A：The company proactively pivoted its strategy by emphasizing compliance and risk management at the core of its strategy in response to regulatory changes.

A：The consumer credit industry faced a sector-wide risk elevation amid significant business adjustments in 2025, leading to notable volatility in the company's risk metrics.

A：The company prioritized risk management by adjusting risk strategies across the entire credit life cycle, which included tightening acquisition and engagement of high-quality users, enhancing the detection of multi-borrowing risks, and maintaining stable origination to high-quality borrowers while strategically contracting higher risk segments.

A：The company's models were enhanced to detect instances of users applying for loans across multiple platforms within a short period, which is interpreted as potential financial stress. Proactive measures such as lowering credit limits or restricting loan disbursements were taken to mitigate potential risks before they materialized.

A：The company's FPD 30, a leading risk indicator for new loans, declined by approximately 18% sequentially in Q4.

A：The company seamlessly incorporated the one-time credit remediation policy into its collection strategy matrix to support asset recovery and incentivize borrower repayment intent. This is expected to have a positive impact on recovery efforts.

A：As of January 2026, the C 2 M2 ratio was broadly stable after peaking in October. The company expects the C 2 M2 ratio in February to broadly return to the levels seen in July and August 2025.

A：The company achieved a modest reduction in ABS issuance costs and a historic low overall funding cost in full year 2025. Despite short-term volatility, consistent asset performance enabled the company to build strong partnerships with financial institutions for funding. The company plans to diversify funding channels and maintain stable liquidity at competitive costs.

A：The company's priority in 2026 is to increase the proportion of high-quality users in the acquisition mix, further refine underwriting and pricing strategies to improve acquisition efficiency, and maintain a relatively stable customer acquisition cost.

A：The technology solutions business exhibited strong growth momentum in 2025 with a total loan volume up by approximately 448% year over year.

A：The 1 Core 2 win strategy for 2026 involves remaining committed to serving high-quality users, strengthening operating capabilities, and enhancing resilience under an evolving regulatory framework for the credit business.

A：The regulatory-driven restructuring is expected to accelerate industry consolidation over the next few years, and the company views this evolution as an opportunity to upgrade core competencies and build the foundation for sustainable long-term growth.

A：The new phase of growth for the technology solutions business involves entering a new level of integration of its capabilities into the inclusive lending value chain of banks through flexible collaboration models.

A：In 2025, the company returned approximately US dollar 200 million in dividends and US dollar 680 million via share repurchases, representing 98% of its 2024 and 2020 net income. The company has also announced plans to remain committed to delivering decent shareholder returns through a progressive dividend policy and to continue focusing on capital allocation efficiency.

A：In Q4, the operational focus shifted toward efficiency improvement, cost reduction, and a continuous effort to manage risk exposure.

A：Revenue from credit-driven capital heavy was 3.43 billion in Q4 compared to 3.87 billion in Q3 and 2.89 billion a year ago. The sequential decline was primarily due to a significant lower off-balance sheet loans.

A：Sales and marketing expenses declined 17% QoQ as the company took a more cautious view on customer acquisition due to higher overall risks.

A：The 90 day delinquency rate was 2.71% in Q4 compared to 2.09% in Q3.

A：Non-GAAP net income per fully diluted ADS was 8.2 RMB in Q4, which brought the non-GAAP EP AD for the full year of 2025 to RMB 46.8.

A：Regulatory efforts to reduce funding loan yields have driven down overall borrowing costs and led to the exit of high pricing platforms in the market. In the long run, this policy is expected to reduce the burden on consumers and create a healthier market, leading to industry consolidation and supporting the growth of the consumption sector. The company's average pricing dropped by 140 basis points in the fourth quarter, and they expect further adjustment in average pricing in 2026. In terms of tax rates, the Q4 take rate was 3.5%, and excluding one-time items, operational delivery was slightly below 3%. The company aims to maintain a tax rate above 3% if the regulatory environment remains stable.

A：The company has always prioritized shareholder returns and has been actively managing the balance between dividend payments and share buybacks. In 2024, the cumulative dividend payout and share buyback were close to 200 million and $680 million, respectively, with a total payout ratio of about 56% as a percentage of 2024 GA net income. Since the beginning of 2024, approximately 40 million in dividends have been paid, accounting for about 25% to 25.4% of the total share count. The company aims to maintain a progressive dividend policy to provide shareholders with an expectable dividend yield. Regarding share buybacks, the company is taking a cautious approach due to the micro environment and regulatory dynamics but remains open-minded and has an outstanding buyback program that could be resumed if the conditions become more stable.

A：The outlook on the proportion of heavy versus SL (short-term lending) business models for the current year is not directly provided in the transcript. However, the focus is on the proactive management of risks, particularly through underwriting and collections, which has led to improvements in customer structure by excluding high-risk groups and focusing on high-quality customers. For a detailed strategy and proportion outlook, specific reference is made to the company's Chief Risk Officer (CRO), Mr. John Ke.

A：The trend of risk indicators thus far this year has been managed, with the company taking proactive steps in underwriting and collections to mitigate risks. In the fourth quarter, due to tightened liquidity, the industry faced significant pressure, but the company responded by quickly tightening pricing and credit limit standards and improving the identification of multi-platform borrowing risks. These measures helped in excluding high-risk groups and focusing on high-quality customers, which improved the customer structure. However, for a detailed trend analysis and future forecasts, specific reference is made to the company's Chief Risk Officer (CRO), Mr. John Ke.

A：The company adjusted its collection strategy by intervening with manpower for high-risk users earlier, offering fee discounts or waivers for customers with temporary financial difficulties, and by increasing incentives for its collection teams.

A：As a result of the adjusted collection strategy, the Fpv 30 for new loans in Q4 dropped by 18%, and the FTD 30 for the December cohort was near its best level in the past two years. The positive trend continued in 2026, with an additional 10% improvement in Fpv settlement from December. Also, the overall risk improved, as indicated by the peak and subsequent stability of the Cm 2 ratio in October and November, and a decrease of 8.2% in January.

A：The company acknowledges that the macro environment is undergoing changes with ongoing industry adjustments. They plan to closely monitor all risk signals and remain flexible to adjust their strategies as the environment evolves.

A：The company normally adjusts the mix between capital line and capital-heavy models based on the micro and macro environment. In an up cycle, they prefer capital-heavy models for higher returns, while in a down cycle, they tend to favor lighter capital models. In 2026, they plan to shift slightly towards capital-light models, expecting an increase in the volume of lighter models, although they do not set a fixed target for the mix between the two.

A：The company expects the composition of loan volume to change, with a likely increase in the percentage of lighter models, leading to a number moving up from the previous year. However, they do not set a fixed target for the mix between capital line and capital-heavy models.

A：The company sees the IC business as a crucial part of its platform strategy and aims to serve a broader user base by using different models to match assets with the right funding efficiently. In terms of funding costs, the company acknowledges the uncertainty in the macro and regulatory environment, which affects funding availability and cost. They plan to expand financing channels and optimize structures to maintain stable and competitive funding costs throughout the year.

A：While the Cm 2 level has shown significant improvement in January and February, it is not yet clear if the improvement is sustainable. The industry is still undergoing adjustments, and regulatory uncertainty remains. The company is maintaining a prudent risk strategy, focusing on loan quality, and working to attract higher-quality users.

A：The company has seen positive signals in the overseas market, particularly with the UK market, and plans to continue investing more resources in overseas expansion. They intend to enter new markets in 2026, focusing on Europe, Latin America, and Southeast Asia, balancing resource allocation between mature and developing regions. They aim to grow their overseas team to about 200 people by the end of the year and are confident in their technology and risk models, which they believe are best in class.