ping An Insurance (Group) Company of China, Ltd.; |
• | “Ping An P&C” refers to Ping An Property & Casualty Insurance Company of China, Ltd.; |
• | “registered users” refer to individuals who have registered on our platform using their mobile phone number, without regard to whether they subsequently engage in any transactions on our platform; |
• | “RMB” and “Renminbi” refer to the legal currency of China; and |
• | “volume of new loans facilitated” refers to the principal amount of new loans we facilitated during the given period. |
• | Our industry is rapidly changing, and our business has evolved significantly in recent years, which makes it difficult to evaluate our future prospects. |
• | A credit crisis or a prolonged downturn in the credit markets may materially and adversely impact our reputation, business, results of operations and financial position. |
• | If the total fees we charge for our retail credit facilitation service are deemed to be in excess of interest rate limits imposed by laws or regulatory bodies, part of the interests and fees may not be valid or enforceable through the PRC judicial system. |
• | The wealth management products displayed on our platform involve various risks, and failure to identify or fully appreciate such risks will negatively affect our reputation, client relationships, operations and prospects. |
• | We may not have access to sufficient and sustainable funding at reasonable costs. |
• | Our business is heavily regulated, and those regulations are complex and rapidly evolving, which makes compliance challenging. |
• | Any failure to obtain, renew or retain requisite approvals, licenses or permits applicable to our business may have a material adverse effect on us. |
• | Even as we modify our business model and practices to remain in compliance with PRC laws and regulations, our legacy products and historical practices may be deemed to violate PRC laws and regulations. |
• | If our credit assessment and risk management model is flawed or ineffective, or if the data that we collect for credit analysis inaccurately reflects the borrower’s creditworthiness, or if we fail or are perceived to fail to effectively manage the default risks of loans facilitated through our platform for any other reason, our business and results of operations may be adversely affected. |
• | Information regarding individuals to whom we provide our financial services may not be complete, and our ability to perform due diligence, detect borrower fraud or manage our risks may be compromised as a result. |
• | We must attempt to collect delinquent loans while not engaging in misconduct or permitting third-party agents to engage in misconduct during the collection progress. |
• | Our business may be materially and adversely affected by the effects of the outbreak of COVID-19 in China. |
• | Our cooperation with various third parties is integral to the smooth operation of our business and platform, but these third parties may fail to perform or provide reliable or satisfactory services. |
• | If we are unable to maintain or increase the amount of loans or investments we facilitate or if we are unable to retain existing borrowers and platform investors, or attract new borrowers or platform investors, our business may decline or fail to grow. |
• | Our principal shareholders have significant influence over our company and their interests may not be aligned with the interests of our other shareholders. |
• | We are a Cayman Islands holding company with no equity ownership in the consolidated affiliated entities and we conduct our operations in China primarily through (i) our subsidiaries in China, (ii) the consolidated affiliated entities with which we have contractual arrangements, and (iii) the subsidiaries of the consolidated affiliated entities. Investors thus are not purchasing direct equity interests in our operating entities in China but instead are purchasing equity interests in a Cayman Islands holding company. If the PRC government finds that the agreements that establish the structure for operating our business do not comply with PRC laws and regulations, or if these regulations or their interpretations change in the future, we could be subject to severe penalties or be forced to relinquish our interests in those operations. Our holding company, our PRC subsidiaries, the consolidated affiliated entities and their subsidiaries, and investors of our company face uncertainty about potential future actions by the PRC government that could affect the enforceability of our contractual arrangements with the consolidated affiliated entities and, consequently, significantly affect the financial performance of the consolidated affiliated entities and our company as a whole. For a detailed description of the risks associated with our corporate structure, please refer to the risks disclosed under “Risk Factors—Risks Relating to Our Corporate Structure.” |
• | The contractual arrangements between our PRC subsidiaries and the consolidated affiliated entities may not be as effective as direct ownership in giving us operational control over our business. |
• | The consolidated affiliated entities or their shareholders may fail to perform their obligations under our contractual arrangements. |
• | The shareholders of the consolidated affiliated entities may have conflicts of interest with us. |
• | PRC laws and regulations are developing and evolving, and PRC judicial and administrative authorities have significant discretion in interpreting and implementing statutory and contractual terms. |
• | The interpretation and application of existing PRC laws, regulations and policies and possible new laws, regulations or policies relating to the internet industry have created substantial uncertainties regarding the legality of existing and future foreign investments in, and the businesses and activities of, internet businesses in China, including our business. |
• | The PRC government’s significant authority in regulating our operations and its oversight and control over offerings conducted overseas by, and foreign investment in, China-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors. Implementation of industry-wide regulations of this nature may cause the value of such securities to significantly decline. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Relating to Doing Business in China—The PRC government’s significant oversight and discretion over our business operations could result in a material adverse change in our operations and the value of our ADSs.” |
• | The approval of and filings with the CSRC or other PRC government authorities may be required in connection with our offshore offerings under PRC law, and, if required, we cannot predict whether we will be able to obtain such approval or complete such filings or how long they might take. |
• | Our ADSs will be prohibited from trading in the United States under the Holding Foreign Companies Accountable Act, or the HFCAA, in 2024 if the PCAOB is unable to inspect or fully investigate auditors located in China, or in 2023 if proposed changes to the law are enacted. The delisting of our ADSs, or the threat of their being delisted, may materially and adversely affect the value of your investment. |
• | The trading price of our ADSs is likely to be volatile. |
• | The sale or availability for sale of substantial amounts of our ADSs, particularly after the expiration of lock-up agreements from our initial public offering beginning on April 28, 2021, could adversely affect their market price. |
• | You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law. |
• | Certain judgments obtained against us by our shareholders may not be enforceable. |
• | our goals and strategies; |
• | our future business development, financial condition and results of operations; |
• | the expected changes in our income, expenses or expenditures; |
• | the expected growth of the retail credit facilitation and wealth management markets; |
• | our expectations regarding demand for and market acceptance of our services; |
• | our expectations regarding our relationship with borrowers, platform investors, funding sources, product providers and other business partners; |
• | competition in our industry; |
• | general economic and business conditions in China and elsewhere; |
• | government policies and regulations relating to our industry; and |
• | the outcome of any current and future legal or administrative proceedings. |
Hypothetical pre-tax earnings in the consolidated affiliated entities(1) |
100.00 | |||
Tax on earnings at statutory rate of 25% at the level of the wholly foreign-owned enterprise, or WFOE (2) |
(25.00 | ) | ||
Net earnings available for distribution |
75.00 | |||
|
|
|||
Withholding tax at standard rate of 10% (3) |
(7.50 | ) | ||
Net distributions to Lufax Holding Ltd/Shareholders |
67.50 | |||
|
|
(1) | For purposes of this example, the tax calculation has been simplified. The hypothetical book pre-tax earnings amount is assumed to equal Chinese taxable income. |
(2) | Certain of our subsidiaries and consolidated affiliated entities qualify for a 15% preferential income tax rate in China. However, such rate is subject to qualification, is temporary in nature, and may not be available in a future period when distributions are paid. For purposes of this hypothetical example, the table above reflects a maximum tax scenario under which the full statutory rate would be effective. |
(3) | The PRC Enterprise Income Tax Law imposes a withholding income tax of 10% on dividends distributed by a foreign invested enterprise to its immediate holding company outside of China. A lower withholding income tax rate of 5% is applied if the foreign invested enterprise’s immediate holding company is a tax resident in Hong Kong, subject to a qualification review at the time of the distribution. For purposes of this hypothetical example, the table above assumes a maximum tax scenario under which the full withholding tax would be applied. |
For the Year Ended December 31, 2021 |
||||||||||||||||||||||||
Lufax Holding Ltd |
Subsidiaries That Are Not Primary Beneficiaries of Consolidated Affiliated Entities |
Primary Beneficiaries of Consolidated Affiliated Entities |
Consolidated Affiliated Entities and Consolidated Affiliated Entities’ Subsidiaries |
Elimination |
Consolidation |
|||||||||||||||||||
(RMB in thousands) |
||||||||||||||||||||||||
Technology platform-based income: |
— | 36,018,357 | 917,668 | 1,358,292 | — | 38,294,317 | ||||||||||||||||||
Retail credit facilitation service fees |
— | 35,990,339 | — | 96,635 | — | 36,086,974 | ||||||||||||||||||
Wealth management transaction and service fees |
— | 28,018 | 917,668 | 1,261,657 | — | 2,207,343 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net interest income |
— | 14,174,231 | — | — | — | 14,174,231 | ||||||||||||||||||
Guarantee income |
— | 4,370,342 | — | — | — | 4,370,342 | ||||||||||||||||||
Other income |
— | 3,860,371 | 5,925 | 9,111 | — | 3,875,407 | ||||||||||||||||||
Investment income |
2,289 | 712,174 | 215,380 | 221,910 | — | 1,151,753 | ||||||||||||||||||
Share of net profits of investments accounted for using the equity method |
— | — | (3,428 | ) | (27,715 | ) | — | (31,143 | ) | |||||||||||||||
Inter-company revenues (1)(3) |
57,717 | 320,693 | 2,442,604 | 5,249 | (2,826,263 | ) | — | |||||||||||||||||
Income (loss) from subsidiaries and consolidated affiliated entities (2) |
18,035,463 | (511,184 | ) | (604,442 | ) | — | (16,919,837 | ) | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total income |
18,095,469 |
58,944,984 |
2,973,707 |
1,566,847 |
(19,746,100 |
) |
61,834,907 |
|||||||||||||||||
Operating expenses |
(113,056 | ) | (26,446,062 | ) | (3,303,952 | ) | (330,914 | ) | — | (30,193,984 | ) | |||||||||||||
Credit impairment losses |
49 | (6,315,341 | ) | (10,901 | ) | (317,534 | ) | — | (6,643,727 | ) | ||||||||||||||
Asset impairment losses |
— | (814,558 | ) | (283,809 | ) | (2,515 | ) | — | (1,100,882 | ) | ||||||||||||||
Finance costs |
(1,380,292 | ) | 360,141 | (90,530 | ) | 115,166 | — | (995,515 | ) | |||||||||||||||
Other gains/(losses) – net |
197,807 | 267,902 | 32,137 | 1,533 | — | 499,379 | ||||||||||||||||||
Inter-company expenses (1)(3) |
6,916 | (1,703,489 | ) | 11,700 | (1,422,021 | ) | 3,106,894 | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total expenses |
(1,288,576 |
) |
(34,651,407 |
) |
(3,645,355 |
) |
(1,956,285 |
) |
3,106,894 |
(38,434,729 |
) | |||||||||||||
Profit before income tax |
16,806,893 |
24,293,577 |
(671,648 |
) |
(389,438 |
) |
(16,639,206 |
) |
23,400,178 |
|||||||||||||||
Less: Income tax expenses |
(2,513 | ) | (6,496,596 | ) | 65,495 | (257,504 | ) | — | (6,691,118 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net profit for the year |
16,804,380 |
17,796,981 |
(606,153 |
) |
(646,942 |
) |
(16,639,206 |
) |
16,709,060 |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net profit/(loss) attributable to: Owners of Lufax Holding Ltd |
16,804,380 | 18,035,463 | (606,153 | ) | (646,942 | ) | (16,782,368 | ) | 16,804,380 | |||||||||||||||
Non-controlling interests |
— | (238,482 | ) | — | — | 143,162 | (95,320 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
16,804,380 |
17,796,981 |
(606,153 |
) |
(646,942 |
) |
(16,639,206 |
) |
16,709,060 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, 2020 |
||||||||||||||||||||||||
Lufax Holding Ltd |
Subsidiaries That Are Not Primary Beneficiaries of Consolidated Affiliated Entities |
Primary Beneficiaries of Consolidated Affiliated Entities |
Consolidated Affiliated Entities and Consolidated Affiliated Entities’ Subsidiaries |
Elimination |
Consolidation |
|||||||||||||||||||
(RMB in thousands) |
||||||||||||||||||||||||
Technology platform-based income: |
— | 39,522,943 | 316,584 | 1,382,315 | — | 41,221,842 | ||||||||||||||||||
Retail credit facilitation service fees |
— | 39,444,729 | — | 12,175 | — | 39,456,904 | ||||||||||||||||||
Wealth management transaction and service fees |
— | 78,214 | 316,584 | 1,370,140 | — | 1,764,938 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net interest income |
— | 7,750,460 | — | — | — | 7,750,460 | ||||||||||||||||||
Guarantee income |
— | 601,644 | — | — | — | 601,644 | ||||||||||||||||||
Other income |
— | 1,510,914 | — | 6,128 | — | 1,517,042 | ||||||||||||||||||
Investment income |
— | 573,389 | 125,069 | 241,441 | — | 939,899 | ||||||||||||||||||
Share of net profits of investments accounted for using the equity method |
— | — | 2,594 | 12,243 | — | 14,837 | ||||||||||||||||||
Inter-company revenues (1)(3) |
113,793 | 185,087 | 783,678 | (70,159 | ) | (1,012,399 | ) | — | ||||||||||||||||
Income (loss) from subsidiaries and consolidated affiliated entities (2) |
15,149,508 | (326,178 | ) | (99,616 | ) | — | (14,723,714 | ) | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total income |
15,263,301 |
49,818,259 |
1,128,309 |
1,571,968 |
(15,736,113 |
) |
52,045,724 |
|||||||||||||||||
Operating expenses |
(91,233 | ) | (26,185,153 | ) | (1,860,502 | ) | (475,591 | ) | — | (28,612,479 | ) | |||||||||||||
Credit impairment losses |
3,555 | (2,988,319 | ) | (2,718 | ) | (47,706 | ) | — | (3,035,188 | ) | ||||||||||||||
Asset impairment losses |
— | (7,168 | ) | — | — | — | (7,168 | ) | ||||||||||||||||
Finance costs |
(2,901,518 | ) | 84,426 | (21,624 | ) | (26,938 | ) | — | (2,865,654 | ) | ||||||||||||||
Other gains/(losses) – net |
75,968 | 298,868 | 16,522 | (7,088 | ) | — | 384,270 | |||||||||||||||||
Inter-company expenses (1)(3) |
4,041 | (587,644 | ) | (30,888 | ) | (1,012,435 | ) | 1,626,926 | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total expenses |
(2,909,187 |
) |
(29,384,990 |
) |
(1,899,210 |
) |
(1,569,758 |
) |
1,626,926 |
(34,136,219 |
) | |||||||||||||
Profit before income tax |
12,354,114 |
20,433,269 |
(770,901 |
) |
2,210 |
(14,109,187 |
) |
17,909,505 |
||||||||||||||||
Less: Income tax expenses |
— | (5,460,047 | ) | (28,892 | ) | (144,326 | ) | — | (5,633,265 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net profit for the year |
12,354,114 |
14,973,222 |
(799,793 |
) |
(142,116 |
) |
(14,109,187 |
) |
12,276,240 |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net profit/(loss) attributable to: Owners of Lufax Holding Ltd |
12,354,114 | 15,149,508 | (799,793 | ) | (142,116 | ) | (14,207,599 | ) | 12,354,114 | |||||||||||||||
Non-controlling interests |
— | (176,286 | ) | — | — | 98,412 | (77,874 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
12,354,114 |
14,973,222 |
(799,793 |
) |
(142,116 |
) |
(14,109,187 |
) |
12,276,240 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, 2019 |
||||||||||||||||||||||||
Lufax Holding Ltd |
Subsidiaries That Are Not Primary Beneficiaries of Consolidated Affiliated Entities |
Primary Beneficiaries of Consolidated Affiliated Entities |
Consolidated Affiliated Entities and Consolidated Affiliated Entities’ Subsidiaries |
Elimination |
Consolidation |
|||||||||||||||||||
(RMB in thousands) |
||||||||||||||||||||||||
Technology platform-based income: |
— | 40,684,851 | 179,279 | 1,064,947 | — | 41,929,077 | ||||||||||||||||||
Retail credit facilitation service fees |
— | 39,324,848 | — | — | — | 39,324,848 | ||||||||||||||||||
Wealth management transaction and service fees |
— | 1,360,003 | 179,279 | 1,064,947 | — | 2,604,229 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net interest income |
— | 3,909,196 | — | — | — | 3,909,196 | ||||||||||||||||||
Guarantee income |
— | 464,743 | — | — | — | 464,743 | ||||||||||||||||||
Other income |
— | 868,827 | — | 10,041 | — | 878,868 | ||||||||||||||||||
Investment income |
— | 582,842 | 77,179 | (80,944 | ) | — | 579,077 | |||||||||||||||||
Share of net profits of investments accounted for using the equity method |
— | — | — | 72,807 | — | 72,807 | ||||||||||||||||||
Inter-company revenues (1)(3) |
183,099 | (1,833,489 | ) | 3,004,425 | 2,497,287 | (3,851,322 | ) | — | ||||||||||||||||
Income (loss) from subsidiaries and consolidated affiliated entities (2) |
14,665,234 | (1,074,752 | ) | (2,360,515 | ) | — | (11,229,967 | ) | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total income |
14,848,333 |
43,602,218 |
900,368 |
3,564,138 |
(15,081,289 |
) |
47,833,768 |
|||||||||||||||||
Operating expenses |
(21,960 | ) | (22,377,263 | ) | (1,804,843 | ) | (1,003,807 | ) | — | (25,207,873 | ) | |||||||||||||
Credit impairment losses |
(3,663 | ) | (797,203 | ) | (16,669 | ) | (1,045,210 | ) | — | (1,862,745 | ) | |||||||||||||
Asset impairment losses |
— | (71,575 | ) | (24 | ) | (62,917 | ) | — | (134,516 | ) | ||||||||||||||
Finance costs |
(1,469,465 | ) | 376,533 | 265 | (427,240 | ) | — | (1,519,907 | ) | |||||||||||||||
Other gains/(losses) – net |
(20,814 | ) | 924,693 | (98,059 | ) | (480,706 | ) | — | 325,114 | |||||||||||||||
Inter-company expenses (1)(3) |
— | (1,517,187 | ) | (37,303 | ) | (3,005,157 | ) | 4,559,647 | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total expenses |
(1,515,902 |
) |
(23,462,002 |
) |
(1,956,633 |
) |
(6,025,037 |
) |
4,559,647 |
(28,399,927 |
) | |||||||||||||
Profit before income tax |
13,332,431 |
20,140,216 |
(1,056,265 |
) |
(2,460,899 |
) |
(10,521,642 |
) |
19,433,841 |
|||||||||||||||
Less: Income tax expenses |
— | (5,490,269 | ) | (513,574 | ) | 57,884 | (170,738 | ) | (6,116,697 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net profit for the year |
13,332,431 |
14,649,947 |
(1,569,839 |
) |
(2,403,015 |
) |
(10,692,380 |
) |
13,317,144 |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net profit/(loss) attributable to: Owners of Lufax Holding Ltd |
13,332,431 | 14,665,234 | (1,569,839 | ) | (2,403,015 | ) | (10,692,380 | ) | 13,332,431 | |||||||||||||||
Non-controlling interests |
— | (15,287 | ) | — | — | — | (15,287 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
13,332,431 |
14,649,947 |
(1,569,839 |
) |
(2,403,015 |
) |
(10,692,380 |
) |
13,317,144 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, 2021 |
||||||||||||||||||||||||
Lufax Holding Ltd |
Subsidiaries That Are Not Primary Beneficiaries of Consolidated Affiliated Entities |
Primary Beneficiaries of Consolidated Affiliated Entities |
Consolidated Affiliated Entities and Consolidated Affiliated Entities’ Subsidiaries |
Elimination |
Consolidation |
|||||||||||||||||||
(RMB in thousands) |
||||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||
Cash at bank |
1,813,616 | 32,000,349 | 24,862 | 904,361 | — | 34,743,188 | ||||||||||||||||||
Restricted cash |
— | 28,752,100 | — | 1,701,439 | — | 30,453,539 | ||||||||||||||||||
Financial assets at fair value through profit or loss |
383,888 | 21,470,668 | 112,163 | 9,056,492 | — | 31,023,211 | ||||||||||||||||||
Financial assets at amortized cost |
— | 1,202,102 | 1,219,883 | 1,362,628 | — | 3,784,613 | ||||||||||||||||||
Accounts and other receivables and contract assets |
991,591 | 18,968,842 | 549,617 | 1,834,723 | — | 22,344,773 | ||||||||||||||||||
Loans to customers |
— | 214,972,110 | — | — | — | 214,972,110 | ||||||||||||||||||
Investments accounted for using the equity method |
— | — | 39,489 | 420,007 | — | 459,496 | ||||||||||||||||||
Investment in subsidiaries and consolidated affiliated entities (2)(6) |
95,872,302 | 9,584,513 | (660,588 | ) | — | (104,796,227 | ) | — | ||||||||||||||||
Assets arising from intra-group transactions (1) |
— | 9,925 | 152,489 | 3,911 | (166,325 | ) | — | |||||||||||||||||
Amounts due from consolidated entities (4) |
12,496,694 | 10,716,718 | 13,353,329 | 535,200 | (37,101,941 | ) | — | |||||||||||||||||
Other assets (5) |
— | 16,383,267 | 366,216 | 5,903,073 | — | 22,652,556 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total assets |
111,558,091 |
354,060,594 |
15,157,460 |
21,721,834 |
(142,064,493 |
) |
360,433,486 |
|||||||||||||||||
LIABILITIES |
||||||||||||||||||||||||
Payable to platform investors |
— | 106,247 | — | 2,641,644 | — | 2,747,891 | ||||||||||||||||||
Borrowings |
319,926 | 22,017,940 | 3,171,769 | 417,782 | — | 25,927,417 | ||||||||||||||||||
Accounts and other payables and contract liabilities |
73,968 | 7,213,233 | 739,400 | 787,654 | — | 8,814,255 | ||||||||||||||||||
Payable to investors of consolidated structured entities |
— | 195,401,380 | — | 44,760 | — | 195,446,140 | ||||||||||||||||||
Convertible promissory note payable |
10,669,498 | — | — | — | — | 10,669,498 | ||||||||||||||||||
Optionally convertible promissory notes |
7,405,103 | — | — | — | — | 7,405,103 | ||||||||||||||||||
Amounts due to consolidated entities (4) |
960 | 16,126,075 | 1,147,772 | 19,827,134 | (37,101,941 | ) | — | |||||||||||||||||
Other liabilities (5) |
34,941 | 13,957,426 | 489,348 | 382,264 | — | 14,863,979 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities |
18,504,396 |
254,822,301 |
5,548,289 |
24,101,238 |
(37,101,941 |
) |
265,874,283 |
|||||||||||||||||
Equity |
||||||||||||||||||||||||
Total equity attributable to owners of the Company (1) |
93,053,695 |
95,872,302 |
9,609,171 |
(2,380,404 |
) |
(103,101,069 |
) |
93,053,695 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Non-controlling interests (6) |
— | 3,365,991 | — | 1,000 | (1,861,483 | ) | 1,505,508 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total equity |
93,053,695 |
99,238,293 |
9,609,171 |
(2,379,404 |
) |
(104,962,552 |
) |
94,559,203 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities and equity |
111,558,091 |
354,060,594 |
15,157,460 |
21,721,834 |
(142,064,493 |
) |
360,433,486 |
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, 2020 |
||||||||||||||||||||||||
Lufax Holding Ltd |
Subsidiaries That Are Not Primary Beneficiaries of Consolidated Affiliated Entities |
Primary Beneficiaries of Consolidated Affiliated Entities |
Consolidated Affiliated Entities and Consolidated Affiliated Entities’ Subsidiaries |
Elimination |
Consolidation |
|||||||||||||||||||
(RMB in thousands) |
||||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||
Cash at bank |
5,909,811 | 15,330,867 | 1,491,832 | 1,426,058 | — | 24,158,568 | ||||||||||||||||||
Restricted cash |
— | 15,189,458 | 32,153 | 7,807,977 | — | 23,029,588 | ||||||||||||||||||
Financial assets at fair value through profit or loss |
— | 16,960,081 | 109 | 17,463,707 | — | 34,423,897 | ||||||||||||||||||
Financial assets at amortized cost |
— | 1,851,560 | 1,676,296 | 3,036,113 | — | 6,563,969 | ||||||||||||||||||
Accounts and other receivables and contract assets |
— | 21,195,246 | 347,924 | 1,782,808 | — | 23,325,978 | ||||||||||||||||||
Loans to customers |
— | 119,825,814 | — | — | — | 119,825,814 | ||||||||||||||||||
Investments accounted for using the equity method |
— | — | 42,918 | 447,013 | — | 489,931 | ||||||||||||||||||
Investment in subsidiaries and consolidated affiliated entities (2)(6) |
77,536,740 | 11,145,929 | 81,401 | — | (88,764,070 | ) | — | |||||||||||||||||
Assets arising from intra-group transactions (1) |
— | (1,037,627 | ) | 194,967 | — | 842,660 | — | |||||||||||||||||
Amounts due from consolidated entities (4) |
16,284,523 | 17,622,230 | 8,676,039 | 564,189 | (43,146,981 | ) | — | |||||||||||||||||
Other assets (5) |
— | 15,375,327 | 569,658 | 1,127,517 | — | 17,072,502 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total assets |
99,731,074 |
233,458,885 |
13,113,297 |
33,655,382 |
(131,068,391 |
) |
248,890,247 |
|||||||||||||||||
LIABILITIES |
||||||||||||||||||||||||
Payable to platform investors |
— | 187,250 | — | 8,927,656 | — | 9,114,906 | ||||||||||||||||||
Borrowings |
355,203 | 9,049,201 | 358,418 | 552,623 | — | 10,315,445 | ||||||||||||||||||
Accounts and other payables and contract liabilities |
167,572 | 4,474,320 | 259,751 | 582,114 | — | 5,483,757 | ||||||||||||||||||
Payable to investors of consolidated structured entities |
— | 110,355,771 | — | 11,947 | — | 110,367,718 | ||||||||||||||||||
Convertible promissory note payable |
10,117,188 | — | — | — | — | 10,117,188 | ||||||||||||||||||
Optionally convertible promissory notes |
7,530,542 | — | — | — | — | 7,530,542 | ||||||||||||||||||
Amounts due to consolidated entities (4) |
761 | 16,296,054 | 1,708,933 | 25,141,233 | (43,146,981 | ) | — | |||||||||||||||||
Other liabilities (5) |
— | 11,965,855 | 667,093 | 176,422 | — | 12,809,370 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities |
18,171,266 |
152,328,451 |
2,994,195 |
35,391,995 |
(43,146,981 |
) |
165,738,926 |
|||||||||||||||||
EQUITY |
||||||||||||||||||||||||
Total equity attributable to owners of the Company (1) |
81,559,808 |
77,536,740 |
10,119,102 |
(1,737,613 |
) |
(85,918,229 |
) |
81,559,808 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Non-controlling interests (6) |
— | 3,593,694 | — | 1,000 | (2,003,181 | ) | 1,591,513 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total equity |
81,559,808 |
81,130,434 |
10,119,102 |
(1,736,613 |
) |
(87,921,410 |
) |
83,151,321 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities and equity |
99,731,074 |
233,458,885 |
13,113,297 |
33,655,382 |
(131,068,391 |
) |
248,890,247 |
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, 2021 |
||||||||||||||||||||||||
Lufax Holding Ltd |
Subsidiaries That Are Not Primary Beneficiaries of Consolidated Affiliated Entities |
Primary Beneficiaries of Consolidated Affiliated Entities |
Consolidated Affiliated Entities and Consolidated Affiliated Entities’ Subsidiaries |
Elimination |
Consolidation |
|||||||||||||||||||
(RMB in thousand) |
||||||||||||||||||||||||
Cash flows from operating activities |
||||||||||||||||||||||||
Inter-company cash flow (3)(7) |
— | 920,254 | (314,385 | ) | 1,369,172 | (1,975,041 | ) | — | ||||||||||||||||
Reclassification (8) |
— | — | — | 327,497 | (327,497 | ) | — | |||||||||||||||||
Other operating activities |
(105,253 | ) | 5,515,423 | 230,532 | (653,230 | ) | — | 4,987,472 | ||||||||||||||||
Net cash (used in)/generated from operating activities |
(105,253 |
) |
6,435,677 |
(83,853 |
) |
1,043,439 |
(2,302,538 |
) |
4,987,472 |
|||||||||||||||
Cash flows from investing activities |
||||||||||||||||||||||||
Inter-company cash flow (7) |
— | (157,536 | ) | (1,085,232 | ) | (735,327 | ) | 1,978,095 | — | |||||||||||||||
Reclassification (8) |
— | — | — | (327,497 | ) | 327,497 | — | |||||||||||||||||
Capital contribution to consolidated entities |
(109,635 | ) | — | — | — | 109,635 | — | |||||||||||||||||
Payment for advances to consolidated entities |
(3,689,678 | ) | (9,474,627 | ) | (2,800,000 | ) | (500,000 | ) | 16,464,305 | — | ||||||||||||||
Receipts of repayments of the advances from consolidated entities |
7,249,502 | 16,407,898 | 706,741 | 1,064,669 | (25,428,810 | ) | — | |||||||||||||||||
Proceeds from sale of investment assets |
6,522 | 111,524,589 | 1,720,840 | 20,633,784 | — | 133,885,735 | ||||||||||||||||||
Payment for acquisition of investment assets |
(383,798 | ) | (116,771,357 | ) | (1,996,000 | ) | (9,440,542 | ) | — | (128,591,697 | ) | |||||||||||||
Other investing activities |
— | (130,716 | ) | (22,656 | ) | (4,826,844 | ) | — | (4,980,216 | ) | ||||||||||||||
Net cash generated from/(used in) investing activities |
3,072,913 |
1,398,251 |
(3,476,307 |
) |
5,868,243 |
(6,549,278 |
) |
313,822 |
||||||||||||||||
Cash flows from financing activities |
||||||||||||||||||||||||
Inter-company cash flow (7) |
— | — | 3,054 | — | (3,054 | ) | — | |||||||||||||||||
Capital contribution from consolidated entities |
— | 109,635 | — | — | (109,635 | ) | — | |||||||||||||||||
Repayment for advances to consolidated entities |
— | (7,222,326 | ) | (1,092,472 | ) | (17,114,012 | ) | 25,428,810 | — | |||||||||||||||
Receipts of advances from consolidated entities |
— | 6,190,304 | 500,000 | 9,774,001 | (16,464,305 | ) | — | |||||||||||||||||
Proceeds from issuance of shares and other equity securities |
— | 22,333 | — | — | — | 22,333 | ||||||||||||||||||
Proceeds from exercise of share-based payment |
43,456 | — | — | — | — | 43,456 | ||||||||||||||||||
Proceeds from borrowings |
319,535 | 3,197,000 | 3,173,900 | 572,000 | — | 7,262,435 | ||||||||||||||||||
Repayment of interest expenses and borrowings |
(925,233 | ) | (635,029 | ) | (444,760 | ) | (664,880 | ) | — | (2,669,902 | ) | |||||||||||||
Payment for repurchase of ordinary shares |
(6,438,455 | ) | — | — | — | — | (6,438,455 | ) | ||||||||||||||||
Other financing activities |
(1,131 | ) | (619,797 | ) | (46,493 | ) | (474 | ) | — | (667,895 | ) | |||||||||||||
Net cash (used in)/generated from financing activities |
(7,001,828 |
) |
1,042,120 |
2,093,229 |
(7,433,365 |
) |
8,851,816 |
(2,448,028 |
) |
For the Year Ended December 31, 2020 |
||||||||||||||||||||||||
Lufax Holding Ltd |
Subsidiaries That Are Not Primary Beneficiaries of Consolidated Affiliated Entities |
Primary Beneficiaries of Consolidated Affiliated Entities |
Consolidated Affiliated Entities and Consolidated Affiliated Entities’ Subsidiaries |
Elimination |
Consolidation |
|||||||||||||||||||
(RMB in thousand) |
||||||||||||||||||||||||
Cash flows from operating activities |
||||||||||||||||||||||||
Inter-company cash flow (3)(7) |
— | (809,615 | ) | 1,133,480 | (1,151,110 | ) | 827,245 | — | ||||||||||||||||
Other operating activities |
(98,869 | ) | 8,687,386 | (3,302,903 | ) | 1,835,668 | — | 7,121,282 | ||||||||||||||||
Net cash (used in)/generated from operating activities |
(98,869 |
) |
7,877,771 |
(2,169,423 |
) |
684,558 |
827,245 |
7,121,282 |
||||||||||||||||
Cash flows from investing activities |
||||||||||||||||||||||||
Inter-company cash flow (7) |
— | 124,906 | 201,154 | 501,185 | (827,245 | ) | — | |||||||||||||||||
Capital contribution to consolidated entities |
(1,898,193 | ) | (1,788,549 | ) | — | — | 3,686,742 | — | ||||||||||||||||
Payment for advances to consolidated entities |
(9,456,072 | ) | (17,182,316 | ) | (80,000 | ) | (240,000 | ) | 26,958,388 | — | ||||||||||||||
Receipts of repayments of the advances from consolidated entities |
2,374,680 | 5,560,388 | 1,254,800 | 4,813,732 | (14,003,600 | ) | — | |||||||||||||||||
Proceeds from sale of investment assets |
1,875 | 130,041,066 | 5,978,563 | 16,449,825 | — | 152,471,329 | ||||||||||||||||||
Payment for acquisition of investment assets |
— | (133,050,666 | ) | (5,078,510 | ) | (28,402,132 | ) | — | (166,531,308 | ) | ||||||||||||||
Other investing activities |
— | (160,782 | ) | (85,673 | ) | (697,316 | ) | — | (943,771 | ) | ||||||||||||||
Net cash generated from/(used in) investing activities |
(8,977,710 |
) |
(16,455,953 |
) |
2,190,334 |
(7,574,706 |
) |
15,814,285 |
(15,003,750 |
) | ||||||||||||||
Cash flows from financing activities |
||||||||||||||||||||||||
Capital contribution from consolidated entities |
— | 1,897,472 | 1,789,270 | — | (3,686,742 | ) | — | |||||||||||||||||
Repayment for advances to consolidated entities |
— | (3,514,357 | ) | (1,457,697 | ) | (9,031,546 | ) | 14,003,600 | — | |||||||||||||||
Receipts of advances from consolidated entities |
— | 9,696,073 | 1,166,275 | 16,096,040 | (26,958,388 | ) | — | |||||||||||||||||
Proceeds from issuance of shares and other equity securities |
17,343,739 | 1,564,253 | — | — | — | 18,907,992 | ||||||||||||||||||
Proceeds from borrowings |
— | 9,594,528 | 463,909 | 531,162 | — | 10,589,599 | ||||||||||||||||||
Repayment of interest expenses and borrowings |
(2,162,653 | ) | (713,149 | ) | (875,332 | ) | (275,959 | ) | — | (4,027,093 | ) | |||||||||||||
Other financing activities |
(4,745 | ) | (591,830 | ) | — | — | — | (596,575 | ) | |||||||||||||||
Net cash (used in)/generated from financing activities |
15,176,341 |
17,932,990 |
1,086,425 |
7,319,697 |
(16,641,530 |
) |
24,873,923 |
For the Year Ended December 31, 2019 |
||||||||||||||||||||||||
Lufax Holding Ltd |
Subsidiaries That Are Not Primary Beneficiaries of Consolidated Affiliated Entities |
Primary Beneficiaries of Consolidated Affiliated Entities |
Consolidated Affiliated Entities and Consolidated Affiliated Entities’ Subsidiaries |
Elimination |
Consolidation |
|||||||||||||||||||
(RMB in thousands) |
||||||||||||||||||||||||
Cash flows from operating activities |
||||||||||||||||||||||||
Inter-company cash flow (3)(7) |
— | (2,320,700 | ) | 4,865,008 | (5,639,240 | ) | 3,094,932 | — | ||||||||||||||||
Other operating activities |
(28,986 | ) | 4,301,036 | (7,365,302 | ) | 5,285,146 | — | 2,191,894 | ||||||||||||||||
Net cash (used in)/generated from operating activities |
(28,986 |
) |
1,980,336 |
(2,500,294 |
) |
(354,094 |
) |
3,094,932 |
2,191,894 |
|||||||||||||||
Cash flows from investing activities |
||||||||||||||||||||||||
Inter-company cash flow (7) |
— | 2,746,666 | 348,266 | — | (3,094,932 | ) | — | |||||||||||||||||
Capital contribution to consolidated entities |
(1,839,399 | ) | (3,471,124 | ) | — | — | 5,310,523 | — | ||||||||||||||||
Payment for advances to consolidated entities |
(5,754,349 | ) | (5,810,045 | ) | (5,572,771 | ) | (4,274,611 | ) | 21,411,776 | — | ||||||||||||||
Receipts of repayments of the advances from consolidated entities |
4,969,062 | 762,754 | 2,966,315 | 3,019 | (8,701,150 | ) | — | |||||||||||||||||
Proceeds from sale of investment assets |
911 | 87,132,664 | 7,595,963 | 24,720,312 | — | 119,449,850 | ||||||||||||||||||
Payment for acquisition of investment assets |
(2,345 | ) | (91,703,392 | ) | (8,415,000 | ) | (28,449,798 | ) | — | (128,570,535 | ) | |||||||||||||
Other investing activities |
— | (1,847,516 | ) | (44,099 | ) | (1,211 | ) | — | (1,892,826 | ) | ||||||||||||||
Net cash generated from/(used in) investing activities |
(2,626,120 |
) |
(12,189,993 |
) |
(3,121,326 |
) |
(8,002,289 |
) |
14,926,217 |
(11,013,511 |
) | |||||||||||||
Cash flows from financing activities |
||||||||||||||||||||||||
Capital contribution from consolidated entities |
— | 1,839,399 | 3,471,124 | — | (5,310,523 | ) | — | |||||||||||||||||
Repayment for advances to consolidated entities |
— | (6,246,130 | ) | (3,136 | ) | (2,451,884 | ) | 8,701,150 | — | |||||||||||||||
Receipts of advances from consolidated entities |
— | 8,441,111 | 1,418,000 | 11,552,665 | (21,411,776 | ) | — | |||||||||||||||||
Proceeds from issuance of shares and other equity securities |
542,903 | 127,880 | 6,990 | — | — | 677,773 | ||||||||||||||||||
Proceeds from borrowings |
1,410,660 | 2,017,449 | 808,900 | 255,257 | — | 4,492,266 | ||||||||||||||||||
Repayment of interest expenses and borrowings |
(99,265 | ) | (5,894,890 | ) | (261,990 | ) | (953,384 | ) | — | (7,209,529 | ) | |||||||||||||
Other financing activities |
(50,072 | ) | (491,321 | ) | (19,373 | ) | (11,869 | ) | — | (572,635 | ) | |||||||||||||
Net cash (used in)/generated from financing activities |
1,804,226 |
(206,502 |
) |
5,420,515 |
8,390,785 |
(18,021,149 |
) |
(2,612,125 |
) |
(1) | This represents the elimination of intercompany transactions among Lufax Holding Ltd, subsidiaries that are not primary beneficiaries of consolidated affiliated entities, the primary beneficiaries of consolidated affiliated entities, and consolidated affiliated entities and consolidated affiliated entities’ subsidiaries, including the elimination of the unrealized profit from inter-company platform service provided and inter-company transfer of assets. |
(2) | This represents the elimination of the investment among Lufax Holding Ltd, subsidiaries that are not the primary beneficiaries of consolidated affiliated entities, the primary beneficiaries of consolidated affiliated entities, and consolidated affiliated entities and consolidated affiliated entities’ subsidiaries. |
(3) | Intercompany revenues between consolidated affiliated entities and consolidated affiliated entities’ subsidiaries and the primary beneficiaries of consolidated affiliated entities. |
(4) | This represents the elimination of intercompany balances among Lufax Holding Ltd, subsidiaries that are not primary beneficiaries of consolidated affiliated entities, the primary beneficiaries of consolidated affiliated entities, and consolidated affiliated entities and consolidated affiliated entities’ subsidiaries. |
(5) | This represents other total immaterial assets or liabilities of each component. |
(6) | In April 2020, one subsidiary of Lufax Holding Ltd included in the “subsidiaries that are not primary beneficiaries of consolidated affiliated entities” column in the above schedules, two subsidiaries included as “primary beneficiaries of consolidated affiliated entities”, and Ping An Group entered into a joint investment of the establishment of Ping An Consumer Finance Co., Ltd., or Consumer Finance. After the investment, our company as a whole was able to control Consumer Finance. The shareholding ratio between the subsidiary included in the “subsidiaries that are not primary beneficiaries of consolidated affiliated entities” column and the other two subsidiaries included as “primary beneficiaries of consolidated affiliated entities” was 28%, 27% and 15% as of December 31, 2021. In this consolidated affiliated entity consolidating schedule, Consumer Finance’s financial information was recorded in the “subsidiaries that are not primary beneficiaries of consolidated affiliated entities” column. The three subsidiaries applied equity method in accounting for their investments in Consumer Finance. Each of the three subsidiaries has significant influence but not control over Consumer Finance. Total assets for Consumer Finance was RMB5,188.6 million and RMB18,484.7 million as of December 31, 2020 and 2021. Total liabilities for Consumer Finance was RMB419.1 million and RMB14,052.6 million as of December 31, 2020 and 2021. Investments in Consumer Finance included in “primary beneficiaries of consolidated affiliated entities” was RMB 2,003 million and RMB 1,861 million as of December 31, 2020 and 2021. |
(7) | This represents the elimination of intercompany transactions, besides capital contribution, loans and borrowings among subsidiaries that are not primary beneficiaries of consolidated affiliated entities, the primary beneficiaries of consolidated affiliated entities, consolidated affiliated entities and consolidated affiliated entities’ subsidiaries, including offsetting the cash flows for intra-group centralized cash management activities. For the subsidiary of consolidated affiliate entity that purely operates the centralized cash management function, the relevant cash flows were recorded as operating activities while for other subsidiaries or consolidated affiliated entities that participate in the cash management function, the relevant cash flows were recognized as investment or financing activities. |
(8) | This represents the reclassification of certain cash flows that were considered as investing activities in the financial statements of consolidated affiliated entities and consolidated affiliated entities’ subsidiaries and as operating activities in the consolidated financial statements. |
A. |
Selected Financial Data |
For the Year Ended December 31, |
||||||||||||||||||||||||
2017 |
2018 |
2019 |
2020 |
2021 |
||||||||||||||||||||
RMB |
RMB |
RMB |
RMB |
RMB |
US$ |
|||||||||||||||||||
(in millions) | ||||||||||||||||||||||||
Technology platform-based income: |
||||||||||||||||||||||||
Retail credit facilitation service fees |
15,336 | 29,576 | 39,325 | 39,457 | 36,087 | 5,663 | ||||||||||||||||||
Wealth management transaction and service fees |
1,885 | 2,645 | 2,604 | 1,765 | 2,207 | 346 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total technology platform-based income |
17,221 | 32,221 | 41,929 | 41,222 | 38,294 | 6,009 | ||||||||||||||||||
Net interest income |
7,256 | 5,894 | 3,909 | 7,750 | 14,174 | 2,224 | ||||||||||||||||||
Guarantee income |
1,456 | 814 | 465 | 602 | 4,370 | 686 | ||||||||||||||||||
Other income |
810 | 508 | 879 | 1,517 | 3,875 | 608 | ||||||||||||||||||
Investment income |
1,060 | 1,017 | 579 | 940 | 1,152 | 181 | ||||||||||||||||||
Share of net profits of investments accounted for using the equity method |
16 | 46 | 73 | 15 | (31 | ) | (5 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total income |
27,819 |
40,500 |
47,834 |
52,046 |
61,835 |
9,703 |
||||||||||||||||||
Sales and marketing expenses |
(7,451 | ) | (10,767 | ) | (14,931 | ) | (17,814 | ) | (17,993 | ) | (2,823 | ) | ||||||||||||
General and administrative expenses |
(2,823 | ) | (2,796 | ) | (2,853 | ) | (2,976 | ) | (3,559 | ) | (558 | ) | ||||||||||||
Operation and servicing expenses |
(3,072 | ) | (4,367 | ) | (5,471 | ) | (6,031 | ) | (6,558 | ) | (1,029 | ) | ||||||||||||
Technology and analytics expenses |
(1,302 | ) | (1,659 | ) | (1,952 | ) | (1,792 | ) | (2,084 | ) | (327 | ) | ||||||||||||
Credit impairment losses |
N/A | * |
(935 | ) | (1,863 | ) | (3,035 | ) | (6,644 | ) | (1,043 | ) | ||||||||||||
Asset impairment losses |
(3,736 | ) | (7 | ) | (135 | ) | (7 | ) | (1,101 | ) | (173 | ) | ||||||||||||
Finance costs |
(1,297 | ) | (900 | ) | (1,520 | ) | (2,866 | ) | (996 | ) | (156 | ) | ||||||||||||
Other gains/(losses) – net |
225 | (420 | ) | 325 | 384 | 499 | 78 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total expenses |
(19,455 |
) |
(21,850 |
) |
(28,400 |
) |
(34,136 |
) |
(38,435 |
) |
(6,031 |
) | ||||||||||||
Profit before income tax |
8,364 |
18,649 |
19,434 |
17,910 |
23,400 |
3,672 |
||||||||||||||||||
Less: Income tax expenses |
(2,337 | ) | (5,073 | ) | (6,117 | ) | (5,633 | ) | (6,691 | ) | (1,050 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net profit |
6,027 |
13,576 |
13,317 |
12,276 |
16,709 |
2,622 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Note: The line item for credit impairment losses is not applicable in 2017 as a result of the adoption of IFRS 9. |
As of December 31, |
||||||||||||||||||||||||
2017 |
2018 |
2019 |
2020 |
2021 |
||||||||||||||||||||
RMB |
RMB |
RMB |
RMB |
RMB |
US$ |
|||||||||||||||||||
(in millions) | ||||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||
Cash at bank |
18,713 | 18,576 | 7,352 | 24,159 | 34,743 | 5,452 | ||||||||||||||||||
Restricted cash |
6,558 | 7,937 | 24,603 | 23,030 | 30,454 | 4,779 | ||||||||||||||||||
Financial assets at fair value through profit or loss |
12,442 | 16,444 | 18,583 | 34,424 | 31,023 | 4,868 | ||||||||||||||||||
Financial assets at amortized cost |
N/A | * |
3,108 | 8,623 | 6,564 | 3,785 | 594 | |||||||||||||||||
Accounts and other receivables and contract assets |
18,467 | 20,095 | 26,296 | 23,326 | 22,345 | 3,506 | ||||||||||||||||||
Loans to customers |
97,553 | 34,428 | 47,499 | 119,826 | 214,972 | 33,734 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total assets |
180,358 |
117,919 |
149,534 |
248,890 |
360,433 |
56,560 |
||||||||||||||||||
LIABILITIES |
||||||||||||||||||||||||
Payable to platform investors |
10,212 | 9,820 | 15,344 | 9,115 | 2,748 | 431 | ||||||||||||||||||
Payable to investors of consolidated structured entities |
114,728 | 31,810 | 47,243 | 110,368 | 195,446 | 30,670 | ||||||||||||||||||
Accounts and other payables and contract liabilities |
3,756 | 6,244 | 4,826 | 5,484 | 8,814 | 1,383 | ||||||||||||||||||
Convertible redeemable preferred shares |
— | 8,935 | 10,259 | — | — | — | ||||||||||||||||||
Optionally convertible promissory note |
— | — | — | 7,531 | 7,405 | 1,162 | ||||||||||||||||||
Convertible promissory note payable |
8,071 | 9,135 | 10,014 | 10,117 | 10,669 | 1,674 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities |
159,122 |
82,971 |
101,388 |
165,739 |
265,874 |
41,721 |
||||||||||||||||||
Share premium |
10,870 | 14,113 | 14,113 | 33,213 | 33,366 | 5,236 | ||||||||||||||||||
Retained earnings |
2,677 | 16,237 | 29,346 | 40,928 | 55,943 | 8,779 | ||||||||||||||||||
Other reserves |
7,120 | 4,579 | 4,582 | 7,419 | 9,305 | 1,460 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total equity |
21,236 |
34,948 |
48,145 |
83,151 |
94,559 |
14,838 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Note: The line item for financial assets at amortized cost is not applicable in 2017 as a result of the adoption of IFRS 9. |
For the Year Ended December 31, |
||||||||||||||||||||||||
2017 |
2018 |
2019 |
2020 |
2021 |
||||||||||||||||||||
RMB |
RMB |
RMB |
RMB |
RMB |
US$ |
|||||||||||||||||||
(in millions) | ||||||||||||||||||||||||
Selected Consolidated Cash Flows Data: |
||||||||||||||||||||||||
Net cash generated from/(used in) in operating activities |
2,675 | (1,452 | ) | 2,192 | 7,121 | 4,987 | 783 | |||||||||||||||||
Net cash (used in)/generated from investing activities |
(1,630 | ) | 3,494 | (11,014 | ) | (15,004 | ) | 314 | 49 | |||||||||||||||
Net cash generated from/(used in) financing activities |
6,505 | (2,008 | ) | (2,612 | ) | 24,874 | (2,448 | ) | (384 | ) | ||||||||||||||
Effect of exchange rate changes on cash and cash equivalents |
(47 | ) | (86 | ) | 170 | (518 | ) | (143 | ) | (22 | ) | |||||||||||||
Net increase/(decrease) in cash and cash equivalents |
7,503 | (52 | ) | (11,264 | ) | 16,474 | 2,711 | 425 | ||||||||||||||||
Cash and cash equivalents at beginning of the year |
11,125 | 18,628 | 18,576 | 7,312 | 23,786 | 3,733 | ||||||||||||||||||
Cash and cash equivalents at end of the year |
18,628 | 18,576 | 7,312 | 23,786 | 26,496 | 4,158 |
As of and For the Years Ended December 31, |
||||||||||||||||||||
2017 |
2018 |
2019 |
2020 |
2021 |
||||||||||||||||
Retail Credit Facilitation |
||||||||||||||||||||
Number of cumulative borrowers (millions) |
7.5 | 10.3 | 12.4 | 14.5 | 16.8 | |||||||||||||||
Outstanding balance of loans facilitated (RMB billions) |
288.4 | 375.0 | 462.2 | 545.1 | 661.0 | |||||||||||||||
Percentage without credit risk exposure |
75.4 | % | 94.7 | % | 97.8 | % | 93.7 | % | 83.4 | % | ||||||||||
Percentage with credit risk exposure |
24.6 | % | 5.3 | % | 2.2 | % | 6.3 | % | 16.6 | % | ||||||||||
Volume of new loans facilitated (RMB billions) |
343.8 | 397.0 | 493.7 | 565.0 | 648.4 | |||||||||||||||
Percentage funded by third parties |
51.8 | % | 96.8 | % | 99.8 | % | 98.4 | % | 96.1 | % | ||||||||||
Percentage funded by us |
48.2 | % | 3.2 | % | 0.2 | % | 1.6 | % | 3.9 | % | ||||||||||
Wealth Management |
||||||||||||||||||||
Number of registered users (millions) |
33.8 | 40.4 | 44.0 | 46.2 | 51.6 | |||||||||||||||
Number of active investors (millions) |
9.6 | 11.2 | 12.5 | 14.9 | 15.5 | |||||||||||||||
Total client assets (RMB billions) |
461.7 | 369.4 | 346.9 | 426.6 | 432.7 | |||||||||||||||
Current products |
27.1 | % | 49.4 | % | 70.2 | % | 95.5 | % | 100.0 | % | ||||||||||
Legacy products |
72.9 | % | 50.6 | % | 29.8 | % | 4.5 | % | — |
B. |
Capitalization and Indebtedness |
C. |
Reasons for the Offer and Use of Proceeds |
• | attract, retain and develop active users for our platform and apps; |
• | navigate a complex and evolving regulatory environment; |
• | continue to develop, maintain and scale our platform and sustain our historical growth rates; |
• | convince prospective customers, users and partners of the value of products and services on our platform; |
• | increase our market share and offer personalized and competitive services; |
• | offer or maintain attractive fees while driving the growth and profitability of our business; |
• | develop sufficient, diversified, sustainable, cost-efficient and reputable institutional funding sources; |
• | continue to develop and improve the effectiveness, accuracy and efficiency of our proprietary credit assessment and risk management technology; |
• | improve our operational efficiency and maintain profitability; |
• | enhance our technology infrastructure to support the growth of our business, maintain the security of our system and the confidentiality of the information provided and utilized across our system; |
• | effectively maintain, upgrade and scale our financial and risk management controls and procedures; |
• | defend ourselves against legal proceedings and regulatory actions, such as claims against us relating to our sales and collection efforts, fee structures, employee and third-party misconduct, intellectual property, cybersecurity or privacy; |
• | operate without being adversely affected by negative publicity about our industry in general and our company in particular, including baseless or ill-intentioned negative publicity; and |
• | navigate fluctuations in economic conditions. |
• | our brand recognition and reputation; |
• | the cost the borrowers and product providers bear; |
• | the return rates offered to funding partners or platform investors relative to market rates; |
• | the financing service fees charged; |
• | our efficiency in acquiring and engaging prospective borrowers; |
• | our ability to convert registered users to active borrowers and platform investors; |
• | utilization of the credit we approve; |
• | the effectiveness of our credit assessment model and risk management system; |
• | our ability to secure sufficient and cost-efficient funding, borrowers’ experience on our platform; and |
• | the PRC regulatory environment governing our industry and the macroeconomic environment. |
• | users may not find the terms of retail credit products or selection of wealth management products available on our platform competitive or appealing; |
• | we may fail to predict market demand accurately and provide products and services that meet this demand in a timely fashion; |
• | borrowers, platform investors, funding partners and product providers using our platforms may not like, find useful or agree with the changes we adopt from time to time; |
• | there may be defects, errors or failures on our platforms; |
• | there may be negative publicity, including baseless or ill-intentioned negative publicity, about the products or services available on our platform, or our platform’s performance or effectiveness; and |
• | regulations or rules applicable to us may constrain our operations and growth. |
• | engaging in misrepresentation or fraudulent activities when marketing or performing our services to users and clients; |
• | improperly acquiring, using or disclosing confidential information of our users and clients or other parties; |
• | failing to report conflicts of interest accurately or timely; |
• | concealing unauthorized or unsuccessful illegal activities; or |
• | otherwise not complying with applicable laws and regulations or our internal policies or procedures. |
• | challenges associated with relying on local partners in markets that are not as familiar to us, including local joint venture partners to help us establish our business; |
• | the burden of compliance with additional regulations and government authorities in a highly regulated industry; |
• | potentially adverse tax consequences from operating in multiple jurisdictions; |
• | complexities and difficulties in obtaining protection and enforcing our intellectual property in multiple jurisdictions; |
• | increased demands on our management’s time and attention to deal with potentially unique issues arising from local circumstances; and |
• | general economic and political conditions internationally. |
• | our estimate of market demand may not be accurate so that we may not be able to launch products and services that align with and meet specific market demand, or there may not be sufficient market demand for our new business operations; |
• | changes on our platform, including the introduction of new platform services and mobile application functions, may not be favorably accepted by existing users; |
• | we may fail to properly assess creditworthiness of new borrowers, or accurately price new loan products; |
• | negative publicity or news about our existing products and services may dissuade customers from trying new products and services; |
• | we may experience delays in launching the new business operations or loan and investment products or services; and |
• | our competitors may offer products and services that are more attractive. |
• | difficulties in assimilating and integrating the operation, personnel, systems, data, technologies, products and services of the acquired business; |
• | inability of the acquired technologies, products or businesses to achieve expected levels of income, profitability, productivity or other benefits; |
• | difficulties in retaining, training, motivating and integrating key personnel; |
• | diversion of management’s time and resources from our normal daily operations and potential disruptions to our ongoing business; |
• | difficulties in successfully incorporating licensed or acquired technology and rights into our platform; |
• | difficulties in maintaining uniform standards, controls, procedures and policies within the combined organization; |
• | difficulties in retaining relationships with customers, employees and suppliers of the acquired business; |
• | risks of entering markets in which we have limited or no prior experience; |
• | regulatory risks, including remaining in good standing with existing regulatory bodies or being subject to new regulators with oversight over an acquired business; |
• | assumption of contractual obligations that contain terms that are not beneficial to us; |
• | liability for activities of the acquired business before the acquisition, including intellectual property infringement claims, violations of laws, commercial disputes, tax liabilities, labor disputes, regulatory actions and penalties and other known and unknown liabilities; and |
• | unexpected costs and unknown risks and liabilities associated with strategic investments or acquisitions. Our quarterly results may fluctuate significantly and may not fully reflect the underlying performance of our business. |
• | revoking the business licenses and/or operating licenses of such entities; |
• | imposing fines on us; |
• | confiscating any of our income that they deem to be obtained through illegal operations; |
• | discontinuing or placing restrictions or onerous conditions on our operations; |
• | placing restrictions on our right to collect income; |
• | shutting down our servers or blocking our app/websites; |
• | requiring us to restructure our ownership structure or operations; |
• | restricting or prohibiting our use of the proceeds from our initial public offering or other of our financing activities to finance the business and operations of the consolidated affiliated entities and their subsidiaries; |
• | imposing conditions or requirements with which we may not be able to comply; or |
• | taking other regulatory or enforcement actions that could be harmful to our business. |
• | variations in our income, earnings and cash flow; |
• | announcements of new investments, acquisitions, strategic partnerships or joint ventures by us or our competitors; |
• | announcements of new services and expansions by us or our competitors; |
• | changes in financial estimates by securities analysts; |
• | detrimental adverse publicity about us, our services or our industry; |
• | additions or departures of key personnel; |
• | expiration or release of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; |
• | changes in relations between the United States and China; and |
• | potential litigation or regulatory investigations. |
• | the rules under the Exchange Act requiring the filing of quarterly reports on Form 10-Q or current reports on Form 8-K with the SEC; |
• | the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; |
• | the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and |
• | the selective disclosure rules by issuers of material nonpublic information under Regulation FD. |
• | we have failed to timely provide the depositary with notice of the meeting and related voting materials; |
• | we have instructed the depositary that we do not wish a discretionary proxy to be given; |
• | we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting; |
• | we have informed the depositary that a matter to be voted on at the meeting may have an adverse impact on shareholders; or |
• | the voting at the meeting is to be made on a show of hands. |
General Unsecured Loans |
Secured Loans | |||||
Typical Borrower Profile | • Small business owners |
• Salaried workers |
• Small business owners | |||
Use of Proceeds | • Small business operations |
• Personal consumption |
• Small business operations | |||
Credit Risk Assessment | • Individual, business |
• Individual |
• Individual, business, collateral | |||
Average Ticket Size | • RMB215,810 (US$33,865) |
• RMB165,613 (US$25,988) |
• RMB430,795 (US$67,601) | |||
Average Contractual Tenor | • 35.5 months |
• 35.3 months |
• 35.9 months | |||
APR | • 22.2% |
• 23.6% |
• 16.2% | |||
Repayment Schedule | • Fixed installments |
• Fixed installments |
• Fixed installments or balloon payment |
As of December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB millions) |
(%) | (RMB millions) |
(%) | (RMB millions) |
(%) | |||||||||||||||||||
Outstanding Balance of Loans Facilitated |
||||||||||||||||||||||||
Current products: |
||||||||||||||||||||||||
General unsecured loans |
366,486 | 79.3 | 447,466 | 82.1 | 520,091 | 78.7 | ||||||||||||||||||
Secured loans |
88,599 | 19.2 | 93,737 | 17.2 | 129,307 | 19.6 | ||||||||||||||||||
Consumer finance loans |
— | — | 3,580 | 0.7 | 11,630 | 1.8 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total current products |
455,085 | 98.5 | 544,783 | 99.9 | 661,027 | 100.0 | ||||||||||||||||||
Legacy unsecured loans |
7,158 | 1.5 | 367 | 0.1 | 2 | 0.0 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
462,243 |
100.0 |
545,150 |
100.0 |
661,029 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(%) | ||||||||||||
Fixed installments |
94.3 | 91.0 | 90.1 | |||||||||
Balloon payments |
5.7 | 9.0 | 9.9 | |||||||||
|
|
|
|
|
|
|||||||
Total |
100.0 |
100.0 |
100.0 |
|||||||||
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB millions) |
(%) | (RMB millions) |
(%) | (RMB millions) |
(%) | |||||||||||||||||||
Volume of New Loans Facilitated |
||||||||||||||||||||||||
Current products: |
||||||||||||||||||||||||
General unsecured loans |
375,343 | 76.0 | 436,137 | 77.2 | 481,663 | 74.3 | ||||||||||||||||||
Secured loans |
117,312 | 23.8 | 122,320 | 21.7 | 141,463 | 21.8 | ||||||||||||||||||
Consumer finance loans |
— | — | 6,506 | 1.2 | 25,278 | 3.9 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total current products |
492,656 | 99.8 | 564,963 | 100.0 | 648,404 | 100.0 | ||||||||||||||||||
Legacy unsecured loans |
1,068 | 0.2 | — | — | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
493,723 |
100.0 |
564,963 |
100.0 |
648,404 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB) | ||||||||||||
Average Ticket Size |
||||||||||||
General unsecured loans |
141,070 | 164,483 | 199,502 | |||||||||
Secured loans |
486,611 | 390,467 | 430,795 |
For the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(months) | ||||||||||||
Average Contractual Tenor |
||||||||||||
General unsecured loans |
35.2 | 35.3 | 35.4 | |||||||||
Secured loans |
35.9 | 36.0 | 35.9 |
Vintage |
Loan Principal at Origination |
Early Repayment Amount |
||||||||||||||
For the Year Ended December 31, |
||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||
(RMB millions) |
||||||||||||||||
Before 2017 |
— | 1,979 | — | — | ||||||||||||
2017 |
279,462 | 19,493 | 2,353 | — | ||||||||||||
2018 |
326,843 | 75,470 | 24,728 | 2,811 | ||||||||||||
2019 |
492,656 | 89,026 | 123,599 | 33,115 | ||||||||||||
2020 |
558,457 | — | 83,233 | 130,637 | ||||||||||||
|
|
|
|
|
|
|||||||||||
2021 |
623,126 | — | — | 71,584 | ||||||||||||
|
|
|
|
|
|
|||||||||||
Total |
122,406 |
185,968 |
238,147 |
|||||||||||||
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(%) |
||||||||||||
APR |
||||||||||||
General unsecured loans |
29.0 | 26.7 | 22.6 | |||||||||
Secured loans |
18.7 | 17.4 | 16.2 |
For the Year Ended December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB millions) |
(%) |
(RMB millions) |
(%) |
(RMB millions) |
(%) |
|||||||||||||||||||
Ticket Size |
||||||||||||||||||||||||
Up to RMB50,000 |
17,549 | 4.7 | 12,913 | 3.0 | 7,177 | 1.5 | ||||||||||||||||||
RMB50,001 to RMB100,000 |
65,390 | 17.4 | 57,673 | 13.2 | 38,494 | 8.0 | ||||||||||||||||||
RMB100,001 to RMB200,000 |
147,875 | 39.4 | 146,153 | 33.5 | 137,963 | 28.6 | ||||||||||||||||||
RMB200,001 to RMB300,000 |
114,239 | 30.4 | 131,391 | 30.1 | 159,210 | 33.1 | ||||||||||||||||||
RMB300,001 or above |
30,291 | 8.1 | 88,008 | 20.2 | 138,818 | 28.8 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
375,343 |
100.0 |
436,137 |
100.0 |
481,663 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(%) |
(RMB billions) |
(%) |
(RMB billions) |
(%) |
|||||||||||||||||||
Volume of New Loans Facilitated |
||||||||||||||||||||||||
Direct sales |
221.6 | 45.0 | 274.6 | 48.6 | 321.1 | 49.5 | ||||||||||||||||||
Channel partners |
213.6 | 43.4 | 223.9 | 39.6 | 244.4 | 37.7 | ||||||||||||||||||
Online and telemarketing |
57.4 | 11.7 | 66.5 | 11.8 | 82.9 | 12.8 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
492.7 |
100.0 |
565.0 |
100.0 |
648.4 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(%) |
||||||||||||
Origination Cost |
||||||||||||
New loan volume based borrower acquisition cost (1) |
2.8 | 2.4 | 2.2 | |||||||||
Retail credit facilitation related general sales and marketing expenses (2) |
0.8 | 0.8 | 0.9 | |||||||||
|
|
|
|
|
|
|||||||
Total |
3.6 |
3.2 |
3.1 |
|||||||||
|
|
|
|
|
|
(1) | New loan volume based borrower acquisition cost is calculated based on cost incurred during the year without considering allocation of the amount over the loan tenure and timing impact of IFRS 15 or IFRS 9. |
(2) | Retail credit facilitation related general sales and marketing expenses mainly consisted of salary and premises of our proprietary salesforce, loan related promotion and channel management expenses. |
For the Year Ended December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(%) |
(RMB billions) |
(%) |
(RMB billions) |
(%) |
|||||||||||||||||||
Volume of New Loans Facilitated |
||||||||||||||||||||||||
Ping An ecosystem |
197.4 | 92.4 | 204.9 | 91.5 | 190.2 | 77.8 | ||||||||||||||||||
Other channel partners |
16.2 | 7.6 | 19.0 | 8.5 | 54.2 | 22.2 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total channel partners |
213.6 |
100.0 |
223.9 |
100.0 |
244.4 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(%) |
(RMB billions) |
(%) |
(RMB billions) |
(%) |
|||||||||||||||||||
Volume of New Loans Facilitated by Funding Source |
||||||||||||||||||||||||
Banks |
312.0 | 63.2 | 357.6 | 63.3 | 414.2 | 63.9 | ||||||||||||||||||
Trusts |
104.9 | 21.2 | 198.2 | 35.1 | 208.9 | 32.2 | ||||||||||||||||||
Microloan and consumer finance subsidiaries |
0.8 | 0.2 | 9.2 | 1.6 | 25.3 | 3.9 | ||||||||||||||||||
Peer-to-peer |
76.0 | 15.4 | — | — | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
493.7 |
100.0 |
565.0 |
100.0 |
648.4 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(%) |
||||||||||||
Guarantee Status |
||||||||||||
Insured or guaranteed by third parties |
95.6 | 88.8 | 77.5 | |||||||||
Not insured nor guaranteed by third parties |
4.4 | 11.2 | 22.5 | |||||||||
Credit risk borne by us |
2.2 | 6.3 | 16.6 | |||||||||
Credit risk borne by funding partners |
2.2 | 4.9 | 5.9 | |||||||||
|
|
|
|
|
|
|||||||
Total |
100.0 |
100.0 |
100.0 |
|||||||||
|
|
|
|
|
|
In the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB millions) |
||||||||||||
Amount of claims submitted |
805.1 | 1,938.8 | 5,084.4 | |||||||||
Amount of claims reimbursed |
801.3 | 1,940.1 | 5,084.4 |
DPD 30+ Delinquency Rates by Type of Loan |
As of December 31, |
|||||||||||
2019 |
2020 |
2021 |
||||||||||
General unsecured loans |
1.8 | 2.3 | 2.6 | |||||||||
Secured loans |
0.6 | 0.7 | 0.8 | |||||||||
|
|
|
|
|
|
|||||||
Total |
1.6 |
2.0 |
2.2 |
|||||||||
|
|
|
|
|
|
DPD 90+ Delinquency Rates by Type of Loan |
As of December 31, |
|||||||||||
2019 |
2020 |
2021 |
||||||||||
(%) |
||||||||||||
General unsecured loans |
1.0 | 1.3 | 1.5 | |||||||||
Secured loans |
0.3 | 0.4 | 0.4 | |||||||||
|
|
|
|
|
|
|||||||
Total |
0.8 |
1.2 |
1.2 |
|||||||||
|
|
|
|
|
|
As of December 31, |
||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||
YOY% |
YOY% |
|||||||||||||||||||
Number of registered users (millions) |
44.0 | 46.2 | 4.9 | 51.6 | 11.8 | |||||||||||||||
Number of active investors (millions) |
12.5 | 14.9 | 19.0 | 15.5 | 4.3 | |||||||||||||||
Total client assets (RMB billions) |
346.9 | 426.6 | 23.0 | 432.7 | 1.4 | |||||||||||||||
Current products (RMB billions) |
243.6 | 407.2 | 67.2 | 432.7 | 6.2 | |||||||||||||||
Legacy products (RMB billions) |
103.3 | 19.4 | (81.3 | ) | — | — | ||||||||||||||
Average client assets in total products per active investor (RMB) |
27,743 | 28,663 | 3.3 | 27,885 | (2.7 | ) | ||||||||||||||
Average client assets in current products per active investor (RMB) |
19,774 | 27,671 | 39.9 | 28,146 | 1.7 | |||||||||||||||
Contribution of client assets from active investors with client assets over RMB300,000 (%) |
73.1 | 75.5 | 81.0 |
Note: | The two columns marked “YOY%” show the percentage increase or decrease in the absolute numbers compared to the corresponding numbers from one year earlier. |
As of December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(%) |
(RMB billions) |
(%) |
(RMB billions) |
(%) |
|||||||||||||||||||
Total Client Assets for Current Products |
||||||||||||||||||||||||
Up to RMB100,000 |
22.8 | 9.4 | 21.1 | 5.2 | 21.7 | 5.0 | ||||||||||||||||||
RMB100,001 to RMB300,000 |
47.9 | 19.7 | 50.0 | 12.3 | 48.6 | 11.2 | ||||||||||||||||||
RMB300,001 to RMB1,000,000 |
69.8 | 28.7 | 95.7 | 23.5 | 97.9 | 22.6 | ||||||||||||||||||
RMB1,000,001 or more |
96.2 | 39.5 | 210.5 | 51.7 | 252.4 | 58.3 | ||||||||||||||||||
Others (1) |
6.8 | 2.8 | 29.9 | 7.4 | 12.2 | 2.8 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
243.6 |
100.0 |
407.2 |
100.0 |
432.7 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Others includes stocks and recent cooperation with third parties where detailed breakdowns of average customer client assets is not yet available to us. |
As of December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB) |
||||||||||||
Average Client Assets in Current Products per Active Investor |
||||||||||||
Up to RMB100,000 |
1,944 | 1,488 | 1,461 | |||||||||
RMB100,001 to RMB300,000 |
140,317 | 167,404 | 186,434 | |||||||||
RMB300,001 to RMB1,000,000 |
362,274 | 510,520 | 570,217 | |||||||||
RMB1,000,001 or more |
1,468,741 | 2,693,993 | 3,194,897 | |||||||||
Average client assets in current products per active investor |
19,774 |
27,671 |
28,146 |
As of December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
Average Number of Products Held per Active Investor |
||||||||||||
Up to RMB100,000 |
1.3 | 1.2 | 1.2 | |||||||||
RMB100,001 to RMB300,000 |
3.8 | 4.0 | 4.8 | |||||||||
RMB300,001 to RMB1,000,000 |
5.8 | 6.6 | 7.9 | |||||||||
RMB1,000,001 or more |
8.5 | 11.0 | 11.9 | |||||||||
Average number of products held |
1.6 |
1.5 |
1.4 |
Province |
Total Client Assets |
Active Investors |
Average Client Assets per Active Investor |
|||||||||
(RMB billions) |
(thousands) |
(RMB) |
||||||||||
Guangdong |
63.6 | 2,150 | 29,581 | |||||||||
Shanghai |
43.7 | 749 | 58,344 | |||||||||
Beijing |
34.6 | 634 | 54,574 | |||||||||
Zhejiang |
34.2 | 963 | 35,514 | |||||||||
Jiangsu |
33.7 | 1,250 | 26,960 | |||||||||
Shandong |
24.7 | 1,434 | 17,225 | |||||||||
Liaoning |
21.1 | 714 | 29,552 | |||||||||
Fujian |
16.2 | 614 | 26,384 | |||||||||
Hubei |
13.7 | 764 | 17,932 | |||||||||
Heilongjiang |
13.3 | 482 | 27,593 | |||||||||
Other |
133.9 | 5,762 | 23,233 | |||||||||
|
|
|
|
|
|
|||||||
Total |
432.7 |
15,516 |
27,885 |
|||||||||
|
|
|
|
|
|
As of December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(% of total) |
(RMB billions) |
(% of total) |
(RMB billions) |
(% of total) |
|||||||||||||||||||
Client Assets by Product Category |
||||||||||||||||||||||||
Asset management plans |
94.2 | 27.2 | 95.3 | 22.3 | 54.4 | 12.6 | ||||||||||||||||||
Bank products |
49.2 | 14.2 | 177.1 | (1) |
41.5 | 222.7 | (1) |
51.5 | ||||||||||||||||
Private investment funds |
26.4 | 7.6 | 26.3 | 6.2 | 34.6 | 8.0 | ||||||||||||||||||
Mutual funds, excluding money market funds |
22.6 | 6.5 | 30.3 | 7.1 | 29.2 | 6.7 | ||||||||||||||||||
Money market funds |
18.1 | 5.2 | 22.8 | 5.3 | 18.5 | 4.3 | ||||||||||||||||||
Trust products |
16.0 | 4.6 | 36.8 | 8.6 | 53.0 | 12.2 | ||||||||||||||||||
Others (2) |
17.0 | 4.9 | 18.5 | 4.3 | 20.3 | 4.7 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total of Current Products |
243.6 |
70.2 |
407.2 |
95.5 |
432.7 |
100.0 |
||||||||||||||||||
Legacy Products |
103.3 | 29.8 | 19.4 | 4.5 | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total of All Products |
346.9 |
100.0 |
426.6 |
100.0 |
432.7 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Bank products include online deposit products, Ping An Bank flagship store products within the Lufax App and wealth management products from subsidiaries of commercial banks. |
(2) | Others includes stocks, insurance products and cash balance in accounts. |
As of December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(%) |
(RMB billions) |
(%) |
(RMB billions) |
(%) |
|||||||||||||||||||
Client Assets by Category |
||||||||||||||||||||||||
Securities investment |
21.0 | 79.5 | 20.5 | 77.9 | 30.4 | 87.8 | ||||||||||||||||||
Private equity and venture capital |
5.4 | 20.5 | 5.8 | 22.1 | 3.9 | 11.3 | ||||||||||||||||||
Others |
— | — | — | — | 0.3 | 0.9 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Private Investment Funds |
26.4 |
100.0 |
26.3 |
100.0 |
34.6 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(%) |
(RMB billions) |
(%) |
(RMB billions) |
(%) |
|||||||||||||||||||
Client Assets by Mutual Fund Type |
||||||||||||||||||||||||
Money market funds |
18.1 | 44.5 | 22.8 | 42.9 | 18.5 | 38.9 | ||||||||||||||||||
Hybrid funds |
10.0 | 24.6 | 17.6 | 33.1 | 17.5 | 36.8 | ||||||||||||||||||
Fixed income funds |
9.6 | 23.5 | 7.2 | 13.5 | 5.4 | 11.3 | ||||||||||||||||||
Equity funds |
2.9 | 7.0 | 5.0 | 9.4 | 5.7 | 12.0 | ||||||||||||||||||
Other |
0.1 | 0.4 | 0.4 | 0.8 | 0.6 | 1.3 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Mutual Funds |
40.7 |
100.0 |
53.2 |
100.0 |
47.6 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31 |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(%) |
(RMB billions) |
(%) |
(RMB billions) |
(%) |
|||||||||||||||||||
Client Assets by Category |
||||||||||||||||||||||||
Stocks |
5.2 | 30.7 | 7.4 | 40.0 | 9.1 | 44.8 | ||||||||||||||||||
Insurance products |
3.2 | 19.0 | 4.7 | 25.4 | 7.6 | 37.4 | ||||||||||||||||||
Cash balance in accounts |
8.5 | 50.3 | 6.3 | 34.1 | 3.5 | 17.2 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Others |
17.0 |
100.0 |
18.5 |
100.0 |
20.3 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB billions) |
(%) |
(RMB billions) |
(%) |
(RMB billions) |
(%) |
|||||||||||||||||||
Total Client Assets by Channel |
||||||||||||||||||||||||
Ping An ecosystem |
102.4 | 43.2 | 186.5 | 49.4 | 226.5 | 53.9 | ||||||||||||||||||
Online direct marketing |
90.8 | 38.3 | 134.7 | 35.7 | 141.2 | 33.6 | ||||||||||||||||||
Member referral |
43.6 | 18.4 | 56.1 | 14.9 | 52.8 | 12.6 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
236.9 |
100.0 |
377.3 |
100.0 |
420.5 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Note: | Excludes “others.” |
As of December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(millions) |
(%) |
(millions) |
(%) |
(millions) |
(%) |
|||||||||||||||||||
Active Investors by Channel |
||||||||||||||||||||||||
Ping An ecosystem |
4.3 | 34.9 | 4.6 | 31.3 | 4.8 | 31.2 | ||||||||||||||||||
Online direct marketing |
3.8 | 30.9 | 5.4 | 36.7 | 5.8 | 37.7 | ||||||||||||||||||
Member referral |
4.2 | 33.8 | 4.7 | 32.0 | 4.8 | 31.2 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
12.3 |
100.0 |
14.7 |
100.0 |
15.4 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Note: | Excludes “others.” |
As of December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB) |
||||||||||||
Average Client Assets per Active Investor |
||||||||||||
Ping An ecosystem |
23,800 | 40,158 | 47,583 | |||||||||
Online direct marketing |
23,611 | 25,175 | 24,149 | |||||||||
Member referral |
10,467 | 11,879 | 11,087 |
Active Clients |
Client Assets (1) |
|||||||||||
(millions) |
(RMB billions) |
(% of total) |
||||||||||
Client Numbers by Risk Tolerance |
||||||||||||
C1 and unrated |
9.9 | 38.4 | 9.1 | |||||||||
C2 |
3.1 | 106.5 | 25.3 | |||||||||
C3 |
1.6 | 106.9 | 25.4 | |||||||||
C4 |
0.7 | 88.9 | 21.1 | |||||||||
C5 |
0.2 | 79.8 | 19.0 | |||||||||
|
|
|
|
|
|
|||||||
Total |
15.5 |
420.5 |
100.0 |
|||||||||
|
|
|
|
|
|
(1) | Excludes others |
Client Assets |
||||||||
(RMB billions) |
(% of total) |
|||||||
Client Assets by Risk Ratings |
||||||||
R1 |
65.5 | 15.1 | ||||||
R2 |
65.5 | 15.1 | ||||||
R3 |
28.6 | 6.6 | ||||||
R4 |
17.3 | 4.0 | ||||||
R5 |
4.7 | 1.1 | ||||||
Trust products(1) |
50.0 | 11.6 | ||||||
Unrated(2) |
201.1 | 46.5 | ||||||
|
|
|
|
|||||
Total |
432.7 |
100.0 |
||||||
|
|
|
|
(1) | Certain trust products have a separate system of risk ratings with seven levels |
(2) | Unrated products are primarily cash balance in accounts and stocks |
(1) | the financial assets of the family are not less than RMB5 million, or in the last three years, the average annual income of the family is not less than RMB400,000, and has more than two years of investment experience; |
(2) | the net assets are not less than RMB10 million at the end of the previous year; |
(3) | other cases of qualified investors recognized by the financial supervision and administration authorities. |
(1) | obtain a client agreement which is signed by a client by way of an electronic signature together with a copy of the client’s identity document (an identity card or relevant sections of the client’s passport); |
(2) | successfully transfer an initial deposit of not less than HK$10,000 from a bank account in the client’s name maintained with a licensed bank in Hong Kong (Designated Bank Account) to the intermediary’s bank account; |
(3) | conduct all future deposits and withdrawals for the client’s trading account through the Designated Bank Account(s) only; and |
(4) | maintain proper records of the account opening process for each client which are readily accessible for compliance checking and audit purposes. |
• |
Entity/Ownership |
• |
Registration & Licensing |
• |
Limitation of Activities |
• |
OJK Approval |
• |
Mitigation Risk |
• |
Customer Protection |
• |
DC and DRC |
• |
Anti-Money Laundering & Terrorism Prevention |
• |
Prohibition |
• |
Report |
(1) | At the registration stage, a peer-to-peer |
(2) | At the licensing stage, a peer-to-peer |
C. |
Organizational Structure |
(1) | Shenzhen Ping An Financial Technology Consulting Co., Ltd, Xinjiang Tongjun Equity Investment Limited Partnership, Shanghai Lanbang Investment Limited Liability Company and Linzhi Jinsheng Investment Management Limited Partnership hold 49.99%, 29.55%, 18.29% and 2.17%, respectively, of the equity interests in each of Shanghai Xiongguo Corporation Management Co., Ltd. and Shenzhen Lufax Holding Enterprise Management Co., Ltd. |
(2) | Shanghai Xiongguo Corporation Management Co., Ltd. and Shanghai Huikang Information Technology Co., Ltd. hold 99.995% and 0.005%, respectively, of the equity interests in Shanghai Lufax Information Technology Co., Ltd. (formerly known as Shanghai Lujiazui International Financial Asset Exchange Co., Ltd.). |
(3) | Harmonious Splendor Limited and Ping An Puhui Enterprises Management Co., Ltd. hold 90.625% and 9.375%, respectively, of the equity interests in Chongqing Jin An Microloan Limited. |
(4) | Ping An Insurance (Group) Company of China, Ltd., Harmonious Splendor Limited, Weikun (Shanghai) Technology Service Co., Ltd., and Jinjiong (Shenzhen) Technology Service Limited hold 30%, 28%, 27% and 15%, respectively, of the equity interests in Ping An Consumer Finance Co., Ltd. |
• | exercise effective control over the consolidated affiliated entities and their subsidiaries; |
• | receive substantially all of the economic benefits from the consolidated affiliated entities and their subsidiaries; and |
• | have an exclusive option to purchase all or part of the equity interests and assets in the consolidated affiliated entities and when and to the extent permitted by PRC law. |
D. |
Property, Plant and Equipment |
Number of Facilities |
Aggregate Size (m 2 ) |
|||||||
Guangdong |
73 | 75,069 | ||||||
Shanghai |
16 | 72,923 | ||||||
Jiangsu |
58 | 58,730 | ||||||
Shandong |
41 | 41,423 | ||||||
Hubei |
27 | 35,897 | ||||||
Sichuan |
31 | 34,423 | ||||||
Hebei |
35 | 33,546 | ||||||
Henan |
30 | 33,215 | ||||||
Anhui |
21 | 26,741 | ||||||
Hunan |
27 | 23,440 | ||||||
Other |
291 | 212,454 | ||||||
|
|
|
|
|||||
Total |
650 |
647,860 |
||||||
|
|
|
|
A. |
Operating Results |
As of and For the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB billions, except number of investors and percentages) |
||||||||||||
Retail Credit Facilitation |
||||||||||||
Outstanding balance of loans facilitated |
462.2 | 545.1 | 661.0 | |||||||||
Percentage with risk exposure for our company |
2.2 | % | 6.3 | % | 16.6 | % | ||||||
Off–balance sheet |
414.0 | 426.7 | 446.3 | |||||||||
Without credit risk exposure |
409.4 | 405.7 | 381.5 | |||||||||
With credit risk exposure |
4.6 | 21.0 | 64.7 | |||||||||
On–balance sheet |
48.2 | 118.5 | 214.8 | |||||||||
Without credit risk exposure |
42.7 | 105.3 | 169.6 | |||||||||
With credit risk exposure |
5.5 | 13.2 | 45.1 | |||||||||
Volume of new loans facilitated |
493.7 | 565.0 | 648.4 | |||||||||
Off–balance sheet |
440.7 | 423.1 | 414.2 | |||||||||
On–balance sheet |
53.0 | 141.9 | 234.2 | |||||||||
Weighted average contractual tenor (months) (1) |
||||||||||||
General unsecured products |
35.2 | 35.3 | 35.4 | |||||||||
Secured products |
35.9 | 36.0 | 35.9 | |||||||||
Retail credit facilitation service related income over average outstanding balance of loans facilitated (2) |
10.7 | % | 9.5 | % | 9.7 | % | ||||||
Wealth Management |
||||||||||||
Number of registered users (millions) |
44.0 | 46.2 | 51.6 | |||||||||
Number of active investors (millions) |
12.5 | 14.9 | 15.5 | |||||||||
Total client assets |
346.9 | 426.6 | 432.7 | |||||||||
Current products |
243.6 | 407.2 | 432.7 | |||||||||
Legacy products |
103.3 | 19.4 | — |
(1) | Calculated as contractual tenor weighted by volume of new loans facilitated |
(2) | Calculated as the sum of retail credit facilitation service fees, net interest income, guarantee income, and penalty fees and account management fees divided by the average outstanding balance of loans facilitated for the four quarters in each year. |
For the Year Ended December 31, |
||||||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||||||
RMB |
% |
RMB |
% |
RMB |
US$ |
% |
||||||||||||||||||||||
(in millions, except percentages) | ||||||||||||||||||||||||||||
Technology platform–based income: |
||||||||||||||||||||||||||||
Retail credit facilitation service fees |
39,325 | 82.2 | 39,457 | 75.8 | 36,087 | 5,663 | 58.4 | |||||||||||||||||||||
Wealth management transaction and service fees |
2,604 | 5.4 | 1,765 | 3.4 | 2,207 | 346 | 3.6 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total technology platform–based income |
41,929 | 87.7 | 41,222 | 79.2 | 38,294 | 6,009 | 61.9 | |||||||||||||||||||||
Net interest income |
3,909 | 8.2 | 7,750 | 14.9 | 14,174 | 2,224 | 22.9 | |||||||||||||||||||||
Guarantee income |
465 | 1.0 | 602 | 1.2 | 4,370 | 686 | 7.1 | |||||||||||||||||||||
Other income |
879 | 1.8 | 1,517 | 2.9 | 3,875 | 608 | 6.3 | |||||||||||||||||||||
Investment income |
579 | 1.2 | 940 | 1.8 | 1,152 | 181 | 1.9 | |||||||||||||||||||||
Share of net profits of investments accounted for using the equity method |
73 | 0.2 | 15 | 0.0 | (31 | ) | (5 | ) | (0.1 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total income |
47,834 |
100.0 |
52,046 |
100.0 |
61,835 |
9,703 |
100.0 |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||
(RMB millions) |
(%) |
(RMB millions) |
(%) |
(RMB millions) |
(%) |
|||||||||||||||||||
Loan facilitation service fees |
9,716 | 24.7 | 7,142 | 18.1 | 5,676 | 15.7 | ||||||||||||||||||
Post-origination service fees |
29,608 | 75.3 | 32,315 | 81.9 | 30,411 | 84.3 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total retail credit facilitation service fees |
39,325 |
100.0 |
39,457 |
100.0 |
36,087 |
100.0 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Retail credit facilitation service fees |
2022 |
2023 |
2024 |
Total |
||||||||||||||||||||||||||||
(RMB millions, except percentages) | ||||||||||||||||||||||||||||||||
Expected period of recognition |
20,909 | 68.0% | 8,131 | 26.4% | 1,725 | 5.6% | 30,765 | 100.0% |
As of December 31 |
||||||||
2020 |
2021 |
|||||||
(months) | ||||||||
General unsecured loans |
19.18 | 19.37 | ||||||
Secured loans |
12.64 | 13.44 |
General Unsecured loans |
Secured loans |
Total |
||||||||||
(RMB millions) | ||||||||||||
Change in estimated effective tenor |
||||||||||||
–1 month |
(2,279 | ) | (308 | ) | (2,587 | ) | ||||||
+1 month |
2,250 | 300 | 2,550 |
In the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB millions) |
||||||||||||
Current products and services: |
||||||||||||
Current products |
331 | 593 | 478 | |||||||||
Platform fees |
— | 131 | 706 | |||||||||
Other service fees |
129 | 298 | 593 | |||||||||
|
|
|
|
|
|
|||||||
Current products and services |
459 | 1,022 | 1,777 | |||||||||
Legacy products |
2,146 | 743 | 430 | |||||||||
|
|
|
|
|
|
|||||||
Total |
2,604 |
1,765 |
2,207 |
|||||||||
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||
RMB |
RMB |
RMB |
US$ |
|||||||||||||
(in millions) | ||||||||||||||||
Consolidated trust plans: |
||||||||||||||||
Interest income |
2,030 | 10,641 | 21,230 | 3,331 | ||||||||||||
Interest expense |
(965 | ) | (4,283 | ) | (8,401 | ) | (1,318 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net interest income from consolidated trust plans |
1,066 | 6,358 | 12,829 | 2,013 | ||||||||||||
Microloans and consumer finance: |
||||||||||||||||
Interest income |
2,896 | 1,396 | 1,535 | 241 | ||||||||||||
Interest expense |
(52 | ) | (3 | ) | (190 | ) | (30 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net interest income from microloans and consumer finance |
2,844 | 1,393 | 1,345 | 211 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net interest income |
3,909 |
7,750 |
14,174 |
2,224 |
||||||||||||
|
|
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||||||
RMB |
% |
RMB |
% |
RMB |
US$ |
% |
||||||||||||||||||||||
(in millions, except percentages) | ||||||||||||||||||||||||||||
Sales and marketing expenses |
14,931 | 31.2 | 17,814 | 34.2 | 17,993 | 2,823 | 29.1 | |||||||||||||||||||||
General and administrative expenses |
2,853 | 6.0 | 2,976 | 5.7 | 3,559 | 558 | 5.8 | |||||||||||||||||||||
Operation and servicing expenses |
5,471 | 11.4 | 6,031 | 11.6 | 6,558 | 1,029 | 10.6 | |||||||||||||||||||||
Technology and analytics expenses |
1,952 | 4.1 | 1,792 | 3.4 | 2,084 | 327 | 3.4 | |||||||||||||||||||||
Credit impairment losses |
1,863 | 3.9 | 3,035 | 5.8 | 6,644 | 1,043 | 10.7 | |||||||||||||||||||||
Asset impairment losses |
135 | 0.3 | 7 | 0.0 | 1,101 | 173 | 1.8 | |||||||||||||||||||||
Finance costs |
1,520 | 3.2 | 2,866 | 5.5 | 996 | 156 | 1.6 | |||||||||||||||||||||
Other (gains)/losses – net |
(325 | ) | (0.7 | ) | (384 | ) | (0.7 | ) | (499 | ) | (78 | ) | (0.8 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total expenses |
28,400 |
59.4 |
34,136 |
65.6 |
38,435 |
6,031 |
62.2 |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||||||
(RMB) | % | (RMB) | % | (RMB) | (US$) | % | ||||||||||||||||||||||
(in millions, except percentages) | ||||||||||||||||||||||||||||
Direct sales |
3,646 | 41.8 | 4,928 | 42.8 | 4,462 | 700 | 44.1 | |||||||||||||||||||||
Channel partners |
3,925 | 45.1 | 5,510 | 47.9 | 4,922 | 772 | 48.6 | |||||||||||||||||||||
Online and telemarketing |
1,143 | 13.1 | 1,068 | 9.3 | 735 | 115 | 7.3 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total borrower acquisition costs |
8,715 |
100.0 |
11,506 |
100.0 |
10,120 |
1,588 |
100.0 |
For the Year Ended December 31, |
||||||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||||||
(RMB) | (%) | (RMB) | (%) | (RMB) | (US$) | (%) | ||||||||||||||||||||||
(in millions, except percentages) | ||||||||||||||||||||||||||||
Ping An ecosystem |
476 | 53.1 | 485 | 59.1 | 327 | 51.3 | 48.3 | |||||||||||||||||||||
Online direct marketing |
324 | 36.7 | 298 | 36.3 | 262 | 41.1 | 38.7 | |||||||||||||||||||||
Member referral |
89 | 10.2 | 37 | 4.5 | 88 | 13.8 | 13.0 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total investor acquisition and retention costs |
889 |
100.0 |
820 |
100.0 |
677 |
106.2 |
100.0 |
For the Year Ended December 31, |
||||||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||||||
(RMB) | (%) | (RMB) | (%) | (RMB) | (US$) | (%) | ||||||||||||||||||||||
(in millions, except percentages) | ||||||||||||||||||||||||||||
Borrower acquisition |
8,715 | 58.4 | 11,506 | 64.6 | 10,120 | 1,588 | 56.2 | |||||||||||||||||||||
Investor acquisition and retention |
889 | 6.0 | 820 | 4.6 | 677 | 106 | 3.8 | |||||||||||||||||||||
General sales and marketing expenses |
5,328 | 35.7 | 5,487 | 30.8 | 7,197 | 1,129 | 40.0 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total sales and marketing expenses |
14,931 |
100.0 |
17,814 |
100.0 |
17,993 |
2,823 |
100.0 |
For the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB millions) | ||||||||||||
Credit impairment losses |
1,863 | 3,035 | 6,644 | |||||||||
Asset impairment losses |
135 | 7 | 1,101 | |||||||||
|
|
|
|
|
|
|||||||
Total |
1,998 |
3,042 |
7,745 |
|||||||||
|
|
|
|
|
|
For the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB millions) | ||||||||||||
Loan-related (1) |
761 | 2,996 | 6,349 | |||||||||
Investment-related (2) |
1,011 | 18 | 273 | |||||||||
Others (3) |
226 | 28 | 1,123 | |||||||||
|
|
|
|
|
|
|||||||
Total |
1,998 |
3,042 |
7,745 |
|||||||||
|
|
|
|
|
|
(1) | Loan-related impairment losses consist of actual and expected losses from loan to customers, accounts and other receivables and contract assets related to our retail credit facilitation business and guarantee contracts. |
(2) | Investment related impairment losses consist of losses from financial assets at amortized cost. |
(3) | Other impairment losses primarily consist of losses from accounts and other receivables related to wealth management business, goodwill and intangible assets. |
For the Year Ended December 31, |
||||||||||||||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||||||||||||||
(RMB) |
(%) |
(RMB) |
(%) |
(RMB) |
(US$) |
(%) |
||||||||||||||||||||||
(in millions, except percentages) |
||||||||||||||||||||||||||||
Technology platform–based income: |
||||||||||||||||||||||||||||
Retail credit facilitation service fees: |
||||||||||||||||||||||||||||
Loan facilitation service fees |
9,716 | 20.3 | 7,142 | 13.7 | 5,676 | 891 | 9.2 | |||||||||||||||||||||
Post-origination service fees |
29,608 | 61.9 | 32,315 | 62.1 | 30,411 | 4,772 | 49.2 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Retail credit facilitation service fees |
39,325 | 82.2 | 39,457 | 75.8 | 36,087 | 5,663 | 58.4 | |||||||||||||||||||||
Wealth management transaction and service fees |
2,604 | 5.4 | 1,765 | 3.4 | 2,207 | 346 | 3.6 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total technology platform–based income |
41,929 | 87.7 | 41,222 | 79.2 | 38,294 | 6,009 | 61.9 | |||||||||||||||||||||
Net interest income |
3,909 | 8.2 | 7,750 | 14.9 | 14,174 | 2,224 | 22.9 | |||||||||||||||||||||
Guarantee income |
465 | 1.0 | 602 | 1.2 | 4,370 | 686 | 7.1 | |||||||||||||||||||||
Other income |
879 | 1.8 | 1,517 | 2.9 | 3,875 | 608 | 6.3 | |||||||||||||||||||||
Investment income |
579 | 1.2 | 940 | 1.8 | 1,152 | 181 | 1.9 | |||||||||||||||||||||
Share of net profits of investments accounted for using the equity method |
73 | 0.2 | 15 | 0.0 | (31 | ) | (5 | ) | (0.1 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total income |
47,834 |
100.0 |
52,046 |
100.0 |
61,835 |
9,703 |
100.0 |
|||||||||||||||||||||
Sales and marketing expenses: |
||||||||||||||||||||||||||||
Borrower acquisition |
(8,715 | ) | (18.2 | ) | (11,506 | ) | (22.1 | ) | (10,120 | ) | (1,588 | ) | (16.4 | ) | ||||||||||||||
Investor acquisition and retention |
(889 | ) | (1.9 | ) | (820 | ) | (1.6 | ) | (677 | ) | (106 | ) | (1.1 | ) | ||||||||||||||
General sales and marketing expenses |
(5,328 | ) | (11.1 | ) | (5,487 | ) | (10.5 | ) | (7,197 | ) | (1,129 | ) | (11.6 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Sales and marketing expenses |
(14,931 | ) | (31.2 | ) | (17,814 | ) | (34.2 | ) | (17,993 | ) | (2,823 | ) | (29.1 | ) | ||||||||||||||
General and administrative expenses |
(2,853 | ) | (6.0 | ) | (2,976 | ) | (5.7 | ) | (3,559 | ) | (558 | ) | (5.8 | ) | ||||||||||||||
Operation and servicing expenses |
(5,471 | ) | (11.4 | ) | (6,031 | ) | (11.6 | ) | (6,558 | ) | (1,029 | ) | (10.6 | ) | ||||||||||||||
Technology and analytics expenses |
(1,952 | ) | (4.1 | ) | (1,792 | ) | (3.4 | ) | (2,084 | ) | (327 | ) | (3.4 | ) | ||||||||||||||
Credit impairment losses |
(1,863 | ) | (3.9 | ) | (3,035 | ) | (5.8 | ) | (6,644 | ) | (1,043 | ) | (10.7 | ) | ||||||||||||||
Asset impairment losses |
(135 | ) | (0.3 | ) | (7 | ) | (0.0 | ) | (1,101 | ) | (173 | ) | (1.8 | ) | ||||||||||||||
Finance costs |
(1,520 | ) | (3.2 | ) | (2,866 | ) | (5.5 | ) | (996 | ) | (156 | ) | (1.6 | ) | ||||||||||||||
Other gains/(losses)–net |
325 | 0.7 | 384 | 0.7 | 499 | 78 | 0.8 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total expenses |
(28,400 |
) |
(59.4 |
) |
(34,136 |
) |
(65.6 |
) |
(38,435 |
) |
(6,031 |
) |
(62.2 |
) | ||||||||||||||
Profit before income tax |
19,434 | 40.6 | 17,910 | 34.4 | 23,400 | 3,672 | 37.8 | |||||||||||||||||||||
Less: Income tax expenses |
(6,117 | ) | (12.8 | ) | (5,633 | ) | (10.8 | ) | (6,691 | ) | (1,050 | ) | (10.8 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Net profit |
13,317 |
27.8 |
12,276 |
23.6 |
16,709 |
2,622 |
27.0 |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
B. |
Liquidity and Capital Resources |
For the Year Ended December 31, |
||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||
RMB |
RMB |
RMB |
US$ |
|||||||||||||
(in millions) |
||||||||||||||||
Summary Consolidated Cash Flows Data: |
||||||||||||||||
Net cash generated from operating activities |
2,192 | 7,121 | 4,987 | 783 | ||||||||||||
Net cash generated from/(used in) investing activities |
(11,014 | ) | (15,004 | ) | 314 | 49 | ||||||||||
Net cash generated from/(used in) financing activities |
(2,612 | ) | 24,874 | (2,448 | ) | (384 | ) | |||||||||
Effect of exchange rate changes on cash and cash equivalents |
170 | (518 | ) | (143 | ) | (22 | ) | |||||||||
Net increase/(decrease) in cash and cash equivalents |
(11,264 | ) | 16,474 | 2,711 | 425 | |||||||||||
Cash and cash equivalents at beginning of the year |
18,576 | 7,312 | 23,786 | 3,733 | ||||||||||||
Cash and cash equivalents at end of the year |
7,312 | 23,786 | 26,496 | 4,158 |
• | capital contributions to our PRC subsidiaries must be approved by or reported to the Ministry of Commerce or its local counterparts; and |
• | loans by us to our PRC subsidiaries to finance their activities cannot exceed statutory limits and must be registered with SAFE or its local branches. |
As of December 31, |
||||||||||||||||
2019 |
2020 |
2021 |
||||||||||||||
RMB |
RMB |
RMB |
US$ |
|||||||||||||
(in millions) |
||||||||||||||||
Financing guarantee commitments |
4,639 | 20,969 | 64,731 | 10,158 |
Total |
Less than 1 year |
1–3 years |
3–5 years |
More than 5 years |
||||||||||||||||||||||||||||||||||||
RMB |
US$ |
RMB |
US$ |
RMB |
US$ |
RMB |
US$ |
RMB |
US$ |
|||||||||||||||||||||||||||||||
(in millions) |
||||||||||||||||||||||||||||||||||||||||
Non-cancellable leases |
837 | 131 | 494 | 78 | 334 | 52 | 9 | 1 | — | — |
C. |
Research and Development |
D. |
Trend Information |
E. |
Critical Accounting Estimates |
A. |
Directors and Senior Management |
Directors and Executive Officers |
Age |
Position/Title | ||
Guangheng Ji | 53 | Chairman of the Board | ||
Gregory Dean Gibb | 55 | Director and Co-Chief Executive Officer | ||
Yong Suk Cho | 51 | Director and Co-Chief Executive Officer | ||
Rui Li | 51 | Director | ||
Rusheng Yang | 54 | Independent Director | ||
Weidong Li | 53 | Independent Director | ||
Xudong Zhang | 56 | Independent Director | ||
Yunwei Tang | 77 | Independent Director | ||
David Xianglin Li | 58 | Independent Director | ||
James Xigui Zheng | 56 | Chief Financial Officer | ||
David Siu Kam Choy | 47 | Controller and Chief Financial Officer of Puhui | ||
Jinliang Mao | 55 | Chief Technology Officer | ||
Jian Yang | 52 | Chief Risk Officer |
B. |
Compensation |
Name |
Ordinary Shares Underlying Equity Awards Granted |
Exercise Price (RMB/ Share) |
Date of Grant |
Date of Expiration | ||||
Guangheng Ji | * | N/A for performance share units | April 1, 2020 and November 1, 2020 | Various dates between April 1, 2030 and November 1, 2035 | ||||
Gregory Dean Gibb | * | N/A for performance share units; 8.00 – 98.06 for options | Various dates between December 22, 2014 and November 1, 2020 | Various dates between December 22, 2024 and November 1, 2035 | ||||
Yong Suk Cho | * | N/A for performance share units; 50.00 –118.00 for options | Various dates between August 14, 2015 and November 1, 2020 | Various dates between August 14, 2025 and November 1, 2035 | ||||
James Xigui Zheng | * | N/A for performance share units; 8.00 – 118.00 for options | Various dates between December 22, 2014 and November 1, 2020 | Various dates between December 22, 2024 and November 1, 2035 | ||||
David Siu Kam Choy | * | N/A for performance share units; 8.00 for options | Various dates between December 22, 2014 and November 1, 2020 | Various dates between December 22, 2024 and November 1, 2035 | ||||
Jinliang Mao | * | N/A for performance share units; 50.00 –118.00 for options | Various dates between August 14, 2015 and November 1, 2020 | Various dates between August 14, 2025 and November 1, 2035 | ||||
Jian Yang | * | N/A for performance share units | April 1, 2021 | Various dates between April 1, 2031 and April 1, 2036 |
(1) | *Less than 1% of our total outstanding shares. |
C. |
Board Practices |
• | selecting the independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by the independent registered public accounting firm; |
• | reviewing with the independent registered public accounting firm any audit problems or difficulties and management’s response; |
• | reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act; |
• | discussing the annual audited financial statements with management and the independent registered public accounting firm; |
• | reviewing major issues as to the adequacy of our internal controls and any special audit steps adopted in light of material control deficiencies; |
• | annually reviewing and reassessing the adequacy of our audit committee charter; |
• | meeting separately and periodically with management and the independent registered public accounting firm; and |
• | reporting regularly to the board. |
• | recommending nominees to the board for election or re-election to the board, or for appointment to fill any vacancy on the board; |
• | reviewing annually with the board the current composition of the board with regards to characteristics such as independence, age, skills, experience and availability of service to us; |
• | selecting and recommending to the board the names of directors to serve as members of the audit committee, as well as of the nomination and remuneration committee itself; |
• | monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance; |
• | reviewing the total compensation package for our executive officers and making recommendations to the board with respect to it; |
• | reviewing the compensation of our non-employee directors and making recommendations to the board with respect to it; and |
• | periodically reviewing and approving any long-term incentive compensation or equity plans, programs or similar arrangements, annual bonuses, and employee pension and welfare benefit plans. |
D. |
Employees |
Number of Employees |
Percentage |
|||||||
Sales and marketing, retail credit facilitation |
73,349 | 79.4 | ||||||
Direct sales |
63,789 | 69.1 | ||||||
Channel management |
4,947 | 5.4 | ||||||
Online sales |
4,613 | 5.0 | ||||||
Sales and marketing, wealth management |
448 | 0.5 | ||||||
Credit assessment |
2,320 | 2.5 | ||||||
Post-origination services |
10,093 | 10.9 | ||||||
General and administrative |
4,431 | 4.8 | ||||||
Technology and research |
1,302 | 1.4 | ||||||
Other |
437 | 0.5 | ||||||
|
|
|
|
|||||
Total |
92,380 |
100.0 |
||||||
|
|
|
|
Number of Employees |
Percentage |
|||||||
Guangdong |
10,140 | 11.0 | ||||||
Jiangsu |
9,595 | 10.4 | ||||||
Shanghai |
7,278 | 7.9 | ||||||
Shandong |
6,531 | 7.1 | ||||||
Hubei |
5,537 | 6.0 | ||||||
Hebei |
5,523 | 6.0 | ||||||
Henan |
4,580 | 5.0 | ||||||
Sichuan |
4,409 | 4.8 | ||||||
Anhui |
4,292 | 4.6 | ||||||
Hunan |
3,156 | 3.4 | ||||||
Other |
31,339 | 33.9 | ||||||
|
|
|
|
|||||
Total |
92,380 |
100.0 |
||||||
|
|
|
|
E. |
Share Ownership |
• | each of our directors and executive officers; and |
• | each person known to us to beneficially own more than 5% of our total outstanding shares on an as-converted basis. |
Ordinary Shares Beneficially Owned |
||||||||
Number |
% |
|||||||
Directors and Executive Officers**: |
||||||||
Guangheng Ji |
— | — | ||||||
Gregory Dean Gibb (1) |
* | * | ||||||
Yong Suk Cho (2) |
* | * | ||||||
Rui Li (3) |
— | — | ||||||
Rusheng Yang (4) |
— | — | ||||||
Weidong Li (5) |
— | — | ||||||
Xudong Zhang |
— | — | ||||||
Yunwei Tang |
— | — | ||||||
David Xianglin Li (6) |
— | — | ||||||
James Xigui Zheng |
* | * | ||||||
David Siu Kam Choy (2) |
* | * | ||||||
Jinliang Mao |
* | * | ||||||
Jian Yang |
— | — | ||||||
All Directors and Executive Officers as a Group |
* | * | ||||||
Principal Shareholders: |
||||||||
Ping An Group (7) |
474,905,000 | 41.6 | ||||||
Tun Kung Company Limited (8) |
324,994,253 | 28.4 |
* | Less than 1% of our total outstanding shares. |
** | Except as indicated otherwise below, the business address of our directors and executive officers is No. 1088 Yuanshen Road 28/F, Shanghai, People’s Republic of China. |
(1) | The business address of Mr. Gregory Dean Gibb is 28th Floor, Pingan Fortune Tower, 1088 Yuanshen Road, Shanghai, People’s Republic of China. |
(2) | The business address of Mr. Yong Suk Cho and Mr. David Siu Kam Choy is 19th Floor, Tower A, Shanghai Ping An Building, No. 206 Kaibin Road, Xuhui District, Shanghai, People’s Republic of China. |
(3) | The business address of Mr. Rui Li is 47F Yitian Road No. 5033, Futian District, Shenzhen, Guangdong, People’s Republic of China. |
(4) | The business address of Mr. Rusheng Yang is 2609B, Jinzhonghuan Commerce Building, No. 3037 Jintian Road, Futian District, Shenzhen, People’s Republic of China. |
(5) | The business address of Mr. Weidong Li is 1603 Pilkem Commercial Centre, 8 Pilkem Street, Kowloon, Hong Kong. |
(6) | The business address of Mr. David Xianglin Li is Office 714, 211 West Huaihai Road, Shanghai, People’s Republic of China. |
(7) | Represents 285,000,000 ordinary shares held by An Ke Technology Company Limited, a Hong Kong company and 189,905,000 ordinary shares held by China Ping An Insurance Overseas (Holdings) Limited, a Hong Kong company. An Ke Technology Company Limited is a wholly owned subsidiary of Shenzhen Ping An Financial Technology Consulting Co. Ltd. which is wholly owned by Ping An Insurance (Group) Company of China, Ltd., a company incorporated under the laws of the PRC whose shares are listed on the Shanghai Stock Exchange and the Hong Kong Stock Exchange. The registered address of An Ke Technology Company Limited is Suite 2353, 23/F, Two International Finance Centre, 8 Finance Street, Central, Hong Kong. China Ping An Insurance Overseas (Holdings) Limited is a direct wholly-owned subsidiary of Ping An Insurance (Group) Company of China, Ltd. The registered address of China Ping An Insurance Overseas (Holdings) Limited is Suite 2318, 23/F, Two International Finance Centre, 8 Finance Street, Central, Hong Kong. |
(8) | Represents 324,994,253 ordinary shares held by Tun Kung Company Limited, a British Virgin Islands company, excluding 6,555,944 ordinary shares which are ordinary shares converted to 13,111,888 ADSs and recorded in and represented by a collateral account held in the name of Tun Kung Company Limited with Goldman Sachs International pursuant to a covered call arrangement by and among Tun Kung Company Limited, Goldman Sachs International and Goldman Sachs (Asia) L.L.C. in December 2021. As of March 15, 2022, each of Tongjun Investment Company Limited and Lanbang Investment Company Limited owns 52.33% and 47.67% of the issued and outstanding share capital of Tun Kung Company Limited, respectively. Further, as of March 31, 2022, each of Tongjun Investment Company Limited and Lanbang Investment Company Limited owns 46.5% and 53.5% of the issued and outstanding share capital of Tun Kung Company Limited, respectively. Tongjun Investment Company Limited and Lanbang Investment Company Limited are both British Virgin Islands companies. Each of the two individuals, Mr. Wenwei Dou and Ms. Wenjun Wang, owns 50% of Tongjun Investment Company Limited’s shares. Each of the two individuals, Mr. Xuelian Yang and Mr. Jingkui Shi, owns 50% of Lanbang Investment Company Limited’s shares. |
• | the instrument of transfer is lodged with us and is accompanied by the certificate for the shares to which it relates and such other evidence as our directors may reasonably require to show the right of the transferor to make the transfer; |
• | the instrument of transfer is in respect of only one class of share; |
• | the instrument of transfer is properly stamped (in circumstances where stamping is required); and |
• | fee of such maximum sum as the NYSE may determine to be payable or such lesser sum as our directors may from time to time require is paid to us in respect thereof. |
• | the designation (or re-designations as the case may be) of the class or series; |
• | the number of shares of the class or series; |
• | the dividend rights, dividend rates, conversion rights, voting rights; and |
• | the rights and terms of redemption and liquidation preferences. |
• | increase our share capital by such sum, to be divided into shares of such amount, as the resolution shall prescribe; |
• | consolidate and divide all or any of our share capital into shares of a larger amount than our existing shares; |
• | sub-divide our shares or any of them into shares of smaller amount than is fixed by our memorandum of association, subject nevertheless to the Companies Act, so that the resolution whereby any share is sub-divided may determine that, as between the holders of the shares resulting from such subdivision, one or more of the shares may have any such preferred, deferred or other special rights over, or may have such deferred rights or be subject to any such restrictions as compared with the others, as we have power to attach to unissued or new shares; and |
• | cancel any shares which, at the date of the passing of the resolution, have not been taken or agreed to be taken by any person and diminish the amount of our share capital by the amount of the shares so canceled subject to the provisions of the Companies Act. |
• | an exempted company does not have to file an annual return of its shareholders with the Registrar of Companies; |
• | subject to its memorandum and articles of association, an exempted company’s register of members is not required to be open to inspection; |
• | subject to its memorandum and articles of association, an exempted company does not have to hold an annual general meeting; |
• | an exempted company may issue no par value, negotiable shares; |
• | an exempted company may obtain an undertaking against the imposition of any future taxation (such undertakings are usually given for 20 years in the first instance); |
• | an exempted company may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands; and |
• | an exempted company may register as a limited duration company; and an exempted company may register as a segregated portfolio company. |
• | the statutory provisions as to the required majority vote have been met; |
• | the shareholders have been fairly represented at the meeting in question and the statutory majority are acting bona fide without coercion of the minority to promote interests adverse to those of the class; |
• | the arrangement is such that may be reasonably approved by an intelligent and honest man of that class acting in respect of his interest; and |
• | the arrangement is not one that would more properly be sanctioned under some other provision of the Companies Act. |
• | an act which is ultra vires or illegal and is therefore incapable of ratification by the shareholders; |
• | the act complained of, although not ultra vires, could only be effected duly if authorized by more than a simple majority vote that has not been obtained; and |
• | an act which constitute a fraud against the minority where the wrongdoer are themselves in control of the company. |
• | a duty to act in good faith in the best interests of the company, |
• | a duty not to make a personal profit based on his or her position as director (unless the company permits him or her to do so), |
• | a duty not to put himself or herself in a position where the interests of the company conflict with his or her personal interest or his or her duty to a third party, and |
• | a duty to exercise powers for the purpose for which such powers were intended. |
C. |
Material Contracts |
D. |
Exchange Controls |
E. |
Taxation |
(1) | that no law which is enacted in the Cayman Islands imposing any tax to be levied on profits or income or gains or appreciation shall apply to us or our operations; and |
(2) | that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable: |
(i) | on or in respect of our shares, debentures or other obligations; or |
(ii) | by way of the withholding in whole or in part of any relevant payment as defined in Section 6(3) of the Tax Concessions Act. |
• | banks and other financial institutions; |
• | insurance companies; |
• | pension plans; |
• | cooperatives; |
• | regulated investment companies; |
• | real estate investment trusts; |
• | broker-dealers; |
• | traders that elect to use a mark-to-market |
• | certain former U.S. citizens or long-term residents; |
• | tax-exempt entities (including private foundations); |
• | persons liable for alternative minimum tax; |
• | persons who acquire their ADSs or ordinary shares pursuant to any employee share option or otherwise as compensation; |
• | investors that will hold their ADSs or ordinary shares as part of a straddle, hedge, conversion, constructive sale or other integrated transaction for U.S. federal income tax purposes; |
• | investors that have a functional currency other than the U.S. dollar; |
• | persons that actually or constructively own ADSs or ordinary shares representing 10% or more of our stock (by vote or value); or |
• | partnerships or other entities taxable as partnerships for U.S. federal income tax purposes, or persons holding ADSs or ordinary shares through such entities, |
• | an individual who is a citizen or resident of the United States; |
• | a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created in, or organized under the laws of, the United States or any state thereof or the District of Columbia; |
• | an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or |
• | a trust (A) the administration of which is subject to the primary supervision of a U.S. court and which has one or more U.S. persons who have the authority to control all substantial decisions of the trust or (B) that has otherwise validly elected to be treated as a U.S. person under the Code. |
• | the excess distribution or gain will be allocated ratably over the U.S. Holder’s holding period for the ADSs or ordinary shares; |
• | the amount allocated to the taxable year of the distribution or gain and any taxable years in the U.S. Holder’s holding period prior to the first taxable year in which we are classified as a PFIC will be taxable as ordinary income; and |
• | the amount allocated to each prior taxable year other than a year included in the preceding bullet point will be subject to tax at the highest tax rate in effect for individuals or corporations, as appropriate, for that year, increased by an additional tax equal to the interest on the resulting tax deemed deferred with respect to each such taxable year. |
Profit before income tax |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB millions) | ||||||||||||
5% appreciation of RMB |
15 | 131 | 699 | |||||||||
5% depreciation of RMB |
(15 | ) | (131 | ) | (699 | ) |
As of December 31, 2021 |
||||||||||||||||||||||||||||||||
< 3 months |
3 months to 1 year |
1 to 2 years |
2 to 3 years |
> 3 years |
Overdue |
No interest |
Total |
|||||||||||||||||||||||||
(RMB millions) | ||||||||||||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||||||||||
Cash at bank |
29,263 | 71 | 364 | 1,539 | 3,507 | — | — | 34,743 | ||||||||||||||||||||||||
Restricted cash |
27,792 | 554 | 1,786 | 306 | 14 | — | — | 30,454 | ||||||||||||||||||||||||
Financial assets at fair value through profit or loss |
12,545 | 3,459 | 919 | 263 | — | 1,164 | 12,672 | 31,023 | ||||||||||||||||||||||||
Financial assets at amortized cost |
1,169 | 501 | 921 | 108 | — | 1,087 | — | 3,785 | ||||||||||||||||||||||||
Financial assets at purchased under reverse repurchased agreements |
5,527 | — | — | — | — | — | — | 5,527 | ||||||||||||||||||||||||
Accounts and other receivables and contract assets |
— | — | — | — | — | — | 22,345 | 22,345 | ||||||||||||||||||||||||
Loans to customers |
51,563 | 98,296 | 51,346 | 11,182 | 1 | 2,584 | — | 214,972 | ||||||||||||||||||||||||
Total financial assets |
127,859 | 102,881 | 55,336 | 13,398 | 3,523 | 4,835 | 35,017 | 342,849 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
LIABILITIES |
||||||||||||||||||||||||||||||||
Payable to platform investors |
— | — | — | — | — | — | 2,748 | 2,748 | ||||||||||||||||||||||||
Borrowings |
13,074 | 12,853 | — | — | — | — | — | 25,927 | ||||||||||||||||||||||||
Accounts and other payables and contract liabilities |
— | — | — | — | — | — | 8,814 | 8,814 | ||||||||||||||||||||||||
Payable to investors of consolidated structured entities |
46,086 | 95,848 | 48,048 | 5,463 | — | — | — | 195,446 | ||||||||||||||||||||||||
Financing guarantee liabilities |
— | — | — | — | — | — | 2,697 | 2,697 | ||||||||||||||||||||||||
Lease liabilities |
142 | 322 | 238 | 83 | 9 | — | — | 795 | ||||||||||||||||||||||||
Convertible promissory note payable |
— | — | 10,669 | — | — | — | — | 10,669 | ||||||||||||||||||||||||
Optionally convertible promissory notes |
— | — | 7,405 | — | — | — | — | 7,405 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total financial liabilities |
59,302 | 109,024 | 66,361 | 5,546 | 9 | — | 14,259 | 254,502 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Nominal amount of interest rate swap |
(8,225 | ) | — | 8,225 | — | — | — | — | — | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total interest rate sensitivity gap |
76,782 | (6,143 | ) | (19,250 | ) | 7,851 | 3,514 | 4,835 | 20,758 | 88,347 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, 2021 |
||||||||||||||||
1–29 days past due |
30–89 days past due |
Overdue more than 89 days |
Total |
|||||||||||||
(RMB millions) | ||||||||||||||||
Gross carrying amount of loans to customers |
1,462 | 1,576 | 624 | 3,663 | ||||||||||||
ECL allowance |
(185 | ) | (312 | ) | (581 | ) | (1,079 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
1,277 | 1,264 | 43 | 2,584 |
For the Year Ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB millions) | ||||||||||||
Change in interest rate |
||||||||||||
–100 basis points |
(318 | ) | (488 | ) | (649 | ) | ||||||
+100 basis points |
318 | 488 | 649 |
• | The fluctuation rates of different interest-bearing assets and liabilities are the same; |
• | All assets and liabilities are re-priced in the middle of relevant periods; |
• | Analysis is based on static gap on reporting date, regardless of subsequent changes; |
• | No consideration of impact on customers’ behavior resulting from interest rate changes; |
• | No consideration of impact on market price resulting from interest rate changes; |
• | No consideration of actions taken by us. |
As at December 31, 2019 | ||||||||||||||||||||||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
Purchased or Originated Credit Impaired |
Maximum Credit Risk Exposure |
||||||||||||||||||||||||||||||||
(RMB millions) | ||||||||||||||||||||||||||||||||||||
Book value |
||||||||||||||||||||||||||||||||||||
On-balance sheet |
||||||||||||||||||||||||||||||||||||
Financial assets at amortized cost |
7,209 | — | 1,334 | 80 | 8,623 | |||||||||||||||||||||||||||||||
Loans to customers |
46,916 | 271 | 312 | — | 47,499 | |||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
Total |
54,125 |
271 |
1,646 |
80 |
56,122 |
|||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
Off-balance sheet |
||||||||||||||||||||||||||||||||||||
Financing guarantee commitment |
4,600 | 39 | — | — | 4,639 |
As at December 31, 2020 |
||||||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
Purchased or Originated Credit Impaired |
Maximum Credit Risk Exposure |
||||||||||||||||
(RMB millions) | ||||||||||||||||||||
Book value |
||||||||||||||||||||
On-balance sheet |
||||||||||||||||||||
Financial assets at amortized cost |
5,508 | — | 975 | 81 | 6,564 | |||||||||||||||
Loans to customers |
119,088 | 644 | 94 | — | 119,826 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total |
124,596 |
644 |
1,069 |
81 |
126,390 |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Off-balance sheet |
||||||||||||||||||||
Financing guarantee commitment |
20,898 | 71 | — | — | 20,969 |
As at December 31, 2021 |
||||||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
Purchased or Originated Credit Impaired |
Maximum Credit Risk Exposure |
||||||||||||||||
(RMB millions) | ||||||||||||||||||||
Book value |
||||||||||||||||||||
On-balance sheet |
||||||||||||||||||||
Financial assets at amortized cost |
2,698 | — | 585 | 502 | 3,785 | |||||||||||||||
Loans to customers |
213,665 | 1,264 | 43 | — | 214,972 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total |
216,363 | 1,264 | 628 | 502 | 218,757 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Off-balance sheet |
||||||||||||||||||||
Financing guarantee commitment |
64,417 | 314 | — | — | 64,731 |
• | A financial instrument that is not credit-impaired on initial recognition is classified in “Stage 1” and has its credit risk continuously monitored by us. |
• | If a significant increase in credit risk since initial recognition is identified, the financial instrument is moved to “Stage 2” but is not yet deemed to be credit-impaired. |
• | If the financial instrument is credit-impaired, the financial instrument is then moved to “Stage 3.” |
Stage 1 |
Stage 2 |
Stage 3 | ||
(Initial recognition) |
(Significant increase in credit risk since initial recognition) | (Credit-impaired assets) | ||
12-month ECL |
Lifetime ECL | Lifetime ECL |
As of December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
(RMB millions, except percentages) |
||||||||||||
Total ECL and financing guarantee liabilities under assumption of reclassification of financial assets from stage 2 to stage 1 |
1,425 | 1,542 | 4,898 | |||||||||
Total ECL and financing guarantee liabilities related to ECL recognized in the consolidated balance sheet |
1,494 | 1,738 | 5,451 | |||||||||
|
|
|
|
|
|
|||||||
Difference—amount |
(69) | (196) | (553) | |||||||||
Difference—ratio |
(5%) | (13%) | (10%) |
As of December 31, 2021 |
||||||||||||||||||||||||||||||||||||||||||||
Repayable on demand or undated |
Within 1 year |
1 to 2 years |
2 to 3 years |
Over 3 years |
Total |
|||||||||||||||||||||||||||||||||||||||
(RMB millions) | ||||||||||||||||||||||||||||||||||||||||||||
Financial liabilities |
||||||||||||||||||||||||||||||||||||||||||||
Payable to platform investors |
2,748 | — | — | — | — | 2,748 | ||||||||||||||||||||||||||||||||||||||
Borrowings |
— | 16,718 | 9,628 | — | — | 26,346 | ||||||||||||||||||||||||||||||||||||||
Accounts and other payables and contract liabilities |
8,814 | — | — | — | — | 8,814 | ||||||||||||||||||||||||||||||||||||||
Payable to investors of consolidated structured entities |
46 | 148,079 | 49,505 | 5,571 | — | 203,201 | ||||||||||||||||||||||||||||||||||||||
Financing guarantee liabilities |
64,731 | — | — | — | — | 64,731 | ||||||||||||||||||||||||||||||||||||||
Lease liabilities |
— | 484 | 249 | 85 | 9 | 828 | ||||||||||||||||||||||||||||||||||||||
Convertible promissory note payable |
— | 92 | 12,503 | — | — | 12,595 | ||||||||||||||||||||||||||||||||||||||
Optionally convertible promissory notes |
— | 443 | 7,824 | — | — | 8,266 | ||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||
76,339 | 165,817 | 79,709 | 5,656 | 9 | 327,530 | |||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, 2019 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
(RMB millions) |
||||||||||||||||
Financial assets at fair value through profit or loss |
||||||||||||||||
Unlisted Securities |
||||||||||||||||
Asset management plans |
— | 6,057 | 794 | 6,850 | ||||||||||||
Mutual funds |
5,733 | — | — | 5,733 | ||||||||||||
Trust plans |
— | 1,788 | 1,683 | 3,470 | ||||||||||||
Factoring products |
— | 1,480 | 344 | 1,824 | ||||||||||||
Structured deposits |
— | 431 | — | 431 | ||||||||||||
Bank wealth management products |
— | 252 | — | 252 | ||||||||||||
Corporate bond |
— | — | 15 | 15 | ||||||||||||
Private fund investment |
— | — | 8 | 8 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
5,733 |
10,007 |
2,843 |
18,583 |
||||||||||||
|
|
|
|
|
|
|
|
As of December 31, 2020 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
(RMB millions) |
||||||||||||||||
Financial assets at fair value through profit or loss |
|
|||||||||||||||
Unlisted Securities |
||||||||||||||||
Asset management plans |
— | 9,328 | 424 | 9,752 | ||||||||||||
Mutual funds |
3,199 | — | — | 3,199 | ||||||||||||
Trust plans |
— | 9,106 | 821 | 9,927 | ||||||||||||
Factoring products |
— | 824 | — | 824 | ||||||||||||
Structured deposits |
— | 962 | — | 962 | ||||||||||||
Bank wealth management products |
— | 2,092 | — | 2,092 | ||||||||||||
Corporate bond |
— | 3,029 | 15 | 3,044 | ||||||||||||
Private fund and other equity investments |
— | 4,618 | 6 | 4,624 | ||||||||||||
Derivative instruments |
||||||||||||||||
Interest rate swap |
— | (12 | ) | — | (12 | ) | ||||||||||
Foreign currency swaps |
— | (536 | ) | — | (536 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
3,199 |
29,411 |
1,266 |
33,876 |
||||||||||||
|
|
|
|
|
|
|
|
As of December 31, 2021 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
(RMB millions) |
||||||||||||||||
Financial assets at fair value through profit or loss |
||||||||||||||||
Unlisted Securities |
||||||||||||||||
Asset management plans |
— | 7,802 | 506 | 8,308 | ||||||||||||
Mutual funds |
2,487 | — | — | 2,487 | ||||||||||||
Trust plans |
— | 2,448 | 604 | 3,052 | ||||||||||||
Structured deposits |
— | 6,641 | — | 6,641 | ||||||||||||
Bank wealth management products |
— | 4,589 | — | 4,589 | ||||||||||||
Corporate bond |
— | 3,018 | 47 | 3,065 | ||||||||||||
Private fund and other equity investments |
— | 2,765 | — | 2,765 | ||||||||||||
Others |
— | — | 109 | 109 | ||||||||||||
Listed Securities |
||||||||||||||||
Stock |
8 | — | — | 8 | ||||||||||||
Derivative instruments |
||||||||||||||||
Interest rate swap |
— | 38 | — | 38 | ||||||||||||
Foreign currency swap |
— | (26 | ) | — | (26 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
2,494 |
27,276 |
1,265 |
31,036 |
||||||||||||
|
|
|
|
|
|
|
|
For the Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
Financial assets at fair value through profit or loss |
||||||||||||
(RMB millions) |
||||||||||||
As of beginning of the year |
2,633 |
2,843 |
1,266 |
|||||||||
Additions |
1,353 | — | 132 | |||||||||
Disposal |
(1,961 | ) | (1,267 | ) | (30 | ) | ||||||
Transfer into level 3 |
1,478 | — | 1,036 | |||||||||
Transfer out of level 3 |
— | — | (3 | ) | ||||||||
Gains or losses recognized in profit or loss |
(660 | ) | (310 | ) | (1,136 | ) | ||||||
|
|
|
|
|
|
|||||||
As of end of the year |
2,843 |
1,266 |
1,265 |
|||||||||
|
|
|
|
|
|
Service |
Fees | |
• Issuance of ADSs (e.g., an issuance of ADS upon a deposit of ordinary shares, upon a change in the ADS(s)-to-ordinary |
Up to U.S. 5¢ per ADS issued | |
• Cancellation of ADSs (e.g., a cancellation of ADSs for delivery of deposited property, upon a change in the ADS(s)-to-ordinary |
Up to U.S. 5¢ per ADS cancelled | |
• Distribution of cash dividends or other cash distributions (e.g., upon a sale of rights and other entitlements) |
Up to U.S. 5¢ per ADS held | |
• Distribution of ADSs pursuant to (i) stock dividends or other free stock distributions, or (ii) exercise of rights to purchase additional ADSs |
Up to U.S. 5¢ per ADS held | |
• Distribution of securities other than ADSs or rights to purchase additional ADSs (e.g., upon a spin-off) |
Up to U.S. 5¢ per ADS held | |
• ADS Services |
Up to U.S. 5¢ per ADS held on the applicable record date(s) established by the depositary | |
• Registration of ADS transfers (e.g., upon a registration of the transfer of registered ownership of ADSs, upon a transfer of ADSs into DTC and vice versa, or for any other reason) |
Up to U.S. 5¢ per ADS (or fraction thereof) transferred | |
• Conversion of ADSs of one series for ADSs of another series (e.g., upon conversion of Partial Entitlement ADSs for Full Entitlement ADSs, or upon conversion of Restricted ADSs (each as defined in the Deposit Agreement) into freely transferable ADSs, and vice versa). |
Up to U.S. 5¢ per ADS (or fraction thereof) converted |
• | taxes (including applicable interest and penalties) and other governmental charges; |
• | the registration fees as may from time to time be in effect for the registration of ordinary shares on the share register and applicable to transfers of ordinary shares to or from the name of the custodian, the depositary or any nominees upon the making of deposits and withdrawals, respectively; |
• | certain cable, telex and facsimile transmission and delivery expenses; |
• | the fees, expenses, spreads, taxes and other charges of the depositary and/or service providers (which may be a division, branch or affiliate of the depositary) in the conversion of foreign currency; |
• | the reasonable and customary out-of-pocket |
• | the fees, charges, costs and expenses incurred by the depositary, the custodian, or any nominee in connection with the ADR program. |
2020 |
2021 |
|||||||
(RMB millions) |
||||||||
Audit fees (1) |
50.8 | 42.4 | ||||||
Audit-Related fees (2) |
0.1 | 0.2 | ||||||
Tax fees (3) |
2.0 | 1.1 | ||||||
All other fees (2) |
0.8 | — |
(1) | “Audit fees” means the aggregate fees billed or to be billed for each of the fiscal years listed for professional services rendered by our principal auditors for the audit of our annual financial statements and assistance with and review of documents filed with the SEC. In 2020 and 2021, the audit refers to financial audit. |
(2) | “Audit-related fees” means the aggregate fees billed or to be billed for each of the fiscal years listed for agreed audit procedures service and special audit services by our principal auditors. |
(3) | “Tax fees” means the aggregate fees billed or to be billed for each of the fiscal years listed for professional services rendered by our principal auditors for tax compliance, tax advice, and tax planning. |
(4) | “All other fees” means the aggregate fees billed or to be billed for each of the fiscal years listed for professional services rendered by our principal auditors associated with certain permitted advisory services. |
Period |
Total Number of ADSs Purchased |
Average Price Paid per ADS (US$) |
Total Number of ADSs Purchased as Part of Publicly Announced Plans or Programs |
Maximum Dollar Value of ADSs that May Yet be Purchased Under the Plans or Programs (US$) |
||||||||||||
June 1 – June 30, 2021 |
23,303,660 | 12.05 | 23,303,660 | 19,124,485 | ||||||||||||
July 1 – July 31, 2021 |
— | — | 23,303,660 | 19,124,485 | ||||||||||||
August 1 – August 31, 2021 |
2,533,044 | 7.55 | 25,836,704 | — | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
25,836,704 | 11.61 | 25,836,704 | — |
Period |
Total Number of ADSs Purchased |
Average Price Paid per ADS (US$) |
Total Number of ADSs Purchased as Part of Publicly Announced Plans or Programs |
Maximum Dollar Value of ADSs that May Yet be Purchased Under the Plans or Programs (US$) |
||||||||||||
August 1 – August 31, 2021 |
14,530,461 | 7.93 | 14,530,461 | 584,729,848 | ||||||||||||
September 1 – September 30, 2021 |
19,967,185 | 8.21 | 34,497,646 | 420,728,797 | ||||||||||||
October 1 – October 31, 2021 |
500,000 | 7.07 | 34,997,646 | 417,182,497 | ||||||||||||
November 1 – November 30, 2021 |
10,919,610 | 6.64 | 45,917,256 | 344,698,825 | ||||||||||||
December 1 – December 31, 2021 |
35,260,521 | 5.91 | 81,177,777 | 136,456,473 | ||||||||||||
January 1 – January 31, 2022 |
1,261,339 | 4.42 | 82,439,116 | 130,885,290 | ||||||||||||
February 1 – February 28, 2022 |
509,132 | 4.35 | 82,948,248 | 128,662,369 | ||||||||||||
March 1 – March 31, 2022 |
1,124,556 | 4.62 | 84,072,804 | 123,448,815 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
84,072,804 |
6.86 |
84,072,804 |
123,448,815 |
* | Filed with this Annual Report on Form 20-F. |
** | Furnished with this Annual Report on Form 20-F. |
Lufax Holding Ltd | ||
By: |
/s/ Gregory Dean Gibb | |
Name: Gregory Dean Gibb | ||
Title: Director and Co-Chief Executive Officer |
Page(s) |
||||
F-2 |
||||
F-5 |
||||
F-7 |
||||
F-9 |
||||
F-12 |
||||
F-13 |
Year ended December 31, |
||||||||||||||||
Note |
2019 |
2020 |
2021 |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||
Technology platform-based income |
||||||||||||||||
Retail credit facilitation service fees |
6 | |||||||||||||||
Wealth management transaction and service fees |
7 | |||||||||||||||
Net interest income |
8 | |||||||||||||||
Guarantee income |
||||||||||||||||
Other income |
9 | |||||||||||||||
Investment income |
10 | |||||||||||||||
Share of net profit/(loss) of investments accounted for using the equity method |
( |
) | ||||||||||||||
|
|
|
|
|
|
|||||||||||
Total income |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Sales and marketing expenses |
11 | ( |
) | ( |
) | ( |
) | |||||||||
General and administrative expenses |
11 | ( |
) | ( |
) | ( |
) | |||||||||
Operation and servicing expenses |
11 | ( |
) | ( |
) | ( |
) | |||||||||
Technology and analytics expenses |
11 | ( |
) | ( |
) | ( |
) | |||||||||
Credit impairment losses |
12 | ( |
) | ( |
) | ( |
) | |||||||||
Asset impairment losses |
24,26 | ( |
) | ( |
) | ( |
) | |||||||||
Finance costs |
13 | ( |
) | ( |
) | ( |
) | |||||||||
Other gains/(losses) - net |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Total expenses |
( |
) |
( |
) |
( |
) | ||||||||||
|
|
|
|
|
|
|||||||||||
Profit before income tax expenses |
||||||||||||||||
Less: Income tax expenses |
14 | ( |
) | ( |
) | ( |
) | |||||||||
|
|
|
|
|
|
|||||||||||
Net profit for the year |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Net profit attributable to: |
||||||||||||||||
Owners of the Company |
||||||||||||||||
Non-controlling interests |
( |
) | ( |
) | ( |
) | ||||||||||
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
|
Year ended December 31, |
||||||||||||||||
Note |
2019 |
2020 |
2021 |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||
Other comprehensive income/(loss), net of tax: |
||||||||||||||||
-Exchange differences on translation of foreign operations |
( |
) | ||||||||||||||
Total comprehensive income for the year |
||||||||||||||||
Total comprehensive income attributable to: |
||||||||||||||||
Owners of the Company |
||||||||||||||||
Non-controlling interests |
( |
) | ( |
) | ( |
) | ||||||||||
Earnings per share (expressed in RMB per share) |
||||||||||||||||
-Basic earnings per share |
15 | |||||||||||||||
-Diluted earnings per share |
15 | |||||||||||||||
-Basic earnings per ADS |
15 | |||||||||||||||
-Diluted earnings per ADS |
15 | |||||||||||||||
As of December 31, |
||||||||||||
Note |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
|||||||||||
ASSETS |
||||||||||||
Cash at bank |
16 | |||||||||||
Restricted cash |
16 | |||||||||||
Financial assets at fair value through profit or loss |
17 | |||||||||||
Financial assets at amortized cost |
18 | |||||||||||
Financial assets purchased under reverse repurchase agreements |
19 | |||||||||||
Accounts and other receivables and contract assets |
20 | |||||||||||
Loans to customers |
21 | |||||||||||
Deferred tax assets |
22 | |||||||||||
Property and equipment |
23 | |||||||||||
Investments accounted for using the equity method |
||||||||||||
Intangible assets |
24 | |||||||||||
Right-of-use |
25 | |||||||||||
Goodwill |
26 | |||||||||||
Other assets |
27 | |||||||||||
|
|
|
|
|||||||||
Total assets |
||||||||||||
|
|
|
|
|||||||||
LIABILITIES |
||||||||||||
Payable to platform investors |
28 | |||||||||||
Borrowings |
29 | |||||||||||
Current income tax liabilities |
||||||||||||
Accounts and other payables and contract liabilities |
30 | |||||||||||
Payable to investors of consolidated structured entities |
31 | |||||||||||
Financing guarantee liabilities |
32 | |||||||||||
Deferred tax liabilities |
22 | |||||||||||
Lease liabilities |
25 | |||||||||||
Convertible promissory note payable |
33 | |||||||||||
Optionally convertible promissory notes |
34 | |||||||||||
Other liabilities |
35 | |||||||||||
|
|
|
|
|||||||||
Total liabilities |
||||||||||||
|
|
|
|
As of December 31, |
||||||||||||
Note |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
|||||||||||
EQUITY |
||||||||||||
Share capital |
36 | |||||||||||
Share premium |
36 | |||||||||||
Treasury shares |
37 | ( |
) | ( |
) | |||||||
Other reserves |
38 | |||||||||||
Retained earnings |
39 | |||||||||||
|
|
|
|
|||||||||
Total equity attributable to owners’ of the Company |
||||||||||||
|
|
|
|
|||||||||
Non-controlling interests |
||||||||||||
|
|
|
|
|||||||||
Total equity |
||||||||||||
|
|
|
|
|||||||||
Total liabilities and equity |
||||||||||||
|
|
|
|
Note |
Attributable to owners of the Company |
|||||||||||||||||||||||||||||||||
Share capital |
Share premium |
Treasury shares |
Other reserves |
Retained earnings |
Total |
Non- controlling interests |
Total Equity |
|||||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||||
As of January 1, 2019 |
( |
) |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net profit for the year |
— | — | — | — | ( |
) | ||||||||||||||||||||||||||||
Other comprehensive loss |
— | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total comprehensive income for the year |
— |
— |
— |
( |
) |
( |
) |
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Transactions with equity holders |
||||||||||||||||||||||||||||||||||
Issuance of shares held for employee incentive plan |
42 | — | ( |
) | — | — | — | — | — | |||||||||||||||||||||||||
Value of conversion rights – convertible redeemable preferred shares |
38 | — | — | — | — | — | ||||||||||||||||||||||||||||
Contributions from non-controlling interests |
— | — | — | — | — | — | |
|||||||||||||||||||||||||||
Appropriations to general reserve |
38 | — | — | — | ( |
) | — | — | — | |||||||||||||||||||||||||
Share-based payment |
42 | — | — | — | ( |
) | — | ( |
) | ( |
) | ( |
) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
As of December 31, 2019 |
( |
) |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note |
Attributable to owners of the Company |
|||||||||||||||||||||||||||||||||
Share capital |
Share premium |
Treasury shares |
Other reserves |
Retained earnings |
Total |
Non- controlling interests |
Total Equity |
|||||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||||
As of January 1, 2020 |
( |
) |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net profit for the year |
— | — | — | — | ( |
) | ||||||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total comprehensive income for the year |
— |
— |
— |
( |
) |
|||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Transactions with owners |
||||||||||||||||||||||||||||||||||
C-round restructuring |
2, |
— | — | — | — | — | ||||||||||||||||||||||||||||
Issuance of ordinary shares upon initial public offering (“IPO”) and exercise of over-allotment option |
36 | — | — | — | — | |||||||||||||||||||||||||||||
Conversion of Class C ordinary shares and automatically convertible promissory notes to ordinary shares upon IPO |
36 | — | ( |
) | — | — | ||||||||||||||||||||||||||||
Contributions from non-controlling interests |
— | — | — | — | — | — | ||||||||||||||||||||||||||||
Appropriations to general reserve |
— | — | — | ( |
) | — | — | — | ||||||||||||||||||||||||||
Share-based payment |
42 | — | — | — | — | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
As of December 31, 2020 |
( |
) |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note |
Attributable to owners of the Company |
|||||||||||||||||||||||||||||||||
Share capital |
Share premium |
Treasury shares |
Other reserves |
Retained earnings |
Total |
Non- controlling interests |
Total Equity |
|||||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||||
As of January 1, 2021 |
( |
) |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net profit for the year |
— | — | — | — | ( |
) | ||||||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | ( |
) | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total comprehensive income for the year |
— |
— |
— |
( |
) |
|||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Transactions with owners |
||||||||||||||||||||||||||||||||||
Repurchase of ordinary shares |
37 | — | — | ( |
) | — | — | ( |
) | — | ( |
) | ||||||||||||||||||||||
R etirement of ordinary shares |
36, |
( |
) | — | — | — | — | — | — | |||||||||||||||||||||||||
Issuance of ordinary shares for share-based payment |
36, |
— | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Exercise of share-based payment |
36, |
— | — | ( |
) | — | — | |||||||||||||||||||||||||||
Contributions from non-controlling interests |
— | — | — | — | — | — | ||||||||||||||||||||||||||||
Acquisition of non-controlling interests of a subsidiary |
— | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||
Appropriations to general reserve |
— | — | — | ( |
) | — | — | — | ||||||||||||||||||||||||||
Share-based payment |
42 | — | — | — | — | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
As of December 31, 2021 |
( |
) |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||||||||||||||
Note |
2019 |
2020 |
2021 |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||
Cash flows from operating activities |
||||||||||||||||
Cash generated from operating activities |
41(a) | |||||||||||||||
Income tax paid |
( |
) | ( |
) | ( |
) | ||||||||||
|
|
|
|
|
|
|||||||||||
Net cash generated from operating activities |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Cash flows from investing activities |
||||||||||||||||
Proceeds from sale of investment assets |
||||||||||||||||
Proceeds from sale of property and equipment |
||||||||||||||||
Interest received on investment assets |
||||||||||||||||
Payment for acquisition of investment assets |
( |
) | ( |
) | ( |
) | ||||||||||
Securities purchases under agreements to resell, net |
( |
) | ( |
) | ||||||||||||
Payment for property and equipment and other long-term assets |
( |
) | ( |
) | ( |
) | ||||||||||
Payment for acquisition of subsidiary, net of cash acquired |
( |
) | ( |
) | — | |||||||||||
|
|
|
|
|
|
|||||||||||
Net cash generated from/(used in) investing activities |
( |
) |
( |
) |
||||||||||||
|
|
|
|
|
|
|||||||||||
Cash flows from financing activities |
||||||||||||||||
Proceeds from issuance of shares and other equity securities |
||||||||||||||||
Including: Proceeds from capital contribution from the non-controlling shareholder of subsidiaries |
||||||||||||||||
Proceeds from exercise of share-based payment |
||||||||||||||||
Proceeds from borrowing s |
||||||||||||||||
Repayment of borrowings |
( |
) | ( |
) | ( |
) | ||||||||||
Payment for lease liabilities |
( |
) | ( |
) | ( |
) | ||||||||||
Payment for interest expenses |
( |
) | ( |
) | ( |
) | ||||||||||
Payment for acquisition of non-controlling interests of subsidiary |
( |
) | ||||||||||||||
Payment for repurchase of ordinary shares |
( |
) | ||||||||||||||
|
|
|
|
|
|
|||||||||||
Net cash generated from/(used in) financing activities |
( |
) |
( |
) | ||||||||||||
|
|
|
|
|
|
|||||||||||
Effect of exchange rate changes on cash and cash equivalents |
( |
) |
( |
) | ||||||||||||
|
|
|
|
|
|
|||||||||||
Net increase/(decrease) in cash and cash equivalents |
( |
) | ||||||||||||||
Add: Cash and cash equivalents at the beginning of the year |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Cash and cash equivalents at the end of the year |
41 | (c) |
||||||||||||||
|
|
|
|
|
|
1 |
General information |
2 |
History and reorganization of the Group |
2 |
History and reorganization of the group (Continued) |
2 |
History and reorganization of the group (Continued) |
(a) |
Company Name |
Country/place and date of incorporation |
Attributable equity interest/economic interest to the Group |
||||
Controlled through direct equity holding: |
||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
% | ||||||
Controlled through Contractual Agreements: |
||||||
% | ||||||
% | ||||||
% |
2 |
History and reorganization of the group (Continued) |
(b) |
Name |
Amount of investment by the Group |
Remaining unpaid principal of structured entities (i) |
||||||
RMB’000 |
RMB’000 |
|||||||
Trust A |
||||||||
Trust B |
||||||||
Trust C |
||||||||
Trust D |
||||||||
Trust E |
||||||||
Trust F |
||||||||
Trust G |
||||||||
Trust H |
||||||||
Trust I |
||||||||
Trust J |
(i) |
The remaining unpaid principal is the amount not yet paid to the investors. |
(c) |
PRC laws and regulations prohibit or restrict foreign ownership of companies that conduct certain internet-based business, which include activities and services provided by the Group. The Group operates part of its business in the PRC through a series of contractual arrangements (collectively, “Contractual Arrangements”) entered into among wholly-owned subsidiaries of the Company (“WFOE”), Consolidated Affiliated Entities and the shareholders of Consolidated Affiliated Entities (“Onshore Shareholders”) that are authorized by the Group. The Contractual Arrangements include Exclusive Equity Interest Option Agreements, Exclusive Business Cooperation Arrangements, Exclusive Asset Option Agreements, Share Pledge Agreements and Voting Trust Agreements. |
Contract Date |
WFOE |
OPCO | ||
March 23, 2015 |
Weikun Technology |
Xiongguo | ||
March 23, 2015 |
Weikun Technology |
Shanghai Lufax Information Technology Co., Ltd | ||
November 21, 2018 |
Lufax (Shenzhen) Technology Service Co., Ltd |
Shenzhen Lufax Holding Enterprise Management Co., Ltd |
2 |
History and reorganization of the group (Continued) |
• | Exclusive Equity Interest Option Agreement |
• | Exclusive Business Cooperation Agreement |
• | Exclusive Asset Option Agreement |
• | Share Pledge Agreement |
• | Voting trust Agreement |
2 |
History and reorganization of the group (Continued) |
(d) | Risks in relation to the Consolidated Affiliated Entities |
• |
revoke Consolidated Affiliated Entities’ business and operating licenses; |
• |
require Consolidated Affiliated Entities to discontinue or restrict its operations; |
• |
restrict Consolidated Affiliated Entities’ right to collect revenues; |
• |
block Consolidated Affiliated Entities’ websites; |
• |
require the Group to restructure the operations, re-apply for the necessary licenses or relocate its business, staff and assets; |
2 |
History and reorganization of the group (Continued) |
(d) |
Risks in relation to the Consolidated Affiliated Entities (Continued) |
• |
impose additional conditions or requirements with the Group may not be able to comply; or |
• |
take other regulatory or enforcement actions against the Group that could be harmful to the Group’s business. |
(e) |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Assets arising from intra-group transactions |
||||||||
Amount due from Group companies |
||||||||
Total assets |
||||||||
Amount due to Group companies |
||||||||
Total liabilities |
||||||||
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Inter-company revenues |
( |
) |
||||||||||
Total income |
||||||||||||
Inter-company expenses |
||||||||||||
Net loss |
( |
) |
( |
) |
( |
) | ||||||
Inter-company cash flow |
( |
) |
( |
) |
||||||||
Reclassification (i) |
— |
— |
||||||||||
Other operating activities |
( |
) | ||||||||||
Net cash generated from/(used in) operating activities |
( |
) | ||||||||||
Inter-company cash flow |
— | ( |
) | |||||||||
Reclassification (i) |
— |
— |
( |
) | ||||||||
Payment for advances to consolidated entities |
( |
) |
( |
) |
( |
) | ||||||
Receipts of repayment of the advances from consolidated entities |
||||||||||||
Proceeds from sale of investment assets |
||||||||||||
Payment for acquisition of investment assets |
( |
) |
( |
) |
( |
) | ||||||
Other investing activities |
( |
) |
( |
) |
( |
) | ||||||
Net cash generated from/(used in) investing activities |
( |
) |
( |
) |
||||||||
Repayment for advances to consolidated entities |
( |
) |
( |
) |
( |
) | ||||||
Receipts of advances from consolidated entities |
||||||||||||
Proceeds from borrowings |
||||||||||||
Repayment of interest expenses and borrowings |
( |
) |
( |
) |
( |
) | ||||||
Other financing activities |
( |
) |
— |
( |
) | |||||||
Net cash generated from/(used in) financing activities |
( |
) | ||||||||||
Effect of exchange rate changes on cash and cash equivalents |
— | ( |
) | ( |
) | |||||||
Net increase/(decrease) in cash |
( |
) | ||||||||||
Cash at the beginning of the year |
||||||||||||
Cash at the end of the year |
||||||||||||
(i) |
This represents the reclassification of certain cash flows that were considered as investing activities in the financial statements of consolidated affiliated entities and consolidated affiliated entities’ subsidiaries and as operating activities in the consolidated financial statements. |
2 |
History and reorganization of the group (Continued) |
3 |
Summary of significant accounting policies |
3.1 |
Basis of preparation |
• |
Interest Rate Benchmark Reform Phase 2 – Amendments to IFRS 9, IAS 39 and IFRS 7, IFRS 4 and IFRS 16 |
3 |
Summary of significant accounting policies (Continued) |
3.1 |
Basis of preparation (Continued) |
Effective for the annual periods beginning on or after | ||||
Amendments to IAS 37 |
Onerous Contracts – Cost of Fulfilling a Contract | January 1, 2022 | ||
Amendments to IFRS 3 |
Reference to the Conceptual Framework | January 1, 2022 | ||
Amendments to IAS 16 |
Property, Plant and Equipment: Proceeds before intended use | January 1, 2022 | ||
Annual Improvements to IFRS Standards 2018–2020 |
IFRS 9 Financial Instruments, IFRS 16 Leases, IFRS 1 First- time Adoption of International Financial Reporting Standards, IAS 41 Agriculture |
January 1, 2022 | ||
IFRS 17 |
Insurance contracts | January 1, 2023 | ||
Amendments to IAS 1 |
Classification of Liabilities as Current or Non-current |
January 1, 2023 | ||
Amendments to IAS 1 and IFRS Practice Statement 2 |
Disclosure of Accounting Policies | January 1, 2023 | ||
Amendments to IAS 8 |
Definition of Accounting Estimates | January 1, 2023 | ||
Amendments to IAS 12 |
Deferred Tax related to Assets and Liabilities arising from a Single Transaction | January 1, 2023 | ||
Amendments to IFRS 10 and IAS 28 |
Sale or contribution of assets between an investor and its associate or joint venture | To be determined. |
3 |
Summary of significant accounting policies (Continued) |
3.2 |
Principles of consolidation and equity accounting |
3.2.1 |
Subsidiaries |
3.2.2 |
Associates |
3 |
Summary of significant accounting policies (Continued) |
3.2 |
Principles of consolidation and equity accounting (Continued) |
3.2.2 |
Associates (Continued) |
3.3 |
Structured entities |
3 |
Summary of significant accounting policies (Continued) |
3.4 |
Business combination |
3 |
Summary of significant accounting policies (Continued) |
3.5 |
Segment reporting |
3.6 |
Foreign currency translation |
(i) | Functional and presentation currency |
(ii) | Transactions and balances |
3 |
Summary of significant accounting policies (Continued) |
3.6 |
Foreign currency translation (Continued) |
(ii) | Transactions and balances (Continued) |
(iii) | Group companies |
• | assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet, |
• | income and expenses for each statement of profit or loss and statement of comprehensive income are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions), and |
• | all resulting exchange differences are recognized in other comprehensive income. |
3.7 |
Cash and cash equivalents |
3.8 |
Financial assets |
(i) | Recognition |
3 |
Summary of significant accounting policies (Continued) |
3.8 |
Financial assets (Continued) |
(ii) |
Classification and Measurement |
• |
those to be measured at amortized cost (“AC”); |
• |
those to be measured at fair value through other comprehensive income (“FVOCI”); or |
• |
those to be measured at fair value through profit or loss (“FVPL”). |
• |
Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest, and that are not designated at FVPL are measured at amortized cost. Interest income from these financial assets is included in interest income using the effective interest rate method. Any gain or loss arising from derecognition or impairment is recognized directly in profit or loss. Such assets held by the Group mainly include cash at bank, accounts and other receivables and contract assets, financial assets at amortized cost, financial assets purchased under reverse repurchase agreements, loans to customers, etc. |
• |
FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of principal and interest, and that are not designated as FVPL are measured at FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognized in profit or loss. When the financial asset is derecognized, the cumulative gain or loss on the instrument’s amortized cost previously recognized in OCI is reclassified from equity to profit or loss. Interest income from these financial assets is included in interest income using the effective interest rate method. |
• |
FVPL: Assets that do not meet the criteria for amortized cost or FVOCI are measured at FVPL. The gains or losses arising from fair value changes on the debt investments measured at FVPL are recognized in profit or loss. |
3 |
Summary of significant accounting policies (Continued) |
3.8 |
Financial assets (Continued) |
(ii) | Classification and Measurement (Continued) |
(iii) | Impairment |
• | Choosing appropriate models and assumptions for the measurement of ECL including exposure at default (EAD), probability of default (PD), loss given default (LGD), etc.; |
• | Determining criteria for significant increase in credit risk; |
• | Establishing the number and relative weightings of forward-looking scenarios for the associated ECL. |
3 |
Summary of significant accounting policies (Continued) |
3.8 |
Financial assets (Continued) |
(iii) | Impairment (Continued) |
(iv) | Derecognition |
• | the contractual rights to receive the cash flows from the financial assets have expired; |
• | they have been transferred and the Group transfers substantially all the risks and rewards of ownership; |
• | they have been transferred and the Group neither transfers nor retains substantially all the risks and rewards of ownership and the Group has not retained control. |
3 |
Summary of significant accounting policies (Continued) |
3.9 |
Financial liabilities |
(i) | Financial liabilities at fair value through profit or loss |
• | are incurred principally for the purpose of repurchasing it in the near term; |
• | on initial recognition are part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent actual pattern of short-term profit-taking; or |
• | are derivatives (except for a derivative that is a designated and effective hedging instrument or a financing guarantee contract). |
• | it eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases; or |
• | a group of financial liabilities or financial assets and financial liabilities is managed and its performance is evaluated on a fair value basis, in accordance with a documented risk management or investment strategy, and information about the group is provided internally on that basis to the entity’s key management personnel; or |
• | a contract contains one or more embedded derivatives, with the host being not an asset within the scope of IFRS 9, and the embedded derivative(s) do(es) significantly modify the cash flows. |
3 |
Summary of significant accounting policies (Continued) |
3.9 |
Financial liabilities (Continued) |
(i) | Financial liabilities at fair value through profit or loss |
3.10 |
Determination of fair value |
3.11 |
Offsetting financial instruments |
3 |
Summary of significant accounting policies (Continued) |
3.12 |
Intangible assets |
(i) | Trademarks and licenses |
(ii) | Computer software |
• | is technically feasible to complete the software so that it will be available for use; |
• | management intends to complete the software and use or sell it; |
• | there is an ability to use or sell the software; |
• | it can be demonstrated how the software will generate probable future economic benefits; |
• | adequate technical, financial and other resources to complete the development and to use or sell the software are available; and |
• | the expenditure attributable to the software during its development can be reliably measured. |
(iii) | Amortization methods and periods |
Expected useful life | ||
• Trademarks and licenses |
||
• Computer software |
3 |
Summary of significant accounting policies (Continued) |
3.13 |
Goodwill |
3.14 |
Property and equipment |
3 |
Summary of significant accounting policies (Continued) |
3.14 |
Property and equipment (Continued) |
Category |
Expected useful life |
Estimated residual value rate |
Annual depreciation rate |
|||||||||
Buildings |
% | % | ||||||||||
Office furniture and equipment |
% | % | ||||||||||
Computer and electronic equipment |
5 |
% | % | |||||||||
Motor vehicles |
5 |
% | % | |||||||||
Leasehold improvements |
5 |
% | % |
3.15 |
Impairment of non-financial assets |
3 |
Summary of significant accounting policies (Continued) |
3.15 |
Impairment of non-financial assets (Continued) |
3.16 |
Current and deferred income tax |
(a) | when the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and |
(b) | in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in jointly controlled entities, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future. |
3 |
Summary of significant accounting policies (Continued) |
3.16 |
Current and deferred income tax (Continued) |
(a) | when the deferred tax asset relating to the deductible temporary differences arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and |
(b) | in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in jointly controlled entities, deferred tax assets are only recognized to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized. |
3 |
Summary of significant accounting policies (Continued) |
3.17 |
Borrowings |
3.18 |
Share capital, share premium and treasury shares |
3.19 |
Accounts and other payables |
3 |
Summary of significant accounting policies (Continued) |
3.20 |
Compound financial instruments |
3.21 |
Employee benefits |
(a) | Pension obligations |
(b) | Housing benefits |
(c) | Medical benefits |
3 |
Summary of significant accounting policies (Continued) |
3.22 |
Share-based payment |
3.23 |
Revenue recognition |
• |
provides all of the benefit received and consumed simultaneously by the customer; |
• |
creates and enhances an asset that the customer controls as the Group performs; and |
• |
does not create an asset with an alternative use to the Group and the Group has an enforceable right to payment for performance completed to date. |
• |
direct measurements of the value transferred by the Group to the customer; or |
• |
the Group’s efforts or inputs to the satisfaction of the performance obligation. |
3 |
Summary of significant accounting policies (Continued) |
3.23 |
Revenue recognition (Continued) |
3.23.1 |
Retail credit facilitation service fees |
3 |
Summary of significant accounting policies (Continued) |
3.23 |
Revenue recognition (Continued) |
3.23.1 |
Retail credit facilitation service fees (Continued) |
3.23.2 |
Wealth management transaction and service fees |
3 |
Summary of significant accounting policies (Continued) |
3.23 |
Revenue recognition (Continued) |
3.23.2 |
Wealth management transaction and service fees (Continued) |
3.23.3 |
Interest income |
3.23.4 |
Other income |
3 |
Summary of significant accounting policies (Continued) |
3.24 |
Leases |
• | fixed payments (including in-substance fixed payments), less any lease incentives receivable, |
• | variable lease payments that are based on an index or a rate, |
• | amounts expected to be payable by the lessee under residual value guarantees, |
3 |
Summary of significant accounting policies (Continued) |
3.24 |
Leases (Continued) |
• | the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and |
• | payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option. |
• | the amount of the initial measured of lease liability, |
• | any lease payments made at or before the commencement date less any lease incentives received, |
• | any initial direct costs, and |
• | restoration costs. |
3.25 |
Provisions |
3.26 |
Government grants |
4 |
Financial instruments and risks |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors |
4.1.1 |
Market risk |
(a) | Foreign currency risk |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
5% appreciation of RMB |
||||||||
5% depreciation of RMB |
( |
) | ( |
) |
(b) | Interest rate risk |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.1 |
Market risk (Continued) |
(b) |
Interest rate risk (Continued) |
As of December 31, 2020 |
||||||||||||||||||||||||||||||||
Less than 3 months |
3 months to 1 year |
1-2 years |
2-3 years |
More than 3 years |
Overdue |
No interest |
Total |
|||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||||||||||
Cash at bank |
— | — | — | |||||||||||||||||||||||||||||
Restricted cash |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Financial assets at fair value through profit or loss |
||||||||||||||||||||||||||||||||
Financial assets at amortized cost |
— | |||||||||||||||||||||||||||||||
Financial assets purchased under reverse repurchase agreements |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Accounts and other receivables and contract assets |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Loans to customers |
|
— | — | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total financial assets |
|
|
|
|||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.1 |
Market risk (Continued) |
(b) |
Interest rate risk (Continued) |
As of December 31, 2020 |
||||||||||||||||||||||||||||||||
Less than 3 months |
3 months to 1 year |
1-2 years |
2-3 years |
More than 3 years |
Overdue |
No interest |
Total |
|||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||
LIABILITIES |
||||||||||||||||||||||||||||||||
Payable to platform investors |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Borrowings |
— | — | — | — | ||||||||||||||||||||||||||||
Accounts and other payables and contract liabilities |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Payable to investors of consolidated structured entities |
— | — | — | |||||||||||||||||||||||||||||
Financing guarantee liabilities |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Lease liabilities |
— | — | ||||||||||||||||||||||||||||||
Convertible promissory note payable |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Optionally convertible promissory notes |
— | — | — | — | — | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total financial liabilities |
|
— | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Nominal amount of interest rate swap |
( |
) | — | — | — | — | — | — | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total interest rate sensitivity gap |
|
( |
) | |
||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.1 |
Market risk (Continued) |
(b) |
Interest rate risk (Continued) |
As of December 31, 2021 |
||||||||||||||||||||||||||||||||
Less than 3 months |
3 months to 1 year |
1-2 years |
2-3 years |
More than 3 years |
Overdue |
No interest |
Total |
|||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||||||||||
Cash at bank |
— | — | ||||||||||||||||||||||||||||||
Restricted cash |
— | — | ||||||||||||||||||||||||||||||
Financial assets at fair value through profit or loss |
— | |||||||||||||||||||||||||||||||
Financial assets at amortized cost |
— | — | ||||||||||||||||||||||||||||||
Financial assets purchased under reverse repurchase agreements |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Accounts and other receivables and contract assets |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Loans to customers |
— | |||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total financial assets |
|
|||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.1 |
Market risk (Continued) |
(b) | Interest rate risk (Continued) |
As of December 31, 2021 |
|||||||||||||||||||||||||||||||||
Less than 3 months |
3 months to 1 year |
1-2 years |
2-3 years |
More than 3 years |
Overdue |
No interest |
Total |
||||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||||||||||||
LIABILITIES |
|||||||||||||||||||||||||||||||||
Payable to platform investors |
— | — | — | — | — | — | |||||||||||||||||||||||||||
Borrowings |
— | — | — | — | — | ||||||||||||||||||||||||||||
Accounts and other payables and contract liabilities |
— | — | — | — | — | — | |||||||||||||||||||||||||||
Payable to investors of consolidated structured entities |
— | — | — | ||||||||||||||||||||||||||||||
Financing guarantee liabilities |
— | — | — | — | — | — | |||||||||||||||||||||||||||
Lease liabilities |
— | — | |||||||||||||||||||||||||||||||
Convertible promissory note payable |
— | — | — | — | — | — | |||||||||||||||||||||||||||
Optionally convertible promissory notes |
— | — | — | — | — | — | |||||||||||||||||||||||||||
Total financial liabilities |
— | ||||||||||||||||||||||||||||||||
Nominal amount of interest rate swap |
( |
) | — | — | — | — | — | — | |||||||||||||||||||||||||
Total interest rate sensitivity gap |
( |
) | ( |
) | |||||||||||||||||||||||||||||
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.1 |
Market risk (Continued) |
(b) | Interest rate risk (Continued) |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Change in interest rate |
||||||||
-100 basis points |
( |
) | ( |
) | ||||
+100 basis points |
• | The fluctuation rates of different interest-bearing assets and liabilities are the same; |
• | All assets and liabilities are re-priced in the middle of relevant periods; |
• | Analysis is based on static gap on reporting date, regardless of subsequent changes; |
• | No consideration of impact on customers’ behavior resulting from interest rate changes; |
• | No consideration of impact on market price resulting from interest rate changes; |
• | No consideration of actions taken by the Group. |
4.1.2 |
Credit risk |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.2 |
Credit risk (Continued) |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
On-balance sheet |
||||||||
Cash at bank |
||||||||
Restricted cash |
||||||||
Financial assets at fair value through profit or loss |
||||||||
Financial assets at amortized cost |
||||||||
Financial assets purchased under reverse repurchase agreements |
||||||||
Accounts and other receivables and contract assets |
||||||||
Loans to customers |
||||||||
Off-balance sheet |
||||||||
Financing guarantee contracts |
||||||||
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.2 |
Credit risk (Continued) |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.2 |
Credit risk (Continued) |
• | A financial instrument that is not credit-impaired on initial recognition is classified in ‘Stage 1’ and has its credit risk continuously monitored by the Group. |
• | If a significant increase in credit risk (‘SICR’) since initial recognition is identified, the financial instrument is moved to ‘Stage 2’ but is not yet deemed to be credit-impaired. |
• | If the financial instrument is credit-impaired, the financial instrument is then moved to ‘Stage 3’. |
• | A pervasive concept in measuring ECL in accordance with IFRS 9 is that it should consider forward- looking information. |
| ||||
Stage 1 |
Stage 2 |
Stage 3 | ||
(Initial recognition) | (Significant increase in credit | (Credit-impaired assets) | ||
risk since initial recognition) | ||||
12-month ECL |
Lifetime ECL | Lifetime ECL |
(a) | Significant increase in credit risk (SICR) |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.2 |
Credit risk (Continued) |
(a) | Significant increase in credit risk (SICR) (Continued) |
(b) | Definition of default and credit-impaired assets |
(c) | Measuring ECL – Explanation of inputs, assumptions and estimation techniques |
• |
PD represents the likelihood of a borrower defaulting on its financial obligation (as mentioned in “Definition of default and credit-impaired assets” above), either over the next 12 months (12M PD), or over the remaining lifetime (Lifetime PD) of the obligation. |
• |
Loss Given Default (LGD) represents the Group’s expectation of the extent of loss on a defaulted exposure. LGD varies by type and availability of collateral or other credit support. LGD is expressed as a percentage loss per unit of exposure at the time of default (EAD). |
• |
EAD is based on the amounts the Group expects to be owed at the time of default, over the next 12 months (12M EAD) or over the remaining lifetime (Lifetime EAD). For example, for a revolving commitment, the Group includes the current drawn balance plus any further amount that is expected to be drawn up to the current contractual limit by the time of default, should it occur. |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.2 |
Credit risk (Continued) |
(c) | Measuring ECL – Explanation of inputs, assumptions and estimation techniques (Continued) |
(d) | Forward-looking information incorporated in the ECL models |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.2 |
Credit risk (Continued) |
(d) | Forward-looking information incorporated in the ECL models (Continued) |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
GDP – year on year percentage change |
%- |
% | ||||||
CPI – year on year percentage change |
%- |
% | ||||||
Broad measure of money supply (M1) – year on year percentage change |
%- |
% |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.2 |
Credit risk (Continued) |
(d) | Forward-looking information incorporated in the ECL models (Continued) |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Total ECL and financing guarantee liabilities under assumption of reclassification of financial instruments from stage 2 to stage 1 |
||||||||
Total ECL and financing guarantee liabilities related to ECL recognized in the consolidated balance sheet |
||||||||
Difference-amount |
( |
) | ( |
) | ||||
Difference-ratio |
- |
% | - |
% | ||||
As of December 31, 2020 |
||||||||||||||||||||
Stage I |
Stage II |
Stage III |
POCI |
Maximum Credit Risk Exposure |
||||||||||||||||
(in RMB’000) | ||||||||||||||||||||
Book value | ||||||||||||||||||||
On-balance sheet |
||||||||||||||||||||
Financial assets at amortized cost |
— | |||||||||||||||||||
Loans to customers |
|
— | ||||||||||||||||||
Total |
|
|||||||||||||||||||
Off-balance sheet |
||||||||||||||||||||
Financing guarantee contracts |
— | — | ||||||||||||||||||
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.2 |
Credit risk (Continued) |
As of December 31, 2021 |
||||||||||||||||||||
Stage I |
Stage II |
Stage III |
POCI |
Maximum Credit Risk Exposure |
||||||||||||||||
(in RMB’000) | ||||||||||||||||||||
Book value | ||||||||||||||||||||
On-balance sheet |
||||||||||||||||||||
Financial assets at amortized cost |
— | |||||||||||||||||||
Loans to customers |
— | |||||||||||||||||||
Total |
|
|||||||||||||||||||
Off-balance sheet |
||||||||||||||||||||
Financing guarantee contracts |
— | — | ||||||||||||||||||
4.1.3 |
Liquidity risk |
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.3 |
Liquidity risk (Continued) |
As of December 31, 2020 |
||||||||||||||||||||||||
Repayable on demand or undated |
Within 1 year |
1 to 2 years |
2 to 3 years |
Over 3 years |
Total |
|||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||
Financial liabilities - |
||||||||||||||||||||||||
Payable to platform investors |
— | — | — | — | ||||||||||||||||||||
Borrowings |
— | — | ||||||||||||||||||||||
Accounts and other payables and contract liabilities |
— | — | — | — | ||||||||||||||||||||
Payable to investors of consolidated structured entities |
— | |||||||||||||||||||||||
Financing guarantee liabilities |
— | — | — | — | ||||||||||||||||||||
Lease liabilities |
— | |||||||||||||||||||||||
Convertible promissory note payable |
— | — | ||||||||||||||||||||||
Optionally convertible promissory notes |
— | — | ||||||||||||||||||||||
|
||||||||||||||||||||||||
4 |
Financial instruments and risks (Continued) |
4.1 |
Financial risk factors (Continued) |
4.1.3 |
Liquidity risk (Continued) |
As of December 31, 2021 |
||||||||||||||||||||||||
Repayable on demand or undated |
Within 1 year |
1 to 2 years |
2 to 3 years |
Over 3 years |
Total |
|||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||
Financial liabilities - |
||||||||||||||||||||||||
Payable to platform investors |
— | — | — | — | ||||||||||||||||||||
Borrowings |
— | — | — | |||||||||||||||||||||
Accounts and other payables and contract liabilities |
— | — | — | — | ||||||||||||||||||||
Payable to investors of consolidated structured entities |
— | |||||||||||||||||||||||
Financing guarantee liabilities |
— | — | — | — | ||||||||||||||||||||
Lease liabilities |
— | |||||||||||||||||||||||
Convertible promissory note payable |
— | — | — | |||||||||||||||||||||
Optionally convertible promissory notes |
— | — | — | |||||||||||||||||||||
|
|
|||||||||||||||||||||||
4 |
Financial instruments and risks (Continued) |
4.2 |
Capital management |
• |
To comply with the capital requirements set by the regulators of the markets where the Group operates. |
• |
To safeguard the Group’s ability to continue as a going concern and to maintain healthy capital ratios in order to support its business and to maximize shareholders’ value. |
• |
To maintain a strong capital base to support the development of its business. |
4.3 |
Group’s maximum exposure to structured entities |
4 |
Financial instruments and risks (Continued) |
4.3 |
Group’s maximum exposure to structured entities (Continued) |
As of December 31, 2020 | ||||||||||||||
(In RMB’000) |
Size |
Carrying amount of investment in structured entities |
Group’s maximum exposure |
Interest held by Group | ||||||||||
Unconsolidated structured products managed by third parties (a) |
NA | Investment income | ||||||||||||
Unconsolidated structured products managed by affiliated entities (a) |
NA | Investment income/ service fee | ||||||||||||
Unconsolidated structured products serviced by the Group |
— |
Service fee |
As of December 31, 2021 | ||||||||||||||
(In RMB’000) |
Size |
Carrying amount of investment in structured entities |
Group’s maximum exposure |
Interest held by Group | ||||||||||
Unconsolidated structured products managed by third parties (a) |
NA | Investment income | ||||||||||||
Unconsolidated structured products managed by affiliated entities (a) |
NA | Investment income | ||||||||||||
Unconsolidated structured products serviced by the Group |
— |
Service fee |
(a) |
The information about the size of these unconsolidated structured products cannot be acquired from open market. |
4.4 |
Fair value estimation |
4 |
Financial instruments and risks (Continued) |
4.4 |
Fair value estimation (Continued) |
As of December 31, 2020 |
Level 1 |
Level 2 |
Level 3 |
Total |
||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Unlisted Securities |
Financial assets at fair value through profit or loss |
|||||||||||||||||
Asset management plans |
— | ||||||||||||||||
Trust plans |
— | ||||||||||||||||
Private fund and other equity investments |
— | ||||||||||||||||
Mutual funds |
— | — | |||||||||||||||
Corporate bonds |
— | ||||||||||||||||
Bank wealth management products |
— | — | |||||||||||||||
Structured deposits |
— | — | |||||||||||||||
Factoring products |
— | — | |||||||||||||||
Derivative instruments |
| ||||||||||||||||
Interest rate swap |
— | ( |
) | — | ( |
) | | ||||||||||
Foreign currency swaps |
— | ( |
) | — | ( |
) | | ||||||||||
|
|
|
|
|
|
|
|
||||||||||
Total |
|||||||||||||||||
|
|
|
|
|
|
|
|
4 |
Financial instruments and risks (Continued) |
4.4 |
Fair value estimation (Continued) |
As of December 31, 2021 |
Level 1 |
Level 2 |
Level 3 |
Total |
||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||
Unlisted Securities |
||||||||||||||||||
Asset management plans |
— | |||||||||||||||||
Trust plans |
— | |||||||||||||||||
Private fund and other equity investments |
— | — | ||||||||||||||||
Mutual funds |
— | — | ||||||||||||||||
Corporate bonds |
— | |||||||||||||||||
Bank wealth management products |
— | — | ||||||||||||||||
Structured deposits |
— | — | ||||||||||||||||
Others debt investments |
— | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Listed Securities |
||||||||||||||||||
Stock |
— | — | ||||||||||||||||
Derivative instruments |
| |||||||||||||||||
Interest rate swap |
— | — | | |||||||||||||||
Foreign currency swap |
— | ( |
) | — | ( |
) | | |||||||||||
|
|
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
Financial assets at fair value through profit or loss |
||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
As of beginning of the year |
||||||||||||
Additions |
||||||||||||
Disposal |
( |
) | ( |
) | ( |
) | ||||||
Transfer into level 3 |
||||||||||||
Transfer out of level 3 |
— | — | ( |
) | ||||||||
|
|
|
|
|
|
|||||||
Gains or losses recognized in profit or loss |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
As of end of the year |
||||||||||||
|
|
|
|
|
|
5 |
Critical accounting estimates and judgements |
5 |
Critical accounting estimates and judgements (Continued) |
5.1 |
Goodwill impairment assessment |
5.2 |
Recognition of loan facilitation and service fees |
5.3 |
Income taxes |
5 |
Critical accounting estimates and judgements (Continued) |
5.4 |
Classification of financial instruments |
5.5 |
Fair value of financial instruments determined using valuation techniques |
5 |
Critical accounting estimates and judgements (Continued) |
5.6 |
Measurement of the expected credit losses |
• | Determining criteria for significant increase in credit risk; |
• | Choosing appropriate models and assumptions for the measurement of ECL; |
• | Establishing the number and relative weightings of forward-looking scenarios for each type of product/market and the associated ECL; and |
• | Establishing groups of similar financial assets for the purposes of measuring ECL. |
5.7 |
Determination of control over the structured entities |
6 |
Retail credit facilitation service fees |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Loan facilitation service |
||||||||||||
Post origination service |
||||||||||||
|
|
|
|
|
|
|||||||
Total |
||||||||||||
|
|
|
|
|
|
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Aggregate amount of the transaction price allocated to long-term contracts that are partially or fully unsatisfied at the end of each year |
||||||||
Expected to be recognized within one year |
||||||||
Expected to be recognized in one to two years |
||||||||
Expected to be recognized in two to three years |
||||||||
|
|
|
|
|||||
|
|
|
|
7 |
Wealth management transaction and service fees |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Current Products |
||||||||||||
Legacy Products |
||||||||||||
|
|
|
|
|
|
|||||||
|
|
|
||||||||||
|
|
|
|
|
|
8 |
Net interest income |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Loans originated by consolidated trust plans |
||||||||||||
Interest income |
||||||||||||
Interest expense |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Net interest income from loans originated by consolidated trust plans |
||||||||||||
|
|
|
|
|
|
|||||||
Loans originated by microloan lending companies and consumer finance company |
||||||||||||
Interest income |
||||||||||||
Interest expense |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Net interest income from loans originated by microloan lending companies and consumer finance company |
||||||||||||
|
|
|
|
|
|
|||||||
Total net interest income |
||||||||||||
|
|
|
|
|
|
9 |
Other income |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Account management service fees |
||||||||||||
Penalty fee income |
||||||||||||
Others |
||||||||||||
|
|
|
|
|
|
|||||||
|
|
|
||||||||||
|
|
|
|
|
|
10 |
Investment income |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Interest income |
||||||||||||
Financial assets at amortized cost |
||||||||||||
Financial assets purchased under reverse repurchase agreements |
— | |||||||||||
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|||||||
Realized gains |
||||||||||||
Financial assets at fair value through profit or loss |
||||||||||||
Financial assets at amortized cost |
— | — | ||||||||||
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|||||||
Net change in unrealized gains/(losses) |
||||||||||||
Financial assets at fair value through profit or loss (Note 17(b)) |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
11 |
Expense by nature |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Employee benefit expenses (Note 11.1) |
||||||||||||
Loan origination and servicing expenses |
||||||||||||
Promotion and advertising expenses |
||||||||||||
Outsourcing service expenses |
||||||||||||
Payment processing expenses |
||||||||||||
Trust management fee |
||||||||||||
Business entertainment expenses |
||||||||||||
Depreciation of right-of-use |
||||||||||||
Taxes and surcharges |
||||||||||||
Depreciation of property and equipment (Note 23) |
||||||||||||
Amortization of intangible assets (Note 24) |
||||||||||||
Others |
||||||||||||
|
|
|
|
|
|
|||||||
Total sales and marketing expenses, general and administrative expenses, operation and servicing expenses, technology and analytics expenses |
||||||||||||
|
|
|
|
|
|
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Sales and marketing expense |
||||||||||||
Borrower acquisition expenses |
||||||||||||
General sales and marketing expenses |
||||||||||||
Investor acquisition and retention expenses |
||||||||||||
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
11 |
Expense by nature (Continued) |
11.1 |
Employee benefit expenses |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Wages, salaries and bonuses |
||||||||||||
Other social security costs, housing benefits and other employee benefits |
||||||||||||
Pension costs – defined contribution plans |
||||||||||||
Share-based payment (Note 42) |
( |
) | ||||||||||
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
12 |
Credit impairment losses |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Financing guarantee contracts |
||||||||||||
Loans to customers |
( |
) | ||||||||||
Accounts and other receivables and contract assets |
||||||||||||
Financial assets at amortized cost |
||||||||||||
Others |
||||||||||||
|
|
|
|
|
|
|||||||
|
|
|
||||||||||
|
|
|
|
|
|
13 |
Finance costs |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Interest expenses on convertible promissory note |
|
|
|
|||||||||
Interest expenses on Convertible Notes |
— | |||||||||||
Interest expenses on borrowings |
||||||||||||
Interest expense on lease liabilities |
||||||||||||
Interest expenses on consolidated wealth management products |
||||||||||||
One-time expenses related to C-round restructuring |
— | — | ||||||||||
Interest expenses on convertible redeemable preferred shares |
— | |||||||||||
Bank interest income |
( |
) | ( |
) | ( |
) | ||||||
14 |
Income tax expenses |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Current income tax |
||||||||||||
Deferred income tax |
( |
) | ||||||||||
14 |
Income tax expenses (Continued) |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Profit before income tax expenses |
||||||||||||
Income tax calculated at the PRC statutory tax rate of 25% |
||||||||||||
Tax effect of: |
||||||||||||
Reversal of deferred tax assets recognized in prior years |
||||||||||||
Differential income tax rates applicable to subsidiaries (Note a, b, c, d and e) |
||||||||||||
Expenses and losses not deductible for tax purposes |
||||||||||||
Deductible temporary differences and tax losses for which no deferred tax asset was recognized |
||||||||||||
Income not subject to tax |
( |
) | ( |
) | ( |
) | ||||||
Utilization of previously unrecognized deferred tax assets |
( |
) | ( |
) | ( |
) | ||||||
Research and development tax credit |
— | ( |
) | ( |
) | |||||||
Effect of tax rate changes on deferred income taxes |
( |
) | — | ( |
) | |||||||
Others |
( |
) | ||||||||||
Income tax expense |
||||||||||||
(a) | Cayman Islands and BVI Income Tax |
14 |
Income tax expenses (Continued) |
(b) | Hong Kong Income Tax |
(c) | Singapore Income Tax |
(d) | Indonesia Income Tax |
(e) | PRC Corporate Income Tax (“CIT”) |
14 |
Income tax expenses (Continued) |
(f) | PRC Withholding Tax (“WHT”) |
15 |
Earnings per share |
(a) | Basic earnings per share is calculated by dividing the profit attributable to owners of the Group by the weighted average number of ordinary shares in issue during the year excluding ordinary shares purchased by the Group. |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Profit attributable to owners of the Company |
||||||||||||
Weighted average number of ordinary shares in issue |
||||||||||||
|
|
|
|
|
|
|||||||
Basic earnings per share (in RMB) |
||||||||||||
|
|
|
|
|
|
|||||||
Basic earnings per ADS (in RMB) |
||||||||||||
|
|
|
|
15 |
Earnings per share (Continued) |
(b) |
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. For the year ended December 31, 2019, the Group has three categories of potential dilutive ordinary shares: convertible promissory note (refer to Note 33), convertible redeemable preferred shares and share options. For the years ended December 31, 2020 and 2021, the Group has four categories of potential dilutive ordinary shares: including convertible promissory note, optionally convertible promissory notes (refer to Note 34), share options and PSUs. |
15 |
Earnings per share (Continued) |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Earnings |
||||||||||||
Profit attributable to owners of the Company |
||||||||||||
Interest expense on convertible instruments, net of tax |
— | |||||||||||
Net profit used to determine diluted earnings per share |
||||||||||||
Weighted average number of ordinary shares |
||||||||||||
Weighted average number of ordinary shares in issue |
||||||||||||
Adjustments for: |
||||||||||||
Assumed conversion of convertible instruments |
— | |||||||||||
Assumed exercise of share options and vesting of PSUs |
— | — | ||||||||||
Weighted average number of ordinary share for diluted earnings per share |
||||||||||||
Diluted earnings per share (in RMB) |
||||||||||||
Diluted earnings per ADS (in RMB) |
||||||||||||
16 |
Cash at bank and restricted cash |
As of December 31, |
||||||||
Cash at bank |
2020 |
2021 |
||||||
RMB’000 |
RMB’000 |
|||||||
Demand deposits |
||||||||
RMB |
||||||||
USD |
||||||||
HKD |
||||||||
IDR |
||||||||
SGD |
||||||||
Time deposits |
||||||||
RMB |
||||||||
USD |
||||||||
IDR |
||||||||
Less: Provision for impairment losses |
( |
) | ( |
) | ||||
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Restricted cash |
||||||||
Cash from consolidated structured entities (a) |
||||||||
Deposits for borrowings (b) |
— | |||||||
Deposits held on behalf of platform investors (c) |
||||||||
Others |
||||||||
(a) |
Cash from consolidated structured entities is the cash held by the Group’s consolidated structured entities collected from platform investors mainly for their upcoming investment in retail credit business. |
(b) |
Deposits for borrowings are pledges for secured borrowings ( refer to Note 29(a)). |
(c) |
Deposits held on behalf of platform investors represents funds received from platform investors while investment decisions are yet to be made, or investors’ funds withdrawal is in processing due to settlement time. |
17 |
Financial assets at fair value through profit or loss |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Unlisted securities |
||||||||
Asset management plans (a) (b) |
||||||||
Structured deposits |
||||||||
Bank wealth management products |
||||||||
Corporate bonds (b) |
||||||||
Trust plans (b) |
||||||||
Private fund and other equity investments |
||||||||
Mutual funds |
||||||||
Factoring products |
— | |||||||
Other debt investments |
— | |||||||
Listed securities |
||||||||
Stock |
— | |||||||
(a) |
In 2019, the Company obtained the creditors’ rights of the loans to one of the Company’s shareholders through an investment in a trust plan, which was collateralized by beneficiary rights of the shares of the Company. As of December 31, 2021, the carrying amount of the trust plan was RMB |
(b) |
As of December 31, 2021, the principal amount of financial assets at fair value through profit or loss amounting to RMB |
18 |
Financial assets at amortized cost |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Unlisted securities |
||||||||
Debt Investments |
||||||||
|
|
|
|
|||||
Interest receivable |
||||||||
|
|
|
|
|||||
Less: Provision for impairment losses |
( |
) | ( |
) | ||||
|
|
|
|
|||||
|
|
|
|
(a) | As of December 31, 2021, the principal amount of financial assets at amortized cost amounting to RMB amount estimated at the balance sheet date. |
(b) | The following table sets forth the movement of gross carrying amount of financial assets at amortized cost for the year ended December 31, 2019: |
Year ended December 31, 2019 |
||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
POCI |
Total |
||||||||||||||||
As of January 1, 2019 |
||||||||||||||||||||
New financial assets originated or purchased |
— |
— |
||||||||||||||||||
Transfers |
( |
) |
— |
— |
— |
|||||||||||||||
— From stage 1 to stage 3 |
( |
) |
— |
— |
— |
|||||||||||||||
Financial assets de-recognized and other adjustments in the current period (including repayments of financial assets) |
( |
) |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
As of December 31, 2019 |
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
18 |
Financial assets at amortized cost (Continued) |
(c) | The following table sets forth the movement of ECL allowance for the year ended December 31, 2019: |
Year ended December 31, 2019 |
||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
POCI |
Total |
||||||||||||||||
As of January 1, 2019 |
||||||||||||||||||||
New financial assets originated or purchased |
— |
— |
( |
) |
||||||||||||||||
Transfers |
( |
) |
— |
— |
||||||||||||||||
— From stage 1 to stage 3 |
( |
) |
— |
10 ,014 |
— |
— |
||||||||||||||
Net impact on expected credit loss by stage transfer |
— |
— |
— |
|||||||||||||||||
Financial assets de-recognized and other adjustments in the current period (including repayments of financial assets) |
( |
) |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||
Change in parameters of expected credit loss model |
( |
) |
— |
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
As of December 31, 2019 |
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
(d) | The following table sets forth the movement of gross carrying amount of financial assets at amortized cost for the year ended December 31, 2020: |
Year ended December 31, 2020 |
||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
POCI |
Total |
||||||||||||||||
As of January 1, 2020 |
— |
|||||||||||||||||||
New financial assets originated or purchased |
— |
— |
||||||||||||||||||
Write-offs |
— |
— |
( |
) |
( |
) |
( |
) | ||||||||||||
Financial assets de-recognized and other adjustments in the current period (including repayments of financial assets) |
( |
) |
— |
( |
) |
( |
) |
( |
) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
As of December 31, 2020 |
— |
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
(e) | The following table sets forth the movement of ECL allowance for the year ended December 31, 2020: |
Year ended December 31, 2020 |
||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
POCI |
Total |
||||||||||||||||
As of January 1, 2020 |
||||||||||||||||||||
New financial assets originated or purchased |
— |
— |
— |
|||||||||||||||||
Write-offs |
— |
— |
( |
) |
( |
) |
( |
) | ||||||||||||
Financial assets de-recognized and other adjustments in the current period (including repayments of financial assets) |
( |
) |
— |
( |
) |
( |
) |
( |
) | |||||||||||
Change in parameters of expected credit loss model |
( |
) |
— |
( |
) |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
As of December 31, 2020 |
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
18 |
Financial assets at amortized cost (Continued) |
(f) | The following table sets forth the movement of gross carrying amount of financial assets at amortized cost for the year ended December 31, 2021: |
Year ended December 31, 2021 |
||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
POCI |
Total |
||||||||||||||||
As of January 1, 2021 |
— |
|||||||||||||||||||
New financial assets originated or purchased |
— |
— |
||||||||||||||||||
Write-offs |
— |
— |
( |
) |
( |
) |
( |
) | ||||||||||||
Disposal in the current period |
— |
— |
( |
) |
— |
( |
) | |||||||||||||
Financial assets de-recognized and other adjustments in the current period (including repayments of financial assets) |
( |
) |
— |
( |
) |
( |
) |
( |
) | |||||||||||
As of December 31, 2021 |
— |
|||||||||||||||||||
(g) | The following table sets forth the movement of ECL allowance for the year ended December 31, 2021: |
Year ended December 31, 2021 |
||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
POCI |
Total |
||||||||||||||||
As of January 1, 2021 |
— |
|||||||||||||||||||
New financial assets originated or purchased |
— |
— |
— |
|||||||||||||||||
Write-offs |
— |
— |
( |
) |
( |
) |
( |
) | ||||||||||||
Disposal in the current period |
— |
— |
( |
) |
— |
( |
) | |||||||||||||
Financial assets de-recognized and other adjustments in the current period (including repayments of financial assets) |
( |
) |
— |
( |
) |
|||||||||||||||
Change in parameters of expected credit loss model |
— |
( |
) |
|||||||||||||||||
As of December 31, 2021 |
— |
|||||||||||||||||||
19 |
Financial assets purchased under reverse repurchase agreements |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Bonds (a) |
||||||||
(a) | The Group enter ed into purchases of assets under reverse repurchase agreements and has not taken physical possession of assets purchased under such agreements. In the event of default by the counterparty to repurchase the assets, the Group has the right to the underlying assets. The difference between the purchasing price and reselling price is recognized as investment income over the term of the agreement using the effective interest method. |
20 |
Accounts and other receivables and contract assets |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Contract acquisition cost |
||||||||
Loan facilitation and service fees |
||||||||
Receivables from external payment services providers (a) |
||||||||
Trust statutory deposits (b) |
||||||||
Wealth management transaction and service fees receivables |
||||||||
— Current Products |
||||||||
— Legacy Products |
||||||||
Receivables for shares repurchase program (Note 37(a)) |
— | |||||||
Other deposit s |
||||||||
Guarantee fee s |
||||||||
Receivables f rom ADS income |
||||||||
Receivables f rom exercise of share options |
— | |||||||
Others |
||||||||
Less: Provision for impairment losses (c) |
( |
) | ( |
) | ||||
(a) | The Group maintains accounts with external online payment services providers to transfer deposits of platform investors, collect principal and interests from borrowers and make loans. The Group recorded the related amounts as receivables from external payment service providers. |
(b) | The balances represent cash deposited in China Trust Protection Fund Co., Ltd. as required by trust regulations. |
(c) | The following table sets forth the movements in the provision for impairment losses: |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
At the beginning of the year |
||||||||||||
Impairment loss recognized in the consolidated statement of comprehensive income |
||||||||||||
Written off during the year |
( |
) | ( |
) | ( |
) | ||||||
Recovery of receivables written off previously |
||||||||||||
At the end of the year |
||||||||||||
20 |
Accounts and other receivables and contract assets (Continued) |
(d) | The loss allowance as of December 31, 2020 was determined as follows for receivables from loan facilitation and service fees, wealth management transaction and service fees receivables and guarantee fee: |
As of December 31, 2020 |
||||||||||||||||
Current |
1-90 days past due |
91-180 dayspast due |
Total |
|||||||||||||
Accounts and other receivables and contract assets |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||
Expected loss rate |
% | % | % | % | ||||||||||||
Loan facilitation and service fee |
||||||||||||||||
Wealth management transaction and service fee receivables |
||||||||||||||||
Guarantee fee |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Loss allowance |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
(e) | The loss allowance as of December 31, 2021 was determined as follows for receivables from loan facilitation and service fees, wealth management transaction and service fees receivables and guarantee fee: |
As of December 31, 2021 |
||||||||||||||||
Current |
1-90 days past due |
91-180 dayspast due |
Total |
|||||||||||||
Accounts and other receivables and contract assets |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||
Expected loss rate |
% | % | % | % | ||||||||||||
Loan facilitation and service fee |
|
|||||||||||||||
Wealth management transaction and service fee receivables |
||||||||||||||||
Guarantee fee |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Loss allowance |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
21 |
Loans to customers |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Loans originated by consolidated trust plans |
||||||||
Loans originated by microloan lending companies and consumer finance company |
||||||||
Interest receivable |
||||||||
Less: Provision for impairment losses |
||||||||
Stage 1 |
( |
) | ( |
) | ||||
Stage 2 |
( |
) | ( |
) | ||||
Stage 3 |
( |
) | ( |
) | ||||
( |
) | ( |
) | |||||
|
|
|
|
|||||
|
|
|
|
(a) |
As of December 31, 2020 and 2021, loans amounting to RMB105,325 million and RMB162,417 million, respectively, were covered by credit enhancement provided by credit enhancement partners. Out of which, the majority of the balance were covered by credit insurance provided by Ping An Property and Casualty Insurance Company (“Ping An P&C”), a subsidiary of Ping An Group. Credit enhancement partners independently underwrite the borrowers and entered into the credit enhancement agreements either in the form of credit insurance or financial guarantee directly with the borrowers. The beneficiaries of such credit enhancement are the institutional funding partners who provide funding to the borrowers. |
(b) |
As of December 31, 2020, part of the loan balance was related to loans from asset based securitization plans. These loans were originated by microloan lending companies within the Group that do not meet the criteria of derecognition as the Group continued to provide credit enhancement to the assets backed securitization plans. The asset based securitization plans represented a liability of the Group and were recorded as payable to investors of consolidated structured entities (refer to Note 31) in the consolidated financial statements, which consisted of principal and accrued interests. As of December 31, 2021, no loan balance was related to loans from asset based securization plans. |
(c) |
For the years ended December 31, 2019, 2020 and 2021, the amounts of concession provided to customers were not material. |
21 |
Loans to customers (Continued) |
(d) | The following table sets forth the movement of gross carrying amount of loans to customers for the year ended December 31, 2019: |
Year ended December 31, 2019 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2019 |
||||||||||||||||
New loans originated |
— | — | ||||||||||||||
Transfer s |
( |
) | — | |||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 1 to stage 3 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 3 |
— | ( |
) | — | ||||||||||||
— From stage 3 to stage 2 |
— | ( |
) | — | ||||||||||||
Loans de-recognized and other adjustments in the current period (including repayments of loans) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Write-offs |
— | — | ( |
) | ( |
) | ||||||||||
As of December 31, 2019 |
||||||||||||||||
(e) | The following table sets forth the movement of ECL allowance for the year ended December 31, 2019: |
Year ended December 31, 2019 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2019 |
|
|
|
|||||||||||||
New loans originated |
— | — | ||||||||||||||
Transfer s |
( |
) | ( |
) | ||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 1 to stage 3 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 3 |
— | ( |
) | — | ||||||||||||
— From stage 3 to stage 2 |
— | ( |
) | — | ||||||||||||
Net impact on expected credit loss by stage transfers |
( |
) | ||||||||||||||
Loans de-recognized and other adjustments in the current period (including repayments of loans) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Change in parameters of expected credit loss model |
( |
) | ||||||||||||||
Write-offs |
— | — | ( |
) | ( |
) | ||||||||||
As of December 31, 2019 |
||||||||||||||||
21 |
Loans to customers (Continued) |
(f) | The following table sets forth the movement of gross carrying amount of loans to customers for the year ended December 31, 2020: |
Year ended December 31, 2020 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2020 |
||||||||||||||||
New loans originated |
— | — | ||||||||||||||
Transfer s |
( |
) | — | |||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 1 to stage 3 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 3 |
— | ( |
) | — | ||||||||||||
— From stage 3 to stage 2 |
— | ( |
) | — | ||||||||||||
Loans de-recognized and other adjustments in the current period (including repayments of loans) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Write-offs |
— | — | ( |
) | ( |
) | ||||||||||
As of December 31, 2020 |
||||||||||||||||
(g) | The following table sets forth the movement of ECL allowance for the year ended December 31, 2020: |
Year ended December 31, 2020 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2020 |
|
|
||||||||||||||
New loans originated |
— | — | ||||||||||||||
Transfer s |
( |
) | |
|||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 1 to stage 3 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 3 |
— | ( |
) | — | ||||||||||||
— From stage 3 to stage 2 |
— | ( |
) | — | ||||||||||||
Net impact on expected credit loss by stage transfer s |
( |
) | ||||||||||||||
Loans de-recognized and other adjustments in the current period (including repayments of loans) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Change in parameters of expected credit loss model |
( |
) | ||||||||||||||
Write-offs |
— | — | ( |
) | ( |
) | ||||||||||
Recovery of loans written off previously |
— | — | ||||||||||||||
As of December 31, 2020 |
||||||||||||||||
21 |
Loans to customers (Continued) |
(h) | The following table sets forth the movement of gross carrying amount of loans to customers for the year ended December 31, 2021: |
Year ended December 31, 2021 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2021 |
||||||||||||||||
New loans originated |
— | — | ||||||||||||||
Transfer s |
( |
) | — | |||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 3 |
— | ( |
) | — | ||||||||||||
— From stage 3 to stage 2 |
— | ( |
) | — | ||||||||||||
Loans de-recognized and other adjustments in the current period (including repayments of loans) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Write-offs |
— | — | ( |
) | ( |
) | ||||||||||
As of December 31, 2021 |
||||||||||||||||
(i) | The following table sets forth the movement of ECL allowance for the year ended December 31, 2021: |
Year ended December 31, 2021 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2021 |
||||||||||||||||
New loans originated |
|
— | — | |
||||||||||||
Transfer s |
( |
) | |
|||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 3 |
— | ( |
) | — | ||||||||||||
— From stage 3 to stage 2 |
— | ( |
) | — | ||||||||||||
Net impact on expected credit loss by stage transfers |
( |
) | ||||||||||||||
Loans de-recognized and other adjustments in the current period (including repayments of loans) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Change in parameters of expected credit loss model |
||||||||||||||||
Write-offs |
— | — | ( |
) | ( |
) | ||||||||||
Recovery of loans written off previously |
— | — | ||||||||||||||
As of December 31, 2021 |
||||||||||||||||
22 |
Deferred tax assets and deferred tax liabilities |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Deferred tax assets |
||||||||
Deferred tax liabilities |
( |
) | ( |
) | ||||
Net amount |
( |
) | ||||||
(a) | The following table sets forth the details of deferred tax assets: |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Revenue recognition - differences between accounting and tax book |
— | |||||||
Provision for asset impairments |
||||||||
Employee benefit payables |
||||||||
Guarantee liabilities |
||||||||
Accrued expenses |
||||||||
Deductible tax losses |
||||||||
Changes in fair value |
||||||||
Consolidation adjustments |
||||||||
Unexercised share-based payment |
||||||||
Others |
||||||||
22 |
Deferred tax assets and deferred tax liabilities (Continued) |
(b) | Deductible temporary differences and deductible losses that are not recognized as deferred tax assets are analyzed as follows: |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Deductible temporary differences |
||||||||
Deductible losses |
||||||||
(c) | Deductible losses that are not recognized as deferred tax assets will expire as follows: |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
2021 |
— | |||||||
2022 |
||||||||
2023 |
||||||||
2024 |
||||||||
2025 |
||||||||
2026 |
— | |||||||
No due date |
||||||||
(d) | The following table sets forth the movements of the deferred tax asset: |
Movements |
Deductible tax losses |
Provision for asset impairments |
Employee benefit payables |
Accrued expenses |
Unexercised share-based payment |
Guarantee liabilities |
Advertising and business promotion fees |
Revenue recognition - differences between accounting and tax book |
Others (Include changes in fair value ) |
Total |
||||||||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||||||||
As of January 1, 2019 |
— |
|||||||||||||||||||||||||||||||||||||||
Credited/(charged) - to profit or loss |
( |
) | ( |
) | ( |
) | ( |
) | — | ( |
) | ( |
) | |||||||||||||||||||||||||||
As of December 31, 2019 |
— |
|||||||||||||||||||||||||||||||||||||||
Credited/(charged) - to profit or loss |
( |
) | ( |
) | — | |||||||||||||||||||||||||||||||||||
As of December 31, 2020 |
— |
|||||||||||||||||||||||||||||||||||||||
Credited/(charged) - to profit or loss |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||||
As of December 31, 2021 |
— |
|||||||||||||||||||||||||||||||||||||||
22 |
Deferred tax assets and deferred tax liabilities (Continued) |
(e) | The following table sets forth for the details of deferred tax liabilities: |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Unrealized consolidated earnings |
||||||||
Intangible assets arisen from business combination |
||||||||
Changes in fair value |
||||||||
Effective interest adjustment |
||||||||
Depreciation of property and equipment |
||||||||
Revenue recognition differences between accounting and tax book |
— | |||||||
(f) | The following table sets forth the movements of the deferred tax liabilities: |
Movements |
Revenue recognition differences between accounting and tax book |
Intangible assets arisen from business combination |
Unrealized consolidated earnings |
Effective interest adjustment |
Changes in fair value |
Depreciation of property and equipment |
Total |
|||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||||||||
As of January 1, 2019 |
||||||||||||||||||||||||||||
Charged/(credited) - to profit or loss |
( |
) | ( |
) | ( |
) | ||||||||||||||||||||||
As of December 31, 2019 |
||||||||||||||||||||||||||||
Charged/(credited) - to profit or loss |
( |
) | ||||||||||||||||||||||||||
As of December 31, 2020 |
||||||||||||||||||||||||||||
Charged/(credited) - to profit or loss |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||
As of December 31, 2021 |
— |
|||||||||||||||||||||||||||
22 |
Deferred tax assets and deferred tax liabilities (Continued) |
(g) | The following table sets forth the net balances of deferred tax assets and liabilities after offsetting: |
As of December 31, |
||||||||||||||||
2020 |
2021 |
|||||||||||||||
Offset amount |
Balance after offsetting |
Offset amount |
Balance after offsetting |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Deferred tax assets |
( |
) | ( |
) | ||||||||||||
Deferred tax liabilities |
( |
) | ( |
) | ||||||||||||
23 |
Property and equipment |
Buildings, office and electrical equipment, motor vehicles |
Leasehold improvements |
Development in progress |
Total |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
As of January 1, 2019 |
||||||||||||||||
Cost |
||||||||||||||||
Accumulated depreciation |
( |
) | ( |
) | — | ( |
) | |||||||||
Net book amount |
||||||||||||||||
Year ended December 31, 2019 |
||||||||||||||||
Opening net book amount |
||||||||||||||||
Additions |
— | |||||||||||||||
Transfers |
— | ( |
) | — | ||||||||||||
Disposals |
( |
) | — | — | ( |
) | ||||||||||
Depreciation charge |
( |
) | ( |
) | — | ( |
) | |||||||||
Closing net book amount |
— | |||||||||||||||
As of December 31, 2019 |
||||||||||||||||
Cost |
— | |||||||||||||||
Accumulated depreciation |
( |
) | ( |
) | — | ( |
) | |||||||||
Net book amount |
— | |||||||||||||||
23 |
Property and equipment (Continued) |
Buildings, office and electrical equipment, motor vehicles |
Leasehold improvements |
Development in progress |
Total |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
As of January 1, 2020 |
||||||||||||||||
Cost |
— | |
||||||||||||||
Accumulated depreciation |
( |
) | ( |
) | — | ( |
) | |||||||||
Net book amount |
— | |||||||||||||||
Year ended December 31, 2020 |
||||||||||||||||
Opening net book amount |
— | |||||||||||||||
Additions |
— | |||||||||||||||
Disposals |
( |
) | ( |
) | — | ( |
) | |||||||||
Depreciation charge |
( |
) | ( |
) | — | ( |
) | |||||||||
Closing net book amount |
— | |||||||||||||||
As of December 31, 2020 |
||||||||||||||||
Cost |
— | |||||||||||||||
Accumulated depreciation |
( |
) | ( |
) | — | ( |
) | |||||||||
Net book amount |
— | |||||||||||||||
Buildings, office and electrical equipment, motor vehicles |
Leasehold improvements |
Development in progress |
Total |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
As of January 1, 2021 |
||||||||||||||||
Cost |
— | |||||||||||||||
Accumulated depreciation |
( |
) | ( |
) | — | ( |
) | |||||||||
Net book amount |
— | |||||||||||||||
Year ended December 31, 2021 |
||||||||||||||||
Opening net book amount |
— | |||||||||||||||
Additions |
— | |||||||||||||||
Disposals |
( |
) | ( |
) | — | ( |
) | |||||||||
Depreciation charge |
( |
) | ( |
) | — | ( |
) | |||||||||
Closing net book amount |
— | |||||||||||||||
As of December 31, 2021 |
||||||||||||||||
Cost |
— | |||||||||||||||
Accumulated depreciation |
( |
) | ( |
) | — | ( |
) | |||||||||
Net book amount |
— | |||||||||||||||
24 |
Intangible assets |
Trademarks and licenses |
Computer software and others |
Development in progress |
Total |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
As of January 1, 2019 |
||||||||||||||||
Cost |
||||||||||||||||
Accumulated amortization |
( |
) | ( |
) | — | ( |
) | |||||||||
Net book amount |
||||||||||||||||
Year ended December 31, 2019 |
||||||||||||||||
Opening net book amount |
||||||||||||||||
Additions |
— | — | ||||||||||||||
Transfer |
— | ( |
) | — | ||||||||||||
Impairment |
— | ( |
) | — | ( |
) | ||||||||||
Amortization charge |
( |
) | ( |
) | — | ( |
) | |||||||||
Closing net book amount |
— | |||||||||||||||
As of December 31, 2019 |
||||||||||||||||
Cost |
— | |||||||||||||||
Accumulated amortization |
( |
) | ( |
) | — | ( |
) | |||||||||
Impairment |
— | ( |
) | — | ( |
) | ||||||||||
Net book amount |
— | |||||||||||||||
Trademarks and licenses |
Computer software and others |
Development in progress |
Total |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
As of January 1, 2020 |
||||||||||||||||
Cost |
|
— | ||||||||||||||
Accumulated amortization |
( |
) | ( |
) | — | ( |
) | |||||||||
Impairment |
— | ( |
) | — | ( |
) | ||||||||||
Net book amount |
— | |||||||||||||||
Year ended December 31, 2020 |
||||||||||||||||
Opening net book amount |
— | |||||||||||||||
Additions |
— | — | ||||||||||||||
Amortization charge |
— | ( |
) | — | ( |
) | ||||||||||
Closing net book amount |
— | |||||||||||||||
As of December 31, 2020 |
||||||||||||||||
Cost |
— | |||||||||||||||
Accumulated amortization |
( |
) | ( |
) | — | ( |
) | |||||||||
Impairment |
— | ( |
) | — | ( |
) | ||||||||||
Net book amount |
— | |||||||||||||||
24 |
Intangible assets (Continued) |
Trademarks and licenses |
Computer software and others |
Development in progress |
Total |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
As of January 1, 2021 |
||||||||||||||||
Cost |
|
— | ||||||||||||||
Accumulated amortization |
( |
) | ( |
) | — | ( |
) | |||||||||
Impairment |
— | ( |
) | — | ( |
) | ||||||||||
Net book amount |
— | |||||||||||||||
Year ended December 31, 2021 |
||||||||||||||||
Opening net book amount |
— | |||||||||||||||
Additions |
— | — | ||||||||||||||
Impairment |
( |
) | — | — | ( |
) | ||||||||||
Amortization charge |
— | ( |
) | — | ( |
) | ||||||||||
Closing net book amount |
— | |||||||||||||||
As of December 31, 2021 |
||||||||||||||||
Cost |
— | |||||||||||||||
Accumulated amortization |
( |
) | ( |
) | — | ( |
) | |||||||||
Impairment |
( |
) | ( |
) | — | ( |
) | |||||||||
Net book amount |
— | |||||||||||||||
25 |
Leases |
(a) | Amounts recognized in the statement of financial position |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
Right-of-use |
RMB’000 |
RMB’000 |
||||||
Properties |
||||||||
Lease liabilities |
||||||||
(b) | Amounts recognized in the statement of profit or loss |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
Depreciation charge of right-of-use |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||
Properties |
||||||||||||
Interest expense (included in finance costs) |
||||||||||||
Expense relating to short-term leases (included in operation and servicing expenses; general and administrative expenses; technology and analytics expenses; sales and marketing expenses) |
||||||||||||
Expense relating to leases of low-value assets (included in operation and servicing expenses; general and administrative expenses; technology and analytics expenses; sales and marketing expenses) |
(c) | The Group’s leasing activities and how these are accounted for |
25 |
Leases (Continued) |
(d) | Movement of right-of-use |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Opening net book amount |
||||||||||||
Additions |
||||||||||||
Early termination |
— | ( |
) | ( |
) | |||||||
Depreciation charge |
( |
) | ( |
) | ( |
) | ||||||
Closing net book amount |
||||||||||||
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Cost |
||||||||
Accumulated depreciation |
( |
) | ( |
) | ||||
Net book amount |
||||||||
26 |
Goodwill |
As of January 1, 2019 |
Increase |
Decrease |
As of December 31, 2019 |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Puhui |
— | — | ||||||||||||||
Tianjin Guarantee |
— | — | ||||||||||||||
Pingan Jixin |
— | — | ||||||||||||||
Lu International (Hong Kong) Limited |
— | — | ||||||||||||||
Yunque Dongfang |
— | — | ||||||||||||||
Jinniu Loan |
— | — | ||||||||||||||
— | ||||||||||||||||
Less: Impairment losses |
( |
) | ( |
) | — | ( |
) | |||||||||
( |
) | — | ||||||||||||||
As of January 1, 2020 |
Increase |
Decrease |
As of December 31, 2020 |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Puhui |
— | — | |
|||||||||||||
Tianjin Guarantee |
— | — | ||||||||||||||
Pingan Jixin |
— | — | ||||||||||||||
Lu International (Hong Kong) Limited |
— | — | ||||||||||||||
Yunque Dongfang |
— | — | ||||||||||||||
Jinniu Loan |
— | — | ||||||||||||||
— | ||||||||||||||||
Less: Impairment losses |
( |
) | — | ( |
) | |||||||||||
— | ||||||||||||||||
26 |
Goodwill (Continued) |
As of January 1, 2021 |
Increase |
Decrease |
As of December 31, 2021 |
|||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Puhui |
— | — | ||||||||||||||
Tianjin Guarantee |
— | — | ||||||||||||||
Pingan Jixin |
— | — | ||||||||||||||
Lu International (Hong Kong) Limited |
— | — | ||||||||||||||
Yunque Dongfang |
— | — | ||||||||||||||
Jinniu Loan |
— | — | ||||||||||||||
— | ||||||||||||||||
Less: Impairment losses |
( |
) | ( |
) | — | ( |
) | |||||||||
( |
) | — | ||||||||||||||
As of December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
Discount rates |
% | % | % | |||||||||
Growth rates |
% | % | % |
27 |
Other assets |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Prepaid income tax |
||||||||
Recoverable value-added tax |
||||||||
Prepayments |
||||||||
Derivative financial assets (a) |
||||||||
Repossessed assets |
||||||||
Deferred expenses |
||||||||
Others |
||||||||
Less: Provisions for impairment |
( |
) | ( |
) | ||||
(a) | Interest rate swap |
As of December 31, 2021 |
||||
Carrying amount |
RMB |
|||
Notional amount |
USD |
|||
Maturity date |
3 | |||
Pay type |
||||
Receive type |
28 |
Payable to platform investors |
29 |
Borrowings |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Secured |
||||||||
- Bank borrowings (a) |
||||||||
Unsecured |
||||||||
- Bank borrowings (b) |
|
|||||||
- Corporate borrowings |
||||||||
Interest payable |
||||||||
Total borrowings |
||||||||
(a) | The bank borrowings were secured by deposits amounting to approximately USD per annum, and the terms range from twelve months to twenty-four months (refer to Note 16(b)). |
(b) | As of December 31, 2021, the Group had USD |
(c) |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
Bank borrowings - fixed rate |
% | % | ||||||
Bank borrowings - floating rate |
% | % | ||||||
Corporate borrowings - fixed rate |
% | % | ||||||
30 |
Accounts and other payables and contract liabilities |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Employee benefit payable |
|
|||||||
Contract liabilities from retail credit facilitation service |
||||||||
Tax payable |
||||||||
Payable to cooperation bank s (a) |
||||||||
Payable to investees |
||||||||
Trust management fee |
||||||||
Payable to external suppliers |
||||||||
Cash compensation of Class C ordinary shares restructing |
||||||||
Others |
||||||||
(a) | Payable to cooperation banks is related to the restricted cash that generated from risk sharing business with banks. Under such business, the Group provides loan facilitation services for loans originated by banks and is paid a variable fee determined based on the performance of underlying loans facilitated by the Group. On a monthly basis, the Group receives a fixed service fee from the cooperation banks based on a fixed percentage of loans originated in restricted cash accounts. The service fee will be adjusted based on actual performance of the loans originated under this business upon matrurity. |
31 |
Payable to investors of consolidated structured entities |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Payable to investors of consolidated trust plans |
||||||||
Payable to investors of consolidated wealth management plans |
||||||||
Payable to investors of asset based securitization plans (Note 21(b)) |
— | |||||||
32 |
Financing guarantee liabilities |
(a) | The following table sets forth the movement of gross carrying amount of financing guarantee contracts for the year ended December 31, 2019: |
Year ended December 31, 2019 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2019 |
|
— | |
|||||||||||||
New guarantee contracts originated |
— | — | ||||||||||||||
Transfer s |
( |
) | — | — | ||||||||||||
— From stage 1 to stage 2 |
( |
) | |
— | — | |||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
Guarantee liabilities de-recognized and other adjusted in the current period (including repayments of loans and guarantee payments) |
( |
) | ( |
) | — | ( |
) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
As of December 31, 2019 |
— | |||||||||||||||
|
|
|
|
|
|
|
|
(b) | The following table sets forth the movement of ECL allowance of financing guarantee contracts for the year ended December 31, 2019: |
Year ended December 31, 2019 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2019 |
|
|
— | |
||||||||||||
New guarantee contracts originated |
— | — | ||||||||||||||
Transfer s |
( |
) | — | |||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
Net impact on expected credit loss by stage transfers |
( |
) | — | |||||||||||||
Guarantee liabilities de-recognized and other adjusted in the current period (including repayments of loans and guarantee payments) |
( |
) | ( |
) | — | ( |
) | |||||||||
Change in parameters of expected credit loss model |
( |
) | — | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
As of December 31, 2019 |
— | |||||||||||||||
|
|
|
|
|
|
|
|
32 |
Financing guarantee liabilities (Continued) |
(c) | The following table sets forth the movement of gross carrying amount of financing guarantee contracts for the year ended December 31, 2020: |
Year ended December 31, 2020 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2020 |
— | |||||||||||||||
New guarantee contracts originated |
|
— | — | |
||||||||||||
Transfer s |
( |
) | — | — | ||||||||||||
— From stage 1 to stage 2 |
( |
) | |
— | — | |||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
Guarantee liabilities de-recognized and other adjusted in the current period (including repayments of loans and guarantee payments) |
( |
) | ( |
) | — | ( |
) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
As of December 31, 2020 |
— | |||||||||||||||
|
|
|
|
|
|
|
|
(d) | The following table sets forth the movement of ECL allowance of financing guarantee contracts for the year ended December 31, 2020: |
Year ended December 31, 2020 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
As of January 1, 2020 |
— | |
||||||||||||||
New guarantee contracts originated |
|
— | — | |
||||||||||||
Transfer s |
( |
) | |
— | ||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
Net impact on expected credit loss by stage transfer s |
( |
) | — | |||||||||||||
Guarantee liabilities de-recognized and other adjusted in the current period (including repayments of loans and guarantee payments) |
( |
) | ( |
) | — | ( |
) | |||||||||
Change in parameters of expected credit loss model |
— | |||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
As of December 31, 2020 |
— | |||||||||||||||
|
|
|
|
|
|
|
|
32 |
Financing guarantee liabilities (Continued) |
(e) | The following table sets forth the movement of gross carrying amount of financing guarantee contracts for the year ended December 31, 2021: |
Year ended December 31, 2021 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
Total |
|||||||||||||
As of January 1, 2021 |
— | |||||||||||||||
New guarantee contracts originated |
— | — | ||||||||||||||
Transfer s |
( |
) | — | — | ||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
Guarantee liabilities de-recognized and other adjusted in the current period (including repayments of loans and guarantee payments) |
( |
) | ( |
) | — | ( |
) | |||||||||
As of December 31, 2021 |
— | |||||||||||||||
(f) | The following table sets forth the movement of ECL allowance of financing guarantee contracts for the year ended December 31, 2021: |
Year ended December 31, 2021 |
||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||
Stage 1 |
Stage 2 |
Stage 3 |
Total |
|||||||||||||
As of January 1, 2021 |
— | |||||||||||||||
New guarantee contracts originated |
|
— | — | |
||||||||||||
Transfer s |
( |
) | |
— | ||||||||||||
— From stage 1 to stage 2 |
( |
) | — | — | ||||||||||||
— From stage 2 to stage 1 |
( |
) | — | — | ||||||||||||
Net impact on expected credit loss by stage transfers |
( |
) | — | |||||||||||||
Guarantee liabilities de-recognized and other adjusted in the current period (including repayments of loans and guarantee payments) |
( |
) | ( |
) | — | ( |
) | |||||||||
Change in parameters of expected credit loss model |
— | |||||||||||||||
As of December 31, 2021 |
— | |||||||||||||||
33 |
Convertible promissory note payable |
33 |
Convertible promissory note payable (Continued) |
Liabilities |
Equity |
|||||||
RMB’000 |
RMB’000 |
|||||||
Carrying value as of January 1, 2019 |
||||||||
Interest accrued at effective interest rate |
— | |||||||
Interest paid |
( |
) | — | |||||
Exchange differences |
— | |||||||
Carrying value as of December 31, 2019 |
||||||||
Interest accrued at effective interest rate |
— | |||||||
Interest paid |
( |
) | — | |||||
Exchange differences |
( |
) | — | |||||
Carrying value as of December 31, 2020 |
||||||||
Interest accrued at effective interest rate |
— | |||||||
Interest paid |
( |
) | — | |||||
Exchange differences |
( |
) | — | |||||
Carrying value as of December 31, 2021 |
||||||||
34 |
Optionally convertible promissory notes |
34 |
Optionally convertible promissory notes (Continued) |
Liabilities |
Equity |
|||||||
RMB’000 |
RMB’000 |
|||||||
Initial recognition upon C-round restructuring |
||||||||
Interest accrued at effective interest rate |
— | |||||||
Exchange differences |
( |
) | — | |||||
Carrying value as of December 31, 2020 |
||||||||
Interest accrued at effective interest rate |
— | |||||||
Interest paid |
( |
) | — | |||||
Exchange differences |
( |
) | — | |||||
Carrying value as of December 31, 2021 |
||||||||
35 |
Other liabilities |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Accrued expenses |
||||||||
Derivative financial liabilities (a), (b) |
||||||||
Provisions |
||||||||
Others |
||||||||
|
|
|
|
|||||
|
|
|
|
(a) | Foreign currency swaps |
As of December 31, |
||||||||||||
2020 |
2021 |
|||||||||||
Carrying amount |
RMB |
RMB |
RMB |
|||||||||
Notional amount |
RMB |
USD |
USD |
|||||||||
Maturity date |
30/08/2021- |
|||||||||||
Pay side |
||||||||||||
Receive side |
(b) | Interest rate swap |
As of December 31, 2020 |
||||
Carrying amount |
RMB |
|||
Notional amount |
USD |
|||
Maturity date |
||||
Pay type |
||||
Receive type |
36 |
Share capital and share premium |
Class A ordinary share |
Class B ordinary share (a) |
Ordinary share |
||||||||||||||||||||||||||||||||||
Number of shares |
Share capital |
Share premium |
Number of shares |
Share capital |
Share premium |
Number of shares |
Share capital |
Share premium |
||||||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||||||||
As of January 1, 2019 |
— | — | — | |||||||||||||||||||||||||||||||||
Issuance of ordinary shares |
— | — | — | — | — | — | — | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
As of December 31, 2019 |
— | — | — | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Conversion of Class B ordinary shares and Class C ordinary shares to Class A ordinary shares (b) |
( |
) | ( |
) | ( |
) | — | — | — | |||||||||||||||||||||||||||
Re-designation and reclassification of Class A ordinary shares into ordinary shares (c) |
( |
) | ( |
) | ( |
) | — | — | — | |||||||||||||||||||||||||||
Issuance of ordinary shares upon IPO and exercise of over-allotment option (d) |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
Conversion of automatically convertible promissory notes to ordinary shares (e) |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
As of December 31, 2020 |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Retirement of ordinary shares (f) |
— | — | — | — | — | — | ( |
) | ( |
) | — | |||||||||||||||||||||||||
Issuance of ordinary shares for share-based payment (g) |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Exercise of share-based payment |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
As of December 31, 2021 |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36 |
Share capital and share premium (Continued) |
(a) | Besides the liquidation preference, holders of Class B ordinary shares were entitled to voting rights and dividend rights similar to Class A ordinary shareholders. Class B ordinary shares were automatically converted into Class A ordinary shares upon the occurrence of a qualified listing. |
(b) | Immediately prior to the Company’s successful IPO on October 30, 2020, all of the Company’s then issued and outstanding one-for-one |
(c) | Immediately prior to the Company’s successful IPO on October 30, 2020, all of the Company’s then issued and outstanding re-designated and reclassified into ordinary shares. |
(d) | On October 30, 2020, the Company issued and sold |
(e) | Upon successful IPO on October 30, 2020, the automatically convertible promissory notes were automatically converted into |
(f) | The Company’s board of directors previously designated Tun Kung Company Limited, a principal shareholder of the Company, as the entity to hold |
(g) | The Company issued , which amounts to RMB . |
37 |
Treasury shares |
Shares |
Amount |
|||||||
RMB’000 |
||||||||
As of January 1, 2019 |
||||||||
Issuance of ordinary shares for share-based payment |
||||||||
As of December 31, 2019 |
||||||||
As of December 31, 2020 |
||||||||
Repurchase of ordinary shares (a) |
||||||||
Retirement of ordinary shares (Note 36(f)) |
( |
) | ( |
) | ||||
Issuance of ordinary shares for share-based payment (Note 36(g)) |
— |
|||||||
Exercise of share-based payment (b) |
( |
) | — |
|||||
As of December 31, 2021 |
||||||||
(a) | In 2021, the Company’s board of directors authorized share repurchase programs under which the Company could repurchase up to an aggregate of USDa specific period of time . As of December 31, 2021, the Company had repurchased |
(b) |
As of December 31, 2021, |
38 |
Other reserves |
Employee share-based compensation reserve |
Translation differences |
General reserve |
Value of conversion rights - convertible redeemable preferred shares |
Value of conversion rights – convertible promissory note (Note 33) |
Capital reserve and others |
Total |
||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||||||||
As of January 1, 2019 |
( |
) |
( |
) |
||||||||||||||||||||||||
Issuance of convertible redeemable preferred shares |
— | — | — |
— | — | |||||||||||||||||||||||
Foreign operation translation difference |
— | ( |
) | — |
— | — | — | ( |
) | |||||||||||||||||||
Appropriation to general reserve |
— | — | — | — | — | |||||||||||||||||||||||
Share-based payment |
( |
) | — | — | — | — | — | ( |
) | |||||||||||||||||||
As of December 31, 2019 |
( |
) |
( |
) |
||||||||||||||||||||||||
Employee share-based compensation reserve |
Translation differences |
General reserve |
Value of conversion rights - optionally convertible promissory notes (Note 34) |
Value of conversion rights - convertible redeemable preferred shares |
Value of conversion rights – convertible promissory note (Note 33) |
Capital reserve and others |
Total |
|||||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
|||||||||||||||||||||||||
As of January 1, 2020 |
( |
) |
( |
) |
||||||||||||||||||||||||||||
C-round restructuring |
— | — | — | ( |
) | — | ||||||||||||||||||||||||||
Conversion of Class C ordinary shares to ordinary shares upon IPO |
— | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||
Foreign operation translation difference |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Appropriation to general reserve |
— | — | — | — | — | — | ||||||||||||||||||||||||||
Share-based payment |
— | — | — | — | — | — | ||||||||||||||||||||||||||
As of December 31, 2020 |
( |
) |
||||||||||||||||||||||||||||||
Employee share-based compensation reserve |
Translation differences |
General reserve |
Value of conversion rights - optionally convertible promissory notes (Note 34) |
Value of conversion rights – convertible promissory note (Note 33) |
Capital reserve and others |
Total |
||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||||||||
As of January 1, 2021 |
( |
) |
||||||||||||||||||||||||||
Exercise of share-based payment |
( |
) | — | — | — | — | — | ( |
) | |||||||||||||||||||
Foreign operation translation difference |
— | — | — | — | — | |||||||||||||||||||||||
Appropriation to general reserve |
— | — | — | — | — | |||||||||||||||||||||||
Share-based payment |
— | — | — | — | — | |||||||||||||||||||||||
Acquisition of non-controlling interests of a subsidiary |
— | — | — | — | — | |||||||||||||||||||||||
As of December 31, 2021 |
( |
) |
||||||||||||||||||||||||||
39 |
Retained earnings |
40 |
Commitment |
(a) | Financing guarantee commitments |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Financing guarantee commitments |
||||||||
41 |
Note to consolidated statements of cash flows |
(a) | Reconciliation from profit before income tax expenses to cash generated from operating activities: |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Profits before income tax |
||||||||||||
Adjustments for: |
||||||||||||
Depreciation of property and equipment |
||||||||||||
Depreciation of right-of-use |
||||||||||||
Amortization of intangible assets |
||||||||||||
Share of loss/(profit) of associates and joint ventures |
( |
) | ( |
) | ||||||||
Net gains on sale of property and equipment, and intangible assets |
||||||||||||
Net unrealized losses on financial assets at fair value through profit or loss |
||||||||||||
Non-cash employee benefits expense—share based payment |
( |
) | ||||||||||
Asset impairment losses |
||||||||||||
Credit impairment losses |
||||||||||||
Finance cost classified as financing activities |
||||||||||||
Investment income classified as investing activities |
( |
) | ( |
) | ( |
) | ||||||
Foreign exchange losses/(gains) |
( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|||||||
Change in operating assets and liabilities, net of effects from purchase of controlled entity: |
||||||||||||
Increase in loans to customers and accounts and other receivables |
( |
) | ( |
) | ( |
) | ||||||
Increase in accounts and other payables |
||||||||||||
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
41 |
Note to consolidated statements of cash flows (Continued) |
(b) | Net decrease in cash and cash equivalents |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Cash and cash equivalents at the end of the year |
|
|
||||||||||
Less: Cash and cash equivalents at the beginning of the year |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Net increase/(decrease) in cash and cash equivalents |
( |
) | ||||||||||
|
|
|
|
|
|
(c) | Cash and cash equivalents |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Cash at bank (Note 16) |
|
|
|
|||||||||
Less: Time deposits with original maturities of more than 3 months |
( |
) | ( |
) | ( |
) | ||||||
Add: Provision for impairment losses |
||||||||||||
|
|
|
|
|
|
|||||||
Cash and cash equivalents at the end of the year |
|
|||||||||||
|
|
|
|
|
|
(d) | Net debt reconciliation |
41 |
Note to consolidated statements of cash flows (Continued) |
( d ) |
Net debt reconciliation (Continued) |
Borrowings |
Bond payable |
Convertible promissory note payable |
Convertible redeemable preferred shares |
Lease liabilities |
Optionally convertible promissory note |
Total |
||||||||||||||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||||||||||||||
As of January 1, 2019 |
— | |||||||||||||||||||||||||||
Cash flows |
( |
) | ( |
) | ( |
) | ( |
) | — | ( |
) | |||||||||||||||||
Acquisitions-leases |
— | — | — | — | — | |||||||||||||||||||||||
Foreign exchange adjustments |
— | — | — | |||||||||||||||||||||||||
Accrued expense |
— | |||||||||||||||||||||||||||
As of December 31, 2019 |
— | |||||||||||||||||||||||||||
Cash flows |
— | ( |
) | ( |
) | ( |
) | — | ||||||||||||||||||||
C-round restructuring |
— | — | — | ( |
) | — | ( |
) | ||||||||||||||||||||
Conversion of Class C ordinary shares to ordinary shares upon IPO |
— | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||
Acquisitions-leases |
— | — | — | — | — | |||||||||||||||||||||||
Disposals-leases |
— | — | — | — | ( |
) | — | ( |
) | |||||||||||||||||||
Foreign exchange adjustments |
( |
) | — | ( |
) | ( |
) | — | ( |
) | ( |
) | ||||||||||||||||
Accrued expense |
— | |||||||||||||||||||||||||||
As of December 31, 2020 |
— | |||||||||||||||||||||||||||
Cash flows |
— | ( |
) | — | ( |
) | ( |
) | ||||||||||||||||||||
Acquisitions-leases |
— | — | — | — | — | |||||||||||||||||||||||
Disposals-leases |
— | — | — | — | ( |
) | — | ( |
) | |||||||||||||||||||
Foreign exchange adjustments |
( |
) | — | ( |
) | — | — | ( |
) | ( |
) | |||||||||||||||||
Accrued expense |
— | — | ||||||||||||||||||||||||||
As of December 31, 2021 |
— | — | ||||||||||||||||||||||||||
42 |
Share-based payment |
(a) | Share options |
Average exercise price per share option |
Number of options (in ’000) |
|||||||
Outstanding as of January 1, 2019 |
||||||||
Forfeited during the year |
( |
) | ||||||
Outstanding as of December 31, 2019 |
||||||||
Forfeited during the year |
( |
) | ||||||
As of December 31, 2020 |
||||||||
Forfeited during the year |
( |
) | ||||||
Exercised during the year |
( |
) | ||||||
As of December 31, 2021 |
||||||||
42 |
Share-based payment (Continued) |
(a) | Share options (Continued) |
Exercise price per share option |
Number of options (in ’000) |
|||
8.00 |
||||
50.00 |
||||
98.06 |
||||
118.00 |
||||
42 |
Share-based payment (Continued) |
(b) | PSUs |
Weighted average grant day fair value |
Number of units (in ’000) |
|||||||
Outstanding as of January 1, 202 0 |
||||||||
Granted during the year |
||||||||
Forfeited during the year |
( |
) | ||||||
Outstanding as of December 31, 2020 |
||||||||
Granted during the year |
||||||||
Forfeited during the year |
( |
) | ||||||
Exercised during the year |
( |
) | ||||||
Outstanding as of December 31, 2021 |
||||||||
PSUs granted in Year ended December 31, |
||||||||
2020 |
2021 |
|||||||
Risk-free rate |
% | % | ||||||
Expected volatility rate |
% | % | ||||||
Expected dividend yield |
% | % |
43 |
Related parties and related party transactions |
(a) | Names and relationships with related parties |
Name of related parties |
Relationship with the Company | |
43.1 |
Significant transactions with related parties |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Technology platform based income |
||||||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||||||
|
|
|
|
|
|
|||||||
Other income |
||||||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||||||
|
|
|
|
|
|
|||||||
Investment income |
||||||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||||||
|
|
|
|
|
|
|||||||
Finance costs-Interest income |
||||||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||||||
|
|
|
|
|
|
|||||||
Finance costs-Interest expense |
||||||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||||||
|
|
|
|
|
|
|||||||
Sales and marketing expenses, general and administrative expenses, operation and servicing expenses, and technology and analytics expenses |
||||||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||||||
|
|
|
|
|
|
|||||||
Other gains/(losses) - net |
||||||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
43 |
Related parties and related party transactions (Continued) |
43.1 |
Significant transactions with related parties (Continued) |
43 |
Related parties and related party transactions (Continued) |
43.1 |
Significant transactions with related parties (Continued) |
43 |
Related parties and related party transactions (Continued) |
43.1 |
Significant transactions with related parties (Continued) |
43.2 |
Year end balances with related parties |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
Cash |
||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||
|
|
|
|
|||||
Financial assets at fair value through profit or loss |
||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||
|
|
|
|
|||||
Account and other receivables and contract assets and other assets |
||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||
|
|
|
|
|||||
Payable to platform investors, accounts and other payables and contract liabilities, payable to investors of consolidated structured entities and other liabilities |
||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||
|
|
|
|
|||||
Financial assets at amortized cost |
||||||||
Ping An Insurance (Group) Company of China, Ltd. and its subsidiaries |
||||||||
|
|
|
|
43 |
Related parties and related party transactions (Continued) |
43.3 |
Key management personnel compensation |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Wages and salaries |
||||||||||||
Welfare and other benefits |
||||||||||||
Including: Bonuses |
||||||||||||
Share-based payment |
||||||||||||
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
44 |
Dividends |
45 |
Contingent liability |
46 |
Parent company only condensed financial information |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Investment income |
||||||||||||
Income from subsidiaries and VIEs |
||||||||||||
|
|
|
|
|
|
|||||||
Total income |
||||||||||||
|
|
|
|
|
|
|||||||
General and administrativ e expenses |
( |
) |
( |
) |
( |
) | ||||||
Credit impairment losses |
( |
) |
( |
) |
||||||||
Finance costs |
( |
) |
( |
) |
( |
) | ||||||
Other gains/(losses) - net |
( |
) |
||||||||||
|
|
|
|
|
|
|||||||
Total expenses |
( |
) |
( |
) |
( |
) | ||||||
|
|
|
|
|
|
|||||||
Income before income tax expenses |
||||||||||||
Less: Income tax expenses |
( |
) | ||||||||||
|
|
|
|
|
|
|||||||
Net profit for the year |
||||||||||||
|
|
|
|
|
|
|||||||
Net profit attributable to: |
||||||||||||
Owners of the Company |
||||||||||||
|
|
|
|
|
|
|||||||
Other comprehensive income/(loss), net of tax: |
||||||||||||
-Exchange differences on translation of foreign operations |
( |
) | ||||||||||
|
|
|
|
|
|
|||||||
Total comprehensive income for the year |
||||||||||||
|
|
|
|
|
|
|||||||
Total comprehensive income attributable to: |
||||||||||||
Owners of the Company |
||||||||||||
|
|
|
|
|
|
46 |
Parent company only condensed financial information (Continued) |
As of December 31, |
||||||||
2020 |
2021 |
|||||||
RMB’000 |
RMB’000 |
|||||||
ASSETS |
||||||||
Cash at bank |
||||||||
Financial assets at fair value through profit or loss |
||||||||
Financial assets at amortized cost |
||||||||
Accounts and other receivables and contract assets |
||||||||
Investments accounted for using the equity method |
||||||||
|
|
|
|
|||||
Total assets |
||||||||
|
|
|
|
|||||
LIABILITIES |
||||||||
Borrowings |
||||||||
Accounts and other payables and contract liabilities |
|
|||||||
Convertible promissory note payable |
||||||||
Optionally convertible promissory notes |
||||||||
Other liabilities |
||||||||
|
|
|
|
|||||
Total liabilities |
||||||||
|
|
|
|
|||||
EQUITY |
||||||||
Share capital |
||||||||
Share premium |
||||||||
Treasury shares |
( |
) |
( |
) | ||||
Other reserves |
||||||||
Retained earnings |
||||||||
|
|
|
|
|||||
Total equity |
||||||||
|
|
|
|
|||||
Total liabilities and equity |
||||||||
|
|
|
|
46 |
Parent company only condensed financial information (Continued) |
Year ended December 31, |
||||||||||||
2019 |
2020 |
2021 |
||||||||||
RMB’000 |
RMB’000 |
RMB’000 |
||||||||||
Cash flows from operating activities |
||||||||||||
Cash used in op e rating activities |
( |
) |
( |
) | |
|
( |
) | ||||
|
|
|
|
|
|
|
|
| ||||
Net cash generated from/(used in) operating activities |
( |
) |
( |
) |
|
|
( |
) | ||||
|
|
|
|
|
|
|
|
| ||||
Cash flows from investing activities |
|
|
|
| ||||||||
Capital contribution to consolidated entities |
( |
) |
( |
) |
( |
) | ||||||
Payment for advances to consolidated entities |
( |
) |
( |
) |
( |
) | ||||||
Receipts of repayment of the advances from consolidated entities |
||||||||||||
Proceeds from sale of investment assets |
|
|
|
| ||||||||
Payment for acquisition of investment assets |
( |
) |
— |
( |
) | |||||||
|
|
|
|
|
|
|||||||
Net cash generated from/(used in) investing activities |
( |
) |
( |
) |
|
|
| |||||
|
|
|
|
|
|
|
|
| ||||
Cash flows from financing activities |
|
|
|
| ||||||||
Proceeds from issuance of shares and other equity securities |
|
|
|
| ||||||||
Proceeds from exercise of share-based payment |
|
|
— |
|
|
|
— |
|
|
|
|
|
Proceeds from borrowings |
| |||||||||||
Repayment of interest expenses and borrowings |
( |
) |
( |
) | |
|
( |
) | ||||
Payment for repurchase of ordinary shares |
|
|
|
( |
) | |||||||
Other financing activities |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
| ||||
Net cash generated from/(used in) financing activities |
( |
) | ||||||||||
|
|
|
|
|
|
|
|
| ||||
Effect of exchange rate changes on cash and cash equivalents |
( |
) |
|
|
( |
) | ||||||
|
|
|
|
|
|
|
|
| ||||
Net increase/(decrease) in cash and cash equivalents |
( |
) |
|
|
|
( |
) | |||||
Add: Cash and cash equivalents at the beginning of the year |
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
| ||||
Cash and cash equivalents at the end of the year |
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
47 |
Subsequent events |