Jingbo Wang - Co-founder, Chairman and Chief Executive Officer Ching Tao - Chief Financial Officer Kenny Lam - Group President

Matthew Larson - Morgan Stanley

[Foreign Language] Thank you, operator and thank you all for joining us today. With me today are Ms.

Ching Tao, our CFO and Mr. Kenny Lam, our newly appointed Group President.

For the last three years Mr. Lam has provided strategic advice to Noah in his role as a Global Partner at McKinsey.

In the future Mr. Lam will mainly focus on operations and management, as well as strategic execution and I will spend more time on business development, product innovation and keys strategy developments.

We are confident that with the combined efforts of the management team Noah will enter another period of high growth. [Foreign Language] Today I will first review our performance in 2014, then Mr.

Lam will introduce himself and discuss Noah's strategy for 2015. Lastly, Ms.

Ching Tao will discuss the details of our fourth quarter financial results and 2015 guidance. We will be happy to take any questions at the end of our prepared remarks.

[Foreign Language] Over the past 2 years, Noah has a hold from a distributor of financial products into a comprehensive financial platform with wealth and asset management capabilities. And in 2014 we also launched our internet finance business.

To more clearly illustrate our performance from this quarter on we will disclose our financial information by business segments. [Foreign Language] We finished 2014 with the strong fourth quarter.

The value of wealth management products distributed in fourth quarter was RMB 11.83 billion. Revenue reached US$63.27 million, a year-over-year increase of 39.2% and operating profit reached US$17.83 million, representing 34.2% growth year-over-year.

In 2014, we distributed RMB 63.37 billion or US$10.3 billion worth of financial products to 9,010 clients, an increase of 42.4% compared to 2013. And our total registered clients reached 70,557.

Net revenue for 2014 was US$247.9 million, an increase of 51.3% compared to 2013. Group operating profit reached US$89.68 million, an increase of 48.1% from the previous year.

The combined operating profit of our wealth and asset management businesses was US$99.85 million, representing an increase of 64.8% from 2013 and we exceeded our guidance by delivering non-GAAP net income of US$77.7 million, an increase of 37.1% from 2013. [Foreign Language] We significantly increased the scale of our wealth management business as we continue to evaluate our client’s needs and develop our own proprietary products.

Our guidance beating [ph] performance in 2014 reflects our efforts to strengthen regional operations and management, increase regional profitability, enhance top performing relationship management – manager teams and increase the average output of our team members. [Foreign Language] As of December 31, 2014 we had 94 branch officers in 63 cities and we continue to increase our market penetration.

We also continued to do a good job of retaining our talent and the turnover rate of our relationship managers and branch office, general managers remained less than 3%. And we compressed the training program for our relationship manager from 2 years to 1 year.

As the number of clients and scale of asset from the management continues to increase, we continue to look at ways to enhance customer service, including capping the number of clients that relationship managers serve at different levels. [Foreign Language] In 2014 Noah has already established itself as a provider of a comprehensive set of financial services in the eyes of our clients and the core competitiveness of our relationship managers has shifted from the distribution of financial products to asset allocation and fully authorized integrated financial planning.

[Foreign Language] In terms of asset categories, Noah's product offerings are more and more diverse and international. The proportion of USD hedge fund, fund of funds, multi strategy hedge funds and investment funds, high performing Sunshine [ph] private equity products and the quant fund of funds have increased significantly.

With the increasing rate of initial public offerings in China, clients who have invested in private equity products at Noah have begun to reap rewards. This in turn has greatly increased enthusiasm for cross cycle private equity products.

We are also seeing increasing interest in private equity, private equity fund of funds, secondary funds and overseas asset allocation. [Foreign Language] In 2015, we will continue to expand our product offerings.

In terms of asset allocation the proportion of the private equity products and secondary market Sunshine private equity funds, hedge funds and international funds will continue to increase. Noah's product center is positioned as a global product platform, covering 8 major regions in China, as well as the global market through our Hong Kong team.

Noah's products center and research department will continue to monitor market trends and lock in access to excellent fund managers with the affiliate [ph] assets for our clients. [Foreign Language] As the wealth management market in China continues to develop, the demand for allocation into international assets continues to increase.

56% of high network clients in China with more than RMB 100 million of assets available to invest have international investments. To meet this demand, Noah Hong Kong has established a product platform to provide clients for the comprehensive debt of financial offerings, including fixed income, secondary market, private equity, real estate funds, cash management, trust, insurance and more.

In October 2014, Noah Holdings in Hong Kong successfully acquired an overseas family trust [ph] license and began providing Noah clients with a more comprehensive set of wealth management services, including family trust and tax planning. In 2014, USD denominated products accounted for 5% of total transaction value and we believe that the proportion of USD products will increase in 2015.

[Foreign Language] Through our internet finance platform UN Gumball [ph] which provides financial products and services to white-collar professionals, Noah has already expanded our plans from high network clients to high network families, institutions and other white-collar professionals. As our business has grown, we have expanded our coverage of global products and improved our ability to build with new channels and innovate.

In 2014, we also took great strides in building our IT system, our international platform and enhancing our risk controlled systems. Mr.

Lam will talk more about this shortly. [Foreign Language] Turning to our asset management services.

By the end of 2014, Gopher asset management, assets under management had reached RMB 49.73 billion or US$8.1 billion, an increase of 62% compared to 2013. [Foreign Language] We continue to diversify the asset portfolio of Gopher asset management, with a proportion of real estate related products decreasing from 66% in the third quarter to 62% in the fourth quarter.

Private equity products increased from 18% in the third quarter to 21% in the fourth quarter and public equity and other products increased from 16% to 17%. Gopher asset management focuses on fund of funds in private equity, real estate, hedge funds, credit products and the family office business and we leveraged our Hong Kong office to provide investment opportunities in both renminbi and USD.

Gopher's PE and VE fund of funds is invested in about 30 of the top domestic private equity funds and is the largest private equity fund of funds in China. In recent successful domestic IPOs Gopher's private equity fund of funds has received public praise and is expected to reap solid returns for investors.

This is testament to our rigorous screen process of selecting excellent fund managers, as well as our strong investment management. [Foreign Language] In addition to our leading position in traditional residential real estate, Gopher asset management has also strategically expanded in three of the major areas of real estate, including office buildings, retail property and international property.

In the fourth quarter of 2014, Gopher asset management also proved its competitive advantage in open market products where we currently focus on asset allocation, selection and quantification. With this as our core investment strategy we provided our investors with a comprehensive asset allocation services.

Currently our issued products and services include hedge fund, fund of funds, fixed income fund of funds, core fund of funds, customized manager of manager services and more. Gopher's asset management's performance has got an increasing price and attention from institutional investors and insurance companies are starting to allocate capital into Gopher asset management products.

In the fourth quarter we launched our new brands Nord [ph] institution which focuses on institutional clients into our asset management business. Nord institution will provide institutional clients with professional and customized products and services.

In the fourth quarter institutional clients contributed 28% of total transaction value or about RMB 3.3 billion, at the same time we have established strategic relationships with well known enterprises in China which will support our business development and pave the way for further call operation in the future. [Foreign Language] According to the Asset Management Association of China, at the end of 2014 there were 7,358 registered private equity funds managers in China, managing 9,156 private equity funds with total assets of RMB 2.38 trillion.

We recognized the huge potential in the Chinese asset management industry and think that Gopher asset management is well positioned to become the industries leading fund of funds and MOM asset management company. In 2015 Gopher asset management will improve its performance in both asset management scale and investment performance and will provide diversified asset allocation and wealth management services to its customers.

[Foreign Language] Next I will share with our ladder of comprehensive financial services and developments. Noah glory [ph] insurance agency limited has been developing well.

Its primary products include high end medical insurance, general accident insurance, aviation accident insurance, serious and terminal illness insurance and whole life insurance. Our individual life insurance product line is essentially completely developed.

The high end medical insurance, serious and terminal illness insurance and term life insurance have become our three major products. Our life insurance policies, such as whole life insurance have also performed well.

By the end of 2014 of the 10,000 registered clients have purchased various insurance products through Noah glory insurance agencies. [Foreign Language] INOC [ph] education, the high end education brand that Noah invested in has gradually become the first choice of high network clients in its category.

By selecting and customizing global high end education it has established a comprehensive international curriculum. By the end of 2014 around 500 Noah registered clients and families had taken part in its customized classes focusing on private equity investment, hedge funds, inheritance of family wealth and more.

[Foreign Language] By the end of the fourth quarter our micro lending business have provides short term financing to over 371 customers with total loans extended – exceeding RMB 1.43 billion. The average loan maturity was 43 days and the average loan amount was RMB 2.9 million all of which were asset backed loans.

In 2015, as number of our internet finance platform clients and the scale of our business continues to grow, we plan to put our entire offline micro lending business online. Turning to internet finance, our new launched financial service platform UN Gumball which is designed for white-collar professionals in China grew significantly in the fourth quarter.

By the end of 2014 UN Gumball had established cooperative relationships with 205 enterprises in China with cumulative online sales reaching RMB 1.4 billion and generating a 32% compound monthly growth rate. The average customer order value was RMB 150,000.

[Foreign Language] Positioned as the private bank of white-collar professionals, UN Gumball has started to become the main online wealth management platform for white-collar professionals. In 2015, the platforms O2O [ph] model grew quickly due to an increasing number of clients and masoning clients.

Its outstanding performance also attracted a number of high quality strategic investors and we will complete our first round of strategic financing in the near future. UN Gumball offers high end financial services to white-collar professionals, including wealth management products, insurance products, educational programs, and employee benefit programs in specific client groups.

All of our online products are vigorously screened based on the qualifications of the management team, the management team’s professionalism, the risk control structure of the product and the rate of the return. UN Gumball helps to further expand our customer based for the potential high network clients of the future and enables them to experience Noah's products and service.

Aside from UN Gumball, Noah has launched VIP lending in 2014 to build an internet financing platform for high network clients and provide a transaction service platform for those clients with financing and investing needs. We believe the internet finance market is still in its initial stages and has great potential.

Through launching a whole range of complementary internet finance initiatives Noah will grab the opportunities and improve our market position. [Foreign Language] I would like to talk about the development of Chinese financial and regulatory environment.

As asset management enters the new era in China, asset management policies are becoming more open, especially for private equity management. The regulatory environment is also becoming more standardized.

As a market pioneer we understand our responsibility in setting codes of conduct for the industry. And in 2014 we implemented a qualification evaluation system for relationship managers to increase their professionalism and business compliance.

Gopher asset management continuously improves its internal processes and qualified investor management. That concludes my prepared remarks on our 2014 performance.

I will now turn the call over to Mr. Lam, so he can introduce himself and discuss our strategy and management direction in 2015.

Thank you.

Thank you. Thank you, Ms.

Wang. Hello everyone and I would like begin by briefly introducing myself.

Before joining Noah I was a Global Partner in McKinsey and was with McKinsey for 14 years. I was McKinsey's Head of Private Banking and Wealth Management and also co-led the financial services practice for Asia.

Noah was actually McKinsey client and served Noah and Ms. Wang for three years and worked closely with Noah's management for three years.

Based on my experience in the sector, I am very confident that the wealth and asset management industry in China will continue to witness strong growth in the coming decade. Noah has established a leading position in its market.

I like to thank the board and Ms. Wang for giving me the opportunity play a role in Noah's development.

I look forward to working closely with Chairman Wang and the management team to help build Noah, not only to be a leader now, but also for the longer term. In recent years Noah has tailored solutions to client needs, both domestically and abroad by offering a diversified set of product and services, while maintaining an asset life operation with established an end to end business model that covers top design, asset allocation, to client servicing.

We've expanded our offerings without comprising the quality of our products and services. 2015 is the beginning of our next 10 years.

In 2015, we will focus on building a sustainable platform that will support our tremendous growth over the next decade. We'll focus on three areas.

First, sustainably increasing the capabilities of mid and back office. Second, developing new growth engines.

Third, continue talent cultivation. I'll go over one by one now.

First, in terms of substantially increasing the capabilities of our mid and back office. We'll invest resources in our asset management systems and our functional systems.

We'll also continue to accelerate the development of our IT platform. We'll invest heavily in building our client data base, so that we can more effectively address client needs.

We have one of the most in-depth understanding of Chinese entrepreneurial clients and we want systematically leverage that. For wealth management enhancement, this is I've always believed that risk management is at the core of what we do.

Last year we continue to build our risk management systems Kinberty's [ph] In 2015 we will built a more comprehensive risk and compliance system, as well as independent compliance deposit in line with the regulatory requirements for our asset management business. In terms of our growth engine.

We basically were focused on few of that will be core drivers of our new revenue growth. First, is internet finance, second is discretionary management, third is our global platform and most of key growth initiatives for 2015 beyond our traditional business in wealth and asset management.

For our internet finance business, we've had a great launch with our UN Gumball product, which is the first Chinese first pure online private banking for white-collar professionals. We'll continue to accelerate its growth in 2015.

In the wealth management business we expect discretionary management to play its centrifugal [ph] role in our wealth management business. It plays to out strength as a high network service provider.

We'll continue to accelerate growth in that business. For our global platform, we will actively look for organic and inorganic opportunity to expand in Hong Kong and US.

In terms of talent cultivation, talent is at the core of what we do. In 2015 we will develop a talent by enhancing our incentive mechanism, implementing a new promotion scheme and providing training through all roads [ph] and professional certifications.

By developing the asset allocation skills and professionalism of our relationship managers and asset management professionals, we're working to cultivate the first generation of real private bankers in China. We are very optimistic about the future of asset and wealth management in China.

Based on recent research there are about 2.3 million high network families with an average of $3.7 million in financial assets in China. In the next 5 to 10 years we expect to see a enormous growth in demand for wealth management services from China to white-collar workers, high network individuals and families, as well as institutional clients.

As one of the leading wealth and asset management experts in China, Noah has established a unique and comprehensive financial service model covering wealth, asset management and targeted internet finance. The management team and I are very confident that the next decade will be an excellent one for Noah and we are building Noah for the longer term.

Now, I'll turn the call to our CFO, Ching Tao, to review our financials. Thank you.

Thank you, Chairman, Wang and Kenny. And hello, everyone.

In the interest of making the best use of everyone’s time, rather than reading through the financials that are disclosed in our release, I will give a high level of overview and highlight a few areas before we go into the Q&A. Firstly, you will notice that this quarter we begin breaking down our financials into three business segment, wealth management, asset management and internet finance.

We think this better reflects the overall shape of our more diversified business model and we'll continue reporting this way from now on. As for our fourth quarter performance, we're pleased to have ended the year with another steady quarter, both on the top and bottom lines.

Q4 net revenue increased just under 40% year-on-year and full year revenue grew 51% to US$247.9 million. On the bottom line, non-GAAP net income grew 37% to $77.7 million for the full year surpassing our prior guidance.

Our wealth management business was a dominant source of revenue in the fourth quarter of 2014 generating 80% of total revenues. Asset management generated 18% and the internet finance business generated around 2%.

Our continued efforts to diversify our product mix in the wealth management business were well reflected by our fourth quarter results. Of the 1.9 billion of wealth management products that we distributed during the quarter, fixed income products represented 63% compared to 84% in Q4 of 2013.

Private equity products grew to 19% of total quarterly transaction value, up from a 11% a year ago and equity linked and other products contributed 18% compared to 5% a year ago. You can find a breakdown of the operating metrics of our wealth management business in a table at the back of our earnings release.

Our effective commission rate for Q4 was 1.08% compared to 1.06% in the same period last year. It is also worth highlighting that recurring revenues accounted for 53% of net revenues in Q4.

This is a good reflection of the sustainability of our business model and as our asset management business continues to grow, you can expect recurring revenues to remain at a relatively elevated level, likely above 50% for the year 2015. We continue to see recurring revenues as an important tool to ensure revenue visibility and stability.

Before I go on to discuss our profitability, I want to briefly tough on the increase and related party revenues in Q4, which represented 42% of the total net revenues this quarter. The increase was primarily due to an increase in product distributed that are managed by our own asset management on Gopher as we mentioned earlier.

Our asset management business has been grown significantly and had about $8.1 billion in assets under management compared to $7.6 billion just one quarter previously. Turning briefly to our internet finance business.

We're pleased to see continued momentum in this business with fourth quarter revenues of US$1.2 million and full year revenues of US$2.7 million. We are still very much in investment phase in this business, so believe it will be an integral component of our integrated offering in the future and we're confident about the long-term prospects.

Now I'd like to discuss profitability. Operating margin in Q4 was 28.2%, compared with 29.2% a year ago.

The decline was primarily due to an increase in HR and IT infrastructure expenses as we continue to develop our internet finance business and other value added services. These investments should help us capture additional scale in our businesses and improve our margin profile over the long-term.

Non-GAAP net margin was 24.5%, compared to 32% a year ago. The decrease was due to utilization of a tax loss carry forward in 2012, so operating net margin was similar in 2013.

Non-GAAP net income was US$15.5 million in Q4 and US$77.7 million for the full year. Our balance sheet remains very solid and liquid.

As of the end of Q4 we had approximately $314 million in cash, short term and long-term investments, which is an increase of about $17.9 million from the previous quarter. Our business once again has generated positive operating cash flow in Q4 of $40 million mainly as a result of disciplined accounts receivable collection.

Accounts receivable turnover is about 60 days was inline with our long-term average, reflecting continuous stability in our operating efficiency as our business growth and scale. As Chairman, Wang and Kenny mentioned in their remarks, we plan to continue to expanding our businesses in wealth management, asset management, internet finance with potential investments in our acquisitions, our complementary businesses and related licenses.

Our aim is to build a more comprehensive financial platform that will allow us to further expand our customer base, diversify revenues, increase customer stickiness and improve the customer experience. With the need for these investments inline, the board of directors have opted not to issue an annual cash dividend for the year 2014.

We believe these investments will [ph] ease of our cash at this point in time and will generate greater value for shareholders in the long-term. Finally, I would like to comment on our guidance range for 2015.

With continued profitability in our wealth and asset management businesses, as well as significant revenue in customer base growth, we are expecting from a newly established internet finance business, we expect non-GAAP net income to be between US$90 to US$95 million for the full year 2015. The mid point of this range represents year-over-year growth of about 20%.

This growth rates reflects a strong fundamental in our business on the one hand and continued investment in our new business lines, primarily internet finance on the other. So with that, Chairman, Wang, Kenny and I would be happy to take any questions.

Operator?

Hi. Thanks for taking my call.

I had a question, you were discussing about the growth prospects because of the increasing amount of high network families and what have you going forward which should be fuddle [ph] grant for growth for your firm. What about the notion that the Mainland equity markets or federation markets are becoming more active and more buoyant.

Do you see that could be a tailwind for your business going forward?

Just a moment while we translate the question for Chairman, Wang.

[Foreign Language]

Actually Ms. Wang mentioned in her remarks the rating of the Asia market in China definitely will help us to become more diversified in term of product mix.

Actually in the beginning of the year 2015 we have already started to see the changes. The proportion of secondary market products, ancillary country build more in terms of our overall transaction value.

Great. Thank you.

Hi, good morning. Thank you, management.

This is [indiscernible] And I have a question, its sort of the high level question. So now that you have made transition to full financial growth covering various of your business lines.

So can management comment on the current competitive landscape in China and what do you think is your competitive edge? Thank you.

So we'll translate the question for Ms. Wang.

So maybe I'll answer for Ms. Wang.

This is Kenny here. The opportunity deed [ph] has intensified over the course of the year a lot, where we see a new set of players coming in, including internet finance players, third party independent players, insures trust companies and banks.

Now, I think we basically have three core competitive advantage that we think we will continue to invest in. One is we continue to invest a lot in product development and service development.

I think that’s an area that is hard to replicate by competitiveness. We currently have about 100 professional just looking at product manufacturing and selecting proper investment products for our clients.

And that’s something that a lot of the distributive products can't replicate, so that’s one area. Second is, our network, we currently have one of the largest coverage of high network clients in China with over 60 cities and 90 – over 90 branch offices across China.

And that’s something that’s very hard replicate and not easy to build in a short term. So we continue to invest.

And that – the branch offices that we have across China, not only those investment products, it’s actually those range of investments and to time in with services. So that’s a second advantage that we have.

The third that we have now is that we actually have diversified platform. So both on asset management that is through our only subsidiary Gopher asset management, as long as our internet finance platform, we actually have a broad set of platform that covers not only private banking for high network clients, but also asset management for institution investors, as well as UN Gumball platform which covers white-collar professional.

So that broad platform will help us build sustainably for the next 10 years.

All right. Thank you, Kenny.

That’s very helpful. And my second question is about, now there is concerns over macro slowdown overall.

So I was just wondering if that’s the case what type of products do you think will be more suitable or more like welcomed by your clients? Thank you.

I am going to try [indiscernible] while Ms. Wang is driving our product development directly.

[Foreign Language]

Actually we've seen the overall Chinese economy from two different prospects, the traditional industry such as import, export, has actually show quite slowing down in the recent years. But for the new emerging industry, such as internet, medical service and environmental, we have seen those industry start to grow quite dramatically for a lot of PE and VC form that are – we introduced to our customer, they invest in those emerging new industries and they already have good returns.

So I think going forward we'll be, I like saying be conservative, but also be optimistic in the future.

Maybe I'll also add a bit. I think what Ms.

Wang is saying is that, in our product development we're also shifting our focus to new industry, such as medical, new media, as well as quite a few other industry that we think are going to be substantially growing in China, particularly also in the environmental development in China. So we think that in terms of product development that’s an area that we also want to shift our focus to other industries that we think are going to be growth engine for China.

All right. Great.

That’s helpful. Thank you.

Thank you, guys. [Foreign Language]?

There are actually three questions for the management. First, Elaine will like the management to comment further about expansion of the internet finance business and also the institutional client’s base and how the internet finance business will impact our margins in year 2015?

The second question is regarding about your real estate proportion in the AUM – in the asset under management in year 2015. And also the third question is regarding about the most current status regarding about the Jing Thai [ph] case that we announced in the August of 2014?

So we'll answer one by one then.

[Foreign Language]

Great. I'll translate what Ms.

Wang is just talked about. So on the first question about internet finance and institutional clients.

On institutional clients we've actually built a team that is now sitting in Gopher asset management. We believe that organizational change is actually good one.

Currently the team is led by a former [indiscernible] executive and we are growing tremendously on an institutional client base. On internet finance, as I mentioned in my remarks and also in Jingbo Wang, we marked – the internet finance platform is actually targeted and growing tremendously.

We are China's ad based internet private banking for white-collars. We continue to invest in building ancillary services for this platform, where we will have the payments service, we will also have a secured lending platform, as well as connect that with relationship managers, physical platform to an auto platform.

The whole point of that is not just to be an internet finance, but to build a business that will become the feed for our high network business, who are focusing on white-collars and affluent clients now. But these are clients that in the next 5 to 10 years will be a private banking clients as well.

So these [indiscernible] internet finance platform growing at around 30% per month now is going to be a great feet for our future private banking business. On Gopher asset management, which is our asset management subsidiary, we want to be a multi boutique asset manager and want to be the top two in China across categories that we play it.

And currently we're focusing on a few key categories, private equity, private equity fund of funds, real estate, across all different types of asset classes, hedge funds and secondary market, as well as certain type of credit asset classes. And the way we're booted is beyond just focusing on those asset classes and becoming number or two in China, we are also good operational experience.

So recently we've actually taken over a office building in Huangpu, where we're actually operating directly. So we want to build operational experience as well.

We've invested around 40 funds in about 600 companies now. And so we continue to build our team.

We want to be the Blackstone of China, where we will be a leader in multi asset, multi boutique firm, so that’s our Gopher asset management subsidiary. In terms of the event that happened in August last year, we are actually – everything is actually proceeding on schedule.

We fully expect to recover principle and expected return on time for our investor. So everything is actually on schedule in terms of that particular incident in August 2014.

[Foreign Language]

Hi, Lee.

[Foreign Language]

[Foreign Language] So this is Ching, I will reply to the first and third question and Kenny will reply to the second. The first question was regarding our margin for 2015, and what trend do we expect do we expect to see.

The third question relates to average transaction value per client for wealth management business. In the fourth quarter it dropped.

And then the second question is regarding our continued investments in internet financing new businesses. So first of all, regarding our margins, we're seeing some margin compression which started last year and I believe there will be some reasonable math that may continue this figure, as we continue to invest in the scale of our businesses.

As you've heard wealth management, after management, internet finance are in their infancy in China and we expect the fundamentals macro wise in terms of high networks individuals and also enterprises and corporate’s meeting these types of services to be pretty huge. Our market share is fairly low.

So we are currently in the next couple of years investing in building scale for these new businesses and also correspondingly in the middle and back office strength and infrastructure to support the scale. What we really don’t want to do is to lose the market opportunity.

So we're focused on grabbing the market opportunity and building market share and over the long-term I expect that will allow us to have some margin expansion. But you know, the initial stages we may see some margin compression.

In terms of average transaction value per client, that declined from third quarter to fourth quarter due to the product mix. As we distributed relatively more fixed income and also equity, equity linked products, the average transaction value fell a little bit.

So transaction value will tend to have some volatility on a quarter-over-quarter basis due the product mix per quarter. So in any particular quarter for example, if we do more alternative related investments PE, VC funds, the average buying is much higher at RMB 10 million per product, so that will automatically pull up the average.

Okay. I'll take the second question, I just want to highlight one thing before I go – I talk about the investment.

The operating margin for our core business, the wealth management traditional business actually has improved substantially. And so that’s why I think in this quarters announcement we will provide numbers by segment as we think our businesses are in different stages and development.

Our core business has improved substantially. I think the fourth quarter of 2014 operating margin is 40.4% compared to 27.8% in the same period of 2015.

So it has improved substantially in our core business. In terms of investment, I think Tao Ching is absolutely right.

This year is about both growth and investment. As we mentioned, we will invest substantially in our roughly expanded internet finance business which is a very targeted business for white-collar professionals and private banking.

We'll also grow substantially our asset management capability and so that’s an area that we want to invest in. On our core business we will invest substantially in building profitable platform for operations in IT and those are three areas that we want to continue to invest.

So overall group margin may continue to decline due to those investment, but we'll actually look at our businesses very separately and our core business and our traditional business, wealth management, we expect the margin to be stable or improving just like we've done actually in this quarter, where we've seen a substantial improvement on margin for the traditional business.

Thank you everyone for joining us. We are looking forward to update you about our first quarter 2015 results in a few months ahead.

Thank you.

Great. Thank you.