The following is a summary of the Lufax Holding Ltd (LU) Q4 2023 Earnings Call Transcript:

Financial Performance:

• Lufax reported a total income of RMB 6.9 billion for Q4 2023, down by 44.3%.

• Total loan sales experienced a year-on-year decline of 39.6%, equating to RMB 47 billion, due to changes in the business model and prioritizing higher-quality loans.

• Lufax reported a net loss of RMB 832 million for Q4 2023 due to strategic transitions impacting small business owners.

• Despite the difficulties, the company still has a strong cash position with a cash balance of RMB 39.6 billion and financial assets through fair value valued at RMB 28.9 billion.

Business Progress:

• Lufax completed five major steps towards de-risking and diversifying, including segment and product changes, regional adjustments, channel optimization, industry mix adjustments, and a transformation of their business model.

• The company successfully transitioned to a 100% guarantee model, eliminating previous drawbacks.

• Lufax streamlined its direct sales team, downsizing from 47,000 in 2022 to approximately 21,000 in 2023.

• The company's geographic coverage was reduced from over 300 cities to 146 cities by the end of 2023.

• Lufax plans to distribute a special dividend of approximately RMB 10 billion, offering newfound flexibility to shareholders.

• Lufax anticipates a loan sale range of RMB 190 million to RMB 220 billion in 2024, with an ending balance expected to be between RMB 200 billion and RMB 230 billion.

More details: Lufax IR

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