Ladies and gentlemen, thank you for standing by and welcome to the Fanhua’s Fourth Quarter and Fiscal Year 2017 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’d like to ask a question. For now your information that 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 & Webcasts section. Today’s conference is being recorded. If you have any objections, you may now disconnect at this time. I would now like to hand – turn the meeting over to your first speaker today, Ms. Oasis Qiu, Fanhua’s Investor Relations Manager. Thank you. Please go ahead.

Good morning. Welcome to our fourth quarter and fiscal year 2017 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 note 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 these statements 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 filings 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 applicable law. Joining us today are our Chief Executive Officer, Mr. Chunlin Wang; and our Chief Financial Officer, Mr. Peng Ge. Mr. Wang will walk you through our financial results in the fourth quarter and fiscal year 2017. He and Mr. Ge will take your questions after the prepared remarks. Now, I will turn the call over to Mr. Wang.

[Interpreted] Thank you for joining us on today’s conference call. Here with me, we have our Chief Financial Officer, Mr. Peng Ge. We will begin today’s call by sharing a bit analysis of and our view on the current market and regulatory trends. We will review our fourth quarter and fiscal year 2017 financial and operational performance, followed by a discussion of our operational and financial outlook in 2018. Then we will have a Q&A session after the report. Firstly, starting from the year-end 2017, bond yields have been on the rise in China, as China kicked off a sweeping overhaul of its financial system in an aim to run in shadow banking, deleverage the financial sector, reduce maturity mismatches and this implicit government bailout guarantee, together with interest rate hike in the United States. In the meantime, regulations have also been tightening in the insurance industry, involving the strengthening of the management of insurance funds, implementation of the second round auto insurance pricing deregulation, adjustment in life insurance products in accordance with the requirements under the Circulate (sic) [Circular] No. 76 and No. 134, aiming at diffusing risk and steering the insurance industry back to its focus on protection-oriented insurance business. Against this backdrop, the growth of China’s life insurance industry slowed down as compared to 2016. Total life insurance premiums in the industry were up 20.3% from 2016 to RMB2.7 trillion in 2017, but the growth rate dropped to 2.4% year-over-year in the fourth quarter of 2017. In the meantime, we also see that the CIRC’s effort to rectify the market has yielded positive results with obvious business structure improvement. Long-term protection-type traditional life insurance business accounted for 76.3% of the total life insurance premiums, up 11.1 percentage points from year-end 2016. We anticipate that the regulators will…

Ladies and gentlemen, we’ll now begin the question-and-answer session. [Operator Instructions] Our first question in queue is from MW Kim. Please ask your question.

Thank you for the result and very strong the – very result and taking my question. This is MW Kim from JPMorgan. I have two questions to the management. The fist question is about the industry dynamics. As Mr. Wang mentioned, the China’s life insurance industry is clearly in the stage of business transformation. So as an early mover and also one of the dominant player in the life insurance distribution channel, the company is currently enjoying decent operating profit, selling more protection policies. So going forward, do you expect that company is to keep strong distribution bargaining power in terms of the choosing sales partner and managing the commission rate and also the product perspective? And also, do you believe that the current industry’s life insurance commission structure to last for next couple of years? We actually observed the opposite outcome in the non-life insurance sector? And second question is about the – your dividend policy. Compared to the last couple of years, the company seemed to enter the stage of making decent profit in core life insurance sales, and overall, the business is not taking the balance sheet risk and life insurance business is pretty promising. And as of the Q4, the company has more than US$400 in cash based on my observation. So we really appreciate the company’s quarterly, the dividend payout in 2017, and should we expect a more generous payout ratio potentially in 2018? Thank you.

[Interpreted] First of all, thank you, MW, for your questions. The current financial market and insurance market overhaul aims at increasing the stability and the security in the market. And in the past couple of years, there have been some issues happening in the insurance industry, and that’s why the regulations seems to be even tougher than the auto industry. But the other direction of the regulatory overhaul is basically to return – to steer the industry back to focused on more and healthy and stable – sustainable product mix, especially the protection-type of products. And we believe that any insurance entities with good sales force and also with good accumulation will enjoy more advantages in – from this trend. For – as for Fanhua, we do enjoy first-mover advantages in terms of both of the number of sales agents and in terms of our technology and our management level and our ability in asset deployments, as well as our team building and culture building ability. And we are confident that we will continue to maintain positive growth in the sales of protection-type of products. And we believe that our growth will outpace that in the industry. As for the commission structure outlook, we believe that as long as a company can provide a good business quality, insurance company will give them favorable achievements. And for Fanhua, because we have – we provide them very good business quality and also very sustainable sales volumes, we are able to enjoy from the cooperation with insurance companies. And we have – basically, we have the largest state in choosing what company or which company to work with us. And we don’t really think the commission structure will change just like what has happened in the non-life insurance sector, because life insurance business…

Thank you.

And the next telephone question comes from Dan Tian from CICC. [Operator Instructions]

Hello, management, congratulations on the excellent numbers and the results. I have two questions today. The first is about the life business. In 2017, what’s the split of commission revenue between protection product and saving product? And if there’s going to be – is there going to be any change in 2018 projected? The second question is, how much profit are we expecting from the commission of renewed premiums in 2018? Thank you.

[Interpreted] Regarding the first question about our product mix in terms of insurance premiums, fewer protection – fewer long-term protection products accounted for 40% to 50% of our total insurance – life insurance premiums. And the endowment insurance accounted for roughly 10%. So total – the total protection products is about 60% of our total life insurance business mix, and then annuity product accounted for roughly 40%. And we expect that in 2018, protection-type products including pure-term protection and endowment will account for 60% to 70%. We have very good business quality in terms of the persistency ratio, which is one of the reasons that insurance companies are still going to cooperate with us. In 2017, the 13-month persistency ratio was 94.2%, which was a quite remarkable achievement and this is a very solid data actually. We haven’t made any measures to manipulate or to increase this ratio. So we expect that going forward, the renewal commission will become an important contributor to our – to the growth of our profit. And we expect in 2018, about RMB200 million profit will be generated from renewal premiums. Thank you.

Thank you. There are no more further questions at this time. I’d like to hand the call back to Oasis for any closing remarks. Please continue.

Thank you for joining us on today’s conference call. If you have any further questions, please feel free to contact us. Thank you.

Ladies and gentlemen, that does conclude the call. You may disconnect. Goodbye.