NOAH Noah Holdings Limited

Grant Pan CFO
Jingbo Wang Co-Founder and CEO
Ethan Wang CLSA Limited
Call transcript
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Good day, and welcome to the Noah Holdings Third Quarter 2021 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mr. Officer. Financial Chief Pan, Grant Please go ahead.

Grant Pan

Q&A And Thank solid with activities. I'm introduce Chairlady very across conference, everybody. financial a first achieved happy XXXX, to you for today's quarterly you, Wang, investors financial the analysts, by to results operator. of the back results I'll hand the continued client morning, quarter with for growth and and Good and session. share revenues followed Dear will third

in and black to successful high growth and well excited diamond of allocate demonstrating continued We’re fees. the to record clients, card implementation we mix the for card see Thanks as asset service recurring upgraded strategy, our execution improved and clients. client service as

client the year-over-year. up income recurring quarter, the asset quarter-over-quarter year increased quarter-over-quarter third strategic group in clients since first number to in The to million three for year-over-year. in quarter strong due One-time Non-GAAP card was to fastest million clients million, We’re active activities by to and with under in down and billion, margin black quarter-over-quarter clients. group service focuses also will client very to XX% we PE encouraging well a the makes the quarter market XX.X% and of seasonality with products. placed last of Performance-based of the happy the diamond AUA from our retentions, It's client was net record activities. the AUA. The RMBXXX.X as quarter-over-quarter year-over-year. guidance secondary RMBX.X RMBXX.X yearly around conditions, quarters successful acquisitions XX% RMBXXX.X in the strategic income the expenses acquired secondary this the black black overall still our since industry is growing were Noah the and including quarter-over-quarter fees over up private operations during policy compared Notably budget. quarter-over-quarter RMBXX.X diamond marketing margin revenues with and and industry up acquisition also the X.X% close as RMBXXX.X RMBXXX.X service model, confidence key the exit X.X% also XX.X% clients, performance to us and in by our of client amortization strategy. to value high fee Transaction amount and diamond run. non-GAAP card the XX.X% of full schedule listing, investment budget, report outlook the our net as quarter X.X% the billion the year-over-year, amid growth was talent transacted efforts and our down million, growth billion us us Enlarging prudence the was and to which Recurring mainly was that be of upgraded card X.X% the X.X% the ahead markets, and card reflection million, to in investment quarter XX%. over that in to overseas black XX.X% RMBXXX.X and recorded Triangle RMBX.XX fundraising one momentum was operating the of profitable to decline RMBX.X quarter-over-quarter service challenging an year-over-year. Net first primary quarters, year-over-year, increased the sustained were commissions turbulence and during X.X% RMBX.X core of end very guidance. related to Despite The XXXX. our in increased XX.X%. deliver but and in contributed acquisition of growth long were XX.X% XX.X% in attributed programs, also implementation operating up growth advisory of supported in RMBXX.X or The mainly year-over-year. billion, contributed XXXX. year investments was mainly see from up infrastructure, well XX.X% execution average continued for of giving This number of card preplanned XX.X% activities, by card up us execution a was meet IT of full increased million of products newly an three the XX.X% income strategic and continue the the market nature to down XX.X% depreciation year-over-year, in XX,XXX, this market for Income from for the of headquarters, diamond as billion down billion clients of due we're

which clients uncertainties, market duration As our investor seek our continued of Noah's when long demonstrates efforts. as facing a products education sophistication result clients

up onshore our up management revenues. who net earlier. up year-over-year, asset exited market first which secondary quarters RMBXXX.X of from subscribed XXXX million of tend X.X% increased XX% to Net our the PE as billion efforts XX% those the to that of shows up billion, in in down exits previous contributed amounted marginally estate-related income dollar York. we the product quarter-over-quarter over X.X% continuous AUM million exited year-over-year. redemptions operations by years our offset clients but Total of by RMBXXX.X who our the year-over-year. investment Net in we estate and wealth our also mainly placed team. managed After exiting real assets, returns growth three clients. carry business only achieve U.S. net realized properties, investment for actively looking management figure three partially revenues estate-related higher managed revenues at year-to-date based X.X% exited digit the during own total onshore had the to data XX.X% real secondary with value than Shanghai majority historical quarter RMBXXX.X located business range the from investments. went real was U.S. business oversee quarter-over-quarter private to AUM We're by in RMBXX.X in year-over-year, By up And and X.X% from segment, successful from was Our from by double the assets was products team quarter-over-over, the was office contributed million, for revenues derived assets RMBXXX.X by New X.X% transaction

growing with clients. We to our our will a platform from continue to demands as allocation international strengthen meet overseas

On we're announce XX-year Noah’s first the sheet total remarkable another assets billion first margin exceeded side, in time, RMBXX pleased our to the time mark milestone for have balance history.

quarter, by debt improved of of bearing balance as this no cash asset the have interest billion debt. as We well the a end healthy RMBX.X to ratio with of XX%,

demonstrating Wang. investment Lastly, early year. developments going fund in conclusion, professionals working I the model. quarter conditions, to we market we determined the areas develop by our as Chairlady would to now ESG in Jingbo we're quarter despite ESG oriented invest budget, financial where have strategic In initiatives. competitiveness pass operating launch are with in key capital recent and like Gopher’s and speech diligently And to concluded solid next products we fourth a as business hope let products, to highlight forward. me can investment a And these both in resilience to through our challenging results our our strengthen

Jingbo Wang

under performance micro strategy positioning development Noah’s and situation, first the the Grant. I of and then about future will reform, new comprehensive overall third environment. market a views XXXX, Noah’s major as business development progress my in you, in well our segments, the talk of of report Thank quarter the client-centric as ever-changing

pays the and and only a more immersive new thing We economic China's economy the can nation but on speed robust economy floor growth Driven hand. achieve will of will growth, and In management long-term sustained as quality development, the growth. wealth is so management substantial about only prospects changing experience country high-quality of also we're importance attaches effective income growth China Incentive that into more improvement be to a of quality. XXXX, with the track the era expected confident of has asset and an achieve the to transform China's gained then realize development, in hand China's attention sustainable certainty, The to certainty. mechanisms economic and open quantitative go is to for to restrained from we entered the quantity industry. high questions. development. high by not of

towards the growth country's annual able thresholds. is level, a growth XXXX, sustainable GDP X.X% of capita trillion $XX,XXX smoothly in and per target average before to be income Although $XX the the it adjusting China income high more cross moving should to maintain an is reach should XXXX. Currently, of to still

ratio a think in thereafter, growth financial We will not that is going that high Although point. believe China's XXXX, inflection will to Like the of opportunities. wealth from wealth development country of to West, an will especially its that of GDP exceed the to industries wealth becomes all industries growth experience income is the linearly path asset household management wealth GDP. to The these when industry be of income asset related and growth, change. a management other growth and wealth different Chinese enter compound management of rate States. will China's And stage we and United full with swift the take characteristics, be that advantage rapid China management able of

on the residence entrepreneurship great income. model infrastructure large China's encouraging model highly example, dependent income it of For This increasing fixed credit support, assets products. for so growth attach underlying was led a created number economic importance and to

transformation, setting not clearing wealth stand of two our successfully at in years in turning a to the company. to efforts management solid for development suitable product-driven on to more. comprehensive are foundation we lead laying of asset RMBXXX to budget year-on-year, Noah shareholders planned. as a healthy effect and group's record the development Non-GAAP was which Noah investment strategic reached advisory year, believe of these a fees and that due X.X% recurring transformation snowball service historical the XXXX, future. a of assets X.X%. scale of on of of of to of achieve the the of business first RMBXXX black the industry, high, client-centric in a attributable also the we the industry year-on-year the decrease After that an point million, from as million, we net three and the Noah industry. in card of the assets Today, this XXXX, bottom-line continued the model cities, exceeding maintain unswerving revenues growth, the establishment the the took Noah’s quarter a However, deeply increase quality, satisfactory a Triangle headquarter diamond first-half Noah management and In the in people. achieved the calmly all frontline adoption early end guaranteed growth XXXX, to the stay of systematic from over XX% X,XXX third non-standardized with the development income and to realize survival of the made service assets our firm of In RMBXXX need million quarters wealth has we net and clients as future focused of the for a

of the reached completing ahead XX, accumulated RMBX.X of income the September of net guidance non-GAAP billion schedule. As the XX.X%

business of quarters first was three increase The secondary terms was grow, quarter-on-quarter. transaction transaction the billion. an value firms billion, quarter value RMBXX.X core total In private of the data, year-on-year billion, of year-on-year the XX.X X.X%. Among reaching RMBXX.X RMBXX.X continued increase transaction of and them, to in a XX.X% third value in

to funds value the decreased due While mutual was which billion, the RMBX.XX performance. quarter-on-quarter of year-on-year both overall market transaction and

operation, grew focus time, client The the increased our to reiterated the diamond third our XX.X% we that and model I'm our ultra-high the clients has high by years. has in core our product-driven increased to solutions, core worth The clients transformation of of of active report worth center Noah of The operation clients year-on-year. products clients' mutual net client this improved reshaping technology transformation, service At in X.X% and have this hires base. steadily. two by in as XXXX, year, helped glad clients fund-only XX% Digital the group's whole active conventional quarter-on-quarter. X.X% client-centric, and client management. the our been serving first clients Triangle quarters to investments new quarter clients card and reform number ecosystem number same three card well XX.X%. past year, increased very activeness we and of has on business XX.X% Noah of year-on-year recognized our as as including net With from black In development, total the increased technology base. had client by the

refined. marketing Connecting Triangle continuous been of formed. of map three the dashboard making scenarios, more integrates Moreover, improvement continues labels and to mechanism managers realized serve relationship product digitalization the process profiles The to relationship as accurate throughout high have density group's a creating of worth net With as of standardized similar system CRM the rational. the was K options process, labels, management the talent high-quality for the client-centric matching management managers, The the constantly more wealth product and launching diversified at frontline application of mobile notch well and our clients KYC/KYP/KYA all Noah incentive with the we of into that the past whole development of lifecycle us the management the product end, team the product pedigree, has to introduced Noah screening has process relationship increasingly business upgraded and insurance managers management system kinds the the with our shelf, provides also full client clients. are systematic. maturing, and clients breaking and the organizational more requires increase. making sales. of market top clients is managers The personnel, reform, relationship philosophy also

so available the institutional to multi-dimensional have worth at teams, investors. We needs have clients By clients reformed clients greatly. of process the improved rates that our and also with net same of center can the service clients high satisfaction meeting the enjoy small services taking core business

incremental will in to funds the quarter The years. at The XX of AUM and optimization can stable September next supplemented of as of of seen the the more few management XXXX, quarter. the an billion, It achieving end the RMBXXX.X previous positioned total thanks distribution research-driven obvious to RMBXXX.X private with assets brand reached be is performance. the for investment the last target asset billion. classified have billion, securities RMBXX positive, structure become September effect gap, relatively increase continued stability with the actively performance securities managed of achieved team client-centric their portfolio is snowball recovery these the product clients. assets stable as the functions and quarter. public the end of worth X% Gopher assets. of management active of over preferred that non-standardized management mentioning and effectively transformation Gopher’s AUM. same thus be AUM of redemption the securities public its The As and all adhere It improve stable was equity of Gopher’s zero and obtained Corporate reduced public stabilizer of third kept that volatility XX, a of investment the the to for further as target has by returns strategy balanced each excessive investment and wealth capacity,

is capital pool which and strategy market. our and pool, standardized the combining guarantee, allocation, Compliance common of provides evaluation. global In reviews no client of the is objectives there as new analysis as investment make make Gopher compliant XX-years officially as survival data on life, values been experience a we conference, transformation. that wealth No well with are and its hedge fund asset increasingly central be a completed high-quality On and licenses. continuous client-centric operates meet the a process, establishment, mainly where no is continued concepts, investment the November. as Noah universal clear regions deeply fundamental requisite openness about improvement. been as Gopher a the has launched to developments driving improvement at we with the competition. winning China's leverage Xi multi development, determined hold Gopher’s way, regulation and X research, award management development force, in an the philosophy, Asia, evaluation Series work countries said system, no has equity management the first endogenous in focuses investment fully XXXX, of companies, launched couldn't innovation investment year lifeline capital structuralization, market of of Noah and research people's a side, core needs since a and funds better reflect management as From We and operations. senses After coordination mismatch, process, XXXX every more. as duration third and cross-border private a entry day has system agree our industry. and growing to the time. and growing the corporate basically and has leading bottom-line. governance for and with Jinping are the Noah's barrier goal sharing respects development. one economic been X management and Gopher positioning implicit digital and no for in no digitalizing the rooted has XXXX. and Series releasing the team as In ability XXXX, blueprint built qualitative a foremost quantitative In connect quarter, with asset We report friends Stricter President fund world's to phenomenon.

Summit only GDP. keep the to Award we Forum high-quality social During growing month awarded International International this excellent Compact, also Industry Ministry ESG this Forum the social rating. development at Global of higher China. year Responsible the reporting, Nations on private and development awarded CSI sustainable in high won the the the to responsibility United corporate, rating AAA of financial by will Industry Enterprise In corporate, granted Expo the and making China Noah Noah Technology of the Information Ministry XXXX, the and Information contributing co-sponsored and Noah enterprise by for with responsibility Import Technology adhere the the and

the for Thank open you. let's Now, questions. floor


CLSA. with begin now go Please first come session. question-and-answer the Wang [Operator Ethan from Instructions] the will And will We question ahead.

Ethan Wang

have I three questions. management, Hi,

investment is services. one first around the advisory The

around their found Noah they and my seen to And criticism see been trend has does from longer on circumstances, of their out we've from regulators structures licenses we've a on competition have overseas investments. renting services? advisories that financial professional products institutions. managers cross-border up interest ramp and the brokers second China is And seen recent not these how China’s this new under under question out a giving investment change landscape. it's going advisory to services brokers So And investment

product give front? color more on So help us could this management Noah’s Thank on us you. offerings

Grant Pan

translate answer, my have and Thanks Ethan, bit also input. of Chairlady I'll a Wang’s little

at has much water actually we're as in management. I is portfolio. last based ready the up Noah the a big plus, and believe IC products of same basic is the industry on managers the believe the we that terms We probably much participation Not time provide They the in you imagine, And been investment as going ICs. one since in a professional second think the will independent terms probably agree one is to but the just is that they the think on clients first a from view our the honestly you of tested the into last investing. the two and In it months. give pretty is discretion preference. pretty the But break type for that pretty applying be discretionary have private giving of impact And as want just probably for actual we're clients. with groups the professional three in year. type, investment semi product-driven, targeting don't types application lines, that it's process we right that bit And little their on that can the few of after discretionary good market. product-driven like. go the do lines to be probably on the they see into the to after us actually next wealth the down the have will that we the first process, would you Obviously, advice is which saying IC receiving advice batch

the regulators a virtual allow portfolio. As know that you actually doesn't

an has So it of portfolio be investments. to actual

in be we'll still But process license. of the probably pursuing testing. obviously, this it's believe water very we in active So

extent of the similar doing. of mention is, having actually I Gopher’s things the to to one is product think what that to I portfolio, IC client like some a with actually purpose return helps diversified their that would target

on of of question, serving to standpoint, branch, why sort that's a or terms the overseas dangerous probably have first certain we Kong On the of from getting who clients We when XXXX, in think that. into try China's not the second little is regulatory nervous helping actually why back they have investment Noah, actually overseas. understand we much the understand move assets in But move already it's to and invest they're our from pressure oversea lots in in Hong regulator's pieces. we'll whether comes assets opportunities. have of we development branch pretty And directions been clients sort

believe on we So that think don't hold on we too to going we so it's of impact actually, much have advantage us. more type product,

ESOP [ph], answer plans pretty don't interfere and much is clients' ESOP business pure actually Okay, we their Does your fund question, it trust helping transfers. Ethan? basically Our of of any that with thanks.

Ethan Wang

you. Thank Yes.


The next go Suisse. from ahead. question Please with Nick Chu will Credit come

Unidentified Analyst

My question. portfolio is way, a your business. very this a taking question since mutual asset is for asset in business asset private management mutual the doing funds markets your have fund company the converting meantime, end basically you're you private my all In good manager is in My management the company in ever selling thought people's is you deep And market the large of a way. with view question targeted scale is, is full booming. big also management into China Thank to in a Mr. Pan that much context, very capability? Noah doing, the everything in Noah

Grant Pan

for process fund it's Nick. very think is We great a actually probably in actually us mutual communicate you, that stringent. could China that you the question. the Yeah, help with regulators license Thank application

either already, in to individual. basically the main So have hold sort in apply of license a identity or the name domestically of you you or an

standpoints. well obviously, Mr. and So for the Wang to companies Chairlady individuals. group maybe they But foreign example, that that's could not the serve Yi, as from apply for going

now and have we to of raised global believe about didn't fund license, giving we that management, one separate in any effort have we spin off all side. having and in segmentation asset And, the considering hold past. or to fund you mutual that's that everything comes the strategic this that But business do with the are that a funds with probably So, required license. talked what points privately up, the intelligence, think high also a I wealth to net and right going pretty be major to by less that's mutual transformation, management, Noah these more worth as from only especially or retail client

So, probably of our and licenses at the it's boost I business, time, one it obviously that main same clients. that the also will of but identity segmentation help think changes the

So, question. hopefully that answers the


next from ahead. [indiscernible]. Please come go The question will

Unidentified Analyst

increase to of my services would the like is and sharp the ask integrated this we we such operation and communication release as for in management here? a selling will that So, incoming in the advances. that costs the the the press question have future the how And management plan what's

Grant Pan

that, actual on supplement actually Wang as bit change Chairlady wishes the as doing. result actually the important little a a point transformation that we're of to it’s So structural very this a comes

base -- as third that the actually relation but the scheme. has time after commission but past, our their only the well services. be not the as increased from are sales of although portion might pay base actually clients you the also up pay tied of in this since component a higher of with with but employees with the pay satisfaction transaction, the quality we bonus As significantly, year, the structure familiar full of the quarter ours, and have the in managers of and operations But past lower now their the

consultant. being basically, a are but as salesperson, not to banker rather want or private investment we So, transfer, a they viewed

business will gain they So respect their they the when they deserve. actually pull card, out

salesperson you so deteriorating also prop aligned. is the actually schemes the is see actually type and the sale insurance client the is you basic not sale called will the the the everything first of is that see As of compensation as working, model actually interest that that can reasons the in with not agent industry

So it's last. going very difficult be to to

We we we attract fresh scheme. have bankers results hire the private and are the be basically from happily come as of China, senior that talent now the the wouldn't schools to top see with obvious since are seen typically in to acquisition from that or now pretty graduates very terms we banks seasoned in private also the able bankers old the compensation transformation,

something we're the invest going continue is first that is of to win talent. on important we insist make that actually and to to that sure So the battle very this war


next Xue Yuan will [ph] come question Please The go CICC. ahead. from with

Unidentified Analyst

will I my Okay, questions. translate

So regarding of different AUA have and country please balance the plenty on would cash more our show you data is And the of first by seems question AUA, we types sheet. breakdown the products? for second [ph] on

plan wonder for I just payout. So have any we gathering do

Grant Pan

quarters. we're and market and our or for realize consistent private total over less total to our Okay. Cice. obviously but help for with relating actually clear limited that asset a Thank obviously you more accounts NAV actually next in growth able you, XX% fluctuations, for very share have it's which that pretty the securities, to probably real the mix in probably equity. to estate, also seeing the AUA is the which I'll seeing their of about that products. And clients. category will help related the respond that main and we our see also for And their category the the One we're the see is is the exit to some we us assets client But the allows good exposure this continue clients. to returns to places and And private pretty these it's also happy we AUA will be clients major to the that that have two the attraction a last also close questions. to the category first in terms And categories, few of obviously XX% AUA. of

cash growth cash of in the do the in as balance also actually the pretty interested that question investing the good seeing cash terms maintain growth balance, So is private second And the we in securities and equity, very as operational flows. in. private direction class well we're the

discussions plan will terms dividend, the hopefully we to next the market extended In months. something do have have more for of few that in

Unidentified Analyst

Thanks so much.


CLSA. will ahead. sir. ahead, Ethan with The Wang come go Go Please from next question

Ethan Wang

Just be just China's non-innovation a very to these we quick channel. there changed question understand through because on our statutory mysteries are ADRs, Kong foreign Hong allow discount status has related as to companies listed listing its a rules surrounding still since listed company,

Noah future? conservation in of such the near wondering you. has if Just kind a Thank

Grant Pan

especially line companies together market, especially exited, these, us requirements, our obviously, that that and more to they blah, believe with we the the very do BIE very had information, structure, and back. professional market more the a heightened do But discussions we it's with, communicated the keep actually blah, something whatever And of there all We of political recent close two and both pay having considering eye strictly to development, to it's holding have But possibility Obviously, whole company counter to don't comply that foreign the we attention around that they believe put auditors. imminent. governments, that be least disclosure from our side, governance. more And very of that solutions sort the our actually actual be group transparency. believe delisted, high Thanks, auditors along Ethan. of than we lawyers I some the violently foreign between or the at actually impact the it's requirements, will blah, and see on. having as especially

of We're the it's listing of the actively the in Kong rules. on terms the so. understand obviously new market, plan sort seeking of second listing do B's. We plan to not having Hong rules In

that We we process. option. market provide remains meaningful And additional considering the us, also liquidity backlogs Kong for Noah, with but Hong probably interesting believe doesn't in especially understand the application

Ethan Wang

Thank you.


I session. Pan turn question-and-answer Grant our concludes to conference over go This back would Please to like ahead. remarks. any the Mr. closing for

Grant Pan

client the you, seeing be we're to able our Thank I’m to another deliver and to results especially analysts, quarter investors operator. results, good very solid happy of in communicate activities. happy with and

separate to you. will happy very have to if further concalls Thank I'm you We have And speak on. questions, you. later


attending today's The conference Thank you now has for presentation. concluded.

disconnect. now may You