Thank you for standing by for Fanhua's first quarter 2022 earnings conference call. At this time, all participants are in a listen-only mode. All lines have been placed on mute to prevent background noise. After the management's prepared remarks, there'll be a question-and-answer session. Please follow the instructions given at that time if you would like to ask a question. For your information, this conference call is now being broadcasted live over the Internet. Webcast replay will be available within three hours after the conference is finished. Please visit Fanhua's IR website at ir.fanhuaholdings.com under the Events and Webcast section. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the meeting over to your host for today's conference, Miss Oasis Qiu, Fanhua's Investor Relations Manager. Good morning. Welcome to our first quarter 2022 earnings conference call. The earnings results were released earlier today and are available on our IR website as well as on Newswire. Before we continue, please know that the discussion today will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. The accuracy of this statement may be impacted by a number of business risks and uncertainties that could cause our actual results to differ materially from those projected or anticipated. Such risks and uncertainties include, but not limited to those outlined in our filing with the SEC, including our registration statement on Form 20-F. We do not undertake any obligation to update this forward-looking information except as required under the applicable law. Joining us today are our Chairman and Chief Executive Officer, Mr. Yinan Hu, Chief Financial Officer, Mr. Peng Ge, Chief Financial Officer, Mr. Lichong Liu, Chief Operating Officer, and Mr. Jun Li, Chief Digital Officer. Mr. Liu will provide a review of our financial and operational highlights in the first quarter of 2022. There will be a Q&A section after the prepared remarks. Now, I will turn the call over to Mr. Liu. Good morning and good evening. Thank you for joining us today on conference call. Since the beginning of 2022, the Omicron COVID-19 variant has been fueling outbreaks in provinces including Shanghai, Guangdong, Shandong, Jilin, Hebei, and Zhejiang, dealing a severe blow to offline activities and training of our team. In the first quarter of 2022, one-third of the training programs and customer activities were canceled, and in most COVID-stricken areas, such as Shenzhen and Shanghai, Fanhua's claims adjusting business almost ground to a halt, recording a loss in the first quarter. The COVID resurgences and economic uncertainties to some extent restrained the release of customer demand for insurance. Along with the high base effect resulted from the transition to the new critical illness definition framework in the first quarter of 2021, the gross written premium for GWP of the life insurance industry in China fell by 3.1% year-over-year. Against this backdrop, Fanhua's first year premiums of life insurance dropped in the first quarter of 2022. However, the GWP of our life insurance business still managed to grow by 10.1% year-over-year, defying the industry's downward trend. Fanhua's 13-month persistency ratio still remains above 91%, while most insurers saw deterioration in their persistency ratios, manifesting the high quality of our business and the stability of our main sales force. Operating income reached 20.6 million RMB, meeting our expectations. Despite mounting external challenges, we have continued to execute on our professionalism, professionalization, career-based digitalization, and open platform strategy and made steady progress in the following key initiatives. 一、降本增效。严格管控各项成本支出，包括优化人员配置，调整低产能机构和收缩低效网点，并通过优化各个环节的工作流程，提高人均效能。一季度扣除数字化和云桐投入的增加，经营管理费用同比下降17.2%。 One, achieving cost reductions and efficiency improvements. We've been able to strictly control costs by optimizing staffing, closing low-performing institutions, and downsizing inefficient outlets, as well as improving average efficiency of our employees by optimizing the workflow in our daily operations. In the first quarter of 2022, if excluding the increase in investments in our digitalization and Yuntong initiatives, our general and administrative expenses decreased by 17.2% year-over-year. 第二，深入推动以保险金信托和家族信托服务拉动中高净值客户经营。泛华面向十万P等骨干代理人举办近十场家办顾问专业培训，完成了超过1,500名家办顾问的认证培训，举办高净值客户沙龙超过二十场。通过保险金信托的设立，促成超过五十单大额保单销售，贡献新单保费超过3,200万元，建军保费超过六十万元。 Two, further enhancing our capabilities to offer referral of insurance trust and family trust services to mid-to-high-net-worth clients. In the first quarter, we have hosted about 10 family office consultants or FOC training sessions, which focus on educating our sales agents on all-around knowledge related to insurance trusts and family trusts, and completed relevant certification programs for over 1,500 elite sales agents, those who have facilitated over 100,000 first year premiums annually. We have also organized over 20 customer engagement activities targeting at high net worth customers, as a result of which facilitated such customers to set up insurance trust accounts covering 50 large-ticket insurance policies, contributing more than CNY 32 million of first year premiums in aggregate, or CNY 600,000 of first year premiums per policy. 三、提升队伍专业销售能力。第一季度除了家办顾问FOC的认证培训，泛华也完成了家庭养老规划、家庭养老规划师课程体系，这里涵盖增额终身寿加养老年金的搭建及讲师授权。接下来将在二季度陆续在全国落地相关的认证培训。下半年也将增加保单管理，也就是保单托管加终极保障的培训认证，持续帮助队伍系统性提升专业知识和能力，促进代理人从保险产品专家到家庭资产配置专家，再到养老传承专家的进化。 Three, improving the professional skills of our sales teams. In the first quarter, apart from offering FOC training and certification programs, we have also finished establishing the course framework for family retirement planners or FRP, with focus on courses in whole life insurance and annuity products, and authorizing FRP lecturers. Relevant training and certification programs are expected to roll out across the country in the second quarter. For the second half of 2022, we also plan to start training and certification programs for policy managers focusing on helping agents to develop the ability to offer policy custody services and enhance knowledge on protection type products, including critical illness products, so as to enable agents to transform from experts on insurance products to experts on family-based asset allocation, and then to experts on elderly care and legacy management. 四、大力引进行业骨干精英。现有组织方面持续推进成建制引进行业优秀创业者的华彩计划。2021年至今，有超过500名行业优秀创业者带领团队加入泛华，一季度持续发力，贡献近4,500万新单保费，成为了行业业务发展的重要力量。云桐职业化组织方面，云桐导师和理财师招募进展顺利。在实施严格业绩考核的基础上，导师和理财师人数超过410名，贡献新单保费近1,500万，人均产能近4万元。 Four, recruiting high-performing elites. For existing sales force, we have been carrying out the Huacai plan for recruiting industry elite entrepreneurs together with their own sales teams. Over 500 elites as well as their teams have become part of Fanhua since 2021 and contributed approximately CNY 45 million of first year premiums in the first quarter of 2022, representing a strong power for Fanhua's business growth. For the Yuntong business unit, the recruitment of Yuntong advisors and financial planners has gone smoothly despite high standards and performance requirements we apply. As of the end of the first quarter, we had over 410 Yuntong advisors and financial planners, contributing approximately CNY 15 million of first year premiums with per capita productivity of about CNY 40,000. 五、筹备蓝掌柜3.0版本五月二十日的正式上线，着力将蓝掌柜从保险产品交易平台全面升级为一站式保险数字化运营平台，使交易和服务更智能、便捷和顺畅。 Five, finalizing the preparation for the launch of Lan Zhanggui app version 3.0 on May 20th, 2022. We have worked to upgrade Lan Zhanggui from an insurance transaction-focused platform to a one-stop digital operation platform, making trading and services smarter, smoother and more convenient. 六，着力构建团队协同的顾问3R行销模式的标准作业流，推动客户经理、方案经理和交付经理的业务飞轮。 Six, working on establishing standard operating procedures featuring a 3R, i.e., account responsibility, solution responsibility, and fulfill responsibility marketing model of platform-supported teamwork to enable our agents to provide more professional and all-around services to their clients. 七、加快推进泛华榕树开放平台的业务拓展。一季度，榕树开放平台贡献新单保费近4,000万元，环比增长62.3%，并呈逐月快速增长态势。 Seven, accelerating market development of our open platform strategy. In the first quarter of 2022, first year premiums facilitated on Fanhua's Rongshu open platform reached about CNY 40 million, up by 62.3% quarter-over-quarter, and have shown an ever stronger momentum month-by-month. 二零二二年第二季度，挑战仍然巨大。一方面，新冠疫情对于队伍线下展业的影响仍在持续。另一方面，双录将自六月起在河北和全国其他地区陆续实施，预计在短期内对公司的业务也会造成一定冲击。面临如此困难局面，管理层仍有信心保证公司经营性盈利。 We still face tremendous challenges in the second quarter of 2022. COVID-19 continues to adversely affect the offline activities of our sales agents. Meanwhile, the regulatory requirement for double recording is set to be implemented in Hebei province and other areas starting from June, expected to temporarily impact the whole industry across the board, including Fanhua. Despite these headwinds, the management team is still confident in making operating profit in the second quarter of 2022. 各位，我是胡义南。接下来我宣布一下这个2022年的分红计划。 Hello everyone, this is Yinan Hu, and now I would like to announce the dividend plan for 2022. 2022年5月26号，泛华宣布将按照20比4.71的比例将其持有的泛华金融控股有限公司的股票派发给泛华股东。 Fanhua announced on May 26th, 2022 that it will distribute 4.71 CNFinance ordinary share to the holder of each 20 Fanhua ordinary shares. 也就是说，每持有二十股泛华股东股的股东将派发四点七一股泛华金融的普通股。换算为ADS，就是每一股泛华的ADS派发零点二三五五股泛华金融的ADS。 This is also equivalent to 0.2355 CNFinance ADS for every 1 ADS of the company held. 股权登记日为2022年6月9号，分红将在2022年6月28号前后派发。 The dividend is payable on or around June 28, 2022 to shareholders of record on June 9, 2022. 基于泛华金融截止到2022年5月26号的市值，也就是昨天晚上的市值，此次股票分红的价值为三千一百三十七万美元，相当于每个ADS零点五八美元，接近泛华2021年全年的现金分红。 Based on the market value of CNFinance as of May 26th, 2022, the value of the stock dividend amounts to approximately $31.4 million, equivalent to $0.58 per Fanhua ADS, close to the total amount of the cash dividends that we paid in 2021. 下面我来回答大家的问题。谢谢大家。 This concludes our presentation, and now the floor will open for your questions. Hello Dave. Thank you. We are ready for questions. Thank you. As a reminder, to ask a question, you will need to press star one on your telephone. To withdraw your question, please press the pound or hash key. Please stand by while we compile the Q&A roster. Our first question comes from the line of Zixian Wang from CICC. Please go ahead. 管理层好，感谢管理层给我这个提问的机会。首先也是恭喜，咱们的Q1的业绩。那我这边呢，其实有两个问题想问一下，第一个问题是关于这个储蓄型的保险，那这个储蓄型保险我们现在一季度卖得怎么样呢？从绝对值或者说从同比的情况，数字是怎么样？然后展望二季度及之后，公司怎么看这个市场储蓄险的需求？然后还有就是我们目前这个储蓄型保险给代理人和从保险公司收的这个佣金大致是一个怎么样的比例？也可以帮助我们判断一下今年的这个佣金收入做一个预测。然后第二个的话呢是，公司在全年目标上有没有一些指引呢？就比如新单保费、营收、营业利润等，也是帮助我们做一个对全年做一个展望吧。然后下面我简单用英语重复一下这两个问题吧。And the first question is about the saving products. Could you share with us the Q1 numbers and the future outlook of savings products as well as the commission rate that we give to the agent and collect from the insurance company, so it may help us to estimate the brokerage income. The next question is, do we have full year guidance in terms of like FYP, revenue or operating revenue? As for my question, thanks. 好的，这个问题有点多哈，那大概我想是三个问题。第一个问题呢，就是关于第一季度我们储蓄险的这个销售情况，储蓄险的这个新单的销售，相比去年同期在保费规模是持平，保费规模是持平。这是第一个问题。但是呢，这个占比有大幅度的提升，这个在产品结构上。那这个产品结构的这个变化呢，主要是源于这个去年一季度就开门红重疾险的这个占比，这个规模，有一个大的增长。 I think your question can be divided into three small questions. For the first part, which is the sales of our savings product in the first quarter of this year, compared to the same period last year, the first year premium of our savings product is flatish year-over-year. However, the percentage of the total amount of first year premium is actually higher than the previous quarter and the pre-previous year, mainly due to the high base in the first quarter of last year due to the high sales of critical illness products prior to the transition to the new critical illness definition framework. 基于市场的需求变化，特别是由原来的重疾险往养老传承方面需求的改变，我们认为这个储蓄险的业务发展，以及市场的增长会持续地继续下去。 As for the changes in market demand, we are observing a trend in customers demand transitioning from the critical illness to products that can cater to their needs for elderly care and legacy management. We believe that the growth momentum of savings products will continue in the coming four quarters. 第二个方面呢，就是关于佣金的情况。佣金，对于我们中介公司来讲，分为首延的佣金和续年的佣金。那么这个储蓄险，或者这个储蓄险的业务，具有这个金额大、期限短的这个特征。所以从总佣金的情况来看，明显是比重疾险的佣金是有下降的，就是从保费规模来讲，是下降的。 As for the commission rate, for the savings products, for insurance intermediaries, our commissions array or commission incomes consist of those first year commission and renewal commissions. There are two basic characteristics of savings products, which is, the policy amount is large, while the renewal terms are relatively short. The total amount of commissions is actually lower, is actually declined. 我们从去年开始，我们开始看到，就是在报表上我们的折标率持续地下降，一直是下降到只有30%多的折标率。那么这个管理层，目前正在通过这个产品和销售方式的这个导向，那么希望逐步地这个提高这个我们的这个产品的缴费期，就是延长产品的周期，提高我们的折标率。目前看来是有所回升。 Since last year, we have observed that the conversion rate between first year premium and APE is actually declining, and the conversion rate has dropped to roughly 30%. We are trying to make an effort to improve the conversion rate by means of improving our product structure as well as the way of selling, to extend the renewal periods or renewal terms of the product that we sell, to improve, so that to improve the conversion ratio. 关于全年的业绩指引，主要我们看到的是受到外部因素对我们的波动和冲击，我们现在不可预见，特别是疫情的影响到底有多大，对我们各个地方的冲击，目前我们没有看到有缓和的迹象。特别是下面的二三线城市，特别是二线城市，所谓的疫情的控制，是相对更加严格。所以我们现在也很难预见全年会是什么样的一个情况。我们争取在下一个季度，希望能够看得更清楚一些。 As for the full-year guidance, we are actually facing a lot of our external macro-environment uncertainties, which makes this difficult to give an accurate prediction of the business outlook going forward. Particularly, we, due to the COVID-19, we don't know the impact, the magnitude of the impact on our business yet. Right now so far we haven't seen any signs of this in terms of the COVID-19 impact, particularly in the second- and third-tier cities where the COVID-19 control measures, the restriction measures is relatively stricter than the first-tier cities. We hope that by the second quarter, we can have a better idea of our future outlook. 从我们内部经营的角度来讲，我们也看到公司的各项经营指标环比是有比较明显的好转的，特别是我们高产能的销售员，特别是我们这几期的这些举措来推动我们的精英销售人员的产能增长，这一块我们是看到有明显的提升的。 However, internally, operationally wise, we are actually seeing sequential improvement in our operating metrics, particularly the continued improvement in the productivity of high-performing agents. 好的，谢谢。这是 Thank you. Hi, Zixian, do you have another question? 感谢管理层的回答。我不知道现场还有没有其他的投资者，如果没有的话，我其实还有一个问题想问。 Sure。 对。OK，OK。那我还有一个问题，其实是想问关于咱们这个人身险销售新规，它这个也是上个月下发了这个征求意见稿，和去年的那个征求意见稿其实是有一些区别的，但是核心还是有提到说保险公司去给到渠道的一个复杂费用率的一个上限问题。同时呢，也还提到了一个代理人分级和考试的问题。那我们有展望这个新规未来落地会对我们的这个销售队伍和佣金这块有什么样的影响吗？我还是简单翻译一下这个问题吧。And so they draft up the new sales regulation limited the commission rate and also mentioned to restart the exam for agents. So can we evaluate the influence of this new policy to our sales force and the future commission income? Thanks。 这个新规很显然是为了遏制行业里面的一些乱象，确保整个行业长期健康、稳定的发展。那么作为泛华来讲，我们非常欢迎这个新规能够尽快地落地，因为这个是跟泛华作为长期主义的一个公司来讲，我们非常希望行业能够长期健康地发展。同时，对于保护投保人的权益，让这个保护保险公司的利益，从各个方面来讲，我们认为一个合理的健康运作的产业链，才是真正能够行稳致远。所以我们非常欢迎这个人身险的新规，这个跟泛华的整个价值观和我们整个运营目前是完全契合的。 The draft measures, I think the purpose is to curb the irregularities in the industry and to promote a healthy development in the longer term of the insurance industry. We totally welcome the implementation of these measures. It also in line with our business philosophy since we are here for the long term. We believe that the new measures will be helpful to protect the interests of both the consumers and the insurance companies and all the other participants in the value chains. A reasonable or healthy interest spread between different part of the value chain is helpful, and helpful for a sustainable development of the industry. 我们坚决反对通过佣金来进行市场竞争，而应该是通过产能，通过给客户提供配置更好的产品和服务来进行竞争。所以我们认为未来的泛华的营销员，那么他是要靠产能来提高他的佣金收入，而不是靠佣金水平来增加收入。所以我们目前所进行的所有这些动作，从进行的情况来看，我们高产精英的代理人，其实他们的收入是有大幅度增长的，而不是因为佣金的增长，是因为他们产能的增长。 We totally object to the idea to compete for market share by increasing the commission rate. Instead, we believe that we should provide better services to customers and offer better products so as to compete to get market share. We also observe from our own statistics that our high-performing agents actually have increased their commission income, not because of the increase in commission ratio, but instead because of the productivity increase. All our initiatives, the results also show this continued trend. 好，谢谢。 Thank you. 好，谢谢白女士。 Hi, Steve. Thank you. I show no further questions in the queue at this time. I'd like to turn the call back over to you, Miss Qiu, for closing remarks. Thank you for participating in today's conference call. If you have any further questions, please feel free to contact us. Thank you. This concludes today's conference call. Thank you for attending. You may now disconnect.