CNFinance Holdings Ltd CNF Stock Analysis

About CNFinance Holdings Ltd

CNFinance Holdings Limited ("CNFinance" or the "Company") is a leading home equity loan service provider in China. CNFinance, through its operating subsidiaries in China, conducts business by connecting demands and supplies through collaborating with sales partners and trust companies under the trust lending model, and sales partners, local channel partners and commercial banks under the commercial bank partnership model. Sales partners and local channel partners are responsible for recommending micro- and small-enterprise ("MSE") owners with financing needs to the Company and the Company introduces eligible borrowers to licensed financial institutions with sufficient funding sources including trust companies and commercial banks who will then conduct their own risk assessments and make credit decisions. The Company's primary target borrower segment is MSE owners who own real properties in Tier 1 and Tier 2 cities and other major cities in China. The Company's risk mitigation mechanism is embedded in the design of its loan products, supported by an integrated online and offline process focusing on risks of both borrowers and collateral and further enhanced by effective post-loan management procedures. CNFINANCE HOLDINGS LIMITED Unaudited condensed consolidated balance sheets (In thousands, except for number of shares) December 31, 2025 June 30, 2026 RMB RMB US$ Assets Cash, cash equivalents and restricted cash 338,188 252,349 37,192 Loans principal, interest and financing service fee receivables 2,487,819 1,944,447 286,576 Allowance for credit losses (314,049) (159,847) (23,559) Net loans principal, interest and financing service fee receivables 2,173,770 1,784,600 263,017 Loans held-for-sale 3,508,003 3,087,619 455,059 Investment securities 273,442 277,377 40,880 Property and equipment 177,700 175,788 25,908 Deferred tax assets 318,346 339,137 49,983 Deposits 91,278 84,292 12,423 Right-of-use assets 11,760 11,760 1,733 Guaranteed assets 1,645,128 1,555,313 229,225 Other assets 1,711,504 1,552,519 228,813 Total assets 10,249,119 9,120,755 1,344,233 Liabilities and shareholders' equity Interest-bearing borrowings Borrowings under agreements to repurchase 2,766,434 2,615,591 385,490 Other borrowings 673,141 402,584 59,334 Accrued employee benefits 7,918 4,928 726 Income taxes payable 259,789 200,697 29,579 Deferred tax liabilities 80,737 69,137 10,190 Lease liabilities 12,236 12,236 1,803 Credit risk mitigation position 1,074,211 1,053,976 155,337 Other liabilities 1,794,011 1,587,089 233,908 - - Total liabilities 6,668,477 5,946,238 876,367 Class A Ordinary shares (USD0.0001 par value; 18,000,000,000 shares authorized; 1,559,576,960 shares issued and 1,371,643,240 shares outstanding as of December 31, 2025 and June 30, 2026, respectively) 917 917 135 Class B Ordinary shares (USD0.0001 par value; 2,000,000,000 shares authorized; nil shares issued and outstanding as of December 31, 2025; and 2,000,000,000 shares issued and outstanding as of June 30, 2026) - 1,357 200 Treasury stock (124,680) (124,680) (18,376)) Additional paid-in capital 1,046,619 1,046,619 154,253 Retained earnings 2,671,347 2,271,866 334,832 Accumulated other comprehensive losses (13,561) (21,563) (3,178)) Total shareholders' equity 3,580,642 3,174,517 467,866 Total liabilities and shareholders' equity 10,249,119 9,120,755 1,344,233 CNFINANCE HOLDINGS LIMITED Unaudited condensed consolidated statements of comprehensive income (In thousands, except for earnings per share and earnings per ADS) Six months ended June 30 2025 2026 2026 RMB RMB US$ Interest and fees income Interest and financing service fees on loans 380,218 87,680 12,922 Interest income charged to sales partners 32,567 805 119 Interest on deposits with banks 2,868 1,005 148 Total interest and fees income 415,653 89,490 13,189 Interest expenses on interest-bearing borrowings (271,727) (177,912) (26,221) Total interest and fees expenses (271,727) (177,912) (26,221) Net interest and fees income…