The Guangzhou-based home equity loan provider saw its total interest and fees income plummet to RMB 89.5 million, down from RMB 415.7 million in the first half of 2025. This contraction reflects a deliberate strategy by management to reduce outstanding loan principal and exercise tighter discipline over new disbursements. The company’s delinquency ratio for originated loans climbed to 63.4% by June 30, up from 50.3% at the end of last year.

Despite the financial pressure, Chairman and CEO Zhai Bin highlighted progress in internal efficiency. Operating expenses were cut by roughly 58% year-over-year, driven by organizational restructuring and reduced employee compensation. The firm also reported cash recoveries of RMB 600 million from overdue loans, achieving a 103% recovery rate on those assets. However, a sharp increase in credit loss provisions—rising to RMB 340.7 million from RMB 31.2 million—weighed heavily on the bottom line. The company maintains that these measures are necessary to cleanse its balance sheet and ensure long-term sustainability.