Financial Data and Key Metrics Changes - Group normalized revenue increased by 3% to AUD 541.6 million, with normalized unpata at AUD 103.2 million, down 4.1% year-on-year [4][14][26] - Statutory net profit after tax rose by 6.4% to AUD 95.8 million, while normalized return on capital employed increased to 63.4% [6][14][26] - The cost to income ratio improved by 230 basis points in the second half compared to the first half, with a full-year ratio of approximately 58.7% [5][44][26] Business Line Data and Key Metrics Changes - Group Remuneration Services (GRS) segment saw normalized revenue slightly up to AUD 293.4 million, with novated lease sales growing by 4.1% [16][17] - Asset Management Services (AMS) revenue increased by 4.3% to AUD 185.5 million, with written down value up 6.4% [22] - Participant numbers in the Plan and Support Services (PSS) segment grew by 10.5% organically, with total customers increasing by 21.5% to over 42,600 [23][24] Market Data and Key Metrics Changes - The EV percentage of new novated sales reached 56% in Q3 before returning to around 45% in Q4, consistent with previous periods [18][19] - Demand and momentum remained strong, with order growth of 11.3% in June and July compared to the same period last year [18] - The company reported a strong customer growth across all segments, particularly in the SME segment [4][20] Company Strategy and Development Direction - The company aims to be a trusted partner providing solutions that simplify processes, focusing on customer experience, technology enablement, and broadening its ecosystem of partners [7][10] - Investments in digital solutions, AI, and automation are central to enhancing customer experience and operational productivity [8][10] - The Simply Stronger program has been completed, with expectations of improved customer experiences and productivity gains [13][29] Management's Comments on Operating Environment and Future Outlook - The company expects auto supply and used car values to remain stable, with continued growth in new client wins and NDIS participant growth supporting customer growth across all segments [33][35] - Management anticipates benefits from strategic investments and the removal of non-recurring costs in FY 2026 [35][36] - The company remains optimistic about growth opportunities despite the removal of setup fees impacting margins in the PSS segment [56][72] Other Important Information - The company executed a successful AUD 300 million private placement, enhancing investor diversity and lowering funding costs [6][21] - The Onboard Finance segment's normalization concluded in FY 2025, with expectations of neutral contributions in FY 2026 [47][52] - The company maintained a strong balance sheet with no maturities due in the next twelve months, providing flexibility for growth [31] Q&A Session Summary Question: Can you unpack the drivers for the improvement in novated yield? - The improvement was largely due to a higher proportion of plug-in hybrids at higher price points and improvements in insurance related to residual risk [39][40] Question: Is the 4.7% of novated leases through Olli incremental business? - Most of the new customers acquired through Olli are in employee brackets of 20 to 200, which was not previously targeted [41][42] Question: What should be expected for the cost to income ratio in FY 2026? - A fair assessment for FY 2026 would be around the 57% mark, with further benefits expected from productivity investments [44][46] Question: Will onboard finance be a positive contributor to NPATA for FY 2026? - It is expected to be neutral for FY 2026, with positive contributions anticipated thereafter [47][48] Question: How do you view margin within PSS with the new acquisition? - There will be a bit of downward movement on the margin in 2026, but automation and process improvements are expected to help recover margins over time [55][56] Question: What is the outlook for GRS contract renewals? - Approximately 10% of the portfolio is up for renewal over the next eighteen months, with a strong pipeline for new opportunities [86][87]

Core Viewpoint - The asset management industry must enhance multi-asset allocation and promote global allocation strategies in response to current market conditions [1][4]. Group 1: Global Allocation Importance - The current global landscape is undergoing significant changes, impacting investment across markets [2]. - Factors driving the bond market have become more diverse since February 2020, with increased influence from overseas markets [2]. - Key reasons for the growing overseas influence include increased exchange rate volatility, reduced predictability of Federal Reserve actions, and strengthened economic trade interactions between the Eurozone and China [2]. Group 2: Challenges in Asset Management - The asset management industry faces challenges in investment and allocation due to a high concentration of domestic institutions in RMB-denominated fixed income assets [2]. - A potential economic upturn could lead to a downturn in the bond market, ending a prolonged bull market [2]. - The current asset management scale is large but lacks diversity in asset categories, indicating a need for deeper investment strategies [2]. Group 3: Need for Diverse Asset Allocation Products - There is a demand for more diverse asset allocation products in the domestic market, particularly global multi-asset allocation products [3]. - Academic research indicates that long-term returns of an investment portfolio are primarily determined by asset allocation [3]. - The rise of passive investment is attributed to the growing acceptance of diversified asset allocation, which is cost-effective [3]. Group 4: Misconceptions about Global Allocation Products - There are misconceptions regarding global allocation products, which are primarily mainstream in developed countries [4]. - True global allocation products involve dynamic allocation of domestic and foreign assets while managing foreign currency exposure [4]. - The current market lacks such global allocation products, indicating a significant growth opportunity in this area [4]. Group 5: Strategic Preparedness for Change - Companies should prepare for changes by enhancing talent, mechanisms, and products, focusing on equity, cross-border, and quantitative strategies [4]. - The company has a strong commitment to increasing the proportion of cross-border foreign currency assets and possesses solid capabilities in equity investment and individual stock research [4].

Core Insights - The "2025 Asset Management Annual Conference" was held in Shanghai, focusing on the theme "Breaking the Deadlock and Restructuring - Rebuilding Competitiveness in Asset Management" [1] - The conference featured the release of the "2025 China Asset Management Development Trend Report," which aims to analyze industry changes and trends to guide asset management institutions and professionals [1] Summary by Sections - The report consists of five sections: a retrospective on asset management, rebuilding competitiveness, new trends in asset allocation, a semi-annual report on bank wealth management, and interviews with industry leaders [2] - The first section reviews the past decade of asset management data and highlights the top ten significant events in the past year [2] - The second section analyzes new characteristics of the asset management industry, wealth management transformation, and public fund reforms to identify core competitiveness [2] - The third section discusses the predictions and investment strategies of asset management institutions regarding various asset trends in a low-interest-rate environment [2] - The fourth section provides data analysis of the wealth management market for the first half of the year, utilizing the South Finance Wealth Management platform [2] - The fifth section features interviews with leaders from various asset management institutions, discussing the current state and future of the industry [2][3]

Core Insights - Ping An Wealth Management has created over 110 billion yuan in investment returns for clients over five years, averaging over 260 billion yuan annually to support the real economy [1] - The company aims to enhance its position as a technology-driven asset management institution, leveraging AI and digital technology to create competitive advantages [1][5] Investment Research Capability - The company emphasizes a "customer-centric" approach, integrating solid investment research capabilities, a clear product system, cutting-edge digital technology, and high-quality customer service [2] - It has developed a dual-pillar investment research capability focused on asset allocation and portfolio investment, ensuring standardized and modular investment management processes [2][3] - As of July 2025, the company's product net loss ratio and negative return ratio are 0.65% and 0.55%, respectively, outperforming industry averages [3] Product Development - The company has launched a new product brand system called "An+Xin Stable and Long-term," which includes four product series targeting different investment needs [4] - The product system aims to meet diverse wealth management demands with clearer positioning and richer functional scenarios [4] Customer Service - Ping An Wealth Management collaborates with Ping An Bank to enhance customer service capabilities, offering innovative services like cash combination services and 24/7 investment product access [4] - Since 2025, the total trading volume of cash management night market products has accounted for 17% of transactions, with subscription accounting for 28% [4] AI and Digital Technology - The company is actively integrating AI technology into its core operations, enhancing investment research, marketing, and operational efficiency [5][6] - It has developed a digital employee, EVA, which operates across various functions, significantly improving decision-making efficiency [6] Support for Real Economy - Ping An Wealth Management is committed to supporting the real economy, focusing on technology and innovation sectors, with over 25 billion yuan allocated to technology finance by June 2025 [7] - The company has also invested over 15 billion yuan in green finance, launching multiple green financial products to promote sustainable development [7][8] ESG and Green Finance - The company has established a strong presence in green finance and ESG-related businesses, launching various themed products and participating in green bond investments [8] - It aims to align its development with national strategies, enhancing its core investment research capabilities to support new quality productivity [8]

Core Viewpoint - The article discusses Ray Dalio's new book "Why Nations Fail," which explores the long-term debt cycle and its implications for the U.S. economy, emphasizing the historical patterns of debt accumulation and the eventual consequences of unsustainable debt levels [9][20][196]. Group 1: Economic Machine Operation - The economic machine can be divided into five macroeconomic sectors: households, businesses, government, finance, and overseas sectors [22][23]. - The private sector, comprising households and businesses, is the main wealth creator, with employment and customer relationships being key dynamics [26][30]. - The wealth distribution structure in the U.S. is highlighted, with 1% of the population holding significant wealth, while the bottom 50% are primarily in debt [41][44]. Group 2: Government and Debt - The government acts as the economic manager, with tax revenue being a crucial source of government credit [56][58]. - The U.S. government has a history of budget deficits, with expenditures exceeding revenues, leading to a national debt exceeding $36 trillion [70][72]. - The government often rolls over debt, creating a cycle of borrowing to pay off existing debt, which raises concerns about the sustainability of this approach [73][75]. Group 3: Long-term Debt Cycle - Dalio identifies an 80-year long-term debt cycle, where each cycle leads to significant debt accumulation and eventual crises [197]. - The short-term debt cycle typically lasts around 6 years, with the current cycle starting in 2020 and nearing completion [193][194]. - The article emphasizes that during the later stages of the long-term debt cycle, the government may resort to debt monetization, leading to currency devaluation as a means to manage debt [205][206]. Group 4: Economic Participants and Behavior - The main participants in the economic machine include borrowers, lenders, banks, central governments, and central banks, each with distinct motivations and behaviors [127][131]. - The article discusses the nature of debt and credit, highlighting that debt represents a promise to pay in the future, while credit is a commitment to repay borrowed funds [140][145]. - The relationship between debt and money supply is explored, indicating that increases in debt often correlate with economic fluctuations and purchasing power changes [155][181]. Group 5: Implications for Investment - The article suggests that understanding the dynamics of the economic machine and the long-term debt cycle can provide insights into potential investment opportunities and risks [20][196]. - The current state of the U.S. economy, characterized by high government debt and pressures on fiscal sustainability, may influence market behavior and investment strategies [119][225]. - The historical patterns of debt crises and government responses can serve as a framework for anticipating future economic developments and investment landscapes [124][205].

Core Viewpoint - The Bank of Japan (BOJ) is considering further interest rate hikes if economic and inflation conditions meet expectations, as indicated by BOJ policy committee member Nakagawa Junko [1][2]. Group 1: Economic Conditions - Nakagawa stated that the current economic environment is more favorable for interest rate hikes compared to April [1]. - The market's expectation for a rate hike has risen to approximately 60% by the end of October, up from 40% in early August [1][2]. Group 2: Inflation and Monetary Policy - Japan's core consumer price index reached 3.3% in June, exceeding the BOJ's 2% target for over three years, prompting calls for a shift to a more hawkish policy stance [2]. - Nakagawa emphasized that the BOJ will continue to support the economy through current monetary easing until there is more certainty regarding inflation and economic performance [1][3]. Group 3: Labor Market Dynamics - The strong labor market is seen as a key reason supporting the case for interest rate hikes, with wage growth expanding from large enterprises to small and medium-sized businesses [4]. - Nakagawa noted that companies are increasingly inclined to raise wages and prices, reflecting expectations of continued labor market tightness [5].

Core Insights - The asset management industry is facing significant market volatility in 2023, prompting institutions to optimize asset allocation strategies and enhance product competitiveness to adapt to market changes [1][3][4] Group 1: Industry Challenges and Opportunities - The asset management sector has experienced profound adjustments over the past year, with traditional asset scarcity continuing while the equity market shows signs of improvement [4] - There is an increasing demand for wealth reallocation among residents, leading to a rise in the need for wealth management products [4] - The public fund industry is witnessing new growth opportunities due to favorable external conditions and regulatory support [4][9] Group 2: Strategic Focus Areas - Institutions are encouraged to shift towards market-oriented mechanisms, enhancing multi-asset acquisition and combination capabilities [3][7] - Improving research and customer service capabilities is deemed essential for rebuilding competitiveness in the asset management sector [3][7] - Companies are advised to prepare for market changes by restructuring product systems, cultivating core research capabilities, and enhancing customer service frameworks [3][7] Group 3: Asset Allocation and Product Development - The importance of combination management is highlighted, particularly in "fixed income plus" products that blend fixed income assets with equities to enhance returns [5][6] - There is a notable shift in asset allocation, with an increasing proportion of equity investments in various institutions [6][9] - The focus on long-term capital entering the market is reshaping market dynamics and investment strategies [9][10] Group 4: Future Industry Landscape - The future of the asset management industry will depend on establishing independent market mechanisms, enhancing multi-asset capabilities, and improving customer service [7][8] - Companies are encouraged to differentiate themselves in a competitive landscape by focusing on comprehensive financial services rather than solely on yield [8] - The industry is urged to adopt self-regulation to promote fair competition and healthy development [8] Group 5: Economic Outlook and Growth Drivers - China's economy is showing resilience, with GDP growth rates exceeding expectations, supported by strong domestic demand [10][11] - Future economic growth is expected to be driven by expanding domestic demand, new production capabilities, and fixed asset investment opportunities [11]

Group 1: Conference Overview - The "2025 Asset Management Conference" was held in Shanghai, focusing on diverse asset allocation strategies in a low-interest-rate environment [1][3] - Experts from various asset management firms discussed key topics such as asset allocation strategies, stock and bond market trends, and the outlook for gold and dollar assets [3] Group 2: Low-Interest Rate Environment - The low-interest-rate environment has fundamentally altered investors' risk preferences and behavior, with the ten-year government bond yield fluctuating between 1.6% and 1.9% [4][5] - The policy support for the capital market since September 2022 has been significant, with long-term funds entering the market, enhancing market confidence [4][5] Group 3: Asset Allocation Strategies - The concept of "asset scarcity" has emerged as a major challenge, prompting innovative strategies such as "seeking returns internally" and "seeking returns externally" [7] - The focus on high-dividend assets reflects the demand for stable returns amid the ongoing asset scarcity [9] Group 4: Equity Market Insights - The equity market is characterized by structural differentiation, with technology and manufacturing sectors gaining attention [9][10] - High-dividend companies are expected to perform steadily, even if their overall returns may not be as impressive in the near term [10] Group 5: Gold and Dollar Dynamics - Gold remains a focal point for discussion, driven by long-term factors such as the weakening status of the dollar and central banks' increasing gold reserves [11][12] - The "fixed income + dollar" and "fixed income + gold" strategies have gained popularity, but caution is advised due to potential risks associated with currency exposure and market volatility [12]

Group 1 - The Bank of Japan (BOJ) maintains a neutral stance despite market speculation about potential interest rate hikes as early as October, leading to a rise in long-term bond yields and a weak demand for short-term bond auctions [2][3] - BOJ committee member Junko Nakagawa emphasized that the central bank will continue to raise policy rates if economic and inflation conditions allow, while also highlighting trade-related uncertainties [3] - The yield on Japan's 10-year government bonds reached a 17-year high earlier this week, driven by stable economic activity and persistent inflation, further fueling speculation about interest rate hikes [3] Group 2 - The auction demand for Japan's two-year government bonds fell to its weakest level in 16 years, with an average bid-to-cover ratio of 2.84, the lowest since 2009 [4] - The weak auction results are attributed to speculation about BOJ interest rate hikes and expectations of increased short-term bond issuance, making it difficult for investors to establish positions at the short end of the curve [4] - Overall, the poor auction results across various maturities indicate weakening market demand amid improved economic prospects and hawkish signals from the BOJ [4]

Core Insights - The rise of passive investment, particularly index-based investment, is becoming a significant focus for asset management institutions as they adapt to changing market dynamics [1][2][3] - The total scale of ETFs listed in China has officially surpassed 5 trillion yuan, marking a historical high and indicating the growing importance of passive investment in capital markets [1][2] Group 1: Factors Driving ETF Growth - Regulatory support and guidance from authorities have been crucial in the rapid development of the ETF market [2] - Significant capital inflows from large institutional investors have provided a solid funding base for ETFs [2] - The supply side has seen public funds increasingly view ETFs as a key growth area, allocating substantial resources to this segment [2] - The ecosystem surrounding ETFs is maturing, with innovations in sales, research, and advisory services further promoting market development [2] Group 2: Characteristics and Trends in Passive Investment - Passive investment is characterized by its transparency, tradability, large capacity, and convenience, making ETFs one of the best tools for asset management companies to engage in equity market investments [2][3] - The structure of stock market investors is rapidly changing, with institutional investors now holding over 50% of the market, which influences the index curves that passive investments track [3] Group 3: Challenges in the Passive Investment Market - The passive investment market faces issues of significant homogeneity and concentrated supply, leading to potential resource wastage within the industry [3][4] - Many asset management firms are grappling with the decision to enter the passive investment space, as competition is fierce and often results in many participants exiting the market [3] Group 4: Strategies for Asset Management Institutions - Asset management institutions are exploring various strategies to provide stable and sustainable returns to investors, particularly in a low-risk environment [5][6] - Institutions are focusing on multi-asset allocation opportunities and enhancing their research capabilities to improve investor returns and client experiences [9][10] - The need for diversified asset allocation is emphasized, as single asset classes may not effectively navigate market cycles [9][10] Group 5: Innovations and Future Directions - Institutions are increasingly adopting quantitative strategies within passive index investment, with trends such as "passive active" and "active passive" emerging [7] - Wealth management institutions are enhancing their strategy for index products and focusing on investor education to promote the value of ETFs [8]