Lufax results for the third quarter of 2026 showed a net loss of RMB1,494 million ($223 million), up from RMB380 million a year earlier, as credit impairment losses and income tax expenses rose. Total income fell 4.6% to RMB6,180 million.

Key Takeaways

  • Credit impairment losses rose 10.3%, while income tax expenses increased to RMB773 million.
  • New consumer finance loans grew 25.2%, even as the total outstanding balance of loans enabled fell.
  • Some delinquency measures improved from the prior quarter, but Lufax’s C-M3 flow rate increased.

Lufax results reflect higher credit and tax costs

The China-focused financial services company reported unaudited results on October 28 for the three months ended September 30, 2026. Total expenses rose 1.7% to RMB6,901 million from RMB6,785 million a year earlier.

Credit impairment losses increased to RMB4,511 million from RMB4,089 million. Lufax attributed the rise primarily to higher actual losses and provisions on loans and receivables. Expenses excluding credit impairment losses, finance costs and other gains or losses fell 13.4% to RMB2,262 million.

Income tax expenses rose to RMB773 million from RMB74 million. Chief Financial Officer Jia Liu said the increase was primarily due to a reduction in deferred tax assets and additional withholding taxes connected with dividend distributions from domestic subsidiaries to meet funding needs at the company and its overseas subsidiaries.

ItemDetails
Net interest incomeRMB3,677 million in Q3 2026, compared with RMB3,334 million in Q3 2025
Technology platform-based incomeRMB1,055 million in Q3 2026, compared with RMB1,390 million in Q3 2025
Guarantee incomeRMB1,020 million in Q3 2026, compared with RMB1,353 million in Q3 2025

Consumer finance lending grows

New loans enabled totaled RMB58.3 billion in the quarter, up 2.5% from RMB56.9 billion a year earlier. Within that total, new consumer finance loans rose 25.2% to RMB39.7 billion from RMB31.7 billion.

The total outstanding balance of loans enabled fell 11.9% to RMB167.1 billion as of September 30, while the consumer finance portion rose 19.8% to RMB70.5 billion. Including its consumer finance subsidiary, Lufax bore risk on 95.8% of its outstanding loans enabled, up from 87.3% a year earlier.

Net interest income grew as technology platform-based income and guarantee income declined. Lufax attributed the interest income increase mainly to the expansion of its consumer finance and microloan lending business.

Delinquency measures and governance changes

The company’s 30-plus-day delinquency rate fell to 5.5% at September 30 from 5.8% at June 30, while its 90-plus-day rate fell to 3.2% from 3.7%. Those measures exclude legacy products, the consumer finance subsidiary, Ping An Digital Bank, LU-AN credit subsidiaries and referral products.

The C-M3 flow rate, an estimate of the proportion of current loans that will become non-performing after three months, rose to 1.2% in the third quarter from 1.0% in the second. The consumer finance loan non-performing loan ratio remained at 1.3% at September 30.

Chief Executive Officer Xiang Ji said Lufax had exited certain high-risk customer segments and adjusted its post-loan collection approach. He also said trading in the company’s Hong Kong-listed ordinary shares resumed on September 24.

Separately, Siu Hong Cheng became chair of Lufax’s internal control improvement committee on October 28, replacing Dicky Peter Yip, who remains board chair and a director. Xiang Ji joined the committee.

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