NEW YORK, Feb. 03, 2020 (GLOBE NEWSWIRE) -- Pawar Law Group announces that a class action lawsuit on behalf of shareholders who purchased shares of X Financial (XYF) pursuant and/or traceable to the registration statement and related prospectus (collectively, the “Registration Statement”) issued in connection with X Financial’s September 2018 initial public stock offering (the “IPO” or the “Offering”), inclusive (the “Class Period”). The lawsuit seeks to recover damages for X Financial investors under the federal securities laws.
A class action lawsuit has already been filed. If you wish to serve as lead plaintiff, you must move the Court no later than February 7, 2020. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation.
According to the lawsuit, defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that (1) the Company’s total loan facilitation amount was not growing, but rather was contracting; (2) the number of investors actively using X Financial’s platform was shrinking; (3) demand from small- and medium-sized enterprises for the Company’s Xiaoying Preferred Loans (“preferred loans”) was plummeting; (4) the Company’s preferred loans had performed so poorly that it had begun drastically scaling back its preferred loans in the first quarter of 2018, several months before the IPO, and was in the process of phasing out such loans completely; (5) demand for the Company’s Xiaoying Card Loans was also plummeting; (6) the revenue and loan facilitation growth provided in the Registration Statement leading up to the IPO was achieved by relaxed credit and due diligence standards, under which the Company had underwritten tens of millions of dollars’ worth of poor quality loans that suffered from a disproportionately high risk of default as compared to the Company’s earlier loan vintages; (7) the Company was suffering from accelerated delinquency rates from poor quality loans that it had underwritten in the first, second, and third quarters of 2018, which had caused the Company’s delinquency rate to sharply rise; (8) the Company’s product mix had significantly deteriorated; (9) the Company’s net revenue was on track to decline by 22% during the third quarter of 2018; and (10) as a result, defendants’ statements about X Financial’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times. When the true details entered the market, the lawsuit claims that investors suffered damages.
No class has been certified. Until a class is certified, you are not represented by counsel unless you hire one. You may hire counsel of your choice. You may also do nothing at this time and be an absent member of the class. Your ability to share in any future recovery is not dependent upon being a lead plaintiff. Attorney advertising.
Pawar Law Group represents investors from around the world.
Vik Pawar, Esq.
Pawar Law Group
20 Vesey Street, Suite 1410
New York, NY 10007
Tel: (917) 261-2277
Fax: (212) 571-0938