Good morning, everyone. Thank you for joining us for Ping An's 2020 interim results announcement. I am your host, Sheng Ruisheng, board secretary and brand director. Due to the impact of COVID-19, we can have the investors overseas to joining us, so we offer a face-to-face meeting, a live webcast, and a conference call simultaneously for this presentation. The management team attending the meeting today includes Chairman, Mr. Peter Ma; President and Co-CEO, Mr. Xie Yonglin; Co-CEO, Jessica Tan; and Co-CEO, CFO, Jason Yao; and Chief Investment Officer, Chan Tak Yin, and Chief Insurance Business Officer, Lu Min. So for the announcement, Jason will talk about the interim results of the first half of 2020, and then Mr. Lu Min, Mr. Xie Yonglin, and Jessica Tan will talk about different business segments, and then there will be a Q&A session. So Jason, please.
Ladies and gentlemen, good morning. Welcome to the Ping An 2020 interim results release conference. Thank you for your consistent confidence in and support to Ping An. Now, let me talk about Ping An's overall business operation and financial performance in the first half of this year. Please turn to slide 5. In the first half, the unexpected COVID-19 epidemic brought severe challenges to the entire market, and Ping An quickly responded after the outbreak by deepening online operations, strengthening risk management, and optimizing asset allocation to deal with the challenges, and we delivered stable performance. Going forward, despite uncertainties imposed by international environment and economic situation will continue to remain, we see opportunities.
Financial industry will have stronger demand for fintech solutions, given the rebounding and growing demand in risk financial services, and the pandemic prevention and control has also provided a catalyst for technological application and development opportunities in healthcare services. On slide 6, you can see our strategy map. Ping An has been committed to becoming a world-leading technology-powered retail financial services group, and we continue to push forward a finance plus technology core businesses. On page 8, despite complicated and challenging external environment, as well as disadvantages faced by our business operation, all businesses of Ping An have recovered quickly with stable performance. And our group delivered 1.2% OPAT growth, and interim dividend per share increased by nearly 7%.
Annualized group operating ROE was close to 22%, and annualized, life and health operating ROEV was about 19%. Affected by COVID-19 and volatility in the capital market, our net profit attributable to shareholders dropped 29.1% year-on-year. On page ten, Ping An has promoted retail business by implementing integrated finance model, featuring one customer, multiple products, and one-stop services. Affected by COVID-19, our retail profit slightly dipped 2%, accounting for 88% of total OPAT. On page twelve, there is a breakdown of our group operating profit. Group operating profit rose 1.2% year-on-year in the first half, but some of our businesses were impacted by COVID-19, and we hope the pressure will gradually ease as the economy recovers.
Our ROE on page 13 was close to 22%, and given the deep reform, our annualized ROE was close to 40%. On page 14, we'll see a net profit to our preferred operating profit metrics. So the investment variance was about CNY 2 billion, and reserves CNY 3.6 billion. On page 15, we can see the L&H OPAT. So in the first half, our life and health OPAT rose 7%, due to residual margin released into P&L, and this accounted for 68% of pre-tax operating profit. Despite the slowdown of new business growth, our residual margin balance rose 5% year to date to CNY 962.3 billion....
On this page, 16, we can see that 73% of the residual margin was released into the PNL, pertaining to long-term protection products. While the residual margin slightly declined to an annualized 4.4% in the first half, given the slowdown in new business growth, but in the long term, release rate will gradually slide with increasing risk of in-force business. On page 18, interim dividend distribution, we attach great importance to shareholders' return and have been increasing dividends in the past few years. We increased our interim dividend per share to HKD 0.80 in light of stable business performance and adequate solvency. That's interim dividend per share rise of 7% year-on-year. Our full year dividend will be linked to our full year operating profit.
So on page 19, our free cash flow. In the first half, we increased our dividend payout and implemented share buyback, so our free cash flow position remained healthy. And on page 20, we can see that as of the end of June, the Group and our major subsidiaries, including Ping An Life and Ping An Bank, continued to maintain solvency ratios significantly above regulatory requirements. Slide 21, we implement regular stress tests on solvency ratio to ensure that it is adequate, even in a hard-hit economic scenario. So we have two stress tests. One is assuming the equity assets decline of 30% in fair value, and the other is that interest rates will decline by 50 basis points. However, our solvency ratio is maintained much higher than required.
On page 23, our insurance investment portfolio mix maintained stable growth and reached CNY 3.4 trillion as of the end of June. We increased investments in long duration and low risk bonds in the first half to lengthen our asset duration and further narrowing our asset liability duration gap. The overall asset allocation is stable. So on page 24, you can see a breakdown of our investment portfolio category under IFRS 9. We adopted IFRS 9, and 17.2% of investment assets are mark-to-market through the PNL, causing significant volatility to net profit, and that's why we want you to focus on our operating profit.
In terms of investment return, on slide 25, declining interest rates have imposed grave challenges to the investment, and we responded actively by adhering to high quality asset liability management. You can see that in the last 10 years, our comprehensive investment yield averaged at 5.5%, while above our long-run EV investment return assumption of 5%. In the first half, there was very high volatility in the capital market. Our investment for portfolio delivered an annualized net investment yield of 4.1%, and annualized total investment yield of 4.4%. On page 26, we place high importance to investment risk management and constantly improve our internal controls. First, we extended our asset duration and narrowed our asset liability duration gap.
With higher volatility, we embedded our regular stress tests in our asset allocation process and increased stress testing frequency and intensity during more volatile periods. In addition, we have also leveraged technology to enhance our post-investment management. This is page 27, and it's a breakdown of our non-standard debt assets and investment yield. So the average duration, the remaining duration of our non-standard debt assets is 3.7 years, and a general nominal yield of 5.69%. So far, we have had 0 default of non-standard debt, and overall risk is under control. On page 29, we have placed great importance on ESG, and we have communicated constantly with investors about our ESG strategy. In the first half, our overall ESG rating has improved, with MSCI's ESG rating upgraded to A.
Ping An became the first and only Chinese financial institution being included into the Dow Jones Sustainability Index. On page 30, we listed some of our external honors and rewards. Our brand value has continued to improve. In a recently released, Fortune Global 500 list, we ranked 21st.
... And that's our financial result. Now, Mr. Lu Ming will talk about our retail integrated finance and insurance business.
Okay, thank you, Mr. Yao. Coming up, I'm going to take you through our retail integrated finance insurance business results of the first half this year. I'll begin with the retail integrated finance business. Please turn to Slide 33. So on Slide 33, we're showing you our retail OPAT drivers. In the first half, due to the COVID pandemic, our operating profit per customer slightly declined, but the continuous increase of number of retail customers and contracts per customer has driven the growth of retail operating profit, which only dipped slightly by 2%. Right now, we have 210 million financial customers. We have 2.69 financial contracts per person.
We believe, there's gonna be further growth, given the continuous developments of Group's financial model. In the first half, we acquired over nine- eighteen point zero nine million new customers, in financial customers, of which six point four million were sourced from our internal user base. So we supply some kind of online services first, and then we're gonna sell them a financial product, so that we can convert them from a user to a customer. On Slide 34, this is about customer users and cross-selling penetration. On this table, you can see we now have 560 million internet users, among which 376 million internet users have yet to purchase financial product from Ping An. Which to say, we still have a huge potential to convert our users to customers.
At the same time, we have registered great achievement in cross-selling since 2015. The percentage of retail customers holding products from multiple business units has risen from 19% to 37% now. As you know, our customer base has doubled over this period, and many of our incremental business customers has only purchased product from one of our subsidiaries. So this really is a remarkable accomplishment. I'm gonna move on to talk about our insurance business on Slide 36. I'll start with the life business reform. Given this new context, the traditional life insurance model are facing challenges for the sustainable development, like marketing, macro environment, consumer demands, demographic dividends, and the technology applications are raising the bar for the insurance business.
To cope with these challenges, and to maintain a high growth and sustainable growth of the life insurance business, our life reform is definitely necessary and inevitable. Our reform pool the resources and strength for the entire group to leverage on our professional team, quality agency, and powerful integrated financial product system, and our leading technological capabilities. The four key advantages are making sure our reform projects are executed. On Slide 37, our life insurance reform is deep and comprehensive, which cover product channels, data-driven operations. In terms of strategy, we developed differentiated competitive advantage in products through customer-centric approach, and built a life insurance plus product portfolio. We built a high productivity, high income, and high quality agency force by utilizing technology to empower agents. Also, we implement comprehensive data-driven operation to digitalize our life insurance business.
Our goal is to build a long-term, sustainable, and healthy growth and lay the foundation for us to become a world leader in life insurance. Now, Slide 38. Given this, COVID challenge, our life and health ROEV has been, 19% annualized basis in the first half, maintaining at a high level. At the same time, we have adopted a conservative, risk discount rate at 11%, which depressed reported EV, but leads to a bigger in-force unwind. Next, Slide 39 show you the NBV by channels. In the first half, our life NBV, given the COVID impact, fell by 24%, mainly due to the NBV decline in agency channel and telemarketing, internet, and other channels. Slide 14, we are presenting you another view, another breakdown of our life, insurance NBV by different drivers.
The 24% overall NBV decline was mainly driven by the 8 percentage point decline of NBV margin compression, and 8% decline in first year premium. So the two combined drive 24% decline. NBV margin contraction was mainly due to two reasons. Firstly, the agency's offline business development has been hampered due to the COVID-19, making it difficult to see customers and meet customers face-to-face. So, a lot of sales activity has been—Well, we've been focusing on long-term protection business, where face-to-face interaction is necessary. Thus, this has been weighing on our high-margin protection business mix. And so we have been actively adjusting the product strategy so that we are boosting sales of some low-margin online product, which is simple to sell, so we can accumulate customer resources. And that factor has also affected our NBV margin.
Now, on Slide 41, we're gonna look at the agent channel, which accounted for 89% of the overall MBV in the first half. The unexpected COVID pandemic has make our agents' offline business development more challenging, especially sales of high-margin production business, thus compress our agent productivity, and the recruitment has become more difficult. Our recruitment, average agent number declined by 10% year-on-year, and offline recruitment become more challenging, and our agent channel MBV declined by 23.5% year-on-year. On Slide 42, we're looking at the agent, agency force. Right now, the number of the headcount has stabilized and gradually recovering, increasing by 1%, quarter-on-quarter in the second quarter. We are focusing more on quality recruitment. We are strictly controlling the process of recruiting new agents. We have been tightening our recruits so that, they are of higher quality.
Now, thanks to our comprehensive, integrated financial strength of the group, our cross-selling has been increased massively year-on-year, so that, our take-home pay only fell by 7% in the first half. Our quality of the agents continued to improve. Right now, we have over 100,000 high-potential agents. Those, you know, where almost 34% of the new recruits holds college degree or higher. On Slide 43, it shows our how we empower our life insurance business by technology, and we have registered a lot of success. In terms of online recruitment, we have live-streamed 123 sessions and presentations of career forums, and we have attracted 40 million views. In terms of digital marketing, as you can see on the charts, we have the AI training, and we have the AskBob, this chatbox.
There has been massive increase of usage. We have 190 million use of AskBob in the first half, and the smart meeting rooms, where we can deliver a, an online presentation and also going. Right now, we can hold nine people. In September, we can hold 30 people sessions. And also, we have a AI training platform, which are able to simulate scenarios for training. So in life insurance agents, there has been broadly welcomed by the agents. On smart customer services, we have provided services to 110 million times of users, and which accounted for 99.8% of customer services, and 50% of the claims are settled within 30 minutes by our online channel. Now, let's look at the P&C business on Slide 44.
In the first half of the P&C, gross written premium rose by 10.5%. The non-auto insurance premium increased by 27.1%, and its mix continued to rise. Our overall combined ratio was 98.1%, still outperforming the industry. Due to the COVID impact, our temporary disruption has caused increase of guarantee insurance combined ratio. However, the pressure has or will gradually ease in the second half as the pandemic impact recedes and economy recovers. COVID is not likely to have a substantial—will not have a substantial impact on the future development of guarantee insurance business. Now, Slide 45.
P&C's operating profit dropped by 17.6% year-on-year due to the COVID pandemic and the capital market, but it still managed to deliver a 17% annualized operating ROE, overall remaining resilient. Now, I'm gonna, on Slide 46, I'm gonna talk about how P&C leverage technology to enhance business. On the auto insurance, Ping An Auto Owner app is the largest automotive tool in China, and top the list of auto service apps in China with over 109 million users, offering users one-click claim services and one-click policies. And over 93% of customers use this one-click renewal to renew their insurance policy. And also, the P&C insurance, we launched the Ping An Qiyebao, which is an app and mini program. It provides the corporate customer with risk management services.
That is our retail integrated finance insurance business. I will hand over to the Group's President and Co-CEO, Mr. Xie Yonglin. He will take you through our corporate integrated finance and banking business. Thank you. Thank you, Mr. Lu. I will present to you some of the progress and success on the corporate integrated finance and banking. Firstly, on slide 49, let's look at the corporate integrated finance. On this slide, we highlight some of the key tasks. We continue to refine our management of customers, and to provide differentiated management. For strategic customers, we focus on one account per customer, so that we can use the complicated, sophisticated investment financing model. For local key accounts, sophisticated investment financing plus supply chain, so that the local subsidiary can tap into the group's resources to present differentiated advantage.
For small and micro medium customers, we use a broad platform and over accounts, so that the finance and non-financial services can be delivered through a uniform platform, so that we can open to the scenarios, so that we can acquire customers in batches. So we have three major models of the corporate integrated finance, including simple standard model, sophisticated investment financing model, and transactional collaborative model. After a year and more, we have been clarifying and streamlining our concepts. So we're able to build concepts to empower different business lines. For example, in the standard and simple model, we are building the four connects on one platform, including account connect, data connect, product connect, and benefit connect, which is a uniform customer development and service platform.
Which is to say, we're using a retail mindset to operate our business for the small and medium and micro business. For sophisticated model, we use direct financing and indirect financing, which is the commercial banks, investment banks, so that we can leverage our group strength, so that it become a killer business to serve the big customers. In transactional model, we have been enhancing our transactional capability, like in, like trading bonds. In the first half of our ROE, ROA, has improved by 23 bps year-on-year. We outperformed the market benchmark by 81 bps. So we're becoming more down-to-earth. It's no longer just a functional and management department. It's becoming empowering arm and efficiency. On this slide 50, we demonstrate some of the metrics, and the metric has been quite healthy.
In the first half, our insurance for the corporate customer grew by 168%. The comprehensive financing balance grew by 170%. As you recall, last year, we also grew by over 100%. And also, synergy between retail and corporate integrated finance has gradually unfold. The corporate business continued to place role, and also we can see a growth by 9% year-on-year, by referring retail assets and source underlying assets for insurance fund by 35.8% year-on-year. In the future, we're gonna have more scenarios, and the interaction between retail and the corporate integrated finance, we're gonna see some explosive growth in this sector.
Now, let's move to the banking business. Slide 52. 2020 is the first year of Ping An's new three-year strategy. Despite COVID, Ping An continued to push forward data-driven and online operation. As a result, our business volume recovered quickly, and our business operation remains stable. We had double-digit growth. Our non-interest income increased, while our liability cost rate declined by 27 basis points, and we also maintained reasonable level of net interest margin. Due to the pandemic in the first half, we increased provisioning and write-off to deal with potential risks, according to prediction on the environment. While Ping An Bank also reduced fees and lending rates to support the real economy, especially the SMEs. These are extraordinary measures taken in extraordinary times. Let's take a look at the asset quality.
The numbers show that our asset quality remained stable despite COVID, and our NPL ratio maintained stable rate, and it's 3 basis points lower than the beginning of the year. And also, the delinquent loans remained very low, below 1, and only 94 were 60 days overdue. At the same time, we increased 32 percentage points of our provision coverage ratio. And also we increased the 36% of our provisioning for overdue loans. And page 54 talks about our capital adequacy ratios. Our capital levels continue to remain above regulatory requirements.
In the first half, we issued 20 billion of perpetual bonds, and in the first half, we issued another 30 billion perpetual bonds, further boosting total capital adequacy ratio, and we chose a very good window of opportunity, and the interest rate was much lower than the market average. We have now delivered a virtuous cycle between capital consumption and capital supplement. 2020 is the first year of Ping An Bank's new three-year strategy. This is on page 55. We continue to strive to become a world-leading, technology-driven retail bank. In the next three years, we will leverage the ecosystems of the group to become a digital bank and a platform bank and an ecosystem bank, and to build a brand-new balance sheet that is more stable and sustainable.
We also have four strategies, including data-driven operations, online operations, comprehensive services, and ecosystem-based development, and we will build another new retail business. For corporate business, we have five trump cards, and we will use the differentiated model of commercial banking plus investment banking and investment model to serve the real economy and SMEs. For our interbank business, we have three new directions so that we can empower smaller banks and to build the strongest FIC business. On page 56, we'll talk about the operations and our revenue and operating income before impairment loss of retail banking was up 12% and 17% respectively. On the debt side, we are proactively reducing liability cost. Retail deposit has increased 10.1% year to date.
In terms of retail banking, our retail AUM exceeded CNY 2.3 trillion, leading among joint stock banks, with number of customers exceeding 100 million. COVID-19 has had a big impact on consumer loans. However, three years ago, we started tightening risk strategy, so our retail risk indications are now better than industry levels. With the macroeconomy improving, the retail asset quality is expected to gradually return to normal. We focus on loan risk, mortgage, and licensed mortgage balance, so accounting for 32.2% of personal loans, up 1.9 percentage points year to date. Private banking and wealth management maintained a rapid growth, with AUM of private banking increased by 25.8% year to date, and number of wealth management customers increased by 13.3% year to date. Slide 58.
Our retail banking continued to strengthen our data-driven operation capability. Not only did we help the resumption of work and production during COVID, we also greatly optimized the overall operating efficiency and cost. So our average retail AUM revenue per outlet was up 45% year-on-year, and a monthly average number of customers served by AI grew strongly by 365%. That means our investment in technology in the last few years started to show results. For example, so the time that we approve loans has been reduced to 10 minutes, and our AI voice calls have now replaced 3,000 telemarketing representatives. And the group channel has played an important role in developing retail banking and had outstanding contributions to both quality and quantity.
About 30% newly issued credit cards and over 60% of Xinyidai loans. Among new retail wealth management customers, 43% were sourced from Ping An Group. And in terms of quality, customers referred from the group have higher quality. The NPL ratio of Xinyidai referred from the group is 0.74 percentage points lower than Xinyidai's overall NPL ratio. So we will use this trump card increasingly, frequently going forward. So slide 60 shows our performance on corporate banking. We successfully resolved risks and reallocated resources in the past 3 years, and the corporate business has grown steadily. Meanwhile, corporate banking continued to optimize liability structure and revenue structure, with average cost rate declined by 14 basis points year-on-year, and corporate net non-interest revenue grew strongly by 27.8%.
We also implemented the specific requirements of the CPC Central Committee and the State Council on supporting business entities. So we supported private enterprises and SMEs with a balance of inclusive small and micro business loans increased by 7.73%. The sixty-day overdue NPL ratio also decreased. On page 61, as the engine of one plus N model of corporate business, Ping An Bank has achieved remarkable results. Our premiums referred by the bank increased by 271% year-on-year, while the PAB in cooperation with the group, the projects implemented rose by 154%. This has not only helped other subsidiaries, but also enabled our bank to gain more fee-based income and optimize our revenue structure.
In the first half, our interbank trading business has reached CNY 4.6 billion. The interbank institutional sales volume increased by 73%, and our NAV management has exceeded CNY 400 billion, up 57% year-on-year, leading in the industry. Our wealth management subsidiary started operations today, and in the first half, our transaction team stick to their jobs and continue to provide liquidity to the financial markets. When the market opened on February 3rd, more than 80% of the best offers in the interest rate swap market came from Ping An Bank. Page 63, it's about technology application. In the first half, we have over 8,000 IT staff, increased by over 13%, with IT investment grew by 25% year-on-year.
Going forward, Ping An Bank will continue to rely on the core technology resources of the group and accelerate the integration and implementation of new technologies, such as artificial intelligence, big data, blockchain, digital currency, et cetera, with specific business scenarios, enhanced capabilities of customer management, operation management, risk control, and so on. Now, let me hand over to our Co-CEO, Jessica Tan, to talk about our technology business. Good, good morning. Please turn to page 65. I will give you a quick summary of our technology business for the first half. We continued to build leading technologies, and to ensure that our technology can empower our main business lines and to develop our ecosystems. First, you can see that we've made a lot of breakthroughs.
We filed over 26,000 patent applications as of June 2020, and in the financial sector, we ranked number 1 in fintech patent applications for 2 consecutive years, and number 2 for digital health tech patent applications. Ninety-six percent of them are inventions. That shows that in the last 12 years, we invested so much in basic technology and application technologies. As Mr. Xie said, a lot of the underlying technologies were developed by us. And we also have a lot of application cases, whether in insurance or in banking. So AI-driven product sales reached CNY 176.3 billion in the first half, and average daily productivity of service representatives reached 131.3 times per person.
Then 57% of the service sales will be conducted by AI-empowered robots. And we also enhanced our efficiency, whether it's collection or answering customer calls, we were able to use AI to increase productivity. In the last year and a half, we were able to save labor force of 12,000 people. And with the rapid growth of our business, we also enhanced our technology capabilities.
... Well, you can see, we see an 11.2%, and, well, the profit grew by 22.7%. Next slide, on slide 66, are some of the examples of investment. 96% of the patents are invention patents, but in what fields? Like AI, particularly in the smart understanding. It's not about identifying who is who, but they can read and identify complicated text, like legal text, financial, medical text, both in Chinese and English. We're in a leading position in the language recognition. We have a competition where we read a hundred, you know, reading and answering 150,000 questions after reading a text, and we are number one. We score 90.9, 90.9% compared to 86 points scored by a human.
So which is why 82% of the representatives are handling calls by robots. They can listen, they can understand, they can comprehend what's being said, they can reply intelligently. Again, in health tech, we have a lot of investment, and in the first half, in The Lancet, on the Nature journals, and some of the best-known journals, they have been publishing our AI health tech papers and theses. As you can see, our AI, we called AskBob. They cover 170,000 hospitals and 43,000 doctors in China, Indonesia, Philippines, and Singapore. They're being used now. So this is remarkable. It's very important by using this health tech, the healthcare professionals has been able to assist it in their diagnostic capabilities. And well, 86%... They can be up to 86% of our general practitioners.
Now, on slide 67, we talk about empowering this, the core business. We talk about reducing costs, reducing risk, and increasing efficiency. This is what it's all about. We talk about reducing costs. We talk about the Gamma Voice, which is a cloud-based robot. We use it for 860 million times this first half. At 69 financial institutions in China, we provide cloud robots, and they have been using 1.16 billion times this first half. Now, they're not inducing costs. The corporate, you know, risk, loan risk, we're using AI. Well, in AI collection, for example, M0, M1 collection, almost all the M0 and 30% M1 are being collected by AI. Well, it works better, and we have less complaints because they are more friendly as a reminder in collection.
So people are going to focus on more important and complicated risk management and in the collection. So improving efficiency, Mr. Lu talked about the AI agents. We pioneered AI interview and AI business development, AI training, the online customers, you know, social marketing. There's a host of tools for our, you know, operators to improve efficiency. Next slide. On slide 68, we talk about 11 tech firms and how are they doing. So our technology companies are in four stages: building platform, attracting traffic, revenue, and contributing profits. In the first half, now, due to this COVID pandemic and some of the favorable policies, we have seen pretty good progress. The three listed companies, like Good Doctor, the OneConnect, Autohome, the market cap has been rising by 53% year to date.
So that is really thanks to the, you know, approval by the institutional investors, hence the increase of the, market cap. On slide 69, Lufax Holding. Now, the Lufax, in terms of the managing, the, the, you know, the, outstanding, loan growth on the higher, support to the small, medium, business inclusive loans, which is a 12.4% growth. And secondly, in the wealth management, the AUM grew by 8%. And in terms of structure, it has—we have also make adjustment to the structure. You see, we have more to-be cooperation. We work with over 400 financial institutions, 34% of the business come from these institutional, you know, organizations.
We're adopt an open mindset to reach out to other banks, to other financial institutions, so that we can work with them. In terms of quality management, we have been focused on quality a lot, which is why we are disclosing the 30-day overdue ratio. 30-day plus overdue was 2.9% the first half. Compared with last year, it was 0.7% higher, but still, it's manageable. And the Q3, we see the 30-day plus overdue was, actually decreasing now. The second on slide 70, this is a OneConnect. We're saying OneConnect is putting all the fintechs, not just we are using it, but we are providing to, you know, 92 insurance company and 630 banks, and also 7,000 financial institutions.
It's in 14 countries other than China, in Southeast Asia, India, East Asian, even in European countries, the smart claims, smart representatives, smart loans, we are providing services in those countries. You can see in the first half, revenue growth was remarkable. Overall speaking, it's up by 39.7%.... And 70% are recurring transactional revenue. This is a key metric. You can see why the capital market really like this software as a service. The SaaS model has been really gaining traction, because this is really a sustainable recurring revenue. Now, on slide 71, Ping An Good Doctor. In the healthcare, we will have high ecosystem, you know, healthcare among, like, others, like auto. Now, health, Good Doctor is our flagship. In the first half, because of the COVID pandemic, we have been promoting the online internet healthcare.
We think healthcare can really provide better services online and offline. You can see in the first half a daily consultation was 830,000 daily consultation, equivalent to 75% of tier-three hospitals. We have 110 million consultation in the first half. Financially speaking, we grew by 29.9% of the year-on-year growth. It's worth noting that 25% come from the online healthcare revenue, which is quite precious, because it really double accounting for 25% in the contribution. And Good Doctor will also work better with the ecosystem. We're not just an online internet healthcare flagship, we want to reach out to the offline players. So we have 1,800 healthcare program.
As you can see, we have a few hundred renowned physicians and 10,000 specialists, so we can connect with all these renowned consultants and specialists, so we can provide better services. Next, on slide 72 is Autohome. Autohome, now, in the first half, the auto industry was badly hit by the pandemic. The new car vehicle sales dropped by 22.4%, but Autohome has been able to maintain growth. Our revenue was only impacted by 1.6%, thanks to what we have done in the last four years, where we continue to drive this new business model. It's not just about selling advertisement or selling leads. We are doing auto financing, auto services, and auto operation. And 22% come from what we did in the last four years, coming from this new business.
So if you look at the traditional business, it was actually down by 9%, but new business grew by 36%, which is why, given such challenging time, we maintain a stable growth. On slide 73 is about smart city business. Smart city, in the last two and a half years, this is new company and smart business as a ecosystem, and it can connect better with other financial services. And they have been growing pretty fast. During the COVID pandemic, we can see many governments, they are putting their government services to the companies and citizens during this period. In the government services, we provide 52 cities with services. We're using technology to help the local government, local business streamline and simplify. Something that takes 7 days is now shortened to 1 hour.
And also, we are providing service to the citizens to streamline the government services so that citizens have better access. We cover 17 cities now, with over 20 million citizens covered by our service. In the first half, we have 1.18 billion in the services deliveries, so the government can serve them better. In Shenzhen, we work with Shenzhen government. We have the iShenzhen app, so that the 70 million Shenzhen citizens can be served online, and they don't have to go to the government departments. And also, we have also 20 million registered users. And also, we talk about Good Doctor, which is online healthcare and working with online.
In smart city, we have a smart healthcare team, where we focus on working with the health commission to provide this, you know, the 8 million healthcare professionals, increasing their quality, serving some. We are covering now 90 cities to work with the health commissions, serving 17,000 healthcare institutions and providing 413,000 physicians. So we're saying we're helping the doctors and helping them to manage... We have we have 2 million diabetic patients. They they are being managed by these online services. And also smart education. As you can see, education is highlighted in this pandemic. We have over 2,200 companies where we provide services. We have over, you know, 3 million...
We have 26 million streaming courses, where we cover 160 cities, where we have 68 million citizens being covered by this smart education program. So, with that, I have concluded my presentation. Our appendix table, a lot of, you know, information regarding the variance, profit variance from different lines of business for your reference.
Now, thank you. I will take any questions now. Thank you. We now move on to question and answers. We'll take questions from the floor and also alternate questions from the phone lines. So please refrain from asking more than one question, and please identify yourself, your organization, your name, before asking the question. Shall we start by question from the floor? The gentleman sitting in the middle.
Hi, good morning to your management. I'm from China Merchants Securities. My name is, I'm a researcher, Zheng Jisha. My first question for the management, well, for—it's actually Chairman Ma regarding the reform. Can you specifically elaborate some of the milestones or targets for reforms? How are you going to get there? When are you gonna get there? And how are you going to evaluate how well it has been done? Mr. Ma, you have shared experience yesterday. One point that I have noted, you talk about you will take two to three years to complete this reform process. So I'm interested, when you talk about two to three years, when does it start, and when will it end, and to deliver some milestone to show us? Thank you.
Well, let me just talk about the life insurance reform. Well, we're starting from 1994, so that's been 25 years. Mr. Ma has been saying we're gonna start again after 25 years. So this is the second round of reform. The first was in 2004. At that time, our reform was rather painful. Painful but effective. We have three reform back then. The first, we have we are leaving, we are, you know, we have 320,000 agents reducing 200,000, that was painful, and there's a profit. Unit link changing and moving into production type of insurance, that was difficult. Third reform was on channels. The banker channel. Banker channel was a low in margin, so we changed to agency channel, which is higher margin.
That was the first round reform, and that took us two to three years, painful years, but you can see it set the tone, set the foundation for our growth for years to come. So the second reform was starting from the second half of 2018. As you recall, at that time, we have been saying the life insurance, it's time for another round of reform for life. For simple reasons, the life insurance for the past decades, there have been ups and downs massively. There has been a lot of ups and downs. But we believe reform involve four aspects. Firstly, the changing the model of our growth. It's not just about the size, but size and quality matters as well.
And the second reform is institutional. In the past, we relied on people from management. From the headquarters to the agents, there are seven layers. It's a pyramid shaped model. So now we're using digitalization, a four direct from HQ to the business unit, to the agent, and to the customer. So digitalization is also a very difficult reform because it changes behavior. And the third reform is product innovation and product strategy. We sold a lot of high-margin protection product, but we also pushed forward integrated finance and life plus products. Insurance products look very complicated, but they are more or less the same. The only difference is in the price. But in the long term, we believe a good product is life plus health, plus retirement, plus education. So this is a reform of our product policies.
And then the fourth reform is in channels. So how can we sell more policies online? And how can we combine online and offline capabilities? So these four reforms, business model from quantity to quality, and number two, institutional reform, to reduce the reliance on people and rely more on the digital technologies. And then the life plus reform, as well as the channel reform. And all of these are challenging tasks. So we don't just want scale, we also want quality, and you have to set new standards, and people won't like it. So you can see that it had an impact on our first half results. So it's not just COVID-19. Mr. Lu said we sold a lot of high-margin protection products, and that relied on face-to-face interactions.
But we also reduced some low productivity agents. Every agent has to build customer resources and to have face-to-face interactions and to sell life products and then to increase their efficiency. And there are over 300 indicators to measure their performance. And also from the policy product quality side, Chairman Ma wrote in the shareholder letter that this is a very difficult task, but we are confident that the transformation will be successful. We started in the second half of 2018, and the second phase started in the second half of last year. So all 15 different reform programs are in progress, and I believe we are on track to reach our target to complete the reforms by the end of next year.
So the life business is a long-term business. It's a long-term protection business. So reforms to complete the reforms, we can't take shortcuts. So we have 25 years of experience, and we have a very strong team, and I believe that we will have explosive growth going forward. So the next question is from a caller online.
Thank you.
Hi, good morning. Thank you for taking my question. I've got two questions. First one is on the life business again. The question there is, as restrictions are lifted within Mainland China, how are trends evolving? For example, what is the runway of sales in July versus the normal runway expected? As face-to-face resumes, are product trends returning to long-term averages, i.e., you know, more protection? And given the second quarter, slight increase in agent numbers, should we expect agent headcount to rise through the course of the second half of the year? The second question is on operating profit. On the life side, maybe if you could just help us, what the normalized tax rate is, given it was 13% in the first half, and operating variances, should they return to normal in the second half?
Because I think there's some investment spend in there. And related to operating profit on technology, profits, clearly nice recovery there. Is this sustainable and improving? Because in the past, you've talked about lumpy investment spend, so I just wanted to understand if the second quarter had, you know, a low level of investments. Thank you.
I said that you should ask just one question, and I want to leave more opportunities for other questions. So just please limit your question to just one. So who wants to answer one of the questions? Because the quality of the sound is not very very good, but I get what you're asking. So the first question is about our product policies in the second quarter and our agent force. As you can see in the second half, our new business growth remained flat as in quarter one, and it's still negative, and that's because of COVID. Although after March and fourth the virus was contained, however it still impeded the face-to-face sessions between our agents and customers, especially when they sold high-margin protection products.
So in the second half, our sales for high-margin products will continue to face challenges. But in the second half of the second quarter, we launched a new product called Protection 100%. It's a critical illness plus universal. So that was very well received by the agents, and it more or less relieved the difficulties of our business growth. So in the second half, and our premium growth was higher than the margin growth. For Protection 100%, new product, it can increase customer activity, and it's very helpful for increasing the income for our agents.
We hope that in the second half, as the crisis recedes, we will be able to return to our old and traditional ways of making sales. Of course, we will update our products according to the new definitions of critical illness, and we will continue to focus on scenario-based and high-touch products related to life and health to promote and to optimize our product portfolio. In terms of the agent force, our reform is to become strong first and then bigger next. So we want to focus more on quality. So we are not targeting very rapid growth of our agents. We could recruit more agents, but that won't serve our long-term goal.... In terms of recruitment, we have three measures.
One is that we have a very stringent processes, including the back office profiling, and we will in-enhance training, on-the-job training and onboarding training. So we are focusing on these measures to enhance the quality of our agents. We also adjusted the categorization of our customers. Some focus on human resources and some focus on productivity, based on the basic methods, we will have a differentiated HR policy. About the operating profit, given the tough situation, our operating profit increased by 7%. But still, we face more pressure from COVID-19. We have slower business growth due to the impact of COVID-19 on new business growth. It's now zero or even negative, and that will slow down the amortization of residual value.
And number two, we have seen some deviation of our operation. The first reason is the renewal rate, because during COVID-19, some high-margin products are facing difficulties because the agents can't follow up with their customer service, and that's why we see lower new business growth. And also, for lower fees, including higher investment in technology and to provide more incentives to new recruits. If you cut costs in these areas, you won't be able to fulfill your obligations. But for first year premium and uncertain, they were facing pressure from COVID, so especially in the second quarter, we had worse performance. But we hope that this in the second half, as the virus recedes, we will have better performance. I believe in the whole year, we will increase our investment in technology.
Also, you can expect the improvement to manifest in a month or two. It's gonna take some time, especially with the new reforms. You will be able to see the results later.
You can see the first half persistency was lower, but there's another reason. It's not just about persistency, it's also related to product mix. In the past, we are selling a lot of the short-term saving type of products. They paid it in, about three to five years. The one month persistency is better than the long-term critical illness products. So we're making the change of product mix, which will lead to the, you know, the 13-month persistency rate, well, which is lower. And as mentioned in the first question, our life insurance reform will be completed within this year. Okay, we'll take another question from the floor, the gentleman in the middle.
Thank you for this chance. I am from Guotai Junan. My name is Liu Xinqi. I have a product question.
Now, there are many internet insurance company releasing their financial data, and you can see this type of new business model. Now, they are impacting the traditional insurer, not just the channel, but they are impacting by some of the products. They are eroding some of the high-margin product by traditional insurers. So you see in Ping An, in the short-term insurance, percentage has been really shrinking fast. I just wonder why. And in light of these internet players, internet finance, internet insurance, they are, you know, impacting your impact. So do you have any product to maintain your high-margin business going forward, so as to retain your customers in that regard?
I will take your question. When you mention internet insurance, yes, indeed, we have seen such a trend which is growing. And we are actually in close contact and communication with them. We learn a lot from them. There are three type of model going on. The first is the pure online play, online model, and the traditional insurance model, they have the online model, and we have the online plus offline model. Now, you talk about the short-term insurance. During the pandemic, we have done a lot of, you know, pro bono kind of business, like some of the policy insurance, which is for the public goods. But later on, we found out when we are selling this product, they actually bring us new customers.
So later on, it becomes a product to acquire customers.
... Of course, it has very low margin, almost no, almost no margin. This is not something we focus. We focus on long-term, high protection type of policies. So the three models that I mentioned, the long-term, high protection product, if you do it pure online, I come from an internet background, I know it doesn't work. It's difficult. There are three things in China that have to do offline: house, your car, and high protection insurance policy. This is extremely difficult to do it virtually. There has to be an offline component, which is why our offline team, our, our life insurance team, they continue. Jessica has talked a lot about the reform, which will be completed this year. Importantly, the reform of the channels. The agency channel, they are more capable to sell these high protection products. The third model that I mentioned is the online, offline integration.
In our course of reform, we are also exploring this model of offline plus online, offline, like social marketing, e-business marketing, online marketing. Everything we do is to help build this model, because the customers are changing now. If you purely approach them offline, it's gonna be difficult. Offline is difficult, online is challenging, so you have to go offline plus online. We have eight tools. The eight tools produce a toolbox to help them to develop this online, offline integrated approach. Over the long run, we're gonna see the three models exist, but online, offline integration is the approach that we have opted to take.
All right. Okay, we're gonna take another question from the call. Next question is from Nomura. Thank you, management, for this opportunity.
My question is, the media has reported the Basic Law for your agencies is now being revised, probably part of your reform efforts to revise the Basic Law. Now, what are the changes to the Basic Law? What... How is it related to the interests of the agents themselves? And what do you hope to achieve by revising the Basic Law? I mean, do you want to drive the channel growth for the agency by revising the Basic Law?
I will take your question. Thank you. Now, the reform on the Basic Law come from two reasons. First, it is to support the life insurance reform that we talk about, to pave the way for the reform. Secondly, it is to show more care and incentive to the agents over the longer run. There are three type of changes.
Firstly, the classification of our organization. Secondly, the profit sharing with the agents. Thirdly, the long-term incentives and more care to the long-term benefit. First of all, classification, as I mentioned, there are three type of organizations, and they are going to be operated differently, because in China, China is such a big country with such uneven and unbalanced economy. So in different geography, there's going to be a different approach to manage the organization in that region, to support the growth in the region. Like Beijing, Shanghai, Guangzhou, Shenzhen, they're gonna adopt a capacity type of organization. This organization is all about building capacity. In more developed region, we adopt a approach, which is more balanced. We're gonna have recruitment with quality, at the same time, we're gonna increase the capacity activity.
In some of the less developed region, we're gonna adopt mostly driving headcounts, incentivizing to build agency numbers. Of course, there are some quality metrics attached, but at the same... Of course, they have to watch out for activity and capacity. So after classifying different organization, they're gonna have different resources support. Secondly, for agents, profit sharing. For new recruits, high performers and supervisors. New recruits will have new policy for the new recruits, because retention of new recruits is important. When you recruit some high potential, you want to retain them. So in terms of resources, we have the subsidy, we extend the subsidy of the duration for the new recruits, so that they can weather through the opening period. For high performers, we have added more, resources, so that these high performers can actually be incentivized to be promoted and developed further.
For supervisor managers, we encourage them to build their management capabilities, so that they can really bring their offices and the business units. This is more like a digital business unit strategy. The third area, it is the long-term investment. It's really about caring and incentivizing and managing our agent over a long term. For caring our agents, our managers, some of the, elder, manager, they have a succession plan. When they reach the time for retirement, they can, you know, pass on to their children. So they can manage their business as if it's their family business, and, including pension, for these, individuals. And the enumerations, as I mentioned, for new, recruits, high performers will have better benefits for them, and, and also in managerial approaches. Because we increased the resources to be invested on them.
So for the mid to long-term development, we are actually raising the bar, and we raised the demand and requirement for them. So in short, reform of the basic law is critical, and it's really all about classifying organization, you know, the stratifying the, staffs, stratification of staff, and also incentivizing. We are now communicating this basic law, and they have been broadly welcomed by our field agents. I have visited 15 organizations, and I—the feedback that I got, we got a completely different feedback from this basic law. This basic law, I'm sure, is going to help us to sustain our future growth of this business. Next question. Before the next question, actually, some of the analysts... Well, in Jessica replying to the question of the call, there's one point, that was lost in translation.
Jessica was saying the full year reform of the insurance business will be implemented within this year, and we're going to starting to see the results of these reforms for insurance.
Okay, the next question goes to, I will leave it to the lady.
Thank you, management, for this chance. I' m from Huaxi Securities. I'm Uncertain. My question is, now, regulatory policy on the draft of the auto insurance reform. So for P&C and auto insurance, what is the company's plan going forward?
I mean, Ping An is now having a customer, you know, program for the auto business to be introduced to other lines of business. So regarding the auto insurance reform, let me just give you a background of the reform. The regulator probably have two intentions.
Firstly, they want to protect the consumers' interest. That's the first goal for this reform. Now, specifically, some of the protection scope, and also reducing the premium. And secondly, they want to drive better quality growth for the auto insurance. They try to address some of the chaos, irrational behaviors in the market. So the main changes come from a few areas. Now, first of all, the mandatory insurance, increasing the sum insured, and also expanding the liability scope of commercial insurance and optimizing the NCD, no-claim discount. And also to restrict some of the expenses cap from 35%, reducing to 25% as a cap.
Now, with this range of measures, after implemented, if implemented, I think for the industry or for Ping An, there are going to be several impacts. First of all, after the reform, the basic fee, basic rate will be reduced by the customer's premium payment will be reduced. So that's going to lead to some short-term impact for the industry, where you see a slower growth or smaller growth within premium as a whole. In addition, after the fee adjustments, by some of the expenses, costs, compliance, those will be improved as a result. And also, you can see that after implementation, the expense ratio will be lower, the loss ratio will be higher because you have lower fee, but claims still happens. So as a whole, the claim ratio is hopefully maintained at a healthy level.
Ping An has prepared for this for a long time. Now, thanks to our risk management capability, teams, actuary, and data capabilities, we have done a lot of KYD, and also some of the driver data analytics. So if this new rate table was introduced, I think this is going to be opportunity for Ping An, because we can tap into our pricing capability, risk screening capabilities, and also expense, you know, when we reach the expense cap, some of the irregular behavior by other insurance company will be curbed by limiting the cap. For big company like us, is actually a benefit. So over longer run, the reform for the auto insurance is going to rationalize the cost structure.
Most of the money is going to be used for claims settlement, not to pay for the expenses. So this really serve to protect the consumers and also helping the auto insurance to be more regulated and develop more healthy.
Let me just add to this. Mr. Yao has talked about some of the mid, short-term, mid to short-term impact, but I would like to take a mid to long-term perspective. If you look at it from an ecosystem point of view, how to put this reform into perspective. In January this year, Ping An Bank and Ping An P&C jointly developed the car owner credit card. It is really helping out the auto insurance users have more scenarios to consume, where they have better consumption services.
When we launched this credit card, we talk about auto insurance demand. They want refueling, they want maintenance, they want ease of commuting. So we are helping to manage these auto insurance users so that they become car users. They're gonna have high-frequency interaction, they're gonna receive direct services, and the services generate data, and data create value. So example, refueling is 12% off. Maintenance also offers some discounts, and they—when they go out, they can enjoy convenience. For example, if you hail the car from Didi, you're gonna have some benefits. So from these car owner apps, we have 107 million users on this app. And in P&C auto insurance, we have 60 million P&C customers, and Ping An Bank, we have 30 million car owner credit cards.
So in terms of data and identification, we know there are people who have a vehicle. They don't have a credit card from bank. They don't have a P&C. We still have 40 million untouched car owners. So this year, the P&C and bank, they make a important decision, including Autohome. They're gonna use credit card to build a ecosystem around the car owner. This ecosystem is going to embed the bank's account, the frequency transaction of the bank is going to be leveraged, and also, the equity of the customer will be put into this account as well. So the sales cost, renewal rate, and the loyalty of this auto insurance user will be massively increased. This will help the credit card to grow even faster.
Time permits, the only last question for the online caller. Thank you. Thomas from Goldman Sachs.
Thank you. A simple question. Mr. Yao talked about dividend increased by 7%. Only, as you know, dividend is linked to the full year operating profit, so you are confident that you're gonna have a high single-digit growth this year? Or, if the profit growth was not good enough, you're gonna reduce the payout in the second half? And also, you separate different markets for the agents. For investors, can you give us some numbers in the stratification of agents? I mean, by stratifying the agents, what are the numbers? What are the activities and productivities? Because it's difficult for us to tell what part of team is actually recruiting more.
About dividend, indeed, our interim dividend grew by 7%. But full year, of course, we did not make a prediction or forecast of the full year dividend. For the half year, interim dividend is actually growing faster than the OPAT, operating profit. It goes to show our confidence in our performance and operating profits, and also with our solvency, adequacy, and. For mid to long term, we want to continue to increase our dividend per share, so that we can offer a stable and continuously rising return to shareholders.
Okay, thank you for joining us at this results announcement. And the management has taken many questions, which covers most of the question that we have collected from the IR email address.
So subsequently, you can log on to the Ping An's website under the investor relations column, and you're gonna see the playback of this announcement. Thank you again. Many of you have come from Beijing and Shanghai. Thank you for making the trip. And you have to catch the early flight at 6:00 A.M. to come here. Thank you, and see you next time.