LexinFintech Holdings Ltd. (Nasdaq: LX) saw its shares jump more than 8 percent in early trading Wednesday after the company, an online peer-to-peer lending platform in China, posted better-than-expected earnings for the third quarter with net income increasing more than fourfold.
Despite recent market uncertainty, the Shenzhen-based lender said its operating revenue for the third three months increased more than 13 percent year-over-year to $246.7 million thanks to a 404 percent jump in income from its loan facilitation and servicing fees.
Net income for the quarter was $46 million, or 25 cents per fully diluted ADS, up from $9.93 million a year ago.
In response, shares of LexinFintech soared more than 8 percent to $11.08 per share in morning trading in New York before trending down to $10.04 per share in the afternoon.
“Recent turbulence in the industry and in the quarter had no material impact to our credit quality,” said Ryan Huanian Liu, Lexin’s chief risk officer. “The credit quality of our educated young adult customers continues to be stable – a reflection of the inherent low risk profile of this customer cohort. Our vintage charge-off rate continues to be approximately 2.0%, and our 90 day+ delinquency rate was 1.39% as of September 30, 2018.”
Lexin said its number of active customers in the third quarter reached 2.8 million, representing an increase of more than 11 percent from 2.5 million in the same quarter last year.
Based on Lexin’s assessment of current market conditions, the company expects loan originations for the fourth quarter of 2018 to be approximately 17 billion yuan to 19 billion yuan. Total loan originations in the third quarter was 13.7 billion yuan.
In the announcement, the company also said it completed the submission of its P2P Compliance Self-Inspection Report to the local regulatory office.
“We are pleased with our progress in the P2P registration process, and look forward to completing the next steps in this process," said Craig Yan Zeng, Lexin’s chief financial officer.